Derivatives and Hedging (Tables)

9 Months Ended

Sep. 30, 2012

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
		Volume
		September 30,		December 31,		Unit of
		2012		2011		Measure
Primary Risk Exposure		(in millions)
Commodity:
	Power		617		609	MWhs
	Coal		15		21	Tons
	Natural Gas		123		100	MMBtus
	Heating Oil and Gasoline		5		6	Gallons
	Interest Rate	$	258	$	226	USD
Interest Rate and Foreign Currency		$	703	$	907	USD

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
September 30, 2012
		Risk Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in millions)
Current Risk Management Assets		$	699	$	36	$	1	$	(561)	$	175
Long-term Risk Management Assets			606		12		1		(229)		390
Total Assets			1,305		48		2		(790)		565
Current Risk Management Liabilities			656		35		37		(578)		150
Long-term Risk Management Liabilities			460		12		2		(250)		224
Total Liabilities			1,116		47		39		(828)		374
Total MTM Derivative Contract Net Assets
	(Liabilities)	$	189	$	1	$	(37)	$	38	$	191
Fair Value of Derivative Instruments
December 31, 2011
		Risk Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in millions)
Current Risk Management Assets		$	852	$	24	$	-	$	(683)	$	193
Long-term Risk Management Assets			641		15		-		(253)		403
Total Assets			1,493		39		-		(936)		596
Current Risk Management Liabilities			847		29		20		(746)		150
Long-term Risk Management Liabilities			483		15		22		(325)		195
Total Liabilities			1,330		44		42		(1,071)		345
Total MTM Derivative Contract Net Assets
	(Liabilities)	$	163	$	(5)	$	(42)	$	135	$	251

(a)Derivative instruments within these categories are reported gross. These instruments are subject to master netting agreements and are presented on the condensed balance sheets on a net basis in accordance with the accounting guidance for "Derivatives and Hedging."

(b)Amounts include counterparty netting of risk management and hedging contracts and associated cash collateral in accordance with the accounting guidance for "Derivatives and Hedging."Amounts also include de-designated risk management contracts.

Amount of Gain Loss Recognized on Risk Management Contracts

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three and Nine Months Ended September 30, 2012 and 2011
	Three Months Ended September 30,				Nine Months Ended September 30,
Location of Gain (Loss)	2012		2011		2012		2011
	(in millions)
Utility Operations Revenues	$	5	$	8	$	19	$	46
Other Revenues		20		6		28		21
Regulatory Assets (a)		2		(3)		(35)		(3)
Regulatory Liabilities (a)		(14)		(2)		12		8
Total Gain (Loss) on Risk
Management Contracts	$	13	$	9	$	24	$	72

(a)Represents realized and unrealized gains and losses subject to regulatory accounting treatmentrecorded as either current or noncurrent on the condensed balance sheets.

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2012
					Interest Rate
					and Foreign
			Commodity		Currency		Total
			(in millions)
Balance in AOCI as of June 30, 2012			$	(14)	$	(30)	$	(44)
Changes in Fair Value Recognized in AOCI				16		(3)		13
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		-		-		-
		Other Revenues		(1)		-		(1)
		Purchased Electricity for Resale		-		-		-
		Interest Expense		-		1		1
		Regulatory Assets (a)		-		-		-
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of September 30, 2012			$	1	$	(32)	$	(31)
Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2011
					Interest Rate
					and Foreign
			Commodity		Currency		Total
			(in millions)
Balance in AOCI as of June 30, 2011			$	12	$	5	$	17
Changes in Fair Value Recognized in AOCI				2		(21)		(19)
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		1		-		1
		Other Revenues		(1)		-		(1)
		Purchased Electricity for Resale		(2)		-		(2)
		Interest Expense		-		1		1
		Regulatory Assets (a)		-		-		-
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of September 30, 2011			$	12	$	(15)	$	(3)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2012
					Interest Rate
					and Foreign
			Commodity		Currency		Total
			(in millions)
Balance in AOCI as of December 31, 2011			$	(3)	$	(20)	$	(23)
Changes in Fair Value Recognized in AOCI				(7)		(15)		(22)
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		-		-		-
		Other Revenues		(4)		-		(4)
		Purchased Electricity for Resale		13		-		13
		Interest Expense		-		3		3
		Regulatory Assets (a)		2		-		2
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of September 30, 2012			$	1	$	(32)	$	(31)
Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2011
					Interest Rate
					and Foreign
			Commodity		Currency		Total
			(in millions)
Balance in AOCI as of December 31, 2010			$	7	$	4	$	11
Changes in Fair Value Recognized in AOCI				7		(22)		(15)
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		3		-		3
		Other Revenues		(3)		-		(3)
		Purchased Electricity for Resale		(3)		-		(3)
		Interest Expense		-		3		3
		Regulatory Assets (a)		1		-		1
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of September 30, 2011			$	12	$	(15)	$	(3)

(a)       Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current or noncurrent on the condensed balance sheets.

Impact of Cash Flow Hedges on the Condensed Balance Sheet

Impact of Cash Flow Hedges on the Condensed Balance Sheet
September 30, 2012
				Interest Rate
				and Foreign
		Commodity		Currency		Total
		(in millions)
Hedging Assets (a)		$	33	$	-	$	33
Hedging Liabilities (a)			32		39		71
AOCI Gain (Loss) Net of Tax			1		(32)		(31)
Portion Expected to be Reclassified to Net
	Income During the Next Twelve Months		-		(4)		(4)
Impact of Cash Flow Hedges on the Condensed Balance Sheet
December 31, 2011
				Interest Rate
				and Foreign
		Commodity		Currency		Total
		(in millions)
Hedging Assets (a)		$	20	$	-	$	20
Hedging Liabilities (a)			25		42		67
AOCI Gain (Loss) Net of Tax			(3)		(20)		(23)
Portion Expected to be Reclassified to Net
	Income During the Next Twelve Months		(3)		(2)		(5)

(a)Hedging Assets and Hedging Liabilities are included in Risk Management Assets and Liabilities on thecondensed balance sheets.

Collateral Required Under Various Triggering Events

		September 30,		December 31,
		2012		2011
		(in millions)
Liabilities for Derivative Contracts with Credit Downgrade Triggers		$	7	$	32
Amount of Collateral AEP Subsidiaries Would Have Been
	Required to Post		44		39
Amount Attributable to RTO and ISO Activities			42		38

Liabilities Subject to Cross Default Provisions

	September 30,		December 31,
	2012		2011
	(in millions)
Liabilities for Contracts with Cross Default Provisions Prior to Contractual
Netting Arrangements	$	519	$	515
Amount of Cash Collateral Posted		3		56
Additional Settlement Liability if Cross Default Provision is Triggered		329		291

Appalachian Power Co [Member]

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
September 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		142,425		98,176		200,993		14		16
	Coal		Tons		2,498		2,944		5,052		2,416		2,241
	Natural Gas		MMBtus		11,127		7,647		15,703		13		15
	Heating Oil and
		Gasoline	Gallons		858		440		1,041		494		471
	Interest Rate		USD	$	29,011	$	19,936	$	40,940	$	-	$	-
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	-
Notional Volume of Derivative Instruments
December 31, 2011
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		169,459		109,326		229,468		39		49
	Coal		Tons		3,714		1,920		8,337		3,574		2,974
	Natural Gas		MMBtus		7,923		5,081		10,728		115		145
	Heating Oil and
		Gasoline	Gallons		1,057		525		1,254		618		569
	Interest Rate		USD	$	31,029	$	19,890	$	42,093	$	175	$	203
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	200,069

Cash Collateral Netting

	September 30, 2012				December 31, 2011
	Cash Collateral		Cash Collateral		Cash Collateral		Cash Collateral
	Received		Paid		Received		Paid
	Netted Against		Netted Against		Netted Against		Netted Against
	Risk Management		Risk Management		Risk Management		Risk Management
Company	Assets		Liabilities		Assets		Liabilities
	(in thousands)
APCo	$	2,375	$	10,408	$	4,291	$	28,964
I&M		1,632		7,151		2,752		18,547
OPCo		3,352		14,687		5,810		39,183
PSO		5		9		53		130
SWEPCo		6		9		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
September 30, 2012
APCo
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	165,813	$	1,307	$	-	$	(135,893)	$	31,227
Long-term Risk Management Assets			82,738		291		-		(44,658)		38,371
Total Assets			248,551		1,598		-		(180,551)		69,598
Current Risk Management Liabilities			157,836		1,757		-		(141,267)		18,326
Long-term Risk Management Liabilities			68,293		419		-		(47,907)		20,805
Total Liabilities			226,129		2,176		-		(189,174)		39,131
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	22,422	$	(578)	$	-	$	8,623	$	30,467
Fair Value of Derivative Instruments
December 31, 2011
APCo
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	232,784	$	1,040	$	-	$	(194,179)	$	39,645
Long-term Risk Management Assets			99,751		90		-		(60,615)		39,226
Total Assets			332,535		1,130		-		(254,794)		78,871
Current Risk Management Liabilities			235,354		2,767		-		(211,515)		26,606
Long-term Risk Management Liabilities			82,058		350		-		(69,485)		12,923
Total Liabilities			317,412		3,117		-		(281,000)		39,529
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	15,123	$	(1,987)	$	-	$	26,206	$	39,342

(a) Derivative instruments within these categories are reported gross. These instruments are subject to master netting agreements and are presented on the condensed balance sheets on a net basis in accordance with the accounting guidance for "Derivatives and Hedging."

(b) Amounts include counterparty netting of risk management and hedging contracts and associated cash collateral in accordance with the accounting guidance for "Derivatives and Hedging." Amounts also include de-designated risk management contracts.

Amount of Gain Loss Recognized on Risk Management Contracts

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	378	$	3,814	$	87	$	71	$	174
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(138)		(1,213)		3,000		598		115
Regulatory Liabilities (a)			(1,672)		(5,267)		(6,788)		2		11
Total Gain (Loss) on Risk Management
	Contracts	$	(1,432)	$	(2,666)	$	(3,701)	$	671	$	300
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	960	$	3,094	$	4,652	$	(530)	$	(186)
Sales to AEP Affiliates			103		58		126		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			139		71		(2,846)		(264)		(219)
Regulatory Liabilities (a)			(1,058)		(2,566)		26		1,930		174
Total Gain (Loss) on Risk Management
	Contracts	$	144	$	657	$	1,956	$	1,138	$	(229)

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(548)	$	9,206	$	11,118	$	231	$	426
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(6,133)		(7,228)		(9,026)		(5,360)		(6,977)
Regulatory Liabilities (a)			8,166		1,851		390		3		6
Total Gain (Loss) on Risk Management
	Contracts	$	1,485	$	3,829	$	2,482	$	(5,126)	$	(6,545)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	3,659	$	12,211	$	26,806	$	128	$	340
Sales to AEP Affiliates			136		81		171		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			373		186		(7,028)		285		2,975
Regulatory Liabilities (a)			9,827		(4,230)		(105)		2,509		58
Total Gain (Loss) on Risk Management
	Contracts	$	13,995	$	8,248	$	19,842	$	2,924	$	3,375
(a) Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current
or noncurrent on the condensed balance sheet.

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Changes in Fair Value Recognized in AOCI					1,302		887		1,915		126		123
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Changes in Fair Value Recognized in AOCI					-		(1,542)		1		1		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)
Changes in Fair Value Recognized in AOCI					1,302		(655)		1,916		127		122
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Changes in Fair Value Recognized in AOCI					(646)		(332)		(765)		(162)		(148)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Changes in Fair Value Recognized in AOCI					-		(4,764)		-		-		(10,896)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
Changes in Fair Value Recognized in AOCI					(646)		(5,096)		(765)		(162)		(11,044)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(1,309)	$	(819)	$	(1,748)	$	(69)	$	(62)
Changes in Fair Value Recognized in AOCI					(946)		(741)		(1,487)		110		106
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	1,024	$	(14,465)	$	9,454	$	7,218	$	(15,462)
Changes in Fair Value Recognized in AOCI					-		(6,390)		1		1		(2,778)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(285)	$	(15,284)	$	7,706	$	7,149	$	(15,524)
Changes in Fair Value Recognized in AOCI					(946)		(7,131)		(1,486)		111		(2,672)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(273)	$	(178)	$	(364)	$	88	$	82
Changes in Fair Value Recognized in AOCI					(523)		(279)		(622)		18		20
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	217	$	(8,507)	$	10,813	$	8,406	$	(4,272)
Changes in Fair Value Recognized in AOCI					(373)		(4,764)		-		(476)		(10,095)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(56)	$	(8,685)	$	10,449	$	8,494	$	(4,190)
Changes in Fair Value Recognized in AOCI					(896)		(5,043)		(622)		(458)		(10,075)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)
(a)			Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current or noncurrent on the condensed balance sheets.

Impact of Cash Flow Hedges on the Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
September 30, 2012
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	925	$	-	$	1,503	$	-	$	(362)	$	1,823
I&M		622		-		1,032		20,465		(257)		(20,408)
OPCo		1,289		-		2,120		-		(524)		8,435
PSO		46		-		6		-		34		6,650
SWEPCo		43		-		6		-		34		(16,240)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
					Maximum Term for
			Interest Rate		Exposure to
			and Foreign		Variability of Future
Company	Commodity		Currency		Cash Flows
	(in thousands)				(in months)
APCo	$	(278)	$	(1,013)		20
I&M		(202)		(1,316)		20
OPCo		(405)		1,359		20
PSO		36		759		15
SWEPCo		34		(2,369)		15

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
December 31, 2011
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	431	$	-	$	2,418	$	-	$	(1,309)	$	1,024
I&M		277		-		1,523		10,637		(819)		(14,465)
OPCo		584		-		3,239		-		(1,748)		9,454
PSO		-		-		107		-		(69)		7,218
SWEPCo		-		3		97		19,143		(62)		(15,462)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
			Interest Rate
			and Foreign
Company	Commodity		Currency
	(in thousands)
APCo	$	(1,140)	$	(1,052)
I&M		(712)		(595)
OPCo		(1,518)		1,359
PSO		(70)		759
SWEPCo		(63)		(1,864)

(a)       Hedging Assets and Hedging Liabilities are included in Risk Management Assets and Liabilities on the condensed balance sheets.

Collateral Required Under Various Triggering Events

	September 30, 2012
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	2,155	$	4,301	$	4,301
I&M		1,481		2,956		2,956
OPCo		3,042		6,070		6,070
PSO		-		1,288		885
SWEPCo		-		1,517		1,042

	December 31, 2011
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	10,007	$	6,211	$	6,211
I&M		6,418		3,983		3,983
OPCo		13,550		8,410		8,410
PSO		-		856		414
SWEPCo		-		1,128		522

Liabilities Subject to Cross Default Provisions

	September 30, 2012
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	64,466	$	76	$	33,019
I&M		64,767		52		43,156
OPCo		90,977		107		46,597
PSO		26		-		16
SWEPCo		30		-		19
	December 31, 2011
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	76,868	$	8,107	$	27,603
I&M		59,936		5,200		28,339
OPCo		104,091		10,978		37,380
PSO		142		-		61
SWEPCo		19,322		-		19,220

Indiana Michigan Power Co [Member]

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
September 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		142,425		98,176		200,993		14		16
	Coal		Tons		2,498		2,944		5,052		2,416		2,241
	Natural Gas		MMBtus		11,127		7,647		15,703		13		15
	Heating Oil and
		Gasoline	Gallons		858		440		1,041		494		471
	Interest Rate		USD	$	29,011	$	19,936	$	40,940	$	-	$	-
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	-
Notional Volume of Derivative Instruments
December 31, 2011
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		169,459		109,326		229,468		39		49
	Coal		Tons		3,714		1,920		8,337		3,574		2,974
	Natural Gas		MMBtus		7,923		5,081		10,728		115		145
	Heating Oil and
		Gasoline	Gallons		1,057		525		1,254		618		569
	Interest Rate		USD	$	31,029	$	19,890	$	42,093	$	175	$	203
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	200,069

Cash Collateral Netting

	September 30, 2012				December 31, 2011
	Cash Collateral		Cash Collateral		Cash Collateral		Cash Collateral
	Received		Paid		Received		Paid
	Netted Against		Netted Against		Netted Against		Netted Against
	Risk Management		Risk Management		Risk Management		Risk Management
Company	Assets		Liabilities		Assets		Liabilities
	(in thousands)
APCo	$	2,375	$	10,408	$	4,291	$	28,964
I&M		1,632		7,151		2,752		18,547
OPCo		3,352		14,687		5,810		39,183
PSO		5		9		53		130
SWEPCo		6		9		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
September 30, 2012
I&M
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	118,202	$	882	$	-	$	(90,582)	$	28,502
Long-term Risk Management Assets			56,711		199		-		(30,606)		26,304
Total Assets			174,913		1,081		-		(121,188)		54,806
Current Risk Management Liabilities			105,794		1,204		20,465		(94,275)		33,188
Long-term Risk Management Liabilities			47,380		287		-		(32,838)		14,829
Total Liabilities			153,174		1,491		20,465		(127,113)		48,017
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	21,739	$	(410)	$	(20,465)	$	5,925	$	6,789
Fair Value of Derivative Instruments
December 31, 2011
I&M
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	154,628	$	667	$	-	$	(123,143)	$	32,152
Long-term Risk Management Assets			68,047		58		-		(38,743)		29,362
Total Assets			222,675		725		-		(161,886)		61,514
Current Risk Management Liabilities			149,466		1,747		-		(134,233)		16,980
Long-term Risk Management Liabilities			52,441		224		10,637		(44,431)		18,871
Total Liabilities			201,907		1,971		10,637		(178,664)		35,851
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	20,768	$	(1,246)	$	(10,637)	$	16,778	$	25,663

(a) Derivative instruments within these categories are reported gross. These instruments are subject to master netting agreements and are presented on the condensed balance sheets on a net basis in accordance with the accounting guidance for "Derivatives and Hedging."

(b) Amounts include counterparty netting of risk management and hedging contracts and associated cash collateral in accordance with the accounting guidance for "Derivatives and Hedging." Amounts also include de-designated risk management contracts.

Amount of Gain Loss Recognized on Risk Management Contracts

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	378	$	3,814	$	87	$	71	$	174
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(138)		(1,213)		3,000		598		115
Regulatory Liabilities (a)			(1,672)		(5,267)		(6,788)		2		11
Total Gain (Loss) on Risk Management
	Contracts	$	(1,432)	$	(2,666)	$	(3,701)	$	671	$	300
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	960	$	3,094	$	4,652	$	(530)	$	(186)
Sales to AEP Affiliates			103		58		126		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			139		71		(2,846)		(264)		(219)
Regulatory Liabilities (a)			(1,058)		(2,566)		26		1,930		174
Total Gain (Loss) on Risk Management
	Contracts	$	144	$	657	$	1,956	$	1,138	$	(229)

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(548)	$	9,206	$	11,118	$	231	$	426
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(6,133)		(7,228)		(9,026)		(5,360)		(6,977)
Regulatory Liabilities (a)			8,166		1,851		390		3		6
Total Gain (Loss) on Risk Management
	Contracts	$	1,485	$	3,829	$	2,482	$	(5,126)	$	(6,545)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	3,659	$	12,211	$	26,806	$	128	$	340
Sales to AEP Affiliates			136		81		171		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			373		186		(7,028)		285		2,975
Regulatory Liabilities (a)			9,827		(4,230)		(105)		2,509		58
Total Gain (Loss) on Risk Management
	Contracts	$	13,995	$	8,248	$	19,842	$	2,924	$	3,375
(a) Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current
or noncurrent on the condensed balance sheet.

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Changes in Fair Value Recognized in AOCI					1,302		887		1,915		126		123
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Changes in Fair Value Recognized in AOCI					-		(1,542)		1		1		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)
Changes in Fair Value Recognized in AOCI					1,302		(655)		1,916		127		122
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Changes in Fair Value Recognized in AOCI					(646)		(332)		(765)		(162)		(148)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Changes in Fair Value Recognized in AOCI					-		(4,764)		-		-		(10,896)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
Changes in Fair Value Recognized in AOCI					(646)		(5,096)		(765)		(162)		(11,044)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(1,309)	$	(819)	$	(1,748)	$	(69)	$	(62)
Changes in Fair Value Recognized in AOCI					(946)		(741)		(1,487)		110		106
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	1,024	$	(14,465)	$	9,454	$	7,218	$	(15,462)
Changes in Fair Value Recognized in AOCI					-		(6,390)		1		1		(2,778)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(285)	$	(15,284)	$	7,706	$	7,149	$	(15,524)
Changes in Fair Value Recognized in AOCI					(946)		(7,131)		(1,486)		111		(2,672)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(273)	$	(178)	$	(364)	$	88	$	82
Changes in Fair Value Recognized in AOCI					(523)		(279)		(622)		18		20
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	217	$	(8,507)	$	10,813	$	8,406	$	(4,272)
Changes in Fair Value Recognized in AOCI					(373)		(4,764)		-		(476)		(10,095)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(56)	$	(8,685)	$	10,449	$	8,494	$	(4,190)
Changes in Fair Value Recognized in AOCI					(896)		(5,043)		(622)		(458)		(10,075)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)
(a)			Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current or noncurrent on the condensed balance sheets.

Impact of Cash Flow Hedges on the Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
September 30, 2012
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	925	$	-	$	1,503	$	-	$	(362)	$	1,823
I&M		622		-		1,032		20,465		(257)		(20,408)
OPCo		1,289		-		2,120		-		(524)		8,435
PSO		46		-		6		-		34		6,650
SWEPCo		43		-		6		-		34		(16,240)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
					Maximum Term for
			Interest Rate		Exposure to
			and Foreign		Variability of Future
Company	Commodity		Currency		Cash Flows
	(in thousands)				(in months)
APCo	$	(278)	$	(1,013)		20
I&M		(202)		(1,316)		20
OPCo		(405)		1,359		20
PSO		36		759		15
SWEPCo		34		(2,369)		15

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
December 31, 2011
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	431	$	-	$	2,418	$	-	$	(1,309)	$	1,024
I&M		277		-		1,523		10,637		(819)		(14,465)
OPCo		584		-		3,239		-		(1,748)		9,454
PSO		-		-		107		-		(69)		7,218
SWEPCo		-		3		97		19,143		(62)		(15,462)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
			Interest Rate
			and Foreign
Company	Commodity		Currency
	(in thousands)
APCo	$	(1,140)	$	(1,052)
I&M		(712)		(595)
OPCo		(1,518)		1,359
PSO		(70)		759
SWEPCo		(63)		(1,864)

(a)       Hedging Assets and Hedging Liabilities are included in Risk Management Assets and Liabilities on the condensed balance sheets.

Collateral Required Under Various Triggering Events

	September 30, 2012
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	2,155	$	4,301	$	4,301
I&M		1,481		2,956		2,956
OPCo		3,042		6,070		6,070
PSO		-		1,288		885
SWEPCo		-		1,517		1,042

	December 31, 2011
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	10,007	$	6,211	$	6,211
I&M		6,418		3,983		3,983
OPCo		13,550		8,410		8,410
PSO		-		856		414
SWEPCo		-		1,128		522

Liabilities Subject to Cross Default Provisions

	September 30, 2012
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	64,466	$	76	$	33,019
I&M		64,767		52		43,156
OPCo		90,977		107		46,597
PSO		26		-		16
SWEPCo		30		-		19
	December 31, 2011
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	76,868	$	8,107	$	27,603
I&M		59,936		5,200		28,339
OPCo		104,091		10,978		37,380
PSO		142		-		61
SWEPCo		19,322		-		19,220

Ohio Power Co [Member]

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
September 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		142,425		98,176		200,993		14		16
	Coal		Tons		2,498		2,944		5,052		2,416		2,241
	Natural Gas		MMBtus		11,127		7,647		15,703		13		15
	Heating Oil and
		Gasoline	Gallons		858		440		1,041		494		471
	Interest Rate		USD	$	29,011	$	19,936	$	40,940	$	-	$	-
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	-
Notional Volume of Derivative Instruments
December 31, 2011
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		169,459		109,326		229,468		39		49
	Coal		Tons		3,714		1,920		8,337		3,574		2,974
	Natural Gas		MMBtus		7,923		5,081		10,728		115		145
	Heating Oil and
		Gasoline	Gallons		1,057		525		1,254		618		569
	Interest Rate		USD	$	31,029	$	19,890	$	42,093	$	175	$	203
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	200,069

Cash Collateral Netting

	September 30, 2012				December 31, 2011
	Cash Collateral		Cash Collateral		Cash Collateral		Cash Collateral
	Received		Paid		Received		Paid
	Netted Against		Netted Against		Netted Against		Netted Against
	Risk Management		Risk Management		Risk Management		Risk Management
Company	Assets		Liabilities		Assets		Liabilities
	(in thousands)
APCo	$	2,375	$	10,408	$	4,291	$	28,964
I&M		1,632		7,151		2,752		18,547
OPCo		3,352		14,687		5,810		39,183
PSO		5		9		53		130
SWEPCo		6		9		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
September 30, 2012
OPCo
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	242,904	$	1,827	$	-	$	(200,027)	$	44,704
Long-term Risk Management Assets			117,272		410		-		(63,355)		54,327
Total Assets			360,176		2,237		-		(263,382)		99,031
Current Risk Management Liabilities			231,792		2,477		-		(207,611)		26,658
Long-term Risk Management Liabilities			96,861		591		-		(67,939)		29,513
Total Liabilities			328,653		3,068		-		(275,550)		56,171
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	31,523	$	(831)	$	-	$	12,168	$	42,860
Fair Value of Derivative Instruments
December 31, 2011
OPCo
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	325,904	$	1,409	$	-	$	(273,020)	$	54,293
Long-term Risk Management Assets			136,519		122		-		(83,027)		53,614
Total Assets			462,423		1,531		-		(356,047)		107,907
Current Risk Management Liabilities			329,307		3,712		-		(296,458)		36,561
Long-term Risk Management Liabilities			112,454		474		-		(95,038)		17,890
Total Liabilities			441,761		4,186		-		(391,496)		54,451
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	20,662	$	(2,655)	$	-	$	35,449	$	53,456

(a) Derivative instruments within these categories are reported gross. These instruments are subject to master netting agreements and are presented on the condensed balance sheets on a net basis in accordance with the accounting guidance for "Derivatives and Hedging."

(b) Amounts include counterparty netting of risk management and hedging contracts and associated cash collateral in accordance with the accounting guidance for "Derivatives and Hedging." Amounts also include de-designated risk management contracts.

Amount of Gain Loss Recognized on Risk Management Contracts

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	378	$	3,814	$	87	$	71	$	174
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(138)		(1,213)		3,000		598		115
Regulatory Liabilities (a)			(1,672)		(5,267)		(6,788)		2		11
Total Gain (Loss) on Risk Management
	Contracts	$	(1,432)	$	(2,666)	$	(3,701)	$	671	$	300
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	960	$	3,094	$	4,652	$	(530)	$	(186)
Sales to AEP Affiliates			103		58		126		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			139		71		(2,846)		(264)		(219)
Regulatory Liabilities (a)			(1,058)		(2,566)		26		1,930		174
Total Gain (Loss) on Risk Management
	Contracts	$	144	$	657	$	1,956	$	1,138	$	(229)

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(548)	$	9,206	$	11,118	$	231	$	426
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(6,133)		(7,228)		(9,026)		(5,360)		(6,977)
Regulatory Liabilities (a)			8,166		1,851		390		3		6
Total Gain (Loss) on Risk Management
	Contracts	$	1,485	$	3,829	$	2,482	$	(5,126)	$	(6,545)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	3,659	$	12,211	$	26,806	$	128	$	340
Sales to AEP Affiliates			136		81		171		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			373		186		(7,028)		285		2,975
Regulatory Liabilities (a)			9,827		(4,230)		(105)		2,509		58
Total Gain (Loss) on Risk Management
	Contracts	$	13,995	$	8,248	$	19,842	$	2,924	$	3,375
(a) Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current
or noncurrent on the condensed balance sheet.

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Changes in Fair Value Recognized in AOCI					1,302		887		1,915		126		123
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Changes in Fair Value Recognized in AOCI					-		(1,542)		1		1		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)
Changes in Fair Value Recognized in AOCI					1,302		(655)		1,916		127		122
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Changes in Fair Value Recognized in AOCI					(646)		(332)		(765)		(162)		(148)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Changes in Fair Value Recognized in AOCI					-		(4,764)		-		-		(10,896)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
Changes in Fair Value Recognized in AOCI					(646)		(5,096)		(765)		(162)		(11,044)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(1,309)	$	(819)	$	(1,748)	$	(69)	$	(62)
Changes in Fair Value Recognized in AOCI					(946)		(741)		(1,487)		110		106
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	1,024	$	(14,465)	$	9,454	$	7,218	$	(15,462)
Changes in Fair Value Recognized in AOCI					-		(6,390)		1		1		(2,778)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(285)	$	(15,284)	$	7,706	$	7,149	$	(15,524)
Changes in Fair Value Recognized in AOCI					(946)		(7,131)		(1,486)		111		(2,672)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(273)	$	(178)	$	(364)	$	88	$	82
Changes in Fair Value Recognized in AOCI					(523)		(279)		(622)		18		20
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	217	$	(8,507)	$	10,813	$	8,406	$	(4,272)
Changes in Fair Value Recognized in AOCI					(373)		(4,764)		-		(476)		(10,095)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(56)	$	(8,685)	$	10,449	$	8,494	$	(4,190)
Changes in Fair Value Recognized in AOCI					(896)		(5,043)		(622)		(458)		(10,075)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)
(a)			Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current or noncurrent on the condensed balance sheets.

Impact of Cash Flow Hedges on the Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
September 30, 2012
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	925	$	-	$	1,503	$	-	$	(362)	$	1,823
I&M		622		-		1,032		20,465		(257)		(20,408)
OPCo		1,289		-		2,120		-		(524)		8,435
PSO		46		-		6		-		34		6,650
SWEPCo		43		-		6		-		34		(16,240)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
					Maximum Term for
			Interest Rate		Exposure to
			and Foreign		Variability of Future
Company	Commodity		Currency		Cash Flows
	(in thousands)				(in months)
APCo	$	(278)	$	(1,013)		20
I&M		(202)		(1,316)		20
OPCo		(405)		1,359		20
PSO		36		759		15
SWEPCo		34		(2,369)		15

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
December 31, 2011
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	431	$	-	$	2,418	$	-	$	(1,309)	$	1,024
I&M		277		-		1,523		10,637		(819)		(14,465)
OPCo		584		-		3,239		-		(1,748)		9,454
PSO		-		-		107		-		(69)		7,218
SWEPCo		-		3		97		19,143		(62)		(15,462)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
			Interest Rate
			and Foreign
Company	Commodity		Currency
	(in thousands)
APCo	$	(1,140)	$	(1,052)
I&M		(712)		(595)
OPCo		(1,518)		1,359
PSO		(70)		759
SWEPCo		(63)		(1,864)

(a)       Hedging Assets and Hedging Liabilities are included in Risk Management Assets and Liabilities on the condensed balance sheets.

Collateral Required Under Various Triggering Events

	September 30, 2012
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	2,155	$	4,301	$	4,301
I&M		1,481		2,956		2,956
OPCo		3,042		6,070		6,070
PSO		-		1,288		885
SWEPCo		-		1,517		1,042

	December 31, 2011
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	10,007	$	6,211	$	6,211
I&M		6,418		3,983		3,983
OPCo		13,550		8,410		8,410
PSO		-		856		414
SWEPCo		-		1,128		522

Liabilities Subject to Cross Default Provisions

	September 30, 2012
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	64,466	$	76	$	33,019
I&M		64,767		52		43,156
OPCo		90,977		107		46,597
PSO		26		-		16
SWEPCo		30		-		19
	December 31, 2011
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	76,868	$	8,107	$	27,603
I&M		59,936		5,200		28,339
OPCo		104,091		10,978		37,380
PSO		142		-		61
SWEPCo		19,322		-		19,220

Public Service Co Of Oklahoma [Member]

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
September 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		142,425		98,176		200,993		14		16
	Coal		Tons		2,498		2,944		5,052		2,416		2,241
	Natural Gas		MMBtus		11,127		7,647		15,703		13		15
	Heating Oil and
		Gasoline	Gallons		858		440		1,041		494		471
	Interest Rate		USD	$	29,011	$	19,936	$	40,940	$	-	$	-
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	-
Notional Volume of Derivative Instruments
December 31, 2011
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		169,459		109,326		229,468		39		49
	Coal		Tons		3,714		1,920		8,337		3,574		2,974
	Natural Gas		MMBtus		7,923		5,081		10,728		115		145
	Heating Oil and
		Gasoline	Gallons		1,057		525		1,254		618		569
	Interest Rate		USD	$	31,029	$	19,890	$	42,093	$	175	$	203
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	200,069

Cash Collateral Netting

	September 30, 2012				December 31, 2011
	Cash Collateral		Cash Collateral		Cash Collateral		Cash Collateral
	Received		Paid		Received		Paid
	Netted Against		Netted Against		Netted Against		Netted Against
	Risk Management		Risk Management		Risk Management		Risk Management
Company	Assets		Liabilities		Assets		Liabilities
	(in thousands)
APCo	$	2,375	$	10,408	$	4,291	$	28,964
I&M		1,632		7,151		2,752		18,547
OPCo		3,352		14,687		5,810		39,183
PSO		5		9		53		130
SWEPCo		6		9		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
September 30, 2012
PSO
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	4,868	$	54	$	-	$	(4,377)	$	545
Long-term Risk Management Assets			300		4		-		(180)		124
Total Assets			5,168		58		-		(4,557)		669
Current Risk Management Liabilities			9,435		13		-		(4,377)		5,071
Long-term Risk Management Liabilities			1,230		5		-		(184)		1,051
Total Liabilities			10,665		18		-		(4,561)		6,122
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	(5,497)	$	40	$	-	$	4	$	(5,453)
Fair Value of Derivative Instruments
December 31, 2011
PSO
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	6,980	$	-	$	-	$	(6,415)	$	565
Long-term Risk Management Assets			914		-		-		(600)		314
Total Assets			7,894		-		-		(7,015)		879
Current Risk Management Liabilities			7,665		107		-		(6,492)		1,280
Long-term Risk Management Liabilities			1,930		-		-		(600)		1,330
Total Liabilities			9,595		107		-		(7,092)		2,610
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	(1,701)	$	(107)	$	-	$	77	$	(1,731)

(a) Derivative instruments within these categories are reported gross. These instruments are subject to master netting agreements and are presented on the condensed balance sheets on a net basis in accordance with the accounting guidance for "Derivatives and Hedging."

(b) Amounts include counterparty netting of risk management and hedging contracts and associated cash collateral in accordance with the accounting guidance for "Derivatives and Hedging." Amounts also include de-designated risk management contracts.

Amount of Gain Loss Recognized on Risk Management Contracts

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	378	$	3,814	$	87	$	71	$	174
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(138)		(1,213)		3,000		598		115
Regulatory Liabilities (a)			(1,672)		(5,267)		(6,788)		2		11
Total Gain (Loss) on Risk Management
	Contracts	$	(1,432)	$	(2,666)	$	(3,701)	$	671	$	300
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	960	$	3,094	$	4,652	$	(530)	$	(186)
Sales to AEP Affiliates			103		58		126		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			139		71		(2,846)		(264)		(219)
Regulatory Liabilities (a)			(1,058)		(2,566)		26		1,930		174
Total Gain (Loss) on Risk Management
	Contracts	$	144	$	657	$	1,956	$	1,138	$	(229)

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(548)	$	9,206	$	11,118	$	231	$	426
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(6,133)		(7,228)		(9,026)		(5,360)		(6,977)
Regulatory Liabilities (a)			8,166		1,851		390		3		6
Total Gain (Loss) on Risk Management
	Contracts	$	1,485	$	3,829	$	2,482	$	(5,126)	$	(6,545)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	3,659	$	12,211	$	26,806	$	128	$	340
Sales to AEP Affiliates			136		81		171		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			373		186		(7,028)		285		2,975
Regulatory Liabilities (a)			9,827		(4,230)		(105)		2,509		58
Total Gain (Loss) on Risk Management
	Contracts	$	13,995	$	8,248	$	19,842	$	2,924	$	3,375
(a) Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current
or noncurrent on the condensed balance sheet.

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Changes in Fair Value Recognized in AOCI					1,302		887		1,915		126		123
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Changes in Fair Value Recognized in AOCI					-		(1,542)		1		1		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)
Changes in Fair Value Recognized in AOCI					1,302		(655)		1,916		127		122
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Changes in Fair Value Recognized in AOCI					(646)		(332)		(765)		(162)		(148)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Changes in Fair Value Recognized in AOCI					-		(4,764)		-		-		(10,896)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
Changes in Fair Value Recognized in AOCI					(646)		(5,096)		(765)		(162)		(11,044)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(1,309)	$	(819)	$	(1,748)	$	(69)	$	(62)
Changes in Fair Value Recognized in AOCI					(946)		(741)		(1,487)		110		106
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	1,024	$	(14,465)	$	9,454	$	7,218	$	(15,462)
Changes in Fair Value Recognized in AOCI					-		(6,390)		1		1		(2,778)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(285)	$	(15,284)	$	7,706	$	7,149	$	(15,524)
Changes in Fair Value Recognized in AOCI					(946)		(7,131)		(1,486)		111		(2,672)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(273)	$	(178)	$	(364)	$	88	$	82
Changes in Fair Value Recognized in AOCI					(523)		(279)		(622)		18		20
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	217	$	(8,507)	$	10,813	$	8,406	$	(4,272)
Changes in Fair Value Recognized in AOCI					(373)		(4,764)		-		(476)		(10,095)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(56)	$	(8,685)	$	10,449	$	8,494	$	(4,190)
Changes in Fair Value Recognized in AOCI					(896)		(5,043)		(622)		(458)		(10,075)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)
(a)			Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current or noncurrent on the condensed balance sheets.

Impact of Cash Flow Hedges on the Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
September 30, 2012
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	925	$	-	$	1,503	$	-	$	(362)	$	1,823
I&M		622		-		1,032		20,465		(257)		(20,408)
OPCo		1,289		-		2,120		-		(524)		8,435
PSO		46		-		6		-		34		6,650
SWEPCo		43		-		6		-		34		(16,240)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
					Maximum Term for
			Interest Rate		Exposure to
			and Foreign		Variability of Future
Company	Commodity		Currency		Cash Flows
	(in thousands)				(in months)
APCo	$	(278)	$	(1,013)		20
I&M		(202)		(1,316)		20
OPCo		(405)		1,359		20
PSO		36		759		15
SWEPCo		34		(2,369)		15

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
December 31, 2011
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	431	$	-	$	2,418	$	-	$	(1,309)	$	1,024
I&M		277		-		1,523		10,637		(819)		(14,465)
OPCo		584		-		3,239		-		(1,748)		9,454
PSO		-		-		107		-		(69)		7,218
SWEPCo		-		3		97		19,143		(62)		(15,462)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
			Interest Rate
			and Foreign
Company	Commodity		Currency
	(in thousands)
APCo	$	(1,140)	$	(1,052)
I&M		(712)		(595)
OPCo		(1,518)		1,359
PSO		(70)		759
SWEPCo		(63)		(1,864)

(a)       Hedging Assets and Hedging Liabilities are included in Risk Management Assets and Liabilities on the condensed balance sheets.

Collateral Required Under Various Triggering Events

	September 30, 2012
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	2,155	$	4,301	$	4,301
I&M		1,481		2,956		2,956
OPCo		3,042		6,070		6,070
PSO		-		1,288		885
SWEPCo		-		1,517		1,042

	December 31, 2011
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	10,007	$	6,211	$	6,211
I&M		6,418		3,983		3,983
OPCo		13,550		8,410		8,410
PSO		-		856		414
SWEPCo		-		1,128		522

Liabilities Subject to Cross Default Provisions

	September 30, 2012
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	64,466	$	76	$	33,019
I&M		64,767		52		43,156
OPCo		90,977		107		46,597
PSO		26		-		16
SWEPCo		30		-		19
	December 31, 2011
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	76,868	$	8,107	$	27,603
I&M		59,936		5,200		28,339
OPCo		104,091		10,978		37,380
PSO		142		-		61
SWEPCo		19,322		-		19,220

Southwestern Electric Power Co [Member]

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
September 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		142,425		98,176		200,993		14		16
	Coal		Tons		2,498		2,944		5,052		2,416		2,241
	Natural Gas		MMBtus		11,127		7,647		15,703		13		15
	Heating Oil and
		Gasoline	Gallons		858		440		1,041		494		471
	Interest Rate		USD	$	29,011	$	19,936	$	40,940	$	-	$	-
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	-
Notional Volume of Derivative Instruments
December 31, 2011
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		169,459		109,326		229,468		39		49
	Coal		Tons		3,714		1,920		8,337		3,574		2,974
	Natural Gas		MMBtus		7,923		5,081		10,728		115		145
	Heating Oil and
		Gasoline	Gallons		1,057		525		1,254		618		569
	Interest Rate		USD	$	31,029	$	19,890	$	42,093	$	175	$	203
Interest Rate and
	Foreign Currency		USD	$	-	$	200,000	$	-	$	-	$	200,069

Cash Collateral Netting

	September 30, 2012				December 31, 2011
	Cash Collateral		Cash Collateral		Cash Collateral		Cash Collateral
	Received		Paid		Received		Paid
	Netted Against		Netted Against		Netted Against		Netted Against
	Risk Management		Risk Management		Risk Management		Risk Management
Company	Assets		Liabilities		Assets		Liabilities
	(in thousands)
APCo	$	2,375	$	10,408	$	4,291	$	28,964
I&M		1,632		7,151		2,752		18,547
OPCo		3,352		14,687		5,810		39,183
PSO		5		9		53		130
SWEPCo		6		9		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
September 30, 2012
SWEPCo
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	7,888	$	51	$	-	$	(7,234)	$	705
Long-term Risk Management Assets			467		4		-		(293)		178
Total Assets			8,355		55		-		(7,527)		883
Current Risk Management Liabilities			11,369		12		-		(7,233)		4,148
Long-term Risk Management Liabilities			425		6		-		(297)		134
Total Liabilities			11,794		18		-		(7,530)		4,282
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	(3,439)	$	37	$	-	$	3	$	(3,399)
Fair Value of Derivative Instruments
December 31, 2011
SWEPCo
		Risk
		Management
		Contracts		Hedging Contracts
						Interest Rate
						and Foreign
Balance Sheet Location		Commodity (a)		Commodity (a)		Currency (a)		Other (b)		Total
		(in thousands)
Current Risk Management Assets		$	6,327	$	-	$	3	$	(5,885)	$	445
Long-term Risk Management Assets			818		-		-		(536)		282
Total Assets			7,145		-		3		(6,421)		727
Current Risk Management Liabilities			11,062		97		19,143		(5,943)		24,359
Long-term Risk Management Liabilities			757		-		-		(536)		221
Total Liabilities			11,819		97		19,143		(6,479)		24,580
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	(4,674)	$	(97)	$	(19,140)	$	58	$	(23,853)

(a) Derivative instruments within these categories are reported gross. These instruments are subject to master netting agreements and are presented on the condensed balance sheets on a net basis in accordance with the accounting guidance for "Derivatives and Hedging."

(b) Amounts include counterparty netting of risk management and hedging contracts and associated cash collateral in accordance with the accounting guidance for "Derivatives and Hedging." Amounts also include de-designated risk management contracts.

Amount of Gain Loss Recognized on Risk Management Contracts

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	378	$	3,814	$	87	$	71	$	174
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(138)		(1,213)		3,000		598		115
Regulatory Liabilities (a)			(1,672)		(5,267)		(6,788)		2		11
Total Gain (Loss) on Risk Management
	Contracts	$	(1,432)	$	(2,666)	$	(3,701)	$	671	$	300
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	960	$	3,094	$	4,652	$	(530)	$	(186)
Sales to AEP Affiliates			103		58		126		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			139		71		(2,846)		(264)		(219)
Regulatory Liabilities (a)			(1,058)		(2,566)		26		1,930		174
Total Gain (Loss) on Risk Management
	Contracts	$	144	$	657	$	1,956	$	1,138	$	(229)

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(548)	$	9,206	$	11,118	$	231	$	426
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(6,133)		(7,228)		(9,026)		(5,360)		(6,977)
Regulatory Liabilities (a)			8,166		1,851		390		3		6
Total Gain (Loss) on Risk Management
	Contracts	$	1,485	$	3,829	$	2,482	$	(5,126)	$	(6,545)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Nine Months Ended September 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	3,659	$	12,211	$	26,806	$	128	$	340
Sales to AEP Affiliates			136		81		171		2		2
Fuel and Other Consumables Used for
	Electric Generation		-		-		(2)		-		-
Regulatory Assets (a)			373		186		(7,028)		285		2,975
Regulatory Liabilities (a)			9,827		(4,230)		(105)		2,509		58
Total Gain (Loss) on Risk Management
	Contracts	$	13,995	$	8,248	$	19,842	$	2,924	$	3,375
(a) Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current
or noncurrent on the condensed balance sheet.

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Changes in Fair Value Recognized in AOCI					1,302		887		1,915		126		123
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Changes in Fair Value Recognized in AOCI					-		(1,542)		1		1		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)
Changes in Fair Value Recognized in AOCI					1,302		(655)		1,916		127		122
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(4)		(10)		(23)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			35		88		221		-		-
		Other Operation Expense			(4)		(1)		(6)		-		1
		Maintenance Expense			12		4		7		5		4
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			261		149		(341)		(190)		567
		Property, Plant and Equipment			3		1		1		5		3
		Regulatory Assets (a)			114		20		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Changes in Fair Value Recognized in AOCI					(646)		(332)		(765)		(162)		(148)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Changes in Fair Value Recognized in AOCI					-		(4,764)		-		-		(10,896)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
Changes in Fair Value Recognized in AOCI					(646)		(5,096)		(765)		(162)		(11,044)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		84		167		461		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(70)		(148)		(402)		-		-
		Other Operation Expense			(32)		(22)		(50)		(28)		(28)
		Maintenance Expense			(51)		(21)		(46)		(20)		(21)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		252		(340)		(190)		207
		Property, Plant and Equipment			(51)		(28)		(63)		(32)		(27)
		Regulatory Assets (a)			53		5		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(1,309)	$	(819)	$	(1,748)	$	(69)	$	(62)
Changes in Fair Value Recognized in AOCI					(946)		(741)		(1,487)		110		106
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	(362)	$	(257)	$	(524)	$	34	$	34
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	1,024	$	(14,465)	$	9,454	$	7,218	$	(15,462)
Changes in Fair Value Recognized in AOCI					-		(6,390)		1		1		(2,778)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
Balance in AOCI as of September 30, 2012				$	1,823	$	(20,408)	$	8,435	$	6,650	$	(16,240)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2011				$	(285)	$	(15,284)	$	7,706	$	7,149	$	(15,524)
Changes in Fair Value Recognized in AOCI					(946)		(7,131)		(1,486)		111		(2,672)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(7)		(19)		(47)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			411		1,074		2,806		-		-
		Other Operation Expense			(20)		(11)		(30)		(11)		(8)
		Maintenance Expense			3		-		(3)		3		1
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			799		447		(1,023)		(569)		2,000
		Property, Plant and Equipment			(9)		(6)		(15)		1		(3)
		Regulatory Assets (a)			1,515		265		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2012				$	1,461	$	(20,665)	$	7,911	$	6,684	$	(16,206)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Nine Months Ended September 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(273)	$	(178)	$	(364)	$	88	$	82
Changes in Fair Value Recognized in AOCI					(523)		(279)		(622)		18		20
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	(44)	$	(1)	$	(28)	$	(102)	$	(92)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	217	$	(8,507)	$	10,813	$	8,406	$	(4,272)
Changes in Fair Value Recognized in AOCI					(373)		(4,764)		-		(476)		(10,095)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Other Operation Expense			-		-		-		-		-
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
Balance in AOCI as of September 30, 2011				$	755	$	(12,516)	$	9,794	$	7,408	$	(13,746)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of December 31, 2010				$	(56)	$	(8,685)	$	10,449	$	8,494	$	(4,190)
Changes in Fair Value Recognized in AOCI					(896)		(5,043)		(622)		(458)		(10,075)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		255		553		1,495		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(24)		(46)		(127)		-		-
		Other Operation Expense			(76)		(59)		(133)		(75)		(74)
		Maintenance Expense			(141)		(53)		(116)		(49)		(53)
		Depreciation and Amortization
			Expense		-		-		3		-		-
		Interest Expense			911		755		(1,022)		(522)		621
		Property, Plant and Equipment			(131)		(67)		(161)		(84)		(67)
		Regulatory Assets (a)			869		128		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of September 30, 2011				$	711	$	(12,517)	$	9,766	$	7,306	$	(13,838)
(a)			Represents realized and unrealized gains and losses subject to regulatory accounting treatment recorded as either current or noncurrent on the condensed balance sheets.

Impact of Cash Flow Hedges on the Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
September 30, 2012
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	925	$	-	$	1,503	$	-	$	(362)	$	1,823
I&M		622		-		1,032		20,465		(257)		(20,408)
OPCo		1,289		-		2,120		-		(524)		8,435
PSO		46		-		6		-		34		6,650
SWEPCo		43		-		6		-		34		(16,240)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
					Maximum Term for
			Interest Rate		Exposure to
			and Foreign		Variability of Future
Company	Commodity		Currency		Cash Flows
	(in thousands)				(in months)
APCo	$	(278)	$	(1,013)		20
I&M		(202)		(1,316)		20
OPCo		(405)		1,359		20
PSO		36		759		15
SWEPCo		34		(2,369)		15

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
December 31, 2011
	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
			Interest Rate				Interest Rate				Interest Rate
			and Foreign				and Foreign				and Foreign
Company	Commodity		Currency		Commodity		Currency		Commodity		Currency
	(in thousands)
APCo	$	431	$	-	$	2,418	$	-	$	(1,309)	$	1,024
I&M		277		-		1,523		10,637		(819)		(14,465)
OPCo		584		-		3,239		-		(1,748)		9,454
PSO		-		-		107		-		(69)		7,218
SWEPCo		-		3		97		19,143		(62)		(15,462)

	Expected to be Reclassified to
	Net Income During the Next
	Twelve Months
			Interest Rate
			and Foreign
Company	Commodity		Currency
	(in thousands)
APCo	$	(1,140)	$	(1,052)
I&M		(712)		(595)
OPCo		(1,518)		1,359
PSO		(70)		759
SWEPCo		(63)		(1,864)

(a)       Hedging Assets and Hedging Liabilities are included in Risk Management Assets and Liabilities on the condensed balance sheets.

Collateral Required Under Various Triggering Events

	September 30, 2012
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	2,155	$	4,301	$	4,301
I&M		1,481		2,956		2,956
OPCo		3,042		6,070		6,070
PSO		-		1,288		885
SWEPCo		-		1,517		1,042

	December 31, 2011
	Liabilities for		Amount of Collateral the		Amount
	Derivative Contracts		Registrant Subsidiaries		Attributable to
	with Credit		Would Have Been		RTO and ISO
Company	Downgrade Triggers		Required to Post		Activities
	(in thousands)
APCo	$	10,007	$	6,211	$	6,211
I&M		6,418		3,983		3,983
OPCo		13,550		8,410		8,410
PSO		-		856		414
SWEPCo		-		1,128		522

Liabilities Subject to Cross Default Provisions

	September 30, 2012
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	64,466	$	76	$	33,019
I&M		64,767		52		43,156
OPCo		90,977		107		46,597
PSO		26		-		16
SWEPCo		30		-		19
	December 31, 2011
	Liabilities for				Additional
	Contracts with Cross				Settlement
	Default Provisions				Liability if Cross
	Prior to Contractual		Amount of Cash		Default Provision
Company	Netting Arrangements		Collateral Posted		is Triggered
	(in thousands)
APCo	$	76,868	$	8,107	$	27,603
I&M		59,936		5,200		28,339
OPCo		104,091		10,978		37,380
PSO		142		-		61
SWEPCo		19,322		-		19,220