STATE OF INDIANA

Before the

INDIANA UTILITY REGULATORY COMMISSION

IN THE MATTER OF THE PETITION of

AEP GENERATING COMPANY

for all necessary authority in connection with a $150,000,000 financing program involving the issuance of long-term debt consisting of secured or unsecured promissory notes of one or more new series.

Cause No.

VERIFIED PETITION

TO THE INDIANA UTILITY REGULATORY COMMISSION:

The Petitioner, AEP Generating Company ("Petitioner" or "AEGCo"), respectfully petitions

the Commission for the relief hereinafter described and in support thereof states that:

1. Petitioner is a corporation organized and existing under the laws of the State of Ohio,

having its principal executive office at 1 Riverside Plaza, Columbus, Ohio. AEGCo is duly admitted

and qualified to transact business in the State of Indiana. AEGCo is a wholly-owned subsidiary of

American Electric Power Company, Inc. ("AEP"). AEGCO (a) has a 50% undivided ownership

interest in Unit 1 of the Rockport Generating Station located in Spencer County, Indiana ("Rockport

Plant"), and (b) has a 50% leasehold interest in Unit 2 of the Rockport Plant with its affiliate Indiana

Michigan Power Company ("I&M"). AEGCo sells all of its power from these facilities at wholesale

to certain of its utility company affiliates under long-term contracts approved by the Federal Energy

Regulatory Commission. AEGCo makes no retail sales of power. It is a public utility as defined by

the Public Service Commission Act I.C. 8-1-2-1, et m. (the "Act"), and is subject to the jurisdiction

of this Commission in the manner and to the extent provided by the laws of the State of Indiana.

1820867.1

45359

Petitioner proposes to issue and sell, from time to time through December 31, 2022,

in one or more transactions, up to $150,000,000 aggregate principal amount long-term debt securities.

Long-term debt securities may consist of secured and/or unsecured notes, as more particularly set

forth herein.

2. Petitioner has outstanding 1,000 shares of Common Stock, par value $1,000 per share,

as of December 31, 2019.

3. As of December 31, 2019, Petitioner had outstanding $195,000,000 in principal

amount of long-term unsecured debt securities.

4. Petitioner is a party to an Agreement of Sale with the City of Rockport, Indiana (the

"City"), whereby it is acquiring a 50% interest in pollution control facilities at the Rockport Plant

financed by the issuance by the City of pollution control revenue bonds in connection therewith.

Currently the City has approximately $45 million in principal amount of such bonds outstanding.

Payments by Petitioner under said Agreement of Sale and similar payments under a separate

agreement by l&M service such outstanding bonds of the City.

The Petitioner also had outstanding as of December 31, 2019, $16,685,552 in capital leases.

5. Petitioner's balance sheet as of December 31, 2019, and income statement for the

three and twelve months ended December 31, 2019, are attached hereto as Exhibit A and made a

part hereof. As of December 31, 2019, Petitioner had invested in utility plant the amount of

$493,561,670 (net of depreciation).

6. The secured and/or unsecured notes (the "Notes") authority for which is sought by

this Petition may be issued in the form of Senior or Subordinated Notes or other types of promissory

notes. The Notes will be sold (i) by competitive bidding, (ii) in negotiated transactions with

underwriters or agents or (iii) by direct placement with a commercial bank or other institutional

investor.

2

Each series of long-term debt issued directly by Petitioner would have such

designation, aggregate principal amount, maturity, interest rate(s) or methods of determining the

same, terms of payment of interest, redemption provisions, sinking fund terms and other terms and

conditions as Petitioner may determine at the time of issuance. Any long-term debt (a) will have

maturities up to 60 years, (b) may be subject to optional and/or mandatory redemption, in whole or

in part, at par or at various premiums above the principal amount thereof, (c) may be entitled to

mandatory or optional sinking fund provisions, (d) may provide for reset of the coupon pursuant to a

remarketing arrangement, (e) may be subject to tender or the obligation of the issuer to repurchase

at the election of the holder or upon the occurrence of a specified event, (f) may be called from

existing investors by a third party and (g) may be entitled to the benefit of affirmative or negative

financial or other covenants.

The maturity dates, interest rates, redemption and sinking fund provisions, tender or

repurchase and conversion features, if any, with respect to the long-term debt of a particular series, as

well as any associated placement, underwriting or selling agent fees, commissions and discounts, if

any, will be established by negotiation or competitive bidding. Specific terms of any long-term debt

will be determined by Petitioner at the time of issuance and will comply in all regards with the

parameters on financing authorization set forth above.

AEGCO may issue one or more Notes in connection with long-term borrowing from

AEP, in which case the interest rates and maturity dates of the borrowings would be designed to

parallel the cost of capital of AEP. Notes issued by Petitioner will be sold at the lowest interest rates

reasonably obtainable. By historical standards, the yield to maturity of such Notes should not exceed

by more than 4.0% the yield to maturity on United States Treasury obligations of comparable maturity

at the time of pricing. Any initial fluctuating rate of interest on the Notes will not exceed 8% at the

time of issuance. Petitioner may agree to specific redemption provisions, including redemption

premiums, at the time of the pricing. The Notes may provide for reset of the coupon pursuant to a

3

remarketing arrangement, may be subject to tender or the obligation of the issuer to repurchase at the

election of the holder or upon the occurrence of a specified event, may be amortizing and may be

entitled to the benefit of affirmative or negative financial or other covenants.

In connection with the sale of unsecured Notes, Petitioner may agree to restrictive

covenants which would prohibit it from, among other things: (i) creating or permitting to exist any

liens on its property, with certain stated exceptions; (ii) creating indebtedness except as specified

therein; (iii) failing to maintain a specified financial condition; (iv) entering into certain mergers,

consolidations and dispositions of assets; and (v) permitting certain events to occur in connection with

pension plans. In addition, Petitioner may permit the holder of the Notes to require Petitioner to

prepay them after certain specified events, including an ownership change.

It is difficult to determine, under present market conditions, whether it would be more

advantageous to Petitioner to sell its Notes with a longer maturity or a shorter maturity. It is in the

public interest, however, that Petitioner be afforded the necessary flexibility to adjust its financing

program to developments in the markets for medium and long-term debt securities when and as they

occur in order to obtain the best reasonably available price, interest rate and terms for its Notes.

It is requested, therefore, that Petitioner be given the flexibility to decide at future dates

whether there will be one or more series, and on the maturity of each series, of the Notes. Any specific

redemption provisions will be determined at the time of the pricing of each series of Notes.

Notes may be issued under an Indenture as to be supplemented and amended by

one or more Company Orders, or other similar documentation.

7. Petitioner, to allow it the flexibility to reduce and manage interest costs with respect

to the Notes or any Pollution Control Refunding Bonds issued by a governmental agency, needs

the authority to utilize when available interest rate hedging transactions and anticipatory interest

rate hedging transactions (collectively "Interest Rate Hedges") and enter into related interest rate

hedging agreements ("interest rate hedging agreements"). Such techniques and agreements

include, but are not limited to, "interest rate swaps," "caps," "collars," "floors," "options" or

4

hedging products such as "forwards" or similar products, the purpose of which is to manage and

minimize interest costs. Petitioner expects to enter into any such agreements with counterparties

that are highly rated financial institutions. Because market opportunities for these interest rate

management alternatives are transitory, Petitioner must be able, and requests authority, to execute

interest rate hedging agreements when the opportunity arises to obtain the most competitive

pricing.

8. If it is deemed advisable, Petitioner may provide some form of credit enhancement

for the Notes, such as a letter of credit or surety bond and Petitioner may pay a fee in connection

therewith.

9. Any proceeds realized from the sale of the Notes, together with any other funds which

may become available to the Petitioner, may be used for the refunding directly or indirectly of

currently outstanding debt, and for construction costs and working capital.

10. Petitioner deems it advisable and in its best interests, as well as in the public interest,

to effect the financings proposed herein to use the proceeds thereof for the purposes hereinabove set

forth. The proposed financings are reasonably necessary in the operation and management of

Petitioner's business in order that Petitioner may provide adequate service and facilities. The capital

structure of Petitioner after giving effect to the proposed financing will be reasonable and in the public

interest. The total amount of the proposed financings, together with the Petitioner's outstanding stock,

notes maturing more than 12 months from the date thereof, and other evidences of indebtedness of

Petitioner, will not be in excess of the fair value of Petitioner's utility property.

11. This Petition is filed pursuant to sections of the Act, as amended, appearing as I.C. 8-

1-2-76 to 8-1-2-80, inclusive, and I.C. 8-1-4-1, which are deemed to be applicable.

12. The name and address of Petitioner's attorney in this proceeding is Kay Pashos,

Ice Miller LLP, One American Square, Suite 2900, Indianapolis, IN 46282-0200. Kay Pashos of

said firm is duly authorized to accept service of papers in this proceeding on behalf of Petitioner.

5

13. The undersigned affirm under penalties for perjury that the foregoing representations

are true to the best of their knowledge, information and belief.

WHEREFORE, Petitioner respectfully prays that this Commission grant it authority to:

A. issue and sell through December 31, 2022 up to $150,000,000 aggregate

principal amount of secured or unsecured long-term debt securities in one

or more series, to have such interest rates and terms and conditions as may

be approved, fixed or otherwise determined by Petitioner in the manner

herein proposed, at the best prices obtainable in the judgment of Petitioner

and consistent with the limitations described herein, and to enter into one or

more interest rate management agreements, as described in section 7 of this

Petition or credit enhancement as described in section 8 of this Petition;

B. use the proceeds of the securities authorized for the purposes, and to account

for premiums paid in connection with the redemption or reacquisition of its

securities and any interest rate hedging transactions, as described herein;

C. grant all other and further relief necessary or appropriate in the premises.

6

AEP GEN • TING COMPANY

Juli Vi

Attest:

William E. Johnson Assistant Secretary

Kay Pashos, Atty. No. 11644-49 Ice Miller LLP One American Square Suite 2900 Indianapolis, IN 46282-0200 317-236-2208 (telephone) 317-592-4676 (facsimile) kay.pashos@icemiller.com Attorney for Petitioner

7

A

Juli.PA. - . Vice President

By: William E. Johnson Assistant Secretary

Date: March 17, 2020

By:

VERIFICATIONS

We affirm under penalties for perjury that the foregoing representations are true to the best of our knowledge, information, and belief.

8

EXHIBITS

A Balance Sheet as of December 31, 2019, and Statements of Income and Retained Earnings for the three and twelve months ended December 31, 2019.

9

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