FirstEnergy and other utilities began to slide in May after Federal Reserve Chairman Ben Bernanke suggested that the central bank could begin go to pull back on its stimulus measures.

FirstEnergy, which serves 6 million customers across the Midwest and the Mid-Atlantic, also got hit after the company posted a nearly 50% drop in earnings for the third quarter due to cooler than usual summer temperatures cutting the need for air conditioning. Shares have recently been trading at their lowest levels in a decade.

Mr. Akins said he wants to avoid the bruising battles that delayed or doomed big projects in the past, like the 275-mile Potomac-Appalachian Transmission Highline project from West Virginia to Maryland. AEP and partner FirstEnergy Corp. dropped development plans for the complex project in 2011.

"Sometimes, we were just dreaming" that the companies could get enormous power lines built across multiple states, Mr. Akins said. He said AEP now is focusing on shorter projects blessed by federal regulators that eliminate grid bottlenecks. "It's where you want to put your money," he said.

This includes traditional tactics, such as upgrading power poles and trimming trees near power lines. But it also encompasses newer approaches, such as microgrids and energy storage, which allow operators to quickly reconfigure the system when portions of the grid go down. Implicit to such plans is the need to ensure uninterrupted power to critical sites such as oil and gas refineries, water-treatment plants, and telecommunication networks, as well as gasoline stations, hospitals, and pharmacies.

Some of the nation’s leaders seem receptive to such approaches.

...a transformation of the company’s structure and a shifting notion of what AEP needs to do to remain relevant in a changing energy landscape.

In doing so, the company is de-emphasizing what was once a crown jewel, the fleet of Ohio power plants, and putting a greater focus on developing an interstate network of power lines.

“The less we have to spend on centralized generation, the better off we are,” he said in a recent interview.

When he says “centralized generation,” he means big power plants. AEP will be closing more plants than it is building.

The company is shifting resources so it can expand its transmission system, made up of the high-voltage power lines that carry electricity across state lines and between metro areas.

...NRG is installing solar panels on rooftops of homes and businesses and in the future will offer natural gas-fired generators to customers to kick in when the sun goes down, Chief Executive Officer David Crane said in an interview.

AEP, which was reluctant to split its Ohio operations, has responded by focusing on the delivery business.

Meanwhile, the Ohio power plants are a shrinking asset. Because of environmental rules and the age of some of the plants, the company has announced a series of shutdowns that will occur over the next few years.

Also, AEP is in the process of transferring two plants away from Ohio regulation. The plants, both of which are in West Virginia near the Ohio line, will be regulated in nearby states that allow a utility to sell electricity directly to consumers.

Once the moves are complete, AEP will have 8,668 megawatts of power-plant capacity in the new Ohio power-plant subsidiary, which will be down from 11,652 megawatts today.

Akins says the company is responding to an economic climate in which there is little reason to build power plants in Ohio. The state’s electricity demand has been flat, and the regulatory structure provides no clear way to pay for plant construction.

Akins says he’s having fun and is eager to see the work of the past two years come to fruition.

“We are now at a point where we can start defining our success,” he said. “Before, we had a huge anvil we were dragging around, whether it be environmental expense or whether it be other things we were dealing with that were reactionary. We’re finally at a point where we can map out the strategy of this company going forward. It is exhilarating.”

AEP CEO Nick Akins said the company’s infrastructure investments will be aimed at improving the reliability of electric service to customers. He said the company expects to invest nearly $5 billion in its AEP Transmission Holding Co. unit through 2016, adding the holding company’s contribution to earnings will nearly double in 2014 alone.

Why would you say we need less transmission if a transmission failure triggered a brownout or blackout. I work for a transmission company and we have been prevented from building transmission between regions designed solely to prevent situations like happened. Also, what you don't know much about is that whereever there is a lack of transmission, power plants must be run out of economic order to relieve the line congestion. This causes electric customers (everybody) to pay more. Not only are lines needed for reliability (keep the lights on) but also for economics. Economic studies determine if it's cheaper to add new lines/equipment or just redispatch generation occasionally. If done properly based on well thought out criteria, tranmission is only added when needed and is economic.

We will work tirelessly to assure:
1. Impartial and efficient resolution of all jurisdictional issues;
2. Public safety through inspections of motor carriers, railroads, and natural gas pipelines;
3. An increase in business investment, job creation/retention and the state’s overall competitiveness;
4. An improvement in the standard of living and quality of life for the people of West Virginia;
5. That consumers receive the best value in utility service from financially viable and technically competent companies; and,
6. That utilities receive an opportunity to earn a fair return on their investment in regulated services.

PSC Chairman Michael Albert’s recent remarks before a West Virginia legislative Joint Standing Committee on Judiciary epitomize the stagnant and captive nature of our current PSC leadership. Albert told the committee that the days of cheap utilities are over and that the only remedies for consumers who cannot afford higher utility costs are conservation or budget and consumer assistance programs. Instead of investigating creative solutions, which the PSC is empowered by law to do, Mr. Albert throws in the towel and goes along with the claims of West Virginia’s Ohio-based electric companies.

§24-1-3. Commission continued; membership; chairman; compensation;  quorum.
 
 (b) The Public Service Commission shall consist of three members who shall be appointed by the Governor, with the advice and consent of the Senate. The commissioners shall be citizens and residents of this state and at least one of them shall be duly licensed to practice law in West Virginia, with not less than ten years' actual work experience in the legal profession as a member of a state bar.

AEP said in a filing that, “While AEP Ohio made various attempts to informally resolve this issue, both before and during commission-assisted mediation, it is clear that (FirstEnergy) has no intention to provide any collateral.”

AEP Ohio has been monitoring the proceeding as best it could with the prevalent confidential treatment claims in the record that culminated in FirstEnergy filing its initial post-hearing brief as only a cover page with no attempt at redactions of the limited confidential material. That document was recently filed (redacted) in the docket for outside parties to examine. As an observer of this docket and a market participant, AEP Ohio questions FirstEnergy’s motives for its repeated attempts to shroud the market-related issues in this case under a veil of secrecy.