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                                                                  EXHIBIT 10(r)

                         AMERICAN ELECTRIC POWER SYSTEM
                               NUCLEAR PERFORMANCE
                       LONG TERM INCENIVE COMPENSATON PLAN

                                    ARTICLE I

                            Establishment and Purpose

     1.1 The Company  hereby  establishes  the  American  Electric  Power System
Nuclear Performance Long Term Incentive Compensation Plan effective as of August
1, 1998.

     1.2 The purpose of the American  Electric Power System Nuclear  Performance
Long Term Incentive  Compensation Plan is to enhance the performance of the D.C.
Cook Nuclear Plant and to reward those employees who efforts are instrumental to
the performance of the D.C. Cook Nuclear Plant.

                                   ARTICLE II

                                   Definitions

     As used herein the  following  words and phrases  shall have the  following
respective meanings unless the context clearly indicates otherwise.

     (a) "AEP  Stock  Unit"  means a phantom  stock  unit  equal to one share of
Common Stock for which no certificates shall be issued, which do not have voting
rights and a bookkeeping record of which shall be maintained by the Company.

     (b) "Award  Certificate"  means a  certificate  setting forth the terms and
provisions applicable to each grant of AEP Stock Units, which shall include, but
shall  not  be  limited  to,  the  number  of AEP  Stock  Units  granted  to the
Participant,  the  Performance  Objectives,  and the  length of the  Performance
Period.

     (c) "Committee" means the individuals  holding the following offices within
the  Company;  Chairman of the Board,  President  and Chief  Executive  Officer;
Executive Vice President-Financial  Services; Executive Vice President-Corporate
Services;   Senior   Vice   President-Nuclear   Generation;   and  Senior   Vice
President-Human Resources.

     (d)  "Common  Stock"  means the common  stock of  American  Electric  Power
Company, Inc., a New York corporation and any successor thereto.

     (e) "Company" means American Electric Power Service Corporation, a New York
corporation, and any of its subsidiaries and affiliates.

     (f) "Disability"  means a total and permanent  disability as defined in the
American Electric Power System Retirement Plan as amended from time to time.

     (g) "Fair Market Value" means the closing sale price of the Common Stock as
published in the Wall Street  Journal  report of the New York Stock  Exchange on
the date in question,  or if the New York Stock Exchange is Closed on such date,
then the first day prior theret6 on which the Common Stock was so traded.

     (h) "Participant" means any full-time employee of the Company, who has been
selected to participate in the Plan for a stipulated Performance Period.

     (i)  "Performance  Objectives"  means the annual  Plan Year  objectives  or
multiple Plan Year  objectives  established  by the Company for the operation of
the D. C. Cook Nuclear Plant

     (j) "Performance  Period" means the Plan Year or Plan Years  established by
the  Company  over  which the  Performance  Objectives  will be  measured.  If a
Performance  Period  is for two or more Plan  Years,  the  attained  Performance
Objectives for each Plan Year within the Performance Period shall be averaged to
determine the attained Performance Objective for the Performance Period.

     (k) "Plan" means the American  Electric  Power System  Nuclear  Performance
Long Term Incentive Compensation Plan.

     (l) "Plan Year" means the calendar year  commencing on January 1 and ending
on December 31.

     (m)  "Retirement"  means a termination of employment  after the Participant
attains age 55 and has completed five years of service.


                                   ARTICLE III

                                 Administration

     3.1 The Committee  shall  administer the Plan. The Committee shall have the
authority to interpret  the Plan and to  prescribe,  amend and rescind rules and
regulations   relating  to  the   administration  of  the  Plan,  and  all  such
interpretation,  rules and  regulation  shall be  conclusive  and binding on all
Participants.

     3.2 The  Committee  may employ  agents,  attorneys,  accountants,  or other
person and  allocate or delegate to them powers,  rights,  and duties all as the
Committee  may  consider  necessary  or  advisable  to  properly  carry  out the
administration of the Plan.

     3.3 If  the  Committee  determines  that  the  occurrence  of  any  merger,
reclassification, consolidation, recapitalization, stock dividend or stock split
requires an  adjustment  in order to preserve  the benefits  intended  under the
Plan,  then the Committee may, in its discretion,  make equitable  proportionate
adjustments in individual AEP Stock Unit grants.


                                    ARTICLE V

                          Eligibility and Participation

     4.1  Eligibility for  participation  in the Plan shall be limited to senior
officers  who,  in  the  opinion  of  the  Committee,   have  the  capacity  for
contributing in a substantial measure to the successful  performance of the D.C.
Cook Nuclear Plant.

     4.2 At the beginning of each Plan Year, the Committee shall identify which,
if any,  Participants shall receive a grant of AEP Stock Units for a Performance
Period that  commences at the start of the Plan Year. At the sole  discretion of
the  Committee an  individual  may become a  Participant  in the Plan after tile
start of a Plan Year or a Performance  Period and shall receive  prorated grants
of AEP Stock  Units.  As soon as  practicable  following  the  selection  of the
Participants,  the  Committee  shall  provide  each  Participant  with an  Award
Certificate.


                                    ARTICLE V

                            Grants of AEP Stock Units

     5.1 Grants of AEP Stock Units:

          (a) AEP Stock Units may be granted to Participants as of the first day
     of each Performance Period;  however,  grants do not necessarily have to be
     made to Participant on an annual basis. The number of AEP Stock Units to be
     granted to each  Participant  shall be  determined  by the Committee in its
     sole discretion.

          (b) If an individual  becomes a  Participant  after the first day of a
     Plan Year or Performance Period, the Committee may grant AEP Stock Units to
     tile Participant as follows:  (i) AEP Stock Units for a Performance  Period
     that ends in tile Plan Year in which tile individual becomes a Participant;
     (ii) AEP Stock  Units for a  Performance  Period that ends in the Plan Year
     immediately  following  the Plan  Year in which  the  individual  becomes a
     Participant;  and (iii) AEP Stock Units for a Performance  Period that ends
     in the second full Plan Year after the  individual  becomes a  Participant.
     The number of AEP Stock  Units  granted  for each such  Performance  Period
     shall be determined by the Committee in its sole discretion.

          (c) The value of the AEP Stock Units granted to a  Participant  at the
     commencement  of a Plan Year or  Performance  Period as provided in section
     5.1(a) or after the  commencement  of a Plan Year or Performance  Period as
     provided in section  5.1(b) shall be calculated on the basis of the average
     of the Fair Market  Value of the Common  Stock for the last 20 trading days
     prior to the start of a Plan Year or Performance Period.

     5.2 During the  Performance  Period,  Participants  will be  credited  with
dividends,  equivalent  in value to those  declared  and paid on  shares  of the
Common Stock,  on all AEP Stock Units granted to them.  These  dividends will be
regarded as having been  reinvested in AEP Stock Units on the date of the Common
Stock dividend payments based on the then Fair Market Value of the Common Stock,
thereby increasing the number of AEP Stock Units Held by the Participant.

     5.3  The  Committee  shall  establish   Performance  Periods  in  its  sole
discretion. The minimum Performance Period shall be for one year and the maximum
Performance Period shall be for three years in length.


                                   ARTICLE VI

                            Determination and Payment

     6.1 The number of AEP Stock Units earned by a Participant for a Performance
Period shall be determined by multiplying  the number of AEP Stock Units held by
the Participant at the end of the Performance  Period by a factor based upon the
Performance Objectives.

     6.2 The payment of earned AEP Stock  Units shall be made in cash.  The cash
payment shall be calculated on the basis of the average of the Fair Market Value
of the Common Stock for the last 20 trading days of the  Performance  Period for
which the AEP Stock Units were earned.

     6.3  At  least  one  year  prior  to  the  end  of  a  Performance  Period,
Participants  may make an election to defer the cash payment of earned ABP Stock
Units for one or more  years.  However,  if the  Participant's  deferral  period
extends beyond the  Participant's  employment  termination date, cash payment of
the earned  AEP Stock  Units must  commence  no later than five years  after the
Participant's termination of employment. Deferred AEP Stock Units shall continue
to be credited with dividends during the deferral period and the dividends shall
be reinvested in additional AEP Stock Units as provided in Section 5.2. The cash
payment of the deferred AEP Stock Units shall be  calculated on the basis of the
average of the Fair  Market  Value of the  Common  Stock for the last 20 trading
days prior to the date the Participant's deferral period terminates.


                                   ARTICLE VII

                            Termination of Employment

     7.1 In the event of a Participant's  termination of employment prior to the
end of a Performance  Period, but after the first six months of such Performance
period,  by  reason  of  the  Participant's  death,   Disability  Retirement  or
involuntary  termination  other then for cause, the Participant will be eligible
to earn prorated AEP Stock Units for each such Performance  Period which has not
yet ended,  determined pursuant to Section 6.1 for such period and the number of
days of participation during such Performance Period.

     7.2 In the event a Participant's  employment is terminated prior to the end
of a Performance Period for reasons other than death, Disability,  Retirement or
involuntary  termination  other than for cause,  all rights to any  unearned AEP
Stock Units under the Nuclear Performance Plan shall be forfeited.

     7.3 In the event a  Participant  dies prior to the complete  payment of the
Participant's  award, the amount owning to the Participant  shall be paid to the
Participant's  spouse if the spouse is then living.  If the  Participant  is not
married at the time of death, the amount owing to the Participant  shall be paid
to the Participant's estate.

     7.4 In the event American Electric Power Company,  Inc., or the Company, or
Indiana  Michigan  Power  Company  sells or otherwise  disposes of the D.C. Cook
Nuclear  Plant and the acquirer of the D.C. Cook Nuclear Plant does not continue
this  Plan,  the Plan shall be deemed to have  terminated  as of the date of the
sale  or  disposition  and the AEP  Stock  Units  awarded  and  credited  to the
Participants  as of the date of sale or  disposition  shall become fully vested.
The  value  of each AEP  Stock  Unit  shall be paid in cash to the  Participants
within 60 days of the date of sale or  disposition  assuming that as of the date
of sale or disposition  the Performance  Measure was attained.  The cash payment
shall be  calculated on the basis of the average of the Fair Market Value of the
Common 8tock for the last 20 trading days immediately  prior to the date of sale
or  disposition.  If the acquirer of the D.C. Cook Nuclear Plant  continues this
Plan, American Electric Power Company,  Inc., or the Company or Indiana Michigan
Power  Company will not be liable or  obligated to make any payments  under this
Plan.


                                  ARTICLE VIII

                            Amendment or Termination

     8.1 The  Committee  shall  have the  right,  authority  and power to alter,
amend, modify, revoke or terminate the Plan.

     8.2 No amendment or  termination  of the Plan shall  directly or indirectly
deprive any current or former  Participant of all or any portion of any benefits
earned up to the date of the amendment or termination of the Plan.


                                   ARTICLE IX

                                Change In Control

     9.1  Notwithstanding  any  provisions  of this Plan to the  contrary,  if a
Change in Control of the Company  occurs,  all AEP Stock Unit grants awarded and
credited to the  Participants  shall be deemed to be fully earned as of the date
of the Change in Control. The determination of the AEP Stock Units shall be made
as of the last day before the Change in  Control.  Payments  of AEP Stock  Units
shall be made in cash within three months after the Change in Control.  The cash
payment shall be calculated on the basis of the average of the Fair Market Value
of the Common Stock for the last 20 trading days immediately proceeding the date
of the Change In Control.

     9.2 For  purposes  of this  Article IX, the term  "Company"  shall mean the
American  Electric  Power  Company,  Inc.,  a  New  York  corporation  and  it's
subsidiaries.  All references to the term Company in other Articles of this Plan
shall have the meaning as provided in Article II(e).

     9.3 A "Change in Control" of the Company  shall be deemed to have  occurred
if (a) any  "person" or "group"  (as such terms are used in  Sections  13(d) and
14(d) of the Securities  Exchange Act of 1934  ("Exchange  Act")),  other than a
trustee or other fiduciary holding  securities under an employee benefit plan of
the Company,  becomes the "beneficial owner" (as defined in Rule l3d-3 under the
Exchange  Act),  directly  or  indirectly,  of more than 25  percent of the then
outstanding voting stock of the Company; (b)during any period of two consecutive
years,  individuals  who at the beginning of such period  constitute  the Board,
together with any new Directors  whose  election or nomination  for election was
approved by a vote of at least  two-thirds of the Directors then still in office
who were either  Directors at the  beginning of the period or whose  election or
nomination  for election  was  previously  so approved;  cease for any reason to
constitute at least a majority of the Board;  or (e) the Company's  shareholders
approve a merger or  consolidation  of the Company  with any other  corporation,
other than a merger or consolidation which would result in the voting securities
of the Company  outstanding  immediately  prior thereto  continuing to represent
(either by remaining outstanding or by being converted into voting securities of
the surviving  entity) at least 75 percent of the total voting power represented
by the voting  securities of the Company or such  surviving  entity  outstanding
immediately after such merger or  consolidation;  or (d) the shareholders of the
Company approve a plan of complete  liquidation of the Company,  or an agreement
for the date or  disposition  by the Company (in one  transaction or a series of
transactions) of all or substantially all of the Company's assets.

     Notwithstanding  the foregoing,  a Change in Control shall not be deemed to
occur as a result of any event  described in (a) or (c) above,  if Directors who
were a majority of the members of the Board prior to such event and who continue
to serve as  Directors  after  such  event  determine  that the event  shall not
constitute a Change in Control

     For purposes of this Section 9.3, "Board" shall mean the Board of Directors
of  American  Electric  Power  Company,  Inc.  and  `"Directors"  shall  mean an
individual who is a member of the Board.


                                    ARTICLE X

                                  Miscellaneous

     10.1  Nothing  in this Plan  shall  interfere  with or limit in any way the
right of the Company to terminate any Participant's  employment at any time, nor
confer upon a Participant any right to continue in the employ of the Company.

     10.2 In the event the Committee  shall find that a Participant is unable to
care for his or her affairs  because of illness or accident,  the  Committee may
direct that any payment due the  Participant be paid to the duly appointed legal
representative  of the  Participant,  and any such  payment  so made  shall be a
complete discharge of the liabilities of the Plan.

     10.3 The Plan shall be construed and administered  according to the laws of
the State of Ohio.