PATH, AEP to withdraw applications for transmission project

PJM has indicated that it will undertake an evaluation of its planning methods through a stakeholder process

Akron, Ohio, February 28, 2011 — American Electric Power and FirstEnergy Corp. announced their affiliates will file to withdraw their applications for state regulatory approval of the Potomac-Appalachian Transmission Highline (PATH) project following an announcement by regional grid operator PJM Interconnection that the project has been suspended.

PATH is a joint venture between the former Greensburg, Pa-based Allegheny Energy and AEP to build a 765-kV, 275-mile transmission project from Putnam County, W.Va., to Frederick County, Md. Allegheny merged with Akron-based FirstEnergy, effective February 25, 2011.

The filings in Virginia, Maryland and West Virginia are in response to a directive by regional grid operator PJM Interconnection to suspend further development of the PATH project while PJM conducts a more rigorous analysis of the potential need for PATH as part of its continuing Regional Transmission Expansion Plan.

PJM directed the construction of PATH in 2007 to resolve violations of national and local standards for reliable operation of the region's transmission system. Since then, annual studies reaffirmed the need for PATH as the recommended solution for resolving these issues. However, PJM's latest analyses indicate that the projected need for the project has moved well into the future.

PJM has indicated that it will undertake an evaluation of its planning methods through a stakeholder process.

This process will evaluate the criteria used to determine the need for transmission projects under its Regional Transmission Expansion Plan, and determine whether the need for PATH should be re-evaluated in light of any approved revisions to its planning process. Once this process is complete, PJM will reassess the need for transmission expansion in the region.

Until then, the PATH companies will immediately suspend most activities on the project except for those that may be necessary to return the project to active status at the conclusion of PJM's planning process review.

Prior to its recently completed merger with FirstEnergy, Allegheny Energy was a publicly traded, diversified energy company with more than $3 billion in annual revenue.

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