Derivatives and Hedging (Tables)

6 Months Ended

Jun. 30, 2012

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
		Volume
		June 30,		December 31,		Unit of
		2012		2011		Measure
Primary Risk Exposure		(in millions)
Commodity:
	Power		704		609	MWHs
	Coal		16		21	Tons
	Natural Gas		115		100	MMBtus
	Heating Oil and Gasoline		4		6	Gallons
	Interest Rate	$	296	$	226	USD
Interest Rate and Foreign Currency		$	803	$	907	USD

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
June 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		$	996	$	37	$	1	$	(815)	$	219
Long-term Risk Management Assets			733		15		1		(310)		439
Total Assets			1,729		52		2		(1,125)		658
Current Risk Management Liabilities			951		53		33		(872)		165
Long-term Risk Management Liabilities			586		21		2		(350)		259
Total Liabilities			1,537		74		35		(1,222)		424
Total MTM Derivative Contract Net Assets
	(Liabilities)	$	192	$	(22)	$	(33)	$	97	$	234
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 Months Ended June 30, 2012 and 2011
Location of Gain (Loss)	2012		2011
	(in millions)
Utility Operations Revenues	$	4	$	18
Other Revenues		5		13
Regulatory Assets (a)		(17)		(5)
Regulatory Liabilities (a)		13		5
Total Gain (Loss) on Risk Management Contracts	$	5	$	31
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2012 and 2011
Location of Gain (Loss)	2012		2011
	(in millions)
Utility Operations Revenues	$	14	$	38
Other Revenues		8		15
Regulatory Assets (a)		(38)		(1)
Regulatory Liabilities (a)		27		11
Total Gain (Loss) on Risk Management Contracts	$	11	$	63

(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 June 30, 2012
					Interest Rate
					and Foreign
			Commodity		Currency		Total
			(in millions)
Balance in AOCI as of March 31, 2012			$	(16)	$	(18)	$	(34)
Changes in Fair Value Recognized in AOCI				(3)		(13)		(16)
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		-		-		-
		Other Revenues		(2)		-		(2)
		Purchased Electricity for Resale		6		-		6
		Interest Expense		-		1		1
		Regulatory Assets (a)		1		-		1
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of June 30, 2012			$	(14)	$	(30)	$	(44)
Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended June 30, 2011
					Interest Rate
					and Foreign
			Commodity		Currency		Total
			(in millions)
Balance in AOCI as of March 31, 2011			$	8	$	4	$	12
Changes in Fair Value Recognized in AOCI				3		-		3
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		2		-		2
		Other Revenues		(1)		-		(1)
		Purchased Electricity for Resale		(1)		-		(1)
		Interest Expense		-		1		1
		Regulatory Assets (a)		1		-		1
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of June 30, 2011			$	12	$	5	$	17

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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				(23)		(12)		(35)
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		-		-		-
		Other Revenues		(3)		-		(3)
		Purchased Electricity for Resale		13		-		13
		Interest Expense		-		2		2
		Regulatory Assets (a)		2		-		2
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of June 30, 2012			$	(14)	$	(30)	$	(44)
Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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				5		(1)		4
Amount of (Gain) or Loss Reclassified from AOCI
	to Statement of Income/within Balance Sheet:
		Utility Operations Revenues		2		-		2
		Other Revenues		(2)		-		(2)
		Purchased Electricity for Resale		(1)		-		(1)
		Interest Expense		-		2		2
		Regulatory Assets (a)		1		-		1
		Regulatory Liabilities (a)		-		-		-
Balance in AOCI as of June 30, 2011			$	12	$	5	$	17

(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 Balance Sheet

Impact of Cash Flow Hedges on the Condensed Balance Sheet
June 30, 2012
				Interest Rate
				and Foreign
		Commodity		Currency		Total
		(in millions)
Hedging Assets (a)		$	38	$	-	$	38
Hedging Liabilities (a)			60		35		95
AOCI Gain (Loss) Net of Tax			(14)		(30)		(44)
Portion Expected to be Reclassified to Net
	Income During the Next Twelve Months		(10)		(3)		(13)
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

		June 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		35		39
Amount Attributable to RTO and ISO Activities			33		38

Liabilities Subject to Cross Default Provisions

	June 30,		December 31,
	2012		2011
	(in millions)
Liabilities for Contracts with Cross Default Provisions Prior to Contractual
Netting Arrangements	$	658	$	515
Amount of Cash Collateral Posted		10		56
Additional Settlement Liability if Cross Default Provision is Triggered		375		291

Appalachian Power Co [Member]

Notional Volume of Derivative Instruments

Notional Volume of Derivative Instruments
June 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		179,238		126,489		264,309		35		44
	Coal		Tons		2,745		1,842		6,337		1,915		2,857
	Natural Gas		MMBtus		12,501		8,793		18,435		78		98
	Heating Oil and
		Gasoline	Gallons		667		348		823		372		357
	Interest Rate		USD	$	36,230	$	25,484	$	53,426	$	-	$	-
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

	June 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	$	2,664	$	19,667	$	4,291	$	28,964
I&M		1,874		13,793		2,752		18,547
OPCo		3,929		28,948		5,810		39,183
PSO		30		136		53		130
SWEPCo		37		133		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
June 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		$	252,825	$	979	$	-	$	(211,963)	$	41,841
Long-term Risk Management Assets			112,302		236		-		(67,862)		44,676
Total Assets			365,127		1,215		-		(279,825)		86,517
Current Risk Management Liabilities			243,424		3,363		-		(223,751)		23,036
Long-term Risk Management Liabilities			95,932		660		-		(73,954)		22,638
Total Liabilities			339,356		4,023		-		(297,705)		45,674
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	25,771	$	(2,808)	$	-	$	17,880	$	40,843
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 June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(599)	$	2,579	$	2,538	$	165	$	303
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(3,796)		(2,905)		(8,895)		(757)		(364)
Regulatory Liabilities (a)			4,711		392		7,178		(26)		(27)
Total Gain (Loss) on Risk Management
	Contracts	$	316	$	66	$	821	$	(618)	$	(88)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	883	$	3,702	$	11,564	$	539	$	403
Sales to AEP Affiliates			13		6		13		(1)		(1)
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(150)		(1,018)		(4,603)		644		404
Regulatory Liabilities (a)			4,142		(1,077)		-		461		692
Total Gain (Loss) on Risk Management
	Contracts	$	4,888	$	1,613	$	6,974	$	1,643	$	1,498

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(926)	$	5,392	$	11,031	$	160	$	252
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(7,277)		(6,015)		(12,026)		(5,958)		(7,092)
Regulatory Liabilities (a)			11,120		7,118		7,178		1		(5)
Total Gain (Loss) on Risk Management
	Contracts	$	2,917	$	6,495	$	6,183	$	(5,797)	$	(6,845)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	2,699	$	9,117	$	22,154	$	658	$	526
Sales to AEP Affiliates			33		23		45		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			223		115		(4,208)		276		2,046
Regulatory Liabilities (a)			10,896		(1,664)		(105)		853		1,032
Total Gain (Loss) on Risk Management
	Contracts	$	13,851	$	7,591	$	17,886	$	1,787	$	3,604
(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 June 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(2,117)	$	(1,508)	$	(3,149)	$	67	$	66
Changes in Fair Value Recognized in AOCI					(403)		(234)		(525)		(155)		(149)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	1,293	$	(11,320)	$	9,114	$	7,029	$	(17,365)
Changes in Fair Value Recognized in AOCI					-		(7,844)		-		-		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		149		(341)		(190)		560
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(824)	$	(12,828)	$	5,965	$	7,096	$	(17,299)
Changes in Fair Value Recognized in AOCI					(403)		(8,078)		(525)		(155)		(150)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		149		(341)		(190)		560
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended June 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	238	$	101	$	269	$	264	$	244
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		(26)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	217	$	(8,255)	$	10,473	$	7,787	$	(4,058)
Changes in Fair Value Recognized in AOCI					-		-		-		-		794
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		251		(341)		(189)		207
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	455	$	(8,154)	$	10,742	$	8,051	$	(3,814)
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		768
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		251		(341)		(189)		207
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					(2,248)		(1,628)		(3,402)		(16)		(17)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
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					-		(4,848)		-		-		(2,777)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			538		298		(682)		(379)		1,433
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
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					(2,248)		(6,476)		(3,402)		(16)		(2,794)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			538		298		(682)		(379)		1,433
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					123		53		143		180		168
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
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)		-		-		(476)		801
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			642		503		(682)		(332)		414
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
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					(250)		53		143		(296)		969
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			642		503		(682)		(332)		414
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
(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 Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
June 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	$	963	$	-	$	3,771	$	-	$	(1,820)	$	1,562
I&M		677		-		2,606		18,095		(1,246)		(19,015)
OPCo		1,420		-		5,500		-		(2,639)		8,774
PSO		-		-		141		-		(102)		6,839
SWEPCo		-		-		136		-		(97)		(16,806)

	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	$	(1,543)	$	(1,021)		23
I&M		(1,057)		(938)		23
OPCo		(2,236)		1,359		23
PSO		(89)		759		18
SWEPCo		(84)		(2,369)		18

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

	June 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	$	1,929	$	2,664	$	2,664
I&M		1,357		1,874		1,874
OPCo		2,845		3,928		3,928
PSO		-		1,002		269
SWEPCo		-		1,263		339

	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

	June 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	$	92,276	$	2,294	$	37,533
I&M		83,000		1,613		44,495
OPCo		136,073		3,383		55,347
PSO		150		-		44
SWEPCo		189		-		55
	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
June 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		179,238		126,489		264,309		35		44
	Coal		Tons		2,745		1,842		6,337		1,915		2,857
	Natural Gas		MMBtus		12,501		8,793		18,435		78		98
	Heating Oil and
		Gasoline	Gallons		667		348		823		372		357
	Interest Rate		USD	$	36,230	$	25,484	$	53,426	$	-	$	-
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

	June 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	$	2,664	$	19,667	$	4,291	$	28,964
I&M		1,874		13,793		2,752		18,547
OPCo		3,929		28,948		5,810		39,183
PSO		30		136		53		130
SWEPCo		37		133		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
June 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		$	186,932	$	689	$	-	$	(148,563)	$	39,058
Long-term Risk Management Assets			78,944		166		-		(47,702)		31,408
Total Assets			265,876		855		-		(196,265)		70,466
Current Risk Management Liabilities			170,637		2,326		18,095		(156,819)		34,239
Long-term Risk Management Liabilities			67,432		458		-		(51,982)		15,908
Total Liabilities			238,069		2,784		18,095		(208,801)		50,147
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	27,807	$	(1,929)	$	(18,095)	$	12,536	$	20,319
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 June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(599)	$	2,579	$	2,538	$	165	$	303
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(3,796)		(2,905)		(8,895)		(757)		(364)
Regulatory Liabilities (a)			4,711		392		7,178		(26)		(27)
Total Gain (Loss) on Risk Management
	Contracts	$	316	$	66	$	821	$	(618)	$	(88)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	883	$	3,702	$	11,564	$	539	$	403
Sales to AEP Affiliates			13		6		13		(1)		(1)
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(150)		(1,018)		(4,603)		644		404
Regulatory Liabilities (a)			4,142		(1,077)		-		461		692
Total Gain (Loss) on Risk Management
	Contracts	$	4,888	$	1,613	$	6,974	$	1,643	$	1,498

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(926)	$	5,392	$	11,031	$	160	$	252
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(7,277)		(6,015)		(12,026)		(5,958)		(7,092)
Regulatory Liabilities (a)			11,120		7,118		7,178		1		(5)
Total Gain (Loss) on Risk Management
	Contracts	$	2,917	$	6,495	$	6,183	$	(5,797)	$	(6,845)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	2,699	$	9,117	$	22,154	$	658	$	526
Sales to AEP Affiliates			33		23		45		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			223		115		(4,208)		276		2,046
Regulatory Liabilities (a)			10,896		(1,664)		(105)		853		1,032
Total Gain (Loss) on Risk Management
	Contracts	$	13,851	$	7,591	$	17,886	$	1,787	$	3,604
(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 June 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(2,117)	$	(1,508)	$	(3,149)	$	67	$	66
Changes in Fair Value Recognized in AOCI					(403)		(234)		(525)		(155)		(149)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	1,293	$	(11,320)	$	9,114	$	7,029	$	(17,365)
Changes in Fair Value Recognized in AOCI					-		(7,844)		-		-		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		149		(341)		(190)		560
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(824)	$	(12,828)	$	5,965	$	7,096	$	(17,299)
Changes in Fair Value Recognized in AOCI					(403)		(8,078)		(525)		(155)		(150)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		149		(341)		(190)		560
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended June 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	238	$	101	$	269	$	264	$	244
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		(26)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	217	$	(8,255)	$	10,473	$	7,787	$	(4,058)
Changes in Fair Value Recognized in AOCI					-		-		-		-		794
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		251		(341)		(189)		207
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	455	$	(8,154)	$	10,742	$	8,051	$	(3,814)
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		768
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		251		(341)		(189)		207
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					(2,248)		(1,628)		(3,402)		(16)		(17)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
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					-		(4,848)		-		-		(2,777)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			538		298		(682)		(379)		1,433
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
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					(2,248)		(6,476)		(3,402)		(16)		(2,794)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			538		298		(682)		(379)		1,433
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					123		53		143		180		168
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
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)		-		-		(476)		801
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			642		503		(682)		(332)		414
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
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					(250)		53		143		(296)		969
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			642		503		(682)		(332)		414
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
(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 Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
June 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	$	963	$	-	$	3,771	$	-	$	(1,820)	$	1,562
I&M		677		-		2,606		18,095		(1,246)		(19,015)
OPCo		1,420		-		5,500		-		(2,639)		8,774
PSO		-		-		141		-		(102)		6,839
SWEPCo		-		-		136		-		(97)		(16,806)

	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	$	(1,543)	$	(1,021)		23
I&M		(1,057)		(938)		23
OPCo		(2,236)		1,359		23
PSO		(89)		759		18
SWEPCo		(84)		(2,369)		18

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

	June 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	$	1,929	$	2,664	$	2,664
I&M		1,357		1,874		1,874
OPCo		2,845		3,928		3,928
PSO		-		1,002		269
SWEPCo		-		1,263		339

	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

	June 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	$	92,276	$	2,294	$	37,533
I&M		83,000		1,613		44,495
OPCo		136,073		3,383		55,347
PSO		150		-		44
SWEPCo		189		-		55
	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
June 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		179,238		126,489		264,309		35		44
	Coal		Tons		2,745		1,842		6,337		1,915		2,857
	Natural Gas		MMBtus		12,501		8,793		18,435		78		98
	Heating Oil and
		Gasoline	Gallons		667		348		823		372		357
	Interest Rate		USD	$	36,230	$	25,484	$	53,426	$	-	$	-
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

	June 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	$	2,664	$	19,667	$	4,291	$	28,964
I&M		1,874		13,793		2,752		18,547
OPCo		3,929		28,948		5,810		39,183
PSO		30		136		53		130
SWEPCo		37		133		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
June 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		$	387,633	$	1,445	$	-	$	(326,116)	$	62,962
Long-term Risk Management Assets			166,799		347		-		(100,856)		66,290
Total Assets			554,432		1,792		-		(426,972)		129,252
Current Risk Management Liabilities			373,685		4,906		-		(343,450)		35,141
Long-term Risk Management Liabilities			142,621		966		-		(109,834)		33,753
Total Liabilities			516,306		5,872		-		(453,284)		68,894
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	38,126	$	(4,080)	$	-	$	26,312	$	60,358
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 June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(599)	$	2,579	$	2,538	$	165	$	303
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(3,796)		(2,905)		(8,895)		(757)		(364)
Regulatory Liabilities (a)			4,711		392		7,178		(26)		(27)
Total Gain (Loss) on Risk Management
	Contracts	$	316	$	66	$	821	$	(618)	$	(88)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	883	$	3,702	$	11,564	$	539	$	403
Sales to AEP Affiliates			13		6		13		(1)		(1)
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(150)		(1,018)		(4,603)		644		404
Regulatory Liabilities (a)			4,142		(1,077)		-		461		692
Total Gain (Loss) on Risk Management
	Contracts	$	4,888	$	1,613	$	6,974	$	1,643	$	1,498

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(926)	$	5,392	$	11,031	$	160	$	252
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(7,277)		(6,015)		(12,026)		(5,958)		(7,092)
Regulatory Liabilities (a)			11,120		7,118		7,178		1		(5)
Total Gain (Loss) on Risk Management
	Contracts	$	2,917	$	6,495	$	6,183	$	(5,797)	$	(6,845)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	2,699	$	9,117	$	22,154	$	658	$	526
Sales to AEP Affiliates			33		23		45		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			223		115		(4,208)		276		2,046
Regulatory Liabilities (a)			10,896		(1,664)		(105)		853		1,032
Total Gain (Loss) on Risk Management
	Contracts	$	13,851	$	7,591	$	17,886	$	1,787	$	3,604
(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 June 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(2,117)	$	(1,508)	$	(3,149)	$	67	$	66
Changes in Fair Value Recognized in AOCI					(403)		(234)		(525)		(155)		(149)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	1,293	$	(11,320)	$	9,114	$	7,029	$	(17,365)
Changes in Fair Value Recognized in AOCI					-		(7,844)		-		-		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		149		(341)		(190)		560
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(824)	$	(12,828)	$	5,965	$	7,096	$	(17,299)
Changes in Fair Value Recognized in AOCI					(403)		(8,078)		(525)		(155)		(150)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		149		(341)		(190)		560
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended June 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	238	$	101	$	269	$	264	$	244
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		(26)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	217	$	(8,255)	$	10,473	$	7,787	$	(4,058)
Changes in Fair Value Recognized in AOCI					-		-		-		-		794
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		251		(341)		(189)		207
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	455	$	(8,154)	$	10,742	$	8,051	$	(3,814)
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		768
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		251		(341)		(189)		207
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					(2,248)		(1,628)		(3,402)		(16)		(17)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
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					-		(4,848)		-		-		(2,777)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			538		298		(682)		(379)		1,433
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
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					(2,248)		(6,476)		(3,402)		(16)		(2,794)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			538		298		(682)		(379)		1,433
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					123		53		143		180		168
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
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)		-		-		(476)		801
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			642		503		(682)		(332)		414
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
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					(250)		53		143		(296)		969
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			642		503		(682)		(332)		414
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
(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 Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
June 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	$	963	$	-	$	3,771	$	-	$	(1,820)	$	1,562
I&M		677		-		2,606		18,095		(1,246)		(19,015)
OPCo		1,420		-		5,500		-		(2,639)		8,774
PSO		-		-		141		-		(102)		6,839
SWEPCo		-		-		136		-		(97)		(16,806)

	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	$	(1,543)	$	(1,021)		23
I&M		(1,057)		(938)		23
OPCo		(2,236)		1,359		23
PSO		(89)		759		18
SWEPCo		(84)		(2,369)		18

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

	June 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	$	1,929	$	2,664	$	2,664
I&M		1,357		1,874		1,874
OPCo		2,845		3,928		3,928
PSO		-		1,002		269
SWEPCo		-		1,263		339

	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

	June 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	$	92,276	$	2,294	$	37,533
I&M		83,000		1,613		44,495
OPCo		136,073		3,383		55,347
PSO		150		-		44
SWEPCo		189		-		55
	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
June 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		179,238		126,489		264,309		35		44
	Coal		Tons		2,745		1,842		6,337		1,915		2,857
	Natural Gas		MMBtus		12,501		8,793		18,435		78		98
	Heating Oil and
		Gasoline	Gallons		667		348		823		372		357
	Interest Rate		USD	$	36,230	$	25,484	$	53,426	$	-	$	-
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

	June 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	$	2,664	$	19,667	$	4,291	$	28,964
I&M		1,874		13,793		2,752		18,547
OPCo		3,929		28,948		5,810		39,183
PSO		30		136		53		130
SWEPCo		37		133		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
June 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		$	4,961	$	-	$	-	$	(4,369)	$	592
Long-term Risk Management Assets			383		-		-		(252)		131
Total Assets			5,344		-		-		(4,621)		723
Current Risk Management Liabilities			8,987		120		-		(4,456)		4,651
Long-term Risk Management Liabilities			2,740		21		-		(271)		2,490
Total Liabilities			11,727		141		-		(4,727)		7,141
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	(6,383)	$	(141)	$	-	$	106	$	(6,418)
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 June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(599)	$	2,579	$	2,538	$	165	$	303
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(3,796)		(2,905)		(8,895)		(757)		(364)
Regulatory Liabilities (a)			4,711		392		7,178		(26)		(27)
Total Gain (Loss) on Risk Management
	Contracts	$	316	$	66	$	821	$	(618)	$	(88)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	883	$	3,702	$	11,564	$	539	$	403
Sales to AEP Affiliates			13		6		13		(1)		(1)
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(150)		(1,018)		(4,603)		644		404
Regulatory Liabilities (a)			4,142		(1,077)		-		461		692
Total Gain (Loss) on Risk Management
	Contracts	$	4,888	$	1,613	$	6,974	$	1,643	$	1,498

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(926)	$	5,392	$	11,031	$	160	$	252
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(7,277)		(6,015)		(12,026)		(5,958)		(7,092)
Regulatory Liabilities (a)			11,120		7,118		7,178		1		(5)
Total Gain (Loss) on Risk Management
	Contracts	$	2,917	$	6,495	$	6,183	$	(5,797)	$	(6,845)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	2,699	$	9,117	$	22,154	$	658	$	526
Sales to AEP Affiliates			33		23		45		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			223		115		(4,208)		276		2,046
Regulatory Liabilities (a)			10,896		(1,664)		(105)		853		1,032
Total Gain (Loss) on Risk Management
	Contracts	$	13,851	$	7,591	$	17,886	$	1,787	$	3,604
(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 June 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(2,117)	$	(1,508)	$	(3,149)	$	67	$	66
Changes in Fair Value Recognized in AOCI					(403)		(234)		(525)		(155)		(149)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	1,293	$	(11,320)	$	9,114	$	7,029	$	(17,365)
Changes in Fair Value Recognized in AOCI					-		(7,844)		-		-		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		149		(341)		(190)		560
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(824)	$	(12,828)	$	5,965	$	7,096	$	(17,299)
Changes in Fair Value Recognized in AOCI					(403)		(8,078)		(525)		(155)		(150)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		149		(341)		(190)		560
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended June 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	238	$	101	$	269	$	264	$	244
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		(26)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	217	$	(8,255)	$	10,473	$	7,787	$	(4,058)
Changes in Fair Value Recognized in AOCI					-		-		-		-		794
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		251		(341)		(189)		207
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	455	$	(8,154)	$	10,742	$	8,051	$	(3,814)
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		768
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		251		(341)		(189)		207
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					(2,248)		(1,628)		(3,402)		(16)		(17)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
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					-		(4,848)		-		-		(2,777)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			538		298		(682)		(379)		1,433
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
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					(2,248)		(6,476)		(3,402)		(16)		(2,794)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			538		298		(682)		(379)		1,433
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					123		53		143		180		168
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
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)		-		-		(476)		801
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			642		503		(682)		(332)		414
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
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					(250)		53		143		(296)		969
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			642		503		(682)		(332)		414
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
(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 Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
June 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	$	963	$	-	$	3,771	$	-	$	(1,820)	$	1,562
I&M		677		-		2,606		18,095		(1,246)		(19,015)
OPCo		1,420		-		5,500		-		(2,639)		8,774
PSO		-		-		141		-		(102)		6,839
SWEPCo		-		-		136		-		(97)		(16,806)

	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	$	(1,543)	$	(1,021)		23
I&M		(1,057)		(938)		23
OPCo		(2,236)		1,359		23
PSO		(89)		759		18
SWEPCo		(84)		(2,369)		18

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

	June 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	$	1,929	$	2,664	$	2,664
I&M		1,357		1,874		1,874
OPCo		2,845		3,928		3,928
PSO		-		1,002		269
SWEPCo		-		1,263		339

	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

	June 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	$	92,276	$	2,294	$	37,533
I&M		83,000		1,613		44,495
OPCo		136,073		3,383		55,347
PSO		150		-		44
SWEPCo		189		-		55
	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
June 30, 2012
Primary Risk			Unit of
Exposure			Measure	APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Commodity:
	Power		MWHs		179,238		126,489		264,309		35		44
	Coal		Tons		2,745		1,842		6,337		1,915		2,857
	Natural Gas		MMBtus		12,501		8,793		18,435		78		98
	Heating Oil and
		Gasoline	Gallons		667		348		823		372		357
	Interest Rate		USD	$	36,230	$	25,484	$	53,426	$	-	$	-
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

	June 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	$	2,664	$	19,667	$	4,291	$	28,964
I&M		1,874		13,793		2,752		18,547
OPCo		3,929		28,948		5,810		39,183
PSO		30		136		53		130
SWEPCo		37		133		66		124

Fair Value of Derivative Instruments

Fair Value of Derivative Instruments
June 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		$	13,572	$	-	$	-	$	(12,275)	$	1,297
Long-term Risk Management Assets			1,074		-		-		(706)		368
Total Assets			14,646		-		-		(12,981)		1,665
Current Risk Management Liabilities			20,246		115		-		(12,352)		8,009
Long-term Risk Management Liabilities			1,039		21		-		(725)		335
Total Liabilities			21,285		136		-		(13,077)		8,344
Total MTM Derivative Contract Net
	Assets (Liabilities)	$	(6,639)	$	(136)	$	-	$	96	$	(6,679)
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 June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(599)	$	2,579	$	2,538	$	165	$	303
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(3,796)		(2,905)		(8,895)		(757)		(364)
Regulatory Liabilities (a)			4,711		392		7,178		(26)		(27)
Total Gain (Loss) on Risk Management
	Contracts	$	316	$	66	$	821	$	(618)	$	(88)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Three Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	883	$	3,702	$	11,564	$	539	$	403
Sales to AEP Affiliates			13		6		13		(1)		(1)
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(150)		(1,018)		(4,603)		644		404
Regulatory Liabilities (a)			4,142		(1,077)		-		461		692
Total Gain (Loss) on Risk Management
	Contracts	$	4,888	$	1,613	$	6,974	$	1,643	$	1,498

Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2012
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	(926)	$	5,392	$	11,031	$	160	$	252
Sales to AEP Affiliates			-		-		-		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			(7,277)		(6,015)		(12,026)		(5,958)		(7,092)
Regulatory Liabilities (a)			11,120		7,118		7,178		1		(5)
Total Gain (Loss) on Risk Management
	Contracts	$	2,917	$	6,495	$	6,183	$	(5,797)	$	(6,845)
Amount of Gain (Loss) Recognized on
Risk Management Contracts
For the Six Months Ended June 30, 2011
Location of Gain (Loss)		APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Electric Generation, Transmission and
	Distribution Revenues	$	2,699	$	9,117	$	22,154	$	658	$	526
Sales to AEP Affiliates			33		23		45		-		-
Fuel and Other Consumables Used for
	Electric Generation		-		-		-		-		-
Regulatory Assets (a)			223		115		(4,208)		276		2,046
Regulatory Liabilities (a)			10,896		(1,664)		(105)		853		1,032
Total Gain (Loss) on Risk Management
	Contracts	$	13,851	$	7,591	$	17,886	$	1,787	$	3,604
(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 June 30, 2012
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(2,117)	$	(1,508)	$	(3,149)	$	67	$	66
Changes in Fair Value Recognized in AOCI					(403)		(234)		(525)		(155)		(149)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	1,293	$	(11,320)	$	9,114	$	7,029	$	(17,365)
Changes in Fair Value Recognized in AOCI					-		(7,844)		-		-		(1)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		149		(341)		(190)		560
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2012				$	(824)	$	(12,828)	$	5,965	$	7,096	$	(17,299)
Changes in Fair Value Recognized in AOCI					(403)		(8,078)		(525)		(155)		(150)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			157		419		1,099		-		-
		Other Operation Expense			(14)		(8)		(19)		(9)		(7)
		Maintenance Expense			(6)		(3)		(8)		(2)		(2)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		149		(341)		(190)		560
		Property, Plant and Equipment			(10)		(6)		(13)		(3)		(5)
		Regulatory Assets (a)			576		103		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Three Months Ended June 30, 2011
Commodity Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	238	$	101	$	269	$	264	$	244
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		(26)
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
Interest Rate and
Foreign Currency Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	217	$	(8,255)	$	10,473	$	7,787	$	(4,058)
Changes in Fair Value Recognized in AOCI					-		-		-		-		794
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			269		251		(341)		(189)		207
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
Total Contracts				APCo		I&M		OPCo		PSO		SWEPCo
				(in thousands)
Balance in AOCI as of March 31, 2011				$	455	$	(8,154)	$	10,742	$	8,051	$	(3,814)
Changes in Fair Value Recognized in AOCI					(55)		(25)		(64)		(32)		768
Amount of (Gain) or Loss Reclassified
	from AOCI to Statement of Income/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		175		396		1,060		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			(41)		(92)		(246)		-		-
		Other Operation Expense			(31)		(28)		(60)		(34)		(33)
		Maintenance Expense			(65)		(22)		(51)		(22)		(24)
		Depreciation and Amortization
			Expense		-		-		1		-		-
		Interest Expense			269		251		(341)		(189)		207
		Property, Plant and Equipment			(57)		(28)		(71)		(36)		(29)
		Regulatory Assets (a)			505		76		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					(2,248)		(1,628)		(3,402)		(16)		(17)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(1,820)	$	(1,246)	$	(2,639)	$	(102)	$	(97)
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					-		(4,848)		-		-		(2,777)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			538		298		(682)		(379)		1,433
Balance in AOCI as of June 30, 2012				$	1,562	$	(19,015)	$	8,774	$	6,839	$	(16,806)
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					(2,248)		(6,476)		(3,402)		(16)		(2,794)
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		(3)		(9)		(24)		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			376		986		2,585		-		-
		Other Operation Expense			(16)		(10)		(24)		(11)		(9)
		Maintenance Expense			(9)		(4)		(10)		(2)		(3)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			538		298		(682)		(379)		1,433
		Property, Plant and Equipment			(12)		(7)		(16)		(4)		(6)
		Regulatory Assets (a)			1,401		245		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2012				$	(258)	$	(20,261)	$	6,135	$	6,737	$	(16,903)

Total Accumulated Other Comprehensive Income (Loss) Activity for Cash Flow Hedges
For the Six Months Ended June 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					123		53		143		180		168
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	669	$	378	$	837	$	140	$	132
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)		-		-		(476)		801
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Other Operation Expense			-		-		-		-		-
		Interest Expense			642		503		(682)		(332)		414
Balance in AOCI as of June 30, 2011				$	486	$	(8,004)	$	10,133	$	7,598	$	(3,057)
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					(250)		53		143		(296)		969
Amount of (Gain) or Loss Reclassified
	from AOCI to Income Statement/within
	Balance Sheet:
		Electric Generation, Transmission, and
			Distribution Revenues		171		386		1,034		-		-
		Fuel and Other Consumables Used for
			Electric Generation		-		-		-		-		-
		Purchased Electricity for Resale			46		102		275		-		-
		Other Operation Expense			(44)		(37)		(83)		(47)		(46)
		Maintenance Expense			(90)		(32)		(70)		(29)		(32)
		Depreciation and Amortization
			Expense		-		-		2		-		-
		Interest Expense			642		503		(682)		(332)		414
		Property, Plant and Equipment			(80)		(39)		(98)		(52)		(40)
		Regulatory Assets (a)			816		123		-		-		-
		Regulatory Liabilities (a)			-		-		-		-		-
Balance in AOCI as of June 30, 2011				$	1,155	$	(7,626)	$	10,970	$	7,738	$	(2,925)
(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 Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’
Condensed Balance Sheets
June 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	$	963	$	-	$	3,771	$	-	$	(1,820)	$	1,562
I&M		677		-		2,606		18,095		(1,246)		(19,015)
OPCo		1,420		-		5,500		-		(2,639)		8,774
PSO		-		-		141		-		(102)		6,839
SWEPCo		-		-		136		-		(97)		(16,806)

	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	$	(1,543)	$	(1,021)		23
I&M		(1,057)		(938)		23
OPCo		(2,236)		1,359		23
PSO		(89)		759		18
SWEPCo		(84)		(2,369)		18

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

	June 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	$	1,929	$	2,664	$	2,664
I&M		1,357		1,874		1,874
OPCo		2,845		3,928		3,928
PSO		-		1,002		269
SWEPCo		-		1,263		339

	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

	June 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	$	92,276	$	2,294	$	37,533
I&M		83,000		1,613		44,495
OPCo		136,073		3,383		55,347
PSO		150		-		44
SWEPCo		189		-		55
	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