Bette Jo Rozsa - Former Managing Director of Investor Relations Nicholas K. Akins - Chief Executive Officer, President, Director, Member of Executive Committee and Member of Policy Committee Brian X. Tierney - Chief Financial Officer and Executive Vice President

Greg Gordon - ISI Group Inc., Research Division Dan Eggers - Crédit Suisse AG, Research Division Kit Konolige - BGC Partners, Inc., Research Division Stephen Byrd - Morgan Stanley, Research Division Jonathan P. Arnold - Deutsche Bank AG, Research Division Paul T. Ridzon - KeyBanc Capital Markets Inc., Research Division Steven I. Fleishman - Wolfe Research, LLC Anthony C. Crowdell - Jefferies LLC, Research Division Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division Paul Patterson - Glenrock Associates LLC Michael J. Lapides - Goldman Sachs Group Inc., Research Division

Ladies and gentlemen, thank you for standing by. Welcome to the American Electric Power Third Quarter 2013 Earnings Conference Call. [Operator Instructions] As a reminder, today's conference is being recorded. And now I would now like to turn the conference over to your host, Ms. Bette Jo Rozsa, please go ahead.

Thank you, Brad. Good morning, everyone, and welcome to the third quarter 2013 earnings webcast of American Electric Power. Our earnings release presentation slides and related financial information are available on our website at aep.com. Today, we will be making forward-looking statements during the call. There are many factors that may cause future results to differ materially from these statements. Please refer to our SEC filings for a discussion of these factors. Joining me this morning for opening remarks are Nick Akins, our President and Chief Executive Officer; and Brian Tierney, our Chief Financial Officer. We will take your questions following their remarks. I will now turn the call over to Nick. Nicholas K. Akins: Thanks, Bette Jo. So today, I'm happy to report that AEP had a good third quarter. With our performance in this quarter, we have decided to modify our guidance range for 2013 to the upper end of the guidance range. Originally, it was $3.05 to $3.25 range we had previously reported. We're changing that to $3.15 to $3.25 with a $3.20 midpoint. Despite the continued overall stagnation of the economy, the continuous improvement in cost savings initiatives that our employees continue to focus on have provided the company's ability to fully react to the current environment. These sustainable initiatives and others to follow will continue to provide benefits to our customers and our shareholders. Coupled with our previous announcement by our board to increase the dividend payable by $0.01 a share to $0.50 a share, these actions have been consistent with our plan to ensure continued positive performance for our shareholders. We've increased our dividend by 3.72% on the annualized basis, with a 61% payout ratio, which is within our 60% to 67% -- 60% to 70% targeted range. The third quarter came in at $0.89 per share on a GAAP basis and $1.10 per share on an operating earnings basis. The difference this quarter is mainly attributable to the surprising decision by the PUCT to include -- the Public Utility Commission of Texas to include AFUDC and the cost cap related to the Turk power plant at SWEPCO, and a smaller impairment related to the Big Sandy scrubber project cost that was disallowed as part of the order in Kentucky approving 50% of the Mitchell plant to be transferred to Kentucky Power rate base. I'll discuss these cases in more detail a little bit later. But so far this year, we stand at $2.33 a share on a GAAP basis and $2.63 per share on an operating basis, with the differences attributable to the impairments that I just mentioned, along with other impairments and benefits from previous quarters that we reported. Despite the impairments of the last quarter, we performed well from an operating earnings perspective and I'm proud of our employees' efforts to control costs as an outcome of our repositioning efforts and continuous improvements. Also solid regulatory recovery, benefits and continued positive transmission performance have contributed as well. We're pleased to see increases in the commercial load, primarily in Texas and Ohio, for the third quarter, but our residential and industrial load continues to be challenged. The makeup of the top of load though, combined with the margins in each class, has resulted in a small year-to-date financial impact. However, the oscillating nature of the quarter-to-quarter load cycles, as we've looked at previous quarters that we've reported, indicate a still tenuous economy. I sort of call it a whack-a-mole economy because the growth in each sector has not been well synchronized to indicate the true overall economic growth. Industrial load continues to be -- to lag across many sectors, including primary metals in mining, partially offset, though, in our service territory by the shale gas activity in Texas and Ohio. Moving to the major regulatory activities during the quarter, we were pleased overall with the Kentucky asset transfer order. We received permission to transfer 50% of the Mitchell plant to Kentucky Power and put in place a $44 million surcharge while freezing base rates for a period of time. We also keep the offsets in sales margins and the capacity payments, so it turned out to be a good order. The Kentucky commission did disallow, as I mentioned earlier, certain scrubber project-related expenses that we had earlier. The West Virginia case continues -- we continue to wait for a commission order, which we expect relatively soon. But based on the outcome that we saw in the FE, FirstEnergy transfer order, we expect to have a reasonable outcome there as well. Regarding the Texas rate case order involving Turk -- the Turk power plant-related cost, we were pleased that the plant was found to be prudent and the imposition, obviously, the retroactive rates that we had mentioned earlier to -- almost to the beginning of the year. But we were disappointed that the Texas Commission surprisingly included AFUDC in the cost cap related to the Turk construction costs. We'll be following a rehearing request with the commission to show that the case history and record does not support such an outcome. To not allow quip recovery that we had requested, and then also to not allow AFUDC recovery beyond what was clearly a cap on the construction cost to build the unit, would send, I believe, a bad policy message on a prudent incurred generation investment. We're indeed hopeful that after reviewing the record, the PUCT will reconsider its decision, particularly for a state that desperately needs to incent new generation capacity. We continue to be committed to delivering 4% to 6% earnings growth off of our original 2013 guidance. AEP believes that the cultural transformation efforts, along with the ingenuity of our employees to achieve cost savings through our continuous improvement efforts, will ultimately mitigate the headwinds of a lack of load growth. We believe our industry is no longer about just generation, transmission and distribution, but is focused on infrastructure investment, particularly in the transmission area and distribution, and the customer and employee experiences that include technological changes, and of course optimization of our portfolio of assets. So our company is transforming from that perspective. In November, the EEI will be discussing specific cost savings expectations in areas such as lean generation, lean wires, procurement, lean IT, corporate services from a lean perspective, the unregulated generation cost reduction initiatives that Chuck Zebula and his team are working on, as well as other growth-related initiative areas, such as transmission expansion and more effective cost allocation for capital -- capital allocations, excuse me. This detail will demonstrate our plan to achieve our 4% to 6% earnings growth rate plans for the future. So stay tuned for that. Now, as I turn to the equalizer chart, I call it my equalizer chart on Page 4 of the presentation, I'll sort of go through state-by-state, jurisdiction by jurisdiction where we stand. The Ohio Power is showing up at 12.3%. Keep in mind that 12.3% does not include off-system sales, if you are thinking about it from a SEET perspective. If you exclude the offsets in sales from the 12.3%, that brings you down below the 12% SEET cap. So I know people have questions about that. So -- but it also, from an Ohio perspective, it doesn't include the $435 million of plant write-downs that we've taken this year. So when you look at Ohio, you have to think about that from a consideration perspective. For West Virginia, we continue to see improvement in West Virginia. We expect, as I said earlier, the order is expected pretty soon. So we would expect that to continue to increase. And then on Kentucky, it's a sort of a -- it is one of our smaller jurisdictions and we had a Big Sandy 2 outage here in the third quarter that had some O&M expense associated with that. So it's slightly lower than it was, but it continues in its positive trajectory as well, particularly with the Kentucky order now in place. And at I&M, that continues to improve. You're seeing -- because it is a 12-month rolling average, the recent rate case activity will continue to enable that to improve. PSO is pretty steady. It has decreased a little bit, but that's because, obviously, PSO is doing what it needs to do to continue to invest in its distribution territories. So, and then SWEPCO, we expect that to continue to improve because it's not fully reflected in terms of rates, the recent rate case development. It will continue to improve as well. And then AEP Texas is doing well. And then from a Transmission Operations standpoint, we continue to have heavy investments in transmission, so that return has come down slightly, but that's because of the heavy investment that's occurring and maybe a lag associated with that. So overall, I'd say the equalizer chart across the area is looking good. And there's just a slight change, I guess, from the previous quarter. But overall, it's a 10.3% overall regulated operations ROE, which I think is pretty favorable in this environment. So we've had a good, strong quarter. And we certainly are looking for continued activity in November at the EEI meeting and certainly Brian will talk a little bit more about the detail that we'll be providing there. So at this point, I'll turn it over to Brian. Brian X. Tierney: Thank you, Nick, and good morning, everyone. We're going to try a new format today for discussing comparative year-on-year results. In an effort to avoid repetition and tedium, I'll handle both quarterly and year-to-date reconciliations on the same slide, focusing primarily on the quarterly results, but adding color to the year-to-date results, as needed. If we find that this new method is not helpful, then we'll revert to the old format next time. In any event, the traditional slides that you are used to are in the appendix to the presentation. So here we go. On Slide 5, you will see that operating earnings for the third quarter were $533 million, or $1.10 per share compared to $496 million or $1.02 per share recorded last year, an $0.08 per share improvement. For the year-to-date period, our operating earnings were $1.277 billion, or $2.63 per share versus last year's results of $1.255 billion or $2.59 per share, an improvement of $0.04 per share. Stepping through the detail from the top to bottom, you can see that the quarter was adversely affected by a combination of certain Ohio transition items that were unfavorable, $0.03 per share versus last year. This effect on earnings was driven by an increase in customer switching, net of the capacity deferrals and lower capacity payments from competitive retail energy suppliers. On a year-to-date basis, this item represented a significant drag to earnings for an unfavorable comparison of $0.24 per share. As expected in our guidance, the effective income tax rate was unfavorable $0.04 per share for the quarter due to unfavorable year-on-year tax to book differences, accounted for on a flow-through basis, as well as positive adjustments to state income tax returns that were recorded in 2012. For the year-to-date, this item is now unfavorable $0.09 per share for the same reasons as for the quarter. Allowance for funds used during construction or AFUDC was off $0.02 per share for the third quarter and $0.07 per share for the year-to-date, due primarily to the startup of the Turk plant in December of 2012. Off-System Sales margins, net of sharing, were down $0.02 per share for the quarter. This decline was largely driven by prior period true-ups of PJM-related expenses that more than offset the effect of increased volumes and prices this year. For the year-to-date, Off-System Sales compared unfavorably to last year by $0.04 per share. The decline for this period was driven by lower RPM capacity revenues that hurt results by $0.03 per share, as well as the PJM-expense items mentioned for the quarter. As you can see, both AEP River Operations and our regulated retail load were unchanged and not drivers for the quarterly results. The September year-to-date decline for River Operations reflects the lingering impact of drought conditions from the back half of last year into the first half of this year. The year-to-date decline in regulated retail load is driven by the lower industrial demand across much of our service territories. As will become clear later in the presentation, the decrease in retail margins is not as large as the decrease in retail load. I will further discuss the economy and our Retail Sales data in the upcoming slides. Weather played an unfavorable role in our earnings comparison for the quarter. Temperatures were milder than last summer, adversely affecting results by $0.08 per share. This result for the quarter was more than offset by the favorable cushion that we had built up through June. Weather for the year-to-date period is now $0.02 per share favorable versus normal. O&M expense, net of offset items, was favorable $0.06 per share for the quarter, and that brings our year-to-date results almost even to last year. The lower O&M expense for the quarter was driven by lower storm and employee-related expenses, partially offset by higher transmission service expenses. Transmission operations added $0.01 per share for the quarter and $0.05 per share for the year-to-date period, reflecting our continuous significant investment in this area. Other items for the quarterly comparison were favorable by $0.05 per share. And for the year-to-date period, positive $0.09 per share. The improvement for both periods was driven by lower long-term interest expense, lower depreciation expenses and an increase in third-party transmission revenues. Finally, rate changes were favorable by $0.15 per share for the third quarter. This result pushes our favorable year-to-date comparison to $0.36 per share. The improvement in earnings in both periods reflect successful regulatory outcomes in multiple jurisdictions. As you can see, we continue to overcome the challenges created by Ohio. In spite of these challenges, we have executed on our plan to invest in our regulated operations, grow our transmission business and control expenses. Our year-to-date results and expectations for the fourth quarter allow us to narrow our operating earnings guidance for the year to the upper half of the previously stated range of $3.05 per share to $3.25 per share. We are narrowing guidance for 2013 to $3.15 to $3.25 per share, as Nick stated earlier. Also, as I mentioned earlier, I want to spend some time looking at our regulated load so far this year. Turning to Slide 6, you can see in the lower right quadrant that weather-normalized load was down 1.5% for the quarter and 1.9% for the year. This marks the fifth consecutive quarter of decline in Retail Sales. You've probably already noticed from looking at the bottom half of the slide, that the decline in Retail Sales is primarily driven by industrial sales. Residential sales, shown in the upper left quadrant, were down 1.8% for the quarter, which offset the strong first quarter results, bringing the year-to-date growth essentially flat. We continue to see modest customer growth of 0.7% in our Western service territories, but none to speak of in East. Average uses per customer has declined, as more customers are utilizing efficient appliances in their homes and taking advantage of various energy efficiency programs. In the upper right quadrant, you can see that commercial sales were up 1.3% for the quarter, which offset the weak second quarter results, making the year-to-date growth essentially flat. Commercial growth in the third quarter was evenly spread across the AEP service territory. In total, year-to-date commercial sales are down compared to last year. However, in Texas and Ohio, where we've seen stronger employment growth, we are seeing commercial sales gains compared to last year. Finally, in the lower left quadrant, you see the declines I mentioned earlier, where the industrial class is down 3.9% for the quarter and 5.1% for the year. If you exclude the effect of our largest customer, which had been operating at reduced levels, the declines would have been 1.3% and 2.7% for the quarter and year-to-date periods, respectively. While not minimizing the importance of these declines, it's important to note that the effect on gross margin associated with industrial declines is less than in other customer classes. The average realization from industrial customers is less than half that for residential. As I've done previously, let me stop here and share an update on the economy within AEP's footprint. AEP's service territory continues to experience economic growth, although the growth has slowed somewhat recently, as we are starting to see the impact of the federal fiscal austerity measures. This is particularly true on our Western footprint, where there are a number of military bases and a higher percentage of federal government employees than in our Eastern territory. As you know, a large part of the sequestration cuts were targeted around defense spending. Therefore, it is not surprising that for the quarter, GDP growth in AEP's Western footprint was a mere 0.1% compared to 0.8% in our Eastern territory and an estimated 1.4% for the U.S. Fortunately, the employment statistics, which are a better indicator of electricity sales and GDP, are not as weak. Job growth in AEP's Western footprint is up 1.6% and is in step with the U.S., which is at 1.7%, while growth in the East has moderated recently to 0.6%. Even though our employment growth had been consistently stronger than the U.S. over the past several years, the economy in AEP service territory is not fully recovered from the recession. Most of the employment growth over the last year has been in the service sector, which is consistent with our commercial sales class growth and has been the strongest in Texas and Ohio, as we mentioned earlier. Manufacturing employment, however, remains weak. With that segue, let's turn to Slide 7 where you'll see the quarterly results from our 5 largest industrial sectors. Our largest sector, primary metals, was down 18% from last year's third quarter. Earlier, I mentioned the curtailed production of our largest customer and excluding that effect, this sector would have been down closer to 8%. That customer has now fully ceased operations and so we expect to see this impact through the third quarter of next year. We are seeing other metals customers curtailing operations until market conditions improve and some are taking advantage of the situation to retool their operations. Chemical manufacturing is up 1.4% for the quarter, despite the year-to-date decline of 1.9%. If the global markets for chemicals recover, while natural gas prices remain low, this export industry is in position to experience recovery. Petroleum and coal products are down 2.1% for the quarter versus the same period last year. This is due to a couple of specific refineries that were down for maintenance in the third quarter. Excluding these 2 customers, sales to this sector were flat for the quarter and would have been up 2.3% for the year. The mining sector, excluding oil and gas, was down 2% for the quarter. This continuing decline reflects the impact of recent mild winters, low natural gas prices and weak demand from utilities and metals producers. Approximately 90% of AEP mining load is located in our Eastern footprint. Paper manufacturing was up 2.8% for the quarter, driven by higher demand in Ohio, which more than offset lower demand in the West. Although not in our top 5 sectors, we continue to see growing sales in the oil and gas extraction and pipeline transportation sectors, driven by continued gains related to shale gas activity. Turning to Slide 8 will give us an opportunity to review the financial health of the company. Our debt to total capitalization continues to improve and now stands at 54.4%. Our credit metrics, FFO interest coverage and FFO to total debt are solidly BBB and Baa2 at 4.6x and 19.7%, respectively. On the bottom left-hand side of the graph, you will see that our qualified pension liability funding has increased to 98%. The company has aggressively funded this liability over the last 3 years to the benefit of our employees, retirees, shareholders and bondholders. In addition to the funding, the company has been working hard to match the duration of the assets to the liabilities and to de-risk the plan as it approaches full funding. In addition to the pension results, our other post-employment benefit liability is now more than fully funded at 104.3%. This is due to some changes that were made last year in our post-retirement medical plans. Finally, let me give you some updates on some recent financing activity. Last week, AEP Transmission Company, LLC, priced commitments for $400 million of senior unsecured notes in maturities ranging from 5 to 30 years. This company is the holding company for the transcos that are in our existing service territories and seek to add incremental transmission investment for the benefit of our customers at federally regulated rates. The offering was a fantastic success, with spreads comparable to our larger rated utility companies, and in some cases, even lower than current indications, demonstrating the strong appetite of investors for transmission-specific debt. More than half of the $400 million offering was for 30-year maturities, including some delayed draws. Many thanks to our investors and to those who believed that this business format would attract significant amounts of well-priced capital. It is working out just as we said it would. Lastly, on September 20, we received a financing order from the West Virginia Public Service Commission, authorizing the securitization of the ENEC balance of $376 million plus financing costs. We anticipate securitizing this balance in the next few weeks as we work to finalize the offering. It should be clear from the improving metrics on this page that management is committed to a strong balance sheet and to our investment-grade credit rating. We will continue to demonstrate spending discipline, careful capital allocation and thoughtful access to the debt capital markets. Finally, let me preview some of the detail that we will be sharing next month at the EEI Fall Financial Conference. We will provide support for the company's 4% to 6% operating earnings growth rate, off of original 2013 guidance. We will show how the growth comes from putting capital to work for the benefit of our customers and then doing the hard work of getting the increased investment appropriately reflected in rates. We will provide detail on the continuous improvement plans that the company has embarked on. We will share the initiatives we have committed to for 2013 and describe the level of success we have had with those initiatives. We will also discuss the plans we have for 2014 and what we think the magnitude of those opportunities are. This should provide some insight into how we plan to fill the earnings gap presented by the low RPM auction results. We have found a framework for continuous improvement that has worked well for us for over a year now. We evaluate the size of the opportunity and then look to our employees to generate and analyze the ideas to capture the value. The employees who do the work of this company have the experience and skill to show us how to provide better service and how to do it more efficiently. We will provide more detail on the range of investment opportunity available to our transcos and transmission JVs. In the recent past, we have only shown the investment opportunity of approved projects or those that do not need additional approvals. In November, we will provide more detail about those projects as well as an upside case, which includes currently identified opportunities. This should give investors transparency into the growth potential of our transmission transcos and JVs. We will also provide more detail into the cost structure and earnings opportunity of AEP generation resources, our competitive generation affiliate. This will be a relatively small portion of our business going forward, but one that has generated a lot of interest by investors. Finally, we will provide some insights into the growth opportunity created by investment on behalf of our customers in our regulated wires and integrated utility companies. These regulated businesses will be the lion's share of AEP's business going forward and we will show how putting capital to work to benefit our customers will allow us to grow earnings over time. In November, we will be providing a lot of information, designed to provide insight, transparency and credibility to our investment and growth goals. At this time, we do not have plans to make any strategic announcements at the Fall EEI Conference, but rather details on how we plan to grow the company over time. With that, I will turn the call over to the operator for your questions.

[Operator Instructions] First question today comes from the line of Greg Gordon with ISI Group. Greg Gordon - ISI Group Inc., Research Division: A couple of questions. Thanks for so much detail on your perspective on sales growth. When you look at -- for planning purposes, when you look out over the next 12 to 24 months, and you normalize for a lot of the idiosyncrasies and what's going on in your service territory, what are sort of the range of expectations for sort of best case, worst case, base case sales growth going forward? Nicholas K. Akins: Greg, we've been assuming that load growth would be relatively flat. And that's what we're assuming in our modeling because you can't ignore what's going on with the economy. You can't -- and really, it's hard to tell what impact it would have in the future. And everybody's expecting -- you talk to economists and every quarter it seems like the next quarter we're going to see an economic recovery. Well, that's been going on for years. So we're being deliberately conservative on that. And we'll continue to be that way. Greg Gordon - ISI Group Inc., Research Division: Okay, Nick, that's great. So your plans to drive the 4% to 6% earnings growth aspiration are sort of anchored in the assumption that you're going to have to plow through a relatively flat sales growth picture? Nicholas K. Akins: Yes. I'd say it really is flat, flat load growth. It's on certainly cost containment through the efficiency efforts that we have ongoing and capital allocation. Those are the areas where we can get more concurrent growth and better ROEs. Greg Gordon - ISI Group Inc., Research Division: And Nick, on the earnings growth aspiration, is there a specific end date to that? Or is your goal at EEI going to be to show people that you don't just have the ability to grow at that rate through '15, but that you have the ability to offset sort of post-'15 headwinds and continue to grow at that rate? Nicholas K. Akins: Yes, you got it. It's -- we'll show that, based upon that original 2013 guidance range that we gave and if you look at that, the bottom line 4%, the top line 6%, we'll be in that range. Greg Gordon - ISI Group Inc., Research Division: Okay. Final question. The pension funding looks amazing. We've got a tax and accounting team here that's done some analysis here at ISI on the impact of higher discount rates on all the companies in the S&P 500. And utilities in particular, given their large pension, seem to be particularly large beneficiaries of that going into 2014. As you look at your planning, is it -- should it be our expectation that your pension -- GAAP pension expenses should decline dramatically next year? Or are you going to do things like take down the expected return because you're now so well-funded, which would mitigate the impact of that decline? Nicholas K. Akins: Go ahead, Brian. Brian X. Tierney: Greg, it's Brian. So we have, over time, been derisking our pension portfolio, shifting more of the assets into fixed income and away from equities as we become more fully funded. We're anticipating that in a step-down basis, our pension costs will start to approach our annual draw on the pension, which will be close to about $100 million. So next year, we anticipate it will be close to $125 million and then we expect the expense over time will approximate that $100 million per year level. Greg Gordon - ISI Group Inc., Research Division: And what was your pension expense budgeted for this year? Brian X. Tierney: We're anticipating it to be closer to $200 million, about $175 million, $180 million.

And we do have a question from the line of Dan Eggers with Crédit Suisse. Dan Eggers - Crédit Suisse AG, Research Division: Just on the load reg questions Greg was asking, I guess, if we were to draw it out and you think about the breakdown in customer growth on a more durable basis, do you think the commercial side continues to show momentum and the laggards are going to be industrial, residential? Or how do you think within a flat load growth profile do you see the customer classes behaving? Nicholas K. Akins: That's a great question. We see all 3 classes continuing to oscillate. And there's a lot of discussion to whether just the general nature of the American economy moving to an industrial manufacturing to more of a service economy. That would bode well for the commercial side of things. On the other hand, you want some fundamental base of industrial and manufacturing to enable the sustaining nature of commercial and ultimately, residential growth. But to us, I think, I guess, the beauty of AEP is that we're in so many areas of the country. And as Brian talked about, different parts of the country are experiencing different types of growth. And based on that diversity and the diversity of the margins related to the components of the classes of customers, I think we're probably in pretty good stead to remain, at least from the overall perspective, being relatively flat going forward. It would -- when you look at the components of the economy, though, in our service territory with the shale gas activity, with the energy-related economy that we have in place, if we really start to see consumption pick up by a vibrant economy, and there's more focus on the energy infrastructure and the energy resources of this country, it's going to bode well for our service territory. So you could see, I mean, you could see those kinds of measures pick up. But like I said earlier, that's all conjecture on all of our parts at this point in time. I think it's going to take more of a federal and state policy and regulatory policy that supports that kind of thing. And also, with the tax issues and things that need to be worked out by the federal government, you're not -- I mean, you won't see much growth until we see some clarity around how to invest in this country. And when you see that, I think you'll see a different makeup of what we're dealing with from a load cycle perspective. But like I said, we've been very conservative about it. We'll continue to be conservative until we see indications otherwise. But when you look at the shale gas offsets, the chemical manufacturing sort of picking up a little bit, that's sort of an early indication that maybe something's happening here. But it's hard to tell. Dan Eggers - Crédit Suisse AG, Research Division: And Nick, just on the shale gas-related activity, how much of your industrial load is that today? And can you just give some color on how much that's been growing as an underlying class since it doesn't get broken out? Nicholas K. Akins: Yes. Brian's got the detail on that. Brian X. Tierney: I do. Let me get to the proper page here. And I'm having trouble finding it. So the pipeline and oil and gas extraction are smaller percentages. It's in the 3% to 5% of our total industrial load. But the pipeline transportation, in particular, grew at 26% for the quarter and then well into double digits for the year-to-date period. So although it's smaller portions of our industrial load, the growth in those areas has been spectacular. Nicholas K. Akins: And when you look at the Eagle Ford shale area, for example, there's a whole list of industrial and manufacturing facilities that are coming online in Texas. Now some of them have been delayed in terms of their startup, but you can see that kind of activity when you have a vibrant and shale gas play in operation. And you're now seeing Cline, and there's another shale gas operation now in West Texas that's picking up as well. Oil and gas activity is definitely a positive for the territory. And I think that's why you see some of the commercial activity in Ohio pick up as well, although the Utica Shale isn't as far along as the Eagle Ford shale yet. Brian X. Tierney: Let me give you some more detail on that, Dan. Oil and gas extraction is 3.8% of total industrial load. Pipeline transportation, our 10th largest sector, is 3.8% of industrial. And oil and gas extraction is up almost 27% relative to the pre-recession peak. And the pipeline transportation is up 16%, relative to the pre-recession peak. So some pretty significant gains there over the last couple of years.

And we do have a question from the line of Kit Konolige with BGC. Kit Konolige - BGC Partners, Inc., Research Division: So on the dividend increase, obviously, 2 increases within 3 quarters here, and I get a cumulative total of about 6.4% increase. What can we take away from this in terms of likely future growth in the dividend? And when should we expect dividend change announcements in the future? Nicholas K. Akins: Well, I probably can't comment on the dividend change in the future. But I can say, this is consistent with what the board has laid out for us in terms of the expected range, the payout ratio, the 60% to 70%. And they've also said that our dividend payout will be commensurate with the earnings capability of the company. So those things, as long as it continues to play the way it is, then we should be in good shape. Kit Konolige - BGC Partners, Inc., Research Division: And how about -- so -- and Nick, you can't tell us anything about should we expect dividend increases in the first quarter as previously, going back to that pattern? Or will it just be uncertain for a period of time? Nicholas K. Akins: Well, typically, we evaluate dividends in October. But like I said, we'll have to look at the situation at the time with our board and make that determination. But typically, it's October. Kit Konolige - BGC Partners, Inc., Research Division: Right. Fair enough. And one other area to touch on. Previously, you've had a slide where you show 2014 EPS range of $3.15 to $3.45, but I didn't see that in here. Are we just in a sort of quiet period for 2014 at this stage? Or how -- should we continue to think about 4% to 6% growth in 2014, off of the previous range for 2013? Nicholas K. Akins: We haven't changed '14. That guidance is still good.

And we do have a question from the line of Stephen Byrd with Morgan Stanley. Stephen Byrd - Morgan Stanley, Research Division: I wanted to follow-up on load growth. Apologies for the load growth questions, but you had mentioned that in your long-term guidance, you're assuming flat load growth. And we've seen some challenging quarters here in terms of load growth. If load growth were to continue to trend negative, as it has been, how much of a headwind is that to your overall growth aspirations? Nicholas K. Akins: Yes, it just depends on the components of what the load decreases are. Because we have a lot more margin in not only commercial, but residential as well. So it will depend on the components of it. But I can tell you that if we continue to see load deterioration, then we believe we have the process in place to respond to that. And I keep saying, this business is about optimization now. And you got to remember, too, that I don't think load growth gives you the entire picture of the earnings capability of the company because we're having to reinvest in the grid. We're having to invest, not only from the distribution perspective, but also the transmission enhancements associated with it. And keep in mind, too, that we are producing earnings on the retail side beyond our own service territory. So typically, we've always looked at load because it was all like one integrated utility. And we had -- we only had the load increases and really, it's pretty measurable in terms of what the investment capability was. But we're sort of in a different picture now, where there would be more contributions from different areas. So -- but as that load changes, we'll obviously be watching the makeup of that load, the financial impact of the margin capability of that load and making adjustments accordingly. Brian X. Tierney: So to Nick's point, Stephen, some of the challenges that we've seen in industrial, so far, we know we're going to see, at least, through the third quarter of next year because of what's happened at that large primary metals customer. And to some degree, that will be offset by what we're seeing in chemicals, pipeline transportation, oil and gas extraction. But -- and this year, we've seen that we are down, overall load, 1.7% year-to-date, but it's only impacted earnings by $0.02 so far. So Nick's point that the combination of where we have load increases or declines makes a huge difference as to what our results will be. Nicholas K. Akins: Yes, and the large customer that shut down, even looking at that contract -- and it was a special contact, obviously. When you look at that kind of financial impact, it was still negligible and we continued with the earnings guidance that we provided. So I think you have to look at it, really, on a customer-by-customer basis and what type of customer they are. Stephen Byrd - Morgan Stanley, Research Division: Fair point. And a lot of your growth is in areas like transmission that, really, aren't -- isn't dependent on load growth outlook. Nicholas K. Akins: That's right. Stephen Byrd - Morgan Stanley, Research Division: I guess, just shifting over to the merchant side of the world, we've seen a more challenging gas environment. Gas space has been trending negative. As you think about the long-term merchant earnings outlook and think about the future, how does that factor in? Is that sort of in your current thinking, in terms -- like, it's moving so quickly. But just curious how you look at the headwinds in terms of the kind of the local gas price and the impact on power prices. Nicholas K. Akins: Yes, it absolutely is in our thinking. Gas prices have remained relatively low for a long period of time. And I still believe they're going to remain low for the foreseeable future. And it's something that we have to adjust to from an unregulated standpoint. And Chuck Zebula, who has taken over the generation, the unregulated generation side of the group with the retail piece of it, he is very focused on bringing down his cost structure to enable his business to continue to operate in a positive fashion. And you have -- I mean, there are several things you have to look at. One is, certainly, the natural gas picture. The other is the capacity markets themselves and the inability for those markets to actually pay long-term investors in an appropriate fashion. That's something that we are working on as well. And then also, the impact of distributed generation. Although it's pretty minimal in our territory, you think about those things. They're forcing functions for us to reform our business so that we can succeed in that kind of environment. And that's what we're focused on and our board is very focused on that as well.

And we do have a question from the line of Jonathan Arnold with Deutsche Bank. Jonathan P. Arnold - Deutsche Bank AG, Research Division: It's Jonathan Arnold. Well most -- a couple of things were already answered, but I just wanted to -- on Greg's question about how long your -- whether there's a definitive endpoint to your 4% to 6% growth aspiration? I wasn't sure you really addressed that piece of the question. Nicholas K. Akins: No, that's our long-term growth forecast, and it's as far as we can see at this point. Jonathan P. Arnold - Deutsche Bank AG, Research Division: Okay, great. And then secondly, just as you look at it -- assuming your load forecast of around 0 is the scenario you're dealing with, roughly how much of the 4% to 6% is coming from costs and continuous improvement and investment? Can you give us kind of a little preview of maybe some of these EEI buildups? Is it half from cost savings, half from growth investments or some other mix? Nicholas K. Akins: Well, we'll certainly have more detail on that in November. But we obviously are making pretty good headway from a continuous improvement and cost-reduction perspective. But you have to also think about rates that have been put into effect, the transmission investment and all kinds of things together. So I wouldn't look at one single area to determine what we're doing. So we'll certainly have more detail on that in November.

And we do have a question from the line of Paul Ridzon with KeyBanc. Paul T. Ridzon - KeyBanc Capital Markets Inc., Research Division: When did Ormet quit taking power and what's the strategy with Ohio as to potentially mitigate that? Nicholas K. Akins: Well, they shut down, I guess, completely just probably 2, 3 weeks ago. And right now, there is no plan. I mean, obviously, from an Ohio perspective, that was taken before the Ohio Commission. The Ohio Commission dealt with it in the best way that they could. I think it was a situation where the world markets had a tremendous impact on all of the primary metals suppliers. And that's really -- I think that's going to be the primary driver as to what can happen in the future, relative to those particular types of businesses. So at this point, we're continuing on as business as usual. Although, it's unfortunate that you wind up in a situation where so many jobs are impacted. But we have a lot of customers who have that kind of experience. And certainly, we did everything we could possibly do, from a special contract perspective and from other areas and working with the commission, to enable them to stay in business as long as possible. So I think we did everything we could do. The commission, in our belief, did everything that they could do. And I think it's a matter of the business case itself supporting that kind of business in the future. Paul T. Ridzon - KeyBanc Capital Markets Inc., Research Division: And can you just -- I don't know if you've already shut the door on this next question. What's your latest thinking about Ohio generation strategically? Nicholas K. Akins: Yes, I get that question a lot. From an Ohio generation perspective, we are still on path to -- our first course of action, obviously, is to complete corporate separation, to get that done. And then secondly, Chuck is busily working on what his cost structure's going to look like in the future to succeed. And even a $59 per megawatt day environment, we need to fully understand what that means. And also, we're pursuing changes within the PJM market construct to enable long-term investment decisions to be made. Those are prerequisites for us to determine what the nature of that business is and does it fit within our portfolio of companies. And I can't say, at this point, the timing of that. But certainly, I can tell you that our management, just like our investors, are fully engaged in trying to determine that result. And our board, obviously, is very focused on those types of issues as well. So it's not that we are sitting and waiting for corporate separation to complete before we start thinking about it. I can assure you that a lot of thought's being given, not only in terms of what milestones need to occur, but also, in terms of the information we need to make that kind of decision for the future.

And we do have a question from the line of Steve Fleishman with Wolfe Research. Steven I. Fleishman - Wolfe Research, LLC: Just on the topic of corporate separation, could you just clarify what are the remaining steps to get that done? Nicholas K. Akins: Yes. So we have the West Virginia case that we ultimately want to complete. And then there's 3 FERC-related cases that we intend on getting completed by the end of the year as well. And Brian, you know the details on those, there's... Brian X. Tierney: I don't -- we got half of the -- we filed for 6. There are 3 more that are left to be done and we don't have significant opposition in those. So we anticipate getting those shortly after we would be able to get what we need from West Virginia. Nicholas K. Akins: Yes, one's a pool agreement. The other's -- the operating agreement's in place. And then, there's an interim agreement that would be put in place as well. If you need more detail, Rich Munczinski is here, and he can describe those for you. Steven I. Fleishman - Wolfe Research, LLC: No, no, that's good. But you -- right now, it looks like those should all, potentially, be done by year end? Nicholas K. Akins: Yes, yes. 3 of them are already done and 3 to go in FERC and then, the corporate separation, yes. And then, you've also got the other side of the financing and everything that's going on, there's a lot of work going on associated with that activity as well. Steven I. Fleishman - Wolfe Research, LLC: Okay. Just a clarification from follow-up on the dividend. So you increased it another 2%. You had increase it 4% beginning of the year, the indicated rate. So that would be over 6%. But then, you're saying that this is a 4% increase for the year. I assume that's like the dividends paid? Nicholas K. Akins: Yes, that's right. Steven I. Fleishman - Wolfe Research, LLC: For this calendar year, up 4%? Nicholas K. Akins: That's right. Steven I. Fleishman - Wolfe Research, LLC: When we look forward to think about growth in the dividend, is it off this dividends paid in 2013 or the indicated rate? It's just a different way of looking at dividend growth than we normally look at, I think, so I'm just curious. Brian X. Tierney: So it's just math, Steve, as you know. So what we're trying to do is, as the board adjusted their stated dividend payout ratio to that 60% to 70%, we're trying to stay in that range. And I think you'll see us grow earnings with regulated earnings over time.

And we do have a question from the line of Anthony Crowdell with Jefferies. Anthony C. Crowdell - Jefferies LLC, Research Division: Just hopefully 2 quick questions. One is, I guess, I think you called it the equalizer slide, Slide 4, and you give a GAAP ROE. Is there any way of getting maybe a regulated ROE here? Because I think maybe there's some distortion where Texas may include some securitizations or I think you had -- you stated Off-System Sales in Ohio Power? And the second question is related to, I guess, the aluminum sector or primarily metal manufacturing, where Brian said some of the manufacturers are using this opportunity to retool their plants. With the retooling, do you think that makes them competitive in the current environment and we get back to a pre-recession load or where do we sell back in it? Brian X. Tierney: So let me start with the second question first, Anthony. So for instance, some of the things that we've seen some people do, in terms of retooling, we have one customer who's taking down 3 boilers that they had and are replacing it with a more -- a single, more efficient boiler. So in that case, they're becoming more efficient and we don't expect the load to come back to the pre-recession load. In other instances, people are saying, "Hey, prices aren't high enough here for us to continue operating at the levels that we were. We're going to take the plant down. We're going to do preventive maintenance and get the plant back online at a time when aluminum prices recover." So it's really a combination of both of those things. Some of it is efficiency and the load will be reduced when it comes back, and others just taking opportunistic outages. Nicholas K. Akins: The interesting thing is -- we're seeing is for the customers that obviously are still connected to the system that haven't gone out of business, those are still the demand charges, the demand ratchet that's in place for the industrial customers has not diminished. So that's a positive in terms of -- it's sort of an indication of where they are at this point in time. Brian X. Tierney: And the equalizer? Nicholas K. Akins: Yes, the equalizer graph. Brian X. Tierney: So yes, Anthony, we can definitely get for you the GAAP ROEs that are represented there. But you are correct. In a place like Texas, we're having the effects of the securitization. And absent that, the regulated wires return in Texas is much closer to 10%. So we can get you the detail on those for each of these, a GAAP return rather than the pro forma earned ROEs that we listed on the slide. And as Nick was saying about Ohio, if we had reflected the impact of the write-offs that we had, that 12.3% return that you see there in Ohio would be significantly lower than what we're showing there, much closer to 6%. Anthony C. Crowdell - Jefferies LLC, Research Division: So I guess, other than Ohio and Texas, I mean, the GAAP and regulated ROE are within the same ballpark. It's just those 2 outliers. Just because if you think about the company could keep managing costs, but one gets me where it is, "Hey, you can't really manage cost in Ohio or AEP Texas because you're already at 12%." Whereas, maybe the middle ground of this slide, I guess, with the exception of Oklahoma, you could manage cost. But I guess if there's a big difference between GAAP and regulated, there is some nice opportunity there. Nicholas K. Akins: Yes, you got it. Brian X. Tierney: Those states, in particular, that you mentioned, Texas and Ohio, are outliers for the reasons that we discussed.

And we do have a question from Ali Agha with SunTrust. Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division: Just 2 quick questions. One, in the past, you guys had -- used to lay out for us, as it related to rate increases, how much of next year's rate increases were already in hand. So if you did the same for 2014, looking at the stuff that's already happened, how much of the planned rate increases for next year would you say are already in hand right now? Brian X. Tierney: We'll provide you more detail on that at EEI, Ali. For this year, for what we had anticipated getting, we have most of those increases in hand at this point. Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division: Okay, okay. Also... Nicholas K. Akins: And the magnitude is smaller, too, than it used to be. I mean, it used to be huge. Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division: Right. Yes. And then, on Ohio customer switching, can you remind us, at the end of the September quarter, what the switching level was? Nicholas K. Akins: Yes, we're about 58% switched. Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division: Sorry? Nicholas K. Akins: 58%, which is about in line with our targets. Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division: Okay. And then on the growth rate, just to be clear, not to be a little nitpicky here, but the 4% to 6%, as you mentioned a couple of times, off your original '13 guidance, the fact that your original '13 guidance has now gone up if you just focus on the midpoint, so when '13 is an actual number, presumably higher than what it was previously thought to be, would you stick to the guidance of the actual '13 number or would you keep coming back to the original guidance? Nicholas K. Akins: We're going to keep coming back to the original guidance. Ali Agha - SunTrust Robinson Humphrey, Inc., Research Division: Okay. So the implication would be made that if '13 ends up higher, mathematically, the growth rate slightly comes lower than that. Is that the way to think about it? Nicholas K. Akins: Well, actually, it's 4% to 6% from the original 2013 guidance. And there's a bandwidth there and we'll be operating within that bandwidth.

And we do have a question from the line of Paul Patterson with Glenrock Associates. Paul Patterson - Glenrock Associates LLC: I want to ask you about the Texas case and the write-off that we got there. Is that -- it sounded to me that you guys were hoping to have that revised somewhat in your favor. Does the write-off reflect any change in that? Or can you just elaborate a little bit on that? Nicholas K. Akins: Yes. We got a little bit surprised because the commission, near the end of the entire case, we had a cap put in place that was originally our estimate of the cost of construction that did not include AFUDC. And during the whole pendency of that case, there was never an indication that the cost financing rate or AFUDC would be included in that cap. And the commission, at the previous commission hearing, they indicated that AFUDC was included in that and that's where it surprised us -- surprised everyone, I think. And then they issued an order saying that it was included. And so the write-off is commensurate with the obvious recognition that if the cap is truly inclusive of that AFUDC cost, then that precipitates a write-off from our perspective. So we did that. We're going to ask -- we're going to file for a rehearing and show, I think, a pretty credible case, that it never, never was discussed. And something that, through the entire case, there is no record of our ability to respond to that kind of component being included in the cost cap. So I think it's a pretty serious issue for the Texas Commission to take up, particularly when you have a power plant that is the first of its kind. It's probably -- out of the large projects that have occurred, it's been definitely the closest to budget. It's been lower than what we anticipated from an efficiency standpoint, which enures to the benefit of customers on a fuel cost perspective. And it's won 2 power plant awards and we won the Edison Electric award for that plant as well. And so to have that kind of positive investment that's made and it's found to be prudent, and to have a substantial amount of the cost of the plant essentially be disallowed, is not a good message for those that -- who are thinking about building capacity in the state of Texas. So... Paul Patterson - Glenrock Associates LLC: Sure. I hear you on all that, and it all makes sense. But I guess what I'm wondering is, the write-off, though, doesn't reflect any benefit from reconsideration or does it? Brian X. Tierney: It does not. Nicholas K. Akins: No. It assumes... Brian X. Tierney: We have an order from the commission that does not allow for the recovery of the AFUDC now, and we'll go for a rehearing. If we get a positive outcome from rehearing, then we'll adjust accordingly. But right now, we can't assume anything for... Nicholas K. Akins: There's just no basis for that recognition. Paul Patterson - Glenrock Associates LLC: And then, for depreciation, the benefit that you guys got from that in the last couple of quarters, can you remind me what that was? Brian X. Tierney: The benefit from? Paul Patterson - Glenrock Associates LLC: From lower depreciation. What's causing that? What's driving it? Brian X. Tierney: It's the Ohio write-offs that we discussed earlier. Okay. I think -- after this, I think we have time for one more question.

And we do have a question from the line of Michael Lapides with Goldman Sachs. Michael J. Lapides - Goldman Sachs Group Inc., Research Division: Brian, I want to make sure I understood your commentary about pension costs for the income statement purposes. If I interpreted it correctly, and I may have totally missed it, you're basically implying that it's a $100 million tailwind for 2014 versus what you had expected for 2013? Brian X. Tierney: Pension cost, pension expense will be about between $70 million -- it will be about a $50 million improvement, '13 to '14. Michael J. Lapides - Goldman Sachs Group Inc., Research Division: Okay, meaning, a reduction in the O&M expense that, that pension drives? Brian X. Tierney: Yes. Now let me be clear, that's total pension cost. That doesn't include the amount that's allocated for CapEx versus O&M. Michael J. Lapides - Goldman Sachs Group Inc., Research Division: Understood, completely understood. Also, I want to make sure we think about it, on the asset transfer dockets, both the Kentucky approval and the West Virginia, can you talk a little bit about the bottom line kind of what drops to the bottom line? I know you got the $44 million surcharge, but I'm just trying to think about what the cost offsets to that would be and kind of trying to do the same thing on the West Virginia side? Brian X. Tierney: On West Virginia, we don't have an answer yet. Nicholas K. Akins: Yes, but Off-System Sales, obviously, because that's not included. So that offsets some sale impact and I guess... Brian X. Tierney: And then the capacity settlement, we get to keep as we had previously. So the capacity payments that were in rates that Kentucky used to make to Ohio Power remain in effect during the period of the freeze. So it's the plus $44 million, keep the capacity payments and you keep the upside of Off-System Sales until we go back in for the next rate case. Michael J. Lapides - Goldman Sachs Group Inc., Research Division: And how much is the capacity payment in Kentucky? Brian X. Tierney: About $20 million. Nicholas K. Akins: $20 million. Michael J. Lapides - Goldman Sachs Group Inc., Research Division: Okay. And then when I think about the West Virginia request, just the request -- I know you don't have any answer. Can you give kind of similar details about the bottom line impact on kind of the items that would drop bottom line impact there? Brian X. Tierney: It's a little complicated at this point because of the Mitchell component that is up in the air. But we would not anticipate a significant difference versus where we are today. But that will be the significant component of what the settlements are, particularly, in regards to how we handle the Mitchell assets in regard to the Wheeling merger in the APCo.

Thank you for joining us on today's call. And as always, the IR team will be available to answer any additional questions you may have. So Brad, can you please give the replay information?

Of course. Ladies and gentlemen, today's conference will be available for replay after 11:00 a.m. today through October 30. You may access the AT&T TeleConference replay system at any time by dialing 1 (800) 475-6701, entering the access code 304411. International participants may dial (320) 365-3844. That does conclude your conference for today. Thank you for your participation and for using the AT&T Executive TeleConference Service. You may disconnect.