American Electric Power (AEP) and Quanta Services have entered into a long‑term partnership that will enable AEP to execute its $72 billion capital plan and accelerate the deployment of 765 kV and other high‑voltage transmission lines across its 11‑state footprint. The collaboration is designed to improve cost predictability, shorten project delivery times, and reinforce the domestic supply chain for critical grid components.
Under the Cooperation and Commitment Agreement, the two companies will jointly design, engineer, procure, and construct 765 kV transmission facilities and other high‑voltage projects. A separate Development Services Agreement will expand domestic manufacturing of extra‑high‑voltage transformers and circuit breakers, ensuring reliable access to these essential parts as AEP expands its network.
AEP’s capital plan has grown from $54 billion in late 2024 to $72 billion, reflecting a strategic shift to meet projected load growth driven by data‑center and industrial demand. Management projects a 7‑9% long‑term operating‑earnings growth through 2030, with the rate base expected to grow at a 10% compound annual growth rate.
The partnership directly addresses the surge in peak system demand, which AEP forecasts will rise from 37 GW today to 65 GW by 2030. Of that increase, 28 GW is already backed by customer agreements, largely from data‑center operators that require high‑capacity, reliable power.
By focusing on domestic manufacturing of transformers and circuit breakers, the agreement mitigates supply‑chain risk and supports the broader industry trend toward grid modernization and renewable integration. Quanta’s expertise in 765 kV construction and its recent acquisition of Dynamic Systems add mechanical and process capabilities that will accelerate project execution.
Bill Fehrman, AEP’s Chairman, President and CEO, said the partnership “positions the company to deliver solutions to customers with greater speed, schedule certainty and improved costs.” Quanta’s CEO highlighted the company’s record $39.2 billion backlog and strong Q3 2025 results, underscoring its capacity to support AEP’s ambitious expansion.
The market has responded positively to AEP’s expanded capital plan and the partnership, with analysts noting the strategic advantage of a reliable domestic supply chain and the ability to meet the growing data‑center demand. Quanta’s strong earnings and backlog reinforce confidence in its execution capability, even as the broader market remains cautious about valuation levels.
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