American Electric Power (AEP) on Wednesday said that it is reorganizing its distribution and customer service operations into seven regional utility divisions, placing operational authority in the hands of division presidents and their support staffs.

“We are creating strong regional utilities to move decision-making responsibility closer to the customers and other external stakeholders,” said Michael G. Morris, AEP’s chairman. “The division presidents and their staffs will have first-hand knowledge of distribution system conditions in their regional utilities and of customers’ concerns. They will have full authority to make decisions on operation and maintenance of the distribution system in their regions to address those concerns.”

Prior to the reorganization, both distribution and customer service functioned on a centralized basis, reporting to AEP management in Columbus. State presidents focused primarily on legislative and regulatory issues.

In the new organizational structure, utility division presidents will have authority for distribution operations and a wide range of customer and regulatory relationships. Generation, transmission, distribution dispatch, call centers and support services will continue to operate on a centralized basis.

“Creating regional organizations for distribution operations and customer service but keeping other operations centralized will strengthen our ties to the local communities while retaining the efficiencies and low costs that are important to our customers and regulators,” Morris said.

Presidents for utilities in AEP’s eastern states will report to Holly Koeppel, executive vice president, AEP Utilities-East. The states include Indiana, Kentucky, Michigan, Ohio, Tennessee, Virginia and West Virginia. Koeppel is currently AEP’s executive vice president for commercial operations.

Presidents for utilities in AEP’s western states will report to Tom Hagan, executive vice president, AEP Utilities-West. The states include Arkansas, Louisiana, Oklahoma and Texas. Hagan is currently AEP’s executive vice president for shared services.

The regional utility divisions and presidents are:

Each regional utility division will have management and staff responsible for distribution operations (including engineering, design and safety), customer services (including customer account management and meter operations), external affairs (including state government relations, environmental affairs, community affairs and communications), regulatory services (including regulatory filings administration and interface with public service commission staffs), and financial (including budgeting and analysis activities and tracking financial performance). Organizational changes are effective June 1.

The creation of regional utility divisions that include areas served by multiple AEP public utility subsidiaries will not change the legal status of those subsidiaries. The AEP-Ohio utility division includes areas served by AEP subsidiaries Ohio Power Co., Columbus Southern Power Co. and Wheeling Power Co. The Appalachian Power utility division includes areas served by AEP subsidiaries Appalachian Power Co. and Kingsport Power Co. AEP-Texas includes areas served by AEP Texas Central Co. and AEP Texas North Co. Each public utility subsidiary will still exist for legal and regulatory purposes.

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