Financing Activities

9 Months Ended

Sep. 30, 2016

Financing Activities

FINANCING ACTIVITIES

The disclosures in this note apply to all Registrants unless indicated otherwise.

Long-term Debt Outstanding (Applies to AEP)

The following table details long-term debt outstanding as of September 30, 2016 and December 31, 2015:

Type of Debt	September 30, 2016			December 31, 2015
	(in millions)
Senior Unsecured Notes	$	14,073.9	(a)	$	13,629.1
Pollution Control Bonds	1,724.5			1,784.8
Notes Payable	268.5			264.7
Securitization Bonds	1,737.6			2,024.0
Spent Nuclear Fuel Obligation (b)	266.1			265.6
Other Long-term Debt	1,768.9			1,604.5
Total Long-term Debt Outstanding	19,839.5		(a)	19,572.7
Long-term Debt Due Within One Year	2,519.6		(a)	1,831.8
Long-term Debt	$	17,319.9		$	17,740.9

(a) Amounts include debt related to the Lawrenceburg Plant that has been classified as Liabilities Held for Sale on the balance sheet. See “Gavin, Waterford, Darby and Lawrenceburg Plants (Generation & Marketing Segment)” section of Note 6 for additional information.

(b) Pursuant to the Nuclear Waste Policy Act of 1982, I&M, a nuclear licensee, has an obligation to the United States Department of Energy for spent nuclear fuel disposal.  The obligation includes a one-time fee for nuclear fuel consumed prior to April 7, 1983.  Trust fund assets related to this obligation were $309 million and $309 million as of September 30, 2016 and December 31, 2015, respectively, and are included in Spent Nuclear Fuel and Decommissioning Trusts on the balance sheets.

Long-term Debt Activity

Long-term debt and other securities issued, retired and principal payments made during the first nine months of 2016 are shown in the tables below:

Company	Type of Debt	Principal Amount (a)		Interest Rate	Due Date
Issuances:		(in millions)		(%)
APCo	Other Long-term Debt	$	125.0	Variable	2019
APCo	Pollution Control Bonds	125.3		Variable	2016
APCo	Pollution Control Bonds	65.4		1.70	2020
I&M	Notes Payable	87.9		Variable	2020
I&M	Senior Unsecured Notes	400.0		4.55	2046
PSO	Senior Unsecured Notes	50.0		3.05	2026
PSO	Senior Unsecured Notes	100.0		4.11	2046
SWEPCo	Other Long-term Debt	5.2		3.50	2023
SWEPCo	Senior Unsecured Notes	400.0		2.75	2026
Non-Registrant:
TCC	Other Long-term Debt	125.0		Variable	2019
TNC	Other Long-term Debt	75.0		Variable	2019
Transource Missouri	Other Long-term Debt	11.5		Variable	2018
Total Issuances		$	1,570.3

(a) Amounts indicated on the statements of cash flows are net of issuance costs and premium or discount and will not tie to the issuance amounts.

Company	Type of Debt	Principal Amount Paid		Interest Rate	Due Date
Retirements and Principal Payments:		(in millions)		(%)
APCo	Pollution Control Bonds	$	125.3	Variable	2016
APCo	Pollution Control Bonds	65.3		2.25	2016
APCo	Securitization Bonds	23.0		2.008	2024
I&M	Notes Payable	0.8		Variable	2016
I&M	Notes Payable	0.5		2.12	2016
I&M	Notes Payable	12.6		Variable	2017
I&M	Notes Payable	24.8		Variable	2019
I&M	Notes Payable	31.0		Variable	2019
I&M	Notes Payable	6.1		Variable	2020
I&M	Other Long-term Debt	1.0		6.00	2025
OPCo	Other Long-term Debt	0.1		1.149	2028
OPCo	Securitization Bonds	45.8		0.958	2018
OPCo	Senior Unsecured Notes	350.0		6.00	2016
PSO	Other Long-term Debt	0.3		3.00	2027
PSO	Senior Unsecured Notes	150.0		6.15	2016
SWEPCo	Notes Payable	3.3		4.58	2032
Non-Registrant:
AEGCo	Senior Unsecured Notes	7.3		6.33	2037
AEP Subsidiaries	Notes Payable	5.1		Variable	2017
AEP Subsidiaries	Notes Payable	0.1		5.75	2021
AGR	Pollution Control Bonds	60.0		Variable	2016
TCC	Other Long-term Debt	100.0		Variable	2016
TCC	Securitization Bonds	44.2		6.25	2016
TCC	Securitization Bonds	149.1		5.17	2018
TCC	Securitization Bonds	26.9		0.88	2017
TNC	Other Long-term Debt	75.0		Variable	2016
Total Retirements and Principal Payments		$	1,307.6

In October 2016, I&M retired $16 million of Notes Payable related to DCC Fuel.

As of September 30, 2016, trustees held, on behalf of AEP, $614 million of their reacquired Pollution Control Bonds. Of this total, $40 million and $345 million related to I&M and OPCo, respectively.

Dividend Restrictions

Parent Restrictions (Applies to AEP)

The holders of AEP’s common stock are entitled to receive the dividends declared by the Board of Directors provided funds are legally available for such dividends. Parent’s income primarily derives from common stock equity in the earnings of its utility subsidiaries.

Pursuant to the leverage restrictions in credit agreements, AEP must maintain a percentage of debt to total capitalization at a level that does not exceed 67.5%. The payment of cash dividends indirectly results in an increase in the percentage of debt to total capitalization of the company distributing the dividend. The method for calculating outstanding debt and capitalization is contractually defined in the credit agreements. As of September 30, 2016, none of AEP’s retained earnings were restricted for the purpose of the payment of dividends.

Utility Subsidiaries’ Restrictions

AEP utility subsidiaries pay dividends to Parent provided funds are legally available. Various financing arrangements and regulatory requirements may impose certain restrictions on the ability of the subsidiaries to transfer funds to Parent in the form of dividends.

Certain AEP subsidiaries have credit agreements that contain a covenant that limits their debt to capitalization ratio to 67.5%.

The Federal Power Act prohibits the utility subsidiaries from participating “in the making or paying of any dividends of such public utility from any funds properly included in capital account.” Additionally, the Federal Power Act creates a reserve on earnings attributable to hydroelectric generation plants. Because of their ownership of such plants, this reserve applies to AGR, APCo and I&M. As of September 30, 2016, these restrictions did not limit the ability of the subsidiaries to pay dividends out of retained earnings.

Corporate Borrowing Program - AEP System (Applies to Registrant Subsidiaries)

The AEP System uses a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries.  The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries, and a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries.  The AEP System Utility Money Pool operates in accordance with the terms and conditions of the AEP System Utility Money Pool agreement filed with the FERC.  The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates and Advances from Affiliates, respectively, on each of the Registrant Subsidiaries’ balance sheets.  The Utility Money Pool participants’ money pool activity and their corresponding authorized borrowing limits for the nine months ended September 30, 2016 are described in the following table:

	Maximum				Average				Net Loans to
	Borrowings		Maximum		Borrowings		Average		(Borrowings from)			Authorized
	from the		Loans to the		from the		Loans to the		the Utility Money			Short-term
	Utility		Utility		Utility		Utility		Pool as of			Borrowing
Company	Money Pool		Money Pool		Money Pool		Money Pool		September 30, 2016			Limit
	(in millions)
APCo	$	286.9	$	25.7	$	165.5	$	24.9	$	(59.7	)	$	600.0
I&M	369.1		97.6		118.9		21.8		(13.9		)	500.0
OPCo	227.9		379.2		137.8		251.1		0.2			400.0
PSO	9.6		205.4		5.1		47.0		51.1			300.0
SWEPCo	249.4		308.2		171.8		302.8		297.4			350.0

The activity in the above table does not include short-term lending activity of SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC, which is a participant in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates on SWEPCo’s balance sheets. For the nine months ended September 30, 2016, Mutual Energy SWEPCo, LLC had the following activity in the Nonutility Money Pool:

Maximum		Average		Loans
Loans		Loans		to the Nonutility
to the Nonutility		to the Nonutility		Money Pool as of
Money Pool		Money Pool		September 30, 2016
(in millions)
$	2.0	$	2.0	$	2.0

The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool were as follows:

	Nine Months Ended September 30,
	2016		2015
Maximum Interest Rate	0.91	%	0.59	%
Minimum Interest Rate	0.69	%	0.39	%

The average interest rates for funds borrowed from and loaned to the Utility Money Pool for the nine months ended September 30, 2016 and 2015 are summarized for all Registrant Subsidiaries in the following table:

	Average Interest Rate				Average Interest Rate
	for Funds Borrowed				for Funds Loaned
	from the Utility Money Pool for				to the Utility Money Pool for
	Nine Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
APCo	0.78	%	0.46	%	0.79	%	0.46	%
I&M	0.73	%	0.47	%	0.78	%	0.46	%
OPCo	0.85	%	—	%	0.74	%	0.47	%
PSO	0.76	%	0.49	%	0.81	%	0.46	%
SWEPCo	0.79	%	0.46	%	0.91	%	0.48	%

Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool for the nine months ended September 30, 2016 are summarized for Mutual Energy SWEPCo, LLC in the following table:

Maximum		Minimum		Average
Interest Rate		Interest Rate		Interest Rate
for Funds		for Funds		for Funds
Loaned to		Loaned to		Loaned to
the Nonutility		the Nonutility		the Nonutility
Money Pool		Money Pool		Money Pool
0.91	%	0.69	%	0.79	%

Short-term Debt (Applies to AEP)

Outstanding short-term debt was as follows:

	September 30, 2016				December 31, 2015
Type of Debt	Outstanding Amount		Interest Rate (a)		Outstanding Amount		Interest Rate (a)
	(in millions)				(in millions)
Securitized Debt for Receivables (b)	$	750.0	0.65	%	$	675.0	0.30	%
Commercial Paper	728.3		0.90	%	125.0		0.81	%
Total Short-term Debt	$	1,478.3			$	800.0

(a) Weighted average rate.

(b) Amount of securitized debt for receivables as accounted for under the “Transfers and Servicing” accounting guidance.

Credit Facilities

For a discussion of credit facilities, see “Letters of Credit” section of Note 5.

Sale of Receivables – AEP Credit (Applies to AEP)

AEP Credit has a receivables securitization agreement with bank conduits.  Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries.  These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections.

AEP Credit’s receivables securitization agreement provides a commitment of $750 million from bank conduits to purchase receivables and expires in June 2018.

Accounts receivable information for AEP Credit is as follows:

	Three Months Ended   September 30,						Nine Months Ended   September 30,
	2016			2015			2016			2015
	(dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable	0.73		%	0.30		%	0.65		%	0.28		%
Net Uncollectible Accounts Receivable Written Off	$	7.7		$	13.5		$	17.5		$	27.5

	September 30, 2016		December 31, 2015
	(in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts	$	1,037.7	$	924.8
Total Principal Outstanding	750.0		675.0
Delinquent Securitized Accounts Receivable	47.7		48.3
Bad Debt Reserves Related to Securitization of Accounts Receivable	27.8		17.5
Unbilled Receivables Related to Securitization of Accounts Receivable	297.1		357.8

AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due.

Sale of Receivables – AEP Credit (Applies to Registrant Subsidiaries)

Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables.  APCo does not have regulatory authority to sell its West Virginia accounts receivable.  The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income.  The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder.

The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement for each Registrant Subsidiary as of September 30, 2016 and December 31, 2015 was as follows:

Company	September 30, 2016		December 31, 2015
	(in millions)
APCo	$	131.9	$	135.4
I&M	152.5		134.8
OPCo	407.1		351.4
PSO	146.1		116.1
SWEPCo	170.0		151.8

The fees paid by the Registrant Subsidiaries to AEP Credit for customer accounts receivable sold were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	1.6	$	2.0	$	5.4	$	6.0
I&M	2.0		2.2		5.6		6.6
OPCo	8.1		8.5		23.4		23.2
PSO	1.8		1.7		4.7		4.5
SWEPCo	2.1		2.0		5.3		5.3

The Registrant Subsidiaries’ proceeds on the sale of receivables to AEP Credit were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	361.7	$	355.3	$	1,071.6	$	1,115.5
I&M	448.0		401.5		1,220.2		1,192.1
OPCo	750.9		670.7		2,011.2		1,949.0
PSO	390.6		411.5		971.9		1,025.9
SWEPCo	460.4		468.0		1,183.9		1,222.3

Appalachian Power Co [Member]

Financing Activities

FINANCING ACTIVITIES

The disclosures in this note apply to all Registrants unless indicated otherwise.

Long-term Debt Outstanding (Applies to AEP)

The following table details long-term debt outstanding as of September 30, 2016 and December 31, 2015:

Type of Debt	September 30, 2016			December 31, 2015
	(in millions)
Senior Unsecured Notes	$	14,073.9	(a)	$	13,629.1
Pollution Control Bonds	1,724.5			1,784.8
Notes Payable	268.5			264.7
Securitization Bonds	1,737.6			2,024.0
Spent Nuclear Fuel Obligation (b)	266.1			265.6
Other Long-term Debt	1,768.9			1,604.5
Total Long-term Debt Outstanding	19,839.5		(a)	19,572.7
Long-term Debt Due Within One Year	2,519.6		(a)	1,831.8
Long-term Debt	$	17,319.9		$	17,740.9

(a) Amounts include debt related to the Lawrenceburg Plant that has been classified as Liabilities Held for Sale on the balance sheet. See “Gavin, Waterford, Darby and Lawrenceburg Plants (Generation & Marketing Segment)” section of Note 6 for additional information.

(b) Pursuant to the Nuclear Waste Policy Act of 1982, I&M, a nuclear licensee, has an obligation to the United States Department of Energy for spent nuclear fuel disposal.  The obligation includes a one-time fee for nuclear fuel consumed prior to April 7, 1983.  Trust fund assets related to this obligation were $309 million and $309 million as of September 30, 2016 and December 31, 2015, respectively, and are included in Spent Nuclear Fuel and Decommissioning Trusts on the balance sheets.

Long-term Debt Activity

Long-term debt and other securities issued, retired and principal payments made during the first nine months of 2016 are shown in the tables below:

Company	Type of Debt	Principal Amount (a)		Interest Rate	Due Date
Issuances:		(in millions)		(%)
APCo	Other Long-term Debt	$	125.0	Variable	2019
APCo	Pollution Control Bonds	125.3		Variable	2016
APCo	Pollution Control Bonds	65.4		1.70	2020
I&M	Notes Payable	87.9		Variable	2020
I&M	Senior Unsecured Notes	400.0		4.55	2046
PSO	Senior Unsecured Notes	50.0		3.05	2026
PSO	Senior Unsecured Notes	100.0		4.11	2046
SWEPCo	Other Long-term Debt	5.2		3.50	2023
SWEPCo	Senior Unsecured Notes	400.0		2.75	2026
Non-Registrant:
TCC	Other Long-term Debt	125.0		Variable	2019
TNC	Other Long-term Debt	75.0		Variable	2019
Transource Missouri	Other Long-term Debt	11.5		Variable	2018
Total Issuances		$	1,570.3

(a) Amounts indicated on the statements of cash flows are net of issuance costs and premium or discount and will not tie to the issuance amounts.

Company	Type of Debt	Principal Amount Paid		Interest Rate	Due Date
Retirements and Principal Payments:		(in millions)		(%)
APCo	Pollution Control Bonds	$	125.3	Variable	2016
APCo	Pollution Control Bonds	65.3		2.25	2016
APCo	Securitization Bonds	23.0		2.008	2024
I&M	Notes Payable	0.8		Variable	2016
I&M	Notes Payable	0.5		2.12	2016
I&M	Notes Payable	12.6		Variable	2017
I&M	Notes Payable	24.8		Variable	2019
I&M	Notes Payable	31.0		Variable	2019
I&M	Notes Payable	6.1		Variable	2020
I&M	Other Long-term Debt	1.0		6.00	2025
OPCo	Other Long-term Debt	0.1		1.149	2028
OPCo	Securitization Bonds	45.8		0.958	2018
OPCo	Senior Unsecured Notes	350.0		6.00	2016
PSO	Other Long-term Debt	0.3		3.00	2027
PSO	Senior Unsecured Notes	150.0		6.15	2016
SWEPCo	Notes Payable	3.3		4.58	2032
Non-Registrant:
AEGCo	Senior Unsecured Notes	7.3		6.33	2037
AEP Subsidiaries	Notes Payable	5.1		Variable	2017
AEP Subsidiaries	Notes Payable	0.1		5.75	2021
AGR	Pollution Control Bonds	60.0		Variable	2016
TCC	Other Long-term Debt	100.0		Variable	2016
TCC	Securitization Bonds	44.2		6.25	2016
TCC	Securitization Bonds	149.1		5.17	2018
TCC	Securitization Bonds	26.9		0.88	2017
TNC	Other Long-term Debt	75.0		Variable	2016
Total Retirements and Principal Payments		$	1,307.6

In October 2016, I&M retired $16 million of Notes Payable related to DCC Fuel.

As of September 30, 2016, trustees held, on behalf of AEP, $614 million of their reacquired Pollution Control Bonds. Of this total, $40 million and $345 million related to I&M and OPCo, respectively.

Dividend Restrictions

Parent Restrictions (Applies to AEP)

The holders of AEP’s common stock are entitled to receive the dividends declared by the Board of Directors provided funds are legally available for such dividends. Parent’s income primarily derives from common stock equity in the earnings of its utility subsidiaries.

Pursuant to the leverage restrictions in credit agreements, AEP must maintain a percentage of debt to total capitalization at a level that does not exceed 67.5%. The payment of cash dividends indirectly results in an increase in the percentage of debt to total capitalization of the company distributing the dividend. The method for calculating outstanding debt and capitalization is contractually defined in the credit agreements. As of September 30, 2016, none of AEP’s retained earnings were restricted for the purpose of the payment of dividends.

Utility Subsidiaries’ Restrictions

AEP utility subsidiaries pay dividends to Parent provided funds are legally available. Various financing arrangements and regulatory requirements may impose certain restrictions on the ability of the subsidiaries to transfer funds to Parent in the form of dividends.

Certain AEP subsidiaries have credit agreements that contain a covenant that limits their debt to capitalization ratio to 67.5%.

The Federal Power Act prohibits the utility subsidiaries from participating “in the making or paying of any dividends of such public utility from any funds properly included in capital account.” Additionally, the Federal Power Act creates a reserve on earnings attributable to hydroelectric generation plants. Because of their ownership of such plants, this reserve applies to AGR, APCo and I&M. As of September 30, 2016, these restrictions did not limit the ability of the subsidiaries to pay dividends out of retained earnings.

Corporate Borrowing Program - AEP System (Applies to Registrant Subsidiaries)

The AEP System uses a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries.  The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries, and a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries.  The AEP System Utility Money Pool operates in accordance with the terms and conditions of the AEP System Utility Money Pool agreement filed with the FERC.  The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates and Advances from Affiliates, respectively, on each of the Registrant Subsidiaries’ balance sheets.  The Utility Money Pool participants’ money pool activity and their corresponding authorized borrowing limits for the nine months ended September 30, 2016 are described in the following table:

	Maximum				Average				Net Loans to
	Borrowings		Maximum		Borrowings		Average		(Borrowings from)			Authorized
	from the		Loans to the		from the		Loans to the		the Utility Money			Short-term
	Utility		Utility		Utility		Utility		Pool as of			Borrowing
Company	Money Pool		Money Pool		Money Pool		Money Pool		September 30, 2016			Limit
	(in millions)
APCo	$	286.9	$	25.7	$	165.5	$	24.9	$	(59.7	)	$	600.0
I&M	369.1		97.6		118.9		21.8		(13.9		)	500.0
OPCo	227.9		379.2		137.8		251.1		0.2			400.0
PSO	9.6		205.4		5.1		47.0		51.1			300.0
SWEPCo	249.4		308.2		171.8		302.8		297.4			350.0

The activity in the above table does not include short-term lending activity of SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC, which is a participant in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates on SWEPCo’s balance sheets. For the nine months ended September 30, 2016, Mutual Energy SWEPCo, LLC had the following activity in the Nonutility Money Pool:

Maximum		Average		Loans
Loans		Loans		to the Nonutility
to the Nonutility		to the Nonutility		Money Pool as of
Money Pool		Money Pool		September 30, 2016
(in millions)
$	2.0	$	2.0	$	2.0

The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool were as follows:

	Nine Months Ended September 30,
	2016		2015
Maximum Interest Rate	0.91	%	0.59	%
Minimum Interest Rate	0.69	%	0.39	%

The average interest rates for funds borrowed from and loaned to the Utility Money Pool for the nine months ended September 30, 2016 and 2015 are summarized for all Registrant Subsidiaries in the following table:

	Average Interest Rate				Average Interest Rate
	for Funds Borrowed				for Funds Loaned
	from the Utility Money Pool for				to the Utility Money Pool for
	Nine Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
APCo	0.78	%	0.46	%	0.79	%	0.46	%
I&M	0.73	%	0.47	%	0.78	%	0.46	%
OPCo	0.85	%	—	%	0.74	%	0.47	%
PSO	0.76	%	0.49	%	0.81	%	0.46	%
SWEPCo	0.79	%	0.46	%	0.91	%	0.48	%

Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool for the nine months ended September 30, 2016 are summarized for Mutual Energy SWEPCo, LLC in the following table:

Maximum		Minimum		Average
Interest Rate		Interest Rate		Interest Rate
for Funds		for Funds		for Funds
Loaned to		Loaned to		Loaned to
the Nonutility		the Nonutility		the Nonutility
Money Pool		Money Pool		Money Pool
0.91	%	0.69	%	0.79	%

Short-term Debt (Applies to AEP)

Outstanding short-term debt was as follows:

	September 30, 2016				December 31, 2015
Type of Debt	Outstanding Amount		Interest Rate (a)		Outstanding Amount		Interest Rate (a)
	(in millions)				(in millions)
Securitized Debt for Receivables (b)	$	750.0	0.65	%	$	675.0	0.30	%
Commercial Paper	728.3		0.90	%	125.0		0.81	%
Total Short-term Debt	$	1,478.3			$	800.0

(a) Weighted average rate.

(b) Amount of securitized debt for receivables as accounted for under the “Transfers and Servicing” accounting guidance.

Credit Facilities

For a discussion of credit facilities, see “Letters of Credit” section of Note 5.

Sale of Receivables – AEP Credit (Applies to AEP)

AEP Credit has a receivables securitization agreement with bank conduits.  Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries.  These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections.

AEP Credit’s receivables securitization agreement provides a commitment of $750 million from bank conduits to purchase receivables and expires in June 2018.

Accounts receivable information for AEP Credit is as follows:

	Three Months Ended   September 30,						Nine Months Ended   September 30,
	2016			2015			2016			2015
	(dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable	0.73		%	0.30		%	0.65		%	0.28		%
Net Uncollectible Accounts Receivable Written Off	$	7.7		$	13.5		$	17.5		$	27.5

	September 30, 2016		December 31, 2015
	(in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts	$	1,037.7	$	924.8
Total Principal Outstanding	750.0		675.0
Delinquent Securitized Accounts Receivable	47.7		48.3
Bad Debt Reserves Related to Securitization of Accounts Receivable	27.8		17.5
Unbilled Receivables Related to Securitization of Accounts Receivable	297.1		357.8

AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due.

Sale of Receivables – AEP Credit (Applies to Registrant Subsidiaries)

Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables.  APCo does not have regulatory authority to sell its West Virginia accounts receivable.  The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income.  The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder.

The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement for each Registrant Subsidiary as of September 30, 2016 and December 31, 2015 was as follows:

Company	September 30, 2016		December 31, 2015
	(in millions)
APCo	$	131.9	$	135.4
I&M	152.5		134.8
OPCo	407.1		351.4
PSO	146.1		116.1
SWEPCo	170.0		151.8

The fees paid by the Registrant Subsidiaries to AEP Credit for customer accounts receivable sold were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	1.6	$	2.0	$	5.4	$	6.0
I&M	2.0		2.2		5.6		6.6
OPCo	8.1		8.5		23.4		23.2
PSO	1.8		1.7		4.7		4.5
SWEPCo	2.1		2.0		5.3		5.3

The Registrant Subsidiaries’ proceeds on the sale of receivables to AEP Credit were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	361.7	$	355.3	$	1,071.6	$	1,115.5
I&M	448.0		401.5		1,220.2		1,192.1
OPCo	750.9		670.7		2,011.2		1,949.0
PSO	390.6		411.5		971.9		1,025.9
SWEPCo	460.4		468.0		1,183.9		1,222.3

Indiana Michigan Power Co [Member]

Financing Activities

FINANCING ACTIVITIES

The disclosures in this note apply to all Registrants unless indicated otherwise.

Long-term Debt Outstanding (Applies to AEP)

The following table details long-term debt outstanding as of September 30, 2016 and December 31, 2015:

Type of Debt	September 30, 2016			December 31, 2015
	(in millions)
Senior Unsecured Notes	$	14,073.9	(a)	$	13,629.1
Pollution Control Bonds	1,724.5			1,784.8
Notes Payable	268.5			264.7
Securitization Bonds	1,737.6			2,024.0
Spent Nuclear Fuel Obligation (b)	266.1			265.6
Other Long-term Debt	1,768.9			1,604.5
Total Long-term Debt Outstanding	19,839.5		(a)	19,572.7
Long-term Debt Due Within One Year	2,519.6		(a)	1,831.8
Long-term Debt	$	17,319.9		$	17,740.9

(a) Amounts include debt related to the Lawrenceburg Plant that has been classified as Liabilities Held for Sale on the balance sheet. See “Gavin, Waterford, Darby and Lawrenceburg Plants (Generation & Marketing Segment)” section of Note 6 for additional information.

(b) Pursuant to the Nuclear Waste Policy Act of 1982, I&M, a nuclear licensee, has an obligation to the United States Department of Energy for spent nuclear fuel disposal.  The obligation includes a one-time fee for nuclear fuel consumed prior to April 7, 1983.  Trust fund assets related to this obligation were $309 million and $309 million as of September 30, 2016 and December 31, 2015, respectively, and are included in Spent Nuclear Fuel and Decommissioning Trusts on the balance sheets.

Long-term Debt Activity

Long-term debt and other securities issued, retired and principal payments made during the first nine months of 2016 are shown in the tables below:

Company	Type of Debt	Principal Amount (a)		Interest Rate	Due Date
Issuances:		(in millions)		(%)
APCo	Other Long-term Debt	$	125.0	Variable	2019
APCo	Pollution Control Bonds	125.3		Variable	2016
APCo	Pollution Control Bonds	65.4		1.70	2020
I&M	Notes Payable	87.9		Variable	2020
I&M	Senior Unsecured Notes	400.0		4.55	2046
PSO	Senior Unsecured Notes	50.0		3.05	2026
PSO	Senior Unsecured Notes	100.0		4.11	2046
SWEPCo	Other Long-term Debt	5.2		3.50	2023
SWEPCo	Senior Unsecured Notes	400.0		2.75	2026
Non-Registrant:
TCC	Other Long-term Debt	125.0		Variable	2019
TNC	Other Long-term Debt	75.0		Variable	2019
Transource Missouri	Other Long-term Debt	11.5		Variable	2018
Total Issuances		$	1,570.3

(a) Amounts indicated on the statements of cash flows are net of issuance costs and premium or discount and will not tie to the issuance amounts.

Company	Type of Debt	Principal Amount Paid		Interest Rate	Due Date
Retirements and Principal Payments:		(in millions)		(%)
APCo	Pollution Control Bonds	$	125.3	Variable	2016
APCo	Pollution Control Bonds	65.3		2.25	2016
APCo	Securitization Bonds	23.0		2.008	2024
I&M	Notes Payable	0.8		Variable	2016
I&M	Notes Payable	0.5		2.12	2016
I&M	Notes Payable	12.6		Variable	2017
I&M	Notes Payable	24.8		Variable	2019
I&M	Notes Payable	31.0		Variable	2019
I&M	Notes Payable	6.1		Variable	2020
I&M	Other Long-term Debt	1.0		6.00	2025
OPCo	Other Long-term Debt	0.1		1.149	2028
OPCo	Securitization Bonds	45.8		0.958	2018
OPCo	Senior Unsecured Notes	350.0		6.00	2016
PSO	Other Long-term Debt	0.3		3.00	2027
PSO	Senior Unsecured Notes	150.0		6.15	2016
SWEPCo	Notes Payable	3.3		4.58	2032
Non-Registrant:
AEGCo	Senior Unsecured Notes	7.3		6.33	2037
AEP Subsidiaries	Notes Payable	5.1		Variable	2017
AEP Subsidiaries	Notes Payable	0.1		5.75	2021
AGR	Pollution Control Bonds	60.0		Variable	2016
TCC	Other Long-term Debt	100.0		Variable	2016
TCC	Securitization Bonds	44.2		6.25	2016
TCC	Securitization Bonds	149.1		5.17	2018
TCC	Securitization Bonds	26.9		0.88	2017
TNC	Other Long-term Debt	75.0		Variable	2016
Total Retirements and Principal Payments		$	1,307.6

In October 2016, I&M retired $16 million of Notes Payable related to DCC Fuel.

As of September 30, 2016, trustees held, on behalf of AEP, $614 million of their reacquired Pollution Control Bonds. Of this total, $40 million and $345 million related to I&M and OPCo, respectively.

Dividend Restrictions

Parent Restrictions (Applies to AEP)

The holders of AEP’s common stock are entitled to receive the dividends declared by the Board of Directors provided funds are legally available for such dividends. Parent’s income primarily derives from common stock equity in the earnings of its utility subsidiaries.

Pursuant to the leverage restrictions in credit agreements, AEP must maintain a percentage of debt to total capitalization at a level that does not exceed 67.5%. The payment of cash dividends indirectly results in an increase in the percentage of debt to total capitalization of the company distributing the dividend. The method for calculating outstanding debt and capitalization is contractually defined in the credit agreements. As of September 30, 2016, none of AEP’s retained earnings were restricted for the purpose of the payment of dividends.

Utility Subsidiaries’ Restrictions

AEP utility subsidiaries pay dividends to Parent provided funds are legally available. Various financing arrangements and regulatory requirements may impose certain restrictions on the ability of the subsidiaries to transfer funds to Parent in the form of dividends.

Certain AEP subsidiaries have credit agreements that contain a covenant that limits their debt to capitalization ratio to 67.5%.

The Federal Power Act prohibits the utility subsidiaries from participating “in the making or paying of any dividends of such public utility from any funds properly included in capital account.” Additionally, the Federal Power Act creates a reserve on earnings attributable to hydroelectric generation plants. Because of their ownership of such plants, this reserve applies to AGR, APCo and I&M. As of September 30, 2016, these restrictions did not limit the ability of the subsidiaries to pay dividends out of retained earnings.

Corporate Borrowing Program - AEP System (Applies to Registrant Subsidiaries)

The AEP System uses a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries.  The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries, and a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries.  The AEP System Utility Money Pool operates in accordance with the terms and conditions of the AEP System Utility Money Pool agreement filed with the FERC.  The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates and Advances from Affiliates, respectively, on each of the Registrant Subsidiaries’ balance sheets.  The Utility Money Pool participants’ money pool activity and their corresponding authorized borrowing limits for the nine months ended September 30, 2016 are described in the following table:

	Maximum				Average				Net Loans to
	Borrowings		Maximum		Borrowings		Average		(Borrowings from)			Authorized
	from the		Loans to the		from the		Loans to the		the Utility Money			Short-term
	Utility		Utility		Utility		Utility		Pool as of			Borrowing
Company	Money Pool		Money Pool		Money Pool		Money Pool		September 30, 2016			Limit
	(in millions)
APCo	$	286.9	$	25.7	$	165.5	$	24.9	$	(59.7	)	$	600.0
I&M	369.1		97.6		118.9		21.8		(13.9		)	500.0
OPCo	227.9		379.2		137.8		251.1		0.2			400.0
PSO	9.6		205.4		5.1		47.0		51.1			300.0
SWEPCo	249.4		308.2		171.8		302.8		297.4			350.0

The activity in the above table does not include short-term lending activity of SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC, which is a participant in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates on SWEPCo’s balance sheets. For the nine months ended September 30, 2016, Mutual Energy SWEPCo, LLC had the following activity in the Nonutility Money Pool:

Maximum		Average		Loans
Loans		Loans		to the Nonutility
to the Nonutility		to the Nonutility		Money Pool as of
Money Pool		Money Pool		September 30, 2016
(in millions)
$	2.0	$	2.0	$	2.0

The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool were as follows:

	Nine Months Ended September 30,
	2016		2015
Maximum Interest Rate	0.91	%	0.59	%
Minimum Interest Rate	0.69	%	0.39	%

The average interest rates for funds borrowed from and loaned to the Utility Money Pool for the nine months ended September 30, 2016 and 2015 are summarized for all Registrant Subsidiaries in the following table:

	Average Interest Rate				Average Interest Rate
	for Funds Borrowed				for Funds Loaned
	from the Utility Money Pool for				to the Utility Money Pool for
	Nine Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
APCo	0.78	%	0.46	%	0.79	%	0.46	%
I&M	0.73	%	0.47	%	0.78	%	0.46	%
OPCo	0.85	%	—	%	0.74	%	0.47	%
PSO	0.76	%	0.49	%	0.81	%	0.46	%
SWEPCo	0.79	%	0.46	%	0.91	%	0.48	%

Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool for the nine months ended September 30, 2016 are summarized for Mutual Energy SWEPCo, LLC in the following table:

Maximum		Minimum		Average
Interest Rate		Interest Rate		Interest Rate
for Funds		for Funds		for Funds
Loaned to		Loaned to		Loaned to
the Nonutility		the Nonutility		the Nonutility
Money Pool		Money Pool		Money Pool
0.91	%	0.69	%	0.79	%

Short-term Debt (Applies to AEP)

Outstanding short-term debt was as follows:

	September 30, 2016				December 31, 2015
Type of Debt	Outstanding Amount		Interest Rate (a)		Outstanding Amount		Interest Rate (a)
	(in millions)				(in millions)
Securitized Debt for Receivables (b)	$	750.0	0.65	%	$	675.0	0.30	%
Commercial Paper	728.3		0.90	%	125.0		0.81	%
Total Short-term Debt	$	1,478.3			$	800.0

(a) Weighted average rate.

(b) Amount of securitized debt for receivables as accounted for under the “Transfers and Servicing” accounting guidance.

Credit Facilities

For a discussion of credit facilities, see “Letters of Credit” section of Note 5.

Sale of Receivables – AEP Credit (Applies to AEP)

AEP Credit has a receivables securitization agreement with bank conduits.  Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries.  These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections.

AEP Credit’s receivables securitization agreement provides a commitment of $750 million from bank conduits to purchase receivables and expires in June 2018.

Accounts receivable information for AEP Credit is as follows:

	Three Months Ended   September 30,						Nine Months Ended   September 30,
	2016			2015			2016			2015
	(dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable	0.73		%	0.30		%	0.65		%	0.28		%
Net Uncollectible Accounts Receivable Written Off	$	7.7		$	13.5		$	17.5		$	27.5

	September 30, 2016		December 31, 2015
	(in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts	$	1,037.7	$	924.8
Total Principal Outstanding	750.0		675.0
Delinquent Securitized Accounts Receivable	47.7		48.3
Bad Debt Reserves Related to Securitization of Accounts Receivable	27.8		17.5
Unbilled Receivables Related to Securitization of Accounts Receivable	297.1		357.8

AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due.

Sale of Receivables – AEP Credit (Applies to Registrant Subsidiaries)

Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables.  APCo does not have regulatory authority to sell its West Virginia accounts receivable.  The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income.  The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder.

The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement for each Registrant Subsidiary as of September 30, 2016 and December 31, 2015 was as follows:

Company	September 30, 2016		December 31, 2015
	(in millions)
APCo	$	131.9	$	135.4
I&M	152.5		134.8
OPCo	407.1		351.4
PSO	146.1		116.1
SWEPCo	170.0		151.8

The fees paid by the Registrant Subsidiaries to AEP Credit for customer accounts receivable sold were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	1.6	$	2.0	$	5.4	$	6.0
I&M	2.0		2.2		5.6		6.6
OPCo	8.1		8.5		23.4		23.2
PSO	1.8		1.7		4.7		4.5
SWEPCo	2.1		2.0		5.3		5.3

The Registrant Subsidiaries’ proceeds on the sale of receivables to AEP Credit were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	361.7	$	355.3	$	1,071.6	$	1,115.5
I&M	448.0		401.5		1,220.2		1,192.1
OPCo	750.9		670.7		2,011.2		1,949.0
PSO	390.6		411.5		971.9		1,025.9
SWEPCo	460.4		468.0		1,183.9		1,222.3

Ohio Power Co [Member]

Financing Activities

FINANCING ACTIVITIES

The disclosures in this note apply to all Registrants unless indicated otherwise.

Long-term Debt Outstanding (Applies to AEP)

The following table details long-term debt outstanding as of September 30, 2016 and December 31, 2015:

Type of Debt	September 30, 2016			December 31, 2015
	(in millions)
Senior Unsecured Notes	$	14,073.9	(a)	$	13,629.1
Pollution Control Bonds	1,724.5			1,784.8
Notes Payable	268.5			264.7
Securitization Bonds	1,737.6			2,024.0
Spent Nuclear Fuel Obligation (b)	266.1			265.6
Other Long-term Debt	1,768.9			1,604.5
Total Long-term Debt Outstanding	19,839.5		(a)	19,572.7
Long-term Debt Due Within One Year	2,519.6		(a)	1,831.8
Long-term Debt	$	17,319.9		$	17,740.9

(a) Amounts include debt related to the Lawrenceburg Plant that has been classified as Liabilities Held for Sale on the balance sheet. See “Gavin, Waterford, Darby and Lawrenceburg Plants (Generation & Marketing Segment)” section of Note 6 for additional information.

(b) Pursuant to the Nuclear Waste Policy Act of 1982, I&M, a nuclear licensee, has an obligation to the United States Department of Energy for spent nuclear fuel disposal.  The obligation includes a one-time fee for nuclear fuel consumed prior to April 7, 1983.  Trust fund assets related to this obligation were $309 million and $309 million as of September 30, 2016 and December 31, 2015, respectively, and are included in Spent Nuclear Fuel and Decommissioning Trusts on the balance sheets.

Long-term Debt Activity

Long-term debt and other securities issued, retired and principal payments made during the first nine months of 2016 are shown in the tables below:

Company	Type of Debt	Principal Amount (a)		Interest Rate	Due Date
Issuances:		(in millions)		(%)
APCo	Other Long-term Debt	$	125.0	Variable	2019
APCo	Pollution Control Bonds	125.3		Variable	2016
APCo	Pollution Control Bonds	65.4		1.70	2020
I&M	Notes Payable	87.9		Variable	2020
I&M	Senior Unsecured Notes	400.0		4.55	2046
PSO	Senior Unsecured Notes	50.0		3.05	2026
PSO	Senior Unsecured Notes	100.0		4.11	2046
SWEPCo	Other Long-term Debt	5.2		3.50	2023
SWEPCo	Senior Unsecured Notes	400.0		2.75	2026
Non-Registrant:
TCC	Other Long-term Debt	125.0		Variable	2019
TNC	Other Long-term Debt	75.0		Variable	2019
Transource Missouri	Other Long-term Debt	11.5		Variable	2018
Total Issuances		$	1,570.3

(a) Amounts indicated on the statements of cash flows are net of issuance costs and premium or discount and will not tie to the issuance amounts.

Company	Type of Debt	Principal Amount Paid		Interest Rate	Due Date
Retirements and Principal Payments:		(in millions)		(%)
APCo	Pollution Control Bonds	$	125.3	Variable	2016
APCo	Pollution Control Bonds	65.3		2.25	2016
APCo	Securitization Bonds	23.0		2.008	2024
I&M	Notes Payable	0.8		Variable	2016
I&M	Notes Payable	0.5		2.12	2016
I&M	Notes Payable	12.6		Variable	2017
I&M	Notes Payable	24.8		Variable	2019
I&M	Notes Payable	31.0		Variable	2019
I&M	Notes Payable	6.1		Variable	2020
I&M	Other Long-term Debt	1.0		6.00	2025
OPCo	Other Long-term Debt	0.1		1.149	2028
OPCo	Securitization Bonds	45.8		0.958	2018
OPCo	Senior Unsecured Notes	350.0		6.00	2016
PSO	Other Long-term Debt	0.3		3.00	2027
PSO	Senior Unsecured Notes	150.0		6.15	2016
SWEPCo	Notes Payable	3.3		4.58	2032
Non-Registrant:
AEGCo	Senior Unsecured Notes	7.3		6.33	2037
AEP Subsidiaries	Notes Payable	5.1		Variable	2017
AEP Subsidiaries	Notes Payable	0.1		5.75	2021
AGR	Pollution Control Bonds	60.0		Variable	2016
TCC	Other Long-term Debt	100.0		Variable	2016
TCC	Securitization Bonds	44.2		6.25	2016
TCC	Securitization Bonds	149.1		5.17	2018
TCC	Securitization Bonds	26.9		0.88	2017
TNC	Other Long-term Debt	75.0		Variable	2016
Total Retirements and Principal Payments		$	1,307.6

In October 2016, I&M retired $16 million of Notes Payable related to DCC Fuel.

As of September 30, 2016, trustees held, on behalf of AEP, $614 million of their reacquired Pollution Control Bonds. Of this total, $40 million and $345 million related to I&M and OPCo, respectively.

Dividend Restrictions

Parent Restrictions (Applies to AEP)

The holders of AEP’s common stock are entitled to receive the dividends declared by the Board of Directors provided funds are legally available for such dividends. Parent’s income primarily derives from common stock equity in the earnings of its utility subsidiaries.

Pursuant to the leverage restrictions in credit agreements, AEP must maintain a percentage of debt to total capitalization at a level that does not exceed 67.5%. The payment of cash dividends indirectly results in an increase in the percentage of debt to total capitalization of the company distributing the dividend. The method for calculating outstanding debt and capitalization is contractually defined in the credit agreements. As of September 30, 2016, none of AEP’s retained earnings were restricted for the purpose of the payment of dividends.

Utility Subsidiaries’ Restrictions

AEP utility subsidiaries pay dividends to Parent provided funds are legally available. Various financing arrangements and regulatory requirements may impose certain restrictions on the ability of the subsidiaries to transfer funds to Parent in the form of dividends.

Certain AEP subsidiaries have credit agreements that contain a covenant that limits their debt to capitalization ratio to 67.5%.

The Federal Power Act prohibits the utility subsidiaries from participating “in the making or paying of any dividends of such public utility from any funds properly included in capital account.” Additionally, the Federal Power Act creates a reserve on earnings attributable to hydroelectric generation plants. Because of their ownership of such plants, this reserve applies to AGR, APCo and I&M. As of September 30, 2016, these restrictions did not limit the ability of the subsidiaries to pay dividends out of retained earnings.

Corporate Borrowing Program - AEP System (Applies to Registrant Subsidiaries)

The AEP System uses a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries.  The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries, and a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries.  The AEP System Utility Money Pool operates in accordance with the terms and conditions of the AEP System Utility Money Pool agreement filed with the FERC.  The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates and Advances from Affiliates, respectively, on each of the Registrant Subsidiaries’ balance sheets.  The Utility Money Pool participants’ money pool activity and their corresponding authorized borrowing limits for the nine months ended September 30, 2016 are described in the following table:

	Maximum				Average				Net Loans to
	Borrowings		Maximum		Borrowings		Average		(Borrowings from)			Authorized
	from the		Loans to the		from the		Loans to the		the Utility Money			Short-term
	Utility		Utility		Utility		Utility		Pool as of			Borrowing
Company	Money Pool		Money Pool		Money Pool		Money Pool		September 30, 2016			Limit
	(in millions)
APCo	$	286.9	$	25.7	$	165.5	$	24.9	$	(59.7	)	$	600.0
I&M	369.1		97.6		118.9		21.8		(13.9		)	500.0
OPCo	227.9		379.2		137.8		251.1		0.2			400.0
PSO	9.6		205.4		5.1		47.0		51.1			300.0
SWEPCo	249.4		308.2		171.8		302.8		297.4			350.0

The activity in the above table does not include short-term lending activity of SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC, which is a participant in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates on SWEPCo’s balance sheets. For the nine months ended September 30, 2016, Mutual Energy SWEPCo, LLC had the following activity in the Nonutility Money Pool:

Maximum		Average		Loans
Loans		Loans		to the Nonutility
to the Nonutility		to the Nonutility		Money Pool as of
Money Pool		Money Pool		September 30, 2016
(in millions)
$	2.0	$	2.0	$	2.0

The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool were as follows:

	Nine Months Ended September 30,
	2016		2015
Maximum Interest Rate	0.91	%	0.59	%
Minimum Interest Rate	0.69	%	0.39	%

The average interest rates for funds borrowed from and loaned to the Utility Money Pool for the nine months ended September 30, 2016 and 2015 are summarized for all Registrant Subsidiaries in the following table:

	Average Interest Rate				Average Interest Rate
	for Funds Borrowed				for Funds Loaned
	from the Utility Money Pool for				to the Utility Money Pool for
	Nine Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
APCo	0.78	%	0.46	%	0.79	%	0.46	%
I&M	0.73	%	0.47	%	0.78	%	0.46	%
OPCo	0.85	%	—	%	0.74	%	0.47	%
PSO	0.76	%	0.49	%	0.81	%	0.46	%
SWEPCo	0.79	%	0.46	%	0.91	%	0.48	%

Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool for the nine months ended September 30, 2016 are summarized for Mutual Energy SWEPCo, LLC in the following table:

Maximum		Minimum		Average
Interest Rate		Interest Rate		Interest Rate
for Funds		for Funds		for Funds
Loaned to		Loaned to		Loaned to
the Nonutility		the Nonutility		the Nonutility
Money Pool		Money Pool		Money Pool
0.91	%	0.69	%	0.79	%

Short-term Debt (Applies to AEP)

Outstanding short-term debt was as follows:

	September 30, 2016				December 31, 2015
Type of Debt	Outstanding Amount		Interest Rate (a)		Outstanding Amount		Interest Rate (a)
	(in millions)				(in millions)
Securitized Debt for Receivables (b)	$	750.0	0.65	%	$	675.0	0.30	%
Commercial Paper	728.3		0.90	%	125.0		0.81	%
Total Short-term Debt	$	1,478.3			$	800.0

(a) Weighted average rate.

(b) Amount of securitized debt for receivables as accounted for under the “Transfers and Servicing” accounting guidance.

Credit Facilities

For a discussion of credit facilities, see “Letters of Credit” section of Note 5.

Sale of Receivables – AEP Credit (Applies to AEP)

AEP Credit has a receivables securitization agreement with bank conduits.  Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries.  These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections.

AEP Credit’s receivables securitization agreement provides a commitment of $750 million from bank conduits to purchase receivables and expires in June 2018.

Accounts receivable information for AEP Credit is as follows:

	Three Months Ended   September 30,						Nine Months Ended   September 30,
	2016			2015			2016			2015
	(dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable	0.73		%	0.30		%	0.65		%	0.28		%
Net Uncollectible Accounts Receivable Written Off	$	7.7		$	13.5		$	17.5		$	27.5

	September 30, 2016		December 31, 2015
	(in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts	$	1,037.7	$	924.8
Total Principal Outstanding	750.0		675.0
Delinquent Securitized Accounts Receivable	47.7		48.3
Bad Debt Reserves Related to Securitization of Accounts Receivable	27.8		17.5
Unbilled Receivables Related to Securitization of Accounts Receivable	297.1		357.8

AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due.

Sale of Receivables – AEP Credit (Applies to Registrant Subsidiaries)

Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables.  APCo does not have regulatory authority to sell its West Virginia accounts receivable.  The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income.  The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder.

The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement for each Registrant Subsidiary as of September 30, 2016 and December 31, 2015 was as follows:

Company	September 30, 2016		December 31, 2015
	(in millions)
APCo	$	131.9	$	135.4
I&M	152.5		134.8
OPCo	407.1		351.4
PSO	146.1		116.1
SWEPCo	170.0		151.8

The fees paid by the Registrant Subsidiaries to AEP Credit for customer accounts receivable sold were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	1.6	$	2.0	$	5.4	$	6.0
I&M	2.0		2.2		5.6		6.6
OPCo	8.1		8.5		23.4		23.2
PSO	1.8		1.7		4.7		4.5
SWEPCo	2.1		2.0		5.3		5.3

The Registrant Subsidiaries’ proceeds on the sale of receivables to AEP Credit were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	361.7	$	355.3	$	1,071.6	$	1,115.5
I&M	448.0		401.5		1,220.2		1,192.1
OPCo	750.9		670.7		2,011.2		1,949.0
PSO	390.6		411.5		971.9		1,025.9
SWEPCo	460.4		468.0		1,183.9		1,222.3

Public Service Co Of Oklahoma [Member]

Financing Activities

FINANCING ACTIVITIES

The disclosures in this note apply to all Registrants unless indicated otherwise.

Long-term Debt Outstanding (Applies to AEP)

The following table details long-term debt outstanding as of September 30, 2016 and December 31, 2015:

Type of Debt	September 30, 2016			December 31, 2015
	(in millions)
Senior Unsecured Notes	$	14,073.9	(a)	$	13,629.1
Pollution Control Bonds	1,724.5			1,784.8
Notes Payable	268.5			264.7
Securitization Bonds	1,737.6			2,024.0
Spent Nuclear Fuel Obligation (b)	266.1			265.6
Other Long-term Debt	1,768.9			1,604.5
Total Long-term Debt Outstanding	19,839.5		(a)	19,572.7
Long-term Debt Due Within One Year	2,519.6		(a)	1,831.8
Long-term Debt	$	17,319.9		$	17,740.9

(a) Amounts include debt related to the Lawrenceburg Plant that has been classified as Liabilities Held for Sale on the balance sheet. See “Gavin, Waterford, Darby and Lawrenceburg Plants (Generation & Marketing Segment)” section of Note 6 for additional information.

(b) Pursuant to the Nuclear Waste Policy Act of 1982, I&M, a nuclear licensee, has an obligation to the United States Department of Energy for spent nuclear fuel disposal.  The obligation includes a one-time fee for nuclear fuel consumed prior to April 7, 1983.  Trust fund assets related to this obligation were $309 million and $309 million as of September 30, 2016 and December 31, 2015, respectively, and are included in Spent Nuclear Fuel and Decommissioning Trusts on the balance sheets.

Long-term Debt Activity

Long-term debt and other securities issued, retired and principal payments made during the first nine months of 2016 are shown in the tables below:

Company	Type of Debt	Principal Amount (a)		Interest Rate	Due Date
Issuances:		(in millions)		(%)
APCo	Other Long-term Debt	$	125.0	Variable	2019
APCo	Pollution Control Bonds	125.3		Variable	2016
APCo	Pollution Control Bonds	65.4		1.70	2020
I&M	Notes Payable	87.9		Variable	2020
I&M	Senior Unsecured Notes	400.0		4.55	2046
PSO	Senior Unsecured Notes	50.0		3.05	2026
PSO	Senior Unsecured Notes	100.0		4.11	2046
SWEPCo	Other Long-term Debt	5.2		3.50	2023
SWEPCo	Senior Unsecured Notes	400.0		2.75	2026
Non-Registrant:
TCC	Other Long-term Debt	125.0		Variable	2019
TNC	Other Long-term Debt	75.0		Variable	2019
Transource Missouri	Other Long-term Debt	11.5		Variable	2018
Total Issuances		$	1,570.3

(a) Amounts indicated on the statements of cash flows are net of issuance costs and premium or discount and will not tie to the issuance amounts.

Company	Type of Debt	Principal Amount Paid		Interest Rate	Due Date
Retirements and Principal Payments:		(in millions)		(%)
APCo	Pollution Control Bonds	$	125.3	Variable	2016
APCo	Pollution Control Bonds	65.3		2.25	2016
APCo	Securitization Bonds	23.0		2.008	2024
I&M	Notes Payable	0.8		Variable	2016
I&M	Notes Payable	0.5		2.12	2016
I&M	Notes Payable	12.6		Variable	2017
I&M	Notes Payable	24.8		Variable	2019
I&M	Notes Payable	31.0		Variable	2019
I&M	Notes Payable	6.1		Variable	2020
I&M	Other Long-term Debt	1.0		6.00	2025
OPCo	Other Long-term Debt	0.1		1.149	2028
OPCo	Securitization Bonds	45.8		0.958	2018
OPCo	Senior Unsecured Notes	350.0		6.00	2016
PSO	Other Long-term Debt	0.3		3.00	2027
PSO	Senior Unsecured Notes	150.0		6.15	2016
SWEPCo	Notes Payable	3.3		4.58	2032
Non-Registrant:
AEGCo	Senior Unsecured Notes	7.3		6.33	2037
AEP Subsidiaries	Notes Payable	5.1		Variable	2017
AEP Subsidiaries	Notes Payable	0.1		5.75	2021
AGR	Pollution Control Bonds	60.0		Variable	2016
TCC	Other Long-term Debt	100.0		Variable	2016
TCC	Securitization Bonds	44.2		6.25	2016
TCC	Securitization Bonds	149.1		5.17	2018
TCC	Securitization Bonds	26.9		0.88	2017
TNC	Other Long-term Debt	75.0		Variable	2016
Total Retirements and Principal Payments		$	1,307.6

In October 2016, I&M retired $16 million of Notes Payable related to DCC Fuel.

As of September 30, 2016, trustees held, on behalf of AEP, $614 million of their reacquired Pollution Control Bonds. Of this total, $40 million and $345 million related to I&M and OPCo, respectively.

Dividend Restrictions

Parent Restrictions (Applies to AEP)

The holders of AEP’s common stock are entitled to receive the dividends declared by the Board of Directors provided funds are legally available for such dividends. Parent’s income primarily derives from common stock equity in the earnings of its utility subsidiaries.

Pursuant to the leverage restrictions in credit agreements, AEP must maintain a percentage of debt to total capitalization at a level that does not exceed 67.5%. The payment of cash dividends indirectly results in an increase in the percentage of debt to total capitalization of the company distributing the dividend. The method for calculating outstanding debt and capitalization is contractually defined in the credit agreements. As of September 30, 2016, none of AEP’s retained earnings were restricted for the purpose of the payment of dividends.

Utility Subsidiaries’ Restrictions

AEP utility subsidiaries pay dividends to Parent provided funds are legally available. Various financing arrangements and regulatory requirements may impose certain restrictions on the ability of the subsidiaries to transfer funds to Parent in the form of dividends.

Certain AEP subsidiaries have credit agreements that contain a covenant that limits their debt to capitalization ratio to 67.5%.

The Federal Power Act prohibits the utility subsidiaries from participating “in the making or paying of any dividends of such public utility from any funds properly included in capital account.” Additionally, the Federal Power Act creates a reserve on earnings attributable to hydroelectric generation plants. Because of their ownership of such plants, this reserve applies to AGR, APCo and I&M. As of September 30, 2016, these restrictions did not limit the ability of the subsidiaries to pay dividends out of retained earnings.

Corporate Borrowing Program - AEP System (Applies to Registrant Subsidiaries)

The AEP System uses a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries.  The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries, and a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries.  The AEP System Utility Money Pool operates in accordance with the terms and conditions of the AEP System Utility Money Pool agreement filed with the FERC.  The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates and Advances from Affiliates, respectively, on each of the Registrant Subsidiaries’ balance sheets.  The Utility Money Pool participants’ money pool activity and their corresponding authorized borrowing limits for the nine months ended September 30, 2016 are described in the following table:

	Maximum				Average				Net Loans to
	Borrowings		Maximum		Borrowings		Average		(Borrowings from)			Authorized
	from the		Loans to the		from the		Loans to the		the Utility Money			Short-term
	Utility		Utility		Utility		Utility		Pool as of			Borrowing
Company	Money Pool		Money Pool		Money Pool		Money Pool		September 30, 2016			Limit
	(in millions)
APCo	$	286.9	$	25.7	$	165.5	$	24.9	$	(59.7	)	$	600.0
I&M	369.1		97.6		118.9		21.8		(13.9		)	500.0
OPCo	227.9		379.2		137.8		251.1		0.2			400.0
PSO	9.6		205.4		5.1		47.0		51.1			300.0
SWEPCo	249.4		308.2		171.8		302.8		297.4			350.0

The activity in the above table does not include short-term lending activity of SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC, which is a participant in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates on SWEPCo’s balance sheets. For the nine months ended September 30, 2016, Mutual Energy SWEPCo, LLC had the following activity in the Nonutility Money Pool:

Maximum		Average		Loans
Loans		Loans		to the Nonutility
to the Nonutility		to the Nonutility		Money Pool as of
Money Pool		Money Pool		September 30, 2016
(in millions)
$	2.0	$	2.0	$	2.0

The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool were as follows:

	Nine Months Ended September 30,
	2016		2015
Maximum Interest Rate	0.91	%	0.59	%
Minimum Interest Rate	0.69	%	0.39	%

The average interest rates for funds borrowed from and loaned to the Utility Money Pool for the nine months ended September 30, 2016 and 2015 are summarized for all Registrant Subsidiaries in the following table:

	Average Interest Rate				Average Interest Rate
	for Funds Borrowed				for Funds Loaned
	from the Utility Money Pool for				to the Utility Money Pool for
	Nine Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
APCo	0.78	%	0.46	%	0.79	%	0.46	%
I&M	0.73	%	0.47	%	0.78	%	0.46	%
OPCo	0.85	%	—	%	0.74	%	0.47	%
PSO	0.76	%	0.49	%	0.81	%	0.46	%
SWEPCo	0.79	%	0.46	%	0.91	%	0.48	%

Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool for the nine months ended September 30, 2016 are summarized for Mutual Energy SWEPCo, LLC in the following table:

Maximum		Minimum		Average
Interest Rate		Interest Rate		Interest Rate
for Funds		for Funds		for Funds
Loaned to		Loaned to		Loaned to
the Nonutility		the Nonutility		the Nonutility
Money Pool		Money Pool		Money Pool
0.91	%	0.69	%	0.79	%

Short-term Debt (Applies to AEP)

Outstanding short-term debt was as follows:

	September 30, 2016				December 31, 2015
Type of Debt	Outstanding Amount		Interest Rate (a)		Outstanding Amount		Interest Rate (a)
	(in millions)				(in millions)
Securitized Debt for Receivables (b)	$	750.0	0.65	%	$	675.0	0.30	%
Commercial Paper	728.3		0.90	%	125.0		0.81	%
Total Short-term Debt	$	1,478.3			$	800.0

(a) Weighted average rate.

(b) Amount of securitized debt for receivables as accounted for under the “Transfers and Servicing” accounting guidance.

Credit Facilities

For a discussion of credit facilities, see “Letters of Credit” section of Note 5.

Sale of Receivables – AEP Credit (Applies to AEP)

AEP Credit has a receivables securitization agreement with bank conduits.  Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries.  These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections.

AEP Credit’s receivables securitization agreement provides a commitment of $750 million from bank conduits to purchase receivables and expires in June 2018.

Accounts receivable information for AEP Credit is as follows:

	Three Months Ended   September 30,						Nine Months Ended   September 30,
	2016			2015			2016			2015
	(dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable	0.73		%	0.30		%	0.65		%	0.28		%
Net Uncollectible Accounts Receivable Written Off	$	7.7		$	13.5		$	17.5		$	27.5

	September 30, 2016		December 31, 2015
	(in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts	$	1,037.7	$	924.8
Total Principal Outstanding	750.0		675.0
Delinquent Securitized Accounts Receivable	47.7		48.3
Bad Debt Reserves Related to Securitization of Accounts Receivable	27.8		17.5
Unbilled Receivables Related to Securitization of Accounts Receivable	297.1		357.8

AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due.

Sale of Receivables – AEP Credit (Applies to Registrant Subsidiaries)

Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables.  APCo does not have regulatory authority to sell its West Virginia accounts receivable.  The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income.  The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder.

The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement for each Registrant Subsidiary as of September 30, 2016 and December 31, 2015 was as follows:

Company	September 30, 2016		December 31, 2015
	(in millions)
APCo	$	131.9	$	135.4
I&M	152.5		134.8
OPCo	407.1		351.4
PSO	146.1		116.1
SWEPCo	170.0		151.8

The fees paid by the Registrant Subsidiaries to AEP Credit for customer accounts receivable sold were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	1.6	$	2.0	$	5.4	$	6.0
I&M	2.0		2.2		5.6		6.6
OPCo	8.1		8.5		23.4		23.2
PSO	1.8		1.7		4.7		4.5
SWEPCo	2.1		2.0		5.3		5.3

The Registrant Subsidiaries’ proceeds on the sale of receivables to AEP Credit were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	361.7	$	355.3	$	1,071.6	$	1,115.5
I&M	448.0		401.5		1,220.2		1,192.1
OPCo	750.9		670.7		2,011.2		1,949.0
PSO	390.6		411.5		971.9		1,025.9
SWEPCo	460.4		468.0		1,183.9		1,222.3

Southwestern Electric Power Co [Member]

Financing Activities

FINANCING ACTIVITIES

The disclosures in this note apply to all Registrants unless indicated otherwise.

Long-term Debt Outstanding (Applies to AEP)

The following table details long-term debt outstanding as of September 30, 2016 and December 31, 2015:

Type of Debt	September 30, 2016			December 31, 2015
	(in millions)
Senior Unsecured Notes	$	14,073.9	(a)	$	13,629.1
Pollution Control Bonds	1,724.5			1,784.8
Notes Payable	268.5			264.7
Securitization Bonds	1,737.6			2,024.0
Spent Nuclear Fuel Obligation (b)	266.1			265.6
Other Long-term Debt	1,768.9			1,604.5
Total Long-term Debt Outstanding	19,839.5		(a)	19,572.7
Long-term Debt Due Within One Year	2,519.6		(a)	1,831.8
Long-term Debt	$	17,319.9		$	17,740.9

(a) Amounts include debt related to the Lawrenceburg Plant that has been classified as Liabilities Held for Sale on the balance sheet. See “Gavin, Waterford, Darby and Lawrenceburg Plants (Generation & Marketing Segment)” section of Note 6 for additional information.

(b) Pursuant to the Nuclear Waste Policy Act of 1982, I&M, a nuclear licensee, has an obligation to the United States Department of Energy for spent nuclear fuel disposal.  The obligation includes a one-time fee for nuclear fuel consumed prior to April 7, 1983.  Trust fund assets related to this obligation were $309 million and $309 million as of September 30, 2016 and December 31, 2015, respectively, and are included in Spent Nuclear Fuel and Decommissioning Trusts on the balance sheets.

Long-term Debt Activity

Long-term debt and other securities issued, retired and principal payments made during the first nine months of 2016 are shown in the tables below:

Company	Type of Debt	Principal Amount (a)		Interest Rate	Due Date
Issuances:		(in millions)		(%)
APCo	Other Long-term Debt	$	125.0	Variable	2019
APCo	Pollution Control Bonds	125.3		Variable	2016
APCo	Pollution Control Bonds	65.4		1.70	2020
I&M	Notes Payable	87.9		Variable	2020
I&M	Senior Unsecured Notes	400.0		4.55	2046
PSO	Senior Unsecured Notes	50.0		3.05	2026
PSO	Senior Unsecured Notes	100.0		4.11	2046
SWEPCo	Other Long-term Debt	5.2		3.50	2023
SWEPCo	Senior Unsecured Notes	400.0		2.75	2026
Non-Registrant:
TCC	Other Long-term Debt	125.0		Variable	2019
TNC	Other Long-term Debt	75.0		Variable	2019
Transource Missouri	Other Long-term Debt	11.5		Variable	2018
Total Issuances		$	1,570.3

(a) Amounts indicated on the statements of cash flows are net of issuance costs and premium or discount and will not tie to the issuance amounts.

Company	Type of Debt	Principal Amount Paid		Interest Rate	Due Date
Retirements and Principal Payments:		(in millions)		(%)
APCo	Pollution Control Bonds	$	125.3	Variable	2016
APCo	Pollution Control Bonds	65.3		2.25	2016
APCo	Securitization Bonds	23.0		2.008	2024
I&M	Notes Payable	0.8		Variable	2016
I&M	Notes Payable	0.5		2.12	2016
I&M	Notes Payable	12.6		Variable	2017
I&M	Notes Payable	24.8		Variable	2019
I&M	Notes Payable	31.0		Variable	2019
I&M	Notes Payable	6.1		Variable	2020
I&M	Other Long-term Debt	1.0		6.00	2025
OPCo	Other Long-term Debt	0.1		1.149	2028
OPCo	Securitization Bonds	45.8		0.958	2018
OPCo	Senior Unsecured Notes	350.0		6.00	2016
PSO	Other Long-term Debt	0.3		3.00	2027
PSO	Senior Unsecured Notes	150.0		6.15	2016
SWEPCo	Notes Payable	3.3		4.58	2032
Non-Registrant:
AEGCo	Senior Unsecured Notes	7.3		6.33	2037
AEP Subsidiaries	Notes Payable	5.1		Variable	2017
AEP Subsidiaries	Notes Payable	0.1		5.75	2021
AGR	Pollution Control Bonds	60.0		Variable	2016
TCC	Other Long-term Debt	100.0		Variable	2016
TCC	Securitization Bonds	44.2		6.25	2016
TCC	Securitization Bonds	149.1		5.17	2018
TCC	Securitization Bonds	26.9		0.88	2017
TNC	Other Long-term Debt	75.0		Variable	2016
Total Retirements and Principal Payments		$	1,307.6

In October 2016, I&M retired $16 million of Notes Payable related to DCC Fuel.

As of September 30, 2016, trustees held, on behalf of AEP, $614 million of their reacquired Pollution Control Bonds. Of this total, $40 million and $345 million related to I&M and OPCo, respectively.

Dividend Restrictions

Parent Restrictions (Applies to AEP)

The holders of AEP’s common stock are entitled to receive the dividends declared by the Board of Directors provided funds are legally available for such dividends. Parent’s income primarily derives from common stock equity in the earnings of its utility subsidiaries.

Pursuant to the leverage restrictions in credit agreements, AEP must maintain a percentage of debt to total capitalization at a level that does not exceed 67.5%. The payment of cash dividends indirectly results in an increase in the percentage of debt to total capitalization of the company distributing the dividend. The method for calculating outstanding debt and capitalization is contractually defined in the credit agreements. As of September 30, 2016, none of AEP’s retained earnings were restricted for the purpose of the payment of dividends.

Utility Subsidiaries’ Restrictions

AEP utility subsidiaries pay dividends to Parent provided funds are legally available. Various financing arrangements and regulatory requirements may impose certain restrictions on the ability of the subsidiaries to transfer funds to Parent in the form of dividends.

Certain AEP subsidiaries have credit agreements that contain a covenant that limits their debt to capitalization ratio to 67.5%.

The Federal Power Act prohibits the utility subsidiaries from participating “in the making or paying of any dividends of such public utility from any funds properly included in capital account.” Additionally, the Federal Power Act creates a reserve on earnings attributable to hydroelectric generation plants. Because of their ownership of such plants, this reserve applies to AGR, APCo and I&M. As of September 30, 2016, these restrictions did not limit the ability of the subsidiaries to pay dividends out of retained earnings.

Corporate Borrowing Program - AEP System (Applies to Registrant Subsidiaries)

The AEP System uses a corporate borrowing program to meet the short-term borrowing needs of AEP’s subsidiaries.  The corporate borrowing program includes a Utility Money Pool, which funds AEP’s utility subsidiaries, and a Nonutility Money Pool, which funds certain AEP nonutility subsidiaries.  The AEP System Utility Money Pool operates in accordance with the terms and conditions of the AEP System Utility Money Pool agreement filed with the FERC.  The amounts of outstanding loans to (borrowings from) the Utility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates and Advances from Affiliates, respectively, on each of the Registrant Subsidiaries’ balance sheets.  The Utility Money Pool participants’ money pool activity and their corresponding authorized borrowing limits for the nine months ended September 30, 2016 are described in the following table:

	Maximum				Average				Net Loans to
	Borrowings		Maximum		Borrowings		Average		(Borrowings from)			Authorized
	from the		Loans to the		from the		Loans to the		the Utility Money			Short-term
	Utility		Utility		Utility		Utility		Pool as of			Borrowing
Company	Money Pool		Money Pool		Money Pool		Money Pool		September 30, 2016			Limit
	(in millions)
APCo	$	286.9	$	25.7	$	165.5	$	24.9	$	(59.7	)	$	600.0
I&M	369.1		97.6		118.9		21.8		(13.9		)	500.0
OPCo	227.9		379.2		137.8		251.1		0.2			400.0
PSO	9.6		205.4		5.1		47.0		51.1			300.0
SWEPCo	249.4		308.2		171.8		302.8		297.4			350.0

The activity in the above table does not include short-term lending activity of SWEPCo’s wholly-owned subsidiary, Mutual Energy SWEPCo, LLC, which is a participant in the Nonutility Money Pool. The amounts of outstanding loans to the Nonutility Money Pool as of September 30, 2016 and December 31, 2015 are included in Advances to Affiliates on SWEPCo’s balance sheets. For the nine months ended September 30, 2016, Mutual Energy SWEPCo, LLC had the following activity in the Nonutility Money Pool:

Maximum		Average		Loans
Loans		Loans		to the Nonutility
to the Nonutility		to the Nonutility		Money Pool as of
Money Pool		Money Pool		September 30, 2016
(in millions)
$	2.0	$	2.0	$	2.0

The maximum and minimum interest rates for funds either borrowed from or loaned to the Utility Money Pool were as follows:

	Nine Months Ended September 30,
	2016		2015
Maximum Interest Rate	0.91	%	0.59	%
Minimum Interest Rate	0.69	%	0.39	%

The average interest rates for funds borrowed from and loaned to the Utility Money Pool for the nine months ended September 30, 2016 and 2015 are summarized for all Registrant Subsidiaries in the following table:

	Average Interest Rate				Average Interest Rate
	for Funds Borrowed				for Funds Loaned
	from the Utility Money Pool for				to the Utility Money Pool for
	Nine Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
APCo	0.78	%	0.46	%	0.79	%	0.46	%
I&M	0.73	%	0.47	%	0.78	%	0.46	%
OPCo	0.85	%	—	%	0.74	%	0.47	%
PSO	0.76	%	0.49	%	0.81	%	0.46	%
SWEPCo	0.79	%	0.46	%	0.91	%	0.48	%

Maximum, minimum and average interest rates for funds loaned to the Nonutility Money Pool for the nine months ended September 30, 2016 are summarized for Mutual Energy SWEPCo, LLC in the following table:

Maximum		Minimum		Average
Interest Rate		Interest Rate		Interest Rate
for Funds		for Funds		for Funds
Loaned to		Loaned to		Loaned to
the Nonutility		the Nonutility		the Nonutility
Money Pool		Money Pool		Money Pool
0.91	%	0.69	%	0.79	%

Short-term Debt (Applies to AEP)

Outstanding short-term debt was as follows:

	September 30, 2016				December 31, 2015
Type of Debt	Outstanding Amount		Interest Rate (a)		Outstanding Amount		Interest Rate (a)
	(in millions)				(in millions)
Securitized Debt for Receivables (b)	$	750.0	0.65	%	$	675.0	0.30	%
Commercial Paper	728.3		0.90	%	125.0		0.81	%
Total Short-term Debt	$	1,478.3			$	800.0

(a) Weighted average rate.

(b) Amount of securitized debt for receivables as accounted for under the “Transfers and Servicing” accounting guidance.

Credit Facilities

For a discussion of credit facilities, see “Letters of Credit” section of Note 5.

Sale of Receivables – AEP Credit (Applies to AEP)

AEP Credit has a receivables securitization agreement with bank conduits.  Under the securitization agreement, AEP Credit receives financing from the bank conduits for the interest in the receivables AEP Credit acquires from affiliated utility subsidiaries.  These securitized transactions allow AEP Credit to repay its outstanding debt obligations, continue to purchase the operating companies’ receivables and accelerate AEP Credit’s cash collections.

AEP Credit’s receivables securitization agreement provides a commitment of $750 million from bank conduits to purchase receivables and expires in June 2018.

Accounts receivable information for AEP Credit is as follows:

	Three Months Ended   September 30,						Nine Months Ended   September 30,
	2016			2015			2016			2015
	(dollars in millions)
Effective Interest Rates on Securitization of Accounts Receivable	0.73		%	0.30		%	0.65		%	0.28		%
Net Uncollectible Accounts Receivable Written Off	$	7.7		$	13.5		$	17.5		$	27.5

	September 30, 2016		December 31, 2015
	(in millions)
Accounts Receivable Retained Interest and Pledged as Collateral Less Uncollectible Accounts	$	1,037.7	$	924.8
Total Principal Outstanding	750.0		675.0
Delinquent Securitized Accounts Receivable	47.7		48.3
Bad Debt Reserves Related to Securitization of Accounts Receivable	27.8		17.5
Unbilled Receivables Related to Securitization of Accounts Receivable	297.1		357.8

AEP Credit’s delinquent customer accounts receivable represent accounts greater than 30 days past due.

Sale of Receivables – AEP Credit (Applies to Registrant Subsidiaries)

Under this sale of receivables arrangement, the Registrant Subsidiaries sell, without recourse, certain of their customer accounts receivable and accrued unbilled revenue balances to AEP Credit and are charged a fee based on AEP Credit’s financing costs, administrative costs and uncollectible accounts experience for each Registrant Subsidiary’s receivables.  APCo does not have regulatory authority to sell its West Virginia accounts receivable.  The costs of customer accounts receivable sold are reported in Other Operation expense on the Registrant Subsidiaries’ statements of income.  The Registrant Subsidiaries manage and service their customer accounts receivable, which are sold to AEP Credit. AEP Credit securitizes the eligible receivables for the operating companies and retains the remainder.

The amount of accounts receivable and accrued unbilled revenues under the sale of receivables agreement for each Registrant Subsidiary as of September 30, 2016 and December 31, 2015 was as follows:

Company	September 30, 2016		December 31, 2015
	(in millions)
APCo	$	131.9	$	135.4
I&M	152.5		134.8
OPCo	407.1		351.4
PSO	146.1		116.1
SWEPCo	170.0		151.8

The fees paid by the Registrant Subsidiaries to AEP Credit for customer accounts receivable sold were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	1.6	$	2.0	$	5.4	$	6.0
I&M	2.0		2.2		5.6		6.6
OPCo	8.1		8.5		23.4		23.2
PSO	1.8		1.7		4.7		4.5
SWEPCo	2.1		2.0		5.3		5.3

The Registrant Subsidiaries’ proceeds on the sale of receivables to AEP Credit were:

	Three Months Ended September 30,				Nine Months Ended September 30,
Company	2016		2015		2016		2015
	(in millions)
APCo	$	361.7	$	355.3	$	1,071.6	$	1,115.5
I&M	448.0		401.5		1,220.2		1,192.1
OPCo	750.9		670.7		2,011.2		1,949.0
PSO	390.6		411.5		971.9		1,025.9
SWEPCo	460.4		468.0		1,183.9		1,222.3