Ernest Linn Draper Jr. was the president, chief executive officer (CEO), and chair of American Electric Power (AEP), a public utility holding company based in Ohio that serves 11 states. Draper took the reins of the company just as energy deregulation was taking place. He was instrumental in reassuring investors of the company's strength in the wake of the Enron scandal and also kept the company afloat during the 2001-2002 recession.
- Ernest Linn Draper Jr. is the former chair, president, and CEO of American Electric Power.
- Draper distinguished himself by guiding AEP through the aftermath of the Enron scandal and a major blackout in 2003.
- He earned his undergraduate degrees from Rice University and a doctorate from Cornell University.
- Draper is an Eagle Scout and a Distinguished Eagle Scout for his inspiring life work and his dedication to community volunteering.
- He stepped down from AEP in 2004.
Early Life and Education
Ernest Linn Draper Jr. was born in 1942 in Houston, Texas, to Ernest Linn Draper and Marcia L. Saylor. He graduated from Rice University with a bachelor of arts in chemical engineering in 1964 and a bachelor of science in chemical engineering the following year. Draper completed his doctorate in nuclear engineering from Cornell University in 1970.
After graduating from Cornell, Draper taught at the University of Texas at Austin from 1971 until 1979. He then spent 13 years at Gulf States Utilities and worked his way into senior management.
After leaving Gulf States Utilities, E, Linn Draper Jr. joined American Electric Power in 1992 as its president and chief operating officer (COO). A year later, he was promoted and assumed the role of CEO in addition to his duties as company president. He also became chair of the company's board.
The passage of the Energy Policy Act of 1992 deregulated power companies, which lost their status as legal monopolies. After the law took effect, power companies were able to decouple power generation and power sales, allowing for some to focus on trading, such as Enron, and others to focus on generation.
Draper focused on wholesale power generation and pared down the utility's cost structure to get ahead of what were considered industry trends. He also sought to maintain a responsible balance sheet, which served the company well in the aftermath of Enron's implosion and greater scrutiny of the energy industry.
After his reforms, industry analysts gave AEP the all-clear. In its 2003 annual report, AEP reported net income of $110 million, compared with a loss of $519 million the year before. The company's share price increased 11.6% year on year.
Draper led AEP's merger with Central & South West Corp. The deal, which was announced in December 1997, went through in June 2000.
Draper cemented his reputation as a reliable CEO and steward of shareholder value. Not only was this clear during the wake of the Enron scandal, but he also proved this in the decisions he made leading up to the blackout of 2003.
The northeastern United States and parts of Ontario and Quebec suffered their largest blackout ever on Aug. 14, 2003, which impacted an estimated 50 million people. The blackout was reportedly caused by a software bug at FirstEnergy of Akron, Ohio. The bug prevented engineers from redistributing the energy load on overloaded lines.
What could have been a small local blackout turned into a major emergency for millions of people living in Ohio, Michigan, New Jersey, Connecticut, Massachusetts, Vermont, Ontario, and Quebec. Draper's investment in infrastructure, particularly in building buffers in AEP's grid, allowed the company to avoid much of the criticism that other utility companies experienced after the blackout.
On Sept. 4, 2003, he told the House Committee on Energy and Commerce: "From the outset, let me be clear, we did it right. The AEP system held together—a point of pride for us. Our protective systems performed automatically as they were designed to perform, our operators performed and communicated as they should and our load and generation remained in balance throughout the day."
Draper Mary Deborah Doyle in 1962. The couple has four children.
He served on the board of 11 companies listed on the New York Stock Exchange (NYSE), including Alliance Data Systems (which was rebranded as Bread Financial) and NorthWestern Energy (NWE). Draper also served in professional capacities for a number of different organizations, including the American Nuclear Society, the Cornell University Council, and the Board of Governors for the Argonne National Laboratory to name a few.
He is also an Eagle Scout and a Distinguished Eagle Scout, a distinction awarded to Eagle Scouts after twenty-five years of life work and a record of community volunteer work.
Draper stepped down as president and CEO at the end of 2003 and retired from his position as chair in April 2004.