

	Volume
	June 30, 2014		December 31, 2013		Unit of Measure
Primary Risk Exposure	(in millions)
Commodity:
Power	430		406		MWhs
Coal	3		4		Tons
Natural Gas	116		127		MMBtus
Heating Oil and Gasoline	5		6		Gallons
Interest Rate	$	176	$	191	USD

Interest Rate and Foreign Currency	$	819	$	820	USD

Amount of Gain Loss Recognized on Risk Management Contracts

June 30, 2014



	Risk Management Contracts		Hedging Contracts					Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in millions)
Current Risk Management Assets	$	454	$	28	$	4		$	486	$	(340	)	$	146
Long-term Risk Management Assets	314		5		—			319		(95		)	224
Total Assets	768		33		4			805		(435		)	370

Current Risk Management Liabilities	372		20		1			393		(333		)	60
Long-term Risk Management Liabilities	182		2		10			194		(79		)	115
Total Liabilities	554		22		11			587		(412		)	175

Total MTM Derivative Contract Net Assets (Liabilities)	$	214	$	11	$	(7	)	$	218	$	(23	)	$	195

Fair Value of Derivative Instruments
December 31, 2013

	Risk Management Contracts		Hedging Contracts					Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in millions)
Current Risk Management Assets	$	347	$	12	$	4		$	363	$	(203	)	$	160
Long-term Risk Management Assets	368		3		—			371		(74		)	297
Total Assets	715		15		4			734		(277		)	457

Current Risk Management Liabilities	292		11		1			304		(214		)	90
Long-term Risk Management Liabilities	237		3		15			255		(78		)	177
Total Liabilities	529		14		16			559		(292		)	267

Total MTM Derivative Contract Net Assets (Liabilities)	$	186	$	1	$	(12	)	$	175	$	15		$	190


(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 primarily 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.


(c)	There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the statement of financial position.

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three and Six Months Ended June 30, 2014 and 2013



	Three Months Ended June 30,					Six Months Ended June 30,
Location of Gain (Loss)	2014		2013			2014		2013
	(in millions)
Vertically Integrated Utilities Revenues	$	4	$	4		$	22	$	10
Generation & Marketing Revenues	16		17			48		33
Regulatory Assets (a)	—		(8		)	—		(6		)
Regulatory Liabilities (a)	29		4			118		(2		)
Total Gain on Risk Management Contracts	$	49	$	17		$	188	$	35


(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 Condensed Balance Sheet

June 30, 2014



	Commodity		Interest Rate and Foreign Currency			Total
	(in millions)
Hedging Assets (a)	$	15	$	—		$	15
Hedging Liabilities (a)	4		2			6
AOCI Gain (Loss) Net of Tax	6		(21		)	(15		)
Portion Expected to be Reclassified to Net Income During the Next Twelve Months	4		(3		)	1

Impact of Cash Flow Hedges on the Condensed Balance Sheet
December 31, 2013

	Commodity		Interest Rate and Foreign Currency			Total
	(in millions)
Hedging Assets (a)	$	7	$	—		$	7
Hedging Liabilities (a)	6		2			8
AOCI Loss Net of Tax	—		(23		)	(23		)
Portion Expected to be Reclassified to Net Income During the Next Twelve Months	—		(4		)	(4		)


(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, 2014		December 31, 2013
	(in millions)
Liabilities for Derivative Contracts with Credit Downgrade Triggers	$	1	$	3
Amount of Collateral AEP Subsidiaries Would Have Been Required to Post	167		33
Amount Attributable to RTO and ISO Activities	54		28



	June 30, 2014		December 31, 2013
	(in millions)
Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements	$	201	$	293
Amount of Cash Collateral Posted	—		1
Additional Settlement Liability if Cross Default Provision is Triggered	141		235

Appalachian Power Co [Member]

June 30, 2014



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	67,059		48,352		32,686		14,744		18,668
Coal	Tons	465		1,778		—		500		917
Natural Gas	MMBtus	1,540		1,030		—		68		87
Heating Oil and Gasoline	Gallons	891		427		907		502		572
Interest Rate	USD	$	8,041	$	5,454	$	—	$	—	$	—

Notional Volume of Derivative Instruments

December 31, 2013



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	48,995		33,231		34,843		13,469		17,057
Coal	Tons	31		3,389		—		1,013		1,692
Natural Gas	MMBtus	2,477		1,680		—		—		—
Heating Oil and Gasoline	Gallons	1,089		521		1,108		614		699
Interest Rate	USD	$	12,720	$	8,627	$	—	$	—	$	—



	June 30, 2014				December 31, 2013
Company	Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities		Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities
	(in thousands)
APCo	$	1,356	$	137	$	—	$	2,993
I&M	894		333		—		2,030
OPCo	145		—		—		—
PSO	72		—		—		1
SWEPCo	83		—		—		3

Amount of Gain Loss Recognized on Risk Management Contracts

APCo

Fair Value of Derivative Instruments

June 30, 2014



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	38,369	$	—	$	—	$	38,369	$	(13,550	)	$	24,819
Long-term Risk Management Assets	10,305		—		—		10,305		(2,195		)	8,110
Total Assets	48,674		—		—		48,674		(15,745		)	32,929

Current Risk Management Liabilities	16,948		—		—		16,948		(12,722		)	4,226
Long-term Risk Management Liabilities	5,570		—		—		5,570		(1,804		)	3,766
Total Liabilities	22,518		—		—		22,518		(14,526		)	7,992

Total MTM Derivative Contract Net Assets (Liabilities)	$	26,156	$	—	$	—	$	26,156	$	(1,219	)	$	24,937

APCo

Fair Value of Derivative Instruments

December 31, 2013



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	46,431	$	389	$	—	$	46,820	$	(25,649	)	$	21,171
Long-term Risk Management Assets	20,948		—		—		20,948		(4,000		)	16,948
Total Assets	67,379		389		—		67,768		(29,649		)	38,119

Current Risk Management Liabilities	37,010		313		—		37,323		(28,431		)	8,892
Long-term Risk Management Liabilities	14,452		—		—		14,452		(4,211		)	10,241
Total Liabilities	51,462		313		—		51,775		(32,642		)	19,133

Total MTM Derivative Contract Net Assets (Liabilities)	$	15,917	$	76	$	—	$	15,993	$	2,993		$	18,986


(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."


(c)	There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the statement of financial position.

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	1,184	$	1,323		$	56	$	63		$	(79	)
Sales to AEP Affiliates	—		(300		)	—		300			—
Regulatory Assets (a)	—		—			—		(12		)	(16		)
Regulatory Liabilities (a)	13,718		8,793			6,404		(669		)	(1,019		)
Total Gain (Loss) on Risk Management Contracts	$	14,902	$	9,816		$	6,460	$	(318	)	$	(1,114	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	194		$	2,897		$	1,819		$	169		$	302
Regulatory Assets (a)	(974		)	(1,585		)	(4,492		)	192			(373		)
Regulatory Liabilities (a)	1,230			(880		)	3,360			(1		)	39
Total Gain (Loss) on Risk Management Contracts	$	450		$	432		$	687		$	360		$	(32	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	6,031	$	7,479		$	56	$	127		$	(56	)
Sales to AEP Affiliates	—		(521		)	—		521			—
Regulatory Assets (a)	4		—			—		(10		)	(13		)
Regulatory Liabilities (a)	46,050		27,110			41,503		(189		)	311
Total Gain on Risk Management Contracts	$	52,085	$	34,068		$	41,559	$	449		$	242

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO		SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	873		$	7,844		$	3,533		$	216	$	330
Regulatory Assets (a)	—			(1,099		)	(5,697		)	2,202		(102		)
Regulatory Liabilities (a)	(210		)	(6,062		)	3,360			—		135
Total Gain on Risk Management Contracts	$	663		$	683		$	1,196		$	2,418	$	363


(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 Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

June 30, 2014



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	—	$	—	$	—	$	—	$	—	$	3,596
I&M	—		—		—		—		—		(15,155		)
OPCo	—		—		—		—		—		6,288
PSO	—		—		—		—		—		5,322
SWEPCo	—		—		—		—		—		(12,169		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency			Maximum Term for Exposure to Variability of Future Cash Flows
	(in thousands)					(in months)
APCo	$	—	$	(431	)	0
I&M	—		(1,283		)	0
OPCo	—		1,372			0
PSO	—		759			0
SWEPCo	—		(2,267		)	0

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

December 31, 2013



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	363	$	—	$	287	$	—	$	94	$	3,090
I&M	216		—		194		—		46		(15,976		)
OPCo	162		—		—		—		105		6,974
PSO	84		—		—		—		57		5,701
SWEPCo	97		—		—		—		66		(13,304		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	94	$	(806	)
I&M	46		(1,568		)
OPCo	105		1,363
PSO	57		759
SWEPCo	66		(2,267		)


(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, 2014
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	140	$	3,096	$	3,023
I&M	95		2,096		2,051
OPCo	—		—		—
PSO	3		10,137		5,989
SWEPCo	3		7,729		7,585



	December 31, 2013
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	575	$	2,747	$	2,539
I&M	390		1,863		1,722
OPCo	349		—		—
PSO	—		2,930		410
SWEPCo	—		713		519



	June 30, 2014
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	10,809	$	—	$	7,909
I&M	7,328		—		5,362
OPCo	—		—		—
PSO	14		—		14
SWEPCo	18		—		18



	December 31, 2013
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	19,648	$	—	$	18,568
I&M	13,326		—		12,594
OPCo	—		—		—
PSO	3		—		3
SWEPCo	3		—		3

Indiana Michigan Power Co [Member]

June 30, 2014



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	67,059		48,352		32,686		14,744		18,668
Coal	Tons	465		1,778		—		500		917
Natural Gas	MMBtus	1,540		1,030		—		68		87
Heating Oil and Gasoline	Gallons	891		427		907		502		572
Interest Rate	USD	$	8,041	$	5,454	$	—	$	—	$	—

Notional Volume of Derivative Instruments

December 31, 2013



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	48,995		33,231		34,843		13,469		17,057
Coal	Tons	31		3,389		—		1,013		1,692
Natural Gas	MMBtus	2,477		1,680		—		—		—
Heating Oil and Gasoline	Gallons	1,089		521		1,108		614		699
Interest Rate	USD	$	12,720	$	8,627	$	—	$	—	$	—



	June 30, 2014				December 31, 2013
Company	Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities		Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities
	(in thousands)
APCo	$	1,356	$	137	$	—	$	2,993
I&M	894		333		—		2,030
OPCo	145		—		—		—
PSO	72		—		—		1
SWEPCo	83		—		—		3

Amount of Gain Loss Recognized on Risk Management Contracts

I&M

Fair Value of Derivative Instruments

June 30, 2014



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	27,932	$	—	$	—	$	27,932	$	(10,043	)	$	17,889
Long-term Risk Management Assets	6,894		—		—		6,894		(1,487		)	5,407
Total Assets	34,826		—		—		34,826		(11,530		)	23,296

Current Risk Management Liabilities	13,222		—		—		13,222		(9,745		)	3,477
Long-term Risk Management Liabilities	3,778		—		—		3,778		(1,224		)	2,554
Total Liabilities	17,000		—		—		17,000		(10,969		)	6,031

Total MTM Derivative Contract Net Assets (Liabilities)	$	17,826	$	—	$	—	$	17,826	$	(561	)	$	17,265

I&M

Fair Value of Derivative Instruments

December 31, 2013



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	33,229	$	234	$	—	$	33,463	$	(18,075	)	$	15,388
Long-term Risk Management Assets	14,208		—		—		14,208		(2,713		)	11,495
Total Assets	47,437		234		—		47,671		(20,788		)	26,883

Current Risk Management Liabilities	26,779		212		—		26,991		(19,962		)	7,029
Long-term Risk Management Liabilities	9,802		—		—		9,802		(2,856		)	6,946
Total Liabilities	36,581		212		—		36,793		(22,818		)	13,975

Total MTM Derivative Contract Net Assets (Liabilities)	$	10,856	$	22	$	—	$	10,878	$	2,030		$	12,908


(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."


(c)	There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the statement of financial position.

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	1,184	$	1,323		$	56	$	63		$	(79	)
Sales to AEP Affiliates	—		(300		)	—		300			—
Regulatory Assets (a)	—		—			—		(12		)	(16		)
Regulatory Liabilities (a)	13,718		8,793			6,404		(669		)	(1,019		)
Total Gain (Loss) on Risk Management Contracts	$	14,902	$	9,816		$	6,460	$	(318	)	$	(1,114	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	194		$	2,897		$	1,819		$	169		$	302
Regulatory Assets (a)	(974		)	(1,585		)	(4,492		)	192			(373		)
Regulatory Liabilities (a)	1,230			(880		)	3,360			(1		)	39
Total Gain (Loss) on Risk Management Contracts	$	450		$	432		$	687		$	360		$	(32	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	6,031	$	7,479		$	56	$	127		$	(56	)
Sales to AEP Affiliates	—		(521		)	—		521			—
Regulatory Assets (a)	4		—			—		(10		)	(13		)
Regulatory Liabilities (a)	46,050		27,110			41,503		(189		)	311
Total Gain on Risk Management Contracts	$	52,085	$	34,068		$	41,559	$	449		$	242

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO		SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	873		$	7,844		$	3,533		$	216	$	330
Regulatory Assets (a)	—			(1,099		)	(5,697		)	2,202		(102		)
Regulatory Liabilities (a)	(210		)	(6,062		)	3,360			—		135
Total Gain on Risk Management Contracts	$	663		$	683		$	1,196		$	2,418	$	363


(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 Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

June 30, 2014



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	—	$	—	$	—	$	—	$	—	$	3,596
I&M	—		—		—		—		—		(15,155		)
OPCo	—		—		—		—		—		6,288
PSO	—		—		—		—		—		5,322
SWEPCo	—		—		—		—		—		(12,169		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency			Maximum Term for Exposure to Variability of Future Cash Flows
	(in thousands)					(in months)
APCo	$	—	$	(431	)	0
I&M	—		(1,283		)	0
OPCo	—		1,372			0
PSO	—		759			0
SWEPCo	—		(2,267		)	0

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

December 31, 2013



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	363	$	—	$	287	$	—	$	94	$	3,090
I&M	216		—		194		—		46		(15,976		)
OPCo	162		—		—		—		105		6,974
PSO	84		—		—		—		57		5,701
SWEPCo	97		—		—		—		66		(13,304		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	94	$	(806	)
I&M	46		(1,568		)
OPCo	105		1,363
PSO	57		759
SWEPCo	66		(2,267		)


(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, 2014
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	140	$	3,096	$	3,023
I&M	95		2,096		2,051
OPCo	—		—		—
PSO	3		10,137		5,989
SWEPCo	3		7,729		7,585



	December 31, 2013
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	575	$	2,747	$	2,539
I&M	390		1,863		1,722
OPCo	349		—		—
PSO	—		2,930		410
SWEPCo	—		713		519



	June 30, 2014
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	10,809	$	—	$	7,909
I&M	7,328		—		5,362
OPCo	—		—		—
PSO	14		—		14
SWEPCo	18		—		18



	December 31, 2013
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	19,648	$	—	$	18,568
I&M	13,326		—		12,594
OPCo	—		—		—
PSO	3		—		3
SWEPCo	3		—		3

Ohio Power Co [Member]

June 30, 2014



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	67,059		48,352		32,686		14,744		18,668
Coal	Tons	465		1,778		—		500		917
Natural Gas	MMBtus	1,540		1,030		—		68		87
Heating Oil and Gasoline	Gallons	891		427		907		502		572
Interest Rate	USD	$	8,041	$	5,454	$	—	$	—	$	—

Notional Volume of Derivative Instruments

December 31, 2013



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	48,995		33,231		34,843		13,469		17,057
Coal	Tons	31		3,389		—		1,013		1,692
Natural Gas	MMBtus	2,477		1,680		—		—		—
Heating Oil and Gasoline	Gallons	1,089		521		1,108		614		699
Interest Rate	USD	$	12,720	$	8,627	$	—	$	—	$	—



	June 30, 2014				December 31, 2013
Company	Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities		Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities
	(in thousands)
APCo	$	1,356	$	137	$	—	$	2,993
I&M	894		333		—		2,030
OPCo	145		—		—		—
PSO	72		—		—		1
SWEPCo	83		—		—		3

Amount of Gain Loss Recognized on Risk Management Contracts

OPCo

Fair Value of Derivative Instruments

June 30, 2014



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	9,430	$	—	$	—	$	9,430	$	(131	)	$	9,299
Long-term Risk Management Assets	14		—		—		14		(14		)	—
Total Assets	9,444		—		—		9,444		(145		)	9,299

Current Risk Management Liabilities	—		—		—		—		—			—
Long-term Risk Management Liabilities	—		—		—		—		—			—
Total Liabilities	—		—		—		—		—			—

Total MTM Derivative Contract Net Assets (Liabilities)	$	9,444	$	—	$	—	$	9,444	$	(145	)	$	9,299

OPCo

Fair Value of Derivative Instruments

December 31, 2013



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	3,269	$	162	$	—	$	3,431	$	(349	)	$	3,082
Long-term Risk Management Assets	—		—		—		—		—			—
Total Assets	3,269		162		—		3,431		(349		)	3,082

Current Risk Management Liabilities	349		—		—		349		(349		)	—
Long-term Risk Management Liabilities	—		—		—		—		—			—
Total Liabilities	349		—		—		349		(349		)	—

Total MTM Derivative Contract Net Assets (Liabilities)	$	2,920	$	162	$	—	$	3,082	$	—		$	3,082


(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."


(c)	There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the statement of financial position.

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	1,184	$	1,323		$	56	$	63		$	(79	)
Sales to AEP Affiliates	—		(300		)	—		300			—
Regulatory Assets (a)	—		—			—		(12		)	(16		)
Regulatory Liabilities (a)	13,718		8,793			6,404		(669		)	(1,019		)
Total Gain (Loss) on Risk Management Contracts	$	14,902	$	9,816		$	6,460	$	(318	)	$	(1,114	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	194		$	2,897		$	1,819		$	169		$	302
Regulatory Assets (a)	(974		)	(1,585		)	(4,492		)	192			(373		)
Regulatory Liabilities (a)	1,230			(880		)	3,360			(1		)	39
Total Gain (Loss) on Risk Management Contracts	$	450		$	432		$	687		$	360		$	(32	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	6,031	$	7,479		$	56	$	127		$	(56	)
Sales to AEP Affiliates	—		(521		)	—		521			—
Regulatory Assets (a)	4		—			—		(10		)	(13		)
Regulatory Liabilities (a)	46,050		27,110			41,503		(189		)	311
Total Gain on Risk Management Contracts	$	52,085	$	34,068		$	41,559	$	449		$	242

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO		SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	873		$	7,844		$	3,533		$	216	$	330
Regulatory Assets (a)	—			(1,099		)	(5,697		)	2,202		(102		)
Regulatory Liabilities (a)	(210		)	(6,062		)	3,360			—		135
Total Gain on Risk Management Contracts	$	663		$	683		$	1,196		$	2,418	$	363


(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 Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

June 30, 2014



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	—	$	—	$	—	$	—	$	—	$	3,596
I&M	—		—		—		—		—		(15,155		)
OPCo	—		—		—		—		—		6,288
PSO	—		—		—		—		—		5,322
SWEPCo	—		—		—		—		—		(12,169		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency			Maximum Term for Exposure to Variability of Future Cash Flows
	(in thousands)					(in months)
APCo	$	—	$	(431	)	0
I&M	—		(1,283		)	0
OPCo	—		1,372			0
PSO	—		759			0
SWEPCo	—		(2,267		)	0

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

December 31, 2013



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	363	$	—	$	287	$	—	$	94	$	3,090
I&M	216		—		194		—		46		(15,976		)
OPCo	162		—		—		—		105		6,974
PSO	84		—		—		—		57		5,701
SWEPCo	97		—		—		—		66		(13,304		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	94	$	(806	)
I&M	46		(1,568		)
OPCo	105		1,363
PSO	57		759
SWEPCo	66		(2,267		)


(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, 2014
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	140	$	3,096	$	3,023
I&M	95		2,096		2,051
OPCo	—		—		—
PSO	3		10,137		5,989
SWEPCo	3		7,729		7,585



	December 31, 2013
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	575	$	2,747	$	2,539
I&M	390		1,863		1,722
OPCo	349		—		—
PSO	—		2,930		410
SWEPCo	—		713		519



	June 30, 2014
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	10,809	$	—	$	7,909
I&M	7,328		—		5,362
OPCo	—		—		—
PSO	14		—		14
SWEPCo	18		—		18



	December 31, 2013
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	19,648	$	—	$	18,568
I&M	13,326		—		12,594
OPCo	—		—		—
PSO	3		—		3
SWEPCo	3		—		3

Public Service Co Of Oklahoma [Member]

June 30, 2014



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	67,059		48,352		32,686		14,744		18,668
Coal	Tons	465		1,778		—		500		917
Natural Gas	MMBtus	1,540		1,030		—		68		87
Heating Oil and Gasoline	Gallons	891		427		907		502		572
Interest Rate	USD	$	8,041	$	5,454	$	—	$	—	$	—

Notional Volume of Derivative Instruments

December 31, 2013



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	48,995		33,231		34,843		13,469		17,057
Coal	Tons	31		3,389		—		1,013		1,692
Natural Gas	MMBtus	2,477		1,680		—		—		—
Heating Oil and Gasoline	Gallons	1,089		521		1,108		614		699
Interest Rate	USD	$	12,720	$	8,627	$	—	$	—	$	—



	June 30, 2014				December 31, 2013
Company	Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities		Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities
	(in thousands)
APCo	$	1,356	$	137	$	—	$	2,993
I&M	894		333		—		2,030
OPCo	145		—		—		—
PSO	72		—		—		1
SWEPCo	83		—		—		3

Amount of Gain Loss Recognized on Risk Management Contracts

PSO

Fair Value of Derivative Instruments

June 30, 2014



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	509	$	—	$	—	$	509	$	13		$	522
Long-term Risk Management Assets	8		—		—		8		(8		)	—
Total Assets	517		—		—		517		5			522

Current Risk Management Liabilities	25		—		—		25		77			102
Long-term Risk Management Liabilities	—		—		—		—		—			—
Total Liabilities	25		—		—		25		77			102

Total MTM Derivative Contract Net Assets (Liabilities)	$	492	$	—	$	—	$	492	$	(72	)	$	420

PSO

Fair Value of Derivative Instruments

December 31, 2013



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)		Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	1,078	$	84	$	—	$	1,162	$	5	$	1,167
Long-term Risk Management Assets	—		—		—		—		—		—
Total Assets	1,078		84		—		1,162		5		1,167

Current Risk Management Liabilities	81		—		—		81		4		85
Long-term Risk Management Liabilities	—		—		—		—		—		—
Total Liabilities	81		—		—		81		4		85

Total MTM Derivative Contract Net Assets (Liabilities)	$	997	$	84	$	—	$	1,081	$	1	$	1,082


(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."


(c)	There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the statement of financial position.

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	1,184	$	1,323		$	56	$	63		$	(79	)
Sales to AEP Affiliates	—		(300		)	—		300			—
Regulatory Assets (a)	—		—			—		(12		)	(16		)
Regulatory Liabilities (a)	13,718		8,793			6,404		(669		)	(1,019		)
Total Gain (Loss) on Risk Management Contracts	$	14,902	$	9,816		$	6,460	$	(318	)	$	(1,114	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	194		$	2,897		$	1,819		$	169		$	302
Regulatory Assets (a)	(974		)	(1,585		)	(4,492		)	192			(373		)
Regulatory Liabilities (a)	1,230			(880		)	3,360			(1		)	39
Total Gain (Loss) on Risk Management Contracts	$	450		$	432		$	687		$	360		$	(32	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	6,031	$	7,479		$	56	$	127		$	(56	)
Sales to AEP Affiliates	—		(521		)	—		521			—
Regulatory Assets (a)	4		—			—		(10		)	(13		)
Regulatory Liabilities (a)	46,050		27,110			41,503		(189		)	311
Total Gain on Risk Management Contracts	$	52,085	$	34,068		$	41,559	$	449		$	242

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO		SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	873		$	7,844		$	3,533		$	216	$	330
Regulatory Assets (a)	—			(1,099		)	(5,697		)	2,202		(102		)
Regulatory Liabilities (a)	(210		)	(6,062		)	3,360			—		135
Total Gain on Risk Management Contracts	$	663		$	683		$	1,196		$	2,418	$	363


(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 Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

June 30, 2014



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	—	$	—	$	—	$	—	$	—	$	3,596
I&M	—		—		—		—		—		(15,155		)
OPCo	—		—		—		—		—		6,288
PSO	—		—		—		—		—		5,322
SWEPCo	—		—		—		—		—		(12,169		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency			Maximum Term for Exposure to Variability of Future Cash Flows
	(in thousands)					(in months)
APCo	$	—	$	(431	)	0
I&M	—		(1,283		)	0
OPCo	—		1,372			0
PSO	—		759			0
SWEPCo	—		(2,267		)	0

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

December 31, 2013



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	363	$	—	$	287	$	—	$	94	$	3,090
I&M	216		—		194		—		46		(15,976		)
OPCo	162		—		—		—		105		6,974
PSO	84		—		—		—		57		5,701
SWEPCo	97		—		—		—		66		(13,304		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	94	$	(806	)
I&M	46		(1,568		)
OPCo	105		1,363
PSO	57		759
SWEPCo	66		(2,267		)


(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, 2014
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	140	$	3,096	$	3,023
I&M	95		2,096		2,051
OPCo	—		—		—
PSO	3		10,137		5,989
SWEPCo	3		7,729		7,585



	December 31, 2013
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	575	$	2,747	$	2,539
I&M	390		1,863		1,722
OPCo	349		—		—
PSO	—		2,930		410
SWEPCo	—		713		519



	June 30, 2014
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	10,809	$	—	$	7,909
I&M	7,328		—		5,362
OPCo	—		—		—
PSO	14		—		14
SWEPCo	18		—		18



	December 31, 2013
Company	Liabilities for Contracts with Cross Default Provisions Prior to Contractual Netting Arrangements		Amount of Cash Collateral Posted		Additional Settlement Liability if Cross Default Provision is Triggered
	(in thousands)
APCo	$	19,648	$	—	$	18,568
I&M	13,326		—		12,594
OPCo	—		—		—
PSO	3		—		3
SWEPCo	3		—		3

Southwestern Electric Power Co [Member]

June 30, 2014



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	67,059		48,352		32,686		14,744		18,668
Coal	Tons	465		1,778		—		500		917
Natural Gas	MMBtus	1,540		1,030		—		68		87
Heating Oil and Gasoline	Gallons	891		427		907		502		572
Interest Rate	USD	$	8,041	$	5,454	$	—	$	—	$	—

Notional Volume of Derivative Instruments

December 31, 2013



Primary Risk Exposure	Unit of Measure	APCo		I&M		OPCo		PSO		SWEPCo
		(in thousands)
Commodity:
Power	MWhs	48,995		33,231		34,843		13,469		17,057
Coal	Tons	31		3,389		—		1,013		1,692
Natural Gas	MMBtus	2,477		1,680		—		—		—
Heating Oil and Gasoline	Gallons	1,089		521		1,108		614		699
Interest Rate	USD	$	12,720	$	8,627	$	—	$	—	$	—



	June 30, 2014				December 31, 2013
Company	Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities		Cash Collateral Received Netted Against Risk Management Assets		Cash Collateral Paid Netted Against Risk Management Liabilities
	(in thousands)
APCo	$	1,356	$	137	$	—	$	2,993
I&M	894		333		—		2,030
OPCo	145		—		—		—
PSO	72		—		—		1
SWEPCo	83		—		—		3

Amount of Gain Loss Recognized on Risk Management Contracts

SWEPCo

Fair Value of Derivative Instruments

June 30, 2014



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	596	$	—	$	—	$	596	$	(90	)	$	506
Long-term Risk Management Assets	9		—		—		9		(9		)	—
Total Assets	605		—		—		605		(99		)	506

Current Risk Management Liabilities	33		—		—		33		(16		)	17
Long-term Risk Management Liabilities	—		—		—		—		—			—
Total Liabilities	33		—		—		33		(16		)	17

Total MTM Derivative Contract Net Assets (Liabilities)	$	572	$	—	$	—	$	572	$	(83	)	$	489

SWEPCo

Fair Value of Derivative Instruments

December 31, 2013



	Risk Management Contracts		Hedging Contracts				Gross Amounts of Risk Management Assets/ Liabilities Recognized		Gross Amounts Offset in the Statement of Financial Position (b)			Net Amounts of Assets/Liabilities Presented in the Statement of Financial Position (c)
Balance Sheet Location	Commodity (a)		Commodity (a)		Interest Rate and Foreign Currency (a)
	(in thousands)
Current Risk Management Assets	$	1,233	$	97	$	—	$	1,330	$	(151	)	$	1,179
Long-term Risk Management Assets	—		—		—		—		—			—
Total Assets	1,233		97		—		1,330		(151		)	1,179

Current Risk Management Liabilities	154		—		—		154		(154		)	—
Long-term Risk Management Liabilities	—		—		—		—		—			—
Total Liabilities	154		—		—		154		(154		)	—

Total MTM Derivative Contract Net Assets (Liabilities)	$	1,079	$	97	$	—	$	1,176	$	3		$	1,179


(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."


(c)	There are no derivative contracts subject to a master netting arrangement or similar agreement which are not offset in the statement of financial position.

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	1,184	$	1,323		$	56	$	63		$	(79	)
Sales to AEP Affiliates	—		(300		)	—		300			—
Regulatory Assets (a)	—		—			—		(12		)	(16		)
Regulatory Liabilities (a)	13,718		8,793			6,404		(669		)	(1,019		)
Total Gain (Loss) on Risk Management Contracts	$	14,902	$	9,816		$	6,460	$	(318	)	$	(1,114	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Three Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	194		$	2,897		$	1,819		$	169		$	302
Regulatory Assets (a)	(974		)	(1,585		)	(4,492		)	192			(373		)
Regulatory Liabilities (a)	1,230			(880		)	3,360			(1		)	39
Total Gain (Loss) on Risk Management Contracts	$	450		$	432		$	687		$	360		$	(32	)

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2014



Location of Gain (Loss)	APCo		I&M			OPCo		PSO			SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	6,031	$	7,479		$	56	$	127		$	(56	)
Sales to AEP Affiliates	—		(521		)	—		521			—
Regulatory Assets (a)	4		—			—		(10		)	(13		)
Regulatory Liabilities (a)	46,050		27,110			41,503		(189		)	311
Total Gain on Risk Management Contracts	$	52,085	$	34,068		$	41,559	$	449		$	242

Amount of Gain (Loss) Recognized on

Risk Management Contracts

For the Six Months Ended June 30, 2013



Location of Gain (Loss)	APCo			I&M			OPCo			PSO		SWEPCo
	(in thousands)
Electric Generation, Transmission and Distribution Revenues	$	873		$	7,844		$	3,533		$	216	$	330
Regulatory Assets (a)	—			(1,099		)	(5,697		)	2,202		(102		)
Regulatory Liabilities (a)	(210		)	(6,062		)	3,360			—		135
Total Gain on Risk Management Contracts	$	663		$	683		$	1,196		$	2,418	$	363


(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 Condensed Balance Sheet

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

June 30, 2014



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	—	$	—	$	—	$	—	$	—	$	3,596
I&M	—		—		—		—		—		(15,155		)
OPCo	—		—		—		—		—		6,288
PSO	—		—		—		—		—		5,322
SWEPCo	—		—		—		—		—		(12,169		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency			Maximum Term for Exposure to Variability of Future Cash Flows
	(in thousands)					(in months)
APCo	$	—	$	(431	)	0
I&M	—		(1,283		)	0
OPCo	—		1,372			0
PSO	—		759			0
SWEPCo	—		(2,267		)	0

Impact of Cash Flow Hedges on the Registrant Subsidiaries’

Condensed Balance Sheets

December 31, 2013



	Hedging Assets (a)				Hedging Liabilities (a)				AOCI Gain (Loss) Net of Tax
Company	Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency		Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	363	$	—	$	287	$	—	$	94	$	3,090
I&M	216		—		194		—		46		(15,976		)
OPCo	162		—		—		—		105		6,974
PSO	84		—		—		—		57		5,701
SWEPCo	97		—		—		—		66		(13,304		)



	Expected to be Reclassified to Net Income During the Next Twelve Months
Company	Commodity		Interest Rate and Foreign Currency
	(in thousands)
APCo	$	94	$	(806	)
I&M	46		(1,568		)
OPCo	105		1,363
PSO	57		759
SWEPCo	66		(2,267		)


(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, 2014
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	140	$	3,096	$	3,023
I&M	95		2,096		2,051
OPCo	—		—		—
PSO	3		10,137		5,989
SWEPCo	3		7,729		7,585



	December 31, 2013
Company	Liabilities for Derivative Contracts with Credit Downgrade Triggers		Amount of Collateral the Registrant Subsidiaries Would Have Been Required to Post		Amount Attributable to RTO and ISO Activities
	(in thousands)
APCo	$	575	$	2,747	$	2,539
I&M	390		1,863		1,722
OPCo	349		—		—
PSO	—		2,930		410
SWEPCo	—		713		519