Ladies and gentlemen, thank you for standing by and welcome to the American Electric Power first quarter 2015 earnings call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the call over to our host, Ms. Betty Jo Rozsa. Please go ahead.

Thank you, Brad. Good morning, everyone, and welcome to the first quarter 2015 earnings webcast for American Electric Power. We are glad that you were able to join us today. 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 the statements. Please refer to our SEC filing for a discussion of these factors. Joining me for the call today are Nick Akins, our Chairman, 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.

Thanks, Betty Jo. Good morning, everyone, and thank you for joining the AEP first quarter 2015 earnings call. Just as with first quarter of 2014, we are off to a great start in 2015, with AEP earnings coming in for the quarter at $1.29 per share on a GAAP basis and $1.28 per share on an operating earning basis. This compares with 2014 first quarter earnings of $1.15 per share on both GAAP and operating basis. So we're very pleased with these strong results and the progress we have made. Just as with first quarter 2014, the cold weather and generation performance contributed heavily to these positive results. First quarter 2014 was the coldest in 35 years; first quarter 2015 was the second coldest. But this isn't the only story for the quarter. With weather year-on-year being about the same and earnings being higher than first quarter of last year, the difference is the progress we have made in advancing our growth strategy. This strategy of investing in the regulated companies, particularly Wires and Transmission, focus on continuous improvement initiatives, such as lean practices, the crescendo in savings over time. And a culture of continued disciplined execution of our employees around operational excellence continues to produce positive results. We continue our commitment to this path and reaffirm our previous guidance of $3.40 to $3.60 per share and a 4% to 6% earnings growth trajectory. I know everyone gets excited and believes we should raise guidance, but remember, we are on a multi-year plan of consistent earnings growth and one quarter does not make a year. We are mindful of softer market conditions because of low natural gas prices, changes in seasonal rate structures in Ohio that reduce summer rates that existed before, and we still have significant outstanding rate cases…

Thank you, Nick, and good morning, everyone. On slide 5, you will see our comparison of 2015 operating results to 2014 by segment for the quarter. Operating earnings for the quarter were $625 million or $1.28 per share, compared to $1.15 per share, or $560 million last year. This solid performance was driven by the execution of our regulatory plans, continued growth in our Transmission segment, O&M cost control, and strong marketing results, which together more than offset the adverse effect of lower wholesale power prices. Weather had an equally strong impact on the first quarters of both 2015 and 2014. With that as an overview, let’s review the major earnings drivers by segment for the quarter on slide 6. 2015 earnings for the vertically integrated Utilities segment work $0.61 per share, up $0.04 from last year. The major drivers for this segment include the favorable effects of rate changes, regulatory provisions, and lower O&M expenses, partially offset by a decline in off-system sales margins and normalized load. Rate changes in regulatory provisions were recognized across many of our jurisdictions, adding $0.04 and $0.03 per share, respectively. The favorable effect of rate changes on earnings is related to incremental investment to serve our customers. The effect of the Virginia rate freeze included in regulatory provisions added $0.03 per share. This segment also benefited from lower O&M expense, primarily due to the reduced employee related costs adding $0.03 per share to the quarterly comparison. The $0.09 per share decline in off-system sales margin was driven by much lower power prices this year. The favorable $0.04 per share PJM expenses was related to high PJM costs during last year’s Polar Vortex events that were not recovered in rates. Normalized load adversely affected the comparison by $0.04 per share and was primarily driven…

[Operator Instructions] And our first question will come from Daniel Eggers at Credit Suisse. Please, go ahead.

Hey, good morning, guys.

Hey Dan, how are you?

Great. Thank you. On the Ohio generation conversation, you’ve gotten a little more public as far as your prospective plans for exiting that business. Have we thought about a kind of a timeline of progression of thought, how much clarity do you guys need to see around RPM or around maybe First Energy’s PPA process in Ohio before you feel like you’re at a point where you’re going to optimize the value of those assets?

Yes, so certainly, we need to see, as I mentioned earlier, the capacity performance. Hopefully, FERC will approve that. We can get on with the capacity auctions. We have some interim auctions, as well, as a result of that. And then we also have some auctions on the Ohio side that occur in April/May timeframe. So that’s one set of issues. And that’s on the right side of the ledger. On the left side of the ledger is the PPA issue itself. And it sounds like FE is going to be in hearings in June/July timeframe. So we would want to hear directionally where the Commission is going regarding the PPAs. Obviously, we have the open door in terms of the last order we received that said it was legal and we could do the filings. But we really need some direction in terms of what that means going forward. Now whether that’s defined by the FE case or our rehearing or our case remains to be seen. But certainly, with the new leadership over at the Ohio Commission, we are hopeful that we can see a more consistent approach to this, and make sure we get these orders out quickly so that the market, particularly in Ohio, can understand where we are going next. So those are two big value propositions that we need to get a sense of in this overall process.

And I guess you guys have talked about using that money, presumably, I guess, to go into transmission investment or back into the utility business. How quickly can you scale CapEx at transmission, if you were to get that large amount of sale proceeds back in? Is it a multi-year process to deploy the capital? Or how speedy can you be using that money elsewhere?

Yes, so with our Transmission business, we have a really good speed toward moving projects forward. I mean we have a whole litany of projects that are ready, willing and able, from a capital standpoint. So we are ready, from that perspective. But typically, it will take a couple of years before you start to see the earnings from these facilities to be put in place. So it remains to be seen as something we will have to feel our way through, in terms of whether share buy backs, earn outs, or something like that in a transaction. Those things are critically important to determine the amount of dilution during that period of time. And obviously, we are trying to mitigate any dilution that could occur during that period. So a lot of work going into what the options are that are available to us. But just know that we are focused on trying to mitigate any type of transition from that respective.

Got it, thank you guys.

And your next question will come from Greg Gordon with Evercore ISI.

Thanks. Looking at page 15, on the key drivers for the vertically integrated utilities, there’s a $31 million favorable in the quarter from decreases in unrecovered PJM charges. Can you talk us through what that specifically is? And is that going to annualize, or is that sort of related to Polar Vortex issues?

Greg, this is Brian. Good morning. It was mostly related to the Polar Vortex issues, and it was related to costs associated with reserves and operating expenses that PJM passed through to us in the real time during those Polar Vortexes, that over time and rates, we could get reflected. But given that it happened realtime and we couldn’t get those get those in rates immediately, we had to eat during 2014.

Great. While we are on subject of PJM, the deadline for FERC to allow PJM to extend its tariff and hold its capacity auction later in the summer, then the current schedule is tomorrow? Or is your expectation that we’re going to get an extension?

Certainly, that would be the best outcome. Who knows what FERC will come up with. But I would suspect, with the actual operator, in terms of the auctions, requesting that because of the disruption that would occur relative to the market itself, I think it's probably a – it should be a no-brainer. But it remains to be seen. But our expectation – I mean we would be surprised if they didn't, at this point.

I think, so would the market.

Yeah.

Thank you very much, guys.

Thanks.

Thanks, Greg.

And our next question will come from Julien Dumoulin with UBS.

Hi, good morning.

Good morning.

So perhaps to follow the sales question, can you comment a little bit about the River operations and where you stand on that, and the thought process about that in the context of a regulated mix a little bit?

Yeah, so as far as River Ops is concerned, we obviously announced that we engaged Morgan Stanley to work with us on that process. That process continues. And it's another one of our commercial business is that we are looking at relative to the valuation and disposition of that business. And they are doing a great job. The company is in great shape. But we want to make sure that it fits strategically within the framework that we have going forward. And so that process continues. And I really can't say anything more about it at this point in time.

Do you have a timeframe that you're thinking about, though, just broadly?

My view is that that transaction, if it were to occur, certainly has less issues with it, in terms of milestones to get through. So I would say that the ease of that transaction is probably very different than the rest of the of the unregulated generation on the commercial side.

Got it. And then turning to the regulated business here, let's go down South, Arkansas. In terms of Turk, can you comment on the process to address that and avenues for this year?

So at this point, I mean SWEPCO is in a situation where the market with natural gas and those types of issues are of legitimate concern. So you want to make sure you can put the best foot forward whenever you do go in for recovery of Turk. And the legislation certainly helped out in terms of bypassing a CCN process and being able to file part and parcel to a rate case type environment. So we have to make sure that from an overall rate case standpoint, that it would make sense to file in Arkansas, not only in terms of valuation of Turk and be able to put forward a credible case, but also where you stand from an overall spend situation in Arkansas, as well. So we're going to have to figure out the timing of that kind of filing. Meanwhile, SWEPCO continues to work on other things to reinforce the valuation. We have a large steel customer that's coming online later on this summer. And also, we've got several other cases in Louisiana and in Texas, with the recovery mechanisms in place there, with formula rates and so forth, and transmission, actually, true ups of those kinds of investments. So it's sort of a patchwork to fill in until such time we can get Turk in line.

Got you. Excellent. Thank you.

Okay. Operator And our next question going to come from Paul Ridzon with KeyBanc. Please go head.

Good morning. How are you?

Good morning, Paul.

Looking at slide seven, just kind of the residential sales were very strong last year, down this year. But this isn't a weather adjusted slide. Is this just kind of modeling errors on your weather adjustment, because things were so extreme?

Paul, we've been debating this one for a quarter now. But it's sort of interesting. I'll give my rendition, and certainly Brian has a lot deeper information on this. But when I was doing load forecasting early in my career, it was down in Texas. And you'd have 45 days of 100 degree weather. And you'd see this thing occur that would wind up being a step change and a super peak. And I think it wound up with customers deciding, to heck with it, I'm going to turn my air conditioner on in this heat. So you would see a step change. I think you saw the same thing in the Polar Vortex in 2014, where it's consistently sub-zero for a long period of time. And at some point, people decided they wanted to be comfortable. So you're sort of measuring a present day versus an anomaly. And that sort of drives a skewing of the residential information. That is why I said earlier, we want to see how that settles out from quarter to quarter going forward, so we understand exactly what the steady-state aspects of that is. Brian?

Paul, just adding to that a little bit. I think across the industry, we saw weather normalization in residential in the first quarter of last year look similar to ours. And it looked a little bit out of whack, and it sort of normalized over the balance of the year. That's why, as Nick said, the quarter-on-quarter comparison of this year to last year looks kind of negative. We're interested in seeing how the balance of the year flattens out and what that looks like. But we really believe last year's first quarter weather normalization to be a bit of an anomaly.

So it's an art, not a science. Okay. And then last year, after a very strong first quarter, you started talk about pulling forward some O&M from the forward year. At what point are you comfortable doing that in 2015?

Yes, Paul. We're starting that process now. Actually, we've already started it. We do have some O& we've identified that could be pulled forward. But at the same time, it becomes – we pulled $60 million forward last year. So now, you're really getting into areas where, okay, can you pull forward, from that prospective? So it becomes a little bit more difficult. So we're having to reach deeper and think really hard about how much we can actually move forward. So that process is continuing and something that we are very mindful of, given that we started the year somewhat ahead.

Is there reluctance to do it until you get a little more of the year under your belt?

No. No. I think we have identified and started that process and we will continue it on. Now keep in mind, last year we had relatively mild summer. So we will continue looking at the levers and looking at the quarter by quarter performance, and we will make adjustments accordingly. We've gotten pretty good at that.

Thank you very much.

Yep.

And our next question in line will come from Paul Patterson with Glenrock Associates. Please go head.

Good morning. Can you hear me?

Yes. I can hear you.

First of all, on the trading business, that seemed to be pretty beneficial this quarter. What are the expectations for the year?

we think it's in line with what we've previously stated for the business, Paul. There are a couple things going on there. They continue to do their normal activity. So the trading and marketing they do, they had a couple of big deals that they got closed in Texas, which were positive for the quarter. But don't forget that when we laid guidance out for 2015, there is about a $0.35 hit associated with changes in capacity revenues in that business. So we think we're on track. We are little bit skewed towards being ahead for the quarter. But the real drags on that business are going to be the latter half of that year, as we experience the fall off in capacity revenues.

And what happened in Texas? I'm sorry if I'm missed that.

We had some normal ongoing marketing activity that we do down there. So as we own these businesses, we're going to continue to operate them with an eye towards the long term. And they were able to renegotiate and change the terms a bit on a couple of contracts that they have down there, which is normal ongoing business for us. But that was beneficial to the quarter.

Okay. Then in terms of just Ohio, I mean is everything pretty much going to be – I mean, obviously, there is all this focus on PUCO. Is there any potential for the Governor or any other direction to sort of come from, I guess, legislative or the executive branch, in terms of the direction that the state wants to go into? Or is it really just going to be something that PUCO is going to be wrestling with on its own? Any thoughts about that?

I think for the time being, it’s going to be centered at the Commission, because Andre Porter has moved over as Chairman, who previously was involved with the deregulation that occurred some three years ago. And so he knows and understands the issues. And also hopefully, understands the lessons that have been learned since then, as well. And I think he and the Commission, under his leadership, will continue to provide direction, but also consistency and get these orders done. He has also brought on a new chief of staff, which we have certainly met. And he appears to be very, very professional about what he is doing, as well. So I think with some sense of consistency around leadership and in terms of direction associated with the staff itself, at least I am hopeful that things will start moving pretty expeditiously in Ohio.

Okay. And then just finally, it was the seams issue between PJM and MISO. There’s been some activity in it. And I think there’s been sort of a push on the part of FERC to move things along. Does that – do you guys see any significant impact from that, positive or negative? You guys have served in different areas there. And of course, we’ve got questions about what’s going to happen with the merchant sector anyway. But anything we should be thinking about with respect to that and how it might impact your merchant plants?

No. I don’t think we see much impact, from our perspective, and as far as MISO is concerned. I mean, one thing is for sure, they really need to start thinking – PJM and MISO need to administer that contract they have with each other, from an operational standpoint. I know there have been issues that have come up relative to how they actually administer the flows over the lines. But I think as far as we’re concerned, though, we’re in pretty decent shape.

Okay. Great. Thanks so much.

And our next question will come from Brian Henn with Merrill Lynch. Please go ahead. Q – Brian Henn: Hi, good morning. Just a quick one.

Good morning. Q – Brian Henn: On the 4% to 6% EPS CAGR growth rate outlook, in general is there a Brent crude oil price environment that you are thinking about when you reaffirm that guidance? I realize these things are probabilistic. But it would be helpful to know if you’ve got an oil price in mind.

Certainly, we haven’t gotten down into the fundamentals that much. But from our perspective, it’s really around natural gas pricing. As far as oil pricing is concerned, it’s a measure of how much the rig count changes. But that’s reflected in natural gas as well. So from our perspective, we continue to look at, at least our factors relative to the industrial mix that we have and the impact of energy prices, because even low oil prices can reflect well in the economy that we serve. And so we have sort of a natural hedge going on here, where oil and gas pricing has benefited some counties, with shale gas production and that kind of thing. But on the other hand, low natural gas prices have helped chemical manufacturing, car manufacturing and so forth. Brian, do you have anything you want to add? A – Brian Tierney: That last point that you got nailed it in my mind, Nick, in that we do have that natural hedge going on. And we see things like transportation equipment manufacturing is positively impacted by the low oil and gas pricing. So where we see some delays or closures in terms of economic expansion, we also see some expansions going on. And those things, to date, have really offset one another. Q – Brian Henn: Appreciate it. Thank you.

Thank you.

And the next question will come from Anthony Crowdell with Jefferies. Please go ahead.

Good morning, guys. I have a question on slide 6. I guess in three of the business segments, you guys had some cost-cutting error, some cost management where O&M was off, operating costs were a positive driver. How much more can we expect of that going forward, or is this more of a timing issue?

Some of it is timing. But overall, you will continue to see O&M continue to be consistent from the perspective of ensuring that we mitigate any increases. Because obviously, you have overheads, salaries, those kinds of things continue to go up. But we’re mitigating that, in many respects, from an O&M perspective. So our O&M stack continues to be consistent, relatively consistent from year-to-year. We expect that to happen. So Brian, you may have something else. A – Brian Tierney: Anthony, we’ve worked really hard to keep that O&M flat to down over the last several years. And then looking out into 2016, as we have those capacity revenue challenges in that year, we are very, very focused on keeping O&M in a very tight range. We have been able to keep it in that $2.9 billion, $2.8 billion to $3.1 billion range, even with some of the natural increases that you would expect that we would have associated with things like our transmission expansion. So the Lean activities that Nick talked about have us very focused on O&M, keeping it flat to down over the long term. What you see on slide 6 is what you should anticipate seeing going forward as well.

So I think it may be a part of both. But keep in mind that there will be a consistent view toward that perspective.

Great. And just lastly, I know you’ve probably spoken ad nauseum of it, just the unregulated generation in Ohio. If I understand correctly, before any decision is made on how AEP handles it, you want some clarity on the capacity performance auction and also the Ohio PPA process. Is that accurate?

Yes. That’s accurate.

Great. Thank you so much for taking my questions.

And our next question will come from Ali Agha with SunTrust.

Thank you.

Good morning, Ali.

Good morning. How are you?

Fine, fine.

Nick, just listening in to the commentary and from the results as well, is it fair to assume that first quarter puts you somewhat ahead of budget? Obviously, it’s very early in the year. And if so, how much cushion is there for you right now – you talked about pulling forward some expenses. Is there any way to quantify how much cushion you have as we look for the rest of the year?

I think we have enough cushion to be comfortable with starting to take steps and being more aggressive about what we do, relative to moving O&M up and doing other things to reinforce the issues that we have in 2016. So just as with last year, where we got ahead, we will be looking at taking additional steps. And we will manage that from quarter to quarter. In this case, though, I think you have a quarter where, certainly it looks – it’s really positive. But you have a different set of underlying factors to consider, like last year at this point in time, there really wasn’t much of a rate stack to fill in or anything like that. And this time, there is some larger swings that can occur. So I would say, overall, we are very confident about our ability to aggressively pursue in a positive way. Obviously, it’s a better problem to have than if it was on the downside. So we feel good about where we are at.

Ali, you’ve come to expect from us over the years that we are going to manage our way through a year and across years. And that’s exactly what we’re doing. So the guidance that we laid out, we are still comfortably within that guidance for the year. And as the year goes on, depending on what happens with earnings and cash flows and the like, you’re going to see us managing our way to stay in a range that puts us in that guidance, and then within that 4% to 6% growth range that we’ve talked about over several years.

Got it. And also, just to clarify another point on the merchant, in the past, Nick, you’ve been fairly consistent that you expected to reach a resolution over the summer timeframe. We have talked about some things getting pushed back. Even if the PJM capacity gets pushed back, I think they’re still talking June through August. So I guess technically still in the summer. But the PPA rider may be further down the road. So is summertime still what we should think about? Or how should we think about, given some of these delays in some of these milestones?

Yes. I think it’s difficult to tell at this point. Because obviously PJM is trying to push aggressively to get the auction done as quickly as possible. So if we hit early summer and that kind of thing – and then the previous questioner obviously was asking somewhat the same thing. From the Ohio perspective, we just need to know directionally what Ohio is going to do. So whether that comes from our rehearing, or FE’s PPA case, or ultimately our larger PPA case, we just need to understand what that sense of direction is going to be. And so I am not going to say it’s going to fall back at this point, from a decisional process. Certainly, the delay takes away some of the wiggle room that you had for the summer. But it’s really hard to hard to say, at this point. We will have to keep our ear close to the ground, in terms of what FERC is doing and what the Ohio Commission is doing to resolve that issue. I guess my main point is that we have gone through the analysis. Our Board has been involved every step of the way. So our reaction time is very minimal, at this point. We just need the factual information.

Okay. And one last quick question. In your longer term Transmission growth slide that you’ve shared with us, you’ve had higher growth case scenarios, particularly for 2016 and 2017 that are fairly meaningfully higher than base scenarios. Any of those projects yet that are moved into base, as we look in the 2016-2017 outlook?

Not in that timeframe. We’ve been able to fill in some of the gap in 2015, so far. But Ali, as you look at some of the earlier questions that we got, if there are going to be transactions, in terms of use of proceeds, that’s primarily where we would be focused on filling in the gaps.

All right. Got it. Thank you.

Thanks.

We’re focus is really on 2016 and the issues around that. Because we certainly want to give some sense of continuous improvement in terms of earnings and be able to really approach that in the right way. So 2017 and 2018 and beyond, we’ll probably have more color on that by the time EEI rolls around in November.

And next question will come from Michael Lapides, Goldman Sachs.

Hey guys, congrats on a good start of the year.

Thanks, Michael.

When we think about last year, you had a great first quarter, and you talked about moving some O&M into 2014. And you’ve talked a little bit about doing it this year, although it sounds like there is not as much wiggle room there. One of the other things you did last year is you moved up a couple hundred million dollars of transmission spend into 2014, or you raised your transmission CapEx view, for prompt here. Just curious whether you’re likely to do the same thing this year, given such a strong or healthy start to the year.

Michael, a couple of things on that. One is, we had about a $200 million planned and funded to higher transmission spend. We’ve been able to move dollars out of other CapEx buckets that we’ve had into transmission. And that includes both the transmission holdco and the vertically integrated utilities transmission spend. So of that $200 million, we’ve been able to fund about $80 million of that. And then just on the prior question from Ali, if there are to be proceeds from transactions that might happen later this year, the primary place for that to go would be the transmission spend.

Yes. And I’m just thinking outside of transactions, because that’s kind of bigger dollars versus where I am focused here. I didn’t know if you are making another increase to expected transmission spend, given a strong first quarter 2015, similar to like what you did in the first quarter of 2014.

Not at this point.

Not at this point.

Yes.

But just know that we continue to advance our transmission spend. And if conditions wind up that way, we will be happy to do it.

Got it. And because when I start looking, Brian, at the balance sheet and your capitalization ratios, they’re getting pretty healthy. They’ve been getting healthy for the last couple of years. But they are now reaching – I think your FFO to debt is, on a percentage wise, getting at or even better than some of your targets. Just curious about when the health of the balance sheet, regardless of having had such a strong first quarter, enables you to deploy more capital in the transmission maybe a little bit earlier than you thought.

Yes, so very good point there, Michael. I think the CapEx that we spent last year, the 4.4 that we spent this year, were predicated on those improving credit metrics. Again, if we were to change the portfolio of businesses that we have, we think we would have even more balance sheet capacity. I think you saw Duke get an upgrade on the sale of its competitive generation business. We would expect a similar actions by the rating agencies if we were to transact going forward, which would give us even more balance sheet capacity. And if and when those things happen, you know where we’re going to be spending those dollars. It’s going to be on that transmission growth story that we have going on.

Got it. Last question, just thinking about transmission. We’ve seen some changes come out of the FERC regarding transmission ROEs. We’ve seen a multitude of cases in other RTOs in the Midwest ISO and in ISO New England. We have not seen a lot of activity regarding that in PJM. Just curious for your view on kind of why PJM is one of the few regions where we haven’t seen a lot of Section 206-type cases for ROEs.

I think you haven’t seen the ROEs out of the realm of reasonableness. So there’s a bandwidth for that. And certainly, I see FERC continuing to encourage the investment in transmission. And so, you see some of these one-off type of cases. And they have their own situations, whether it’s their RTO premium, that kind of thing. And when you look at the aggregated total from a ROE perspective, we’re still within the range of reasonableness, comfortably. So we don’t expect much change, from our perspective.

Got it. Thank you, guys. Much appreciated.

Operator, we have time for one more question.

Thank you. That will come from Angie Storozynski with Macquarie.

Thank you very much. So I have two questions again, about the merchant power business. Just so we’re clear, assuming that the capacity auction clears at strong levels, would that be a bullish indicator for a possibility of PPAs in Ohio, in a sense that that would allow you guys to prove that those PPAs would be beneficial to rate payers?

Angie, you bring up a great point, and certainly one that we think about a lot. Because there’s two sides to the equation that are working here. And as you talk about PJM and what FERC can do and the capacity auctions, if the capacity auctions improve considerably, then that may, in fact, have a negative impact on the ability for PPAs. And I am saying negative from our perspective, because the market is saying the value that capacity is going up considerably. So you look at what Ohio is doing. Ohio looks like a long-term PPA customer to us. And typically, long-term PPA customers will enter into contracts when prices are lower so that they can lock in value for customers in the future. And my concern is, if the market continues to increase considerably, that we will be looking at investors saying, why are you entering into PPAs with a market going up considerably? And that will be a problem for us. So I think the Ohio Commission, and the state of Ohio, really needs to think about that, in terms of the long-term stability of Ohio and where it’s placed in the right now. Because we’ve demonstrated that the PPAs are a benefit to customers over the long term. And so a decision needs to be made. So to me, I think, in some cases, the race is on. And we have to get this resolved.

Okay. And secondly, assuming that you do sign those PPAs for 2,700 megawatts and that similar things happened for synergies assets and potentially other diversified utilities in the state. So how do you think those PPAs are going to impact the value of the remaining 5,000 megawatts that you will be planning to sell on a merchant basis?

Yes. So the units that are placed in the 2,700 megawatts, they are ones that are still fit well in the market, but they’re probably the most at risk. And Ohio has to look at that from – we want to keep the generation. We want to keep it running. We want to keep the taxes, the jobs, but there is still a benefit to customers. So the other generation will continue to fit very well into the market. And then from the PPA perspective of generation fleet itself, if it is approved the way we presented it, with a long-term approach that’s essentially life of plant and those kinds of things, it becomes somewhat neutral. Because you have a situation there where it is quasi regulated. So I think it could wind up being a really good fit, because you would have the certainty around a portion of the portfolio in Ohio. And then Ohio could still take advantage of any market fluctuations that may occur, just like we do with any other portfolio we have. There’s a fixed portion. There’s a variable portion. And I think that’s ultimately best for customers, just like we do fuel.

Very good. Thank you.

Yes.

Thank you for joining us on today’s call. As always, the IR team will be available to answer any additional questions you may have. Brad, would you please give the replay information. Thank you.

Thank you. Ladies and gentlemen, this conference will be made available for replay after 11:15 AM today and running through Thursday, April 30 at midnight. You can access the AT&T Executive Playback Service at any time by dialing 1-800-475-6701, and entering the access code 357746. International parties may dial 1-320-365-3844. Those numbers again, 1-800-475-6701 and 1-320-365-3844 with the access code 357746. That does conclude our conference for today. Thank you for your participation and for using AT&T Executive Teleconference Service. You may now disconnect.