aeped.com

Kentucky PowerEconomic Development Efforts

Brad N. Hall, IOM, MBAManager of External Affairs

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American Electric Power System

Kentucky Power

- 5 million customers- 11 states served- Approx. 18,500 employees- 38,000 MW capacity- Generation Mix:- Coal/lignite, gas, hydro, nuclear, wind- 39,000 miles of transmission lines

Who we are

- Since 1919-173,000 customers- Approx. 300 employees- Serve all or parts of 20 counties- 2 generating units (coal) 1,078 MW- Approx. 2.5 million tons coal/year- Approx. 11,000 miles of power lines- 3 districts: Ashland, Hazard, Pikeville

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What is Economic Development?

Economic Development is the concerted actions of communities and policymakers that improve the standard of living and economic health of a specific locality.

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ED in East KY

Challenges for ED in Eastern Kentucky Declining population

Unorganized ED effort

Competition with Central and Western KY

Opportunities for ED in Eastern Kentucky Available work force

Low cost of living

Affordable, available land

Strong legislative representation and Coal Severance Money

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Four Tiered Approach to ED

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Professional Analysis

• InSite Project – Phase I– ED Efforts Analysis– LEDO Blueprint

• InSite Project – Phase II– Property Inventory– Property Marketing Plan

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Business Retention & Expansion

• Support our existing businesses by supporting their investment in our region

• Identify business development opportunities to expand their operations

• Existing business meetings

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Community Assistance

• Economic Development Training Opportunities– Kentucky Institute for ED Scholarships– Webinars / Seminars

• Economic Development Summit• Site Certification Assistance• Marketing Assistance

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Business Attraction

• Generate Prospects– Cabinet for Economic Development– AEP – National Accounts and Target Marketing– Kentucky United

• Partner with LEDO’s• Develop and organize an inventory of properties• PROSPECT MANAGEMENT!

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Effective Prospect Management

Professionalism

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Community Readiness & Marketing Plan Development

• Consensus• Geographical Consensus• Organizational Consensus• SWOT Analysis Consensus• Economic Development Initiatives• Target Sector• Promotional Activities

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Community Readiness

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Community Readiness

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Community Readiness

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Community Readiness

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Community Readiness

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Community Readiness

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Community Readiness

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Marketing to Site Selection Consultants

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Facility Siting Fundamentals

• Big Things to Remember– Investment is Made for Profit– Investment Activity has Choices with Regards to

Location– Data Driven Decisions– If you build it, they will come. If you wait to build it

when they come, THEY ARE NOT COMING!

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Facility Siting Fundamentals

Facility Siting Process Fundamentals• Profit Driven – Investment for purpose of return• Deadline driven – Both the site selection and the

project• Competitive – Multiple location options• Comprehensive – Complex decision involving

most functional areas• Risk averse – “Shovel Ready”

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Facility Siting Fundamentals

Fundamentals – Site Selection Screening Process

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Facility Siting Process

Planning Phase Phase I Phase II Phase IIIConception Alignment / Criteria Community Visits NegotiatonsFeasability Regional Analysis Site Evaluation Site Due DiligenceInvestment Decision Areas of Interest Comparative Analyses Risk Analysis

Candidate Communities Finalist Communities SelectionIssue RFP Announcement

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Trends in the Facility Siting Process

• Phase I – The OLD WayCall sate Verify infrastructureProvide Criteria Double check dataAsk for submittals Visit candidate sits with clientRequest data Hire technical consultantsCreate spreadsheets and models Investigate representationsEliminate those not acceptable Peform compartitive assessmentsRequest specific data Peform a risk assessmentContact the community Make recommendationsVisit sites Enter into negotiationsRequest more data specifics Perform site due diligenceRun more models Select siteVisit various agencies

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Trends in the Facility Siting Process

• Phase I – The New Way

Use client driven criteria to screen candidatesUtilize geographic information system (GIS Technology)Identify candidate regions / communitiesAdvise EDA of candidacyCollect specific dataAnalyze model various scenariosMake recommedationsEnter into negotiationsPeform due diligenceSelect site

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What will make you a Winner?

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The Bottom Line

Kentucky Power Wants to Be…• A resource to assist you in attracting new

business• A resource to assist you in retaining and growing

existing businesses• A resource for training and improvement of ED

skillsets• Your Partner in Economic Development

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Questions?Brad N. Hall, IOM, MBA

Kentucky PowerManager of External Affairs

Email: bnhall@aep.comOffice: 606-437-3790Cell: 502-382-0507