AEP head: Credit default 'unfathomable' for electric power utilities

American Electric Power (AEP) CEO Nicholas Akins finds it “unfathomable” that the U.S. is apparently so close to budget chaos, adding that a potential federal default would have major implications for the electric power sector.

“This industry spends over $90 billion a year” and is very sensitive to the cost of credit, Akins told Bloomberg Television’s ‘Street Smart’ program October 8.

 

“It’s unfathomable that we are actually getting to this point; and for those of us who are heavily capital intensive we are very focused on debt and the cost of debt,” Akins said.

“We have to be concerned about our ability to acquire debt and the cost of that debt,” Akins said.

When asked by the interviewers what advice he would give Senate Majority Leader Harry Reid (D-Nev.) and House Speaker John Boehner (R-Ohio), Akins said: “For the sake of the country get together and get together soon.”

“The brinksmanship that’s occurring” is bad for the national economy in part because large industries need “stability,” Akins said.

With the U.S. government in the second week of a shutdown, the U.S. Congress is looking at an October 17 deadline to increase the nation’s borrowing power or risk default.

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