Appalachian Power issues $1.375B senior secured securitization bonds

What's the deal? Appalachian Power Company, a subsidiary of American Electric Power Company, and its affiliate Appalachian Power Recovery Funding LLC have issued $1.375 billion in Series 2026-A Senior Secured SAC Bonds. The bonds are designed to recover certain securitised asset costs. Law firm Sidley represented both entities in the transaction.

The Sidley team was led by Robert Stephens, George Vlahakos, Mario Samos, and Evan Grosch, spanning energy and infrastructure, tax, capital markets, and investment funds practices.

The signal: Utilities continue to tap bond markets at scale to fund infrastructure recovery and manage costs. The size of this issuance — north of $1.3 billion — reflects strong investor appetite for senior secured utility debt, which is typically seen as a stable, lower-risk asset class. It also signals that large US power companies are leaning on securitisation as a financing tool to smooth out major capital expenditures and pass costs through in a structured way.

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