sAMERICANELECTRICPOWERCERTIFIEDMAIL#70123050000216102406RETURNRECEIPTREQUESTEDMr.MikeWilson,DirectorAirPermits(MC163)TexasCommissiononEnvironmentalQualityP.O.Box13087Austin,Texas78711-3087May2,2013RE:RequestforOne-YearExtensionofMACTComplianceDateSouthwesternElectricPowerCompanyWelshPowerPlant-CN600126767,RN100213370DearMr.Wilson:AmericanElectricPower1R1vers1dePlazaColumbus,OH43215-2373AEP.comOnFebruary16,2012,U.S.EPApublishednoticeoffinalregulationsunderSection112(d)oftheCleanAirActforelectricgeneratingunits(EGUs),WelshPowerPlantUnits1,2and3.Theregulations(commonlyreferredtoastheMercuryandAirTaxiesStandardsor"MATS")adoptstringentlimitsforparticulatematter,hydrochloricacid,andmercuryona30-dayrollingaveragebasisforeachunit.Thecoal-firedunitsatWelshPowerPlantarenotcurrentlyequippedwiththenecessarycontrolstoachieveandmaintaincompliancewiththestandards.ForUnits1and3,SouthwesternElectricPowerCompany(SWEPCO)planstoinstallcontrolequipmentthatwillachievecompliancewiththeMATSstandards.ThescheduleforinstallationofthisequipmentonbothunitsextendsbeyondtheApril16,2015compliancedeadline.ForUnit2,SWEPCOisplanningtoretiretheunit,butcertaintransmissionupgradesmustbeinstalledinordertoallowtheretirementofthisunitwithoutadverselyimpactingthereliabilityoftheelectricitygrid.ThescheduletocompletethesetransmissionprojectsalsoisexpectedtoextendbeyondApril16,2015.Accordingly,SWEPCOrespectfullyrequestsaoneyearextensionofthecompliancedeadlinefortheseunits,includingallrelatedperformancetesting,recordkeepingandreportingrequirements,andallapplicablecompliancedatessetforthin40CFRPart63,SubpartsUUUUUandtheapplicablegeneralrequirementsinSubpartA.Mr. Mike Wilson, Director Air Permits (MC163) Texas Commission

on Environmental Quality Page Two May
2, 2013 RE: Request
for One- Year Extension

of MACT Compliance Date Southwestern Electric Power Company Welsh Power Plant- CN600126767, RN100213370 SWEPCO
will retrofit Units

1 and

3 with

a combination

of pollution controls, including activated carbon injection and

a pulse-jet fabric filter baghouse. This compliance option requires detailed study, design, engineering,

and procurement activities,
and receipt

of regulatory approvals prior
to commencement

of construction. Some preliminary design and engineering work has been undertaken

for the controls, however, more detailed design work

is necessary

to support procurement

and other construction activities. Commencement

of certain construction activities will depend
on receipt
of appropriate environmental

and other permits.

It is estimated that even with an expedited construction schedule,

33 months

or more will be required

for construction

and commissioning.

The attached schedule reflects our preliminary overall schedule

to design, permit, procure, construct and commission

the environmental controls, which is expected

to extend into early 2016. SWEPCO submitted

a notification

to the Southwest Power Pool ("SPP")

of the proposed retirement

of Welsh Unit

2 by no later than December 31,2014 (see attached letter), unless SPP identifies
and approves transmission mitigation measures that must be completed prior
to the retirement

of Welsh Unit

2 that have in-service dates beyond December

31, 2014. SPP deveioped

an integrated assessment

of its entire transmission system that mcorporates

the proposed retirement

of Welsh Unit

2 and other proposed changes across the SPP Transmission System. SPP's draft assessment indicates that construction

of new transmission facilities will be required

to maintain compliance
with North American Electricity Reliability Commission ("NERC") reliability standards

as
a result
of these proposed changes.
The SPP Board
of Directors considered

the draft assessment

at its meeting

in the first quarter of2013, and issued

a final report, including
pro

1 osed dates for completion

of construction

of the approved transmission projects

. AEP has received

a notice

to proceed with construction

of the transmission improvements (identified

as Project No. 30495

in SPP's long-term plan) and SPP has scheduled

the project

to be completed

by the end of2015, subject

to AEP's ability

to provide more detailed cost estimates, obtain required regulatory approvals
and rights ofway, and subject to any conditions which may develop during implementation

that could impact the schedule. AEP must notify SPP of any such conditions

as soon
as it is aware
of any potential adverse impact
on the project schedule. AEP

is proceeding with design development

and other project activities,
and requests

an extension

of the MATS compliance deadline until completion

of the required transmission upgrades

or April
16, 2016, whichever

is sooner. The 2013 SPP Transmission Expansion Plan Report can be found on the SPP website

at the following linkMr.MikeWilson,DirectorAirPermits(MC163)TexasCommissiononEnvironmentalQualityPageThreeMay2,2013RE:RequestforOne-YearExtensionofMACTComplianceDateSouthwesternElectricPowerCompanyWelshPowerPlant-CN600126767,RN100213370http://www.spp.org/publications/2013STEPReport.pdf.AreferencetoProject30495canbefoundonpage8of14.TheTexasCommissiononEnvironmentalQualityisauthorizedtogranttherequestedextensionunderSection112(i)(3)(B)oftheCleanAirAct,42U.S.C.§4212(i)(3)(B),andthegeneralprovisionsofPart63.40CFR§63.6(i)(3).FortheunitsincludedinthisrequesttheextensionwillprovidethenecessarytimeforpollutioncontrolinstallationsbeingconstructedinordertocomplywithMATSemissionstandards,andconstructionoftransmissionmitigationnecessarytoprotectthereliabilityoftheelectricitygrid.TherequestedextensionsareconsistentwithU.S.EPA'sdiscussionoftherangeofcircumstancesthatmighttriggeraneedforadditionaltimetocomplyinthepreambletothefinalMATSruleintheFederalRegister.77Fed.Reg.9410-12(February16,2012).SWEPCOrecommendsthatTCEQestablishasemi-annualreportingschedulethatcommenceswiththefirstsemi-annualperiodafterreceiptofthepreconstructionpermitsfortheplannedcontrolsand/ortransmissionupgrades,andisconsistentwiththeothersemi-annualreportsrequiredundertheWelshPlant'sTitleVpermit.Eachreportcanincludeanupdateonthestatusofconstruction,majorequipmentordersplacedduringthesemi-annualperiodcoveredbythereport,andthedateofcompletionofconstruction,asappropriate.SWEPCOcannotpredicttheimpactofotheractionsonthetimeneededtocomply.Forinstance,delaysintheinstallationofcontrolsortransmissionconstruction,permittingdelays,workstoppages,lackofrawmaterialsorskilledlaborcouldoccurthatwillaffecttheavailabilityofthetechnologiesrequiredforcompliancewiththerule.Insuchcircumstances,afurtherextensionmayberequired.Byrequestingthisextensionbasedonknowncommitmentsandobligations,SWEPCOdoesnotwaiveitsrighttorequestanadditionalextensionforthisunitinaccordancewithapplicablelaw.Mr. Mike Wilson

, Director Air Permits (MC163) Texas Commission

on Environmental Quality Page Four May
2, 2013 RE: Request
for One- Year Extension

of MACT Compliance Date Southwestern Electric Power Company Welsh Power Plant- CN600126767, RN100213370 SWEPCO appreciates
your prompt consideration

of this request,
and company representatives

are available

to meet with you to discuss this request and the enclosed supporting information,

if necessary. Please contact Bruce Moore
of my staff
at (214) 777-1116

to arrange a meeting date.

Very truly yours

, John M. McManus Vice President Environmental Services Attachment Copy

w / Attachment: Director

, Air

, Pesticides
and Toxics, USEPA Region

6, w / Att. Michelle Baetz, TCEQ, Tyler TX.,
w / Att. Bruce Moete

, AEP,

w
l Att.A u nit of Amerir.an Flectric PoWI!r March 22, 20 12 Mr. Carl Monroe Chief Operating Officer Southwest Power Pool 415 North McKinley Street

, Suite 140 Little Rock, AR 72205 

### RE: Retirement

of Welsh Unit
2, Pittsburg,
TX Dear Mr. Monroe:

Southwestern Electric Power Company P.O. Box 21106 Shreveport

, LA 71156-0001 t\EP

. com Ventia McCellon-Ailen President and COO As

a Member
and Transmission Customer

of the Southwest Power Pool, Southwestern Electric Power Company (SWEPCO) wants

to confirm

to SPP its plans

to retire Welsh Unit

2,
a 528-MW coal-fired
unit located near Pittsburg, Texas. The retirement

is required

by the terms of
a Consent Order issued
on December

22, 20 II, by the United States District Court for the Western District

of Arkansas, which resolved

all pending legal challenges

to the completion

of construction

and commencement

of commercial operation

of SWEPCO's John W. Turk, Jr. Power Plant, located near Fulton, in Hempstead County, Arkansas.
The Turk Plant

is presently under construction

and expected

to commence commercial operation

by the end of this year. Under the terms
of the Consent Order, after the Turk Plant commences commercial operation, generation from Welsh Unit

2 will be restricted

to a sixty percent annual capacity factor during any rolling 12-month period. Thereafter, Welsh Unit

2 must be retired "by December

31, 2014, unless SPP has identified
and approved transmission mitigation measures that must be completed prior
to the retirement

of Welsh Unit

2 that have
in
service dates beyond December

31, 2014,

in which case SWEPCO
will permanently retire Welsh Unit

2 as soon
as all required approvals have been issued and all necessary transmission mitigation measures have been completed,

but no later than December

31, 2016." Other factors could accelerate

the planned retirement date for this unit. The Environmental Protection Agency (EPA) recently finalized

the 

### National Emission Standards for Hazardous
Air Pollutants from Coal- and Oil-Fired Electric Utility Steam Generating Units

, 77 Fed. Reg. 9304 (Feb. 16, 2012) (hereinafter

the "Utility MATS Rule"), which imposes very stringent requirements

to reduce emissions

of mercury, acid gases, and trace metals present

as particulate matter within three years after the effective date of this new regulation,

or by April 16, 2015. Welsh Unit

2 does not currently meet these standards

, and no new controls
are planned
for this unit due to its imminent retirement date.



### If the retirement

of Welsh Unit

2 has not occurred

by December

31

, 2014, due to the need for transmission mitigation measures

, its operation could
be constrained beginning

on April 16, 2015 by the Utility MATS Rule. There

is a one-year extension available from the Texas Commission

on Environmental Quality (TCEQ)

ifMr. Carl Monroe March 22, 2012 Page Two continued operation

of the unit
is required

to facilitate
the installation

of controls

or due to other construction activities necessary

to achieve compliance through retirement

of certain units.

A further one-year extension may be available from EPA
to assure that the combined impact
of unit retirements

and outages does not adversely affect the reliability of the electric grid. Such extensions,

if available, could allow Welsh Unit

2 to continue to operate
up to December

31, 2016. SWEPCO

is requesting SPP'

s assistance

to identify and develop
the transmission solutions
that will alleviate
any reliability problems
that result from the planned retirement

of Welsh Unit

2. If the preferred solutions cannot

be implemented prior

to April 16, 2015, SWEPCO requests SPP's assistance

in explaining

the required scope of work and schedule

to the TCEQ and possibly EPA
to secure the necessary extensions

to operate Welsh Unit

2 beyond the compliance deadline
for the Utility MATS Rule. We understand
that such evaluations

are already underway based
on SWEPCO's prior responses

to SPP's survey requests. Richard Ross has and will continue

to be our primary contact and assist

in setting up meetings

or discussions between

the appropriate
SPP, SWEPCO

and AEP representatives

on this matter. We appreciate

the cooperation

and assistance provided

by SPP
in developing

and implementing

the necessary mitigation measures

to assure the continued reliable operation

of the electricity grid. Very truly yours, Venita McCellon-Allen cc: Mark
C. McCullough Daniel

L. Snider Richard Ross Janet

J. Henry