The CEO of Kentucky Power’s parent company, American Electric Power (AEP), was reportedly the highest-paid investor-owned utility executive in the United States in 2025, according to a newly released report from the Energy and Policy Institute.
The report states that AEP CEO Bill Fehrman received total compensation valued at approximately $36.6 million in 2025 — reportedly the highest compensation package among utility company CEOs nationwide by what the organization described as a “wide margin.”
According to the report, Fehrman’s compensation increased by roughly $23.3 million over the previous year. The increase was largely tied to stock awards designed to encourage long-term company performance, create shareholder value, and reduce the risk of executive turnover.
The report comes as many Kentucky Power customers across Eastern Kentucky continue dealing with rising utility costs.
Earlier this year, the Kentucky Public Service Commission approved a rate increase for Kentucky Power that will gradually raise residential electric bills over a two-year period. Under the approved increase, the average residential customer using 1,208 kilowatt-hours per month is expected to see their monthly bill rise from approximately $183.37 to $194.13 — an increase of about 6.63 percent.
Kentucky Power had originally requested a significantly larger increase that would have pushed the average monthly residential bill to approximately $210.67, representing a 14.63 percent increase.
In a statement addressing the report, Kentucky Power spokesperson Sarah Lynch said customer rates are determined by the Kentucky Public Service Commission based on the actual cost of providing electric service in Eastern Kentucky, not by executive salaries at AEP.
Lynch also stated that only a small portion of executive compensation is allocated to Kentucky Power and that many executive performance incentives are excluded from customer rates.
She added that rising operational costs, a shrinking customer base, and overall energy usage are the primary factors affecting customer bills.
The report noted that the second-highest compensated utility CEO in the country was Christopher Womack of Atlanta-based Southern Company, whose 2025 compensation was reported at approximately $28.2 million.