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Stock-Based Compensation (Tables)
12 Months Ended
Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]  
Performance Units and Reinvested Dividends on Outstanding Performance Units
 
 
Years Ended December 31,
Performance Units
 
2018
 
2017
 
2016
Awarded Units (in thousands) (a)
 
581.4

 
590.7

 
597.4

Weighted Average Unit Fair Value at Grant Date
 
$
67.21

 
$
69.78

 
$
62.77

Vesting Period (in years)
 
3

 
3

 
3

Performance Units and AEP Career Shares
(Reinvested Dividends Portion)
 
Years Ended December 31,
 
2018
 
2017
 
2016
Awarded Units (in thousands) (b)
 
80.2

 
74.6

 
89.2

Weighted Average Fair Value at Grant Date
 
$
70.58

 
$
72.35

 
$
63.83

Vesting Period (in years)
 
(c)

 
(c)

 
(c)



(a)
Awarded units in 2018 and 2017 were mezzanine equity awards and awarded units in 2016 were liability awards.
(b)
Awarded dividends in 2018 and 2017 were a mix of equity awards and liability awards, and all awarded dividends in 2016 were liability awards.
(c)
The vesting period for the reinvested dividends on performance units is equal to the remaining life of the related performance units.  Dividends on AEP career shares vest immediately when the dividend is awarded but are not settled in AEP common stock until after the participant’s AEP employment ends.

Summary of Performance Scores and Performance Units Earned
 
 
Years Ended December 31,
Performance Units
 
2018
 
2017
 
2016
Certified Performance Score
 
136.7
%
 
164.8
%
 
163.9
%
Performance Units Earned
 
820,780

 
956,055

 
1,111,966

Performance Units Mandatorily Deferred as AEP Career Shares
 
11,248

 
20,213

 
9,963

Performance Units Voluntarily Deferred into the Incentive Compensation Deferral Program
 
56,826

 
47,177

 
51,684

Performance Units to be Settled in Cash
 
752,706

 
888,665

 
1,050,319

Summary of Cash Payouts for Performance Units and Career Shares
 
 
Years Ended December 31,
Performance Units and AEP Career Shares
 
2018
 
2017
 
2016
 
 
(in millions)
Cash Settlements for Performance Units
 
$
66.9

 
$
64.9

 
$
62.7

Cash Settlements for Career Share Distributions
 

 

 
9.1

AEP Common Stock Settlements for Career Share Distributions
 
5.1

 
0.4

 

Status of Nonvested Performance Units
Nonvested Performance Units
 
Shares/Units
 
Weighted
Average
Grant Date
Fair Value
 
 
(in thousands)
 
 
Nonvested as of January 1, 2018
 
587.5

 
$
64.48

Granted
 
617.3

 
67.43

Vested
 

 

Forfeited
 
(33.5
)
 
65.50

Nonvested as of December 31, 2018
 
1,171.3

 
66.01

Monte Carlo Valuation Assumptions
 
 
Years Ended December 31,
Monte Carlo Valuation
 
2018
 
2017
Valuation Period (in years) (a)
 
2.87

 
2.86

Expected Volatility Minimum
 
14.77
%
 
15.65
%
Expected Volatility Maximum
 
26.72
%
 
27.19
%
Expected Volatility Average
 
17.90
%
 
19.07
%
Dividend Rate (b)
 
%
 
%
Risk Free Rate
 
2.34
%
 
1.44
%

(a)
Period from award date to vesting date.
(b)
Equivalent to reinvesting dividends.
Summary of Units Awarded and Fair Value of Restricted Stock Units
 
 
Years Ended December 31,
Restricted Stock Units
 
2018
 
2017
 
2016
Awarded Units (in thousands)
 
260.0

 
255.8

 
242.0

Weighted Average Grant Date Fair Value
 
$
67.96

 
$
65.26

 
$
62.88

Total Fair Value and Total Intrinsic Value of Restricted Shares and Restricted Stock Units Vested
 
 
Years Ended December 31,
Restricted Stock Units
 
2018
 
2017
 
2016
 
 
(in millions)
Fair Value of Restricted Stock Units Vested
 
$
16.6

 
$
16.1

 
$
16.4

Intrinsic Value of Restricted Stock Units Vested (a)
 
19.2

 
20.0

 
21.0



(a)
Intrinsic value is calculated as market price at exercise date.
Status of Nonvested Restricted Shares and Restricted Stock Units
Nonvested Restricted Stock Units
 
Shares/Units
 
Weighted
Average
Grant Date
Fair Value
 
 
(in thousands)
 
 
Nonvested as of January 1, 2018
 
529.6

 
$
62.13

Granted
 
260.0

 
67.96

Vested
 
(277.5
)
 
59.77

Forfeited
 
(23.0
)
 
64.84

Nonvested as of December 31, 2018
 
489.1

 
66.01

Stock Unit Accumulation Plan for Non-employee Directors
 
 
Years Ended December 31,
Stock Unit Accumulation Plan for Non-Employee Directors
 
2018
 
2017
 
2016
Awarded Units (in thousands)
 
11.4

 
14.8

 
19.1

Weighted Average Grant Date Fair Value
 
$
70.41

 
$
70.79

 
$
64.96

Compensation Cost and Actual Tax Benefit Realized for Tax Deductions from Compensation Cost for Share-based Payment Arrangements
 
 
Years Ended December 31,
Share-based Compensation Plans
 
2018
 
2017
 
2016
 
 
(in millions)
Compensation Cost for Share-based Payment Arrangements (a)
 
$
53.2

 
$
79.5

 
$
66.5

Actual Tax Benefit (b)
 
7.7

 
18.9

 
23.3

Total Compensation Cost Capitalized
 
19.7

 
26.4

 
20.8



(a)
Compensation cost for share-based payment arrangements is included in Other Operation and Maintenance expenses on the statements of income.
(b)
In December 2017, Tax Reform modified Section 162(m) of the Internal Revenue Code.  Beginning after 2017, AEP can no longer deduct certain compensation expense in excess of $1 million for certain named executive officers. This will reduce the tax benefit going forward.