AEP to Sell TCC Share of South Texas Project to Co-Owners

AEP to Sell TCC Share of South Texas Project to Co-Owners
Texas Genco and City Public Service Board of San Antonio Exercise Rights of
First Refusal 


COLUMBUS, Ohio, Sept. 7  /PRNewswire-FirstCall/ -- American Electric Power
(NYSE:AEP) subsidiary AEP Texas Central Company (formerly known as Central
Power and Light) has signed an agreement to sell its 25.2 percent share of the
South Texas Project (STP) nuclear plant to STP co-owners Texas Genco Holdings,
Inc. (NYSE:TGN) and City Public Service Board of San Antonio (CPS) after the
co-owners exercised their rights of first refusal for the AEP Texas Central
Company (TCC) share of STP.

Texas Genco Holdings will purchase 13.2 percent of STP for approximately $174
million. CPS will purchase 12 percent of STP for approximately $158 million.
When the transactions are complete, Texas Genco Holdings will own 44 percent of
STP, and CPS will own 40 percent of STP. The City of Austin elected not to
exercise its right of first refusal for the TCC share of the plant and will
continue to own 16 percent of STP. STP is operated by STP Nuclear Operating
Company. AEP will use the proceeds from the sale to reduce debt.

AEP had announced a purchase agreement with Cameco Corp. for the TCC share of
STP March 1. The terms and conditions of the new purchase agreements signed
with Texas Genco Holdings and CPS will remain essentially the same as the
agreement signed with Cameco. AEP will pay a $7 million break-up fee to Cameco
upon termination of the Cameco purchase and sale agreement due to the
right-of-first-refusal exercise.

The sale of STP to the co-owners is subject to regulatory approvals including
federal clearance pursuant to the Hart-Scott-Rodino Antitrust Improvements Act
of 1976 and approvals from the Nuclear Regulatory Commission, Federal Energy
Regulatory Commission, and Securities and Exchange Commission. AEP hopes to
close the transaction in late 2004 or early 2005.

"We are pleased to have reached an agreement with the co-owners of STP and will
be working diligently to complete the approval process as soon as possible. We
also continue to prepare to file for stranded cost recovery as soon as we close
the TCC sale transactions," said Charles Patton, AEP Texas president and chief
operating officer.

STP is a 2,500-megawatt nuclear plant located in Matagorda County, Texas,
approximately 90 miles southwest of Houston. TCC's 25.2 percent share of the
plant is approximately 630 megawatts.

AEP announced plans in December 2002 to sell all 4,497 MW of the generation
assets owned by TCC to determine their market value for calculating stranded
costs (the amount that the book value exceeds the market value of the assets)
under Texas restructuring legislation. AEP completed sale of 3,813 MW of these
generating assets, including eight natural gas plants, one coal-fired plant and
one hydro plant, to a joint venture of Sempra Energy Partners and
Carlyle/Riverstone Global Energy and Power Fund July 1. AEP continues to work
toward completing the sale of TCC's 7.8 percent share of Oklaunion Plant.

American Electric Power owns more than 36,000 megawatts of generating capacity
in the United States and is the nation's largest electricity generator.  AEP is
also one of the largest electric utilities in the United States, with more than
5 million customers linked to AEP's 11-state electricity transmission and
distribution grid. The company is based in Columbus, Ohio.

This report made by AEP and certain of its subsidiaries contains
forward-looking statements within the meaning of Section 21E of the Securities
Exchange Act of 1934. Although AEP and each of its registrant subsidiaries
believe that their expectations are based on reasonable assumptions, any such
statements may be influenced by factors that could cause actual outcomes and
results to be materially different from those projected. Among the factors that
could cause actual results to differ materially from those in the
forward-looking statements are: electric load and customer growth; weather
conditions; available sources and costs of fuels; availability of generating
capacity and the performance of AEP's generating plants; the ability to recover
regulatory assets and stranded costs in connection with deregulation; new
legislation and government regulation including requirements for reduced
emissions of sulfur, nitrogen, mercury, carbon and other substances; resolution
of pending and future rate cases, negotiations and other regulatory decisions
(including rate or other recovery for environmental compliance); oversight
and/or investigation of the energy sector or its participants; resolution of
litigation (including pending Clean Air Act enforcement actions and disputes
arising from the bankruptcy of Enron Corp.); AEP's ability to reduce its
operation and maintenance costs; the success of disposing of investments that
no longer match AEP's business model; AEP's ability to sell assets at
acceptable prices and on other acceptable terms; international and
country-specific developments affecting foreign investments including the
disposition of any foreign investments; the economic climate and growth in
AEP's service territory and changes in market demand and demographic patterns;
inflationary trends; AEP's ability to develop and execute a strategy based on a
view regarding prices of electricity, natural gas, and other energy-related
commodities; changes in the creditworthiness and number of participants in the
energy trading market; changes in the financial markets, particularly those
affecting the availability of capital and AEP's ability to refinance existing
debt at attractive rates; actions of rating agencies, including changes in the
ratings of debt and preferred stock; volatility and changes in markets for
electricity, natural gas, and other energy-related commodities; changes in
utility regulation, including the establishment of a regional transmission
structure; accounting pronouncements periodically issued by accounting
standard-setting bodies; the performance of AEP's pension plan; prices for
power that AEP generates and sells at wholesale; changes in technology and
other risks and unforeseen events, including wars, the effects of terrorism
(including increased security costs), embargoes and other catastrophic events. 

DATASOURCE: American Electric Power



CONTACT:  Media, Pat D. Hemlepp, Director, Corporate Media Relations,

[phone], or Analysts, Julie Sloat, Vice President, Investor Relations,

[phone], both of American Electric Power



Web site:  http://www.aep.com/ 



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