American Electric Power (AEP), one of the largest electric utilities in the country, reported earnings of $360 million or 89 cents per share for 2009 first quarter, compared to $573 million or $1.43 per share in the same period last year.

The utility's revenue remained flat at $3.5 billion. Earnings were better than forecasted. Analysts expected 81 cents per share, according to a Reuters survey.

AEP said it was maintaining its planned $2.6 billion capital spending in 2009 but has significantly cut its 2010 capital budget to $1.8 billion from a planned $3.4 billion.

Declining demand across the country combined with the lowest natural gas prices in years is significantly impacting the volume and price we can realize for the excess generation we sell into the marketplace, said Michael G. Morris, AEP's CEO in a statement Friday. Additionally, we are seeing declines in industrial usage averaging 15 percent throughout our service area, he added.

AEP provides electricity to about 5 million customers in 11 states.