American Electric Power Company Inc.
) has entered into an agreement with Utilidata Inc. to upgrade the
next generation of grid side applications. Per the contract,
American Electric will support Utilidata for its product
development activities. This joint exercise will be held at
Utilidata's newly commissioned smart grid simulation and research
center in Providence at Rhode Island.
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Utilidata has strong track record in terms of modernizing the
delivery of electric energy. Its voltage optimization product
called AdaptiVolt solution provides better Volt/VAR Optimization by
using Digital Signal Processing ("DSP"), and it has already
installed this product in a number of American Electric
territories. Volt/VAR Optimization helps to form reliable energy
savings before energy reaches to the customers.
This agreement will speed up the utilization of digital control
technologies in terms of smart grid solutions and improvement of
utility operations, including mixing of distributed generation,
offering fault warning and electric vehicles on the distribution
We know that American Electric continuously modernize its
transmission related infrastructures. Last month, American Electric
Power awarded a transmission contract to
Quanta Services, Inc.
) to reconstruct its 345,000 volt power line of 66 miles located in
Corpus Christi at Texas.
As a result of the current grid improvement process, American
Electric will be able to deliver electricity safely to its
customers at a cheaper price and also in a reliable manner. This
initiative will also enable the customers to consume electric
energy in the future.
In addition to developing transmission services, American Electric
is also working to improve its generation portfolio by gradually
converting coal fired units into natural gas fired units to meet
the environmental standards. The company plans to make long-term
capital investment in the range of $6 billion to $7 billion to
continue its green power development initiatives. We believe that
American Electric's steady investment in different types of
projects will act as a positive catalyst, particularly as a vital
revenue provider in the long run.
However, weak economies in a number of its service states restrict
opportunities for American Electric's future growth. In addition,
uncertainty related to pending regulatory cases and its
predominantly fossil-fuel based generation assets are also matters
Columbus, Ohio-based American Electric Power Company Inc. engages
in the generation, transmission and distribution of electric power
to retail customers. It generates electricity using coal and
lignite, natural gas, nuclear energy and hydroelectric energy.
American Electric Power Company Inc. currently has a short-term
Zacks #4 Rank (Sell rating).