...Regulated Low-Risk Business Profile: Indiana Michigan Power Co.'s (IMPCO) Issuer Default Rating (IDR) reflects a low-risk regulated business profile and favorable regulatory environment in Indiana and Michigan, which provide cost recovery riders to cover environmental and power costs. IMPCO's credit metrics are weak for the rating category and a large capital investment program will further strain its credit profile. IMPCO will rely on its parent, American Electric Power Company, Inc. (AEP, BBB/Stable), for financial resources during this period. Large Capex Cycle: The company's coal-fired power plants are subject to stringent environmental regulations. The current capital spending through 2016, including environmental compliance-related capex, will be about $1.4 billion. The extension of the nuclear power plant's life will cost about $1.2 billion, of which $686 million is included in capital spending through 2016. The costs allocable to Indiana are recoverable through a rate rider, while...
