2011 Annual Report
LIVING OUR PROMISE
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Investor Information
COMMON STOCK AND DIVIDEND INFORMATION
Ameren’s common stock is listed on the New York Stock Exchange
(ticker symbol: AEE). Ameren began trading on January 2, 1998,
following the merger of Union Electric Company and CIPSCO Inc. on
December 31, 1997. Ameren common shareholders of record totaled
63,684 on December 31, 2011. The following table provides the closing
price ranges and dividends paid per Ameren common share during
each quarter of 2011 and 2010.
AEE 2011
Quarter Ended
March 31
June 30
September 30
December 31
AEE 2010
Quarter Ended
March 31
June 30
September 30
December 31
High
Low
Close
$29.14
30.14
31.44
$26.46
27.78
25.55
34.11
27.98
$28.07
28.84
29.77
33.13
Dividends
Paid
38 1⁄2 ¢
38 1⁄2
38 1⁄2
40
High
Low
Close
Paid
Dividends
$28.27
26.92
28.99
$24.14
23.09
23.45
29.89
27.65
$26.08
23.77
28.40
28.19
38 1⁄2 ¢
38 1⁄2
38 1⁄2
38 1⁄2
ANNUAL MEETING
The annual meeting of Ameren Corporation shareholders will convene at
9 a.m. (Central Time), Tuesday, April 24, 2012, at Powell Symphony Hall,
718 North Grand Boulevard, St. Louis, Missouri. The annual shareholder
meetings of Ameren Illinois Company and Union Electric Company will be
held at the same time.
DRPLUS
Any person of legal age or entity, whether or not an Ameren
shareholder, is eligible to participate in DRPlus, Ameren’s dividend
reinvestment and stock purchase plan. Participants can:
(cid:129) make cash investments by check or automatic direct debit to their
bank accounts to purchase Ameren common stock, totaling up to
$120,000 annually,
(cid:129) reinvest their dividends in Ameren common stock (minimum dividend
reinvestment requirement of 10% as of January 1, 2012) or receive
Ameren dividends in cash and
(cid:129) place Ameren common stock certificates in safekeeping and receive
regular account statements.
For more information about DRPlus, you may obtain a prospectus from
Ameren’s Investor Services representatives.
DIRECT DEPOSIT OF DIVIDENDS
All registered Ameren common and Ameren Illinois Company and
Union Electric Company preferred shareholders can have their
cash dividends automatically deposited to their bank accounts. This
service gives shareholders immediate access to their dividend on the
dividend payment date and eliminates the possibility of lost or stolen
dividend checks.
CORPORATE GOVERNANCE DOCUMENTS
Ameren makes available, free of charge through its website
(www.ameren.com), the charters of the board of directors’ audit
and risk committee, human resources committee, nominating
and corporate governance committee, nuclear oversight and
environmental committee, and finance committee. Also available on
Ameren’s website are its corporate governance guidelines, policy
regarding nominations of directors, policy regarding communications
to the board of directors, policy and procedures with respect to
related person transactions, Code of Business Conduct (referred to as
the “Corporate Compliance Policy”) and its Code of Ethics for principal
executive and senior financial officers. These documents are also
available in print, free of charge upon written request, from the Office
of the Secretary, Ameren Corporation, P.O. Box 66149, Mail Code 1370,
St. Louis, MO 63166-6149. Ameren also makes available, free of charge
through its website, the company’s annual reports on SEC Form 10-K,
quarterly reports on SEC Form 10-Q, and its current reports on SEC
Form 8-K, including any chief executive officer and chief financial
officer certifications required to be filed with the Securities and
Exchange Commission therewith.
ONLINE STOCK ACCOUNT ACCESS
Ameren’s website (www.ameren.com) allows registered shareholders
to access their account information online. Shareholders can
securely change their reinvestment options, view account summaries,
receive DRPlus statements and more through the website. This is a
free service.
INVESTOR SERVICES
Ameren’s Investor Services representatives are available to help
you each business day from 8:00 a.m. to 4:00 p.m. (Central Time).
Please write or call:
Ameren Services Company, Investor Services
P.O. Box 66887
St. Louis, MO 63166-6887
314-554-3502
800-255-2237
invest@ameren.com
TRANSFER AGENT, REGISTRAR AND PAYING AGENT
The Transfer Agent, Registrar and Paying Agent for Ameren common
stock and Ameren Illinois Company and Union Electric Company
preferred stock is Ameren Services Company.
Ameren Corporation
One Ameren Plaza
1901 Chouteau Avenue
St. Louis, MO 63103
314-621-3222
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01
At home. At work. At play.
Ameren serves 2.4 million electric and more than 900,000 natural gas
customers in Illinois and Missouri, providing the electricity and natural
gas that are vitally important to our economy and our way of living.
That’s why Focused Energy. For Life. is the promise we make to you.
Ameren is committed to ensuring that the energy our customers need
is there when they need it—now, and for life.
Through strong shareholder returns, great customer service and
giving back to our local communities, we work to build value for all.
Contents
03 Letter to Shareholders
06 Leading Today
12 Leading The Way
18 Financial Highlights
20 Offi cers and Directors
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Ameren is leading the way–
making decisions today that
will produce future results for
our shareholders, customers
and co-workers.
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03
OUR PROMISE
TO SHAREHOLDERS...
My fellow shareholders,
The world of energy is rapidly changing. In 2011, we showed that Ameren is
capable of not only weathering a challenging business climate, but also of
leading the way—making decisions today that will produce future results for
our shareholders, customers and co-workers.
Enhancing Shareholder Value
The actions we took in 2011 refl ect our fi rm commitment to delivering long-term total
shareholder returns in the top half of our industry peer group. We plan to accomplish
this by improving the earned returns in our regulated business segments, investing
capital in a disciplined manner, and tightly managing our cash fl ows. In 2011, we
invested more than $1 billion primarily in new regulated utility infrastructure,
generating enough cash from operations to fund these investments and the common
stock dividend while also reducing outstanding borrowings. In October, the Board
of Directors declared a quarterly dividend of 40 cents per share. This represented an
increase of 3.9 percent and demonstrates our understanding that you expect dividend
growth. The resulting annualized equivalent rate of $1.60 per share is well covered by
earnings and cash fl ows from our regulated business segments.
We continue to pursue a disciplined approach to investing. We are moving forward
with plans to build more than $1.2 billion in regional electric transmission projects. In
December, these projects were approved by the Midwest Independent Transmission
System Operator. Customers will benefi t from improved electric system reliability and
effi ciency, and these Federal Energy Regulatory Commission-regulated projects are
expected to earn timely and fair returns for shareholders.
Our investment discipline is also evident at our merchant generation business,
Ameren Energy Resources. In 2011, we closed two older energy centers and refi ned
our environmental compliance strategy. These actions enabled us to reduce expected
capital expenditures, through 2015, by a total of $270 million from prior plans. In 2012,
low wholesale power prices persist, and the timing of required compliance with new
federal air emission rules is uncertain. As a result, our merchant generation business
further reduced environmental capital expenditure plans—delaying the construction of
environmental equipment at our Newton and Edwards energy centers. We continue to
work hard to position our low-cost coal-fi red merchant generation fl eet to weather the
current period of low power prices and advocate for fair regulatory and power market
policies that will enhance its value.
Ameren’s Executive Leadership Team:
(left to right) Scott A. Cisel, Warner L. Baxter, Charles D. Naslund, Daniel F. Cole,
Thomas R. Voss, Adam C. Hefl in, Martin J. Lyons, Jr., Gregory L. Nelson,
Maureen A. Borkowski, Richard J. Mark, Michael L. Moehn, and Steven R. Sullivan.
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04
Modernizing Illinois and Missouri Regulatory Frameworks
Our company plays a pivotal role in fueling our regional economy. We provide competitive
rates and reliable service, fostering growth. In addition, we are positioned to create jobs and
spur economic growth by investing in needed 21st-century energy infrastructure. However,
to modernize our infrastructure we need modernized 21st-century regulatory frameworks
that provide timely cost recovery and reasonable opportunities to earn fair returns on these
investments.
I’m pleased to report we made signifi cant progress in improving our Illinois regulatory
framework in 2011. In October, the Energy Infrastructure Modernization Act was enacted
into law, which allows for performance-based formula ratemaking in Illinois. This law is a
win for the state and customers who will enjoy enhanced reliability and a more predictable
electric delivery rate-setting framework. This law provides utilities with timely recovery of
costs and an improved opportunity to earn fair returns on investment. As a result, Ameren
Illinois expects to invest an additional $625 million in system upgrades and Smart Grid
modernization projects over the next decade, creating an additional 450 jobs during the peak
program years.
In Missouri, we continue to explore options to reduce regulatory lag and enable much-needed
infrastructure improvements. Regulatory lag results from a framework that uses out-of-date
cost and investment levels to establish rates. In July 2011, the Public Service Commission
approved a $173 million increase in electric rates. Importantly, this decision included recovery
of air emission reduction “scrubber” technology at our Sioux Energy Center, and it maintained
key cost-recovery mechanisms. By the end of the year, we completed a voluntary retirement
program that will help align spending with current rate levels and economic conditions.
Achieving Operational Excellence and Innovation
Also in 2011, Ameren continued its focus on operational excellence. Not only did my
co-workers increase effi ciencies in Ameren’s day-to-day business, but they also pursued
innovative ideas to benefi t all stakeholders.
A prime example is Ameren Missouri’s new, long-term contract with Peabody Energy. As
part of a proactive business strategy to meet federal emissions rules, our Missouri utility
will purchase 91 million tons of ultra-low-sulfur coal—allowing us to defer signifi cant
environmental expenditures. We will improve air quality at a dramatically lower cost to
customers, who otherwise might have shouldered near-term electric rate increases of up
to 20 percent.
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05
Other operational highlights include:
(cid:129) The second-longest continuous run of Ameren Missouri’s Callaway Energy Center.
In October, the nuclear energy center refueled after operating continuously for nearly
500 days. This uninterrupted operation between refuelings resulted in lower costs, with a
sustained source of clean power for customers.
(cid:129) Generation records set at coal-fi red energy centers. In an industry where reliability
is critical, our energy centers are performing at all-time levels. This year, two of our
merchant generation energy centers achieved milestones—with Duck Creek setting an
all-time monthly generation record and Coffeen joining the “gigawatt club” by producing
more than 1,000 megawatts for an entire hour for the fi rst time ever. In addition, Ameren
Missouri’s Meramec Energy Center operated a record 292 days without interruption, and
in September, Labadie Energy Center was recognized by Navigant Consulting with an
operational excellence award based on performance from 2006 to 2010.
(cid:129) Completion of a supply chain optimization program. Ameren evaluated inventory levels
across the system, thereby reducing purchasing needs. In three years, this program has
achieved $35 million in savings, with more to come.
(cid:129) Consolidation of electric and natural gas billing for customers formerly served by different
Illinois legacy companies. We continue to generate increased effi ciencies and customer
convenience after merging AmerenCIPS, AmerenCILCO and AmerenIP into one entity,
Ameren Illinois, in 2010.
In support of operational excellence, our dedicated workforce maintains a fundamental
commitment to both physical and cyber safety—ensuring attention to safety in all aspects of
our work and protecting our company against data threats.
Ameren’s keen focus on operations bolsters
our fi nancial performance
Realizing Our Vision
The news I’ve shared here is just a glimpse of our progress in 2011. I invite you to learn
more by reviewing this report and by attending our Annual Meeting in St. Louis at Powell
Symphony Hall at 9 a.m. on April 24, 2012.
Ours is a dynamic industry, so my colleagues and I are committed to transparency: sharing
with you the opportunities we enjoy, the challenges we face and the plans we have in place to
support our vision of Leading the way to a secure energy future.
At Ameren, we carefully craft our culture so that every employee understands his or her
role in realizing that vision. I believe that by educating all stakeholders about our focus, we
improve understanding of our company and increase the opportunity to engage in meaningful
conversations that result in smarter decisions about energy in our region—today, and for
years to come.
Sincerely,
Thomas R. Voss
Chairman, President and Chief Executive Offi cer, Ameren Corporation
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Energy powers our lives and
our economy. We’re focused
on keeping the lights on and
gas fl owing–today and for
generations to come.
Jeff Coyle, manager, Coffeen Energy Center, walks the turbine deck with
M.C. King, shift supervisor. The editors of Power Engineering magazine
recognized Coffeen’s scrubber project as one of the top three best coal-fi red
projects at its December international conference. By installing high-tech
scrubbers, Ameren is removing more than 95 percent of sulfur dioxide
emissions to provide cleaner power.
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07
LEADING
TODAY...
Being focused means keeping the lights on and gas fl owing, while forming
powerful connections with people.
Here’s a look at recent progress across our 64,000-square-mile service territory.
Cleaner, Smarter, Safer Infrastructure
With our lives “plugged in” like never before, reliability is core to delivering on
our promise that the energy you need will be there when you need it—today
and for generations to come. And that promise starts at the source—our energy
centers. To provide cleaner power, Ameren installed “scrubbers” at our Sioux,
Coffeen and Duck Creek energy centers—removing more than 95 percent of
sulfur dioxide emissions.
Getting that power to growing areas requires strong infrastructure. In 2011,
progress continued on a $63 million high-voltage transmission line project into
the northernmost reaches of Ameren Illinois’ service territory to meet growing
customer needs.
And new distribution system automation means we can fi nd and fi x outages
faster. Our automated substation circuits in Maryland Heights, Mo., attracted
the attention of the entire industry as a showcase of “smart grid” in action. Our
Decatur, Ill., area substations are now linked to smart devices that can sense
and stop interruptions. Thanks to these projects and others like them, Ameren
customers enjoy better reliability.
On the natural gas side of the business, we continually monitor system
integrity across our 21,400 miles of natural gas pipeline.
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08
RESPONSIVE
Warner Baxter, president
and CEO, Ameren
Missouri, left, explains the
company’s rapid response
and restoration efforts
to Missouri Gov. Jay
Nixon after a tornado tore
through Sunset Hills, Mo.
A Powerful Force
Every utility system, no matter how reliable, is subject to unpredictable weather
events. Our crews were well prepared to be a powerful counterforce to nature’s
destruction in 2011. On Jan. 1, Ameren Missouri crews rapidly responded after a
tornado touched down in Sunset Hills, Mo. The combination of wind and ice can
also wreak havoc on exposed lines. In February, Illinois was sheathed in ice, and
the state’s Commerce Commission publicly commended Ameren Illinois’ structured
preparation and swift restoration of service.
Only two months later, an EF-4 tornado tore through north St. Louis County.
Ameren Missouri worked around the clock through the devastation, and later
received recognition from the St. Louis County Council for its restoration work
amid the area’s worst tornado in four decades.
Our support extends beyond restoring power. In August, Ameren presented an
$84,000 check to the American Red Cross for disaster relief. The donation included
employee and corporate gifts for the Japanese tsunami, the north St. Louis County
tornado and the Joplin, Mo., tornado.
Helping Customers Make Smart Choices
At Ameren, we believe that customer education is an important responsibility and a
vital component of our business.
In June, we opened an Energy Learning Center at our St. Louis headquarters. Here,
tour groups can meet experts and learn about a variety of topics, including renew-
able power, energy effi ciency and environmental upgrades throughout our system.
To complement our physical learning center, Ameren also offers a virtual library
of current and emerging topics, available at AmerenMissouri.com/energyadvisor.
Customers can also speak with an expert by phone. As the world of energy
changes, our employees will lead the way.
Customers go to our ActOnEnergy.com website to take advantage of our energy
effi ciency programs. In 2011, more than 125,000 children learned about energy
safety and conservation because Illinois teachers took advantage of our free,
web-based Kids Act On Energy program.
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09
RELIABLE
Small businesses, such as
PW Pizza in St. Louis, are the
backbone of our economy.
Ameren keeps them up
and running with reliable
and affordable power. Our
customers know they can count
on us to make sure the energy
they need is there when they
need it–now and in the future.
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SUPPORTIVE
Our employees strengthen the
communities in which they live
and work by volunteering and
giving back. Strong communities
foster better school systems,
encourage business investment,
and generate economic growth.
In 2011, our employees gave
back and volunteered more than
100,000 hours throughout our
service territory.
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11
COMMITTED
In 2011, Ameren won a
prestigious Employer
Support Freedom Award
from the U.S. Defense
Department. GI Jobs
magazine named the
company one of the
nation’s top 100 military-
friendly employers for the
third year in a row.
Shining a Light on What Matters
Our employees believe in leading by example—contributing time and talent to
worthy causes.
Making our communities better places to live
2011 was a banner year for volunteerism, with thousands of Ameren co-workers
building low-income housing, delivering meals and working with veterans—to
name just a few activities. On Oct. 15, Ameren held our very fi rst Community
Connections Day; in less than 24 hours, employees and their friends and families
gave nearly 390 hours of time at 10 different locations in Illinois and Missouri.
Supporting those who serve
We are honored to employ hundreds of veterans. In 2011, Ameren received the
U.S. Secretary of Defense Employer Support Freedom Award, the Defense
Department’s highest honor for companies that demonstrate extraordinary support
of employees serving in the Guard and Reserve. Also, GI Jobs magazine named
Ameren one of the nation’s top 100 military-friendly employers for the third year
in a row.
Offering energy assistance
This year, Ameren made an unprecedented commitment of $5 million to customer
assistance programs, including $1 million for military personnel. In today’s economy,
people are fi nding they need extra help, so our utilities have improved access to
such programs.
Committed to Diversity
Ameren is a Fortune 500 company, and our actions can have lasting impact. As
a major purchaser of goods and services, we have built an aggressive program
to give qualifi ed diverse suppliers the opportunity to work with us. In 2011,
DiversityBusiness.com named Ameren a Top 50 Organization for Multicultural
Business Opportunities.
Ameren turns to local colleges and universities to build our next-generation
workforce. In 2011, we partnered with the Missouri University of Science and
Technology to establish the Ameren Diversity Scholars Program, designed to
recruit female and minority students into engineering and computer science.
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12
LEADING
THE WAY...
Ameren is more than an energy company—we’re a catalyst for growth and a
resource for life. We’re planning now to meet the needs of future generations.
An Economic Engine
To thrive, our region needs affordable energy and modern infrastructure.
In independent studies of Ameren’s operating companies, it was determined
that the annual average economic impact on our service area was more than
$6.5 billion, and we support more than 38,000 direct and indirect jobs. With
constructive regulatory frameworks in place that support investment, we
can do even more.
Transmission takes off
Ameren is well positioned at the nation’s crossroads, so our newest
subsidiary, Ameren Transmission Company (ATX), has a unique opportunity
to strengthen the transmission system our country depends on and provide
Ameren with a new avenue of earnings growth.
In December, a trio of projects received approval from the Midwest
Independent Transmission System Operator—clearing ATX to invest more
than $1.2 billion and create many new construction, supplier and other jobs.
These projects will enhance reliability, make our region more attractive
to industries, and help us incorporate renewable power sources.
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Ameren is more than an
energy company–we’re
a catalyst for growth and a
resource for life. And we’re
planning now to meet the
needs of future generations.
Rodney Hilburn, substation
maintenance construction
supervisor, Ameren Illinois,
operates the latest in
Smart Grid technology.
This technology allows the
company to remotely control
substation switches to quickly
isolate damage and, in many
cases, automatically restore
power by switching to an
alternate supply.
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14
DRIVING GROWTH
Ameren’s economic
development team offers
companies vital services like
site selection, workforce
analysis and economic
data. The team helps local
communities attract employers
like Pioneer Hi-Bred, which
selected New Madrid County,
Mo., to build its new soybean
production plant. The plant
opened in 2011.
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15
PROACTIVE
One of the keys to the
success of electric
vehicles is access to
abundant, safe and
reliable electricity.
We are working to ensure
that our system is ready
if these vehicles are
widely adopted in the
future. Employees have
been driving three Chevy
Volts to better understand
the cost, charging time,
equipment needed and
overall economics of
electric vehicles.
MAP to the future
With performance-based formula ratemaking approved in Illinois, Ameren
Illinois has developed a Modernization Action Plan (MAP) to guide our Smart
Grid improvements for the next 10 years. This will ensure a more secure delivery
system that benefi ts customers, co-workers, investors and the environment.
Dedicated development
Ameren has a dedicated economic development team to attract and retain
strong employers. Last year, our efforts helped draw more than $1.8 billion in
investment to the area, along with some 4,000 jobs. The health of our region is
critical to our success.
For such outstanding efforts, in September, our company was named a Top 10
Utility in Economic Development by Site Selection magazine.
Your Resource for What’s Next
We think a 21st-century energy provider should provide more than energy. We
should offer answers. That means staying ahead of technologies and helping people
understand them.
Solar power
At Ameren’s headquarters, our engineers are comparing four types of solar
technologies. Our rooftop installation is the largest of its kind in the state. To share
our knowledge with customers, we created a microsite—AmerenSolar.com—that
includes real-time data about solar performance in our area.
Electric vehicles
In 2011, our co-workers got fi rst-hand experience with a prototype of Mitsubishi’s
i-MiEV sedan, and our fl eet added fi ve plug-in hybrid electric trucks and
charging stations. Employees are driving three Chevy Volts—two in Missouri and
one in Illinois—as part of an industry research demonstration. We’re prepared to
help the public get “plug-in ready.” Customers can learn more and even request a
free readiness assessment of their home or business at Ameren.com.
Ameren is also participating in a regional Department of Energy task force concep-
tualizing how public charging infrastructure might take shape in the Midwest.
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16
INNOVATIVE
An inside look at two of
the three Ameren Missouri
Maryland Heights Renewable
Energy Center turbines.
Capturing landfi ll methane
gas to generate electricity is
one the most cost-effective
renewable energy resources
we are building to serve our
customers.
Generations Ahead
We promise to be there when our customers fl ip the switch or adjust the
thermostat. At Ameren, we’re planning ahead to ensure that our customers’
kids and grandkids enjoy abundant, reliable energy.
Trash to electricity
Ameren Missouri will bring its Maryland Heights Renewable Energy
Center online in 2012. Using methane gas from a landfi ll to generate
electricity, this innovative facility will be among the largest of its kind
in the nation—offering a reliable, local source of energy that can power
10,000 homes.
Integrated Resource Plan
In 2011, Ameren Missouri fi led a comprehensive plan assessing the
region’s generation needs for the next 20 years. We know that meeting
the region’s needs takes a combination of energy sources, and our team is
committed to fi nding the right balance. A copy of this plan is available at
AmerenMissouri.com.
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17
Bill Barbieri, manager,
Renewable Energy, Ameren
Missouri, stands on the site
of the Maryland Heights
Renewable Energy Center.
The facility will turn methane
gas from a landfi ll into
electricity. Barbieri is leading
Ameren Missouri’s charge
to build a diverse renewable
energy portfolio.
FORWARD LOOKING
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18
Financial Highlights
AMEREN CONSOLIDATED
(In millions, except per share amounts and as noted)
RESULTS OF OPERATIONS
Operating revenues
Operating expenses
Operating income
Net income attributable to Ameren Corporation
COMMON STOCK DATA
Earnings per basic and diluted share
Dividends per common share
Dividend yield (year-end)
Market price per common share (year-end closing)
Shares outstanding (weighted average)
Total market value of common shares (year-end)
Book value per common share
BALANCE SHEET DATA
Property and plant, net
Total assets
Long-term debt obligations, excluding current maturities
Capitalization ratios
Common equity
Preferred stock, not subject to mandatory redemption
Debt and preferred stock subject to mandatory redemption, net of cash
OPERATING DATA
Total electric sales (kilowatt-hours)
Native natural gas sales (decatherms in thousands)
Total generation output (kilowatt-hours)
Electric customers
Natural gas customers
Year Ended December 31,
2011
2010
2009
$7,531
$6,290
$1,241
$519
$2.15
$1.555
4.7%
$33.13
241.5
$8,037
$32.64
$18,127
$23,645
$6,677
53.4%
1.0%
45.6%
111,299
92,829
77,917
2.4
0.9
$7,638
$6,722
$916
$139
$0.58
$1.540
5.5%
$28.19
238.8
$6,777
$32.15
$17,853
$23,511
$6,853
51.3%
0.9%
47.8%
111,887
103,012
77,698
2.4
0.9
$7,135
$5,719
$1,416
$612
$2.78
$1.540
5.5%
$27.95
220.4
$6,635
$33.08
$17,610
$23,702
$7,111
50.3%
1.3%
48.4%
104,062
107,647
76,239
2.4
0.9
40750_PB_txt.indd 18
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19
Electrical Generating Capacity
(Expected for 2012 summer peak)
5,500
megawatts of merchant
generating capacity
3,300,000
electric and natural gas customers
2,400,000
electric customers
900,000
natural gas customers
10,400
megawatts of
Ameren Missouri
generating capacity
Peoria
St. Louis
Collinsville
Company Headquarters
Subsidiary Headquarters
Electric Service Territory
Electric and Natural Gas
Service Territory
Ameren companies serve approximately
2.4 million electric and more than 900,000
natural gas customers over 64,000 square
miles in Illinois and Missouri. Our service
territory includes a diverse base of residential,
commercial and large industrial customers in
both urban and rural areas. In Missouri, we
operate primarily as a traditional, rate-regulated
electric and natural gas utility with approximately
10,400 megawatts of generating capacity. Our
Illinois operations include rate-regulated electric
and natural gas transmission and distribution
businesses. Ameren’s merchant generation
business includes several coal-fi red plants and
multiple natural gas-fi red units with a capacity
of approximately 5,500 megawatts of generation.
Ameren Missouri is the largest electric utility
in the state, while Ameren Illinois ranks as the
second largest electric distributor and one of the
largest natural gas distributors in Illinois.
1.0%
Preferred Stock
Residential Rates
(Cents per kilowatt-hour at June 2011)
Capitalization
(December 31, 2011)
U.S. Average
Ameren Illinois
Ameren Missouri
U.S. Average
Ameren Illinois
Ameren Missouri
12.07¢
10.26 ¢
8.38 ¢
Commercial Rates
(Cents per kilowatt-hour at June 2011)
10.19 ¢
8.38 ¢
6.85 ¢
Source: Summer 2011 EEI Typical Bills and Average Rates Report
53.4%
Equity
45.6%
Debt
40750_PB_txt.indd 19
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2/27/12 1:43 PM
2/27/12 1:43 PM
Ameren Corporation and Subsidiaries Offi cers and Directors
20
EXECUTIVE LEADERSHIP TEAM
Thomas R. Voss
Chairman, President and
Chief Executive Officer,
Ameren Corporation
Warner L. Baxter*
Chairman, President and
Chief Executive Officer,
Ameren Missouri
Scott A. Cisel*
Chairman, President and
Chief Executive Officer,
Ameren Illinois
OTHER OFFICERS
Daniel F. Cole*
Chairman, President
and Chief Executive Officer,
Ameren Services
Steven R. Sullivan*
Chairman, President and
Chief Executive Officer, Ameren
Energy Resources; Chairman and
President, Ameren Energy Generating;
and President and Chief Executive
Officer, Ameren Energy Marketing
Maureen A. Borkowski*
Chairman, President and
Chief Executive Officer,
Ameren Transmission Company
Adam C. Heflin*
Senior Vice President and Chief
Nuclear Officer, Ameren Missouri
Martin J. Lyons, Jr.
Senior Vice President and Chief
Financial Officer, Ameren Corporation
Richard J. Mark*
Senior Vice President, Customer
Operations, Ameren Missouri
Michael L. Moehn*
Senior Vice President, Customer
Operations, Ameren Illinois
Charles D. Naslund*
Senior Vice President, Generation and
Environmental Projects, Ameren Missouri
Gregory L. Nelson
Senior Vice President, General Counsel and
Secretary, Ameren Corporation
Lynn M. Barnes*
Vice President, Business Planning
and Controller, Ameren Missouri
Mark J. Eacret*
Vice President, Business Services and
Controller, Ameren Energy Resources
Michael G. Mueller*
Vice President, Energy Trading and
Fuel Commodities, Ameren Missouri
Shawn E. Schukar*
Senior Vice President, Trading and
Marketing, Ameren Energy Marketing
Jerre E. Birdsong
Vice President and Treasurer,
Ameren Corporation
Mark C. Birk*
Senior Vice President, Corporate
Planning and Business Risk
Management, Ameren Services
S. Mark Brawley*
Vice President, Internal Audit,
Ameren Services
Kendall D. Coyne*
Vice President, Tax, Ameren Services
Kevin A. DeGraw*
Vice President, Enterprise Risk and
Project Management, Ameren Services
Fadi M. Diya*
Vice President, Nuclear Operations,
Ameren Missouri
Scott A. Glaeser*
Vice President, Gas Transmission and
Supply, Ameren Services
Mary P. Heger*
Vice President, Information Technology
and Ameren Services Center,
Ameren Services
Craig D. Nelson*
Senior Vice President,
Regulatory Affairs and Financial
Services, Ameren Illinois
Stan E. Ogden*
Vice President, Customer Service and
Metering Operations, Ameren Illinois
David R. Hunt*
Vice President, Corporate
Communications, Ameren Services
Ronald D. Pate*
Vice President, Operations and
Technical Services, Ameren Illinois
Christopher A. Iselin*
Vice President, Generation,
Ameren Energy Resources
Joseph M. Power*
Vice President, Federal Legislative and
Regulatory Affairs, Ameren Services
Stephen M. Kidwell*
Vice President, Corporate Planning,
Ameren Services
Cleveland O. Reasoner*
Vice President, Engineering, Callaway
Nuclear Plant, Ameren Missouri
Mark C. Lindgren*
Vice President, Human Resources,
Ameren Services
David J. Schepers*
Vice President, Energy Delivery
Technical Services, Ameren Missouri
James A. Sobule*
Vice President and Deputy General
Counsel, Ameren Services
Bruce A. Steinke
Vice President and Controller,
Ameren Corporation
David N. Wakeman*
Vice President, Energy Delivery-
Distribution Services, Ameren Missouri
Dennis W. Weisenborn*
Vice President, Supply Services,
Ameren Services
D. Scott Wiseman*
Vice President, External Affairs,
Ameren Illinois
Warren T. Wood*
Vice President, Regulatory and
Legislative Affairs, Ameren Missouri
Michael L. Menne*
Vice President, Environmental Services,
Ameren Services
BOARD OF DIRECTORS
Stephen F. Brauer 2, 4
Chairman and Chief Executive Officer,
Hunter Engineering Company
Dr. Gayle P. W. Jackson 4, 5
President and Chief Executive Officer,
Energy Global, Inc.
Catherine S. Brune 2, 5
President Eastern Territory,
Allstate Insurance Company
James C. Johnson 3, 4
General Counsel,
Loop Capital Markets, LLC
Ellen M. Fitzsimmons 2, 4
Senior Vice President of Law and Public
Affairs, General Counsel and Corporate
Secretary, CSX Corporation
Walter J. Galvin 1, 2
Vice Chairman,
Emerson Electric Co.
Steven H. Lipstein 1, 3
President and Chief Executive Officer,
BJC HealthCare
Patrick T. Stokes 1, 3, 6
Former Chairman,
Anheuser-Busch Companies, Inc.
* Officer of an Ameren Corporation subsidiary only
Thomas R. Voss
Chairman, President and
Chief Executive Officer,
Ameren Corporation
Stephen R. Wilson 1, 5
Chairman, President and
Chief Executive Officer,
CF Industries Holdings, Inc.
Jack D. Woodard 3, 5
Retired Executive Vice President
and Chief Nuclear Officer, Southern
Nuclear Operating Company, Inc.
1 Member of the Finance Committee
2 Member of the Audit and Risk
Committee
3 Member of the Human Resources
Committee
4 Member of the Nominating and
Corporate Governance Committee
5 Member of the Nuclear Oversight and
Environmental Committee
6
Lead Director
40750_PB_txt.indd 20
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(X) Annual report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
for the fiscal year ended December 31, 2011
OR
( ) Transition report pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934 for the
transition period from
to
.
Commission
File Number
1-14756
1-2967
1-3672
333-56594
Exact name of registrant as specified in its charter;
State of Incorporation;
Address and Telephone Number
Ameren Corporation
(Missouri Corporation)
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
Union Electric Company
(Missouri Corporation)
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
Ameren Illinois Company
(Illinois Corporation)
300 Liberty Street
Peoria, Illinois 61602
(309) 677-5271
Ameren Energy Generating Company
(Illinois Corporation)
1500 Eastport Plaza Drive
Collinsville, Illinois 62234
(618) 343-7700
IRS Employer
Identification No.
43-1723446
43-0559760
37-0211380
37-1395586
Securities Registered Pursuant to Section 12(b) of the Act:
The following security is registered pursuant to Section 12(b) of the Securities Exchange Act of 1934 and is listed on the
New York Stock Exchange:
Registrant
Ameren Corporation
Securities Registered Pursuant to Section 12(g) of the Act:
Registrant
Union Electric Company
Ameren Illinois Company
Title of each class
Common Stock, $0.01 par value per share
Title of each class
Preferred Stock, cumulative, no par value, stated value $100
per share
Preferred Stock, cumulative, $100 par value per share
Depository Shares, each representing one-fourth of a share
of 6.625% Preferred Stock, cumulative, $100 par value per
share
Ameren Energy Generating Company does not have securities registered under either Section 12(b) or 12(g) of the
Securities Exchange Act of 1934.
Indicate by checkmark if each registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
Yes
Yes
Yes
Yes
(X)
( )
( )
( )
No
No
No
No
( )
(X)
(X)
(X)
Indicate by checkmark if each registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
Yes
Yes
Yes
Yes
( )
( )
( )
(X)
No
No
No
No
(X)
(X)
(X)
( )
Indicate by checkmark whether the registrants: (1) have filed all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) have been subject to such filing requirements for the past 90 days.
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company (1)
Yes
Yes
Yes
Yes
(X)
(X)
(X)
( )
No
No
No
No
( )
( )
( )
(X)
(1) As indicated above, Ameren Energy Generating Company is not required to file reports under the Securities
Exchange Act of 1934. However, Ameren Energy Generating Company has filed all Exchange Act reports for the
preceding 12 months.
Indicate by checkmark whether each registrant has submitted electronically and posted on its corporate website, if any,
every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such
files).
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
Yes
Yes
Yes
Yes
(X)
(X)
(X)
(X)
No
No
No
No
( )
( )
( )
( )
Indicate by checkmark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§ 229.405 of this
chapter) is not contained herein, and will not be contained, to the best of each registrant’s knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
(X)
( )
(X)
(X)
Indicate by checkmark whether each registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a
smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in
Rule 12b-2 of the Exchange Act.
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
Large
Accelerated
Filer
(X)
( )
( )
( )
Accelerated
Filer
( )
( )
( )
( )
Non-accelerated
Filer
( )
(X)
(X)
(X)
Smaller
Reporting
Company
( )
( )
( )
( )
Indicate by checkmark whether each registrant is a shell company (as defined in Rule 12b-2 of the Act).
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
Yes
Yes
Yes
Yes
( )
( )
( )
( )
No
No
No
No
(X)
(X)
(X)
(X)
As of June 30, 2011, Ameren Corporation had 241,586,534 shares of its $0.01 par value common stock outstanding. The
aggregate market value of these shares of common stock (based upon the closing price of the common stock on the New York
Stock Exchange on that date) held by nonaffiliates was $6,967,355,641. The shares of common stock of the other registrants
were held by affiliates as of June 30, 2011.
The number of shares outstanding of each registrant’s classes of common stock as of January 31, 2012, was as follows:
Ameren Corporation
Union Electric Company
Ameren Illinois Company
Ameren Energy Generating Company
Common stock, $0.01 par value per share: 242,634,742
Common stock, $5 par value per share, held by Ameren
Corporation (parent company of the registrant):
102,123,834
Common stock, no par value, held by Ameren
Corporation (parent company of the registrant):
25,452,373
Common stock, no par value, held by Ameren Energy
Resources Company, LLC (parent company of the
registrant and subsidiary of Ameren
Corporation): 2,000
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the definitive proxy statement of Ameren Corporation and portions of the definitive information statements of
Union Electric Company and Ameren Illinois Company for the 2012 annual meetings of shareholders are incorporated by
reference into Part III of this Form 10-K.
Ameren Energy Generating Company meets the conditions set forth in General Instruction I(1)(a) and (b) of Form 10-K
and is therefore filing this form with the reduced disclosure format allowed under that General Instruction.
OMISSION OF CERTAIN INFORMATION
This combined Form 10-K is separately filed by Ameren Corporation, Union Electric Company, Ameren Illinois Company
and Ameren Energy Generating Company. Each registrant hereto is filing on its own behalf all of the information contained in
this annual report that relates to such registrant. Each registrant hereto is not filing any information that does not relate to
such registrant, and therefore makes no representation as to any such information.
TABLE OF CONTENTS
GLOSSARY OF TERMS AND ABBREVIATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Forward-looking Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART I
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.
Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
General
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Business Segments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rates and Regulation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transmission and Supply of Electric Power
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power Generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural Gas Supply for Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industry Issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Available Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Risk Factors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unresolved Staff Comments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Mine Safety Disclosures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Executive Officers of the Registrants (Item 401(b) of Regulation S-K) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART II
Item 5.
Item 6.
Item 7.
Item 7A.
Item 8.
Item 9.
Item 9A.
Item 9B.
PART III
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Market for Registrants’ Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selected Financial Data. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Management’s Discussion and Analysis of Financial Condition and Results of Operations . . . . . . . . . . .
Overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liquidity and Capital Resources . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Outlook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Regulatory Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounting Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Effects of Inflation and Changing Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Financial Statements and Supplementary Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Selected Quarterly Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure . . . . . . . . . .
Controls and Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Directors, Executive Officers and Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Executive Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder
Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Certain Relationships and Related Transactions and Director Independence . . . . . . . . . . . . . . . . . . . . .
Principal Accounting Fees and Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
PART IV
Exhibits and Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 15.
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EXHIBIT INDEX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Page
1
4
5
5
6
6
10
11
14
14
15
17
17
24
24
26
27
27
29
31
32
32
34
51
66
70
70
72
73
79
168
169
169
170
170
171
171
172
172
172
177
181
This report contains “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of
1934, as amended. Forward-looking statements should be read with the cautionary statements and important factors included
on pages 4 and 5 of this report under the heading “Forward-looking Statements.” Forward-looking statements are all
statements other than statements of historical fact, including those statements that are identified by the use of the words
“anticipates,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” and similar expressions.
We use the words “our,” “we” or “us” with respect to certain information that relates to all Ameren Companies, as defined
below. When appropriate, subsidiaries of Ameren are named specifically as we discuss their various business activities.
GLOSSARY OF TERMS AND ABBREVIATIONS
2007 Illinois Electric Settlement Agreement – A
comprehensive settlement of issues in Illinois arising out of
the end of ten years of frozen electric rates, effective
January 2, 2007. The settlement, which became effective in
2007, was designed to avoid new rate rollback and freeze
legislation and legislation that would impose a tax on
electric generation in Illinois. The settlement addressed the
issue of power procurement, and it included a
comprehensive rate relief and customer assistance
program.
2010 Credit Agreements – The 2010 Genco Credit
Agreement, the 2010 Illinois Credit Agreement, and the
2010 Missouri Credit Agreement, collectively.
2010 Genco Credit Agreement – Ameren’s and Genco’s
$500 million multiyear senior unsecured revolving credit
facility, which expires on September 10, 2013.
2010 Illinois Credit Agreement – Ameren’s and Ameren
Illinois’ $800 million multiyear senior unsecured credit
agreement, which expires on September 10, 2013.
2010 Missouri Credit Agreement – Ameren’s and Ameren
Missouri’s $800 million multiyear senior unsecured
revolving credit facility, which expires on September 10,
2013.
AER – Ameren Energy Resources Company, LLC, an
Ameren Corporation subsidiary that consists of non-rate-
regulated operations, including Genco, AERG, Marketing
Company and Medina Valley. The Medina Valley energy
center was sold in February 2012. On October 1, 2010,
AERG stock was distributed to Ameren, which then
contributed it to AER, thereby making AERG a subsidiary of
AER.
AERG – AmerenEnergy Resources Generating Company, a
CILCO subsidiary until October 1, 2010, that operates a
merchant electric generation business in Illinois. On
October 1, 2010, AERG stock was distributed to Ameren
and subsequently contributed by Ameren to AER, which
resulted in AERG becoming a subsidiary of AER.
AFS – Ameren Energy Fuels and Services Company, an AER
subsidiary that procured fuel and natural gas and managed
the related risks for the Ameren Companies prior to
January 1, 2011. Effective January 1, 2011, the functions
previously performed by AFS were assumed by the Ameren
Missouri, Ameren Illinois and Merchant Generation
business segments.
Ameren – Ameren Corporation and its subsidiaries on a
consolidated basis. In references to financing activities,
acquisition activities, or liquidity arrangements, Ameren is
defined as Ameren Corporation, the parent.
Ameren Companies – The individual registrants within the
Ameren consolidated group.
Ameren Illinois or AIC – Ameren Illinois Company, an
Ameren Corporation subsidiary that operates a rate-
regulated electric and natural gas transmission and
distribution business in Illinois, doing business as Ameren
Illinois. This business consists of the combined rate-
regulated electric and natural gas transmission and
distribution businesses operated by CIPS, CILCO and IP
before the Ameren Illinois Merger. References to Ameren
Illinois prior to the Ameren Illinois Merger refer collectively
to the rate-regulated electric and natural gas transmission
and distribution businesses of CIPS, CILCO and IP.
Immediately after the Ameren Illinois Merger, Ameren
Illinois distributed the common stock of AERG to Ameren
Corporation. AERG’s operating results and cash flows were
presented as discontinued operations in Ameren Illinois’
financial statements.
Ameren Illinois Merger – On October 1, 2010, CILCO and
IP merged with and into CIPS, with the surviving
corporation renamed Ameren Illinois Company.
Ameren Illinois Regulated Segment – A financial reporting
segment consisting of Ameren Illinois’ rate-regulated
businesses.
Ameren Missouri or AMO – Union Electric Company, an
Ameren Corporation subsidiary that operates a rate-
regulated electric generation, transmission and distribution
business, and a rate-regulated natural gas transmission and
distribution business in Missouri, doing business as
Ameren Missouri. Ameren Missouri is also defined as a
financial reporting segment consisting of Union Electric
Company’s rate-regulated businesses.
Ameren Services – Ameren Services Company, an Ameren
Corporation subsidiary that provides support services to
Ameren and its subsidiaries.
AMIL – The MISO balancing authority area operated by
Ameren, which includes the load of Ameren Illinois and the
generating assets of Genco (excluding EEI and Genco’s
Elgin CT facility) and AERG.
AMMO – The MISO balancing authority area operated by
Ameren, which includes the load and generating assets of
Ameren Missouri.
ARO – Asset retirement obligations.
ATX – Ameren Transmission Company, an Ameren
Corporation subsidiary dedicated to electric transmission
infrastructure investment.
ATXI – Ameren Transmission Company of Illinois, an
Ameren Corporation subsidiary that is engaged in the
construction and operation of electric transmission assets
in Illinois.
Baseload – The minimum amount of electric power
delivered or required over a given period of time at a steady
rate.
Btu – British thermal unit, a standard unit for measuring the
quantity of heat energy required to raise the temperature of
one pound of water by one degree Fahrenheit.
CAIR – Clean Air Interstate Rule.
Capacity factor – A percentage measure that indicates how
much of an electric power generating unit’s capacity was
used during a specific period.
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CCR – Coal combustion residuals.
CILCO – Central Illinois Light Company, a former Ameren
Corporation subsidiary that operated a rate-regulated
electric transmission and distribution business, a merchant
electric generation business through AERG, and a rate-
regulated natural gas transmission and distribution
business, all in Illinois, before the Ameren Illinois Merger.
CILCO owned all of the common stock of AERG and
included AERG within its consolidated financial statements.
Immediately after the Ameren Illinois Merger in 2010,
Ameren Illinois distributed the common stock of AERG to
Ameren Corporation. AERG was treated as a discontinued
operation within Ameren Illinois’ financial statements.
CILCORP – CILCORP Inc., a former Ameren Corporation
subsidiary that operated as a holding company for CILCO
and its merchant generation subsidiary. On March 4, 2010,
CILCORP merged with and into Ameren.
CIPS – Central Illinois Public Service Company, an Ameren
Corporation subsidiary, renamed Ameren Illinois Company
at the effective date of the Ameren Illinois Merger, that
operates a rate-regulated electric and natural gas
transmission and distribution business, all in Illinois.
CO2 – Carbon dioxide.
COLA – Combined nuclear plant construction and operating
license application.
Cole County Circuit Court – Circuit Court of Cole County,
Missouri.
Cooling degree-days – The summation of positive
differences between the mean daily temperature and a
65-degree Fahrenheit base. This statistic is useful for
estimating electricity demand by residential and commercial
customers for summer cooling.
CSAPR – Cross-State Air Pollution Rule.
CT – Combustion turbine electric generation equipment
used primarily for peaking capacity.
DOE – Department of Energy, a United States government
agency.
DRPlus – Ameren Corporation’s dividend reinvestment and
direct stock purchase plan.
Dth (dekatherm) – One million Btus of natural gas.
EEI – Electric Energy, Inc., an 80%-owned Genco subsidiary
that operates merchant electric generation facilities and
FERC-regulated transmission facilities in Illinois. Effective
January 1, 2010, in an internal reorganization, AER
contributed its 80% ownership interest in EEI to its
subsidiary, Genco. The remaining 20% ownership interest
is owned by Kentucky Utilities Company, a nonaffiliated
entity.
EPA – Environmental Protection Agency, a U.S. government
agency.
Equivalent availability factor – A measure that indicates
the percentage of time an electric power generating unit
was available for service during a period.
ERISA – Employee Retirement Income Security Act of 1974,
as amended.
Exchange Act – Securities Exchange Act of 1934, as
amended.
FAC – A fuel and purchased power cost recovery
mechanism that allows Ameren Missouri to recover,
through customer rates, 95% of changes in fuel (coal, coal
transportation, natural gas for generation, and nuclear),
emission allowances and purchased power costs, net of
off-system revenues, including MISO costs and revenues,
greater or less than the amount set in base rates, without a
traditional rate proceeding.
FASB – Financial Accounting Standards Board, a
rulemaking organization that establishes financial
accounting and reporting standards in the United States.
FERC – The Federal Energy Regulatory Commission, a
United States government agency.
Fitch – Fitch Ratings, a credit rating agency.
FTRs – Financial transmission rights, financial instruments
that entitle the holder to pay or receive compensation for
certain congestion-related transmission charges between
two designated points.
Fuelco – Fuelco LLC, a limited liability company that
provides nuclear fuel management and services to its
members. The members are Ameren Missouri, Luminant,
and Pacific Gas and Electric Company.
GAAP – Generally accepted accounting principles in the
United States of America.
Genco – Ameren Energy Generating Company, an AER
subsidiary that operates a merchant electric generation
business in Illinois and holds an 80% ownership interest in
EEI.
Gigawatthour – One thousand megawatthours.
Heating degree-days – The summation of negative
differences between the mean daily temperature and a 65-
degree Fahrenheit base. This statistic is useful as an
indicator of demand for electricity and natural gas for winter
space heating by residential and commercial customers.
IBEW – International Brotherhood of Electrical Workers, a
labor union.
ICC – Illinois Commerce Commission, a state agency that
regulates Illinois utility businesses, including ATXI and
Ameren Illinois.
IEIMA – Illinois Energy Infrastructure Modernization Act, an
Illinois law that established a performance-based formula
process for determining electric delivery service rates.
Ameren Illinois elected to participate in this regulatory
framework in 2012, which will require it to make
incremental capital expenditures to modernize its electric
distribution system over a ten-year period beginning in
2012, to meet performance standards, and to create jobs in
Illinois, among other things.
Illinois Customer Choice Law – Illinois Electric Service
Customer Choice and Rate Relief Law of 1997, which was
designed to introduce competition into the retail supply of
electric energy in Illinois.
Illinois EPA – Illinois Environmental Protection Agency, a
state government agency.
IP – Illinois Power Company, a former Ameren Corporation
subsidiary that operated a rate-regulated electric and natural
gas transmission and distribution business, all in Illinois,
before the Ameren Illinois Merger.
IPA – Illinois Power Agency, a state government agency
that has broad authority to assist in the procurement of
electric power for residential and nonresidential customers.
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ISRS – Infrastructure system replacement surcharge,
which is a cost recovery mechanism that allows Ameren
Missouri to recover gas infrastructure replacement costs
from utility customers without a traditional rate
proceeding.
IUOE – International Union of Operating Engineers, a labor
union.
Kilowatthour – A measure of electricity consumption
equivalent to the use of 1,000 watts of power over one
hour.
LIUNA – Laborers’ International Union of North America, a
labor union.
Marketing Company – Ameren Energy Marketing
Company, an AER subsidiary that markets power for
Genco, AERG, EEI and Medina Valley.
MATS – Mercury and Air Toxics Standards, issued by the
EPA on December 21, 2011, which limit mercury, acid
gases and other toxic pollution from power plants.
Medina Valley – AmerenEnergy Medina Valley Cogen
LLC, an AER subsidiary, which owns a 40-megawatt
natural gas-fired electric energy center. This energy center
was sold in February 2012.
MEEIA – Missouri Energy Efficiency Investment Act, a
Missouri law that allows electric utilities to recover costs
related to MoPSC-approved energy efficiency programs.
Megawatthour – One thousand kilowatthours.
Merchant Generation – A financial reporting segment
consisting primarily of the operations or activities of AER,
including Genco, AERG, Medina Valley and Marketing
Company.
MGP – Manufactured gas plant.
MIEC – Missouri Industrial Energy Consumers.
MISO – Midwest Independent Transmission System
Operator, Inc., an RTO.
MISO Energy and Operating Reserves Market – A market
that uses market-based pricing, which takes into account
transmission congestion and line losses, to compensate
market participants for power and ancillary services.
Missouri Environmental Authority – Environmental
Improvement and Energy Resources Authority of the state
of Missouri, a governmental body authorized to finance
environmental projects by issuing tax-exempt bonds and
notes.
Mmbtu – One million Btus.
Money pool – Borrowing agreements among Ameren and
its subsidiaries to coordinate and provide for certain
short-term cash and working capital requirements.
Separate money pools maintained for rate-regulated and
non-rate-regulated businesses are referred to as the utility
money pool and the non-state-regulated subsidiary money
pool, respectively.
Moody’s – Moody’s Investors Service Inc., a credit rating
agency.
MoOPC – Missouri Office of Public Counsel.
MoPSC – Missouri Public Service Commission, a state
agency that regulates Missouri utility businesses including
Ameren Missouri.
MPS – Multi-Pollutant Standard, an agreement, as
amended, reached in 2006 among Genco, AERG, EEI and
the Illinois EPA, which was codified in Illinois
environmental regulations.
MTM – Mark-to-market.
MW – Megawatt.
Native load – End-use retail customers whom we are
obligated to serve by statute, franchise, contract, or other
regulatory requirement.
NERC – North American Electric Reliability Corporation.
NO2 – Nitrogen dioxide.
NOx – Nitrogen oxide.
Noranda – Noranda Aluminum, Inc.
NPNS – Normal purchases and normal sales.
NRC – Nuclear Regulatory Commission, a United States
government agency.
NSPS – New Source Performance Standards, a provision
under the Clean Air Act.
NSR – New Source Review provisions of the Clean Air
Act, which include Nonattainment New Source Review and
Prevention of Significant Deterioration regulations.
NWPA – Nuclear Waste Policy Act of 1982, as amended.
NYMEX – New York Mercantile Exchange.
NYSE – New York Stock Exchange, Inc.
OATT – Open Access Transmission Tariff.
OCI – Other comprehensive income (loss) as defined by
GAAP.
Off-system revenues – Revenues from other than native
load sales, including wholesale sales beginning with the
effective date of the MoPSC’s 2011 electric rate order.
OTC – Over-the-counter.
PGA – Purchased Gas Adjustment tariffs, which permit
prudently incurred natural gas costs to be recovered
directly from utility customers without a traditional rate
proceeding.
PJM – PJM Interconnection LLC.
PUHCA 2005 – The Public Utility Holding Company Act of
2005, enacted as part of the Energy Policy Act of 2005,
effective February 8, 2006.
Regulatory lag – The effect of adjustments to retail
electric and natural gas rates being based on historic cost
and revenue levels. Rate increase requests can take up to
11 months to be acted upon by the MoPSC and the ICC.
As a result, revenue increases authorized by regulators
will lag behind changing costs and revenues when based
on historical periods.
RFP – Request for proposal.
RTO – Regional Transmission Organization.
S&P – Standard & Poor’s Ratings Services, a credit rating
agency.
SEC – Securities and Exchange Commission, a
United States government agency.
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SERC – SERC Reliability Corporation, one of the regional
electric reliability councils organized for coordinating the
planning and operation of the nation’s bulk power supply.
SO2 – Sulfur dioxide.
UA – United Association of Plumbers and Pipefitters, a
labor union.
UGSOA – United Government Security Officers of
America, a labor union.
FORWARD-LOOKING STATEMENTS
Statements in this report not based on historical facts
are considered “forward-looking” and, accordingly,
involve risks and uncertainties that could cause actual
results to differ materially from those discussed. Although
such forward-looking statements have been made in good
faith and are based on reasonable assumptions, there is
no assurance that the expected results will be achieved.
These statements include (without limitation) statements
as to future expectations, beliefs, plans, strategies,
objectives, events, conditions, and financial performance.
In connection with the “safe harbor” provisions of the
Private Securities Litigation Reform Act of 1995, we are
providing this cautionary statement to identify important
factors that could cause actual results to differ materially
from those anticipated. The following factors, in addition
to those discussed under Risk Factors and elsewhere in
this report and in our other filings with the SEC, could
cause actual results to differ materially from management
expectations suggested in such forward-looking
statements:
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regulatory, judicial, or legislative actions, including
changes in regulatory policies and ratemaking
determinations, such as the outcome of Ameren
Missouri’s and Ameren Illinois’ electric rate cases
filed in 2012; the Ameren Illinois’ natural gas rate
order issued in 2012; the court appeals related to
Ameren Missouri’s 2010 and 2011 electric rate
orders; Ameren Illinois’ 2010 electric and natural gas
rate order; Ameren Missouri’s FAC prudence review;
and future regulatory, judicial, or legislative actions
that seek to change regulatory recovery mechanisms,
such as the recent passage of legislation providing for
formula ratemaking in Illinois;
the effect of Ameren Illinois participating in a new
performance-based formula ratemaking process
under the IEIMA, the related financial commitments
required by the IEIMA and the resulting uncertain
impact on the financial condition, results of
operations and liquidity of Ameren Illinois;
the effects of, or changes to, the Illinois power
procurement process;
changes in laws and other governmental actions,
including monetary, fiscal, and tax policies;
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changes in laws or regulations that adversely affect
the ability of electric distribution companies and other
purchasers of wholesale electricity to pay their
suppliers, including Ameren Missouri and Marketing
Company;
the effects of increased competition in the future due
to, among other things, deregulation of certain
aspects of our business at both the state and federal
levels, and the implementation of deregulation, such
as occurred when the electric rate freeze and power
supply contracts expired in Illinois at the end of 2006;
the effects on demand for our services resulting from
technological advances, including advances in energy
efficiency and distributed generation sources, which
generate electricity at the site of consumption;
increasing capital expenditure and operating expense
requirements and our ability to recover these costs
through our regulatory frameworks;
the cost and availability of fuel such as coal, natural
gas, and enriched uranium used to produce electricity;
the cost and availability of purchased power and natural
gas for distribution; and the level and volatility of future
market prices for such commodities, including the
ability to recover the costs for such commodities;
the effectiveness of our risk management strategies
and the use of financial and derivative instruments;
the level and volatility of future prices for power in the
Midwest;
the development of a capacity market within MISO;
business and economic conditions, including their
impact on interest rates, bad debt expense, and
demand for our products;
disruptions of the capital markets or other events that
make the Ameren Companies’ access to necessary
capital, including short-term credit and liquidity,
impossible, more difficult, or more costly;
our assessment of our liquidity;
the impact of the adoption of new accounting
guidance and the application of appropriate technical
accounting rules and guidance;
actions of credit rating agencies and the effects of
such actions;
the impact of weather conditions and other natural
phenomena on us and our customers;
the impact of system outages;
generation, transmission, and distribution asset
construction, installation, performance, and cost
recovery;
the effects of our increasing investment in electric
transmission projects and uncertainty as to whether
we will achieve our expected returns in a timely
fashion, if at all;
the extent to which Ameren Missouri prevails in its
claims against insurers in connection with its Taum
Sauk pumped-storage hydroelectric energy center
incident;
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the extent to which Ameren Missouri is permitted by its
regulators to recover in rates the investments it made
in connection with a proposed second unit at its
Callaway energy center;
impairments of long-lived assets, intangible assets, or
goodwill;
operation of Ameren Missouri’s Callaway energy center,
including planned and unplanned outages,
decommissioning, costs and potential increased costs
as a result of nuclear-related developments in Japan in
2011;
the effects of strategic initiatives, including mergers,
acquisitions and divestitures;
the impact of current environmental regulations on
utilities and power generating companies and new, more
stringent or changing requirements, including those
related to greenhouse gases, other emissions, cooling
water intake structures, CCR, and energy efficiency, that
are enacted over time and that could limit or terminate
the operation of certain of our generating units, increase
our costs, result in an impairment of our assets, reduce
our customers’ demand for electricity or natural gas, or
otherwise have a negative financial effect;
the impact of complying with renewable energy
portfolio requirements in Missouri;
labor disputes, workforce reductions, future wage and
employee benefits costs, including changes in discount
rates and returns on benefit plan assets;
the inability of our counterparties and affiliates to meet
their obligations with respect to contracts, credit
facilities, and financial instruments;
the cost and availability of transmission capacity for the
energy generated by the Ameren Companies’ energy
centers or required to satisfy energy sales made by the
Ameren Companies;
legal and administrative proceedings; and
acts of sabotage, war, terrorism, cybersecurity attacks
or intentionally disruptive acts.
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Given these uncertainties, undue reliance should not be placed on these forward-looking statements. Except to the extent
required by the federal securities laws, we undertake no obligation to update or revise publicly any forward-looking statements
to reflect new information or future events.
PART I
ITEM 1.
BUSINESS.
GENERAL
Ameren, headquartered in St. Louis, Missouri, is a
public utility holding company under PUHCA 2005
administered by FERC. Ameren was formed in 1997 by the
merger of Ameren Missouri and CIPSCO Inc. Ameren
acquired CILCORP in 2003 and IP in 2004. Ameren’s primary
assets are the common stock of its subsidiaries, including
Ameren Missouri, Ameren Illinois and AER. Ameren’s
subsidiaries are separate, independent legal entities with
separate businesses, assets, and liabilities. These subsidiaries
operate, as the case may be, rate-regulated electric
generation, transmission, and distribution businesses, rate-
regulated natural gas transmission and distribution
businesses, and merchant generation businesses in Missouri
and Illinois. Dividends on Ameren’s common stock and the
payment of other expenses by Ameren depend on
distributions made to it by its subsidiaries. Below is a
summary description of Ameren Missouri, Ameren Illinois
and AER. A more detailed description can be found in
Note 1 – Summary of Significant Accounting Policies under
Part II, Item 8, of this report.
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Ameren Missouri operates a rate-regulated electric
generation, transmission and distribution business, and
a rate-regulated natural gas transmission and
distribution business in Missouri.
Ameren Illinois operates a rate-regulated electric and
natural gas transmission and distribution business in
Illinois.
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AER consists of non-rate-regulated operations,
including Genco, AERG, Marketing Company and
Medina Valley (through February 2012). Genco
operates a merchant electric generation business in
Illinois and holds an 80% ownership interest in EEI.
The following table presents our total employees at
December 31, 2011:
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Ameren(a)
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9,323
4,333
2,793
618
(a) Total for Ameren includes Ameren registrant and nonregistrant
subsidiaries.
As of January 1, 2012, the IBEW, the IUOE, the LIUNA,
and the UA labor unions collectively represented about 58%
of Ameren’s total employees. They represented 63% of the
employees at Ameren Missouri, 65% at Ameren Illinois, and
67% at Genco. The collective bargaining agreements have
three- to five-year terms, and expire between 2012 and
2016. Several collective bargaining agreements between
Ameren subsidiaries and the IBEW, covering approximately
3,500 employees, expire during 2012. Additionally,
employees providing security at the Callaway energy center
elected to organize under the UGSOA in August 2011.
Negotiations for a collective bargaining agreement with
these employees began in December 2011 and are ongoing.
For additional information about the development of
our businesses, our business operations, and factors
affecting our operations and financial position, see
Management’s Discussion and Analysis of Financial
Condition and Results of Operations under Part II, Item 7,
of this report and Note 1 – Summary of Significant
Accounting Policies under Part II, Item 8, of this report.
BUSINESS SEGMENTS
Ameren has three reportable segments: Ameren
Missouri, Ameren Illinois, and Merchant Generation. See
Note 18 – Segment Information under Part II, Item 8, of this
report for additional information on reporting segments.
RATES AND REGULATION
Rates
The rates that Ameren Missouri and Ameren Illinois are
allowed to charge for their utility services significantly
influence the results of operations, financial position, and
liquidity of these companies and Ameren. The electric and
natural gas utility industry is highly regulated. The utility
rates charged to Ameren Missouri and Ameren Illinois
customers are determined, in large part, by governmental
entities, including the MoPSC, the ICC, and FERC. Decisions
by these entities are influenced by many factors, including
the cost of providing service, the prudency of expenditures,
the quality of service, regulatory staff knowledge and
experience, economic conditions, public policy, and social
and political views. Decisions made by these governmental
entities regarding rates are largely outside of Ameren
Missouri’s and Ameren Illinois’ control. These decisions, as
well as the regulatory lag involved in filing and getting new
rates approved, could have a material impact on the results
of operations, financial position, and liquidity of Ameren,
Ameren Missouri and Ameren Illinois. Rate orders are also
subject to appeal, which creates additional uncertainty as to
the rates Ameren Missouri and Ameren Illinois are
ultimately allowed to charge for their services. Beginning in
2012, the effect of regulatory lag on Ameren Illinois’ electric
distribution business is expected to be mitigated through
the use of the formula ratemaking regulatory framework
established under the IEIMA.
The ICC regulates rates and other matters for Ameren
Illinois and ATXI. The MoPSC regulates rates and other
matters for Ameren Missouri. The FERC regulates Ameren
Missouri, Ameren Illinois, Genco and ATXI as to their ability
to charge market-based rates for the sale and transmission
of energy in interstate commerce and various other matters
discussed below under General Regulatory Matters.
revenues were subject to regulation by the ICC in the year
ended December 31, 2011. Wholesale revenues for Ameren
Missouri, Ameren Illinois, Genco and AERG are subject to
FERC regulation, but not subject to direct MoPSC or ICC
regulation.
Ameren Missouri
Electric
About 99% of Ameren Missouri’s electric operating
revenues were subject to regulation by the MoPSC in the
year ended December 31, 2011 with the remainder subject
to FERC regulation.
In July 2011, the MoPSC issued an order approving an
increase for Ameren Missouri in annual revenues for
electric service of $173 million, including $52 million
related to an increase in normalized net fuel costs above the
net fuel costs included in base rates previously authorized
by the MoPSC in its May 2010 electric rate order. The
revenue increase was based on a 10.2% return on equity, a
capital structure composed of 52.2% common equity, and a
rate base of $6.6 billion. The rate changes became effective
on July 31, 2011. The MoPSC order approved the continued
use of Ameren Missouri’s vegetation management and
infrastructure cost tracker, pension and postretirement
benefit cost tracker, and FAC at the current 95% sharing
level. The MoPSC order shortened the FAC recovery and
refund period from 12 months to eight months.
Additionally, the MoPSC order provided for a tracking
mechanism for uncertain income tax positions.
In February 2012, Ameren Missouri filed a request with
the MoPSC to increase its annual revenues for electric
service by $376 million. Included in this requested increase
was a $103 million increase in normalized net fuel costs
above the net fuel costs included in base rates previously
authorized by the MoPSC in its July 2011 electric rate
order. Absent initiation of this general rate proceeding, 95%
of this amount would have been reflected in rate
adjustments implemented under Ameren Missouri’s FAC.
The request also included recovery of the costs associated
with energy efficiency programs under the MEEIA, including
energy efficiency investments, a storm cost tracking
mechanism, plant-in-service accounting treatment, and
recovery of other costs incurred to provide systemwide
reliability improvements for customers, among other items.
The electric rate increase request was based on a 10.75%
return on equity, a capital structure composed of 52%
common equity, an aggregate electric rate base of
$6.8 billion, and a test year ended September 30, 2011,
with certain pro forma adjustments expected through the
anticipated true-up date of July 31, 2012. A decision by the
MoPSC in this proceeding is expected in December 2012.
About 49% of Ameren’s electric and 16% of its natural
FERC regulates the rates charged and the terms and
gas operating revenues were subject to regulation by the
MoPSC in the year ended December 31, 2011. About 30%
of Ameren’s electric and 84% of its natural gas operating
conditions for electric transmission services. Each RTO
separately files a regional transmission tariff for approval by
FERC. All transmission service within that RTO is then
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subjected to that tariff. As a member of MISO, Ameren
Missouri’s transmission rate is calculated in accordance
with the MISO OATT. The transmission rate is updated in
June of each year; it is based on Ameren Missouri’s filings
with FERC. This rate is not directly charged to Missouri
retail customers, because in Missouri the MoPSC includes
transmission-related costs in setting bundled retail rates.
Natural Gas
All of Ameren Missouri’s natural gas operating
revenues were subject to regulation by the MoPSC in the
year ended December 31, 2011. In January 2011, the
MoPSC approved a stipulation and agreement that allowed
Ameren Missouri to increase annual natural gas revenues
by $9 million. The new rates became effective on
February 20, 2011. As part of the stipulation and
agreement, Ameren Missouri agreed not to file a separate
natural gas rate increase request before December 31,
2012; however, Ameren Missouri can file a combined
natural gas and electric rate case before that date. Further,
this agreement does not prevent Ameren Missouri from
filing to recover infrastructure replacement costs through
an ISRS during this moratorium. The return on equity to be
used by Ameren Missouri for purposes of the ISRS tariff
filing is 10%.
If certain criteria are met, Ameren Missouri’s natural
gas rates may be adjusted without a traditional rate
proceeding. PGA clauses permit prudently incurred natural
gas costs to be passed directly to the consumer. The ISRS
also permits prudently incurred natural gas infrastructure
replacement costs to be passed directly to the consumer.
For additional information on Missouri rate matters,
including Ameren Missouri’s pending electric rate case, and
Ameren Missouri’s 2009, 2010 and 2011 electric rate
orders and related court appeals and regulatory
proceedings, see Results of Operations and Outlook in
Management’s Discussion and Analysis of Financial
Condition and Results of Operations under Part II, Item 7,
Quantitative and Qualitative Disclosures About Market Risk
under Part II, Item 7A, and Note 2 – Rate and Regulatory
Matters, and Note 15 – Commitments and Contingencies
under Part II, Item 8, of this report.
Ameren Illinois
Electric
About 99% of Ameren Illinois’ electric operating
revenues were subject to regulation by the ICC in the year
ended December 31, 2011 with the remainder subject to
FERC regulation.
Under the Illinois Customer Choice Law, all electric
customers in Illinois may choose their own electric energy
provider. However, Ameren Illinois is required to serve as
the provider of last resort (POLR) for electric customers
within its territory who have not chosen an alternative retail
electric supplier. Ameren Illinois’ obligation to provide
POLR electric service varies by customer size. Ameren
Illinois is not required to offer fixed-priced electric service
to customers with electric demands of 400 kilowatts or
greater, as the market for service to this group of
customers has been declared competitive. Power and
related procurement costs incurred by Ameren Illinois are
passed directly to its customers through a cost recovery
mechanism.
In October 2011, the IEIMA was enacted into law and
became effective immediately. Certain amendments to the
IEIMA became effective on December 30, 2011. On
January 3, 2012, Ameren Illinois elected to participate in the
performance-based formula ratemaking process established
pursuant to the IEIMA by filing initial performance-based
formula rates with the ICC. The initial filing, based on 2010
recoverable costs and expected net plant additions for 2011
and 2012, will result in new electric delivery service rates in
October 2012. Pending ICC approval, the initial filing will
result in a decrease in Ameren Illinois revenues for electric
delivery service of $19 million, on an annualized basis.
Ameren Illinois anticipates making an update filing by
May 1, 2012, based on 2011 costs and expected net plant
additions for 2012, that would result in new electric delivery
service rates on January 1, 2013.
By choosing to opt-in, Ameren Illinois will participate
in a performance-based formula process for determining
rates that will provide for the recovery of actual costs of
electric delivery service that are prudently incurred, reflect
the utility’s actual regulated capital structure and include a
formula for calculating the return on equity component of
the cost of capital. The equity component of the formula
rate will be equal to the average for the applicable calendar
year of the monthly average yields of 30-year United States
treasury bonds plus 590 basis points for 2012 and 580
basis points thereafter. Ameren Illinois’ actual return on
equity relating to electric delivery service will be subject to a
collar adjustment on earnings in excess of 50 basis points
above or below its allowed return. Beginning in 2012, the
law provides for an annual reconciliation of revenues to
costs prudently and reasonably incurred. This annual
revenue reconciliation along with the collar adjustment, if
necessary, will be collected from or refunded to customers
in a subsequent year.
Ameren Illinois will also be subject to five performance
standards under the IEIMA whereby the failure to achieve the
standards will result in a reduction in its allowed return on
equity calculated under the formula. The performance
standards include improvements in service reliability to
reduce both the frequency and duration of outages,
improvements in customer satisfaction scores, reduction in
the number of estimated bills, and a reduction in uncollectible
accounts expense. The IEIMA provides for return on equity
penalties totaling up to 30 basis points in 2013 through 2015,
34 basis points in 2016 through 2018 and 38 basis points in
2019 through 2022 if the performance standards are not met.
The formula ratemaking process is effective until the end of
2017, but could be extended by the Illinois General Assembly
7
base of approximately $1 billion. The rate order was based
on a 2012 future test year. The rate changes became
effective on January 20, 2012. In February 2012, the ICC
denied rehearing requests by Ameren Illinois and an
intervenor related to the granted return on equity.
If certain criteria are met, Ameren Illinois’ natural gas
rates may be adjusted without a traditional rate proceeding.
PGA clauses permit prudently incurred natural gas costs to
be passed directly to the consumer. Also, Ameren Illinois
has approval from the ICC to use cost recovery
mechanisms for energy efficiency programs and bad debt
expense not recovered in base rates.
For additional information on Illinois rate matters,
including the IEIMA and the ICC’s January 2012 natural gas
rate order, see Results of Operations and Outlook in
Management’s Discussion and Analysis of Financial
Condition and Results of Operations under Part II, Item 7,
Quantitative and Qualitative Disclosures About Market Risk
under Part II, Item 7A, and Note 2 – Rate and Regulatory
Matters, and Note 15 – Commitments and Contingencies
under Part II, Item 8, of this report.
Merchant Generation
Merchant Generation revenues are determined by
market conditions and contractual arrangements. We expect
the Merchant Generation fleet of assets to have 5,503
megawatts of capacity available for the 2012 peak summer
electrical demand. This capacity reflects the closure of the
four units at Genco’s Meredosia and Hutsonville energy
centers and the sale of the Columbia CT during 2011, as
well as the sale of the Medina Valley energy center in early
2012. As discussed below, Genco and AERG sell all of their
power and capacity to Marketing Company through power
supply agreements. Marketing Company attempts to
optimize the value of those assets and to mitigate risks
through a variety of hedging techniques, including
wholesale sales of capacity and energy, retail sales in the
non-rate-regulated Illinois market, spot market sales
primarily in MISO and PJM, and financial transactions,
including options and other derivatives. Marketing
Company enters into long-term and short-term contracts.
Marketing Company’s counterparties include cooperatives,
municipalities, residential, commercial and industrial
customers, power marketers, MISO, PJM and investor-
owned utilities, including Ameren Illinois. For additional
information on Marketing Company’s hedging activities and
Marketing Company’s sales to Ameren Illinois, see Outlook
in Management’s Discussion and Analysis of Financial
Condition and Results of Operations under Part II, Item 7
and Note 7 – Derivative Financial Instruments and Note 14 –
Related Party Transactions under Part II, Item 8, of this
report.
for an additional five years. The formula ratemaking process
would also terminate if the average residential rate increases
by more than 2.5% annually from June 2011 through May
2014.
Between 2012 and 2021, Ameren Illinois will be
required to invest $625 million in capital expenditures
incremental to Ameren Illinois’ average electric delivery
capital expenditures for calendar years 2008 through 2010
to modernize its distribution system. Such investments are
expected to encourage economic development and create
an estimated 450 additional jobs within Illinois. Ameren
Illinois is subject to monetary penalties if 450 additional
jobs are not created during the peak program year. Also,
Ameren Illinois will be required to contribute $1 million
annually for certain nonrecoverable customer assistance
programs, up to a total of $10 million through 2021, for as
long as Ameren Illinois participates in the formula
ratemaking process. Ameren Illinois will also be required to
make a one-time $7.5 million nonrecoverable donation to
the Illinois Science and Energy Innovation Trust in 2012, as
well as an approximate $1 million annual donation to the
same trust for as long as it participates in the formula
ratemaking process.
Ameren Illinois has a tariff rider to recover the costs of
asbestos-related litigation claims, subject to the following
terms: 90% of cash expenditures in excess of the amount
included in base electric rates are to be recovered from a
trust fund that was established when Ameren acquired IP.
At December 31, 2011, the trust fund balance was
$23 million, including accumulated interest. If cash
expenditures are less than the amount in base rates,
Ameren Illinois will contribute 90% of the difference to the
fund. Once the trust fund is depleted, 90% of allowed cash
expenditures in excess of base rates will be recovered
through charges assessed to customers under the tariff
rider. Following the Ameren Illinois Merger, this rider is
applicable only for claims that occurred within IP’s
historical service territory. Similarly, the rider will permit
recovery only from customers within IP’s historical service
territory.
As a member of MISO, Ameren Illinois’ transmission
rate is calculated in accordance with the MISO OATT. The
transmission rate is updated in June of each year based on
Ameren Illinois’ filings with FERC. This rate is charged
directly to wholesale customers and alternative retail
electric suppliers. Retail customers who have not chosen an
alternative retail electric supplier pay the transmission rate
through a rider mechanism.
Natural Gas
All of Ameren Illinois’ natural gas operating revenues
were subject to regulation by the ICC in the year ended
December 31, 2011.
In January 2012, the ICC issued a rate order that
approved an increase in Ameren Illinois’ annual revenues
for natural gas delivery service of $32 million. The revenue
increase was based on a 9.06% return on equity, a capital
structure composed of 53.3% common equity, and a rate
8
General Regulatory Matters
Ameren Missouri and Ameren Illinois must receive
FERC approval to enter into various transactions, including
to issue short-term debt securities and to conduct certain
acquisitions, mergers, and consolidations involving electric
utility holding companies having a value in excess of
$10 million. In addition, these Ameren utilities must receive
authorization from the applicable state public utility
regulatory agency to issue stock and long-term debt
securities (with maturities of more than 12 months) and to
conduct mergers, affiliate transactions, and various other
activities. Genco and AERG are subject to FERC’s
jurisdiction when they issue any securities and when they
enter into certain other transactions, including those listed
above.
Ameren Missouri, Ameren Illinois, ATXI, Genco and
AERG are also subject to mandatory reliability standards,
including cybersecurity standards, adopted by FERC to
ensure the reliability of the bulk power electric system.
These standards are developed and enforced by NERC
pursuant to authority given to it by the FERC. If the Ameren
Companies were found not to be in compliance with any of
these mandatory reliability standards they may incur
substantial monetary penalties and other sanctions.
Under PUHCA 2005, FERC and any state public utility
regulatory agencies may access books and records of
Ameren and its subsidiaries that are determined to be
relevant to costs incurred by Ameren’s rate-regulated
subsidiaries with respect to jurisdictional rates. PUHCA
2005 also permits the MoPSC and the ICC to request that
FERC review cost allocations by Ameren Services to other
Ameren companies.
Operation of Ameren Missouri’s Callaway energy
center is subject to regulation by the NRC. Its facility
operating license expires on June 11, 2024. In December
2011, Ameren Missouri submitted a license extension
application with the NRC to extend the plant’s operating
license to 2044. There is no date by which the NRC must
act on this relicensing request. Ameren Missouri’s Osage
hydroelectric energy center and Ameren Missouri’s Taum
Sauk pumped-storage hydroelectric energy center, as
licensed projects under the Federal Power Act, are subject
to FERC regulations affecting, among other things, the
general operation and maintenance of the projects. The
license for Ameren Missouri’s Osage hydroelectric energy
center expires on March 30, 2047. In June 2008, Ameren
Missouri filed a relicensing application with FERC to operate
its Taum Sauk pumped-storage hydroelectric energy center
for another 40 years. The existing FERC license expired on
June 30, 2010. On July 2, 2010, Ameren Missouri received
a license extension that allows Taum Sauk to continue
operations until FERC issues a new license. FERC is
reviewing the relicensing application. A FERC order is
expected in 2012 or 2013. Ameren Missouri cannot predict
the ultimate outcome of the order. Ameren Missouri’s
Keokuk energy center and its dam, in the Mississippi River
between Hamilton, Illinois, and Keokuk, Iowa, are operated
under authority granted by an Act of Congress in 1905.
For additional information on regulatory matters, see
Note 2 – Rate and Regulatory Matters and Note 15 –
Commitments and Contingencies under Part II, Item 8, of
this report, which include a discussion about the December
2005 breach of the upper reservoir at Ameren Missouri’s
Taum Sauk pumped-storage hydroelectric energy center.
Environmental Matters
Certain of our operations are subject to federal, state,
and local environmental statutes or regulations relating to
the safety and health of personnel, the public, and the
environment. These environmental statutes and regulations
include requirements for identification, generation, storage,
handling, transportation, disposal, recordkeeping, labeling,
reporting, and emergency response in connection with
hazardous and toxic materials; safety and health standards;
and environmental protection requirements, including
standards and limitations relating to the discharge of air and
water pollutants and the management of waste and
byproduct materials. Failure to comply with those statutes
or regulations could have material adverse effects on us.
We could be subject to criminal or civil penalties by
regulatory agencies or we could be ordered by the courts to
pay private parties. Except as indicated in this report, we
believe that we are in material compliance with existing
statutes and regulations.
In addition to existing laws and regulations, including
the Illinois MPS, which govern our facilities, the EPA is
developing numerous new environmental regulations that
will have a significant impact on the electric utility industry.
These regulations could be particularly burdensome for
certain companies, including Ameren, Ameren Missouri and
Genco, that operate coal-fired energy centers. Significant
new rules proposed or promulgated since the beginning of
2010 include the regulation of greenhouse gas emissions;
revised national ambient air quality standards for SO2 and
NO2 emissions; the CSAPR, which requires further
reduction of SO2 and NOx emissions from power plants; a
regulation governing management of CCR and coal ash
impoundments; the MATS, which reduces emissions of
mercury, metals, and acid gases from power plants; revised
NSPS for particulate matter, SO2, and NOx emissions from
new sources; and new regulations under the Clean Water
Act that could require significant capital expenditures such
as new water intake structures or cooling towers at our
energy centers. The EPA also plans to propose an additional
rule, applicable to new and existing electric generating
units, governing NSPS and emission guidelines for
greenhouse gas emissions. These new regulations may be
litigated, so the timing of their implementation is uncertain,
as evidenced by the stay of the CSAPR by the United States
Court of Appeals for the District of Columbia on
December 30, 2011. Although many details of these future
regulations are unknown, the combined effects of the new
and proposed environmental regulations may result in
significant capital expenditures and/or increased operating
costs over the next five to ten years for Ameren, Ameren
Missouri and Genco. Actions required to ensure that our
9
facilities and operations are in compliance with
environmental laws and regulations could be prohibitively
expensive. If they are, these regulations could require us to
close or to significantly alter the operation of our energy
centers, which could have an adverse effect on our results
of operations, financial position, and liquidity, including the
impairment of plant assets. Failure to comply with
environmental laws and regulations might also result in the
imposition of fines, penalties, and injunctive measures.
For additional discussion of environmental matters,
including NOx, SO2, and mercury emission reduction
requirements, global climate change, remediation efforts,
and a discussion of the EPA’s allegations of violations of
the Clean Air Act and Missouri law in connection with
projects at certain coal-fired energy centers, see Liquidity
and Capital Resources in Management’s Discussion and
Analysis of Financial Condition and Results of Operations
under Part II, Item 7, and Note 15 – Commitments and
Contingencies under Part II, Item 8, of this report.
TRANSMISSION AND SUPPLY OF ELECTRIC POWER
Ameren owns an integrated transmission system that
comprises the transmission assets of Ameren Missouri,
Ameren Illinois and ATXI. Ameren also operates two
balancing authority areas, AMMO (which includes Ameren
Missouri), and AMIL (which includes Ameren Illinois, ATXI,
Genco excluding EEI and Genco’s Elgin CT facility, and
AERG). During 2011, the peak demand was 8,831
megawatts in AMMO and 9,605 megawatts in AMIL. The
Ameren transmission system directly connects with 15
other balancing authority areas for the exchange of electric
energy.
Ameren Missouri, Ameren Illinois and ATXI are
transmission-owning members of MISO. Transmission
service on the Ameren transmission systems is provided
pursuant to the terms of the MISO OATT on file with FERC.
EEI operates its own balancing authority area and its own
transmission facilities in southern Illinois. The EEI
transmission system is directly connected to MISO, the
Tennessee Valley Authority, and Louisville Gas and Electric
Company. EEI’s generating units are dispatched separately
from those of Ameren Missouri, Genco and AERG.
FERC, in its order issued in May 2011, approved
transmission rate incentives for the Illinois Rivers project and
the Big Muddy project, which will be developed by ATXI or
ATX. In December 2011, MISO approved the Illinois Rivers
project as well as the Spoon River and Mark Twain projects.
The total investment in these three MISO-approved projects
is expected to be more than $1.2 billion through 2019, with
potential investment of approximately $750 million from
2012 to 2016. All four projects are in Missouri and Illinois.
Construction will begin first on the Illinois Rivers project. The
Big Muddy project is currently being evaluated for inclusion
in MISO’s 2012 expansion plan.
system in all or portions of Missouri, Illinois, Arkansas,
Kentucky, Tennessee, North Carolina, South Carolina,
Georgia, Mississippi, Alabama, Louisiana, Virginia, Florida,
Oklahoma, Iowa, and Texas. As a result of the Energy Policy
Act of 2005, owners and operators of the bulk electric power
system are subject to mandatory reliability standards
promulgated by NERC and its regional entities, such as
SERC, which are enforced by FERC. The Ameren Companies
must follow these standards, which are in place to ensure the
reliability of the bulk electric power system.
See Note 2 – Rate and Regulatory Matters under Part
II, Item 8, of this report for additional information.
Ameren Missouri
Ameren Missouri’s electric supply is obtained primarily
from its own generation. Factors that could cause Ameren
Missouri to purchase power include, among other things,
absence of sufficient owned generation, energy center
outages, the fulfillment of renewable energy portfolio
requirements, the failure of suppliers to meet their power
supply obligations, extreme weather conditions, and the
availability of power at a cost lower than the cost of
generating it.
Ameren Missouri continues to evaluate its longer-term
needs for new baseload and peaking electric generation
capacity. Ameren Missouri’s integrated resource plan filed
with the MoPSC in February 2011 included the expectation
that new baseload generation capacity would be required
between 2020 and 2030. Because of the significant time
required to plan, acquire permits for, and build a baseload
power plant, Ameren Missouri continues to study future
plant alternatives, as well as energy efficiency programs
that could help defer new plant construction. To prepare for
the long-term need for baseload capacity, and to prepare for
potentially more stringent environmental regulation of coal-
fired energy centers, which could lead to the retirement of
current baseload assets, Ameren Missouri is taking steps to
preserve options to meet future demand. These steps
include seeking improvements in regulatory treatment of
energy efficiency investments, evaluating potential sites for
natural gas-fired generation, and pursuing an early site
permit for an additional unit at its existing nuclear plant site.
Ameren Missouri’s pursuit of an early site permit is
dependent upon enactment of a legislative framework
ensuring cost recovery.
See also Outlook in Management’s Discussion and
Analysis of Financial Condition and Results of Operations
under Part II, Item 7, and Note 2 – Rate and Regulatory
Matters and Note 15 – Commitments and Contingencies
under Part II, Item 8, of this report.
Ameren Illinois
Any electric supply purchased by Ameren Illinois for its
The Ameren Companies and EEI are members of SERC.
SERC is responsible for the bulk electric power supply
retail customers comes either through an annual
procurement process conducted by the IPA or through
10
markets operated by MISO. The power and related
procurement costs incurred by Ameren Illinois are passed
directly to its customers through a cost recovery
mechanism.
See Note 2 – Rate and Regulatory Matters, Note 14 –
Related Party Transactions and Note 15 – Commitments
and Contingencies under Part II, Item 8, of this report for
additional information on power procurement in Illinois.
The IPA administers a RFP process that procures
Ameren Illinois’ expected supply obligation. Since the start
of this process, the ICC has approved the outcomes of
multiple electric power procurement RFPs for energy,
capacity, and renewable energy credits covering different
time periods.
A portion of the electric power supply required for
Ameren Illinois to satisfy its distribution customers’
requirements is purchased in the RFP process administered
by the IPA from Marketing Company on behalf of Genco
and AERG. In addition, as part of the 2007 Illinois Electric
Settlement Agreement, Ameren Illinois entered into financial
contracts with Marketing Company (for the benefit of Genco
and AERG) to lock in energy prices for 400 to 1,000
megawatts annually of its round-the-clock power
requirements during the period June 1, 2008, through
December 31, 2012, at the market prices relevant at that
time. These financial contracts do not include capacity, are
not load-following products, and do not involve the physical
delivery of energy.
Merchant Generation
Genco and AERG have entered into power supply
agreements with Marketing Company whereby Genco and
AERG sell, and Marketing Company purchases, all of the
capacity and energy available from Genco’s and AERG’s
generation energy centers and the associated energy.
These power supply agreements continue through
December 31, 2022, and from year to year thereafter
unless either party elects to terminate the agreement by
providing the other party with no less than six months’
advance written notice. EEI and Marketing Company have
entered into a power supply agreement for EEI to sell all of
its capacity and energy to Marketing Company. This
agreement expires on May 31, 2016. All of Genco’s,
AERG’s and EEI’s energy centers compete for the sale of
energy and capacity in the competitive energy markets
through Marketing Company. See Note 14 – Related Party
Transactions under Part II, Item 8, of this report for
additional information.
POWER GENERATION
The following table presents the source of electric generation, excluding purchased power, for the years ended
December 31, 2011, 2010 and 2009:
Coal
Nuclear
Natural Gas
Renewables
Oil
Ameren:(a)
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
85%
85
83
77%
77
75
98%
98
99
Genco:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
99%
99
100
12%
12
13
19%
19
21
-%
-
-
-%
-
-
1%
1
1
1%
1
(b)
2%
2
1
1%
1
(b)
2%
2
3
3%
3
4
-%
-
-
-%
-
-
(b)%
(b)
(b)
(b)%
-
-
(b)%
(b)
(b)
(b)%
(b)
(b)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) Less than 1% of total fuel supply.
11
The following table presents the cost of fuels for electric generation for the years ended December 31, 2011, 2010 and
2009:
Cost of Fuels (Dollars per million Btus)
2011
2010
2009
Ameren:
Coal(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted average – all fuels(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Coal(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted average – all fuels(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation:
Coal(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted average – all fuels(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
Coal(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted average – all fuels(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
$
$
$
$
1.931
0.750
6.097
1.873
1.733
0.750
5.873
1.610
2.184
6.374
2.292
2.230
7.272
2.322
$
$
$
$
$
$
$
$
1.848
0.701
6.539
1.803
1.675
0.701
6.199
1.563
2.063
6.972
2.169
2.112
7.881
2.206
$
$
$
$
$
$
$
$
1.654
0.620
8.685
1.591
1.534
0.620
8.544
1.386
1.813
8.796
1.934
1.869
13.159
1.957
(a) The fuel cost for coal represents the cost of coal, costs for transportation, which includes railroad diesel fuel additives, and cost of emission
allowances.
(b) The fuel cost for natural gas represents the cost of natural gas and firm and variable costs for transportation, storage, balancing, and fuel
losses for delivery to the plant. In addition, the fixed costs for firm transportation and firm storage capacity are included in the calculation of
fuel cost for the generating facilities.
(c) Represents all costs for fuels used in our electric generating facilities, to the extent applicable, including coal, nuclear, natural gas, oil, propane,
tire chips, paint products, and handling. Oil, paint products, propane, and tire chips are not individually listed in this table because their use is
minimal.
Coal
Ameren, Ameren Missouri and Genco have agreements
in place to purchase a portion of their coal needs and to
transport it to electric generating energy centers through
2019. Ameren, Ameren Missouri and Genco expect to enter
into additional contracts to purchase coal from time to time.
Coal supply agreements typically have an initial term of up to
five years, with about 20% of the contracts expiring annually.
Ameren Missouri has an ongoing need for coal to serve its
native load customers and pursues a price hedging strategy
consistent with this requirement. Merchant Generation’s
forward coal requirements are dependent on the volume of
power sales that have been contracted. Merchant Generation
strives to achieve increased margin certainty by aligning its
fuel purchases with its power sales. Ameren burned
39 million tons (Ameren Missouri – 22 million, Genco –
13 million) of coal in 2011. See Part II, Item 7A – Quantitative
and Qualitative Disclosures About Market Risk of this report
for additional information about coal supply contracts.
About 98% of Ameren’s coal (Ameren Missouri – 97%,
Genco – 99%) is purchased from the Powder River Basin in
Wyoming. The remaining coal is typically purchased from
the Illinois Basin. Ameren, Ameren Missouri and Genco
have a goal to maintain coal inventory consistent with their
risk management policies. Inventory may be adjusted
because of changes in burn or uncertainties of supply due
to potential work stoppages, delays in coal deliveries,
equipment breakdowns, and other factors. In the past,
deliveries from the Powder River Basin have occasionally
been restricted because of rail maintenance, weather, and
derailments. As of December 31, 2011, coal inventories for
Ameren Missouri were at targeted levels and were at or
above targeted levels for Genco. Disruptions in coal
deliveries could cause Ameren, Ameren Missouri and Genco
to pursue a strategy that could include reducing sales of
power during low-margin periods, buying higher-cost fuels
to generate required electricity, and purchasing power from
other sources.
Nuclear
The steps in the process to provide nuclear fuel
generally involve the mining and milling of uranium ore to
produce uranium concentrates, the conversion of uranium
concentrates to uranium hexafluoride gas, the enrichment
of that gas, and the fabrication of the enriched uranium
hexafluoride gas into usable fuel assemblies. Ameren
Missouri has entered into uranium, uranium conversion,
enrichment, and fabrication contracts to procure the fuel
supply for its Callaway nuclear plant.
Fuel assemblies for the 2013 spring refueling at
Ameren Missouri’s Callaway energy center are scheduled
for manufacture and delivery to the plant during 2012.
Ameren Missouri also has agreements or inventories to
price-hedge approximately 92%, 82%, and 47% of
Callaway’s 2013, 2014 and 2016 refueling requirements,
respectively. Ameren Missouri has uranium (concentrate
and hexafluoride) inventories and supply contracts
sufficient to meet all of its uranium and conversion
requirements through at least 2014. Ameren Missouri has
enriched uranium inventories and enrichment supply
12
contracts sufficient to satisfy enrichment requirements
through 2013. Fuel fabrication services are under contract
through 2014. Ameren Missouri expects to enter into
additional contracts to purchase nuclear fuel. As a member
of Fuelco, Ameren Missouri can join with other member
companies to increase its purchasing power, enhance
diversification and pursue opportunities for volume
discounts. The Callaway nuclear plant normally requires
refueling at 18-month intervals. The last refueling was
completed in November 2011. There is no refueling
scheduled for 2012 and 2015. The nuclear fuel markets are
competitive, and prices can be volatile; however, we do not
anticipate any significant problems in meeting our future
supply requirements.
Natural Gas Supply for Generation
To maintain gas deliveries to gas-fired generating units
throughout the year, especially during the summer peak
demand, Ameren’s portfolio of natural gas supply resources
includes firm transportation capacity and firm no-notice
storage capacity leased from interstate pipelines. Ameren
Missouri and Genco primarily use the interstate pipeline
systems of Panhandle Eastern Pipe Line Company, Trunkline
Gas Company, Natural Gas Pipeline Company of America,
and Mississippi River Transmission Corporation to transport
natural gas to generating units. In addition to physical
transactions, Ameren uses financial instruments, including
some in the NYMEX futures market and some in the OTC
financial markets, to hedge the price paid for natural gas.
Ameren Missouri’s and Genco’s natural gas
procurement strategy is designed to ensure reliable and
immediate delivery of natural gas to their generating units.
This is accomplished by optimizing transportation and
storage options and minimizing cost and price risk through
various supply and price-hedging agreements that allow
access to multiple gas pools, supply basins, and storage
services. As of December 31, 2011, Ameren Missouri had
price-hedged about 12% and Genco had price-hedged 32%
of its expected natural gas supply requirements for
generation in 2012.
Renewable Energy
Illinois and Missouri have enacted laws requiring
electric utilities to include renewable energy resources in
their portfolios. Illinois requires renewable energy resources
to equal or exceed 2% of the total electricity that each
electric utility supplies to its eligible retail customers as of
June 1, 2008, increasing to 15% by June 1, 2015, and to
25% by June 1, 2025. Ameren Illinois has procured
renewable energy credits under the IPA-administered
procurement process to meet the renewable energy
portfolio requirement through May 2012. In December
2010, Ameren Illinois entered into a 20-year agreement with
renewable energy suppliers and will begin receiving
renewable energy credits under the agreement starting in
June 2012, to help supplement these requirements.
Approximately 50% of the 2012 renewable energy
requirement will be met through this agreement. In 2011,
Ameren Illinois procured approximately 6% of its total
electricity from renewable energy resources.
In Missouri, utilities are required to purchase or generate
from renewable energy sources electricity equaling at least
2% of native load sales, with that percentage increasing to at
least 15% by 2021, subject to a 1% limit on customer rate
impacts. At least 2% of each renewable energy portfolio
requirement must be derived from solar energy. Ameren
Missouri expects to satisfy the nonsolar requirement through
2017 with existing renewable generation in its current fleet
along with a 15-year 102 MW power purchase agreement
with a wind farm operator in Iowa that became effective in
2009 and the landfill gas project discussed below. Currently,
Ameren Missouri expects to meet the solar energy
requirement through the purchase of solar-generated
renewable energy credits; however, Ameren Missouri is
studying other options for compliance. In 2011, Ameren
Missouri purchased or generated approximately 3% of its
native load sales from renewable energy resources.
In September 2009, Ameren Missouri announced an
agreement with a landfill owner to install CTs at a landfill
site in Maryland Heights, Missouri, which is expected to
generate approximately 15 megawatts of electricity by
burning methane gas collected from the landfill. The CTs
(known as the Maryland Heights energy center) are
expected to begin generating power in 2012. Ameren
Missouri signed a 20-year supply agreement with the
landfill owner to purchase methane gas.
Energy Efficiency
Ameren’s rate-regulated utilities have implemented
energy efficiency programs to educate and help their
customers become more efficient users of energy. The
MEEIA, enacted in 2009, established a regulatory
framework that, among other things, allows electric utilities
to recover costs related to MoPSC-approved energy
efficiency programs. The law requires the MoPSC to ensure
that a utility’s financial incentives are aligned with helping
customers use energy more efficiently, to provide timely
cost recovery, and to provide earnings opportunities
associated with cost-effective energy efficiency programs.
Missouri does not have a law mandating energy efficiency
standards.
In January 2012, Ameren Missouri made its initial
filing with the MoPSC under the MEEIA. This filing
proposes a three-year plan that includes a portfolio of
energy efficiency programs along with a cost recovery
mechanism. If the proposal is approved, beginning in
January 2013, Ameren Missouri plans to invest
$145 million over three years for the proposed energy
efficiency programs. A decision by the MoPSC in this
proceeding is anticipated in the second quarter of 2012.
Ameren Missouri anticipates that the impacts of the
MoPSC’s decision in this MEEIA filing will be included in
rates set under its pending electric service rate case that
was filed on February 3, 2012, which has an anticipated
true-up date of July 31, 2012. Ameren Missouri’s pending
electric rate case includes an annual revenue increase of
13
$81 million relating to its planned portfolio of energy
efficiency programs included in its MEEIA filing. See
Note 2 – Rate and Regulatory Matters under Part II, Item 8,
of this report for additional information.
Policies, Note 7 – Derivative Financial Instruments,
Note 10 – Callaway Energy Center, Note 14 – Related Party
Transactions, and Note 15 – Commitments and
Contingencies under Part II, Item 8 of this report.
Illinois has enacted a law requiring Ameren Illinois to
offer energy efficiency programs. The law also allows
recovery mechanisms of the programs’ costs. The ICC has
issued orders approving Ameren Illinois’ electric and natural
gas energy efficiency plans as well as cost recovery
mechanisms by which program costs can be recovered
from customers. In addition, over a ten-year period,
Ameren Illinois will invest an estimated $625 million to
upgrade and modernize its transmission and distribution
infrastructure in accordance with the IEIMA. As part of
these upgrades, Ameren Illinois expects to invest
$360 million to install smart meters, which could enable
customers to improve efficiency.
NATURAL GAS SUPPLY FOR DISTRIBUTION
Ameren Missouri and Ameren Illinois are responsible for
the purchase and delivery of natural gas to their gas utility
customers. Ameren Missouri and Ameren Illinois develop and
manage a portfolio of gas supply resources. These include
firm gas supply under term agreements with producers,
interstate and intrastate firm transportation capacity, firm
storage capacity leased from interstate pipelines, and
on-system storage facilities to maintain gas deliveries to
customers throughout the year and especially during peak
demand. Ameren Missouri and Ameren Illinois primarily use
the Panhandle Eastern Pipe Line Company, the Trunkline Gas
Company, the Natural Gas Pipeline Company of America, the
Mississippi River Transmission Corporation, the Northern
Border Pipeline Company, and the Texas Eastern
Transmission Corporation interstate pipeline systems to
transport natural gas to their systems. In addition to physical
transactions, financial instruments, including those entered
into in the NYMEX futures market and in the OTC financial
markets, are used to hedge the price paid for natural gas. See
Part II, Item 7A – Quantitative and Qualitative Disclosures
About Market Risk of this report for additional information
about natural gas supply contracts. Natural gas purchase
costs are passed on to customers of Ameren Missouri and
Ameren Illinois under PGA clauses, subject to prudency
reviews by the MoPSC and the ICC. As of December 31,
2011, Ameren Missouri had price-hedged 90%, and Ameren
Illinois had price-hedged 87%, of its expected natural gas
supply requirements for distribution in 2012.
For additional information on our fuel and purchased
power supply, see Results of Operations, Liquidity and
Capital Resources and Effects of Inflation and Changing
Prices in Management’s Discussion and Analysis of
Financial Condition and Results of Operations under Part II,
Item 7, of this report. Also see Quantitative and Qualitative
Disclosures About Market Risk under Part II, Item 7A, of
this report, Note 1 – Summary of Significant Accounting
INDUSTRY ISSUES
We are facing issues common to the electric and
natural gas utility industry and the merchant electric
generation industry. These issues include:
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continually developing and complex environmental
laws, regulations and issues, including air and water
quality standards, mercury emissions standards, and
likely greenhouse gas limitations and ash management
requirements;
political and regulatory resistance to higher rates,
especially in a difficult economic environment;
the potential for changes in laws, regulation, and
policies at the state and federal level, including those
resulting from election cycles;
access to, and uncertainty in, the capital and credit
markets;
the potential for more intense competition in
generation, supply and distribution, including new
technologies;
pressure on customer growth and usage in light of
current economic conditions and energy efficiency
initiatives;
the potential for reregulation in some states, which could
cause electric distribution companies to build or acquire
generation facilities and to purchase less power from
electric generating companies such as Genco and AERG;
changes in the structure of the industry as a result of
changes in federal and state laws, including the
formation of merchant generators, independent
transmission entities and RTOs;
increases, decreases and volatility in power prices due
to the balance of supply and demand and marginal fuel
costs;
the availability of fuel and increases or decreases in fuel
prices;
the availability of qualified labor and material, and rising
costs;
regulatory lag;
decreased or negative free cash flows due to rising
infrastructure investments and regulatory frameworks;
public concern about the siting of new facilities;
aging infrastructure and the need to construct new
power generation, transmission and distribution
facilities;
legislation or proposals for programs to encourage or
mandate energy efficiency and renewable sources of
power;
public concerns about nuclear plant operation and
decommissioning and the disposal of nuclear waste; and
consolidation of electric and natural gas companies.
14
We are monitoring these issues. Except as otherwise
noted in this report, we are unable to predict what impact, if
any, these issues will have on our results of operations,
financial position, or liquidity. For additional information,
see Risk Factors under Part I, Item 1A, and Outlook in
Management’s Discussion and Analysis of Financial
Condition and Results of Operations under Part II, Item 7,
and Note 2 – Rate and Regulatory Matters and Note 15 –
Commitments and Contingencies under Part II, Item 8, of
this report.
OPERATING STATISTICS
The following tables present key electric and natural gas operating statistics for Ameren for the past three years:
Electric Operating Statistics – Year Ended December 31,
2011
2010
2009
Electric Sales – kilowatthours (in millions):
Ameren Missouri:
Residential
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Off-system and wholesale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Native load subtotal
Subtotal
Ameren Illinois:
Residential
Power supply and delivery service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery service only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial
Power supply and delivery service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery service only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial
Power supply and delivery service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery service only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Native load subtotal
13,867
14,743
8,691
127
37,428
10,715
48,143
11,771
77
3,662
8,561
1,502
11,360
529
37,462
14,640
15,002
8,656
129
38,427
9,796
48,223
12,340
1
4,419
8,051
1,389
11,147
545
37,892
13,413
14,510
7,037
137
35,097
13,965
49,062
11,089
-
5,235
6,797
514
10,712
546
34,893
Merchant Generation:
Subtotal
Nonaffiliate energy sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Affiliate native energy sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Eliminate affiliate sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Eliminate Ameren Illinois/Merchant Generation common customers . . . . . . . . . . . . . . . . . . . . . . .
Ameren total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
31,148
1,004
32,152
(1,004)
(5,454)
111,299
30,788
949
31,737
(949)
(5,016)
111,887
25,673
3,529
29,202
(3,529)
(5,566)
104,062
Electric Operating Revenues (in millions):
Ameren Missouri:
Residential
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Off-system and wholesale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Native load subtotal
Subtotal
Ameren Illinois:
Residential
Power supply and delivery service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery service only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial
Power supply and delivery service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery service only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial
Power supply and delivery service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Delivery service only . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Native load subtotal
Merchant Generation:
Nonaffiliate energy sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Affiliate native energy sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Eliminate affiliate revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
15
$
$
$
$
$
$
$
$
1,272
1,084
438
76
2,870
352
3,222
1,194
3
350
157
65
43
128
1,940
1,382
235
12
1,629
(261)
6,530
$
$
$
$
$
$
$
$
1,193
1,004
399
91
2,687
343
3,030
1,270
-
425
143
66
38
119
2,061
1,442
231
20
1,693
(263)
6,521
$
$
$
$
$
$
$
$
982
881
314
62
2,239
461
2,700
1,094
-
521
103
22
36
189
1,965
1,340
385
(15)
1,710
(435)
5,940
Electric Operating Statistics – Year Ended December 31,
2011
2010
2009
Electric Generation – megawatthours (in millions):
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation:
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
AERG . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Medina Valley . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
48.8
22.0
7.0
0.1
29.1
77.9
48.1
22.0
7.5
0.1
29.6
77.7
48.7
20.5
6.8
0.2
27.5
76.2
Price per ton of delivered coal (average) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
33.79
$
32.91
$
29.85
Source of energy supply:
Coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hydroelectric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchased – Wind . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchased – Other
66.5%
9.4
1.3
1.1
0.3
21.4
65.7%
8.9
1.6
1.0
0.3
22.5
67.0%
10.8
2.0
0.6
0.1
19.5
100.0%
100.0%
100.0%
Gas Operating Statistics – Year Ended December 31,
2011
2010
2009
Gas Sales (millions of Dth)
Ameren Missouri:
Residential
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Residential
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other:
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural Gas Operating Revenues (in millions)
Ameren Missouri:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Residential
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Residential
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commercial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other:
Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Subtotal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Eliminate affiliate revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak day throughput (thousands of Dth):
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total peak day throughput
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
$
$
$
7
3
1
11
56
21
5
82
-
-
93
96
41
9
10
156
588
195
30
33
846
-
-
(1)
1,001
149
1,157
1,306
$
$
$
$
$
$
$
7
4
1
12
60
23
7
90
1
1
103
100
43
10
13
166
649
223
44
37
953
4
4
(6)
1,117
167
1,227
1,394
$
$
$
$
$
$
$
7
4
1
12
60
26
7
93
3
3
108
106
47
10
7
170
646
259
38
72
1,015
15
15
(5)
1,195
163
1,353
1,516
16
AVAILABLE INFORMATION
The Ameren Companies make available free of charge
through Ameren’s website (www.ameren.com) their annual
reports on Form 10-K, quarterly reports on Form 10-Q,
current reports on Form 8-K, Ameren’s eXtensible Business
Reporting Language (XBRL) documents, and any
amendments to those reports filed with or furnished to
pursuant to Sections 13(a) or 15(d) of the Exchange Act as
soon as reasonably possible after such reports are
electronically filed with, or furnished to, the SEC. These
documents are also available through an Internet website
maintained by the SEC (www.sec.gov). Ameren also uses
its website as a channel of distribution of material
information relating to the Ameren Companies. Financial
and other material information regarding the Ameren
Companies is routinely posted and accessible at Ameren’s
website.
The Ameren Companies also make available free of
charge through Ameren’s website the charters of Ameren’s
board of directors’ audit and risk committee, human
resources committee, nominating and corporate
governance committee, finance committee, nuclear
oversight and environmental committee, and public policy
committee; the corporate governance guidelines; a policy
regarding communications to the board of directors; a
policy and procedures with respect to related-person
transactions; a code of ethics for principal executive and
senior financial officers; a code of business conduct
applicable to all directors, officers and employees; and a
director nomination policy that applies to the Ameren
Companies. The information on Ameren’s website, or any
other website referenced in this report, is not incorporated
by reference into this report.
ITEM 1A. RISK FACTORS.
Investors should review carefully the following risk
factors and the other information contained in this report.
The risks that the Ameren Companies face are not limited to
those in this section. There may be additional risks and
uncertainties (either currently unknown or not currently
believed to be material) that could adversely affect the
results of operations, financial position, and liquidity of the
Ameren Companies. See Forward-Looking Statements
above and Outlook in Management’s Discussion and
Analysis of Financial Condition and Results of Operations
under Part II, Item 7, of this report.
The Ameren Companies are subject to extensive
regulation of their businesses, which could adversely
affect their results of operations, financial position, and
liquidity.
The Ameren Companies are subject to, or affected by,
extensive federal, state, and local regulation. This extensive
regulatory framework, some but not all of which is more
specifically identified in the following risk factors, regulates,
among other matters, the electric and natural gas
industries; rate and cost structure of utilities; operation of
nuclear power facilities; construction and operation of
generation, transmission and distribution facilities;
acquisition, disposal, depreciation and amortization of
assets and facilities; transmission reliability; and present or
prospective wholesale and retail competition. The Ameren
Companies must address in their business planning and
management of operations the effects of existing and
proposed laws and regulations and potential changes in the
regulatory framework, including initiatives by federal and
state legislatures, RTOs, utility regulators, and taxing
authorities. Significant changes in the nature of the
regulation of the Ameren Companies’ businesses could
require changes to their business planning and
management of their businesses and could adversely affect
their results of operations, financial position, and liquidity.
Failure of the Ameren Companies to obtain adequate rates
or regulatory approvals in a timely manner, failure to obtain
necessary licenses or permits from regulatory authorities,
new or changed laws, regulations, standards,
interpretations, or other legal requirements, or increased
compliance costs could adversely impact the Ameren
Companies’ results of operations, financial position, and
liquidity.
The electric and natural gas rates that Ameren
Missouri and Ameren Illinois are allowed to charge are
determined through regulatory proceedings, which are
subject to appeal, and are subject to legislative actions,
which are largely outside of their control. Any events that
prevent Ameren Missouri or Ameren Illinois from
recovering their respective costs or from earning
appropriate returns on their investments could have a
material adverse effect on results of operations, financial
position, and liquidity.
The rates that Ameren Missouri and Ameren Illinois are
allowed to charge for their utility services significantly
influence the results of operations, financial position, and
liquidity of these companies and Ameren. The electric and
natural gas utility industries are highly regulated. The utility
rates charged to Ameren Missouri and Ameren Illinois
customers are determined, in large part, by governmental
entities, including the MoPSC, the ICC, and FERC. Decisions
by these entities are influenced by many factors, including
the cost of providing service, the prudency of expenditures,
the quality of service, regulatory staff knowledge and
experience, economic conditions, public policy, and social
and political views. Decisions made by these governmental
entities regarding rates are largely outside of Ameren
Missouri’s and Ameren Illinois’ control. Regulatory lag
involved in filing and getting new rates approved could have
a material adverse effect on our results of operations,
financial position, and liquidity. Rate orders are also subject
to appeal, which creates additional uncertainty as to the
rates Ameren Missouri and Ameren Illinois will ultimately be
allowed to charge for their services.
Ameren Missouri electric and natural gas utility rates
and Ameren Illinois natural gas utility rates are typically
established in regulatory proceedings that take up to 11
months to complete. Rates established in those
17
proceedings for Ameren Missouri are primarily based on
historical costs and revenues. Rates established in those
proceedings for Ameren Illinois may be based on historical
or estimated future costs and revenues. Thus, the rates a
utility is allowed to charge may not match its costs at any
given time. Rates include an allowed return on investments
by the regulators. Although rate regulation is premised on
providing a reasonable opportunity to earn a reasonable
rate of return on invested capital, there can be no assurance
that the applicable regulatory commission will judge all the
costs of Ameren Missouri and Ameren Illinois to have been
prudently incurred or that the regulatory process in which
rates are determined will always result in rates that will
produce full recovery of such costs or an adequate return
on those investments. In 2011, for example, the MoPSC
issued an electric rate order that disallowed $89 million of
costs incurred related to the rebuilding of the Taum Sauk
energy center. As a result, Ameren and Ameren Missouri
each recorded a 2011 pretax charge to earnings of
$89 million.
During periods of rising costs and investments or
declining retail usage, Ameren Missouri and Ameren Illinois
may not be able to earn the allowed return established by
their regulators. This could result in deferral or elimination
of planned capital investments. A period of increasing rates
for our customers could result in additional regulatory and
legislative actions, as well as competitive and political
pressures, which could have a material adverse effect on
our results of operations, financial position, and liquidity.
By choosing to participate in the performance-based
formula ratemaking process established pursuant to the
IEIMA, Ameren Illinois’ return on equity will be directly
correlated to yields on United States treasury bonds.
Additionally, Ameren Illinois will be subject to an annual
ICC prudence review and will be required to achieve
performance objectives, increase capital spending
levels, and meet job creation targets, which if not
successfully completed or achieved could have a material
adverse effect on its results of operations, financial
position, and liquidity.
On January 3, 2012, Ameren Illinois elected to
participate in the performance-based formula ratemaking
process established pursuant to the IEIMA by submitting its
initial filing with the ICC for its electric distribution business.
The ICC will annually review Ameren Illinois’ performance-
based rate filings under the IEIMA for reasonableness and
prudency. The ICC could conclude that Ameren Illinois’
incurred costs were not prudently incurred and thus
disallow recovery of such costs annually. Additionally, the
equity component of the formula rate will be equal to the
average for the applicable calendar year of the monthly
average yields of 30-year United States treasury bonds plus
590 basis points for 2012 and 580 basis points thereafter.
Therefore, Ameren Illinois’ annual return on equity will be
directly correlated to yields on United States treasury
bonds, which are outside of Ameren Illinois’ control.
Ameren Illinois will also be subject to performance
standards. Failure to achieve the standards will result in a
reduction in the company’s allowed return on equity
calculated under the formula. The IEIMA provides for return
on equity penalties totaling 30 basis points in 2013 through
2015, 34 basis points in 2016 through 2018, and 38 basis
points in 2019 through 2022 if the performance standards
are not met.
Between 2012 and 2021, Ameren Illinois will be required
to invest $625 million in capital expenditures incremental to
Ameren Illinois’ average electric delivery capital expenditures
for calendar years 2008 through 2010 to modernize its
distribution system. Ameren Illinois is subject to monetary
penalties if 450 additional jobs in Illinois are not created
during the peak program year.
The formula ratemaking process would terminate if the
average residential rate increases by more than 2.5%
annually from June 2011 through May 2014. The average
residential rate includes generation service, which is outside
of Ameren Illinois’ control, as Ameren Illinois is required to
purchase all of its power through procurement processes
administered by the IPA. If the performance-based formula
rate process is terminated, Ameren Illinois would be
required to establish future rates using a traditional rate
proceeding with the ICC, which may not result in rates that
produce a full or timely recovery of costs or an adequate
return on investments. Unless extended, the IEIMA formula
ratemaking process expires in 2017.
Energy conservation and energy efficiency efforts
could have a material adverse effect on the Ameren
Companies’ results of operations, financial position, and
liquidity.
Regulatory and legislative bodies have proposed or
introduced requirements and incentives to reduce energy
consumption. Conservation and energy efficiency programs
are designed to reduce energy demand. Unless there is a
regulatory solution, declining usage will result in an
underrecovery of fixed costs at our rate-regulated business.
A reduction in energy demand could have a material
adverse effect on the Ameren Companies’ results of
operations, financial position, and liquidity.
We are subject to various environmental laws and
regulations that require significant capital expenditures
or could result in closure of facilities, could increase our
operating costs, and could materially adversely influence
or limit our results of operations, financial position, and
liquidity, or expose us to fines and liabilities.
We are subject to various environmental laws and
regulations enforced by federal, state and local authorities.
From the beginning phases of siting and development to the
ongoing operation of existing or new electric generating,
transmission and distribution facilities and natural gas
storage, transmission and distribution facilities, our
activities involve compliance with diverse environmental
laws and regulations. These laws and regulations address
emissions, impacts to air, land and water, noise, protected
natural and cultural resources (such as wetlands,
18
endangered species and other protected wildlife, and
archeological and historical resources), and chemical and
waste handling. Complex and lengthy processes are
required to obtain approvals, permits, or licenses for new,
existing, or modified facilities. Additionally, the use and
handling of various chemicals or hazardous materials
(including wastes) requires release prevention plans and
emergency response procedures.
We are also subject to liability under environmental
laws for remediating environmental contamination of
property now or formerly owned by us or by our
predecessors, as well as property contaminated by
hazardous substances that we generated. Such sites include
MGP sites and third-party sites, such as landfills.
Additionally, private individuals may seek to enforce
environmental laws and regulations against us and could
allege injury from exposure to hazardous materials.
In addition to existing laws and regulations, including
the Illinois MPS that applies to our energy centers in
Illinois, the EPA is developing numerous new environmental
regulations that will have a significant impact on the electric
utility industry. These regulations could be particularly
burdensome for certain companies, including Ameren,
Ameren Missouri and Genco, that operate coal-fired plants.
These new regulations may be litigated, so the timing of
their ultimate implementation is uncertain, as evidenced by
the stay of the CSAPR by the United States Court of Appeals
for the District of Columbia on December 30, 2011.
Ameren also may be subject to risks in connection with
changing or conflicting interpretations of existing laws and
regulations. The EPA is engaged in an enforcement initiative
to determine whether coal-fired power plants failed to
comply with the requirements of the NSR and NSPS
provisions under the Clean Air Act when the plants
implemented modifications. Following the issuance of a
Notice of Violation, in January 2011, the Department of
Justice on behalf of the EPA filed a complaint against
Ameren Missouri in the United States District Court for the
Eastern District of Missouri. The EPA’s complaint alleges
that in performing projects at its Rush Island coal-fired
energy center, Ameren Missouri violated provisions of the
Clean Air Act and Missouri law. In January 2012, the United
States District Court granted, in part, Ameren Missouri’s
motion to dismiss various aspects of the EPA’s penalty
claims. The EPA’s claims for injunctive relief, including to
require the installation of pollution control equipment,
remain. At present, the complaint does not include Ameren
Missouri’s other coal-fired energy centers, but the EPA has
issued Notices of Violation under its NSR enforcement
initiative against the company’s Labadie, Meramec, and
Sioux coal-fired energy centers. Litigation of this matter
could take many years to resolve. An outcome in this matter
adverse to Ameren Missouri could require substantial
capital expenditures and the payment of substantial
penalties, neither of which can be determined at this time.
Such expenditures could affect unit retirement and
replacement decisions.
Ameren, Ameren Missouri and Genco have incurred
and expect to incur significant costs related to
environmental compliance and site remediation. New
environmental regulations, future environmental
regulations, voluntary compliance guidelines, enforcement
initiatives, or legislation could result in a significant increase
in capital expenditures and operating costs, decreased
revenues, increased financing requirements, penalties,
fines, or closure of facilities for Ameren, Ameren Missouri
and Genco. Actions required to ensure that our facilities and
operations are in compliance with environmental laws and
regulations could be prohibitively expensive. As a result,
environmental regulations could require us to close or to
significantly alter the operation of our energy centers, which
could have an adverse effect on our results of operations,
financial position, and liquidity, including the impairment of
plant assets. Although costs incurred by Ameren Missouri
to ensure its facilities are in compliance with environmental
laws and regulations would be eligible for recovery in rates
over time, subject to MoPSC approval in a rate proceeding,
there is no similar cost recovery mechanism for Genco or
for Ameren’s Merchant Generation business segment. We
are unable to predict the ultimate impact of these matters
on our results of operations, financial position, and liquidity.
Future limits on greenhouse gas emissions would
likely require Ameren, Ameren Missouri and Genco to
incur significant increases in capital expenditures and
operating costs, which, if excessive, could result in the
closures of coal-fired energy centers, impairment of
assets, or otherwise materially adversely affect our
results of operations, financial position, and liquidity.
State and federal authorities, including the United
States Congress, have considered initiatives to limit
greenhouse gas emissions and to address global climate
change. Potential impacts from any climate change
legislation or regulation could vary, depending upon
proposed CO2 emission limits, the timing of implementation
of those limits, the method of distributing any allowances,
the degree to which offsets are allowed and available, and
provisions for cost-containment measures, such as a
“safety valve” provision that provides a maximum price for
emission allowances. As a result of our diverse fuel
portfolio, our emissions of greenhouse gases vary among
our energy centers, but coal-fired power plants are
significant sources of CO2. The enactment of a climate
change law could result in a significant rise in household
costs and rates for electricity could rise significantly. The
burden could fall particularly hard on electricity consumers
and upon the economy in the Midwest because of the
region’s reliance on electricity generated by coal-fired
power plants.
Future federal and state legislation or regulations that
mandate limits on the emission of greenhouse gases would
likely result in significant increases in capital expenditures
and operating costs, which, in turn, could lead to increased
liquidity needs and higher financing costs. Moreover, to the
extent Ameren Missouri requests recovery of these costs
19
through rates, its regulators might deny some or all of, or
defer timely recovery of, these costs. Excessive costs to
comply with future legislation or regulations might force
Ameren, Ameren Missouri and Genco to close some coal-
fired energy centers earlier than planned, which could lead
to possible impairment of assets and reduced revenues. As
a result, mandatory limits could have a material adverse
impact on Ameren’s, Ameren Missouri’s, and Genco’s
results of operations, financial position, and liquidity.
The construction of, and capital improvements to,
Ameren’s, Ameren Missouri’s and Ameren Illinois’
electric and natural gas utility infrastructure as well as to
Ameren’s and Genco’s merchant generation facilities
involve substantial risks. These risks include escalating
costs, unsatisfactory performance by the projects when
completed, the inability to complete projects as
scheduled, cost disallowances by regulators and the
inability to earn a reasonable return on invested capital,
any of which could result in higher costs and the closure
of facilities.
Over the next five years, the Ameren Companies will
incur significant capital expenditures to comply with
existing and known environmental regulations and to make
investments in their electric and natural gas utility
infrastructure and their merchant generation facilities. The
Ameren Companies estimate that they will incur up to
$8.3 billion (Ameren Missouri – up to $3.6 billion; Ameren
Illinois – up to $3.3 billion; Genco – up to $0.4 billion;
other – up to $1.0 billion) of capital expenditures during the
period 2012 through 2016. These expenses include
construction expenditures, capitalized interest or allowance
for funds used during construction, compliance with
environmental standards, and compliance with the
requirements of the IEIMA.
Investments in Ameren’s regulated operations are
expected to be recoverable from ratepayers, but are subject
to prudency reviews and regulatory lag. The recoverability
of amounts expended in merchant generation operations
will depend upon market prices for capacity and energy.
The ability of the Ameren Companies to complete
facilities under construction successfully, and to complete
future projects within established estimates, is contingent
upon many variables and subject to substantial risks. These
variables include, but are not limited to, project
management expertise and escalating costs for materials,
labor, and environmental compliance. Delays in obtaining
permits, shortages in materials and qualified labor,
suppliers and contractors who do not perform as required
under their contracts, changes in the scope and timing of
projects, the inability to raise capital on favorable terms, or
other events beyond our control that could occur may
materially affect the schedule, cost, and performance of
these projects. With respect to capital spent for pollution
control equipment, there is a risk that electric generating
plants will not be permitted to continue to operate if
pollution control equipment is not installed by prescribed
deadlines or does not perform as expected. Should any
such construction efforts be unsuccessful, the Ameren
Companies could be subject to additional costs and to the
loss of their investment in the project or facility. The
Ameren Companies may also be required to purchase
electricity for their customers until the projects are
completed. All of these risks may have a material adverse
effect on the Ameren Companies’ results of operations,
financial position, and liquidity.
Our counterparties may not meet their obligations to
us.
We are exposed to the risk that counterparties to
various arrangements who owe us money, credit, energy,
coal, or other commodities or services will not be able to
perform their obligations or, with respect to our credit
facilities, will fail to honor their commitments. Should the
counterparties to commodity arrangements fail to perform,
we might be forced to replace or to sell the underlying
commitment at then-current market prices. Should the
lenders under our credit facilities fail to perform, the level of
borrowing capacity under those arrangements would
decrease, unless we were able to find replacement lenders
to assume the nonperforming lender’s commitment. In
such an event, we might incur losses, or our results of
operations, financial position, and liquidity could otherwise
be adversely affected.
Certain of the Ameren Companies have obligations to
other Ameren Companies or other Ameren subsidiaries as a
result of transactions involving energy, coal, other
commodities and services, borrowing from the money
pools, and as a result of hedging transactions. If one
Ameren entity failed to perform under any of these
arrangements, other Ameren entities might incur losses.
Their results of operations, financial position, and liquidity
could be adversely affected, resulting in the nondefaulting
Ameren entity being unable to meet its obligations,
including to unrelated third parties.
Increasing costs associated with our defined benefit
retirement and postretirement plans, health care plans,
and other employee benefits could materially adversely
affect our results of operations, financial position, and
liquidity.
We offer defined benefit retirement and postretirement
plans that cover substantially all of our employees.
Assumptions related to future costs, returns on
investments, interest rates, and other actuarial matters have
a significant impact on our earnings and funding
requirements. Ameren expects to fund its pension plans at a
level equal to the greater of the pension expense or the
legally required minimum contribution. Considering
Ameren’s assumptions at December 31, 2011, its
investment performance in 2011, and its pension funding
policy, Ameren expects to make annual contributions of
$90 million to $150 million in each of the next five years,
with aggregate estimated contributions of $580 million. We
expect Ameren Missouri’s, Ameren Illinois’, and Genco’s
portion of the future funding requirements to be 51%, 33%,
and 12%, respectively. These amounts are estimates. They
20
may change with actual investment performance, changes
in interest rates, changes in our assumptions, changes in
government regulations, and any voluntary contributions.
In addition to the costs of our retirement plans, the
costs of providing health care benefits to our employees
and retirees have increased in recent years. We believe that
our employee benefit costs, including costs of health care
plans for our employees and former employees, will
continue to rise. The increasing costs and funding
requirements associated with our defined benefit retirement
plans, health care plans, and other employee benefits could
increase our financing needs and otherwise materially
adversely affect our results of operations, financial position,
and liquidity.
Our electric generating, transmission and
distribution facilities are subject to operational risks that
could materially adversely affect our results of
operations, financial position, and liquidity.
The Ameren Companies’ financial performance
depends on the successful operation of electric generating,
transmission, and distribution facilities. Operation of electric
generating, transmission, and distribution facilities involves
many risks, including:
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facility shutdowns due to operator error or a failure of
equipment or processes;
longer-than-anticipated maintenance outages;
older generating equipment may require significant
expenditures to keep it operating at peak efficiency;
disruptions in the delivery of fuel or lack of adequate
inventories, including ultra-low-sulfur coal used for
Ameren Missouri’s compliance with environmental
regulations;
lack of water for cooling plant operations;
labor disputes;
inability to comply with regulatory or permit
requirements, including those relating to environmental
contamination;
disruptions in the delivery of electricity, including
impacts on us or our customers;
handling and storage of fossil-fuel combustion
byproducts, such as CCR;
unusual or adverse weather conditions, including
severe storms, droughts, floods and tornados;
a workplace accident that might result in injury or loss
of life, extensive property damage, or environmental
damage;
cybersecurity risk, including loss of operational control
of our energy centers and our electric and natural gas
transmission and distribution systems and/or loss of
data, such as utility customer data, account
information, and intellectual property through insider or
outsider actions;
catastrophic events such as fires, explosions, pandemic
health events, or other similar occurrences;
limitations on amounts of insurance available to cover
losses that might arise in connection with operating our
electric generating, transmission, and distribution
facilities; and
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other unanticipated operations and maintenance
expenses and liabilities.
We are subject to federal regulatory compliance and
proceedings, which increase our risk of regulatory
penalties and other sanctions.
The Energy Policy Act of 2005 increased FERC’s civil
penalty authority for violation of FERC statutes, rules, and
orders, including FERC Reliability Standards. FERC can
impose penalties of $1 million per violation per day. Under
the Energy Policy Act of 2005, the Ameren Companies, as
owners and operators of bulk power transmission systems
and/or electric generation facilities, are subject to
mandatory NERC reliability standards, including
cybersecurity standards. Compliance with these mandatory
reliability standards may subject the Ameren Companies to
higher operating costs and may result in increased capital
expenditures. If the Ameren Companies were found not to
be in compliance with these mandatory reliability standards
or other FERC statutes, rules and orders, the Ameren
Companies could incur substantial monetary penalties and
other sanctions, which could adversely affect our results of
operations, financial position, and liquidity.
Our natural gas distribution and storage activities
involve numerous risks that may result in accidents and
other operating risks and costs that could materially
adversely affect our results of operations, financial
position, and liquidity.
Inherent in our natural gas distribution and storage
activities are a variety of hazards and operating risks, such
as leaks, accidental explosions, mechanical problems and
cybersecurity risks, which could cause substantial financial
losses. In addition, these risks could result in serious injury
to employees and nonemployees, loss of human life,
significant damage to property, environmental pollution,
and impairment of our operations, which in turn could lead
to substantial losses for us. In accordance with customary
industry practice, we maintain insurance against some, but
not all, of these risks and losses. The location of
distribution lines and storage facilities near populated areas,
including residential areas, commercial business centers,
industrial sites, and other public gathering places, could
increase the level of damages resulting from these risks.
The occurrence of any of these events not fully covered by
insurance could materially adversely affect our results of
operations, financial position, and liquidity.
Even though agreements have been reached with the
state of Missouri and the FERC, the breach of the upper
reservoir of Ameren Missouri’s Taum Sauk pumped-
storage hydroelectric energy center could continue to
have a material adverse effect on Ameren’s and Ameren
Missouri’s results of operations, liquidity, and financial
condition.
In December 2005, there was a breach of the upper
reservoir at Ameren Missouri’s Taum Sauk pumped-storage
hydroelectric energy center. This resulted in significant
flooding in the local area, which damaged a state park.
21
terms such as damage provisions, credit support
requirements, and the number of available counterparties
interested in contracting for the desired forward period.
Depending on differences between market factors at the
time of contracting versus current conditions, Marketing
Company’s contract portfolio may have average contract
prices greater than or less than current market prices,
including at the expiration of the contracts, which could
significantly affect Ameren’s and Genco’s results of
operations, financial condition and liquidity.
Market prices for power have decreased over the past
three years. During 2012, the market price for power for
delivery in the current year has declined below 2011 levels
because of factors such as declining natural gas prices and
the stay of the CSAPR. Any unhedged forecasted generation
will be exposed to market prices at the time of sale. As a
result, any new physical or financial power sales may be at
price levels lower than previously experienced and lower
than the value of existing hedged sales.
Among the factors that could influence such prices (all
of which are beyond our control to a significant degree) are:
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current and future delivered market prices for natural
gas, coal, and related transportation costs;
current and forward prices for the sale of electricity;
current and future prices for emission allowances that
may be required to operate the fossil fuel-fired electric
energy centers in compliance with environmental laws
and permits;
the extent of additional supplies of electric energy from
current competitors or new market entrants;
the regulatory and market structures developed for
evolving Midwest energy markets, including a capacity
market in MISO;
changes enacted by the Illinois legislature, the ICC, the
IPA, or other government agencies with respect to
power procurement procedures;
the potential for reregulation of generation in some
states;
future pricing for, and availability of, services on
transmission systems, and the effect of RTOs and
export energy transmission constraints, which could
limit our ability to sell energy in our markets;
the growth rate or decline in electricity usage as a result
of population changes, regional economic conditions,
and the implementation of energy-efficiency and
conservation programs;
climate conditions in the Midwest market and major
natural disasters; and
environmental laws and regulations or delays in their
effective dates.
Ameren Missouri settled with FERC and the state of
Missouri all issues associated with the December 2005
Taum Sauk incident.
Ameren Missouri had liability insurance coverage for
the Taum Sauk incident, subject to certain limits and
deductibles. In June 2010, Ameren Missouri sued one of its
liability insurance providers claiming the insurance
company breached its duty to indemnify Ameren Missouri
for the losses experienced from the incident. Ameren’s and
Ameren Missouri’s results of operations, financial position
and liquidity could be adversely affected if Ameren
Missouri’s remaining liability insurance claims of
$68 million as of December 31, 2011, are not paid by
insurers.
Ameren Missouri requested the recovery of all costs of
enhancements, or costs that would have been incurred
absent the breach, related to the rebuilding of the Taum
Sauk energy center in excess of amounts recovered from
property insurance. In its July 2011 electric rate order, the
MoPSC disallowed Ameren Missouri’s request.
Consequently, in 2011, Ameren Missouri recorded a pretax
charge to earnings of $89 million. Ameren Missouri has
appealed this disallowance to the Missouri Court of
Appeals, Western District. Ameren Missouri cannot predict
the ultimate outcome of its appeal.
Until Ameren’s remaining liability insurance claims and
litigation are resolved, we are unable to determine the total
impact the breach could have on Ameren’s and Ameren
Missouri’s results of operations, financial position, and
liquidity beyond those amounts already recognized.
Genco’s and AERG’s electric energy centers must
compete for the sale of energy and capacity, which
exposes them to price risks.
All of Genco’s and AERG’s energy centers compete for
the sale of energy and capacity in the competitive energy
markets.
To the extent that electricity generated by these energy
centers is not under a fixed-price contract to be sold, the
revenues and results of operations of these Merchant
Generation subsidiaries generally depend on the prices that
can be obtained for energy and capacity in Illinois and
adjacent markets by Marketing Company.
Market prices for energy and capacity may fluctuate
substantially, sometimes over relatively short periods of
time, and at other times experience sustained increases or
decreases. Demand for electricity and fuel can fluctuate
dramatically, creating periods of substantial undersupply or
oversupply. During periods of oversupply, prices might be
depressed. Also, at times legislators or regulators with
jurisdiction over wholesale and retail energy commodity and
transportation rates may impose price limitations, bidding
rules, and other mechanisms to address volatility and other
issues in these markets.
For power products sold in advance, contract prices
are influenced both by market conditions and by contract
22
Ameren Missouri’s ownership and operation of a
nuclear energy center creates business, financial, and
waste disposal risks.
Ameren Missouri’s ownership of the Callaway energy
center subjects it to the risks of nuclear generation, which
include the following:
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potential harmful effects on the environment and
human health resulting from the operation of nuclear
facilities and the storage, handling and disposal of
radioactive materials;
the lack of a permanent waste storage site;
limitations on the amounts and types of insurance
commercially available to cover losses that might arise
in connection with the Callaway energy center or other
United States nuclear operations;
uncertainties with respect to contingencies and
assessment amounts if insurance coverage is
inadequate;
public and governmental concerns over the adequacy
of security at nuclear energy centers;
uncertainties with respect to the technological and
financial aspects of decommissioning nuclear energy
centers at the end of their licensed lives (Ameren
Missouri has submitted an application with the NRC to
extend the Callaway energy center’s operating license
from 2024 to 2044);
limited availability of fuel supply; and
costly and extended outages for scheduled or
unscheduled maintenance and refueling.
The NRC has broad authority under federal law to
impose licensing and safety requirements for nuclear
energy centers. In the event of noncompliance, the NRC has
the authority to impose fines or shut down a unit, or both,
depending upon its assessment of the severity of the
situation, until compliance is achieved. Revised safety
requirements promulgated from time to time by the NRC
could necessitate substantial capital expenditures at nuclear
energy centers such as Ameren Missouri’s. In addition, if a
serious nuclear incident were to occur, it could have a
material but indeterminable adverse effect on Ameren
Missouri’s results of operations, financial condition, and
liquidity. A major incident at a nuclear energy center
anywhere in the world could cause the NRC to limit or
prohibit the operation or relicensing of any domestic
nuclear unit. An incident at a nuclear energy center
anywhere in the world also could cause the NRC to impose
additional conditions or requirements on the industry,
which could increase costs and result in additional capital
expenditures. For example, the earthquake in 2011 that
affected nuclear plants in Japan is expected to result in
regulatory changes in the United States that may impose
additional costs on all United States nuclear plants.
Our energy risk management strategies may not be
effective in managing fuel and electricity procurement
and pricing risks, which could result in unanticipated
liabilities or increased volatility in our earnings and cash
flows.
We are exposed to changes in market prices for natural
gas, fuel, power, emission allowances, renewable energy
credits, and transmission congestion. Prices for natural
gas, fuel, power, emission allowances and renewable
energy credits may fluctuate substantially over relatively
short periods of time, and at other times exhibit sustained
increases or decreases, and expose us to commodity price
risk. We use short-term and long-term purchase and sales
contracts in addition to derivatives such as forward
contracts, futures contracts, options, and swaps to manage
these risks. We attempt to manage our risk associated with
these activities through enforcement of established risk
limits and risk management procedures. We cannot ensure
that these strategies will be successful in managing our
pricing risk or that they will not result in net liabilities
because of future volatility in these markets.
Although we routinely enter into contracts to hedge
our exposure to the risks of demand and changes in
commodity prices, we do not hedge the entire exposure of
our operations from commodity price volatility.
Furthermore, our ability to hedge our exposure to
commodity price volatility depends on liquid commodity
markets. To the extent that commodity markets are illiquid,
we may not be able to execute our risk management
strategies, which could result in greater unhedged positions
than we would prefer at a given time. To the extent that
unhedged positions exist, fluctuating commodity prices can
adversely affect our results of operations, financial position,
and liquidity.
Our facilities are considered critical energy
infrastructure and may therefore be targets of acts of
terrorism.
Like other electric and natural gas utilities and other
merchant electric generators, our energy centers, fuel
storage facilities, and transmission and distribution facilities
may be targets of terrorist activities, including cybersecurity
attacks, that could result in disruption of our ability to
produce or distribute some portion of our energy products.
Any such disruption could result in a significant decrease in
revenues or significant additional costs for repair, which
could have a material adverse effect on our results of
operations, financial position, and liquidity.
Our businesses are dependent on our ability to
access the capital markets successfully. We may not
have access to sufficient capital in the amounts and at
the times needed.
We use short-term and long-term debt as a significant
source of liquidity and funding for capital requirements not
satisfied by our operating cash flow, including requirements
related to future environmental compliance and capital
expenditures required by the IEIMA. As a result of rising
costs and increased capital and operations and maintenance
23
expenditures, coupled with regulatory lag, we expect to
continue to rely on short-term and long-term debt
financing. The inability to raise debt or equity capital on
favorable terms, or at all, could negatively affect our ability
to maintain and to expand our businesses. After assessing
our current operating performance, liquidity, and credit
ratings, we believe that Ameren and its rate-regulated
businesses will continue to have access to the capital
markets. However, events beyond our control, such as a
recession or extreme volatility in global debt or equity
capital and credit markets, may create uncertainty that
could increase our cost of capital or impair or eliminate our
ability to access the debt, equity or credit markets, including
our ability to draw on bank credit facilities. Based on
projections as of December 31, 2011, of Genco’s operating
results and cash flows, we expect that, by the end of the
first quarter of 2013, Genco’s interest coverage ratio will be
less than the minimum ratio required under its indenture for
the company to borrow additional funds from external,
third-party sources. An inability to raise debt could
adversely impact Genco’s liquidity. Any adverse change in
the Ameren Companies’ credit ratings may reduce access to
capital and trigger additional collateral postings and
prepayments. Such changes may also increase the cost of
borrowing and fuel, power and natural gas supply, among
other things, which could have a material adverse effect on
our results of operations, financial position, and liquidity.
Certain of the Ameren Companies rely, in part, on Ameren
for access to capital. Circumstances that limit Ameren’s
access to capital, including those relating to its other
subsidiaries, could impair its ability to provide those
Ameren Companies with needed capital. In addition,
borrowings directly from Ameren and from the utility and
non-state-regulated subsidiary money pools are subject to
Ameren’s control, and any borrowings are dependent on
consideration by Ameren of the facts and circumstances
existing at the time of any borrowing request.
Ameren’s holding company structure could limit its
ability to pay common stock dividends and to service its
debt obligations.
Ameren is a holding company; therefore, its primary
assets are the common stock of its subsidiaries. As a result,
Ameren’s ability to pay dividends on its common stock
depends on the earnings of its subsidiaries and the ability of
its subsidiaries to pay dividends or otherwise transfer funds
to Ameren. Similarly, Ameren’s ability to service its debt
obligations is also dependent upon the earnings of
operating subsidiaries and the distribution of those earnings
and other payments, including payments of principal and
interest under intercompany indebtedness. The payment of
dividends to Ameren by its subsidiaries in turn depends on
their results of operations and cash flows and other items
affecting retained earnings. Ameren’s subsidiaries are
separate and distinct legal entities and have no obligation,
contingent or otherwise, to pay any dividends or make any
other distributions (except for payments required pursuant
to the terms of intercompany borrowing arrangements) to
Ameren. Certain of the Ameren Companies’ financing
agreements and articles of incorporation, in addition to
certain statutory and regulatory requirements, may impose
restrictions on the ability of such Ameren Companies to
transfer funds to Ameren in the form of cash dividends,
loans or advances.
Failure to retain and attract key officers and other
skilled professional and technical employees could have
an adverse effect on our operations.
Our businesses depend upon our ability to employ and
retain key officers and other skilled professional and
technical employees. A significant portion of our workforce
is nearing retirement, including many employees with
specialized skills such as maintaining and servicing our
electric and natural gas infrastructure and operating our
energy centers. Any inability to retain and recruit qualified
employees could adversely affect our results of operations.
ITEM 1B. UNRESOLVED STAFF COMMENTS.
None.
ITEM 2.
PROPERTIES.
For information on our principal properties, see the generating facilities table below. See also Liquidity and Capital
Resources and Regulatory Matters in Management’s Discussion and Analysis of Financial Condition and Results of Operations
under Part II, Item 7, of this report for any discussion of planned additions, replacements or transfers. See also Note 5 – Long-
term Debt and Equity Financings, and Note 15 – Commitments and Contingencies under Part II, Item 8, of this report.
24
The following table shows what the capability of our energy centers is anticipated to be at the time of our expected 2012
peak summer electrical demand:
Primary Fuel Source
Energy Center
Location
Net Kilowatt Capability(a)
Ameren Missouri:
Coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total coal . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Hydroelectric . . . . . . . . . . . . . . . . . . . . . . . .
Total hydroelectric . . . . . . . . . . . . . . . . . . . .
Pumped-storage . . . . . . . . . . . . . . . . . . . . .
Oil (CTs) . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total oil . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas (CTs)
. . . . . . . . . . . . . . . . . . . .
Labadie
Rush Island
Sioux
Meramec
Callaway
Osage
Keokuk
Taum Sauk
Meramec
Fairgrounds
Mexico
Moberly
Moreau
Howard Bend
Audrain(b)
Venice(c)
Goose Creek
Pinckneyville
Raccoon Creek
Kinmundy(c)
Peno Creek(b)(c)
Meramec(c)
Kirksville
Franklin County, Mo.
Jefferson County, Mo.
St. Charles County, Mo.
St. Louis County, Mo.
Callaway County, Mo.
Lakeside, Mo.
Keokuk, Ia.
Reynolds County, Mo.
St. Louis County, Mo.
Jefferson City, Mo.
Mexico, Mo.
Moberly, Mo.
Jefferson City, Mo.
St. Louis County, Mo.
Audrain County, Mo.
Venice, Ill.
Piatt County, Ill.
Pinckneyville, Ill.
Clay County, Ill.
Kinmundy, Ill.
Bowling Green, Mo.
St. Louis County, Mo.
Kirksville, Mo.
Total natural gas . . . . . . . . . . . . . . . . . . . . .
Methane gas (CTs)
. . . . . . . . . . . . . . . . . . .
Maryland Heights
Maryland Heights, Mo.
Total Ameren Missouri
. . . . . . . . . . . . . .
Merchant Generation:
Genco:
Coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total coal . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas (CTs)
. . . . . . . . . . . . . . . . . . . .
Total natural gas . . . . . . . . . . . . . . . . . . . . .
Total Genco . . . . . . . . . . . . . . . . . . . . . . .
AERG:
Coal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total AERG . . . . . . . . . . . . . . . . . . . . . . .
Total Merchant Generation . . . . . . . . . . .
Total Ameren . . . . . . . . . . . . . . . . . . . . . .
Newton
Joppa (EEI)(d)
Coffeen
Grand Tower
Elgin
Gibson City(c)
Joppa 7B
Joppa (EEI)(d)
Newton, Ill.
Joppa, Ill.
Coffeen, Ill.
Grand Tower, Ill.
Elgin, Ill.
Gibson City, Ill.
Joppa, Ill.
Joppa, Ill.
E.D. Edwards
Duck Creek
Bartonville, Ill.
Canton, Ill.
2,412,000
1,212,000
966,000
836,000
5,426,000
1,190,000
240,000
141,000
381,000
440,000
59,000
55,000
54,000
54,000
54,000
39,000
315,000
600,000
491,000
432,000
316,000
300,000
208,000
188,000
49,000
13,000
2,597,000
6,000
10,355,000
1,198,000
1,002,000
895,000
3,095,000
478,000
460,000
228,000
108,000
74,000
1,348,000
4,443,000
650,000
410,000
1,060,000
5,503,000
15,858,000
(a) Net Kilowatt Capability is the generating capacity available for dispatch from the energy center into the electric transmission grid.
(b) There are economic development lease arrangements applicable to these CTs.
(c) These CTs have the capability to operate on either oil or natural gas (dual fuel).
(d) Genco owns an 80% interest in EEI. This table reflects the full capability of EEI’s facilities.
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The following table presents electric and natural gas
utility-related properties for Ameren Missouri and Ameren
Illinois as of December 31, 2011:
Circuit miles of electric transmission lines(a) . . .
Circuit miles of electric distribution lines . . . . . .
Circuit miles of electric distribution lines
Ameren
Missouri
Ameren
Illinois
2,956
33,256
4,506
45,884
underground . . . . . . . . . . . . . . . . . . . . . . . . .
23%
15%
Miles of natural gas transmission and
distribution mains . . . . . . . . . . . . . . . . . . . . .
Propane-air plants . . . . . . . . . . . . . . . . . . . . . . .
Underground gas storage fields . . . . . . . . . . . . .
Billion cubic feet of total working capacity of
3,275
1
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18,126
-
12
underground gas storage fields . . . . . . . . . . .
-
24
(a) ATXI and EEI own 29 miles and 42 miles of transmission lines,
respectively, not reflected in this table.
Our other properties include office buildings,
warehouses, garages, and repair shops.
With only a few exceptions, we have fee title to all
principal plants and other units of property material to the
operation of our businesses, and to the real property on
which such facilities are located (subject to mortgage liens
securing our outstanding first mortgage bonds and to
certain permitted liens and judgment liens). The exceptions
are as follows:
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A portion of Ameren Missouri’s Osage energy center
reservoir, certain facilities at Ameren Missouri’s Sioux
energy center, most of Ameren Missouri’s Peno Creek
and Audrain CT energy centers, certain substations,
and most transmission and distribution lines and
natural gas mains are situated on lands occupied under
leases, easements, franchises, licenses, or permits. The
United States or the state of Missouri may own or may
have paramount rights to certain lands lying in the bed
of the Osage River or located between the inner and
outer harbor lines of the Mississippi River on which
certain of Ameren Missouri’s energy centers and other
properties are located.
The United States, the state of Illinois, the state of Iowa,
or the city of Keokuk, Iowa, may own or may have
paramount rights with respect to certain lands lying in
the bed of the Mississippi River on which a portion of
Ameren Missouri’s Keokuk energy center is located.
Substantially all of the properties and plant of Ameren
Missouri and Ameren Illinois are subject to the first liens of
the indentures securing their mortgage bonds.
Ameren Missouri has conveyed most of its Peno Creek
CT energy center to the city of Bowling Green, Missouri, and
leased the energy center back from the city through 2022.
Under the terms of this capital lease, Ameren Missouri is
responsible for all operation and maintenance for the energy
center. Ownership of the energy center will transfer to
Ameren Missouri at the expiration of the lease, at which time
the property and plant will become subject to the lien of any
outstanding Ameren Missouri first mortgage bond indenture.
Ameren Missouri operates a CT energy center located
in Audrain County, Missouri. Ameren Missouri has rights
and obligations as lessee of the CT energy center under a
long-term lease with Audrain County. The lease term will
expire on December 1, 2023. Under the terms of this capital
lease, Ameren Missouri is responsible for all operation and
maintenance for the energy center. Ownership of the energy
center will transfer to Ameren Missouri at the expiration of
the lease, at which time the property and plant will become
subject to the lien of any outstanding Ameren Missouri first
mortgage bond indenture.
ITEM 3.
LEGAL PROCEEDINGS.
We are involved in legal and administrative proceedings
before various courts and agencies with respect to matters
that arise in the ordinary course of business, some of which
involve substantial amounts of money. We believe that the
final disposition of these proceedings, except as otherwise
disclosed in this report, will not have a material adverse effect
on our results of operations, financial position, or liquidity.
Risk of loss is mitigated, in some cases, by insurance or
contractual or statutory indemnification. We believe that we
have established appropriate reserves for potential losses.
Material legal and administrative proceedings, which are
discussed in Note 2 – Rate and Regulatory Matters, and Note
15 – Commitment and Contingencies under Part II, Item 8, of
this report and incorporated herein by reference, include the
following:
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appeals of the MoPSC’s 2010 and 2011 electric rate
orders;
appeal of the MoPSC’s April 2011 FAC prudence review
order and completion of the current FAC prudence
review;
electric rate proceedings for Ameren Missouri pending
before the MoPSC and for Ameren Illinois pending
before the ICC;
FERC litigation to determine wholesale distribution
revenues for seven of Ameren Illinois’ wholesale
customers;
Ameren Missouri’s appeal to FERC to contest additional
charges under a power purchase agreement with
Entergy Arkansas, Inc.;
the EPA’s Clean Air Act-related litigation filed against
Ameren Missouri and NSR investigations at Genco and
AERG;
remediation matters associated with MGP and waste
disposal sites of the Ameren Companies;
litigation associated with the breach of the upper
reservoir at Ameren Missouri’s Taum Sauk pumped-
storage hydroelectric energy center;
litigation alleging that CO2 emissions from several
industrial companies, including Ameren Missouri and
Genco, created the atmospheric conditions that
intensified Hurricane Katrina;
asbestos-related litigation associated with Ameren,
Ameren Missouri, Ameren Illinois and Genco; and
Genco’s challenge before the Informal Conference
Board of the Illinois Department of Revenue regarding
the State’s position that EEI did not qualify for
manufacturing tax exemptions for 2010 transactions.
‰
‰
‰
‰
‰
‰
‰
‰
‰
‰
26
ITEM 4. MINE SAFETY DISCLOSURES.
Not applicable.
EXECUTIVE OFFICERS OF THE REGISTRANTS (ITEM 401(b) OF REGULATION S-K):
The executive officers of the Ameren Companies, including major subsidiaries, are listed below, along with their ages as
of December 31, 2011, all positions and offices held with the Ameren Companies as of December 31, 2011, (except as
otherwise noted below), tenure as officer, and business background for at least the last five years. Some executive officers
hold multiple positions within the Ameren Companies; their titles are given in the description of their business experience.
AMEREN CORPORATION:
Age Positions and Offices Held
64
Name
Thomas R. Voss
Voss joined Ameren Missouri in 1969. He was elected senior vice president of Ameren Missouri, CIPS, and Ameren Services in
1999, of Genco in 2001, of CILCO in 2003, and of IP in 2004. In 2003, Voss was elected president of Genco; he relinquished
his presidency of this company in 2004. In 2006, he was elected executive vice president of Ameren Missouri, CIPS, CILCO
and IP. In 2007, Voss was elected chairman, president, and chief executive officer of Ameren Missouri. He relinquished his
positions at CIPS, CILCO and IP in 2007. In 2009, Voss was elected president and chief executive officer of Ameren; at that
time, he relinquished his other positions. In 2010, the Ameren board of directors elected Voss to the position of chairman of
the board. He has been a member of the Ameren board since 2009.
Chairman, President and Chief Executive Officer, and Director
45
Senior Vice President and Chief Financial Officer
Martin J. Lyons, Jr.
Lyons joined Ameren, Ameren Missouri, CIPS, Genco, and Ameren Services in 2001 as controller. He was elected controller of
CILCO in 2003. He was also elected vice president of Ameren, Ameren Missouri, CIPS, Genco, CILCO, and Ameren Services in
2003 and vice president and controller of IP in 2004. In 2007, his positions at Ameren Missouri were changed to vice
president and principal accounting officer. In 2008, Lyons was elected senior vice president and principal accounting officer of
the Ameren Companies. In 2009, Lyons was also elected chief financial officer of the Ameren Companies. With the Ameren
Illinois Merger in 2010, Lyons remained senior vice president, chief financial officer and principal accounting officer at Ameren
Illinois.
54
Senior Vice President, General Counsel and Secretary
Gregory L. Nelson
Nelson joined Ameren Missouri in 1995 as a manager in the tax department and assumed a similar position with Ameren
Services in 1998. Nelson was elected vice president and tax counsel of Ameren Services in 1999 and vice president of Ameren
Missouri, CIPS, CILCO and Genco in 2003 and of IP in 2004. In 2010, Nelson was elected vice president, tax and deputy
general counsel of Ameren Services. He remained vice president of Ameren Missouri, CIPS, CILCO, IP and Genco. With the
Ameren Illinois Merger in 2010, Nelson remained vice president at Ameren Illinois. Effective March 2, 2011, Nelson was
elected to the positions of senior vice president and general counsel of Ameren, Ameren Missouri, Ameren Illinois, Genco and
Ameren Services. Effective May 1, 2011, Nelson was elected to the position of secretary.
Jerre E. Birdsong
Birdsong joined Ameren Missouri in 1977 and was elected treasurer of Ameren Missouri in 1993. He was elected treasurer of
Ameren, CIPS, and Ameren Services in 1997 and of Genco in 2000. In addition to being treasurer, in 2001 he was elected vice
president at Ameren, Ameren Missouri, CIPS, Ameren Services and Genco. Additionally, he was elected vice president and
treasurer of CILCO in 2003 and of IP in 2004. With the Ameren Illinois Merger in 2010, Birdsong, remained vice president and
treasurer at Ameren Illinois.
Vice President and Treasurer
57
27
SUBSIDIARIES:
Age Positions and Offices Held
50
Name
Warner L. Baxter
Baxter joined Ameren Missouri in 1995. He was elected senior vice president, finance, of Ameren, Ameren Missouri, CIPS,
Ameren Services, and Genco in 2001 and of CILCO in 2003. Baxter was elected to the positions of executive vice president and
chief financial officer of Ameren, Ameren Missouri, CIPS, Genco, CILCO and Ameren Services in 2003 and of IP in 2004. He
was elected chairman, president, chief executive officer and chief financial officer of Ameren Services in 2007. In 2009, Baxter
was elected chairman, president and chief executive officer of Ameren Missouri; at that time, he relinquished his other
positions.
Chairman, President and Chief Executive Officer (Ameren Missouri)
Maureen A. Borkowski
Borkowski joined Ameren Missouri in 1981. She left the company in 2000 before rejoining Ameren in 2005. Borkowski has led
Ameren’s transmission operations since 2005 as vice president, transmission, of Ameren Services. In 2010, Borkowski was
elected president and chief executive officer of ATX. Effective March 2, 2011, Borkowski was elected chairman of ATX.
Effective April 26, 2011, she was also elected senior vice president, transmission, of Ameren Services.
Chairman, President and Chief Executive Officer (ATX)
54
58
Scott A. Cisel
Cisel joined CILCO in 1975. He was named senior vice president and leader of CILCO’s Sales and Marketing Business Unit in
2001. Cisel assumed the positions of vice president and chief operating officer of CILCO in 2003, upon Ameren’s acquisition of
that company. In 2004, Cisel was elected vice president of Ameren Missouri and president and chief operating officer of CIPS,
CILCO and IP. In 2007, Cisel was elected chairman and chief executive officer of CIPS, CILCO and IP, in addition to his
position as president. He relinquished his position at Ameren Missouri in 2007. With the Ameren Illinois Merger in 2010, Cisel
remained chairman, president and chief executive officer at Ameren Illinois.
Chairman, President and Chief Executive Officer (Ameren Illinois)
Daniel F. Cole
Cole joined Ameren Missouri in 1976. He was elected senior vice president of Ameren Missouri and Ameren Services in 1999
and of CIPS in 2001. He was elected president of Genco in 2001; he relinquished that position in 2003. He was elected senior
vice president of CILCO in 2003 and of IP in 2004. In 2009, Cole was elected chairman, president and chief executive officer of
Ameren Services and remained senior vice president of Ameren Missouri, CIPS, CILCO and IP. With the Ameren Illinois
Merger in 2010, Cole remained senior vice president at Ameren Illinois.
Chairman, President and Chief Executive Officer (Ameren Services)
58
Adam C. Heflin
Heflin joined Ameren Missouri in 2005 as vice president of nuclear operations and was elected senior vice president and chief
nuclear officer of Ameren Missouri in 2008.
Senior Vice President and Chief Nuclear Officer (Ameren Missouri)
47
Richard J. Mark
Mark joined Ameren Services in 2002 as vice president of customer service. In 2003, he was elected vice president of
governmental policy and consumer affairs at Ameren Services, with responsibility for government affairs, economic
development and community relations for Ameren’s operating utility companies. He was elected senior vice president,
customer operations of Ameren Missouri in 2005, with responsibility for Missouri energy delivery. In 2007, Mark relinquished
his position at Ameren Services.
Senior Vice President (Ameren Missouri)
56
Michael L. Moehn
Moehn joined Ameren Services in 2000. He was named director of Ameren Services’ corporate modeling and transaction
support in 2001 and elected vice president of business services for AER in 2002. In 2004, Moehn was elected vice president of
corporate planning of Ameren Services and relinquished his position at AER. In 2008, he was elected senior vice president,
corporate planning and business risk management of Ameren Services. Effective January 1, 2012, Moehn relinquished his
position at Ameren Services and was elected senior vice president of customer operations of Ameren Illinois.
Senior Vice President (Ameren Illinois) (Effective January 1, 2012)
42
59
Senior Vice President (Ameren Missouri)
Charles D. Naslund
Naslund joined Ameren Missouri in 1974. He was elected vice president of power operations at Ameren Missouri in 1999, vice
president of Ameren Services in 2000 and vice president of nuclear operations at Ameren Missouri in 2004. He relinquished
his position at Ameren Services in 2001. Naslund was elected senior vice president and chief nuclear officer at Ameren
Missouri in 2005. In 2008, he was elected chairman, president and chief executive officer of AER and chairman and president
of Genco. Naslund relinquished his positions at Ameren Missouri in 2008. Effective March 2, 2011, Naslund assumed the
position of senior vice president, generation and environmental projects of Ameren Missouri and relinquished his positions of
chairman, president and chief executive officer of AER and chairman and president of Genco.
28
Name
Steven R. Sullivan
Age Positions and Offices Held
51
Chairman, President and Chief Executive Officer (AER); Chairman and
President (Genco); and President and Chief Executive Officer
(Marketing Company)
Sullivan joined Ameren, Ameren Missouri, CIPS and Ameren Services in 1998 as vice president, general counsel and secretary.
He added those positions at Genco in 2000. In 2003, Sullivan was elected vice president, general counsel and secretary of
CILCO. He was elected senior vice president, general counsel and secretary of Ameren, Ameren Missouri, CIPS, Genco, CILCO
and Ameren Services in 2003 and of IP in 2004. With the Ameren Illinois Merger in 2010, Sullivan remained senior vice
president, general counsel and secretary at Ameren Illinois. Effective March 2, 2011, Sullivan was elected to the positions of
chairman, president and chief executive officer of AER and chairman and president of Genco and relinquished his positions of
senior vice president and general counsel of Ameren, Ameren Missouri, Ameren Illinois, Genco and Ameren Services. Effective
May 1, 2011, Sullivan relinquished his position as secretary for the Ameren Companies. Effective October 31, 2011, Sullivan
was elected to the positions of president and chief executive officer of Marketing Company.
Officers are generally elected or appointed annually by the respective board of directors of each company, following the
election of board members at the annual meetings of shareholders. No special arrangement or understanding exists between
any of the above-named executive officers and the Ameren Companies nor, to our knowledge, with any other person or
persons pursuant to which any executive officer was selected as an officer. There are no family relationships among the
officers. All of the above-named executive officers have been employed by an Ameren company for more than five years in
executive or management positions.
PART II
ITEM 5. MARKET FOR REGISTRANTS’ COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES.
Ameren’s common stock is listed on the NYSE (ticker symbol: AEE). Ameren common shareholders of record totaled
63,531 on January 31, 2012. The following table presents the price ranges, closing prices, and dividends declared per Ameren
common share for each quarter during 2011 and 2010.
High
Low
Close
Dividends Declared
AEE 2011 Quarter Ended:
March 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
June 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
AEE 2010 Quarter Ended:
March 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
June 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
29.14
30.14
31.44
34.11
28.27
26.92
28.99
29.89
$
$
26.46
27.78
25.55
27.98
24.14
23.09
23.45
27.65
$
$
28.07
28.84
29.77
33.13
26.08
23.77
28.40
28.19
38 1⁄2¢
38 1⁄2
38 1⁄2
40
38 1⁄2¢
38 1⁄2
38 1⁄2
38 1⁄2
There is no trading market for the common stock of Ameren Missouri, Ameren Illinois and Genco. Ameren holds all
outstanding common stock of Ameren Missouri and Ameren Illinois; AER holds all outstanding common stock of Genco.
The following table sets forth the quarterly common stock dividend payments made by Ameren and its subsidiaries
during 2011 and 2010:
(In millions)
Registrant
2011
Quarter Ended
2010
Quarter Ended
December 31
September 30
June 30 March 31
December 31
September 30
June 30 March 31
Ameren Missouri
. . . . . .
Ameren Illinois . . . . . . . .
Ameren . . . . . . . . . . . . . .
$
184
89
96
$
84
88
93
$
67
88
93
$
68
62
93
$
59
33
92
$
60
33
93
$
58
34
92
$
58
33
91
On February 10, 2012, the board of directors of Ameren declared a quarterly dividend on Ameren’s common stock of 40
cents per share. The common share dividend is payable March 30, 2012, to stockholders of record on March 14, 2012.
For a discussion of restrictions on the Ameren Companies’ payment of dividends, see Liquidity and Capital Resources in
Management’s Discussion and Analysis of Financial Condition and Results of Operations under Part II, Item 7, of this report.
29
Purchases of Equity Securities
The following table presents Ameren Corporation’s purchases of equity securities reportable under Item 703 of Regulation
S-K:
Period
(a) Total Number
of Shares (or Units)
Purchased(a)
(b) Average Price
Paid per Share
(or Unit)
(c) Total Number of Shares
(or Units) Purchased As
Part of Publicly
Announced
Plans or Programs
(d) Maximum Number
(or Approximate Dollar Value)
of Shares (or Units) That
May Yet Be Purchased
Under the
Plans or Programs
October 1 – October 31, 2011 . . . . . .
November 1 – November 30, 2011 . .
December 1 – December 31, 2011 . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . .
-
3,201
2,477
5,678
$
-
32.30
32.03
$
32.18
-
-
-
-
-
-
-
-
(a)
Included in November were 3,201 shares of Ameren common stock purchased in open-market transactions pursuant to Ameren’s 2006
Omnibus Incentive Compensation Plan in satisfaction of Ameren’s obligation to distribute shares of common stock for vested performance
units. Included in December were 2,477 shares of Ameren common stock purchased in open market transactions pursuant to Ameren’s 2006
Omnibus Incentive Compensation Plan in satisfaction of Ameren’s obligations for Ameren board of directors’ compensation awards. Ameren
does not have any publicly announced equity securities repurchase plans or programs.
Ameren Missouri, Ameren Illinois and Genco did not purchase equity securities reportable under Item 703 of Regulation
S-K during the period from October 1, 2011 to December 31, 2011.
Performance Graph
The following graph shows Ameren’s cumulative total shareholder return during the five years ended December 31, 2011.
The graph also shows the cumulative total returns of the S&P 500 Index and the Edison Electric Institute Index (EEI Index),
which comprises most investor-owned electric utilities in the United States. The comparison assumes that $100 was invested
on December 31, 2006, in Ameren common stock and in each of the indices shown, and it assumes that all of the dividends
were reinvested.
$125
$100
$75
$50
2006
2007
2008
AEE
2009
2010
2011
S&P 500
EEI Index
December 31,
2006
2007
2008
2009
2010
2011
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
S&P 500 Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
EEI Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
100
100
100
$
105.94
105.49
116.56
$
69.30
66.46
86.37
$
61.87
84.04
95.62
$ 66.11
96.70
102.35
$ 81.82
98.74
122.81
Ameren management cautions that the stock price performance shown in the graph above should not be considered
indicative of potential future stock price performance.
30
ITEM 6. SELECTED FINANCIAL DATA.
For the years ended December 31,
(In millions, except per share amounts)
Ameren(a):
2011
2010
2009
2008
2007
Operating revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income attributable to Ameren Corporation . . . . . . . . . . . . . . . . . . . . .
Common stock dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Earnings per share – basic and diluted . . . . . . . . . . . . . . . . . . . . . . . . . . .
Common stock dividends per share . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
As of December 31:
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, excluding current maturities . . . . . . . . . . . . . . . . . . . . . .
Preferred stock subject to mandatory redemption . . . . . . . . . . . . . . . . . . .
Total Ameren Corporation stockholders’ equity . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Operating revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income available to common stockholder . . . . . . . . . . . . . . . . . . . . . .
Dividends to parent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
As of December 31:
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, excluding current maturities . . . . . . . . . . . . . . . . . . . . . .
Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Operating revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income from continuing operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income available to common stockholder . . . . . . . . . . . . . . . . . . . . . .
Dividends to parent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
As of December 31:
Total assets(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, excluding current maturities . . . . . . . . . . . . . . . . . . . . . .
Preferred stock subject to mandatory redemption . . . . . . . . . . . . . . . . . . .
Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
Operating revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating income(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to Ameren Energy Generating Company . .
Dividends to parent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
As of December 31:
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, excluding current maturities . . . . . . . . . . . . . . . . . . . . . .
Subordinated intercompany notes (current) . . . . . . . . . . . . . . . . . . . . . . .
Total Ameren Energy Generating Company stockholder’s equity . . . . . . . .
$
$
$
$
$
$
$
$
7,531
1,241
519
375
2.15
1.555
23,645
6,677
-
7,919
3,383
609
287
403
12,757
3,772
4,037
2,787
458
196
193
327
7,213
1,657
-
2,452
1,066
139
44
-
2,572
824
-
1,018
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
7,638
916
139
368
0.58
1.54
23,511
6,853
-
7,730
3,197
711
364
235
12,504
3,949
4,153
3,014
498
212
248
133
7,406
1,657
-
2,576
1,126
62
(39)
-
2,607
824
-
998
7,135
1,416
612
338
2.78
1.54
23,702
7,111
-
7,856
2,874
566
259
175
12,219
4,018
4,057
2,984
363
133
241
98
8,298
1,847
-
3,072
1,148
324
160
43
2,920
823
176
1,004
$
$
$
$
$
$
$
$
7,869
1,362
605
534
2.88
2.54
22,671
6,554
-
6,963
2,960
514
245
264
11,529
3,673
3,562
3,508
191
41
87
60
8,023
1,850
-
2,655
1,422
551
286
221
2,592
774
145
868
$
$
$
$
$
$
$
$
7,562
1,359
618
527
2.98
2.54
20,752
5,689
16
6,752
2,961
590
336
267
10,903
3,208
3,601
3,380
195
56
114
101
7,101
1,618
16
2,635
1,298
468
230
199
2,288
474
172
857
(a)
(b)
(c)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
Includes “Goodwill, impairment and other charges” of $125 million and $589 million recorded at Ameren and $35 million and $170 million
recorded at Genco, during the years ended December 31, 2011, and December 31, 2010, respectively. Includes “Loss from regulatory
disallowance” of $89 million recorded at Ameren Missouri during the year ended December 31, 2011.
Includes total assets from discontinued operations of $1,117 million, $1,081 million, and $865 million at December 31, 2009, 2008, and 2007,
respectively.
31
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
OVERVIEW
Ameren Executive Summary
Operations
During 2011, Ameren remained committed to
providing its customers with safe, reliable, environmentally
responsible and reasonably-priced energy while at the same
time enhancing value for our shareholders. Ameren
Missouri and Ameren Illinois seek to earn competitive
returns on their investments by improving their regulatory
frameworks and seeking rate increases as needed.
Ameren’s Merchant Generation business seeks to protect
and enhance shareholder value by minimizing operating and
capital spending during the current period of low power
prices while advocating for regulatory policies and power
market improvements that will lead to improved economics.
Ameren is committed to allocating capital to projects that
have an opportunity to earn a competitive return and to
aligning its spending with regulatory outcomes and
economic conditions.
There were several developments during 2011 and
early 2012 that have the potential to improve the level or
predictability of earned returns at Ameren Missouri and
Ameren Illinois. In January 2012, Ameren Illinois elected to
participate in the IEIMA’s performance-based formula
ratemaking process for electric delivery service. As a result,
Ameren Illinois’ electric delivery service earnings in 2012
and beyond are expected to reflect performance-based
formula ratemaking, which will enable additional
infrastructure investment and the creation of jobs. The
improved infrastructure will enhance reliability and provide
customers with the energy usage options made possible by
smart meters. Also in January 2012, the ICC approved an
increase in annual Ameren Illinois’ revenues for natural gas
delivery service. In 2011, Ameren Missouri received rate
increases for its electric and natural gas businesses. In
February 2012, Ameren Missouri filed an electric rate case
with the MoPSC seeking to recover its operating and capital
costs and to earn a fair return on investments made to
serve its customers. In addition to that pending electric rate
case, in January 2012, Ameren Missouri filed its first
request with the MoPSC for approval of new and expanded
energy efficiency programs along with a cost-recovery
mechanism under the MEEIA. The MEEIA was designed to
enable utilities to pursue cost effective energy efficiency
programs by aligning the utility’s financial incentives with
those of its customers. Also, FERC is expected to issue an
order on MISO’s proposal to establish a capacity market
within the RTO. The MISO proposal calls for the first annual
capacity auction to be held in April 2013 for the June 2013
to May 2014 planning year. Ameren supports the MISO
proposal as well as MISO’s efforts to increase the amount
of capacity that can be shared between MISO and PJM.
Ameren will continue to advocate for a multi-year capacity
construct to improve the functioning of power markets. The
creation of a MISO capacity market would more accurately
reflect the value of capacity, improve efficiency and
reliability, and benefit customers over the long-term.
The Merchant Generation segment expects its cash flows
from operating activities to exceed capital expenditures in
2012 reflecting the benefit of its forward power sales and
hedging programs as well as actions taken to reduce
spending. In early 2012, there has been a sharp decline in
forward power prices. The decline in power prices is believed
to be caused by factors such as declining natural gas prices
and the stay of the CSAPR. It is unclear when legal and
regulatory uncertainties related to CSAPR will be resolved and
when natural gas prices will recover. As a result of the
declining price of power, Merchant Generation and Genco
have revised their capital spending plans. Genco is
decelerating construction of its Newton energy center
scrubber project, postponing installation until such time as
the incremental investment necessary for completion is
justified by visible market conditions. In addition, AERG has
removed from its five-year capital expenditure plans the
previously planned precipitator upgrades at its E.D. Edwards
energy center. Merchant Generation believes these actions are
the best path to achieving appropriate returns on incremental
environmental investments during this period of low power
prices. These Merchant Generation actions will reduce capital
needs by approximately $270 million from 2012 through 2014
compared to prior plans. Genco will decelerate the Newton
scrubber project in a manner that preserves the value of the
work commissioned to date. Genco has reduced its expected
2012 capital expenditures for the Newton scrubber project to
approximately $150 million. After 2012, Genco will perform
minimal amounts of ongoing construction activities such that
when the economics merit completing the Newton scrubber
project, the project can be completed in an orderly and cost-
effective manner.
Ameren plans to significantly grow its investment in
electric transmission assets, which are regulated by FERC.
Ameren expects to invest a total of approximately
$1.7 billion in transmission projects over the five-year
period ending in 2016. Of that total, Ameren Illinois expects
to invest $900 million in transmission projects that are
focused on local load growth and reliability needs. In
December 2011, MISO approved the Illinois Rivers, Spoon
River, and Mark Twain projects. ATX and ATXI’s total
investment in these three MISO-approved projects is
expected to be more than $1.2 billion through 2019, with
potential investment of approximately $750 million from
2012 to 2016. In 2012, ATXI is moving forward with the line
routing and siting process for the Illinois Rivers project.
Earnings
Ameren reported net income of $519 million, or $2.15
per share, for 2011 compared with net income of
$139 million, or 58 cents per share, in 2010. The main
factor contributing to the increase in earnings in 2011
compared with 2010 was a reduction in goodwill,
impairment and other charges of $464 million, or $1.87 per
share. The 2011 charges were the result of the MoPSC’s
July 2011 disallowance of costs of enhancements related to
the rebuilding of Ameren Missouri’s Taum Sauk energy
32
center in excess of amounts recovered from property
insurance, as well as new environmental rules, the primary
impact of which was Genco’s closure of the Meredosia and
Hutsonville energy centers. Ameren’s earnings also
increased in 2011, compared with 2010, because of higher
electric utility rates for Ameren Missouri and Ameren Illinois
and lower interest expense. Offsetting factors included
reduced electric margins in the Merchant Generation
segment due to lower realized power prices and higher fuel
and transportation-related expenses; lower electric sales to
native load utility customers due, in part, to summer
temperatures that while warmer than normal, were below
those of a very hot 2010; unrealized net losses on MTM
activity related to nonqualifying power hedges and fuel-
related contracts; and higher major storm repair expenses.
Additionally, Ameren recorded a charge to earnings
associated with the voluntary separation offers to eligible
Ameren Missouri and Ameren Services employees during
the fourth quarter of 2011.
Liquidity
Cash flows from operations of $1.9 billion were used
to pay dividends to common stockholders of $375 million
and to fund capital expenditures of $1.0 billion. At
December 31, 2011, Ameren, on a consolidated basis, had
available liquidity, in the form of cash on hand and amounts
available under its existing credit facilities, of approximately
$2.2 billion, which was a $300 million increase in the
amount of available liquidity at December 31, 2010.
Capital Spending
From 2012 through 2016, Ameren’s cumulative capital
spending is projected to range between $6.5 billion and
$8.3 billion. Much of this spending is at Ameren’s rate-
regulated utilities, including a total of approximately
$750 million at ATX and ATXI, in the aggregate, to invest in
their electric transmission assets. The Merchant Generation
segment’s capital spending is expected to be up to $450
million, primarily for environmental compliance, from 2012
through 2016. The decision to make pollution control
equipment investments in Ameren’s Merchant Generation
segment depends on whether the expected future market
price for power reflects the increased cost of environmental
compliance.
General
Ameren, headquartered in St. Louis, Missouri, is a
public utility holding company under PUHCA 2005,
administered by FERC. Ameren’s primary assets are the
common stock of its subsidiaries. Ameren’s subsidiaries
are separate, independent legal entities with separate
businesses, assets, and liabilities. These subsidiaries
operate, as the case may be, rate-regulated electric
generation, transmission, and distribution businesses, rate-
regulated natural gas transmission and distribution
businesses, and merchant electric generation businesses in
Missouri and Illinois. Dividends on Ameren’s common
stock and the payment of other expenses by Ameren
depend on distributions made to it by its subsidiaries.
Ameren’s principal subsidiaries are listed below. See
Note 1 – Summary of Significant Accounting Policies under
Part II, Item 8, of this report for a detailed description of our
principal subsidiaries.
‰
‰
‰
Ameren Missouri operates a rate-regulated electric
generation, transmission and distribution business, and
a rate-regulated natural gas transmission and
distribution business in Missouri.
Ameren Illinois operates a rate-regulated electric and
natural gas transmission and distribution business in
Illinois.
AER consists of non-rate-regulated operations,
including Genco, AERG, Marketing Company and
Medina Valley. The Medina Valley energy center was
sold in February 2012. Genco operates a merchant
electric generation business in Illinois and holds an
80% ownership interest in EEI.
On October 1, 2010, Ameren, CIPS, CILCO, IP, AERG
and AER completed a two-step corporate internal
reorganization. The first step of the reorganization was the
Ameren Illinois Merger. Upon consummation of the Ameren
Illinois Merger, the separate legal existence of CILCO and IP
ended. The second step of the reorganization involved the
distribution of AERG stock from Ameren Illinois to Ameren
and the subsequent contribution by Ameren of the AERG
stock to AER. The Ameren Illinois Merger and the
distribution of AERG stock were accounted for as
transactions between entities under common control. In
accordance with authoritative accounting guidance, assets
and liabilities transferred between entities under common
control were accounted for at the historical cost basis of the
common parent, Ameren, as if the transfer had occurred at
the beginning of the earliest reporting period presented.
Ameren’s historical cost basis in Ameren Illinois included
purchase accounting adjustments related to Ameren’s
acquisition of CILCORP in 2003. Ameren Illinois accounted
for the AERG distribution as a spinoff. Ameren Illinois
transferred AERG to Ameren based on AERG’s carrying
value. Ameren Illinois has segregated AERG’s operating
results and cash flows and presented them separately as
discontinued operations in its consolidated statement of
income and consolidated statement of cash flows,
respectively, for all periods presented prior to October 1,
2010, in this report. For Ameren’s financial statements,
AERG’s results of operations remain classified as
continuing operations. See Note 16 – Corporate
Reorganization and Discontinued Operations under Part II,
Item 8, for additional information.
Effective January 1, 2010, as part of an internal
reorganization, AER transferred its 80% stock ownership
interest in EEI to Genco through a capital contribution. The
transfer of EEI to Genco was accounted for as a transaction
between entities under common control, whereby Genco
accounted for the transfer at the historical carrying value of
the parent (Ameren) as if the transfer had occurred at the
beginning of the earliest reporting period presented.
Ameren’s historical cost basis in EEI included purchase
33
accounting adjustments relating to Ameren’s acquisition of
an additional 20% ownership interest in EEI in 2004. This
transfer required Genco’s prior-period financial statements
to be retrospectively combined for all periods presented.
Consequently, Genco’s prior-period consolidated financial
statements reflect EEI as if it had been a subsidiary of
Genco. Ameren and Genco consolidate EEI for financial
reporting purposes.
The financial statements of Ameren are prepared on a
consolidated basis and therefore include the accounts of its
majority-owned subsidiaries. All significant intercompany
transactions have been eliminated. All tabular dollar
amounts are in millions, unless otherwise indicated.
In addition to presenting results of operations and
earnings amounts in total, we present certain information in
cents per share. These amounts reflect factors that directly
affect Ameren’s earnings. We believe this per share
information helps readers to understand the impact of these
factors on Ameren’s earnings per share. All references in
this report to earnings per share are based on average
diluted common shares outstanding.
RESULTS OF OPERATIONS
Earnings Summary
Our results of operations and financial position are
affected by many factors. Weather, economic conditions,
and the actions of key customers or competitors can
significantly affect the demand for our services. Our results
are also affected by seasonal fluctuations: winter heating
and summer cooling demands. The vast majority of
Ameren’s revenues are subject to state or federal regulation.
This regulation has a material impact on the price we
charge for our services. Merchant Generation sales are also
subject to market conditions for power. We principally use
coal, nuclear fuel, natural gas, and oil for fuel in our
operations. The prices for these commodities can fluctuate
significantly due to the global economic and political
environment, weather, supply and demand, and many other
factors. We have natural gas cost recovery mechanisms for
our Illinois and Missouri natural gas delivery service
businesses, a purchased power cost recovery mechanism
for our Illinois electric delivery service business, and a FAC
for our Missouri electric utility business. Fluctuations in
interest rates and conditions in the capital and credit
markets affect our cost of borrowing and our pension and
postretirement benefits costs. We employ various risk
management strategies to reduce our exposure to
commodity risk and other risks inherent in our business.
The reliability of our energy centers and transmission and
distribution systems and the level of purchased power
costs, operations and maintenance costs, and capital
investment are key factors that we seek to control to
optimize our results of operations, financial position, and
liquidity.
Net income attributable to Ameren Corporation was
$519 million, or $2.15 per share, for 2011, $139 million, or
$0.58 per share, for 2010, and $612 million, or $2.78 per
share, for 2009.
2011 versus 2010
Net income attributable to Ameren Corporation
increased $380 million, and earnings per share increased
$1.57 in 2011 compared with 2010. The Merchant
Generation segment reported net income attributable to
Ameren Corporation of $45 million in 2011, compared with
a $409 million net loss in 2010. Net income attributable to
Ameren Corporation decreased in the Ameren Missouri and
Ameren Illinois Regulated segments by $77 million and
$15 million, respectively, in 2011 compared with 2010.
Compared with 2010 earnings per share, 2011
earnings were favorably affected by:
‰
‰
‰
‰
‰
‰
‰
reduced goodwill, impairment and other charges in the
Merchant Generation segment offset, in part, by a
charge to earnings related to the MoPSC’s July 2011
disallowance of costs of enhancements relating to the
rebuilding of the Taum Sauk energy center in excess of
amounts recovered from property insurance ($1.87 per
share);
higher Ameren Missouri electric rates pursuant to
orders issued by the MoPSC, which became effective in
June 2010 and in July 2011, as well as higher Ameren
Missouri natural gas rates pursuant to a MoPSC order,
which became effective in late February 2011. The
impact of the Ameren Missouri electric rate increases
on earnings was reduced by the adoption of life span
depreciation methodology, recognition in 2010 of
regulatory assets for previously-expensed costs in the
prior-year period, and increased regulatory asset
amortization as directed by the rate orders (17 cents
per share). These amounts exclude the unfavorable
impact of the charge to earnings related to the
MoPSC’s disallowance of Taum Sauk rebuilding costs
discussed above;
lower interest expense, primarily due to the maturity
and repayment of $200 million of Genco’s senior
secured notes in November 2010, the redemption of
$66 million of Ameren Missouri’s subordinated
deferrable interest debentures in September 2010,
Ameren Illinois’ redemptions of $150 million of senior
secured notes and $40 million of first mortgage bonds
in June 2011 and September 2010, respectively, and a
reduction in borrowings under credit facility
agreements (12 cents per share);
higher Ameren Illinois electric rates pursuant to orders
issued by the ICC in 2010 (6 cents per share);
the absence in 2011 of a charge for the impact on
deferred taxes from changes in federal health care laws
(6 cents per share);
the absence in 2011 of charges recorded in 2010 for
cancelled or unrecoverable projects at Ameren Missouri
(6 cents per share);
a reduction in operations and maintenance expense
related to plant maintenance, primarily at Ameren
Missouri, as fewer costs were incurred for major
outages at coal-fired energy centers as the scope of the
outages in 2011 was not as extensive as the scope of
the outages conducted in 2010 (5 cents per share); and
34
‰
reduction in expense as a result of disciplined cost
management efforts to align spending with regulatory
outcomes and economic conditions.
Compared with 2010 earnings per share, 2011
earnings were unfavorably affected by:
‰
lower electric margins in the Merchant Generation
segment, largely due to lower realized revenue per
megawatthour sold and higher fuel and related
transportation costs (21 cents per share). This amount
excludes the unfavorable impacts of net unrealized
MTM activity discussed below. See Outlook for
expected trends in future coal, transportation and
power prices;
reduced rate-regulated retail sales volumes, excluding
the effects of abnormal weather, as sales volumes
declined due to continued economic pressure, energy
efficiency measures, and customer conservation efforts
as well as lower wholesale sales at Ameren Missouri
due to a reduction in customers and the expiration of
favorably priced contracts, among other items
(15 cents per share);
unrealized net losses on MTM activity primarily related
to nonqualifying power hedges and fuel-related
contracts as well as unfavorable changes in the market
value of investments used to support Ameren’s
deferred compensation plans (10 cents per share);
the impact of weather conditions on electric and natural
gas demand (estimated at 10 cents per share);
increased operations and maintenance expenses as a
result of major storms in 2011 (9 cents per share);
a reduction in allowance for equity funds used during
construction reflecting the 2010 completion of two
scrubbers at Ameren Missouri’s Sioux energy center
(8 cents per share);
increased operations and maintenance expenses
associated with voluntary separation offers to eligible
Ameren Missouri and Ameren Services employees
during the fourth quarter of 2011 (7 cents per share);
a reduction in revenues resulting from the MoPSC’s
April 2011 order with respect to its FAC review for the
period from March 1, 2009, to September 30, 2009,
that resulted in Ameren Missouri recording an
obligation to refund to its electric customers the
earnings associated with certain previously recognized
sales. See Note 2 – Rate and Regulatory Matters under
Part II, Item 8, of this report for additional information
(5 cents per share); and
an increase in depreciation and amortization expense
caused primarily by the installation of scrubbers at
Ameren Missouri’s Sioux energy center as well as other
capital additions (4 cents per share).
‰
‰
‰
‰
‰
‰
‰
‰
The cents per share information presented above is
based on average shares outstanding in 2010.
2010 versus 2009
Net income attributable to Ameren Corporation
decreased $473 million, and its earnings per share
decreased $2.20 in 2010 compared with 2009. Net income
attributable to Ameren Corporation increased in the Ameren
Missouri and Ameren Illinois Regulated segments by
$105 million and $81 million, respectively, in 2010
compared with 2009, while net income attributable to
Ameren Corporation in the Merchant Generation segment
decreased by $656 million in 2010 compared with 2009.
Compared with 2009 earnings per share, 2010
earnings were negatively affected by:
‰
the 2010 impairment of goodwill, intangible assets, and
long-lived assets within the Merchant Generation
segment due to the sustained decline in market prices
for electricity, industry market multiples becoming
observable at lower levels than previously estimated,
and potentially more stringent environmental
regulations ($2.19 per share);
lower realized electric margins in the Merchant
Generation segment largely due to lower realized revenue
per megawatthour sold and higher fuel and related
transportation costs (79 cents per share). This amount
excludes the unfavorable impacts of net unrealized MTM
activity on nonqualifying power hedges discussed below;
higher dilution (23 cents per share) caused by an
increase in the average number of common shares
outstanding, largely because of a September 2009
common stock issuance, the proceeds of which were
used to make investments in Ameren’s rate-regulated
utilities. The impact of dilution was offset by higher
earned returns on investments at Ameren’s rate-
regulated utilities and lower financing costs;
costs associated with the Callaway energy center’s
scheduled refueling and maintenance outage in 2010.
There was no Callaway refueling and maintenance
outage in 2009 (12 cents per share);
increased depreciation and amortization expenses,
primarily due to capital additions placed in service at
the Merchant Generation segment in late 2009 and
early 2010, excluding the impacts at Ameren Missouri
of the May 2010 MoPSC electric rate order discussed
below (9 cents per share);
a reduced gain from net unrealized MTM activity on
nonqualifying power hedges and from changes in the
market value of investments used to support Ameren’s
deferred compensation plans (6 cents per share); and
the impact on deferred taxes from changes in federal
health care laws (6 cents per share).
Compared with 2009 earnings per share, 2010
‰
‰
‰
‰
‰
‰
earnings were favorably affected by:
‰
the impact of weather conditions on energy demand
(estimated at 40 cents per share);
higher Ameren Missouri electric rates pursuant to the
MoPSC 2009 and 2010 electric rate orders effective in
May 2009 and in June 2010, respectively, offset by the
adoption of the life span depreciation methodology and
increased regulatory asset amortization as directed by
the MoPSC 2010 electric rate order (27 cents per share);
the favorable impact on electric and natural gas
margins in our rate-regulated businesses from higher
weather-normalized sales volumes (exclusive of higher
sales to Noranda discussed below), largely due to
‰
‰
35
improved economic conditions and higher wholesale
sales margins at Ameren Missouri because of
additional customers and higher-priced wholesale sales
contracts, among other things (20 cents per share);
increased Ameren Missouri sales to Noranda as its
smelter plant gradually returned to full capacity by the
end of the first quarter of 2010 after a January 2009
severe ice storm significantly reduced the plant’s
capacity (11 cents per share);
a reduction in financing expenses caused primarily by
an increase in the allowance for funds used during
construction at Ameren Missouri for the installation of
two scrubbers at its Sioux energy center (10 cents per
share);
higher Ameren Illinois electric and natural gas net
delivery rates pursuant to the ICC 2010 rate orders,
‰
‰
‰
‰
which became effective in May and November 2010
(9 cents per share); and
reduced charges in 2010 relating to workforce
reductions through voluntary and involuntary
separation programs (4 cents per share).
The cents per share information presented above is
based on average shares outstanding in 2009.
For additional details regarding the Ameren
Companies’ results of operations, including explanations of
Margins, Other Operations and Maintenance Expenses,
Goodwill, Impairment and Other Charges, Depreciation and
Amortization, Taxes Other Than Income Taxes, Interest
Charges, and Income Taxes, see the major headings below.
Below is a table of income statement components by segment for the years ended December 31, 2011, 2010, and 2009:
Ameren
Illinois
Regulated
Segment
Ameren
Missouri
Merchant
Generation
Other /
Intersegment
Eliminations
Total
2011
Electric margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other operations and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, impairment and other charges . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxes other than income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other income and (expenses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income (taxes) benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest and preferred dividends . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to Ameren Corporation . . . . . . . . . . . . . . .
2010
Electric margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other operations and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, impairment and other charges . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxes other than income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other income and (expenses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income (taxes) benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest and preferred dividends . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to Ameren Corporation . . . . . . . . . . . . . . .
2009
Electric margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other operations and maintenance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, impairment and other charges . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Taxes other than income taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other income and (expenses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income (taxes) benefit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncontrolling interest and preferred dividends . . . . . . . . . . . . . . . . . . . .
$
$
$
$
$
$
$
$
$
$
2,252
79
5
(934)
(89)
(408)
(296)
51
(209)
(161)
290
(3)
287
2,233
75
1
(931)
-
(382)
(285)
70
(213)
(199)
369
(5)
364
1,983
73
4
(880)
-
(357)
(257)
56
(229)
(128)
265
(6)
Net income (loss) attributable to Ameren Corporation . . . . . . . . . . . . . . .
$
259
$
36
1,087
354
1
(640)
-
(215)
(129)
1
(136)
(127)
196
(3)
193
1,096
375
-
(635)
-
(210)
(128)
(6)
(143)
(137)
212
(4)
208
917
373
4
(590)
-
(216)
(125)
2
(153)
(79)
133
(6)
127
$
$
$
668
-
3
(285)
(37)
(143)
(24)
1
(105)
(32)
46
(1)
45
780
-
-
(287)
(589)
(146)
(26)
1
(133)
(6)
(406)
(3)
$
(409)
$ 1,012
-
-
(333)
(7)
(126)
(28)
1
(119)
(151)
249
(2)
247
$
$
$
$
$
$
$
(10)
(2)
(9)
39
1
(19)
(8)
(7)
(1)
10
(6)
-
(6)
(17)
(2)
(1)
32
-
(27)
(10)
(8)
(8)
17
(24)
-
(24)
(22)
-
(8)
35
-
(26)
(10)
(11)
(7)
26
(23)
2
(21)
$
$
$
$
$
$
3,997
431
-
(1,820)
(125)
(785)
(457)
46
(451)
(310)
526
(7)
519
4,092
448
-
(1,821)
(589)
(765)
(449)
57
(497)
(325)
151
(12)
139
3,890
446
-
(1,768)
(7)
(725)
(420)
48
(508)
(332)
624
(12)
612
Margins
The following table presents the favorable (unfavorable) variations in the registrants’ electric and natural gas margins
from the previous year. Electric margins are defined as electric revenues less fuel and purchased power costs. Natural gas
margins are defined as gas revenues less gas purchased for resale. The table covers the years ended December 31, 2011,
2010, and 2009. We consider electric and natural gas margins useful measures to analyze the change in profitability of our
electric and natural gas operations between periods. We have included the analysis below as a complement to the financial
information we provide in accordance with GAAP. However, these margins may not be a presentation defined under GAAP,
and may not be comparable to other companies’ presentations or more useful than the GAAP information we provide
elsewhere in this report.
Electric revenue change:
2011 versus 2010
Effect of weather (estimate)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Regulated rates:
Higher base rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recovery of FAC under-recovery(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Off-system revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
FAC disallowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transmission services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Illinois pass-through power supply costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Energy efficiency programs and environmental remediation cost riders . . . . . . . . .
Bad debt rider . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate-regulated sales (excluding the impact of abnormal weather) . . . . . . . . . . . . . . . .
Wholesale revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation sales price changes, including hedge effect . . . . . . . . . . . . . . . .
Net unrealized MTM losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-rate-regulated sales and other
Ameren
Illinois
Regulated
Segment
Ameren
Missouri
Genco
Other(a)
Ameren
$
(29)
$
(7)
$
-
$
-
$
(36)
172
89
53
(17)
1
-
-
-
(37)
(43)
-
(2)
5
29
-
-
-
(4)
(112)
6
(17)
(15)
-
-
-
(1)
-
-
-
-
-
-
-
-
-
-
(58)
(4)
2
-
-
-
-
3
(1)
-
-
-
-
(3)
(12)
11
201
89
53
(17)
-
(113)
6
(17)
(52)
(43)
(61)
(18)
17
Total electric revenue change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
192
$ (121)
$
(60) $
(2)
$
9
Fuel and purchased power change:
Fuel:
Merchant Generation production volume and other . . . . . . . . . . . . . . . . . . . . . . . . .
Fuel and transportation costs included in base rates . . . . . . . . . . . . . . . . . . . . . . . .
Recovery of FAC under-recovery(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net unrealized MTM losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Price – Merchant Generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation purchased power and other . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Illinois pass-through power supply costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
(84)
(89)
-
-
-
-
$
-
-
-
-
-
-
112
$
(2) $
-
-
(6)
(11)
6
-
$
14
-
-
(2)
(6)
(37)
1
12
(84)
(89)
(8)
(17)
(31)
113
Total fuel and purchased power change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ (173)
$ 112
$ (13) $ (30)
$ (104)
Net change in electric margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas margins change:
Effect of weather (estimate)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Bad debt rider . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in base rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Energy efficiency programs and environmental remediation cost riders . . . . . . . . . . .
Sales (excluding impact of abnormal weather) and other . . . . . . . . . . . . . . . . . . . . . . .
$
$
Net change in natural gas margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
19
(1)
-
5
-
-
4
$
$
$
(9)
$
(73) $
(32)
(5)
(14)
3
(1)
(4)
(21)
$
$
-
-
-
-
-
-
$
$
-
-
-
-
-
-
$
$
$
(95)
(6)
(14)
8
(1)
(4)
(17)
37
Electric revenue change:
2010 versus 2009
Effect of weather (estimate)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Regulated rates:
Higher base rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Recovery of FAC under-recovery(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Off-system revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noranda sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transmission services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Illinois pass-through power supply costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Energy efficiency programs and environmental remediation cost riders . . . . . . . . .
Bad debt rider . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Rate-regulated sales (excluding the impact of abnormal weather) . . . . . . . . . . . . . . .
Wholesale revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . .
Merchant Generation sales price changes, including hedge effect
2007 Illinois Electric Settlement Agreement, net of reimbursement
. . . . . . . . . . . . . .
Net unrealized MTM gains (losses) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Non-rate-regulated sales and other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
Illinois
Regulated
Segment
Ameren
Missouri
Genco
Other(a)
Ameren
$
134
$
40
$
-
$
-
$
174
162
60
(102)
54
7
-
-
-
9
(4)
-
-
-
10
41
-
-
-
42
(83)
29
14
16
-
-
10
-
(13)
-
-
-
-
-
-
-
-
-
-
(81)
10
(1)
50
-
-
-
-
-
303
-
-
-
-
(162)
3
50
(17)
203
60
(102)
54
49
220
29
14
25
(4)
(243)
23
49
30
Total electric revenue change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
330
$
96
$
(22) $
177
$ 581
Fuel and purchased power change:
Fuel:
Merchant Generation production volume and other . . . . . . . . . . . . . . . . . . . . . . . .
Fuel and transportation costs included in base rates . . . . . . . . . . . . . . . . . . . . . . . .
Recovery of FAC under-recovery(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net unrealized MTM losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Price – Merchant Generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation purchased power and other . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Illinois pass-through power supply costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Total fuel and purchased power change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
9
(60)
(29)
-
-
-
(80)
$
$
-
-
-
-
-
-
83
83
$
(38) $
-
-
(18)
(51)
11
-
(9)
-
-
(4)
(20)
50
(303)
$
(47)
9
(60)
(51)
(71)
61
(220)
$
(96) $ (286)
$ (379)
Net change in electric margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 250
$ 179
$ (118) $ (109)
$ 202
Natural gas margins change:
Effect of weather (estimate)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Bad debt rider . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in base rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Energy efficiency programs and environmental remediation cost riders . . . . . . . . . . .
Net unrealized MTM losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales (excluding impact of abnormal weather) and other . . . . . . . . . . . . . . . . . . . . . .
$
Net change in natural gas margins . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
-
-
-
-
2
2
$
$
1
15
(11)
1
(6)
2
$
2
$
-
-
-
-
-
-
-
$
$
-
-
-
-
-
(2)
(2)
$
1
15
(11)
1
(6)
2
$
2
Includes amounts for nonregistrant subsidiaries (largely made up of other Merchant Generation) and intercompany eliminations.
(a)
(b) Represents the estimated margin impact resulting from the effects of changes in cooling and heating degree-days on electric and natural gas
demand compared to the prior-year based on temperature readings from the National Oceanic and Atmospheric Administration.
(c) Represents the change in the net recovery of fuel costs under the FAC recovered from customer rates, with corresponding offsets to fuel
expense.
2011 versus 2010
Ameren
Ameren’s electric margins decreased by $95 million, or
2%, in 2011 compared with 2010. The following items had
an unfavorable impact on Ameren’s electric margins:
‰
Lower sales prices, including hedge effects, at the
Merchant Generation segment due to reductions in
higher-margin sales resulting from the expiration of the
2006 auction power supply agreements on May 31,
2010, and lower market prices resulting in fewer
opportunities for economic power sales, which
decreased margins by $61 million.
‰
‰
‰
Excluding the estimated impact of abnormal weather,
rate-regulated retail sales volumes declined 1%,
attributable to continued economic pressure, energy
efficiency measures and customer conservation efforts,
which decreased revenues by $52 million.
Lower wholesale sales at Ameren Missouri due to a
reduction in customers, the expiration of favorably
priced contracts and the inclusion of revenues from the
remaining contracts as an offset to fuel costs in the
FAC beginning July 31, 2011, which decreased
revenues by $43 million.
Summer weather conditions in 2011 were not as hot as
a very hot 2010, as evidenced by a 4% decrease in
38
cooling degree-days, which decreased revenues by
$36 million. However, weather conditions in Ameren’s
service territory in 2011 were still warmer than normal
as evidenced by 19% more cooling degree-days.
Net unrealized MTM losses principally at the Merchant
Generation segment (primarily at Marketing Company),
related to nonqualifying power hedges and fuel-related
contracts, which decreased margins by $26 million.
Decreased utilization of Merchant Generation’s energy
centers, primarily due to planned and unplanned
outages and lower market prices resulting in fewer
opportunities for economic power sales. Decreased
utilization resulted in a $23 million decline in non-rate-
regulated sales. This decline was mitigated by a
$12 million decrease in Merchant Generation
production volume and other costs.
A $17 million reduction in revenues, recorded in the
second quarter of 2011, at Ameren Missouri resulting
from the MoPSC’s order with respect to its FAC
disallowance for the period from March 1, 2009, to
September 30, 2009. See Note 2 – Rate and Regulatory
Matters under Part II, Item 8, for further information
regarding the FAC prudence review.
Decreased recovery of prior years’ bad debt expense at
Ameren Illinois, through the Illinois bad debt rider,
which became effective in March 2010, which
decreased margins by $17 million. See Operations and
Maintenance in this section for additional information
on a related offsetting decrease in bad debt expense.
6% higher fuel prices in the Merchant Generation
segment, primarily due to higher commodity and
transportation costs associated with new supply
contracts, which decreased margins by $17 million.
‰
‰
‰
‰
‰
The following items had a favorable impact on
Ameren’s electric margins in 2011 compared with 2010:
‰
‰
‰
Higher electric base rates at Ameren Missouri, effective
June 2010 and July 2011, which increased revenues by
$172 million, offset by an increase in net base fuel
expense ($31 million), which was a result of higher net
base fuel cost rates approved in the 2010 and 2011
MoPSC rate orders and due to higher fuel and
transportation costs. Net base fuel expense is the sum
of fuel and transportation costs included in base rates
(-$84 million) and off-system revenues (+$53 million)
in the above table. See below for additional details
regarding the FAC.
Higher electric delivery service rates at Ameren Illinois,
effective in early May and November 2010, which
increased margins by $20 million, and higher wholesale
revenues due to an increase in electric delivery service
rates effective April 2011, which increased margins by
$9 million. See Note 2 – Rate and Regulatory Matters
under Part II, Item 8, for further information regarding
the 2011 wholesale distribution rate case.
Increased recovery of energy efficiency program costs
and environmental remediation costs through Illinois
rate-adjustment mechanisms at Ameren Illinois, which
increased margins by $6 million. See Other Operations
and Maintenance Expenses in this section for
information on a related offsetting increase in energy
efficiency and environmental remediation costs.
Ameren’s revenues associated with Illinois pass-
through power supply costs decreased $113 million
because of lower power prices on sales primarily to
nonaffiliated parties. These revenues were offset by a
corresponding net decrease in purchased power.
Ameren Missouri has a FAC cost recovery mechanism
that allows Ameren Missouri to recover, through customer
rates, 95% of changes in fuel and purchased power costs,
net of off-system revenues, including MISO costs and
revenues, greater or less than the amount set in base rates,
without a traditional rate proceeding. Ameren Missouri
accrued, as a regulatory asset, fuel and purchased power
costs that were greater than the amount set in base rates
(FAC under-recovery). Net recovery of fuel costs under the
FAC through customer rates increased by $89 million in
2011, as compared with 2010, with corresponding offsets
to fuel expense to reduce the previously recognized FAC
regulatory asset. See below for explanations of electric and
natural gas margin variances for the Ameren Missouri
segment.
Ameren’s natural gas margins decreased by
$17 million, or 4%, in 2011 compared with 2010. The
following items had an unfavorable impact on Ameren’s
natural gas margins:
‰
‰
‰
Decreased recovery of prior years’ bad debt expense
through the Illinois bad debt rider at Ameren Illinois,
which became effective March 2010, decreased
margins by $14 million. See Other Operations and
Maintenance Expenses in this section for additional
information on a related offsetting decrease in bad debt
expense.
Unfavorable winter weather conditions, as evidenced by
a 6% decrease in heating degree-days, which
decreased revenues by $6 million. Compared to
normal, Ameren experienced 3% fewer heating degree-
days in 2011.
4% lower native load sales volumes, excluding the
estimated impact of abnormal weather, largely in the
commercial and industrial sectors, attributable to
continued economic pressure decreased margins by
$4 million.
Ameren’s natural gas margins were favorably affected
by $8 million in 2011 compared with 2010 due to higher
natural gas rates effective February 2011 at Ameren
Missouri and effective in May and November 2010 at
Ameren Illinois.
Ameren Missouri
Ameren Missouri has a FAC cost recovery mechanism,
which is outlined in the Ameren margin section above.
Ameren Missouri’s electric margins increased by
$19 million, or 1%, in 2011 compared with 2010. Ameren
Missouri’s electric margins were favorably affected by
39
higher electric base rates, effective in June 2010 and July
2011 ($172 million), offset by increased net base fuel
expense ($31 million), which was a result of higher net base
fuel cost rates approved in the 2010 and 2011 MoPSC rate
orders and due to higher fuel and transportation costs. Net
base fuel expense is the sum of fuel and transportation
costs included in base rates (-$84 million) and off-system
revenues (+$53 million) in the above table.
The following items had an unfavorable impact on
Ameren Missouri’s electric margins in 2011 compared with
2010:
‰
‰
‰
‰
Lower wholesale sales due to a reduction in customers,
the expiration of favorably priced contracts, and the
inclusion of revenues from the remaining contracts as
an offset to fuel costs in the FAC beginning July 31,
2011, which decreased revenues by $43 million.
Excluding the estimated impact of abnormal weather,
rate-regulated retail sales volumes declined by 1%,
attributable to continued economic pressure, energy
efficiency measures, and customer conservation
efforts, which decreased revenues by $37 million.
Summer weather conditions in 2011 were not as hot as
a very hot 2010, as evidenced by a 3% decrease in
cooling degree-days, which decreased revenues by
$29 million. However, weather conditions in Ameren
Missouri’s service territory in 2011 were still warmer
than normal as evidenced by 20% more cooling
degree-days.
A $17 million reduction in revenues, recorded in the
second quarter of 2011, resulting from the MoPSC’s
order with respect to its FAC disallowance for the
period from March 1, 2009 to September 30, 2009. See
Note 2 - Rate and Regulatory Matters under Part II,
Item 8, for further information regarding the FAC
prudence review.
Ameren Missouri’s natural gas margins increased by
$4 million, or 5%, in 2011 compared with 2010. Ameren
Missouri’s natural gas margins were favorably affected by
higher natural gas rates, effective February 2011, which
increased margins by $5 million.
Ameren Illinois Regulated Segment
Ameren Illinois has a cost recovery mechanism for
power purchased on behalf of its customers. These pass-
through power costs do not affect margins; however, the
electric revenues and offsetting purchased power costs may
fluctuate, primarily because of customer switching to
alternative power providers and usage. Ameren Illinois does
not generate earnings based on the resale of power, but
rather on the delivery of energy.
Ameren Illinois’ electric margins decreased by
$9 million, or 1%, in 2011 compared with 2010. The
following items had an unfavorable impact on electric
margins:
‰
Decreased recovery of prior years’ bad debt expense
under the Illinois bad debt rider, which became
effective in March 2010, which decreased margins by
‰
‰
$17 million. See Operations and Maintenance in this
section for additional information on a related offsetting
decrease in bad debt expense.
Continued economic pressure, energy efficiency
measures, and customer conservation efforts, which
decreased revenues by $15 million.
Summer weather conditions in 2011 were not as hot as
a very hot 2010, as evidenced by a 5% decrease in
cooling degree-days, which decreased revenues by
$7 million. However, weather conditions in Ameren
Illinois’ service territory in 2011 were still warmer than
normal as evidenced by 18% more cooling degree-
days.
The following items had a favorable impact on Ameren
Illinois’ electric margins in 2011 compared with 2010:
‰
Higher electric delivery service rates, effective in early
May and November 2010, increased margins by
$20 million and higher wholesale revenues due to an
increase in electric delivery service rates effective April
2011, which increased margins by $9 million. See Note
2 – Rate and Regulatory Matters under Part II, Item 8,
for further information regarding the 2011 wholesale
distribution rate case.
Increased recovery of energy efficiency program costs
and environmental remediation costs through Illinois
rate-adjustment mechanisms, which increased margins
by $6 million. See Operations and Maintenance in this
section for information on a related offsetting increase in
energy efficiency and environmental remediation costs.
Ameren Illinois’ natural gas margins decreased by
$21 million, or 6%, in 2011 compared with 2010. The
following items had an unfavorable impact on Ameren
Illinois’ natural gas margins:
‰
Decreased recovery of prior years’ bad debt expense
under the Illinois bad debt rider, which became
effective March 2010, which decreased margins by
$14 million. See Other Operations and Maintenance
Expenses in this section for additional information on a
related offsetting decrease in bad debt expense.
Unfavorable winter weather conditions, as evidenced by
a 5% decrease in heating degree-days, decreased
revenues by $5 million. However, compared to normal,
Ameren Illinois experienced in 2011 a 2% decrease in
heating degree-days.
Native load sales volumes declined by 4%, excluding
the estimated impact of abnormal weather, largely in
the commercial and industrial sectors, attributable to
continued economic pressure, which decreased
revenues by $4 million.
‰
‰
‰
Ameren Illinois’ gas margins were favorably affected
by $3 million due to higher natural gas rates effective in
May and November 2010.
Merchant Generation
Merchant Generation’s electric margins decreased by
$112 million, or 14%, in 2011 compared with 2010. See
below for explanations of electric margin variances for the
Merchant Generation segment.
40
Genco
Genco’s electric margins decreased by $73 million, or
13%, in 2011 compared with 2010. The following items had
an unfavorable impact on electric margins:
‰
Lower revenues allocated to Genco under its power
supply agreement (Genco PSA) with Marketing
Company. There was a smaller pool of money to
allocate because of reductions in higher-margin sales,
after the expiration of long-term contracts and because
of lower market prices. However, in accordance with
the Genco PSA, Genco was allocated a higher
percentage of revenues from the pool because of
higher reimbursable expenses and greater levels of
generation relative to AERG. Genco also experienced
lower market prices associated with EEI’s power supply
agreement with Marketing Company (EEI PSA). The
combined impact of lower market prices under both
power supply agreements resulted in an unfavorable
price variance, which reduced revenues by $58 million.
The decrease in revenues was mitigated by a favorable
settlement of a contract dispute with a large customer
in the second quarter of 2011.
5% higher fuel prices, primarily due to higher
commodity and transportation costs associated with
escalations in existing transportation agreements and
new commodity supply agreements, which decreased
margins by $11 million.
Net unrealized MTM activity on fuel-related
transactions, primarily associated with financial
instruments that were acquired to mitigate the risk of
rising diesel fuel price adjustments embedded in coal
transportation contracts, and on nonqualifying power
hedges, which decreased margins by $10 million.
‰
‰
Genco’s energy center utilization in 2011 was
comparable with 2010. Genco’s production volume increased
electric revenues by $2 million, which was offset by a
$2 million increase in Merchant Generation production
volume and other costs. Genco’s average capacity factor
remained unchanged at 71% in 2011 and 2010, but Genco’s
equivalent availability factor decreased to 86% in 2011,
compared with 88% in 2010.
Other Merchant Generation
Electric margins from Ameren’s other Merchant
Generation operations, primarily AERG and Marketing
Company, decreased by $39 million, or 16%, in 2011
compared with 2010. The following items had an
unfavorable impact on electric margins:
‰
Decreased energy center utilization at AERG, primarily
due to planned and unplanned outages and lower market
prices resulting in fewer opportunities for economic
power sales. AERG’s lower production volume decreased
electric revenues by $25 million, mitigated by a
$14 million decline in Merchant Generation production
volume and other costs. AERG’s average capacity factor
decreased to 73% in 2011, compared with 75% in 2010,
and AERG’s equivalent availability factor decreased to
81% in 2011, compared with 85% in 2010.
‰
‰
‰
41
‰
‰
‰
Unfavorable net unrealized MTM activity, principally at
Marketing Company, largely related to nonqualifying
power hedges, which decreased margins by
$15 million.
6% higher fuel prices at AERG, primarily due to higher
commodity and transportation costs associated with
escalations in existing transportation agreements and
new commodity supply agreements, decreased
margins by $6 million.
Lower revenues allocated to AERG under its power
supply agreement (AERG PSA) with Marketing
Company. There was a smaller pool of money to
allocate because of reductions in higher-margin sales,
after the expiration of long-term contracts and because
of lower market prices. In accordance with the AERG
PSA, AERG was also allocated a lower percentage of
revenues from the pool because of lower reimbursable
expenses and lower levels of generation relative to
Genco. The lower market prices resulted in an
unfavorable price variance, which decreased revenues
by $3 million. The decrease in revenues was mitigated
by a favorable settlement of a contract dispute with a
large customer in the second quarter of 2011.
2010 versus 2009
Ameren
Ameren’s electric margins increased by $202 million,
or 5%, in 2010 compared with 2009. The following items
had a favorable impact on Ameren’s electric margins:
‰
Favorable weather conditions, as evidenced by a 52%
increase in cooling degree-days, which increased
revenues by $174 million. Weather conditions in
Ameren’s service territory were warmer than normal, as
evidenced by 35% more cooling degree-days.
Higher electric base rates at Ameren Missouri, effective
March 2009 and June 2010, which increased revenues
by $162 million, offset by net base fuel expense
($93 million), which was a result of higher net base fuel
cost rates approved in the 2010 MoPSC rate order and
due to higher fuel and transportation costs and reduced
off-system revenues. Net base fuel expense is the sum
of fuel and transportation costs included in base rates
(+$9 million) and off-system revenues (-$102 million)
in the above table. See below for additional details
regarding the FAC.
Increased Ameren Missouri sales to Noranda in 2010,
as its smelter plant gradually returned to full capacity in
March 2010, after a severe January 2009 storm
significantly reduced the plant’s capacity, which
increased revenues by $54 million.
Higher transmission revenues primarily associated with
higher FERC-regulated transmission rates at Ameren
Illinois, which increased margins by $49 million. Higher
rates were due, in part, to a significant increase in
transmission assets placed into service at Ameren
Illinois during 2009, higher equity levels as a result of
Ameren’s capital contributions to Ameren Illinois in
2009 to improve its credit profile, and mild 2009
weather.
‰
‰
‰
‰
‰
‰
Higher electric delivery service rates at Ameren Illinois,
effective in early May and November 2010, as well as
the adjustment of residential electric delivery rates
effective in October 2009, to recover the full increase of
IP’s 2008 ICC rate order, which increased margins by
$41 million.
Net unrealized MTM activity principally at the Merchant
Generation segment (primarily at Marketing Company),
related to nonqualifying power hedges, which increased
margins by $49 million.
Increased recovery of energy efficiency program costs
and environmental remediation costs through Illinois
rate-adjustment mechanisms at Ameren Illinois, which
increased margins by $29 million. See Operations and
Maintenance in this section for information on a related
offsetting increase in energy efficiency program costs
and environmental remediation costs.
Excluding the impact of Ameren Missouri’s increased
sales to Noranda and the estimated impact of abnormal
weather, rate-regulated retail sales volumes increased
by 3%, largely because of improved economic
conditions, which increased revenues by $25 million.
A reduction in the impact of the 2007 Illinois Electric
Settlement Agreement, which increased margins by
$23 million.
Increased recovery of prior years’ bad debt expense
through the Illinois bad debt rider at Ameren Illinois,
which became effective March 2010, which increased
margins by $14 million. See Operations and
Maintenance in this section for additional information
on a related offsetting increase in bad debt expense.
The following items had an unfavorable impact on
Ameren’s electric margins for 2010 compared with 2009:
‰
Reductions in higher-margin sales at the Merchant
Generation segment after the expiration of the 2006
auction power supply agreements on May 31, 2010,
and lower market prices that resulted in fewer
opportunities for economic power sales, which
decreased margins by $243 million.
14% higher fuel prices in the Merchant Generation
segment, primarily due to higher commodity and
transportation costs associated with new supply
contracts, which decreased margins by $71 million.
In the first quarter of 2009, the reversal of previously
unrealized losses related to regulatory assets resulted
in the recognition of a $29 million net MTM gain on
energy and fuel-related contracts at Ameren Missouri.
After the implementation of Ameren Missouri’s FAC in
March 2009, Ameren Missouri’s net MTM gains or
losses no longer affect electric margins. Net unrealized
MTM activity at the Merchant Generation segment on
fuel-related transactions, primarily associated with
financial instruments acquired to mitigate the risk of
rising diesel fuel price adjustments embedded in coal
transportation contracts, reduced margins by
$20 million.
‰
‰
Ameren’s Illinois pass-through power supply costs
reflect lower power prices and the expiration of
intercompany power supply agreements between Ameren
42
Illinois and Marketing Company. Ameren Illinois purchased
power from Marketing Company from January 1, 2007,
through May 31, 2010, under power supply agreements
entered into following a 2006 Illinois power procurement
auction. The purchases and sales under these agreements
were eliminated in consolidation for Ameren’s financial
statements. Subsequent to the expiration of these
agreements in May 2010, Marketing Company’s power
sales and Ameren Illinois’ power purchases have been
made primarily with nonaffiliated parties. As a result,
Ameren’s consolidated revenues increased by a net
$220 million in 2010 compared with 2009. These revenues
were offset by a corresponding $220 million net increase in
purchased power costs.
Ameren Missouri has a FAC cost recovery mechanism
that allows Ameren Missouri to recover, through customer
rates, 95% of changes in fuel and purchased power costs,
net of off-system revenues, including MISO costs and
revenues, greater or less than the amount set in base rates,
without a traditional rate proceeding. Ameren Missouri
accrued, as a regulatory asset, fuel and purchased power
costs that were greater than the amount set in base rates
(FAC under-recovery). Net recovery of fuel costs under the
FAC through customer rates increased by $60 million in
2010, as compared with 2009, with corresponding offsets to
fuel expense to reduce the previously recognized FAC
regulatory asset. See below for explanations of electric and
natural gas margin variances for the Ameren Missouri
segment.
Ameren’s natural gas margins increased by $2 million,
or less than 1%, in 2010 compared with 2009. The
following items had a favorable impact on Ameren’s natural
gas margins:
‰
‰
Increased recovery of prior years’ bad debt expense
through the Illinois bad debt rider at Ameren Illinois,
effective March 2010, which increased margins by
$15 million. See Operations and Maintenance in this
section for additional information on a related offsetting
increase in bad debt expense.
Favorable higher-margin customer mix that was
mitigated by a 2% decrease in sales volumes, which
increased margins by $2 million.
The following items had an unfavorable impact on
Ameren’s natural gas margins in 2010 compared with 2009:
‰
‰
Lower natural gas rates effective early May 2010 at
Ameren Illinois, which reduced margins by $11 million.
The absence of net unrealized MTM gains in 2010 of
$6 million on natural gas swaps.
Ameren Missouri
Ameren Missouri has a FAC cost recovery mechanism
as discussed in the Ameren margin discussion above.
Ameren Missouri’s electric margins increased by
$250 million, or 13%, in 2010 compared with 2009. The
following items had a favorable impact on Ameren
Missouri’s electric margins:
‰
Higher electric base rates, effective March 2009 and
June 2010, which increased revenues by $162 million,
offset by net base fuel expense ($93 million), which
was a result of higher net base fuel cost rates approved
in the 2010 MoPSC rate order and due to higher fuel
and transportation costs and reduced off-system
revenues. Net base fuel expense is the sum of fuel and
transportation costs included in base rates
(+$9 million) and off-system revenues (-$102 million)
in the above table.
Favorable weather conditions, as evidenced by a 44%
increase in cooling degree-days, which increased
revenues by $134 million. Weather conditions in
Ameren Missouri’s service territory were warmer than
normal as evidenced by 45% more cooling degree-
days.
Increased sales to Noranda in 2010 as its smelter plant
gradually returned to full capacity in March 2010, after
a severe January 2009 storm significantly reduced the
plant’s capacity, which increased electric revenues by
$54 million.
Taum Sauk energy center’s return to service. Although
Taum Sauk was not available to generate electricity for
off-system revenues during 2009, Ameren Missouri
had included $19 million in the calculation of the FAC
as if Taum Sauk had generated off-system revenues.
Upon Taum Sauk’s return to service in April 2010,
Ameren Missouri’s margins increased. The adjustment
factor was eliminated from the FAC calculation, which
increased margins by $12 million.
Excluding the impact of increased sales to Noranda and
the estimated impact of abnormal weather, rate-
regulated retail sales volumes increased by less than
1%, largely because of improved economic conditions,
which increased revenues by $9 million.
‰
‰
‰
‰
Ameren Missouri’s electric margin was unfavorably
affected by the reversal of previously unrealized losses to
regulatory assets, which resulted in the recognition of a
$29 million net MTM gain on energy and fuel-related
contracts in the first quarter of 2009. This benefit did not
recur in 2010. After the implementation of the FAC in March
2009, net MTM gains or losses no longer affect electric
margins.
Ameren Missouri’s natural gas margins increased by
$2 million, or 3%, in 2010 compared with 2009 because of
a 2% increase in sales volumes, largely due to improved
economic conditions.
Ameren Illinois Regulated Segment
Ameren Illinois has a cost recovery mechanism for
power purchased on behalf of its customers. These pass-
through power costs do not affect margins; however, the
electric revenues and offsetting purchased power costs may
fluctuate, primarily because of customer switching to
alternative providers and usage.
43
Ameren Illinois’ electric margins increased by
$179 million, or 20%, in 2010 compared with 2009. The
following items had a favorable impact on electric margins:
‰
‰
‰
‰
‰
‰
Higher transmission revenues primarily associated with
higher FERC-regulated transmission rates, which
increased revenues by $42 million. Higher rates were
due, in part, to an increase in transmission assets
placed into service during 2009, higher equity levels
resulting from Ameren’s capital contributions to IP in
2009, and mild 2009 weather.
Higher electric delivery service rates, effective in early
May and November 2010, as well as the adjustment of
residential electric delivery rates effective October 1,
2009, at IP to recover the full increase of the 2008 ICC
rate order, which increased margins by $41 million.
Favorable weather conditions, as evidenced by a 65%
increase in cooling degree-days, which increased
revenues by $40 million. Weather conditions in Ameren
Illinois’ service territory were warmer than normal, as
evidenced by 23% more cooling degree-days.
Increased recovery of energy efficiency program costs
and environmental remediation costs through Illinois
rate-adjustment mechanisms, which increased margins
by $29 million. See Operations and Maintenance in this
section for information on a related offsetting increase
in energy efficiency program costs and environmental
remediation costs.
Increased recovery of prior years’ bad debt expense
under the Illinois bad debt rider, effective March 2010,
which increased margins by $14 million. See
Operations and Maintenance in this section for
additional information on a related offsetting increase in
bad debt expense.
A reduction in the impact of the 2007 Illinois Electric
Settlement Agreement, which increased margins by
$10 million.
Ameren Illinois’ natural gas margins increased by
$2 million, or 1%, in 2010 compared with 2009. The
following items had a favorable impact on natural gas
margins:
‰
‰
Increased recovery of prior years’ bad debt expense
under the Illinois bad debt rider, effective March 2010,
which increased margins by $15 million. See
Operations and Maintenance in this section for
additional information on a related offsetting increase in
bad debt expense.
A higher-margin customer mix that was mitigated by a
3% decrease in sales volumes, which increased
margins by $2 million.
The following items had an unfavorable impact on
Ameren Illinois’ natural gas margins in 2010 compared with
2009:
‰
‰
Lower natural gas rates effective early May 2010, which
reduced margins by $11 million.
The absence of net unrealized MTM gains in 2010 of
$6 million on natural gas swaps, as occurred in 2009.
Merchant Generation
Merchant Generation’s electric margins decreased by
$232 million, or 23%, in 2010 compared with 2009. See
below for explanations of electric margin variances for the
Merchant Generation segment.
Genco
Genco’s electric margins decreased by $118 million, or
18%, in 2010 compared with 2009. The following items had
an unfavorable impact on electric margins:
‰
Lower revenues allocated to Genco under its power
supply agreement (Genco PSA) with Marketing
Company. There was a smaller pool of money to
allocate because of reductions in higher-margin sales,
after the expiration of older long-term contracts and
because of lower market prices. The lower market
prices associated with the Genco PSA were mitigated
by higher market prices associated with EEI’s power
supply agreement with Marketing Company (EEI PSA).
The net impact of lower market prices under both
power supply agreements reduced electric revenues by
$81 million. In accordance with the Genco PSA, Genco
was also allocated a lower percentage of revenues from
the pool because of lower reimbursable expenses and
lower generation relative to AERG.
14% higher fuel prices, primarily due to higher
commodity and transportation costs associated with
new supply contracts, which decreased margins by
$51 million.
Net unrealized MTM activity on fuel-related transactions
primarily associated with financial instruments that
were acquired to mitigate the risk of rising diesel fuel
price adjustments embedded in coal transportation
contracts, which reduced margins by $19 million.
The following items had a favorable impact on Genco’s
electric margins in 2010 compared with 2009:
‰
A reduction in the impact of the 2007 Illinois Electric
Settlement Agreement, which increased margins by
$10 million.
Increased energy center utilization, primarily due to more
economic sales opportunities and a reduction in
transmission constraints, which previously limited the
period in which power could be sold. In addition, one of
Genco’s coal-fired energy centers experienced a
transformer fire in September 2009, which put two units
out of service for a time in 2009. The higher production
volume contributed to the $50 million increase in electric
revenues, which was mitigated by higher Merchant
Generation production volume and other costs of
$38 million. Genco’s baseload coal-fired energy centers’
average capacity factor increased to 71% in 2010,
compared with 67% in 2009, and Genco’s equivalent
availability factor increased to 88% in 2010, compared
with 82% in 2009.
‰
‰
‰
Other Merchant Generation
Electric margins from Ameren’s other Merchant
Generation operations, primarily AERG and Marketing
Company, decreased by $114 million, or 32%, in 2010
compared with 2009. The following items had an
unfavorable impact on electric margins:
‰
Lower revenues allocated to AERG under its power
supply agreement (AERG PSA) with Marketing
Company. There was a smaller pool of money to
allocate because of reductions in higher-margin sales
after the expiration of older long-term contracts and
because of lower market prices. These items reduced
electric margins by $162 million. However, in
accordance with the AERG PSA, AERG was allocated a
greater percentage of revenues from the pool because
of higher reimbursable expenses and higher generation
relative to Genco.
19% higher fuel prices at AERG primarily due to higher
commodity and transportation costs associated with
new supply contracts, which decreased margins
$20 million.
The following items had a favorable impact on the
electric margins of other Merchant Generation operations in
2010 compared with 2009:
‰
Net unrealized MTM activity at Marketing Company
improved margins by $46 million, largely related to
nonqualifying power hedges.
A reduction in the impact of the 2007 Illinois Electric
Settlement Agreement at AERG, which increased
margins by $4 million.
Increased energy center utilization at AERG, primarily
due to more opportunities for economic sales and a
reduction in energy center outages. The higher
production volume increased electric revenues by
$37 million, which was partially offset by higher
Merchant Generation production volume and other
costs of $9 million. AERG’s baseload coal-fired energy
centers’ average capacity factor increased to 75% in
2010, compared with 69% in 2009, while AERG’s
equivalent availability factor increased to 85% in 2010,
compared with 78% in 2009.
‰
‰
‰
Other Operations and Maintenance Expenses
2011 versus 2010
Ameren Corporation
Other operations and maintenance expenses were
comparable between 2011 and 2010.
The following items reduced other operations and
maintenance expenses between years:
‰
Charges in 2010 of $22 million due to cancelled or
unrecoverable projects at Ameren Missouri that did not
recur in 2011.
A decrease of $20 million in plant maintenance costs,
primarily because the scope of the outages in 2011
were not as extensive as the scope of the outages
performed in 2010. Costs associated with the 2011
refueling and maintenance outage at Ameren Missouri’s
Callaway energy center were consistent with costs
incurred for the 2010 refueling and maintenance
outage.
‰
44
‰
‰
‰
A $17 million decrease in bad debt expense. Bad debt
expense decreased primarily because of adjustments
under the Ameren Illinois bad debt rider mechanism.
Expense recorded under the Ameren Illinois bad debt
rider mechanism is recovered through customer
billings, with no overall effect on net income.
A $5 million decrease in employee benefit costs,
primarily because of adjustments under Ameren
Missouri’s pension and postretirement benefit cost
tracker.
Disciplined cost management efforts to align spending
with regulatory outcomes and economic conditions.
The following items increased other operations and
maintenance expenses between years:
‰
‰
‰
‰
‰
A $34 million increase in storm-related repair costs,
due to major storms in 2011.
Recognition of $28 million of employee severance
costs related to the voluntary separation offers to
eligible Ameren Missouri and Ameren Services
employees in 2011, $27 million of which Ameren
Missouri will seek to recover in its pending electric rate
case.
A reduction in other operations and maintenance
expenses in 2010 by $11 million for a May 2010
MoPSC rate order, which resulted in the recording of
regulatory assets related to 2009 employee severance
costs and storm costs.
An unfavorable change of $9 million in unrealized net
MTM adjustments between years, resulting from
changes in the market value of investments used to
support Ameren’s deferred compensation plans.
A $5 million increase in Ameren Illinois’ energy
efficiency and environmental remediation costs, which
are recovered through customer billings and offset by
increased revenues, with no overall impact on net
income.
Variations in other operations and maintenance
expenses in Ameren’s business segments and for the
Ameren Companies between 2011 and 2010 were as
follows:
‰
Ameren Missouri
‰
‰
‰
‰
‰
‰
‰
The following items reduced other operations and
maintenance expenses between years:
‰
Plant maintenance costs decreased by $23 million,
primarily because the scope of the outages in 2011
were not as extensive as the scope of the outages
performed in 2010.
Charges in 2010 of $22 million because of cancelled or
unrecoverable projects.
A $9 million decrease in employee benefit costs,
primarily because of adjustments under the pension
and postretirement benefit cost tracker.
Disciplined cost management efforts to align spending
with regulatory outcomes and economic conditions.
Ameren Illinois Regulated Segment
Other operations and maintenance expenses were
comparable in 2011 with 2010.
The following items increased other operations and
maintenance expenses between years:
‰
A $13 million increase in storm-related repair costs,
due to major storms in 2011.
Energy efficiency and environmental remediation costs
increased by $5 million, as discussed above.
Injuries and damages expenses were higher by
$4 million because of increased claims.
Expenses of $3 million associated with the electric rate
case in 2011 were written-off because the rate case
was withdrawn after passage of the IEIMA.
A reduction in other operations and maintenance
expenses in 2010 by $3 million for a May 2010 ICC rate
order, which resulted in the recording of a regulatory
asset related to 2009 employee severance costs.
The following items reduced other operations and
maintenance expenses between years:
‰
A $19 million reduction in bad debt expense.
Adjustments of $31 million under the bad debt rider
mechanism were partially offset by higher uncollectible
expense.
A reduction of $5 million in non-storm-related
distribution maintenance expenditures due, in part, to
cost management efforts.
Other operations and maintenance expenses were
Merchant Generation and Genco
comparable between years.
The following items increased other operations and
maintenance expenses between years:
‰
‰
‰
‰
Recognition of $27 million of employee severance
costs because of a voluntary separation plan in 2011.
A $21 million increase in storm-related repair costs,
due to major storms in 2011.
A reduction in other operations and maintenance
expenses in 2010 by $11 million for the May 2010
MoPSC rate order discussed above.
An unfavorable change of $5 million in unrealized net
MTM adjustments between years, resulting from
changes in the market value of investments used to
support Ameren’s deferred compensation plans.
Other operations and maintenance expenses were
comparable between years in the Merchant Generation
segment as increased employee benefit costs, primarily
pension costs, as well as higher plant maintenance costs
resulting from increased planned outages at AERG, mitigated
the favorable impact of property sale gains at Genco.
Other operations and maintenance expenses decreased
by $12 million in 2011 at Genco, primarily because of a
$7 million increase in gains on property sales.
2010 versus 2009
Ameren Corporation
Other operations and maintenance expenses increased
by $53 million in 2010 compared with 2009.
45
The following items increased other operations and
maintenance expenses between years:
‰
‰
‰
‰
Increased plant maintenance and labor costs of
$39 million associated with a refueling and
maintenance outage at the Callaway energy center and
an increase of $16 million for other scheduled coal-
fired plant outages, the installation of scrubbers at
Ameren Missouri’s Sioux energy center, and other
maintenance work. There was no Callaway energy
center refueling and maintenance outage in 2009.
A $46 million increase in bad debt expense. The July
2009 capitalization and recovery of prior years’ bad
debt expense under the Ameren Illinois bad debt rate
adjustment mechanism (net of a related donation for
customer assistance programs) reduced bad debt
expense in 2009. Additionally, bad debt expense
increased in 2010, because of amortization of
regulatory assets set up in conjunction with the Ameren
Illinois bad debt rate adjustment mechanism in 2009.
Amortization expense associated with these regulatory
assets was offset by increased revenues through
collection from customers, with no overall impact on
net income.
Increased Ameren Illinois energy efficiency program
costs and environmental remediation costs of
$30 million. Energy efficiency program costs are
allowed to be recovered from customers under the
2007 Illinois Electric Settlement Agreement;
environmental remediation costs associated with MGPs
are recoverable from customers through Ameren
Illinois environmental adjustment rate riders.
Accordingly, these costs are offset by increased
revenues, with no overall impact on net income. See
Note 2 – Rate and Regulatory Matters and Note 15 –
Commitments and Contingencies under Part II, Item 8,
of this report for additional information.
An unfavorable change of $7 million in unrealized net
MTM adjustments between years, resulting from
changes in the market value of investments used to
support Ameren’s deferred compensation plans.
The following items reduced other operations and
maintenance expenses between years:
‰
‰
‰
‰
‰
The absence in 2010 of major storms, such as those in
2009, which resulted in a $27 million reduction in other
operations and maintenance expenses.
Severance costs of $17 million for employee separation
programs recognized in 2009, as compared with
$4 million in 2010.
A May 2010 MoPSC electric rate order, which resulted
in Ameren Missouri recording regulatory assets in 2010
related to employee severance costs, and storm costs
incurred in 2009, which decreased expenses by
$11 million.
A reduction in labor costs of $10 million, primarily
because of staff reductions.
Items that unfavorably affected Ameren in 2009 that did
not recur in 2010: a $5 million penalty incurred for the
termination of a heavy forgings contract associated
with efforts to build a new nuclear unit at Ameren
Missouri’s Callaway energy center and a $5 million
write-off of Ameren’s investment in a supply acquisition
partnership.
A gain on the sale of property interests at Genco
recognized in 2010.
‰
Variations in other operations and maintenance
expenses in Ameren’s business segments and for the
Ameren Companies between 2010 and 2009 were as
follows:
Ameren Missouri
Other operations and maintenance expenses increased
by $51 million in 2010.
The following items increased other operations and
maintenance expenses between years:
‰
‰
‰
Plant maintenance and labor costs increased by
$39 million as a result of the Callaway energy center
refueling and maintenance outage and by $34 million
for other scheduled coal-fired plant outages, the
installation of scrubbers at the Sioux energy center, and
other maintenance work and plant-related costs.
An unfavorable change of $4 million in unrealized net
MTM adjustments between years resulting from
changes in the market value of investments used to
support Ameren’s deferred compensation.
Higher bad debt expense of $5 million, primarily due to
higher customer billings resulting from rate increases
and weather conditions.
The following items reduced other operations and
maintenance expenses between years:
‰
‰
‰
The absence of major storms, such as those in 2009,
which resulted in a decrease in other operations and
maintenance expenses of $13 million.
The recording of regulatory assets in 2010 related to
employee severance costs and storm costs incurred in
2009, as discussed above.
The absence of severance costs for employee
separation programs and the absence of the forgings
contract penalty recognized in 2009, as discussed
above.
Ameren Illinois Regulated Segment
Other operations and maintenance expenses increased
by $45 million in 2010.
The following items increased other operations and
maintenance expenses between years:
‰
A $40 million increase in bad debt expense resulting
from the July 2009 capitalization and recovery of prior
years’ bad debt expense under the Ameren Illinois bad
debt rate adjustment mechanism (net of a related
donation for customer assistance programs), which
decreased bad debt expense in 2009, and the
amortization in 2010 of regulatory assets set up in
46
conjunction with the Ameren Illinois bad debt rate
adjustment mechanism in 2009.
Energy efficiency and environmental remediation costs
increased by $30 million, as discussed above.
‰
The following items reduced other operations and
maintenance expenses between years:
‰
‰
The absence of major storms in 2010, as compared
with storm costs of $16 million in 2009.
A reduction of $9 million in employee benefit costs due,
in part, to the absence of severance costs in 2010 such
as those incurred in 2009.
Merchant Generation
Other operations and maintenance expenses decreased
by $46 million in 2010 in the Merchant Generation segment,
primarily because of variations at Genco, as discussed
below. Additionally, other operations and maintenance
expenses decreased at AERG, primarily because of lower
labor costs due to staff reductions, and reduced severance
costs due to employee separation programs that were
implemented in 2009.
Genco
Other operations and maintenance expenses decreased
by $35 million in 2010. Plant maintenance costs were lower
by $16 million due to the retirement in 2009 of two
generation units at Genco’s Meredosia energy center and
other reductions in required maintenance work.
Additionally, other operations and maintenance costs were
lower due to a $7 million reduction in employee benefit
costs, due, in part, to reduced severance costs because of
employee separation programs in 2009, a $5 million decline
in labor costs resulting from staff reductions, and a
property sale gain in 2010.
Goodwill, Impairment and Other Charges
The following table summarizes goodwill, impairment
and other charges for the years ended December 31, 2011,
2010, and 2009:
Long-lived
Assets and
Related
Charges
Emission
Allowances
Goodwill
Total
2011:
AMO . . . . . . . . .
Genco . . . . . . . .
AERG . . . . . . . .
$
89
34
-
Ameren . . . . . . .
$
123
2010:
Genco . . . . . . . .
AERG . . . . . . . .
Ameren . . . . . . .
2009:
Genco . . . . . . . .
AERG . . . . . . . .
Ameren . . . . . . .
$
$
$
$
64
37
101
6
1
7
$
$
$
$
$
$
-
1
1
2
41
27
68
-
-
-
$
$
$
$
$
$
-
-
-
-
$
89
35
1
$
125
65
355
420
-
-
-
$
$
$
$
170
419
589
6
1
7
See Note 1 – Summary of Significant Accounting
Policies, Note 2 – Rate and Regulatory Matters, Note 15 –
Commitment and Contingencies, and Note 17 – Goodwill,
Impairment and Other Charges under Part II, Item 8, of this
report for additional information.
Ameren Corporation
Goodwill, impairment and other charges decreased by
$464 million in 2011. Ameren Missouri and Genco recorded
long-lived asset impairments and related charges in 2011,
which are discussed individually below. Additionally,
Ameren and Genco recorded intangible asset impairment
charges in 2011 relating to emission allowances of
$2 million and $1 million, respectively. Larger impairments
were recorded in 2010, when Ameren recognized noncash,
pretax impairment charges relating to goodwill, long-lived
assets, and emission allowances within the Merchant
Generation segment. The impairments recorded in 2010 in
the Merchant Generation segment were caused by a
sustained decline in market prices for electricity, industry
market multiples becoming observable at lower levels than
previously estimated, and potentially more stringent
environmental regulations being enacted.
Ameren Missouri
In July 2011, the MoPSC issued an electric rate order
that disallowed the recovery of costs of enhancements
relating to the rebuilding of the Taum Sauk energy center in
excess of the amounts recovered from property insurance.
As a result, Ameren Missouri recorded a pretax charge to
earnings of $89 million in 2011. See Note 2 – Rate and
Regulatory Matters to our financial statements under Part II,
Item 8, of this report for additional information on the
disallowance, including Ameren Missouri’s appeal of the
MoPSC’s July 2011 electric rate order.
Merchant Generation and Genco
At the end of 2011, Genco ceased operations of its
Meredosia and Hutsonville energy centers. The closure of
these energy centers was primarily the result of the
expected cost of complying with the CSAPR and the MATS.
Genco determined that environmental compliance options
for these four units were uneconomical. Another factor
driving the closure of these energy centers was a lack of a
multiyear capacity market managed by MISO, without which
Genco was not positioned to make the substantial
investment for environmental controls that would be
required to keep these units in service. As a result of these
closures, Ameren and Genco each recorded a charge to
earnings in 2011 of $34 million. Larger impairments were
recorded in 2010, when Ameren and Genco recognized
noncash, pretax impairment charges relating to goodwill,
long-lived assets, and emission allowances.
In 2009, Genco recorded asset impairment charges of
$6 million as a result of the termination of a rail line
extension project at a subsidiary of Genco and to adjust the
carrying value of an office building owned by Genco to its
estimated fair value as of December 31, 2009. In addition,
AERG recorded an asset impairment charge of $1 million to
adjust the carrying value of its Indian Trails generation
facility’s estimated fair value as of December 31, 2009.
47
Depreciation and Amortization
Ameren Illinois Regulated Segment
2011 versus 2010
Ameren Corporation
Ameren’s depreciation and amortization expenses
increased by $20 million in 2011 compared with 2010,
because of items noted below. Partially mitigating these
increases was an $8 million reduction in depreciation and
amortization expenses at Ameren Services, primarily
because of computer equipment becoming fully-depreciated
during 2011.
Variations in depreciation and amortization expenses in
Ameren’s business segments and for the Ameren
Companies between 2011 and 2010 were as follows:
Ameren Missouri
Depreciation and amortization expenses increased by
$26 million in 2011, primarily because of increased
depreciation and amortization expense resulting from the
installation of scrubbers at the Sioux energy center and
other capital additions. Additionally, an increase in Ameren
Missouri’s annual depreciation rates as a result of the 2010
MoPSC electric rate order resulted in higher depreciation
and amortization expenses.
Ameren Illinois Regulated Segment
Depreciation and amortization expenses decreased by
$6 million in 2010, primarily because of a reduction in
amortization of regulatory assets. An ICC rate order in April
2010 extended the amortization period of the IP integration-
related regulatory asset. See Note 2 – Rate and Regulatory
Matters to our financial statements under Part lI, Item 8, of
this report for additional information.
Merchant Generation and Genco
Depreciation and amortization expenses increased by
$20 million in 2010 in the Merchant Generation segment,
primarily because depreciation and amortization expenses
increased by $17 million in 2010 at Genco, due to capital
additions and increased depreciation rates resulting from
depreciation studies performed in 2009.
Taxes Other Than Income Taxes
2011 versus 2010
Ameren Corporation
Taxes other than income taxes increased by $8 million
in 2011 compared with 2010, primarily because of items
noted below at Ameren Missouri.
Variations in taxes other than income taxes in
Ameren’s business segments and for the Ameren
Companies between 2011 and 2010 were as follows:
Depreciation and amortization expenses increased by
$5 million in 2011, primarily because of capital additions.
Ameren Missouri
Merchant Generation and Genco
Depreciation and amortization expenses were
comparable between years in the Merchant Generation
Segment and at Genco.
2010 versus 2009
Ameren Corporation
Ameren’s depreciation and amortization expenses
increased by $40 million in 2010 compared with 2009,
because of items noted below.
Variations in depreciation and amortization expenses in
Ameren’s business segments and for the Ameren
Companies between 2010 and 2009 were as follows:
Ameren Missouri
Depreciation and amortization expenses increased by
$25 million in 2010, primarily because of capital additions and
an increase in Ameren Missouri’s annual depreciation rates due
largely to the adoption of the life span depreciation
methodology as a result of the 2010 MoPSC electric rate order.
Taxes other than income taxes increased by
$11 million in 2011, primarily because of increased
property taxes, due to higher state and local assessments
and higher tax rates, and higher gross receipts taxes from
increased revenues.
Ameren Illinois Regulated Segment
Taxes other than income taxes were comparable
between years. Increased property taxes in 2011, primarily
due to higher tax rates, were mitigated by the absence of
franchise taxes that were incurred in 2010 in association
with the Ameren Illinois Merger.
Merchant Generation and Genco
Taxes other than income taxes were comparable
between years in the Merchant Generation Segment and at
Genco.
2010 versus 2009
Ameren Corporation
Taxes other than income taxes increased by
$29 million in 2010 compared with 2009, because of items
noted below.
48
Variations in taxes other than income taxes in
Ameren’s business segments and for the Ameren
Companies between 2010 and 2009 were as follows:
Ameren Missouri
Taxes other than income taxes increased by
$28 million in 2010, primarily because of higher gross
receipts taxes as a result of increased sales, and because of
increased property taxes due to higher assessed tax rates in
Missouri.
Ameren Missouri
Miscellaneous income, net of expenses, increased by
$14 million in 2010, primarily because of higher allowance
for equity funds used during construction associated with a
project to install scrubbers at Ameren Missouri’s Sioux
energy center, reduced, in part, by increased charitable
contributions.
Ameren Illinois Regulated Segment
Ameren Illinois Regulated Segment and Merchant
Generation
Taxes other than income taxes were comparable
between years in the Ameren Illinois Regulated Segment, in
the Merchant Generation segment, and at Genco.
Ameren Illinois had net miscellaneous expense of
$6 million in 2010, compared with net miscellaneous
income of $2 million in 2009. Interest income decreased by
$5 million in 2010 compared with 2009, because the CIPS
note receivable from Genco matured on May 1, 2010.
Other Income and Expenses
2011 versus 2010
Ameren Corporation
Miscellaneous income, net of expenses, decreased by
$11 million in 2011 compared with 2010, primarily because
of items noted below.
Variations in miscellaneous income, net of expenses,
in Ameren’s business segments and for the Ameren
Companies between 2011 and 2010 were as follows:
Ameren Missouri
Miscellaneous income, net of expenses, decreased by
$19 million in 2011, primarily because of reduced allowance
for equity funds used during construction. Allowance for
equity funds used during construction was higher in 2010,
primarily due to scrubbers being constructed at Ameren
Missouri’s Sioux energy center, which were placed in
service in late 2010.
Merchant Generation and Genco
Miscellaneous income, net of expenses, was
comparable between years in the Merchant Generation
Segment and at Genco.
Interest Charges
2011 versus 2010
Ameren Corporation
Interest charges decreased by $46 million in 2011
compared with 2010, because of items noted below and
because of reduced credit facility borrowings at Ameren.
Variations in interest charges in Ameren’s business
segments and for the Ameren Companies between 2011
and 2010 were as follows:
Ameren Illinois Regulated Segment
Ameren Missouri
Miscellaneous income, net of expenses, increased by
$7 million in 2011, primarily because of reduced expenses
associated with customer assistance programs.
Merchant Generation and Genco
Miscellaneous income, net of expenses, was
comparable between years in the Merchant Generation
Segment and at Genco.
2010 versus 2009
Ameren Corporation
Interest charges decreased by $4 million in 2011,
primarily because of a reduction in interest charges
associated with uncertain tax positions of $6 million, the
redemption of $66 million of subordinated deferrable
interest debentures in September 2010, and reduced
amortization of credit facility fees. Offsetting these favorable
items was a reduction in interest charges in 2010 due to the
May 2010 MoPSC electric rate order. The rate order
resulted in a reduction of interest charges of $10 million in
2010, through the recording of a regulatory asset for
recovery of bank credit facility fees incurred in 2009.
Miscellaneous income, net of expenses, increased by
$9 million in 2010 compared with 2009, because of items
noted below.
Variations in miscellaneous income, net of expenses,
in Ameren’s business segments and for the Ameren
Companies between 2010 and 2009 were as follows:
Ameren Illinois Regulated Segment
Interest charges decreased by $7 million in 2011,
primarily because of the redemption of $150 million of
senior secured notes in June 2011 and the redemption of
$40 million of first mortgage bonds in September 2010.
49
Merchant Generation
Interest charges decreased by $28 million in 2011 in
the Merchant Generation segment because of items
discussed below at Genco, and because of reduced
intercompany borrowings at AERG.
Genco
(a) The effective tax rate was 36% for 2010, after excluding the
impact of the goodwill impairment charge, which is not
deductible for income tax purposes.
(b) The effective tax rate was 40% for 2010, after excluding the
impact of the goodwill impairment charge, which is not
deductible for income tax purposes.
(c) The effective tax rate was 30% for 2010, after excluding the
impact of the goodwill impairment charge, which is not
deductible for income tax purposes.
Interest charges decreased by $15 million in 2011 at
Genco, primarily because of the maturity and repayment of
$200 million of senior unsecured notes in November 2010.
2011 versus 2010
Ameren Corporation
Ameren’s effective tax rate was lower in 2011 than in
2010, primarily due to the impact of the nondeductible
goodwill impairment charge in 2010. See Note 17 – Goodwill,
Impairment and Other Charges under Part II, Item 8, of this
report for additional information on the goodwill impairment
charges. In addition, there was a noncash, after-tax charge to
earnings of $13 million, in the first quarter of 2010, to reduce
deferred tax assets. The charge to earnings was recorded
because of legislation enacted in the first quarter of 2010 that
resulted in retiree health care costs no longer being
deductible for tax purposes to the extent an employer’s
postretirement health care plan receives federal subsidies that
provide retiree prescription drug benefits equivalent to
Medicare prescription drug benefits. This was offset, in part,
by the impact of the increased Illinois statutory tax rate
effective at the beginning of 2011, along with lower favorable
net amortization of property-related regulatory assets and
liabilities in 2011 compared with 2010, changes to reserves
for uncertain tax positions, and the decreased impact of
federal and state tax credits.
Variations in effective tax rates in Ameren’s business
segments and for the Ameren Companies between 2011
and 2010 were as follows:
Ameren Missouri
Ameren Missouri’s effective tax rate was higher,
primarily because of lower favorable net amortization of
property-related regulatory assets and liabilities in 2011
compared to 2010, offset, in part, by the effect of the
change in the tax treatment of retiree health care costs in
2010 and changes to reserves for uncertain tax positions.
Ameren Illinois Regulated Segment
Ameren Illinois Regulated Segment’s effective tax rate
was comparable between years.
Merchant Generation
The effective tax rate was higher in the Merchant
Generation segment, primarily because of items detailed
below at Genco.
2010 versus 2009
Ameren Corporation
Interest charges decreased by $11 million in 2010
compared with 2009, because of items noted below. The
decreases below were mitigated by additional interest
charges resulting from the issuance of $425 million of
senior notes by Ameren in May 2009.
Variations in interest charges in Ameren’s business
segments and for the Ameren Companies between 2010
and 2009 were as follows:
Ameren Missouri
Interest charges decreased by $16 million in 2010.
Interest charges were reduced by $10 million because of a
May 2010 MoPSC electric rate order, as discussed above.
Additionally, interest charges were reduced by an increase
in allowance for borrowed funds used during construction
associated with a project to install scrubbers at the Sioux
energy center. Partially reducing the above benefits was an
increase in interest charges associated with the issuance of
$350 million of senior secured notes in March 2009.
Ameren Illinois Regulated Segment
Interest charges decreased by $10 million in 2010,
primarily because of the maturity of $250 million of first
mortgage bonds in June 2009.
Merchant Generation and Genco
Interest charges increased by $14 million in 2010 in
the Merchant Generation segment and $17 million at
Genco, primarily because of the issuance of $250 million of
senior unsecured notes at Genco in November 2009.
Income Taxes
The following table presents effective income tax rates
for the registrants and by segment for the years ended
December 31, 2011, 2010, and 2009:
2011
2010
2009
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri . . . . . . . . . . . . . . . . . . .
. . . .
Ameren Illinois Regulated Segment
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . .
Merchant Generation . . . . . . . . . . . . . . . .
37%
36
39
42
41
68%(a)
35
39
(b)
(c)
35%
33
37
38
38
50
Genco
Income from Discontinued Operations, Net of Tax
Genco’s effective tax rate was higher, after excluding the
Ameren Illinois
impact of the nondeductible goodwill impairment charge,
primarily due to the increase in the Illinois statutory income
tax rate in 2011, decreased Internal Revenue Code
Section 199 production activity deductions and lower benefits
from state tax credits related to capital investments, offset by
favorable changes to reserves for uncertain tax positions in
2011, compared to unfavorable changes in 2010, and the
decrease in the effective tax rate from the effect of the change
in the tax treatment of retiree health care costs in 2010.
2010 versus 2009
Ameren Corporation
Ameren’s effective tax rate was higher in 2010 than in
2009, primarily due to the unfavorable impact of the
goodwill impairment charge and the effect of the change in
the tax treatment of retiree health care costs. Additional
variations are discussed below.
Variations in effective tax rates for Ameren’s business
segments and for the Ameren Companies between 2010
and 2009 were as follows.
Ameren Missouri
Ameren Missouri’s effective tax rate was higher,
primarily because of the change in tax treatment of retiree
health care costs, along with the decreased impact of
favorable net amortization of property-related regulatory
assets and liabilities and other permanent items on higher
pretax book income.
Ameren Illinois Regulated Segment
The effective tax rate was higher, primarily because of
the decreased impact of favorable net amortization of
property-related regulatory assets and liabilities and
permanent items on higher pretax book income.
Merchant Generation
The effective tax rate was lower in the Merchant
Generation segment, because of items detailed below at
Genco, partially offset by the impact of state tax credits
related to capital investments and decreased Internal
Revenue Code Section 199 production activity deductions
on a pretax book loss.
Genco
The effective tax rate increased, after the impact of the
nondeductible goodwill impairment charge was excluded,
primarily because of the change in tax treatment of retiree
health care costs and changes to reserves for uncertain tax
positions mitigated by the increased impact of state tax
credits, Internal Revenue Code Section 199 production
activity deductions, and investment tax credit amortization
on lower pretax book income.
On October 1, 2010, Ameren, CIPS, CILCO, IP, AERG
and AER completed a two-step corporate internal
reorganization. The first step of the reorganization was the
Ameren Illinois Merger. The second step of the
reorganization involved the distribution of AERG stock from
Ameren Illinois to Ameren and the subsequent contribution
by Ameren of the AERG stock to AER. Ameren Illinois
determined that the operating results of AERG qualified for
discontinued operations presentation. We have therefore
segregated AERG’s operating results and presented them
separately as discontinued operations for all periods
presented prior to October 1, 2010, in this report. For
Ameren’s financial statements, AERG’s results of operation
remain classified as continuing operations. See Note 16 –
Corporate Reorganization and Discontinued Operations
under Part II, Item 8, of this report for additional
information.
Ameren Illinois’ income from discontinued operations
(AERG) decreased $74 million in 2010, compared with
2009. AERG’s results of operations were included in
Ameren Illinois’ consolidated statement of income for all
periods prior to October 1, 2010. The inclusion of only nine
months in 2010 contributed to the decrease in income from
discontinued operations as well as a decrease in electric
margins caused by lower realized revenue per megawatt
sold and higher fuel and related transportation costs. The
decrease was partially offset by a reduction in income tax
expense primarily caused by lower pretax book income.
LIQUIDITY AND CAPITAL RESOURCES
The tariff-based gross margins of Ameren’s rate-
regulated utility operating companies continue to be a
principal source of cash from operating activities for
Ameren and its rate-regulated subsidiaries. A diversified
retail customer mix of primarily rate-regulated residential,
commercial, and industrial classes and a commodity mix of
natural gas and electric service provide a reasonably
predictable source of cash flows for Ameren, Ameren
Missouri and Ameren Illinois. For operating cash flows,
Genco, through Marketing Company, sells power through
primarily market-based contracts with wholesale and retail
customers. In addition to using cash flows from operating
activities, the Ameren Companies use available cash, credit
facility borrowings, commercial paper issuances, money
pool borrowings, or other short-term borrowings from
affiliates to support normal operations and other temporary
capital requirements. The Ameren Companies may reduce
their credit facility or short-term borrowings with cash from
operations or, at their discretion, with long-term borrowings
or, in the case of Ameren subsidiaries, with equity infusions
from Ameren. The Ameren Companies expect to incur
significant capital expenditures over the next five years as
they comply with environmental regulations and make
significant investments in their electric and natural gas
utility infrastructure to support overall system reliability and
51
other improvements. Ameren intends to finance those
capital expenditures and investments with a blend of equity
and debt so that it maintains a capital structure in its rate-
regulated businesses of approximately 50% to 55% equity,
assuming constructive regulatory environments. Ameren,
Ameren Missouri and Ameren Illinois plan to implement
their long-term financing plans for debt, equity, or equity-
linked securities in order to finance their operations
appropriately, meet scheduled debt maturities, and maintain
financial strength and flexibility. Genco and the Merchant
Generation segment seek to fund their operations internally
and therefore seek not to rely on financing from Ameren or
external, third-party sources. Genco and the Merchant
Generation segment will continue to seek to defer capital
and operating expenses, sell certain assets, and take other
actions as necessary to fund their operations internally
while maintaining safe and reliable operations. Under its
indenture, Genco may not borrow additional funds from
external, third-party sources if its interest coverage ratio is
less than a specified minimum or its leverage ratio is
greater than a specified maximum. See Note 5 – Long-term
Debt and Equity Financings under Part II, Item 8, of this
report for additional information on Genco’s indenture
provisions. Based on projections as of December 31, 2011,
of Genco’s operating results and cash flows, we expect that,
by the end of the first quarter of 2013, Genco’s interest
coverage ratio will be less than the minimum ratio required
for the company to borrow additional funds from external,
third-party sources. Genco’s indenture does not restrict
intercompany borrowings from Ameren’s non-state-
regulated subsidiary money pool. However, borrowings
from the money pool are subject to Ameren’s control, and if
a Genco intercompany financing need were to arise,
borrowings from the non-state-regulated subsidiary money
pool by Genco would be dependent on consideration by
Ameren of the facts and circumstances existing at that time.
The following table presents net cash provided by (used in) operating, investing and financing activities for the years
ended December 31, 2011, 2010, and 2009:
Net Cash Provided By
Operating Activities
Net Cash (Used In)
Investing Activities
Net Cash Provided By
(Used In) Financing Activities
2011
2010
2009
2011
2010
2009
2011
2010
2009
$
. . . . . . . . . . .
Ameren(a)
Ameren Missouri
. . . . .
Ameren Illinois . . . . . . .
Genco . . . . . . . . . . . . . .
$
$
1,878
1,056
504
215
1,823
969
593
304
1,967
975
845
253
$
(1,048) $ (1,096) $ (1,781) $
(700)
(247)
(29)
(957)
(442)
(389)
(627)
(296)
(141)
(1,120) $ (804) $
(430)
(509)
(72)
(334)
(330)
(275)
344
249
(147)
139
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
Cash Flows from Operating Activities
2011 versus 2010
Ameren Corporation
Ameren’s cash from operating activities increased in
2011, compared with 2010. The following items contributed
to the increase in cash from operating activities during
2011, compared with 2010:
‰
‰
‰
Ameren Missouri’s regulatory asset for FAC under-
recovery decreased by $216 million as more deferred
costs were recovered from customers during 2011.
Trade accounts receivable and unbilled revenues
balances decreased, primarily because of milder
weather in the fourth quarter of 2011, compared with
the fourth quarter of 2010. Those same weather
conditions caused accounts payable balances to MISO
and natural gas suppliers to decrease as less power
and natural gas was purchased. Additionally, during
2011, MISO shortened the length of its settlement
terms for all of its members. The new terms resulted in
an acceleration of payments that previously would not
have been paid until 2012. These factors resulted in a
net increase of $120 million in cash from operating
activities in 2011 compared with 2010.
A net $100 million decrease in collateral posted with
counterparties due primarily to the items discussed at
the registrant subsidiaries below, partially offset by a
‰
‰
‰
decrease in collateral returned from Ameren
counterparties of $10 million and additional collateral
posted to counterparties of $4 million due to changes
in the market price of power.
Deferred budget billing receivables decreased by
$71 million, partially as a result of milder weather.
A $45 million decrease in interest payments, primarily
due to the long-term debt redemptions at the registrant
subsidiaries discussed below and a reduction in
Ameren’s borrowings under its credit facility
agreements, which resulted in an $11 million reduction
in interest payments.
An $11 million reduction in payments for scheduled
nuclear refueling and maintenance outages at the
Callaway energy center caused primarily by the timing
of the 2011 outage compared with the 2010 outage,
which had unpaid liabilities as of December 31, 2011.
The following items reduced the increase in Ameren’s cash
from operating activities during 2011, compared with
2010:
‰
A $115 million increase in pension and OPEB plan
contributions. Ameren Illinois contributed to Ameren’s
postretirement benefit VEBA trust an incremental
$100 million in excess of Ameren Illinois’ annual
postretirement net periodic cost for regulatory
purposes.
Electric and natural gas margins, as discussed in
Results of Operations, decreased by $86 million,
‰
52
‰
‰
‰
‰
‰
‰
‰
‰
‰
‰
‰
excluding impacts of noncash MTM transactions.
During 2010, Ameren’s Merchant Generation coal-fired
energy centers, significantly reduced their coal
inventory levels, which resulted in an estimated
$64 million cash savings in excess of the smaller
inventory reduction that occurred in 2011.
A $55 million decrease associated with the December
2005 Taum Sauk incident, primarily as a result of
insurance recoveries received in 2010, but not in 2011.
A $34 million increase in major storm restoration costs.
A $31 million decrease in income tax refunds. The 2010
refund resulted primarily from a 2009 change in tax
treatment of electric generation plant expenditures
while the 2011 refund resulted primarily from casualty
loss deductions due to an Internal Revenue Service
audit settlement. Ameren did not make any federal
income tax payments in 2011 because of accelerated
deductions authorized by economic stimulus
legislation, use of its net operating loss carryforwards,
and other deductions.
A $30 million increase in taxes other than income tax
payments related to higher assessed property tax
values for energy center enhancements, county
property tax rate increases, the timing of property tax
payments at each year end for Ameren Missouri.
Ameren Illinois incurred an increase in electricity
distribution and invested capital tax payments resulting
from the tiered rate structure for the merged entity.
Reduced collections as more utility customers were
past due on their bills on December 31, 2011, than on
December 31, 2010. Additionally, write-offs of
customer receivable balances increased because of
economic conditions.
An $18 million increase in Ameren Missouri receivables
held in court registries under the appeals of the
MoPSC’s 2009 and 2010 rate orders. See Note 2 – Rate
and Regulatory Matters under Part II, Item 8, of this
report for additional information.
A $16 million decrease in Ameren Illinois’ electric
purchased power commodity over-recovered costs.
A $15 million increase in energy efficiency expenditures
for new customer programs. The Ameren Illinois
amount is recovered through customer billings over
time.
An $11 million decrease in natural gas commodity
over-recovered costs under the PGA, primarily in
Illinois.
A $7 million increase in preliminary study expenditures,
primarily at Ameren Missouri for environmental
compliance testing.
Ameren Missouri
Ameren Missouri’s cash from operating activities
increased in 2011 compared with 2010. The following items
contributed to the increase in cash from operating activities
during 2011, compared with 2010:
‰
The regulatory asset for FAC under-recovery decreased
by $216 million as more deferred costs were recovered
from customers during 2011.
‰
‰
‰
‰
‰
‰
Trade accounts receivable and unbilled revenue
balances decreased by $65 million, primarily because
of milder weather in the fourth quarter of 2011,
compared with the fourth quarter of 2010.
Deferred budget billing receivables decreased by
$33 million, partially as a result of milder weather.
Electric and natural gas margins, as discussed in
Results of Operations, increased by $25 million,
excluding impacts of noncash MTM transactions.
A $16 million decrease in payments associated with
major outages at coal-fired energy centers, primarily
because the scope of the major outages in 2011 were
not as extensive as the scope of the major outages
performed in 2010.
An $11 million reduction in payments due to the timing
of scheduled nuclear refueling and maintenance
outages at the Callaway energy center as discussed
above.
A $4 million decrease in interest payments, primarily
due to the redemption of subordinated deferrable
interest debentures in September 2010.
The following items reduced the increase in Ameren
Missouri’s cash from operating activities during 2011,
compared with 2010:
‰
‰
‰
‰
‰
‰
‰
‰
‰
Income tax payments of $9 million in 2011, compared
with income tax refunds of $106 million in 2010. The
2010 refund resulted primarily from a 2009 change in
tax treatment of electric generation plant expenditures
and accelerated deductions authorized by economic
stimulus legislation. Ameren Missouri’s 2011 tax
liability was reduced by accelerated deductions
authorized by economic stimulus legislation, use of its
net operating loss carryforwards, and other deductions.
A $55 million decrease associated with the December
2005 Taum Sauk incident, primarily as a result of
insurance recoveries received in 2010, but not in 2011.
A $23 million increase in property tax payments caused
primarily by higher assessed tax values for energy
center enhancements, county tax rate increases, and
the timing of property tax payments at each year end.
A $21 million increase in major storm restoration costs.
An $18 million increase in receivables held in court
registries under the appeals of the MoPSC’s 2009 and
2010 rate orders.
Reduced collections as more customers were past due
on their bills on December 31, 2011, than on
December 31, 2010. Additionally, write-offs of
customer receivable balances increased because of
economic conditions.
A net $6 million decrease in collateral returned from
exchange counterparties and, to a lesser extent,
additional collateral postings to MISO, all due to
changes in the market price of power and natural gas.
A $6 million increase in energy efficiency expenditures
for new customer programs.
A $6 million increase in preliminary study expenditures,
primarily for environmental compliance testing.
53
Ameren Illinois
Ameren Illinois’ cash from operating activities
decreased in 2011 compared with 2010. Ameren Illinois’
cash from operating activities included AERG’s operating
cash flows for all periods prior to October 1, 2010, which
were presented as discontinued operations in Ameren
Illinois’ consolidated statement of cash flows. Excluding the
impacts of discontinued operations, Ameren Illinois’ cash
from operating activities decreased in 2011 compared with
2010. The following items contributed to the decrease in
cash from operating activities associated with continuing
operations during 2011, compared with 2010:
‰
‰
‰
‰
‰
‰
‰
‰
‰
A $103 million increase in pension and OPEB plan
contributions. Ameren Illinois contributed to Ameren’s
postretirement benefit VEBA trust an incremental
$100 million in excess of Ameren Illinois’ annual
postretirement net periodic cost for regulatory purposes.
A $38 million decrease in income tax refunds caused
primarily by a reduction in transmission and
distribution repair deductions, partially offset by
additional casualty loss deductions from an Internal
Revenue Service audit settlement. Ameren Illinois did
not make any federal income tax payments in 2011
because of accelerated deductions authorized by
economic stimulus legislation and other deductions.
Electric and natural gas margins, as discussed in
Results of Operations, decreased by $30 million,
excluding impacts of noncash MTM transactions.
A $16 million decrease in electric purchased power
commodity over-recovered costs.
A $13 million increase in major storm restoration costs.
Reduced collection results as more customers were
past due on their bills on December 31, 2011, than on
December 31, 2010. Additionally, write-offs of
customer receivable balances increased because of
economic conditions.
A $9 million increase in taxes other than income
payments, due primarily to an increase in electricity
distribution and invested capital tax payments resulting
from the tiered rate structure for the merged entity.
A $9 million decrease in natural gas commodity over-
recovered costs under the PGA.
A $9 million increase in energy efficiency expenditures
for new customer programs. These expenditures are
recovered through customer billings over time.
The following items reduced the decrease in Ameren
Illinois’ cash from operating activities associated with
continuing operations during 2011, compared with 2010:
‰
‰
A net $120 million decrease in collateral posted with
counterparties due, in part, to a reduction in the market
price of natural gas and in contracted volumes.
Trade accounts receivable and unbilled revenues
balances decreased, primarily because of milder
weather in the fourth quarter of 2011, compared with
the fourth quarter of 2010. Those same weather
conditions caused accounts payable balances to MISO
and natural gas suppliers to decrease as less power
and natural gas was purchased. Additionally, during
2011, MISO shortened the length of its settlement
terms for all of its members. The new terms resulted in
an acceleration of payments that previously would not
have been paid until 2012. These factors resulted in a
net increase of $63 million in cash from operating
activities in 2011 compared with 2010.
Deferred budget billing balances decreased by
$38 million, partially as a result of milder weather.
An $11 million decrease in interest payments, primarily
due to the redemption of first mortgage bonds in
September 2010.
‰
‰
Genco
Genco’s cash from operating activities decreased in
2011 compared with 2010. The following items contributed
to the decrease in cash from operating activities during
2011, compared with 2010:
‰
‰
‰
‰
‰
Electric margins, as discussed in Result of Operations,
decreased by $63 million, excluding impacts of
noncash MTM transactions.
During 2010, Genco significantly reduced the volume of
its coal inventory, which resulted in an estimated
$43 million cash savings in excess of the smaller
inventory reduction that occurred in 2011.
The January 2010 receipt from Marketing Company for
December 2009 generation output was $16 million
higher than the January 2011 receipt for December
2010 generation output. This was primarily caused by
the inclusion of higher-priced sales contracts from the
2006 Illinois power procurement auction, which expired
in May 2010.
A $9 million increase in payments associated with
major outages at coal-fired energy centers, primarily
because the scope of the major outages in 2011 were
more extensive than the scope of the major outages
performed in 2010.
An $8 million increase in pension plan contributions as
EEI made a contribution in 2011, but made no
contribution in 2010.
The following items reduced the decrease in Genco’s
cash from operating activities during 2011, compared with
2010:
‰
‰
Income tax refunds of $25 million in 2011, compared
with income tax payments of $1 million in 2010. The
2011 refund was primarily due to an increase in
accelerated depreciation deductions authorized by the
economic stimulus legislation. Genco did not make any
federal income tax payments in 2011 primarily because
of accelerated deductions related to pollution control
equipment, economic stimulus legislation and
deductions related to the closure of Meredosia and
Hutsonville energy centers.
A $20 million decrease in interest payments, primarily
due to the redemption of senior notes in November
2010.
54
2010 versus 2009
Ameren’s cash from operating activities decreased in
2010 compared with 2009. The following items contributed
to the decrease in cash from operating activities during
2010, compared with 2009:
‰
‰
‰
‰
‰
‰
‰
‰
‰
‰
‰
A $116 million decrease in billed revenues, net of
payments to suppliers, for pass-through natural gas
commodity costs primarily caused by higher-priced
natural gas injected into storage during 2008 and billed
to customers in 2009.
Accounts receivable and unbilled revenue balances
increased by $106 million, primarily because of higher
utility rates and colder December weather in 2010,
compared with December 2009.
Deferred FAC costs increased $100 million as net base
fuel costs incurred at Ameren Missouri exceeded the
amounts allowed in base rates due to higher fuel costs
and lower off-system sales as a result of warmer
weather increasing native load demand.
Deferred budget billing balances increased by
$74 million, partially as a result of warmer summer
weather, which increased sales volumes over budget-
billed amounts.
An overall $56 million increase in collateral posted with
counterparties due, in part, to the items discussed at
the subsidiaries below, offset by a $105 million
reduction in collateral posted by nonregistrant
subsidiaries, primarily due to changes in the market
price of power.
A $53 million decrease associated with the December
2005 Taum Sauk incident, primarily as a result of
reduced insurance recoveries.
A $39 million increase in payments related to the
Callaway energy center refueling and maintenance
outage that occurred in 2010, but did not occur in 2009.
A $14 million increase in payments associated with
major outages at coal-fired plants, primarily at Ameren
Missouri.
A $12 million increase in property tax payments caused
primarily by higher assessed tax rates in Missouri.
A $10 million one-time donation in 2010 for customer
assistance programs required by the 2009 Illinois
energy legislation that authorized the bad debt rate
adjustment mechanism used by Ameren Illinois.
Payments for professional services, additional franchise
taxes, and other administrative items necessary to
complete the Ameren Illinois Merger and AERG
distribution totaled $8 million.
The following items reduced the decrease in Ameren’s
cash from operating activities during 2010, compared with
2009:
‰
‰
Electric and natural gas margins, as discussed in
Results of Operations, increased by $212 million,
excluding impacts of noncash MTM transactions.
Income tax refunds of $92 million in 2010, compared
with income tax payments of $9 million in 2009. The
refund primarily resulted from an acceleration of
‰
‰
‰
‰
depreciation deductions authorized by economic
stimulus legislation.
Ameren reduced its coal inventory levels, primarily at
the Merchant Generation segment, in 2010. The
inventory reduction is estimated to have resulted in
cash savings of $69 million in 2010.
A $32 million decrease in major storm restoration
costs.
Contributions to the pension and postretirement plans
were $31 million lower in 2010.
A $14 million reduction in severance payments as a
result of the voluntary and involuntary separation
programs initiated in both years.
Ameren Missouri
Ameren Missouri’s cash from operating activities
decreased in 2010 compared with 2009. The following
items contributed to the decrease in cash from operating
activities during 2010, compared with 2009:
‰
‰
‰
‰
‰
‰
‰
A $102 million decrease in income tax refunds,
primarily due to higher pretax book income and a
reduction in 2010 of the benefit of a change in tax
treatment of electric generation plant expenditures
taken in 2009.
Deferred FAC costs increased $100 million as net base
fuel costs incurred exceeded the amounts allowed in
base rates due to higher fuel costs and lower
off-system sales as a result of warmer weather
increasing native load demand.
A $53 million decrease associated with the December
2005 Taum Sauk incident discussed above.
A $39 million increase in payments related to a
Callaway nuclear plant refueling and maintenance
outage that occurred in 2010, but did not occur in
2009.
A $24 million increase in payments associated with
major outages at coal-fired plants.
A $12 million increase in property tax payments,
caused primarily by higher assessed tax rates.
An $11 million increase in energy efficiency
expenditures for new customer programs.
The following items reduced the decrease in Ameren
Missouri’s cash from operating activities during 2010,
compared with 2009:
‰
‰
‰
‰
‰
Electric and natural gas margins as discussed in
Results of Operations, increased by $281 million,
excluding the noncash impacts of MTM transactions.
A $31 million reduction in collateral posted with
counterparties due in part to improved credit ratings and
to changes in the market price of power and natural gas.
A $13 million decrease in major storm restoration
costs.
Contributions to the pension and postretirement plans
were $8 million lower in 2010.
A $5 million reduction in severance payments as a
result of the voluntary and involuntary separation
programs initiated in both years.
55
Ameren Illinois
Ameren Illinois’ cash from operating activities
decreased in 2010 compared with 2009. Ameren Illinois’
cash from operating activities included AERG’s operating
cash flows for all periods prior to October 1, 2010, which
were presented as discontinued operations in Ameren
Illinois’ consolidated statement of cash flows. Excluding the
impacts of discontinued operations, Ameren Illinois’ cash
from operating activities decreased in 2010 compared with
2009. The following items contributed to the decrease in
cash from operating activities associated with continuing
operations during 2010, compared with 2009:
‰
‰
‰
‰
‰
‰
‰
A $192 million increase in collateral posted with
counterparties due, in part, to changes in the market
price of natural gas and collateral posting requirements.
Accounts receivable and unbilled revenue balances
increased by $183 million, primarily because of higher
utility rates and colder December weather in 2010,
compared with December 2009.
A $98 million decrease in billed revenues, net of
payments to suppliers, for pass-through natural gas
commodity costs primarily caused by higher-priced
natural gas injected into storage during 2008 and billed
to customers in 2009.
Deferred budget billing balances increased by
$60 million, partially as a result of warmer summer
weather, which increased sales volumes over budget
billed amounts.
A $10 million one-time donation in 2010 for customer
assistance programs required by the 2009 Illinois
legislation that authorized the bad debt rate adjustment
mechanism.
Payments for professional services, additional franchise
taxes, and other administrative items necessary to
complete the Ameren Illinois Merger and AERG
distribution, which totaled $7 million.
In 2009, Ameren Illinois received $5 million from
Marketing Company for the costs of upgrades to
Ameren Illinois’ electric transmission system. There
was no such receipt in 2010.
The following items reduced the decrease in Ameren
Illinois’ cash from operating activities associated with
continuing operations during 2010, compared with 2009:
‰
‰
‰
‰
‰
Electric and natural gas margins, as discussed in
Results of Operations, increased by $187 million,
excluding the noncash impacts of MTM transactions.
Income tax refunds of $52 million in 2010, compared
with income tax payments of $61 million in 2009. The
refund resulted primarily from an acceleration of
depreciation deductions authorized by economic
stimulus legislation.
A $19 million decrease in major storm restoration
costs.
Contributions to the pension and postretirement plans
were $11 million lower in 2010.
A $6 million decrease in interest payments, primarily
because of the first mortgage bond maturity in June
2009.
Ameren Illinois’ cash from operating activities associated
with discontinued operations decreased in 2010 compared
with 2009. AERG’s cash flows were included in Ameren
Illinois’ consolidated statement of cash flows for all periods
prior to October 1, 2010. The inclusion of only nine months in
2010 was the primary cause of the decrease in cash flows,
along with a reduction in receipts from Marketing Company
under the AERG PSA, primarily due to lower market prices. A
decrease in income tax payments, primarily due to lower
pretax book income, and an acceleration of depreciation
deductions authorized by economic stimulus legislation
partially offset the decrease in AERG’s operating cash flows.
Genco
Genco’s cash from operating activities increased in
2010 compared with 2009. The following items contributed
to the increase in cash from operating activities during
2010, compared with 2009:
‰
A $73 million decrease in income tax payments,
primarily due to lower pretax book income, deductions
relating to environmental expenditures, and an
acceleration of depreciation deductions authorized by
economic stimulus legislation.
Reduced coal inventory levels in 2010, which are
estimated to have resulted in cash savings of $50 million
in 2010.
Lower labor expenditures resulting from staff
reductions and fewer major outages at its coal-fired
plants.
A $7 million reduction in use tax payments as Genco
and EEI began claiming tax exemptions and credits for
purchase transactions related to their generation
operations.
Contributions to the pension plans were $6 million
lower in 2010.
‰
‰
‰
‰
The following items reduced the increase in Genco’s
cash from operating activities during 2010, compared with
2009:
‰
‰
Electric margins, as discussed in Result of Operations,
decreased by $99 million, excluding impacts of
noncash MTM transactions.
A $13 million increase in interest payments, primarily
due to the senior unsecured notes issued in November
2009, which required interest payments in 2010, but
not in 2009.
Pension Funding
Ameren’s pension plans are funded in compliance with
income tax regulations and to meet federal funding or
regulatory requirements. As a result, Ameren expects to
fund its pension plans at a level equal to the greater of the
pension expense or the legally required minimum
contribution. Considering Ameren’s assumptions at
December 31, 2011, its investment performance in 2011,
and its pension funding policy, Ameren expects to make
annual contributions of $90 million to $150 million in each
of the next five years, with aggregate estimated
contributions of $580 million. We expect Ameren
56
Missouri’s, Ameren Illinois’, and Genco’s portion of the
future funding requirements to be 51%, 33% and 12%,
respectively. These amounts are estimates. The estimates
may change with actual investment performance, changes
in interest rates, changes in our assumptions, any pertinent
changes in government regulations, and any voluntary
contributions. In 2011, Ameren contributed $103 million to
its pension plans. See Note 11 – Retirement Benefits under
Part II, Item 8, of this report for additional information.
Cash Flows from Investing Activities
2011 versus 2010
Ameren’s cash used in investing activities decreased
by $48 million during 2011, compared with 2010. In 2011,
cash flows from investing activities benefited from an
increase of proceeds from property sales as well as
$8 million in proceeds from the sale of its investment in a
leveraged lease and a $9 million payment received from the
DOE under the terms of Ameren Missouri’s settlement with
the DOE in 2011 related to nuclear waste disposal. Net cash
used for capital expenditures decreased $12 million during
2011, compared with 2010. Reductions in capital
expenditures caused by the completion of two energy
center scrubber projects in 2010 were offset, in part, by an
increase in storm-related repair costs, an increase in
electric transmission investments, and expenditures for a
third energy center scrubber project in 2011.
Ameren Missouri’s cash used in investing activities
decreased by $73 million during 2011, compared with 2010,
principally because of a $74 million decrease in capital
expenditures and a $9 million payment received from the
DOE in 2011 under the terms of the settlement with the DOE
related to nuclear waste disposal. These cash benefits were
reduced by a $6 million net decrease in nuclear
decommissioning trust fund activities. Capital expenditures
were lower in 2011 as a result of the completion in 2010 of
two scrubbers at Ameren Missouri’s Sioux energy center and
boiler projects, which offset a $28 million increase in capital
expenditures related to storm-related repair costs.
Ameren Illinois’ cash used in investing activities
increased by $49 million during 2011, compared with 2010.
There was a $70 million increase in capital expenditures
primarily as a result of increased investment in electric
transmission assets and a $17 million increase in capital
expenditures related to storm-related repair costs. In 2011,
cash flows from investing activities benefited from the
repayments of advances previously paid to ATXI, as a result
of the completion of a project under a joint ownership
agreement. In 2010, cash flows from investing activities
benefited from the proceeds received on an intercompany
note receivable, offset, in part, by advances to ATXI.
Genco’s cash used in investing activities increased by
$112 million during 2011, compared with 2010. Net cash
used for capital expenditures increased by $46 million
primarily as a result of increased spending for energy center
scrubber projects and boiler projects. The Coffeen energy
center scrubber project was completed in February 2010, and
construction began in April 2011 on Genco’s Newton energy
center scrubber project. In 2011, cash flows from investing
activities benefited from the proceeds of property sales,
principally attributed to $45 million of proceeds received from
the sale of Genco’s remaining interest in its Columbia CT
facility. In 2010, cash flows from investing activities benefited
from the proceeds received from the sale of 25% of Genco’s
Columbia CT facility. During 2011, cash provided by sales of
properties enabled Genco to contribute net non-state-
regulated subsidiaries’ money pool advances of $49 million.
During 2010, Genco received $48 million in net repayment of
non-state-regulated subsidiaries’ money pool advances.
2010 versus 2009
Ameren’s cash used in investing activities decreased
by $685 million during 2010, compared with 2009. There
was a $668 million decrease in capital expenditures as
compared with 2009 as a result of reductions in planned
capital expenditures for the distribution system and energy
center improvements during 2010, a $109 million reduction
in capital expenditures to repair severe storm damage, and
the completion of energy center scrubber projects in the
Merchant Generation segment during 2009 and early 2010.
Cash flows from investing activities in 2010 also benefited
from the sale of 25% of Genco’s Columbia CT facility and
other properties.
Ameren Missouri’s cash used in investing activities
decreased by $257 million during 2010, compared with
2009. There was a $258 million decrease in capital
expenditures as compared with 2009 as a result of
reductions in planned capital expenditures for the
distribution system and energy center improvements during
2010, as well as a $74 million reduction in capital
expenditures to repair severe storm damage. This cash
benefit was reduced by a $12 million net decrease in
nuclear decommissioning trust fund activities.
Ameren Illinois’ cash used in investing activities
decreased by $195 million during 2010, compared with
2009. There was a $71 million decrease in capital
expenditures compared with 2009 because Ameren Illinois
reduced planned capital expenditures for the distribution
system during 2010 after receiving significantly less than it
requested in a rate proceeding, as well as a $35 million
reduction in capital expenditures to repair severe storm
damage. Similar planned capital expenditure reductions at
AERG resulted in the $85 million decrease in capital
expenditures of discontinued operations. Additionally,
Ameren Illinois’ advances to ATXI for construction under a
joint ownership agreement decreased during 2010 as the
project approached completion. Ameren Illinois received
funding for this construction under a generator
interconnection agreement related to ongoing transmission
upgrade projects.
Genco’s cash used in investing activities decreased by
$360 million during 2010, compared with 2009. Reductions
in planned capital expenditures, as well as completion of
energy center scrubber projects during 2009, resulted in a
$221 million decrease in capital expenditures compared
with 2009. Cash flows from investing activities in 2010 also
57
benefited from the $18 million of proceeds Genco received
from the sale of 25% of its Columbia CT facility and net
repayment of non-state-regulated subsidiaries’ money pool
advances.
Capital Expenditures
The following table presents the capital expenditures
by the Ameren Companies for the years ended
December 31, 2011, 2010, and 2009:
Capital Expenditures
2011
2010
2009
Ameren(a) . . . . . . . . . . . . . . . . . . . . . . $
Ameren Missouri . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . .
Merchant Generation-Genco . . . . . . .
Merchant Generation-Other . . . . . . . .
1,030 $
550
351
141
12
1,042 $
624
281
95
6
1,710
882
352
316
92
(a)
Includes amounts for Ameren registrant and nonregistrant
subsidiaries and the elimination of intercompany transfers.
Ameren’s 2011 capital expenditures principally
consisted of the following expenditures at its subsidiaries.
Ameren Missouri spent $24 million on building its Maryland
Heights energy center and $31 million for storm-related
repair costs. Ameren Illinois incurred storm-related repair
costs of $20 million. Genco spent $75 million toward
scrubbers at its Newton and Coffeen energy centers for
compliance with environmental regulations. Other capital
expenditures were made principally to maintain, upgrade,
and expand the reliability of the transmission and
distribution systems of Ameren Missouri and Ameren
Illinois, as well as to fund various energy center upgrades.
Ameren’s 2010 capital expenditures principally
consisted of the following expenditures at its subsidiaries.
Ameren Missouri spent $130 million toward two scrubbers
at its Sioux energy center, which were completed in 2010.
At Genco, there was a cash outlay of $29 million for energy
center scrubber projects. The scrubbers are necessary to
comply with environmental regulations. Other capital
expenditures were made principally to maintain, upgrade,
and expand the reliability of the transmission and
distribution systems of Ameren Missouri and Ameren
Illinois, as well as to fund various energy center upgrades.
Ameren’s 2009 capital expenditures consisted
principally of the following expenditures at its subsidiaries.
Ameren Missouri spent $173 million toward two scrubbers
at its Sioux energy center, $93 million toward the Taum
Sauk rebuild, and it incurred storm-related expenditures of
$78 million. Ameren Illinois incurred storm-related repair
costs of $38 million. At Genco, there was a cash outlay of
$169 million for energy center scrubber projects. The
scrubbers are necessary to comply with environmental
regulations. Other capital expenditures were made
principally to maintain, upgrade, and expand the reliability
of the transmission and distribution systems of Ameren
Missouri and Ameren Illinois as well as various energy
center upgrades.
The following table estimates the capital expenditures
that will be incurred by the Ameren Companies from 2012
through 2016, including construction expenditures,
capitalized interest for the Merchant Generation business,
allowance for funds used during construction for our rate-
regulated utility businesses, and estimated expenditures for
compliance with known and existing environmental
regulations. As a result of a sharp decline in forward power
prices in early 2012, as well as uncertain environmental
regulations, Genco is decelerating the construction of two
scrubbers at its Newton energy center, and AERG has
removed the previously planned precipitator upgrades at its
E.D. Edwards energy center from the five-year capital
expenditures forecast. Genco will continue to incur some
ongoing capital costs related to the construction of the
Newton scrubbers. The table below includes Genco’s
estimated capital expenditures of approximately
$150 million in 2012 and approximately $20 million
annually from 2013 through 2016 for the installation of the
two scrubbers, excluding capitalized interest. See Outlook
and also Note 15 – Commitments and Contingencies under
Part II, Item 8, of this report for further discussion of the
impact of declining power prices on the Merchant
Generation segment.
2012
2013 - 2016
Total
Ameren Missouri . . . . . . . . . . . . $
Ameren Illinois . . . . . . . . . . . . .
Merchant Generation-Genco . . .
Merchant Generation- Other . . .
ATX/ATXI . . . . . . . . . . . . . . . . . .
Other(a)
. . . . . . . . . . . . . . . . . . .
665 $2,190 - $ 2,960 $ 2,855 - $ 3,625
3,265
2,730
535
395
220
175
55
50
5
870
845
25
55
65
(10)
2,555 -
340 -
40 -
650 -
35 -
2,020 -
165 -
35 -
625 -
45 -
Ameren . . . . . . . . . . . . . . . . . . . $1,395 $ 5,080 - $ 6,870 $ 6,475 - $ 8,265
(a)
Includes the eliminations of intercompany transfers.
Ameren Missouri’s estimated capital expenditures
include transmission, distribution, and generation-related
investments, as well as expenditures for compliance with
environmental regulations discussed below. Ameren Illinois’
estimated capital expenditures are primarily for electric and
natural gas transmission and distribution-related
investments, and expected capital expenditures incremental
to historical average electric delivery capital expenditures to
modernize its distribution system pursuant to the IEIMA.
For additional information on the IEIMA, see Note 2 – Rate
and Regulatory Matters under Part II, Item 8, of this report.
Genco’s estimated capital expenditures are primarily for
compliance with environmental regulations and upgrades to
existing coal and natural gas-fired energy centers discussed
below. Estimated capital expenditures of Ameren
nonregistrant subsidiaries consist primarily of AERG’s
estimated expenditures for compliance with environmental
regulations discussed below and ATX/ATXI’s estimated
transmission expenditures.
We continually review our generation portfolio and
expected power needs. As a result, we could modify our
plan for generation capacity, which could include changing
the times when certain assets will be added to or removed
from our portfolio, the type of generation asset technology
that will be employed, and whether capacity or power may
58
be purchased, among other things. Additionally, we
continually review the reliability of our transmission and
distribution systems, expected capacity needs, and
opportunities for transmission investments. The timing and
amount of investment could vary due to changes in
expected capacity, the condition of transmission and
distribution systems, and the ability and willingness to
pursue transmission investments, among other things. Any
changes that we may plan to make for future generation,
transmission or distribution needs could result in significant
capital expenditures or losses being incurred, which could
be material.
Environmental Capital Expenditures
Ameren, Ameren Missouri and Genco will incur
significant costs in future years to comply with existing and
known federal and state regulations regarding SO2, NOx,
and mercury emissions from coal-fired power plants.
See Note 15 – Commitments and Contingencies under
Part II, Item 8, of this report for a discussion of existing
environmental laws and regulations that affect, or may
affect, our facilities and capital costs to comply with such
laws and regulations, as well as our assessment of the
potential impacts of the EPA’s proposed regulation of CCR
and cooling water intake structures, the MATS, the stayed
CSAPR, and the revised national ambient air quality
standards for SO2 and NOx emissions as of December 31,
2011.
Cash Flows from Financing Activities
2011 versus 2010
During 2011, we reduced our reliance on borrowings
from short-term debt and credit facilities, and we reduced
long-term debt outstanding while maintaining adequate
cash balances for working capital needs.
Ameren’s cash used in financing activities increased in
2011, compared with 2010. During 2011, Ameren’s cash
flow from operating activities of $1.9 billion exceeded its
capital expenditures of $1.0 billion and common stock
dividend requirements of $375 million. Ameren used this
cash as well as cash on hand to repay $581 million of
short-term debt and credit facility borrowings, to redeem
$155 million of long-term debt, and to repay $73 million of
advances previously received from generators due to
project completion. During 2010, Ameren redeemed
$310 million of long-term debt and $52 million of preferred
stock.
Ameren Missouri’s cash used in financing activities
increased by $96 million in 2011, compared with 2010.
During 2011, Ameren Missouri’s cash flow from operating
activities of $1.1 billion exceeded its combined capital and
nuclear fuel expenditures of $612 million. Ameren Missouri
utilized this cash to pay common stock dividends of
$403 million and repay $19 million of advances previously
received from generators due to project completion. During
2010, Ameren Missouri paid common stock dividends of
$235 million; redeemed $70 million of long-term debt,
including its 7.69% Series A subordinated debentures; and
redeemed all outstanding shares of its $7.64 Series
preferred stock.
Ameren Illinois’ net cash used in financing activities
increased by $179 million in 2011 compared with 2010.
Ameren Illinois’ common stock dividend increased
$194 million compared with 2010. In June 2011, Ameren
Illinois’ 6.625% $150 million senior secured notes matured
and were repaid and retired using available cash on hand.
During 2010, in connection with the Ameren Illinois Merger,
Ameren Illinois (formerly CILCO) redeemed all of its
preferred stock and all $40 million of its 7.61% Series
1997-2 first mortgage bonds (formerly CIPS). Net
repayments of generator advances received for construction
increased $25 million in 2011 compared with 2010.
Genco’s net cash used in financing activities decreased
by $203 million in 2011 compared with 2010. During 2011,
Genco’s cash flow from operating activities of $215 million
exceeded its capital expenditures of $141 million.
Additionally, Genco received a capital contribution from
Ameren associated with a tax allocation agreement that
benefited 2011 cash flows from financing activities. Genco
used this cash to reduce its reliance on credit facility
borrowings. In 2010, Genco repaid at maturity $200 million
of its 8.35% senior notes at maturity and repaid a net
$176 million of intercompany note borrowings. These 2010
cash outlays were offset, in part, by credit facility
borrowings.
2010 versus 2009
During 2010, we replaced and extended the expiration
of our credit facilities. We sought to reduce our reliance on
borrowings from our credit facilities and to reduce long-
term debt outstanding while maintaining adequate cash
balances for working capital needs.
Ameren had an $804 million net use of cash from
financing activities in 2010, compared with a $344 million
net source of cash in 2009. During 2010, Ameren’s cash
flow from operating activities of $1.8 billion exceeded its
capital expenditures of $1.0 billion and common stock
dividend requirements of $368 million. Ameren used this
cash to redeem $310 million of long-term debt and
$52 million of preferred stock in 2010. During 2009,
Ameren issued $1 billion of senior debt and $634 million in
common stock. It used the proceeds to repurchase,
redeem, and fund maturities of $631 million of long-term
debt, to reduce short-term borrowings, and to fund capital
expenditures and other working capital needs at Ameren
Missouri, Ameren Illinois, and Genco.
Ameren Missouri had a $334 million net use of cash
from financing activities in 2010, compared with a
$249 million net source of cash in 2009. Planned
reductions of expenditures allowed Ameren Missouri to use
cash from operations and credit facility borrowings to fund
its capital expenditures and working capital needs without
issuing additional senior debt or capital contributions from
59
Ameren. Additionally, during 2010, these efforts allowed
Ameren Missouri to redeem $70 million of long-term debt,
including its 7.69% Series A subordinated debentures; to
redeem all outstanding shares of its $7.64 Series preferred
stock; to increase common stock dividends by $60 million;
and to reduce short-term and intercompany borrowing
repayments by $343 million, compared with 2009.
Ameren Illinois’ net cash used in financing activities
increased by $183 million in 2010 compared with 2009.
Reduction of planned expenditures allowed it to use cash
from operations to fund its capital expenditures and
working capital needs without the issuance of additional
senior debt or capital contributions from Ameren.
Additionally, Ameren Illinois’ common stock dividends
increased $35 million compared with 2009, and CILCO
redeemed all of its preferred stock in connection with the
Ameren Illinois Merger. During 2009, Ameren made capital
contributions to Ameren Illinois of $272 million and Ameren
Illinois repaid $250 million of long-term debt and
$62 million of short-term borrowing balances.
Genco had a $275 million net use of cash from
financing activities in 2010, compared with a $139 million
net source of cash in 2009, primarily as a result of
reductions of planned expenditures. These efforts allowed
Genco to use cash from operations and credit facility
borrowings to fund capital expenditures, to meet working
capital needs, to repay its $200 million of 8.35% senior
notes at maturity, and to repay a net $176 million of
intercompany note borrowings in 2010. During 2009,
Genco issued $249 million of long-term debt and used the
proceeds to repay short-term borrowings and to fund
general corporate purposes.
Credit Facility Borrowings and Liquidity
The liquidity needs of the Ameren Companies are
typically supported through the use of available cash, short-
term intercompany borrowings, drawings under committed
bank credit facilities, or commercial paper issuances. See
Note 4 – Short-Term Debt and Liquidity under Part II,
Item 8, of this report for additional information on credit
facilities, short-term borrowing activity, commercial paper
activity, relevant interest rates, and borrowings under
Ameren’s utility and non-state-regulated subsidiary money
pool arrangements.
60
The following table presents the committed 2010 Credit Agreements of Ameren and the Ameren Companies, and the
credit capacity available under such agreements, considering reductions for commercial paper borrowings and letters of credit,
as of December 31, 2011:
Ameren and Ameren Missouri:
2010 Missouri Credit Agreement(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 2013
$
800
$
800
Expiration
Borrowing Capacity
Credit Available
Ameren and Genco:
2010 Genco Credit Agreement(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 2013
Ameren and Ameren Illinois:
2010 Illinois Credit Agreement(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 2013
500
800
Ameren:
Less:
Commercial paper outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Letters of credit
500
800
(148)
(15)
Total
$
2,100
$
1,937
(a) The Ameren Companies may access these credit facilities through intercompany borrowing arrangements.
In February 2011, Ameren Illinois received approval
from the ICC to extend the expiration of its borrowing
sublimit under the 2010 Illinois Credit Agreement to
September 10, 2013. In June 2011, Ameren Missouri
received approval from the MoPSC to extend the expiration
of its borrowing sublimit under the 2010 Missouri Credit
Agreement to September 10, 2013.
The 2010 Credit Agreements are used to make cash
borrowings, to issue letters of credit, and to support
borrowings under Ameren’s $500 million commercial paper
program, Ameren Missouri’s $500 million commercial paper
program, and Ameren Illinois’ $500 million commercial paper
program, the latter of which was created in October 2011.
Any of the 2010 Credit Agreements are available to Ameren to
support borrowings under Ameren’s commercial paper
program, subject to borrowing sublimits. The 2010 Missouri
Credit Agreement is available to support borrowings under
Ameren Missouri’s commercial paper program, and the 2010
Illinois Credit Agreement is available to support borrowings
under Ameren Illinois’ commercial paper program.
The maximum aggregate amount available to each
borrower under each facility is shown in the following table
(such amount being such borrower’s “Borrowing
Sublimit”):
2010
Missouri
Credit
Agreement
2010
Genco
Credit
Agreement
2010
Illinois
Credit
Agreement
Ameren . . . . . . . . . . . . .
Ameren Missouri . . . . . .
Ameren Illinois . . . . . . . .
Genco . . . . . . . . . . . . . .
$
$
500
500
(a)
(a)
$
500
(a)
(a)
500
300
(a)
800
(a)
(a) Not applicable.
These credit agreements were also available for use,
subject to applicable regulatory short-term borrowing
authorizations, by EEI or by other Ameren non-state-
regulated subsidiaries through direct short-term borrowings
from Ameren and by most of Ameren’s non-rate-regulated
subsidiaries, including, but not limited to, Ameren Services,
AER, AERG and Marketing Company, through a non-state-
regulated subsidiary money pool agreement. Ameren has
money pool agreements with and among its subsidiaries to
coordinate and to provide for certain short-term cash and
working capital requirements. Separate money pools are
maintained for utility and non-state-regulated entities. In
addition, a unilateral borrowing agreement among Ameren,
Ameren Illinois, and Ameren Services enables Ameren
Illinois to make short-term borrowings directly from
Ameren. Pursuant to the terms of the unilateral borrowing
agreement, the aggregate amount of borrowings
outstanding at any time by Ameren Illinois under the
unilateral borrowing agreement and the utility money pool
agreement, together with any outstanding Ameren Illinois
external credit facility borrowings or commercial paper
issuances, may not exceed $500 million, pursuant to
authorization from the ICC. Ameren Illinois did not borrow
under the unilateral borrowing agreement during 2011 or
2010. Ameren Services is responsible for operation and
administration of the money pool agreements. See Note 4 –
Short-Term Debt and Liquidity under Part II, Item 8, of this
report for a detailed explanation of the money pool
arrangements and the unilateral borrowing agreement.
The issuance of short-term debt securities by
Ameren’s utility subsidiaries is subject to approval by FERC
under the Federal Power Act. In March 2010, FERC issued
an order authorizing the issuance of up to $1 billion of
short-term debt securities for Ameren Missouri. The
authorization was effective as of April 1, 2010, and
terminates on March 31, 2012. On October 1, 2010, FERC
authorized Ameren Illinois to issue up to $1 billion of short-
term debt securities. The authorization became effective
immediately and terminates on September 30, 2012.
Genco has unlimited long and short-term debt
issuance authorization from FERC. EEI has unlimited short-
term debt authorization from FERC.
The issuance of short-term debt securities by Ameren
is not subject to approval by any regulatory body.
The Ameren Companies continually evaluate the
adequacy and appropriateness of their liquidity
arrangements given changing business conditions. When
business conditions warrant, changes may be made to
existing credit facilities or to other short-term borrowing
arrangements.
61
Long-term Debt and Equity
The following table presents the issuances of common stock and the issuances, redemptions, repurchases, and
maturities of long-term debt and preferred stock (net of any issuance discounts and including any redemption premiums) for
the years 2011, 2010, and 2009 for the Ameren Companies. For additional information related to the terms and uses of these
issuances and the sources of funds and terms for the redemptions, see Note 5 – Long-term Debt and Equity Financings under
Part II, Item 8, of this report.
Month Issued, Redeemed,
Repurchased or Matured
2011
2010
2009
Issuances
Long-term debt
Ameren:
8.875% Senior unsecured notes due 2014 . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
8.45% Senior secured notes due 2039 . . . . . . . . . . . . . . . . . . . . . . . . . . .
May
March
Genco:
6.30% Senior unsecured notes due 2020 . . . . . . . . . . . . . . . . . . . . . . . . .
November
Total Ameren long-term debt issuances . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Common stock
Ameren:
21,850,000 shares at $25.25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
DRPlus and 401(k)
September
Various
Total common stock issuances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Ameren long-term debt and common stock issuances . . . . . . . . . . . . .
Redemptions, Repurchases and Maturities
Long-term debt
Ameren:
8.70% Senior unsecured notes due 2009 (formerly CILCORP) . . . . . . . . .
9.375% Senior bonds due 2029 (formerly CILCORP) . . . . . . . . . . . . . . . .
Ameren Missouri:
City of Bowling Green capital lease (Peno Creek CT) . . . . . . . . . . . . . . . . .
7.69% Series A subordinated deferrable interest debentures due 2036 . . .
Ameren Illinois:
6.625% Senior secured notes due 2011 . . . . . . . . . . . . . . . . . . . . . . . . . .
7.50% Series mortgage bonds due 2009 . . . . . . . . . . . . . . . . . . . . . . . . . .
7.61% Series 1997-2 first mortgage bonds due 2017 . . . . . . . . . . . . . . . .
Genco:
October
December
Various
September
June
June
September
Senior notes Series D 8.35% due 2010 . . . . . . . . . . . . . . . . . . . . . . . . .
November
Total Ameren long-term debt redemptions, repurchases and maturities . . . .
Preferred stock
Ameren Missouri:
$7.64 Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
August
Ameren Illinois:
4.50% Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.64% Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.08% Series(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.20% Series(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.26% Series(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.42% Series(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.70% Series(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
7.75% Series(a)
Total Ameren preferred stock redemptions and repurchases . . . . . . . . . . . . .
Total Ameren long-term debt and preferred stock redemptions, repurchases
and maturities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
August
August
September
September
September
September
September
September
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
-
-
-
-
-
65
65
65
-
-
5
-
150
-
-
-
155
$
-
-
-
-
-
80
80
80
-
-
4
66
-
-
40
200
310
$
423
349
249
$
1,021
$
$
$
$
552
82
634
1,655
124
253
4
-
-
250
-
-
$
631
-
-
-
-
-
-
-
-
-
-
155
$
33
$
11
8
7
5
4
3
5
9
85
395
$
$
$
$
-
-
-
-
-
-
-
-
-
-
631
(a)
In September 2010, Ameren contributed to the capital of Ameren Illinois (formerly IP), without the payment of any consideration, all of the IP
preferred stock owned by Ameren ($33 million). IP cancelled these preferred shares.
62
A Form S-3 registration statement filed by Ameren with
the SEC in June 2011 authorized the offering of 6 million
additional shares of its common stock under DRPlus.
Shares of common stock sold under DRPlus are, at
Ameren’s option, newly issued shares, treasury shares, or
shares purchased in the open market or in privately
negotiated transactions. In 2012, Ameren plans for shares
to be purchased in the open market for DRPlus and its
401(k) plan. Under DRPlus and its 401(k) plan, Ameren
issued 2.2 million, 3.0 million, and 3.2 million shares of
common stock in 2011, 2010, and 2009, respectively,
which were valued at $65 million, $80 million, and
$82 million for the respective years.
In September 2009, Ameren issued and sold
21.85 million shares of its common stock at $25.25 per
share, for proceeds of $535 million, net of $17 million of
issuance costs. Ameren used the offering proceeds to make
investments in its rate-regulated utility subsidiaries in the
form of capital contributions to Ameren Missouri and Ameren
Illinois of $436 million and $99 million, respectively.
The Ameren Companies may sell securities registered
under their effective registration statements if market
conditions and capital requirements warrant such sales.
Any offer and sale will be made only by means of a
prospectus that meets the requirements of the Securities
Act of 1933 and the rules and regulations thereunder.
Indebtedness Provisions and Other Covenants
See Note 4 – Short-Term Debt and Liquidity and Note
5 – Long-term Debt and Equity Financings under Part II,
Item 8, of this report for a discussion of covenants and
provisions (and applicable cross-default provisions)
contained in our bank credit and term loan agreements and
in certain of the Ameren Companies’ indentures and articles
of incorporation.
At December 31, 2011, the Ameren Companies were in
compliance with the provisions and covenants contained
within their credit agreements, indentures, and articles of
incorporation provisions and covenants.
We consider access to short-term and long-term
capital markets a significant source of funding for capital
requirements not satisfied by our operating cash flows.
Inability to raise capital on reasonable terms, particularly
during times of uncertainty in the capital markets, could
negatively affect our ability to maintain and expand our
businesses. After assessing our current operating
performance, liquidity, and credit ratings (see Credit
Ratings below), we believe that Ameren and its rate-
regulated businesses will continue to have access to the
capital markets. However, events beyond our control may
create uncertainty in the capital markets or make access to
the capital markets uncertain or limited. Such events could
increase our cost of capital and adversely affect our ability
to access the capital markets.
Genco’s operating results and operating cash flows are
significantly affected by changes in market prices for power,
which have significantly decreased over the past few years.
Under the provisions of Genco’s indenture described in
Note 5 – Long-term Debt and Equity Financings, in Part II,
Item 8 of this report, Genco may not borrow additional
funds from external, third-party sources if its interest
coverage ratio is less than a specified minimum or its
leverage ratio is greater than a specified maximum. Based
on projections as of December 31, 2011, of Genco’s
operating results and cash flows, we expect that, by the end
of the first quarter of 2013, Genco’s interest coverage ratio
will be less than the minimum ratio required for the
company to borrow additional funds from external, third-
party sources.
Dividends
Ameren paid to its shareholders common stock
dividends totaling $375 million, or $1.555 per share, in
2011, $368 million, or $1.54 per share, in 2010, and
$338 million, or $1.54 per share, in 2009. The payout rate
based on net income in 2011 and 2009 was 72% and 55%,
respectively. The payout of common stock dividends
exceeded net income in 2010 because of the noncash
goodwill, impairment and other charges recorded during
2010. Dividends paid to common shareholders in relation to
net cash provided by operating activities for the same
periods were 20% in 2011, 20% in 2010, and 17% in 2009.
The amount and timing of dividends payable on
Ameren’s common stock are within the sole discretion of
Ameren’s board of directors. The board of directors has not
set specific targets or payout parameters when declaring
common stock dividends. However, as it has done in the
past, the board of directors is expected to consider various
issues, including Ameren’s overall payout ratio, payout
ratios of our peers, projected cash flow and potential future
cash flow requirements, historical earnings and cash flow,
projected earnings, impacts of regulatory orders or
legislation, and other key business considerations. On
February 10, 2012, the board of directors of Ameren
declared a quarterly dividend on Ameren’s common stock
of 40 cents per share, payable on March 30, 2012, to
stockholders of record on March 14, 2012.
Certain of our financial agreements and corporate
organizational documents contain covenants and conditions
that, among other things, restrict the Ameren Companies’
payment of dividends in certain circumstances.
Ameren Illinois’ articles of incorporation require its
dividend payments on common stock to be based on ratios
of common stock to total capitalization and other provisions
related to certain operating expenses and accumulations of
earned surplus.
Genco’s indenture includes restrictions that prohibit it
from making dividend payments on its common stock.
Specifically, Genco cannot pay dividends on its common
stock unless the company’s actual interest coverage ratio
for the most recently ended four fiscal quarters and the
63
interest coverage ratios projected by management for each
of the subsequent four six-month periods are greater than a
specified minimum level. Based on projections as of
December 31, 2011, of Genco’s operating results and cash
flows in 2012 and 2013, we did not believe that Genco will
achieve the minimum interest coverage ratio necessary to
pay dividends on its common stock for the six months
ended June 30, 2013, or the six months ended
December 31, 2013. As a result, Genco was restricted from
paying dividends on its common stock as of December 31,
2011, and we expect Genco will be unable to pay dividends
on its common stock in 2012, 2013, and 2014. See
Note 5 – Long-term Debt and Equity Financings under
Part II, Item 8, of this report for additional information on
Genco’s indenture provisions.
Ameren Missouri, Ameren Illinois and Genco as well as
certain other nonregistrant Ameren subsidiaries are subject
to Section 305(a) of the Federal Power Act, which makes it
unlawful for any officer or director of a public utility, as
defined in the Federal Power Act, to participate in the
making or paying of any dividend from any funds “properly
included in capital account.” The meaning of this limitation
has never been clarified under the Federal Power Act or
FERC regulations. However, FERC has consistently
interpreted the provision to allow dividends to be paid as
long as (1) the source of the dividends is clearly disclosed,
(2) the dividends are not excessive, and (3) there is no self-
dealing on the part of corporate officials. At a minimum,
Ameren believes that dividends can be paid by its
subsidiaries that are public utilities from net income and
retained earnings. In addition, under Illinois law, Ameren
Illinois may not pay any dividend on its stock unless,
among other things, its earnings and earned surplus are
sufficient to declare and pay a dividend after provision is
made for reasonable and proper reserves, or unless Ameren
Illinois has specific authorization from the ICC.
In its application for the FERC orders approving the
Ameren Illinois Merger and the AERG distribution, Ameren
committed itself to maintain a minimum of 30% equity in its
capital structure at Ameren Illinois following the Ameren
Illinois Merger and the AERG distribution.
At December 31, 2011, Ameren, Ameren Missouri and
Ameren Illinois were not restricted from paying dividends.
The following table presents common stock dividends paid by Ameren Corporation to its common stockholders and by
Ameren’s registrant subsidiaries to their respective parents.
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Dividends paid by Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
403
327
-
375
$
235
133
-
368
$
175
98
43
338
2011
2010
2009
Certain of the Ameren Companies have issued
preferred stock, which provides for cumulative preferred
stock dividends. Each company’s board of directors
considers the declaration of the preferred stock dividends to
shareholders of record on a certain date, stating the date on
which the dividend is payable and the amount to be paid.
See Note 5 – Long-term Debt and Equity Financings under
Part II, Item 8, of this report for further detail concerning
the preferred stock issuances.
64
Contractual Obligations
The following table presents our contractual obligations as of December 31, 2011. See Note 11 – Retirement Benefits
under Part II, Item 8, of this report for information regarding expected minimum funding levels for our pension plans. These
expected pension funding amounts are not included in the table below. In addition, routine short-term purchase order
commitments are not included.
Total
Less than
1 Year
1 - 3 Years
3 - 5 Years
After 5
Years
Ameren:(a)
Long-term debt and capital lease obligations(b)(c)
. . . . . . . . . . . . . . . . . . . . . .
Short-term debt
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest payments(d)
Operating leases(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other obligations(f)
$
6,866
148
4,338
307
9,114
$
179
148
446
38
1,972
$
940
-
826
58
2,727
$
515
-
715
51
1,929
$
5,232
-
2,351
160
2,486
Total cash contractual obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
20,773
$
2,783
$
4,551
$
3,210
$
10,229
Ameren Missouri:
Long-term debt and capital lease obligations(c) . . . . . . . . . . . . . . . . . . . . . . . .
Interest payments(d)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating leases(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other obligations(f)
$
$
3,955
2,603
134
5,634
178
229
13
820
$
314
431
24
1,588
$
386
393
24
1,584
Total cash contractual obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
12,326
$
1,240
$
2,357
$
2,387
Ameren Illinois:
Long-term debt(b)(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest payments(d)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating leases(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other obligations(f)
Total cash contractual obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt(c)
Interest payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating leases(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other obligations(f)
$
$
$
$
$
$
1,661
935
7
2,424
5,027
825
710
131
674
Total cash contractual obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
2,340
$
1
120
1
525
647
-
59
11
462
532
$
201
225
2
863
$
1,291
$
$
-
118
22
165
305
$
$
$
$
129
204
2
238
573
-
118
21
47
186
$
$
$
$
$
3,077
1,550
73
1,642
6,342
1,330
386
2
798
2,516
825
415
77
-
$
1,317
Includes amounts for registrant and nonregistrant Ameren subsidiaries and intercompany eliminations.
(a)
(b) Excludes fair-market value adjustments of long-term debt of $5 million for Ameren Illinois.
(c) Excludes unamortized discount and premium of $15 million at Ameren, $5 million at Ameren Missouri, $8 million at Ameren Illinois, and
$1 million at Genco.
(d) The weighted-average variable-rate debt has been calculated using the interest rate as of December 31, 2011.
(e) Amounts related to certain real estate leases and railroad licenses have indefinite payment periods. Ameren’s $2 million annual obligation for
these items is included in the Less than 1 Year, 1 – 3 Years, and 3 – 5 Years columns. The amounts for the indefinite payments are not
included in the After 5 Years column because that period is indefinite.
(f) See Other Obligations within Note 15 – Commitments and Contingencies under Part II, Item 8 of this report, for discussion of items included
herein.
As of December 31, 2011, the amounts of
unrecognized tax benefits under the authoritative
accounting guidance for uncertain tax positions were
$148 million, $124 million, $11 million, and $9 million for
Ameren, Ameren Missouri, Ameren Illinois, and Genco,
respectively. It is reasonably possible to expect that the
settlement of an unrecognized tax benefit will result in an
underpayment or overpayment of tax and related interest.
However, there is a high degree of uncertainty with respect
to the timing of cash payments or receipts associated with
unrecognized tax benefits. The amount and timing of certain
payments or receipts is not reliably estimable or
determinable at this time. See Note 13 – Income Taxes
under Part II, Item 8, of this report for information
regarding the Ameren Companies’ unrecognized tax
benefits and related liabilities for interest expense.
Off-Balance-Sheet Arrangements
At December 31, 2011, none of the Ameren Companies
had off-balance-sheet financing arrangements other than
operating leases entered into in the ordinary course of
business. None of the Ameren Companies expect to engage
in any significant off-balance-sheet financing arrangements
in the near future.
65
Credit Ratings
The credit ratings of the Ameren Companies affect our
liquidity, our access to the capital markets and credit
markets, our cost of borrowing under our credit facilities
and collateral posting requirements under commodity
contracts.
The following table presents the principal credit ratings
of the Ameren Companies by Moody’s, S&P, and Fitch
effective on the date of this report:
Moody’s
S&P
Fitch
Ameren:
Issuer/corporate credit rating . .
Senior unsecured debt
. . . . . . .
Commercial paper . . . . . . . . . . .
Ameren Missouri:
Issuer/corporate credit rating . .
Secured debt . . . . . . . . . . . . . . .
Ameren Illinois:
Issuer/corporate credit rating . .
Secured debt . . . . . . . . . . . . . . .
. . . . . . .
Senior unsecured debt
Genco:
Issuer/corporate credit rating . .
. . . . . . .
Senior unsecured debt
Baa3
Baa3
P-3
Baa2
A3
Baa3
Baa1
Baa3
-
Ba1
BBB-
BB+
A-3
BBB-
BBB+
BBB-
BBB/BBB+(a)
BBB-
BB
BB
BBB
BBB
F2
BBB+
A
BBB-
BBB+
BBB
BB-
BB-
(a) The BBB+ rating applies to issuances of securities secured by the
mortgage associated with the former property of CILCO. The BBB
rating applies to issuances of securities secured by the mortgage
associated with the former property of IP and CIPS.
The cost of borrowing under our credit facilities can
also increase or decrease depending upon the credit ratings
of the borrower. A credit rating is not a recommendation to
buy, sell, or hold securities. It should be evaluated
independently of any other rating. Ratings are subject to
revision or withdrawal at any time by the rating
organization.
Collateral Postings
Any adverse change in the Ameren Companies’ credit
ratings may reduce access to capital and trigger additional
collateral postings and prepayments. Such changes may
also increase the cost of borrowing and fuel, power, and
natural gas supply, among other things, resulting in a
negative impact on earnings. Cash collateral postings and
prepayments made with external parties, including postings
related to exchange-traded contracts at December 31, 2011,
were $145 million, $11 million, $102 million and $1 million
at Ameren, Ameren Missouri, Ameren Illinois and Genco,
respectively. The amount of cash collateral external
counterparties posted with Ameren was $6 million at
December 31, 2011. Sub-investment-grade issuer or senior
unsecured debt ratings (lower than “BBB-” or “Baa3”) at
December 31, 2011, could have resulted in Ameren,
Ameren Missouri, Ameren Illinois or Genco being required
to post additional collateral or other assurances for certain
trade obligations amounting to $332 million, $86 million,
$125 million, and $58 million, respectively.
Changes in commodity prices could trigger additional
collateral postings and prepayments at current credit
ratings. If market prices were 15% higher than
December 31, 2011, levels in the next 12 months and 20%
higher thereafter through the end of the term of the
commodity contracts, then Ameren, Ameren Missouri,
Ameren Illinois and Genco could be required to post
additional collateral or other assurances for certain trade
obligations up to $119 million, $10 million, $- million, and
$19 million, respectively. If market prices were 15% lower
than December 31, 2011, levels in the next 12 months and
20% lower thereafter through the end of the term of the
commodity contracts, then Ameren, Ameren Missouri,
Ameren Illinois and Genco could be required to post
additional collateral or other assurances for certain trade
obligations up to $227 million, $10 million, $69 million, and
$81 million, respectively.
OUTLOOK
Ameren seeks to earn competitive returns on its
investments in its businesses. Ameren Missouri and
Ameren Illinois are seeking to improve their regulatory
frameworks and cost recovery mechanisms. At the same
time, Ameren’s rate-regulated businesses are pursuing
constructive regulatory outcomes within existing
frameworks and are seeking to align their overall spending,
both operating and capital, with economic conditions and
cash flows provided by their regulators. Consequently,
Ameren’s rate-regulated businesses expect to narrow the
historic gap between allowed and earned returns on equity.
Ameren’s Merchant Generation segment maintains a fleet of
competitive coal-fired and natural gas generating assets.
Ameren’s merchant generation strategy is to position itself
as a low-cost provider and to benefit from an expected
future recovery of power prices. Ameren intends to allocate
its capital resources to those business opportunities,
including electric and natural gas transmission, that offer
the most attractive risk-adjusted return potential.
Below are some key trends, events, and uncertainties
that are reasonably likely to affect the Ameren Companies’
financial condition, results of operations, or liquidity as well
as their ability to achieve strategic and financial objectives
for 2012 and beyond.
Rate-Regulated Operations
‰
‰
Ameren’s strategy for earning competitive returns on
its rate-regulated investments involves meeting
customer energy needs in an efficient fashion, working
to enhance regulatory frameworks, making timely and
well-supported rate filings, and aligning overall
spending with those rate case outcomes, economic
conditions and return opportunities.
The IEIMA, enacted late in 2011, provides for a
performance-based formula ratemaking framework for
electric delivery utilities in Illinois. On January 3, 2012,
Ameren Illinois elected to participate in this regulatory
framework by making its initial performance-based
formula rate filing with the ICC. We believe that our
66
‰
‰
‰
participation in this framework will better enable
Ameren Illinois to earn its allowed return on equity for
its electric delivery service business. This is expected to
give Ameren Illinois the earnings predictability to invest
in modernizing its distribution system. During 2012,
Ameren Illinois is required to make a one-time
$7.5 million nonrecoverable donation to the Illinois
Science and Energy Innovation Trust. Additionally,
Ameren Illinois is required to make an annual donation
to that same trust and to fund customer assistance
programs, both of which will total approximately
$2 million, in the aggregate, in 2012.
As they continue to experience cost recovery pressures,
Ameren Missouri and Ameren Illinois expect to
regularly seek electric and natural gas rate increases
and timely cost recovery and tracking mechanisms
from their regulators. These pressures include lower
load growth from a weak economy, customer
conservation efforts, and the impacts of energy
efficiency programs, increased investments and
expected future investments for environmental
compliance, system reliability improvements, and new
baseload capacity, including renewable requirements.
Increased investments also result in higher depreciation
and financing costs. Increased costs are also expected
from rising employee benefit costs, higher property and
income taxes, and higher insurance premiums as a
result of insurance market conditions and loss
experience, among other things. Following
recommendations from the NRC’s task force on
lessons learned from the 2011 reactor accident in
Japan, the NRC is expected to issue orders in 2012
requiring United States nuclear plants to enhance
nuclear plant readiness to safely manage severe events.
Such orders are expected to result in increased costs or
investments.
Ameren’s rate-regulated businesses have procured rate
increases. In January 2012, the ICC issued an order
that authorized a $32 million increase in Ameren
Illinois’ annual natural gas delivery service revenues.
This request was based on a future test year of 2012,
rather than a historical test year, in order to improve
the ability to earn returns allowed by regulators.
In 2011, Ameren Missouri received separate rate
increases for its electric and natural gas businesses. In
January 2011, the MoPSC approved a stipulation and
agreement that authorized an increase in annual natural
gas delivery revenues of $9 million. In July 2011, the
MoPSC issued an order approving an increase in
annual revenues for electric service of $173 million.
Depreciation for the Sioux scrubbers, previously
deferred as a regulatory asset when placed in service in
November 2010, will result in an increase in annual
expense of $21 million, beginning in August 2011. In
addition, capitalization of interest was discontinued in
July 2011. The MoPSC also issued an order, in April
2011, with respect to its review of Ameren Missouri’s
FAC for the period from March 1, 2009, to
September 30, 2009. The order required Ameren
Missouri to refund $18 million, including $1 million for
‰
‰
‰
‰
‰
67
interest, to customers related to earnings associated
with certain long-term partial requirements sales that
were made by Ameren Missouri due to the loss of
Noranda’s load caused by a severe ice storm in January
2009. Ameren Missouri has appealed this decision to
the Cole County Circuit Court. The MoPSC is currently
conducting its FAC review for periods after September
2009. It is possible that the MoPSC could order
additional refunds of $25 million related to periods after
September 2009, and this could result in a charge to
earnings. Ameren Missouri filed a request with the
MoPSC in July 2011 for an accounting authority order
that would allow Ameren Missouri to recover fixed
costs totaling $36 million that were not recovered as a
result of the loss of load caused by the severe 2009 ice
storm for potential recovery in a future electric rate
case.
In January 2012, Ameren Missouri made its initial filing
under the MEEIA. The MEEIA requires the MoPSC to
ensure that a utility’s financial incentives are aligned
with helping customers use energy more efficiently, to
provide timely cost recovery, and to provide earnings
opportunities associated with cost-effective energy
efficiency programs. Ameren Missouri’s filing proposes
a three-year plan that includes a portfolio of energy
efficiency programs along with a cost-recovery
mechanism. If the proposal is approved, beginning in
January 2013, Ameren Missouri plans to invest
$145 million over three years in the proposed energy
efficiency programs. Ameren Missouri’s second filing,
made in February 2012, was a request to increase its
annual revenues for electric service by $376 million,
which includes recovery of the cost of the proposed
energy efficiency programs included in the MEEIA
filing. A MoPSC decision in Ameren Missouri’s MEEIA
filing is anticipated in the second quarter of 2012, while
an electric rate order is expected in December 2012.
Ameren and Ameren Missouri also are pursuing
recovery from insurers, through litigation, for
reimbursement of unpaid liability insurance claims for a
December 2005 breach of the upper reservoir at
Ameren Missouri’s Taum Sauk pumped-storage
hydroelectric energy center.
Approximately 340 employees of Ameren Missouri and
Ameren Services accepted voluntary separation offers
and left the company as of December 31, 2011. As a
result of the voluntary separations, Ameren and
Ameren Missouri estimate an annual $20 million
reduction in operations and maintenance expense
beginning in 2012.
Ameren Missouri’s Callaway energy center completed a
scheduled refueling and maintenance outage during the
fourth quarter of 2011. Ameren Missouri’s next
scheduled refueling and maintenance outage is in the
spring of 2013. During a scheduled outage, which
occurs every 18 months, maintenance and purchased
power costs increase, and the amount of excess power
available for sale decreases, versus non-outage years.
Ameren intends to allocate its capital to those
investment opportunities with the highest expected
risk-adjusted returns. Ameren believes that because of
its strategic location in the country, electric
transmission may provide it with such an opportunity.
In December 2011, MISO approved three projects,
which will be developed by ATXI or ATX. The first
project, Illinois Rivers, involves building a 345-kilovolt
line across the state of Illinois, from the Missouri
border to the Indiana border. Work on the first sections
of this project will begin in 2012; the expected
in-service date is 2016. The last section of this project
is expected to be completed in 2019. The Spoon River
project in northwest Illinois and the Mark Twain project
in northeast Missouri are the other two projects
approved by MISO in its current transmission
expansion plan. These two projects are expected to be
completed in 2018. The estimated total investment in
these three projects is expected to be more than
$1.2 billion. FERC, in its order issued in May 2011,
approved transmission rate incentives for the Illinois
Rivers project as well as for the Big Muddy project. The
Big Muddy project, located primarily in southern
Illinois, is currently being evaluated for inclusion in
MISO’s 2012 transmission expansion plan.
During January 2012, the weather conditions in
Ameren Missouri’s and Ameren Illinois’ service
territories were unseasonably warm. Heating degree-
days in Ameren’s rate-regulated service territories were
14% lower than normal winter weather conditions and
25% lower than weather conditions that occurred
during January 2011.
For additional information regarding recent rate orders
and related appeals, pending requests filed with state
and federal regulatory commissions, the FAC prudence
review and related appeal, and Taum Sauk matters, see
Note 1 – Summary of Significant Accounting Policies,
Note 2 – Rate and Regulatory Matters, and Note 15 –
Commitments and Contingencies under Part II, Item 8,
of this report.
‰
‰
Merchant Generation Operations
‰
In this period of generally weak power prices, Ameren
is focused on improving and reducing the volatility of,
operating cash flows within its Merchant Generation
business so that cash flows from operations
approximate required investments. Merchant
Generation has reduced operating costs and sought
cost-efficient methods to comply with significant
environmental requirements. Merchant Generation
expects to continue to pursue these strategies while
positioning themselves for an expected future recovery
in power prices and margins. As part of this strategy
Genco closed its Meredosia and Hutsonville energy
centers at the end of 2011, primarily because
environmental investments expected to be required
were not economical. The closures and the retention of
these energy centers’ emission allowances create
flexibility to lower compliance costs at other Merchant
Generation energy centers. In addition, the closure of
the Hutsonville and Meredosia energy centers is not
‰
‰
68
expected to have a material impact on Ameren’s or
Genco’s future earnings. In 2011, nearly all of Merchant
Generation’s margin was generated from sales of output
from five baseload energy centers (Newton, Joppa,
Coffeen, E.D. Edwards, and Duck Creek). The Merchant
Generation segment expects to have available generation
from its coal-fired energy centers of 32.5 million
megawatthours in 2012. However, based on currently
expected power prices, the Merchant Generation
segment expects to generate approximately 27 million
(Genco – 20 million) megawatthours of power in 2012.
See Note 15 – Commitments and Contingencies under
Part II, Item 8, of this report for further discussion of
environmental matters and compliance plans.
Power prices in the Midwest affect the amount of
revenues and cash flows Merchant Generation and
Genco can generate by marketing power into the
wholesale and retail markets. Market prices for power
have decreased over the past three years. During 2012,
the market price for power for delivery in the current year
has declined below 2011 levels because of factors such
as declining natural gas prices and the stay of the
CSAPR. From December 31, 2011, through January 31,
2012, the market price for power at the Indiana Hub
decreased by 12%. Ameren’s Merchant Generation
segment and Genco will be adversely impacted by the
declining market price of power for any unhedged
generation. Merchant Generation and Genco are
currently evaluating this recent price decline and the
impact of the stay of the CSAPR, and the potential
impact these events may have on their operating and
capital investment plans. In 2012, Genco decelerated the
construction of two scrubbers at its Newton energy
center, and AERG removed from its five-year capital
expenditures forecast previously planned precipitator
upgrades at its E.D. Edwards energy center. Based on
current environmental rules and regulations, if Merchant
Generation and Genco do not complete these
environmental upgrades by the beginning of 2015,
Merchant Generation and Genco may need to reduce
generation output at their energy centers to reduce
emissions. Merchant Generation and Genco will also
evaluate whether the decline in the market price for
power in the first quarter of 2012, and any changes to
operating and capital plans, is indicative that the carrying
value of its energy centers may not be recoverable. A
failure to achieve forecasted operating results and cash
flows, an unfavorable change in forecasted operating
results and cash flows, or a reduction in the expected
useful lives of Merchant Generation’s energy centers
could result in the recognition of long-lived asset
impairment charges. Merchant Generation’s energy
centers without pollution control equipment are most
exposed to declining power prices as compliance options
for environmental laws and regulations could become
prohibitively expensive.
To reduce cash flow volatility, Marketing Company,
through a mix of physical and financial sales contracts,
targets to hedge Merchant Generation’s expected
output by 80% to 90% for the following year, 50% to
70% for two years out, and 30% to 50% for three years
out. As of January 31, 2012, Marketing Company had
hedged approximately 25 million megawatthours of
Merchant Generation’s expected generation for 2012, at
an average price of $44 per megawatthour. For 2013,
Marketing Company had hedged approximately
14 million megawatthours of Merchant Generation’s
forecasted generation sales at an average price of $40
per megawatthour. For 2014, Marketing Company had
hedged approximately 7 million megawatthours of
Merchant Generation’s forecasted generation sales at
an average price of $44 per megawatthour. Any
unhedged forecasted generation will be exposed to
market prices at the time of sale. As a result, any new
physical or financial power sales may be at price levels
lower than previously experienced and lower than the
value of existing hedged sales.
‰
‰ Merchant Generation is also supporting development of
an energy capacity market within MISO, which is
expected to support longer-term investment. FERC is
expected to issue an order on MISO’s proposal to
establish a capacity market within the RTO. The MISO
proposal calls for the first annual capacity auction to be
held in April 2013 for the June 2013 to May 2014
planning year.
To further reduce cash flow volatility, Merchant
Generation seeks to hedge fuel costs consistent with
power sales. As of January 31, 2012, for 2012
Merchant Generation had hedged fuel costs for
approximately 25 million megawatthours of coal and up
to 28 million megawatthours of base transportation at
about $24 per megawatthour. For 2013, Merchant
Generation had hedged fuel costs for approximately
12 million megawatthours of coal and up to 27 million
megawatthours of base transportation at about $25.50
per megawatthour. For 2014, Merchant Generation had
hedged fuel costs for approximately 5 million
megawatthours of coal and up to 21 million
megawatthours of base transportation at about $25.50
per megawatthour. In 2012, Genco and the Merchant
Generation segment are targeting a reduction in coal
inventories. See Item 7A – Quantitative and Qualitative
Disclosures About Market Risk of this report for
additional information about the percentage of fuel and
transportation requirements that are price-hedged for
2012 through 2016.
Liquidity and Capital Resources
‰
‰
The Ameren Companies seek to maintain access to the
capital markets at commercially attractive rates in order
to fund their businesses. The enhancement of
regulatory frameworks and returns is expected to
improve cash flows, credit metrics, and related access
to capital for Ameren’s rate-regulated businesses.
Genco and the Merchant Generation segment seek to
fund their operations internally and therefore seek not
to rely on financing from Ameren or external, third-
party sources. Genco and the Merchant Generation
segment will continue to seek to defer capital and
operating expenses, sell certain assets, and take other
actions as necessary to fund their operations internally
while maintaining safe and reliable operations. Under its
indenture, Genco may not borrow additional funds from
external, third-party sources if its interest coverage ratio
is less than a specified minimum or its leverage ratio is
greater than a specified maximum. Based on projections
as of December 31, 2011, of Genco’s operating results
and cash flows, we expect that, by the end of the first
quarter of 2013, Genco’s interest coverage ratio will be
less than the minimum ratio required for the company to
borrow additional funds from external, third-party
sources. Genco’s indenture does not restrict
intercompany borrowings from Ameren’s non-state-
regulated subsidiary money pool. However, borrowings
from the money pool are subject to Ameren’s control,
and if a Genco intercompany financing need were to
arise, borrowings from the non-state-regulated
subsidiary money pool by Genco would be dependent on
consideration by Ameren of the facts and circumstances
existing at that time.
The Ameren Companies have also entered into multiyear
credit facility agreements that cumulatively provide
$2.1 billion of credit through September 10, 2013. We
believe that our liquidity is adequate given our expected
operating cash flows, capital expenditures, and related
financing plans. However, there can be no assurance that
significant changes in economic conditions, disruptions
in the capital and credit markets, or other unforeseen
events will not materially affect our ability to execute our
expected operating, capital or financing plans.
In September 2012, $173 million of Ameren Missouri’s
5.25% senior secured notes mature.
As of December 31, 2011, Ameren had approximately
$390 million in federal income tax net operating loss
carryforwards (Ameren Missouri – $140 million, Ameren
Illinois – $90 million, Genco – $20 million) and
$72 million in federal income tax credit carryforwards
(Ameren Missouri – $11 million, Ameren Illinois –
$- million, Genco – $1 million). These carryforwards are
expected to satisfy income tax liabilities through the end
of 2013 (Ameren Missouri – 2012, Ameren Illinois –
2012, Genco – 2013).
Between 2012 and 2021, Ameren currently expects to
invest between $1.8 billion to $2.2 billion to retrofit its
coal-fired energy centers with pollution control
equipment in compliance with environmental laws and
regulations. Any pollution control investments will result
in decreased energy center availability during
construction and significantly higher ongoing operating
expenses. Any pollution control investments at Ameren
Missouri are expected to be recoverable from ratepayers,
subject to prudence reviews. Regulatory lag may
materially affect the timing of such recovery and returns
on the investments, and therefore affect our cash flows
and related financing needs. The recoverability of
amounts expended in our Merchant Generation segment
will depend on whether market prices for power adjust
as a result of market conditions reflecting increased
environmental costs for coal-fired generators.
‰
‰
‰
‰
69
‰
‰
In October 2011, Ameren’s board of directors declared
a fourth quarter dividend of 40 cents per common
share, a 3.9% increase from the prior quarterly
dividend of 38.5 cents per share, resulting in an
annualized equivalent dividend of $1.60 per share.
Based on the shares outstanding at the end of October
2011, on an annual basis, the dividend increase will
result in additional dividends of $15 million.
In February 2012, Ameren completed the asset sale of
its Medina Valley energy center’s net property and plant
‰
for cash proceeds of $16 million. The loss of margin
contributed by Medina Valley is not expected to
materially impact Ameren’s 2012 results of operations.
Ameren and Genco are currently exploring
opportunities to make the Meredosia energy center
available for those parties interested in repowering one
of its units to create an oxy-fuel combustion coal-fired
energy center designed for permanent CO2 capture and
storage.
REGULATORY MATTERS
See Note 2 – Rate and Regulatory Matters under Part II, Item 8, of this report.
ACCOUNTING MATTERS
Critical Accounting Estimates
Preparation of the financial statements and related disclosures in compliance with GAAP requires the application of
appropriate technical accounting rules and guidance, as well as the use of estimates. These estimates involve judgments
regarding many factors which in and of themselves could materially affect the financial statements and disclosures. We have
outlined below the critical accounting estimates that we believe are most difficult, subjective, or complex. Any change in the
assumptions or judgments applied in determining the following matters, among others, could have a material impact on future
financial results.
Accounting Estimate
Uncertainties Affecting Application
Regulatory Mechanisms and Cost Recovery
Ameren, Ameren Missouri and Ameren Illinois defer costs
in accordance with authoritative accounting guidance, and
make investments that they assume will be collected in
future rates.
‰
‰
‰
‰
Regulatory environment and external regulatory
decisions and requirements
Anticipated future regulatory decisions and their impact
Impact of deregulation, rate freezes, prudency reviews,
and competition on ratemaking process and ability to
recover costs
Beginning in 2012, Ameren Illinois’ assessment of and
ability to estimate the current year’s electric delivery
service costs to be reflected in revenues and recovered
from customers in a subsequent year under the IEIMA
performance-based formula ratemaking process
Basis for Judgment
We determine which costs are recoverable by consulting previous rulings by state regulatory authorities in jurisdictions
where we operate and any other factors that may indicate whether cost recovery is probable. If facts and circumstances lead
us to conclude that a recorded regulatory asset is no longer probable of recovery or that plant assets are probable of
disallowance, we record a charge to earnings, which could be material. See Note 2 – Rate and Regulatory Matters under Part
II, Item 8, of this report for quantification of these assets for each of the Ameren Companies, excluding Genco.
Unbilled Revenue
At the end of each period, Ameren, Ameren Missouri and
Ameren Illinois project expected usage and estimate the
amount of revenue to record for services that have been
provided to customers but not yet billed.
‰
‰
‰
Projecting customer energy usage
Estimating impacts of weather and other usage-
affecting factors for the unbilled period
Estimating loss of energy during transmission and
delivery
Basis for Judgment
We base our estimate of unbilled revenue each period on the volume of energy delivered, as valued by a model of billing
cycles and historical usage rates and growth by customer class for our service area. This figure is then adjusted for the
modeled impact of seasonal and weather variations based on historical results. See the balance sheets for each of the
Ameren Companies, excluding Genco, under Part II, Item 8, of this report for unbilled revenue amounts.
70
Accounting Estimate
Derivative Financial Instruments
We account for derivative financial instruments and
measure their fair value in accordance with authoritative
accounting guidance. The identification and classification
of a derivative and the fair value of such derivative must
be determined. See Commodity Price Risk and Fair Value
of Contracts in Quantitative and Qualitative Disclosures
About Market Risk under Part II, Item 7A, Note 7 –
Derivative Financial Instruments and Note 8 – Fair Value
Measurements under Part II, Item 8, of this report.
Uncertainties Affecting Application
‰
‰
‰
Our ability to identify derivatives
Our ability to assess whether derivative contracts
qualify for the NPNS exception
Our ability to consume or produce notional values of
derivative contracts
‰ Market conditions in the energy industry, especially the
effects of price volatility and liquidity
Valuation assumptions on longer term contracts due to
lack of observable inputs
Effectiveness of derivatives that have been designated
as hedges
Counterparty default risk
‰
‰
‰
Basis for Judgment
We evaluate contracts to determine whether they contain derivatives. Determining whether or not a contract qualifies as a
derivative under authoritative accounting guidance requires us to exercise significant judgment in interpreting the definition
of a derivative and applying that definition. Authoritative accounting guidance regarding derivative instruments requires that
all contracts considered to be derivative instruments be recorded on the balance sheet at their fair values, unless the NPNS
exception applies. We determine whether to exclude the fair value of certain derivatives from valuation under the NPNS
provisions of authoritative accounting guidance after assessing our intent and ability to physically deliver commodities
purchased and sold. Further, our forecasted purchases and sales also support our designation of some fair valued derivative
instruments as cash flow hedges. Fair value of our derivatives is measured in accordance with authoritative accounting
guidance, which provides a fair value hierarchy that prioritizes inputs to valuation techniques. We use valuation techniques
that maximize the use of observable inputs and minimize the use of unobservable inputs. When we do not have observable
inputs, we use certain assumptions that market participants would use in pricing the asset or liability, including assumptions
about risks inherent in the inputs to the valuation. Our valuations also reflect our own assessment of counterparty default
risk, guided by the best internal and external information available. If we were required to discontinue our use of the NPNS
exception or cash flow hedge treatment for some of our contracts, the impact of changes in fair value for the applicable
contracts could be material to our earnings and financial position.
Valuation of Long-Lived Assets and Asset Retirement Obligations
We periodically assess the carrying value of our long-lived
assets to determine whether they are impaired. We also
review for the existence of asset retirement obligations. If
an asset retirement obligation is identified, we determine
its fair value and subsequently reassess and adjust the
obligation, as necessary.
‰
‰
‰
‰ Management’s identification of impairment indicators
‰
Changes in business, industry, laws, technology, or
economic and market conditions
Valuation assumptions and conclusions
Our assessment of market participants
Estimated useful lives of our significant long-lived
assets
Actions or assessments by our regulators
Identification of an asset retirement obligation and
assumptions about the timing of asset removals
‰
‰
Basis for Judgment
Whenever events or changes in circumstances indicate a valuation may have changed, we use various methodologies that we
believe market participants would use to determine valuations and discounted, undiscounted, and probabilistic discounted
cash flow models with multiple operating scenarios. The identification of asset retirement obligations is conducted through
the review of legal documents and interviews. See Note 1 – Summary of Significant Accounting Policies under Part II, Item 8,
of this report for quantification of our asset retirement obligations. See Note 17 Goodwill, Impairment and Other Charges
under Part II, Item 8, of this report for additional information of our long-lived asset impairment evaluation and charges
recorded.
71
Accounting Estimate
Benefit Plan Accounting
Based on actuarial calculations, we accrue costs of
providing future employee benefits in accordance with
authoritative accounting guidance regarding benefit plans.
See Note 11 – Retirement Benefits under Part II, Item 8,
of this report.
Uncertainties Affecting Application
‰
‰
‰
‰
‰
‰
‰
Future rate of return on pension and other plan assets
Interest rates used in valuing benefit obligations
Health care cost trend rates
Timing of employee retirements and mortality
assumptions
Ability to recover certain benefit plan costs from our
ratepayers
Changing market conditions that may affect investment
and interest rate environments
Impacts of the health care reform legislation enacted in
2010
Basis for Judgment
Our ultimate selection of the discount rate, health care trend rate, and expected rate of return on pension and other
postretirement benefit plan assets is based on our consistent application of assumption-setting methodologies and our
review of available historical, current, and projected rates, as applicable. See Note 11 – Retirement Benefits under Part II,
Item 8, of this report for sensitivity of Ameren’s benefit plans to potential changes in these assumptions.
Accounting for Contingencies
We make judgments and estimates in recording liabilities
for claims, litigation, environmental remediation, the
actions of various regulatory agencies, or other matters
that occur in the normal course of business. We record a
loss contingency when it is probable that a liability has
been incurred and the amount of the loss can be
reasonably estimated. A gain contingency is not recorded
until realized or realizable.
‰
‰
‰
‰
Estimating financial impact of events
Estimating likelihood of outcomes
Regulatory and political environments and
requirements
Outcome of legal proceedings, settlements or other
factors
Basis for Judgment
The determination of a loss contingency requires significant judgment as to the expected outcome of each contingency in
future periods. In making the determination as to the amount of potential loss and the probability of loss, we consider all
available evidence including the expected outcome of potential litigation. If no estimate is better than another within our
range of estimates, we record our best estimate of a loss or the minimum value of our estimated range of outcomes. As
additional information becomes available, we reassess the potential liability related to the contingency and revise our
estimates. In our evaluation of legal matters, management consults with legal counsel and relies on analysis of relevant case
law and legal precedents. See Note 2 – Rate and Regulatory Matters, Note 10 – Callaway Energy Center, and Note 15 –
Commitments and Contingencies under Part II, Item 8, of this report for information on the Ameren Companies’
contingencies.
Impact of Future Accounting Pronouncements
See Note 1 – Summary of Significant Accounting Policies under Part II, Item 8, of this report.
EFFECTS OF INFLATION AND CHANGING PRICES
Ameren’s rates for retail electric and natural gas utility
service are regulated by the MoPSC and the ICC. Nonretail
electric rates are regulated by FERC. Rate regulation is
generally based on the recovery of historical or projected
costs. As a result, revenue increases could lag behind
changing prices. Ameren Illinois has recently elected to
participate in the performance-based formula ratemaking
process for determining retail rates for its electric delivery
service business established by the IEIMA. Ameren Illinois’
participation in this formula ratemaking process will
terminate if the average residential rate increases by more
than 2.5% annually from June 2011 through May 2014. The
average residential rate includes generation service, which
is outside of Ameren Illinois’ control as it is required to
purchase all of its power through procurement processes
administered by the IPA. The cost of procured power can be
affected by inflation. Within that formula, the monthly
average yields of 30-year United States Treasury bonds are
the basis for Ameren Illinois’ return on equity. Therefore,
pending ICC approval of Ameren Illinois’ initial filing under
the IEIMA, which is expected to occur in October 2012,
there will be a direct correlation between the yield of United
States Treasury bonds, which are affected by inflation, and
the earnings of Ameren Illinois’ electric distribution
business. Inflation affects our operations, earnings,
stockholders’ equity, and financial performance.
72
The current replacement cost of our utility plant
substantially exceeds our recorded historical cost. Under
existing regulatory practice, only the historical cost of plant
is recoverable from customers. As a result, cash flows
designed to provide recovery of historical costs through
depreciation might not be adequate to replace the plant in
future years. Ameren’s Merchant Generation business does
not have regulated recovery mechanisms and is therefore
dependent on market prices for power to reflect rising
costs.
Ameren Missouri recovers the cost of fuel for electric
generation and the cost of purchased power by adjusting
rates as allowed through the FAC. Ameren Illinois recovers
power supply costs from electric customers by adjusting
rates through a rider mechanism to accommodate changes
in power prices.
Ameren Missouri and Ameren Illinois are affected by
changes in the cost of electric transmission services. FERC
regulates the rates charged and the terms and conditions
for electric transmission services. Each RTO separately files
regional transmission tariff rates for approval by FERC. All
members within that RTO are then subjected to those rates.
Because they are members of MISO, Ameren Missouri’s
and Ameren Illinois’ transmission rates are calculated in
accordance with MISO’s rate formula. The transmission
rate, updated in June of each year, is based on FERC filings
for the previous year. This rate is charged directly to
wholesale customers. Ameren Illinois also charges this rate
directly to alternative retail electric suppliers. For Illinois’
retail customers who have not chosen an alternative retail
electric supplier, the transmission rate is collected through
a rider mechanism. This rate is not directly charged to
Missouri retail customers because the MoPSC includes
transmission-related costs in setting bundled retail rates in
Missouri.
In our Missouri and Illinois retail natural gas utility
jurisdictions, changes in gas costs are generally reflected in
billings to gas customers through PGA clauses.
Ameren, Ameren Missouri and Genco are affected by
changes in market prices for natural gas to the extent that
they must purchase natural gas to run CTs. These
companies have structured various supply agreements to
maintain access to multiple natural gas pools and supply
basins, and to minimize the impact to their financial
statements. Ameren Missouri’s exposure to changes in
market prices of natural gas is mitigated by its ability to
recover increasing costs via a FAC. See Quantitative and
Qualitative Disclosures About Market Risk – Commodity
Price Risk under Part II, Item 7A, below for additional
information.
See Note 2 – Rate and Regulatory Matters under
Part II, Item 8, of this report for additional information on
the cost recovery mechanisms.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Market risk is the risk of changes in value of a physical
asset or a financial instrument, derivative or nonderivative,
caused by fluctuations in market variables such as interest
rates, commodity prices, and equity security prices. A
derivative is a contract whose value is dependent on, or
derived from, the value of some underlying asset or index.
The following discussion of our risk management activities
includes forward-looking statements that involve risks and
uncertainties. Actual results could differ materially from
those projected in the forward-looking statements. We
handle market risks in accordance with established policies,
which may include entering into various derivative
transactions. In the normal course of business, we also face
risks that are either nonfinancial or nonquantifiable. Such
risks, principally business, legal, and operational risks, are
not part of the following discussion.
Our risk management objective is to optimize our
physical generating assets and to pursue market
opportunities within prudent risk parameters. Our risk
management policies are set by a risk management steering
committee, which is composed of senior-level Ameren
officers.
Interest Rate Risk
We are exposed to market risk through changes in
interest rates associated with:
‰
long-term and short-term variable-rate debt;
‰
‰
‰
fixed-rate debt;
auction-rate long-term debt; and
defined pension and postretirement benefit plans.
We manage our interest rate exposure by controlling
the amount of debt instruments we have within our total
capitalization portfolio and by monitoring the effects of
market changes in interest rates. For defined pension and
postretirement benefit plans, we control the duration and
the portfolio mix of our plan assets.
The following table presents the estimated increase in
our annual interest expense and decrease in net income if
interest rates were to increase by 1% on variable-rate debt
outstanding at December 31, 2011:
Interest Expense
Net Income(a)
. . . . . . . . . . . . . . . .
Ameren(b)
Ameren Missouri
. . . . . . . . . .
Ameren Illinois . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . .
$
4
2
(c)
–
$
(2)
(1)
(c)
–
(a) Calculations are based on an estimated tax rate of 40%, 38%,
41% and 41% for Ameren, Ameren Missouri, Ameren Illinois and
Genco, respectively.
Includes intercompany eliminations.
(b)
(c) Less than $1 million.
The estimated changes above do not consider the
potential reduced overall economic activity that would exist
73
in such an environment. In the event of a significant change
in interest rates, management would probably act to
mitigate further exposure to this market risk. However, due
to the uncertainty of the specific actions that might be taken
and their possible effects, this sensitivity analysis assumes
no change in our financial structure.
Credit Risk
Credit risk represents the loss that would be
recognized if counterparties fail to perform as contracted.
Exchange-traded contracts are supported by the financial
and credit quality of the clearing members of the respective
exchanges and have nominal credit risk. In all other
transactions, we are exposed to credit risk in the event of
nonperformance by the counterparties to the transaction.
See Note 7 – Derivative Financial Instruments under Part II,
Item 8, of this report for information on the potential loss
on counterparty exposure as of December 31, 2011.
Our rate-regulated revenues are primarily derived from
sales or delivery of electricity and natural gas to customers
in Missouri and Illinois. Our physical and financial
instruments are subject to credit risk consisting of trade
accounts receivables and executory contracts with market
risk exposures. The risk associated with trade receivables is
mitigated by the large number of customers in a broad
range of industry groups who make up our customer base.
At December 31, 2011, no nonaffiliated customer
represented more than 10%, in the aggregate, of our
accounts receivable at Ameren Illinois. Noranda, Ameren
Missouri’s largest nonaffiliated electric customer, has
appealed certain aspects of the 2009 and 2010 rate orders
issued by the MoPSC. Noranda has paid into court
registries amounts that represent more than 10%, in the
aggregate, of Ameren Missouri’s accounts receivable at
December 31, 2011. In November 2011, the Missouri Court
of Appeals issued a ruling that upheld the MoPSC’s January
2009 electric rate order. Therefore, Ameren Missouri
expects to receive all of the funds held in the Stoddard
County Circuit Court’s registry relating to the 2009 rate
order, which totaled $20 million as of December 31, 2011,
during the first quarter of 2012. The funds related to the
2010 appeal will remain in the Cole County Circuit Court’s
registry pending resolution, which is expected in 2012. See
Note 2 – Rate and Regulatory Matters under Part II, Item 8,
of this report for additional information. The risk associated
with Ameren Illinois’ electric and natural gas trade
receivables is also mitigated by a rate adjustment
mechanism that allows Ameren Illinois to recover the
difference between its actual bad debt expense under GAAP
and the bad debt expense included in its base rates. Ameren
Missouri and Ameren Illinois continue to monitor the
impact of increasing rates on customer collections. Ameren
Missouri and Ameren Illinois make adjustments to their
allowance for doubtful accounts as deemed necessary to
ensure that such allowances are adequate to cover
estimated uncollectible customer account balances.
Ameren, Ameren Missouri, Ameren Illinois and Genco
may have credit exposure associated with off-system or
wholesale purchase and sale activity with nonaffiliated
companies. At December 31, 2011, Ameren’s, Ameren
Missouri’s, Ameren Illinois’ and Genco’s combined credit
exposure to nonaffiliated trading counterparties, excluding
coal suppliers, deemed below investment grade either
through external or internal credit evaluations, was
$48 million, net of collateral (2010 – $204 million). Almost
all of the $48 million exposure relates to Ameren Illinois’
long-term purchase power and renewable energy credit
contracts. These contracts were procured through the IPA
and are passed through directly to Ameren Illinois
customers. At December 31, 2011, the combined credit
exposures to nonaffiliated coal suppliers, deemed below
investment grade either through external or internal credit
evaluations, net of collateral, were $35 million, $33 million
and $2 million at Ameren, Ameren Missouri and Genco,
respectively. (2010- $ 19 million, $8 million, $10 million,
respectively).
We establish credit limits for these counterparties and
monitor the appropriateness of these limits on an ongoing
basis through a credit risk management program.
Monitoring involves daily exposure reporting to senior
management, master trading and netting agreements, and
credit support, such as letters of credit and parental
guarantees. We also analyze each counterparty’s financial
condition before we enter into sales, forwards, swaps,
futures, or option contracts. We estimate our credit
exposure to MISO associated with the MISO Energy and
Operating Reserves Market to be $29 million at
December 31, 2011 (2010 – $53 million).
Equity Price Risk
Our costs for providing defined benefit retirement and
postretirement benefit plans are dependent upon a number
of factors, including the rate of return on plan assets.
Ameren manages plan assets in accordance with the
“prudent investor” guidelines contained in ERISA. Ameren’s
goal is to ensure that sufficient funds are available to
provide the benefits at the time they are payable while also
to maximizing total return on plan assets and minimizing
expense volatility consistent with its tolerance for risk.
Ameren delegates investment management to specialists.
Where appropriate, Ameren provides the investment
manager with guidelines that specify allowable and
prohibited investment types. Ameren regularly monitors
manager performance and compliance with investment
guidelines.
The expected return on plan assets is based on
historical and projected rates of return for current and
planned asset classes in the investment portfolio. Projected
rates of return for each asset class were estimated after an
analysis of historical experience, future expectations, and
the volatility of the various asset classes. After considering
the target asset allocation for each asset class, we adjusted
the overall expected rate of return for the portfolio for
historical and expected experience of active portfolio
management results compared with benchmark returns,
and for the effect of expenses paid from plan assets.
74
In future years, the costs of such plans will be reflected
The following table shows how our earnings might
in net income, OCI, or regulatory assets. Contributions to
the plans could increase materially, if we do not achieve
pension and postretirement asset portfolio investment
returns equal to or in excess of our 2012 assumed return
on plan assets of 7.75% and 7.50%, respectively.
Ameren Missouri also maintains a trust fund, as
required by the NRC and Missouri law, to fund certain costs
of nuclear plant decommissioning. As of December 31,
2011, this fund was invested primarily in domestic equity
securities (66%) and debt securities (34%). It totaled
$357 million (2010 – $337 million). By maintaining a
portfolio that includes long-term equity investments,
Ameren Missouri seeks to maximize the returns to be used
to fund nuclear decommissioning costs within acceptable
parameters of risk. However, the equity securities included
in the portfolio are exposed to price fluctuations in equity
markets. The debt securities are exposed to changes in
interest rates. Ameren Missouri actively monitors the
portfolio by benchmarking the performance of its
investments against certain indices and by maintaining and
periodically reviewing established target allocation
percentages of the assets of the trust to various investment
options. Ameren Missouri’s exposure to equity price market
risk is in large part mitigated, because Ameren Missouri is
currently allowed to recover its decommissioning costs,
which would include unfavorable investment results,
through electric rates.
Additionally, Ameren has company-owned life
insurance contracts that are used to support Ameren’s
deferred compensation plans. These life insurance contracts
include equity and debt investments that are exposed to
price fluctuations in equity markets and to changes in
interest rates.
Commodity Price Risk
We are exposed to changes in market prices for power,
emission allowances, coal, transportation diesel, natural gas
and uranium.
Ameren’s, Ameren Missouri’s and Genco’s risks of
changes in prices for power sales are partially hedged
through sales agreements. Merchant Generation also seeks
to sell power forward to wholesale, municipal, and
industrial customers to limit exposure to changing prices.
We also attempt to mitigate financial risks through risk
management programs and policies, which include
forward-hedging programs, and through the use of
derivative financial instruments (primarily forward
contracts, futures contracts, option contracts, and financial
swap contracts). However, a portion of the generation
capacity of Ameren, Ameren Missouri and Genco is not
contracted through physical or financial hedge
arrangements and is therefore exposed to volatility in
market prices.
decrease if power prices were to decrease by 1% on
unhedged economic generation for 2012 through 2015:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren(b)
Ameren Missouri
. . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net Income(a)
$
(13)
(c)
(11)
(a) Calculations are based on an estimated tax rate of 40%, 38% and
41% for Ameren, Ameren Missouri and Genco, respectively.
Includes amounts for Ameren registrant and nonregistrant
subsidiaries and intercompany eliminations.
(b)
(c) Less than $1 million.
Ameren’s forward-hedging power programs include
the use of derivative financial swap contracts. These swap
contracts financially settle a fixed price against a floating
price. The floating price is typically the realized, or settled,
price at a liquid regional hub at some forward period of
time. Ameren controls the use of derivative financial swap
contracts with volumetric and correlation limits that are
intended to mitigate any material adverse financial impact.
Historically, Ameren has used swaps that settled against the
Cinergy Hub MISO locational marginal pricing. This hub had
traditionally been the most liquid location, with a strong
correlation to the pricing that was realized at our generating
locations. As of December 31, 2011, MISO stopped
publishing Cinergy Hub pricing. As a result, Ameren will
now use the Indiana Hub and other hubs as necessary for
financial hedging. Ameren does not expect any material
adverse financial impact to the outcomes of its forward-
hedging programs as a result of this change. Ameren will
continue to pursue the best available options to fix pricing
for the output of its generating units.
Ameren also uses its portfolio management and
trading capabilities both to manage risk and to deploy risk
capital to generate additional returns. Due to our physical
presence in the market, we are able to identify and pursue
opportunities, which can generate additional returns
through portfolio management and trading activities. All of
this activity is performed within a controlled risk
management process. We establish value at risk (VaR) and
stop-loss limits that are intended to prevent any material
negative financial impact.
We manage risks associated with changing prices of
fuel for generation with techniques similar to those we use
to manage risks associated with changing market prices for
electricity.
Merchant Generation does not have the ability to pass
higher fuel costs through to its customers for electric
operations with the exception of an immaterial percentage
of the output that has been contracted with a fuel cost pass-
through. Ameren Missouri has a FAC that allows Ameren
Missouri to recover, through customer rates, 95% of
changes in fuel and purchased power costs, net of
off-system revenues, including MISO costs and revenues,
more or less than the amount set in base rates, without a
traditional rate proceeding. Ameren Missouri remains
exposed to the remaining 5%.
75
Ameren, Ameren Missouri and Genco have entered
into coal contracts with various suppliers to purchase coal
to manage their exposure to fuel prices. The coal hedging
strategy is intended to secure a reliable coal supply while
reducing exposure to commodity price volatility.
Additionally, the type of coal burned is part of Ameren
Missouri’s environmental compliance strategy. Ameren
Missouri has a multiyear agreement to purchase
ultra-low-sulfur coal through 2017 to comply with the
CSAPR and other environmental regulations. The coal
contract is with a single supplier. Disruptions of the
deliveries of that ultra-low-sulfur coal from the supplier
could compromise Ameren Missouri’s ability to operate in
compliance with emission standards. Other sources of
ultra-low-sulfur coal are limited and the construction of
pollution control equipment requires significant lead time to
become operational. Should a temporary disruption of
ultra-low-sulfur coal deliveries occur and its existing
inventory of ultra-low-sulfur coal becomes fully depleted,
and other sources of ultra-low-sulfur coal are not available,
Ameren Missouri would use its existing emission
allowances or purchase emission allowances in order to
achieve compliance with environmental regulations. Genco
purchases coal based on expected power sales, generally
through bid procedures. Therefore, Genco’s forward coal
requirements are dependent on the volume of power sales
that have been contracted.
Transportation costs for coal and natural gas can be a
significant portion of fuel costs. Ameren, Ameren Missouri
and Genco typically hedge coal transportation forward to
provide supply certainty and to mitigate transportation price
volatility. Natural gas transportation expenses for Ameren’s
gas distribution utility companies and for the gas-fired
generation units of Ameren, Ameren Missouri and Genco
are regulated by FERC through approved tariffs governing
the rates, terms, and conditions of transportation and
storage services. Certain firm transportation and storage
capacity agreements held by the Ameren Companies
include rights to extend the term of contracts. Depending
on our competitive position, we are able in some instances
to negotiate discounts to these tariff rates for our
requirements.
In addition, coal transportation costs are sensitive to
the price of diesel fuel as a result of rail freight fuel
surcharges. We use forward fuel oil contracts (both for
heating and crude oil) to mitigate this market price risk as
changes in these products are highly correlated to changes
in diesel markets. If diesel fuel costs were to increase or
decrease by $0.25 a gallon, Ameren’s fuel expense could
increase or decrease by $14 million annually (Ameren
Missouri – $8 million, Genco – $5 million). As of
December 31, 2011, Ameren had a price cap for
approximately 87% of expected fuel surcharges in 2012.
In the event of a significant change in coal prices,
Ameren, Ameren Missouri and Genco would probably take
actions to further mitigate their exposure to this market
risk. However, due to the uncertainty of the specific actions
that would be taken and their possible effects, this
sensitivity analysis assumes no change in our financial
structure or fuel sources.
With regard to exposure for commodity price risk for
nuclear fuel, Ameren Missouri has fixed-priced, base-price-
with-escalation, and market-priced agreements. It uses
inventories to provide some price hedge to fulfill its
Callaway energy center’s needs for uranium, conversion,
and enrichment. There is no fuel reloading or planned
maintenance outage scheduled for 2012 and 2015. Ameren
Missouri has price hedges for approximately 74% of its
2013 to 2016 nuclear fuel requirements.
Nuclear fuel market prices remain subject to an
unpredictable supply and demand environment. Ameren
Missouri has continued to follow a strategy of managing its
inventory of nuclear fuel as an inherent price hedge. New
long-term uranium contracts are almost exclusively market-
price-related with an escalating price floor. New long-term
enrichment contracts usually have a base-price-with-
escalation price mechanism, and may also have either a
market-price-related component or market-based price
re-benchmarking. Ameren Missouri expects to enter into
additional contracts from time to time in order to supply
nuclear fuel during the expected life of the Callaway energy
center, at prices that cannot now be accurately predicted.
Unlike the electricity and natural gas markets, nuclear fuel
markets have somewhat limited financial instruments
available for price hedging, so most hedging is done
through inventories and forward contracts, if they are
available.
The electric generating operations for Ameren, Ameren
Missouri and Genco are exposed to changes in market
prices for natural gas used to run CTs. The natural gas
procurement strategy is designed to ensure reliable and
immediate delivery of natural gas while minimizing costs.
We optimize transportation and storage options and price
risk by structuring supply agreements to maintain access to
multiple gas pools and supply basins.
Through the market allocation and auction process,
Ameren and Ameren Missouri have been granted FTRs
associated with the MISO Energy and Operating Reserves
Market. In addition, Marketing Company has acquired FTRs
for its participation in the PJM-Northern Illinois and MISO
market. The FTRs are intended to mitigate electric
transmission congestion charges related to the physical
constraints of the transmission system. Depending on the
congestion, FTRs could result in either charges or credits.
Complex grid modeling tools are used to determine which
FTRs to nominate in the FTR allocation process. There is a
risk of incorrectly modeling the amount of FTRs needed,
and there is the potential that the FTRs could be ineffective
in mitigating transmission congestion charges.
With regard to Ameren Missouri’s and Ameren Illinois’
electric and natural gas distribution businesses, exposure to
changing market prices is in large part mitigated by the fact
that there are cost recovery mechanisms in place. These
cost recovery mechanisms allow Ameren Missouri and
Ameren Illinois to pass on to retail customers prudently
76
incurred costs for fuel, purchased power, and gas supply.
Ameren Missouri’s and Ameren Illinois’ strategy is designed
to reduce the effect of market fluctuations for their
regulated customers. The effects of price volatility cannot
be eliminated. However, procurement strategies involve risk
management techniques and instruments similar to those
outlined earlier, as well as the management of physical
assets.
The following table presents, as of December 31, 2011, the percentages of the projected required supply of coal and coal
transportation for our coal-fired energy centers, nuclear fuel for Ameren Missouri’s Callaway energy center, natural gas for our
CTs and retail distribution, as appropriate, and purchased power needs of Ameren Illinois, which does not own generation, that
are price-hedged over the period 2012 through 2016. The projected required supply of these commodities could be
significantly affected by changes in our assumptions for such matters as customer demand for our electric generation and our
electric and natural gas distribution services, generation output, and inventory levels, among other matters.
2012
2013
2014 – 2016
Ameren(a):
Coal(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Coal transportation(c)
Nuclear fuel
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas for generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas for distribution(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchased power for Ameren Illinois(d)
Ameren Missouri:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Coal
Coal transportation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear fuel
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas for generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas for distribution(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Natural gas for distribution(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchased power(d)
Genco:
Coal(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Coal transportation(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas for generation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
99%
100
100
20
87
87
100%
100
100
12
90
87%
87
89%
100
32
73%
98
92
1
35
52
98%
97
92
3
28
36%
52
32%
100
-
57%
88
64
-
16
4
90%
97
64
-
12
16%
4
17%
71
-
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) Represents the percentage of natural gas price-hedged for peak winter season of November through March. The year 2012 represents January
2012 through March 2012. The year 2013 represents November 2012 through March 2013. This continues each successive year through
March 2016.
(c) Ameren’s and Genco’s percentages of the projected required supply of coal and coal transportation have been adjusted to reflect the ceasing of
operations at the Meredosia and Hutsonville energy centers on December 31, 2011.
(d) Represents the percentage of purchased power price-hedged for fixed-price residential and small commercial customers with less than one
megawatt of demand. Larger customers are purchasing power from the competitive markets.
The following table shows how our total fuel expense might increase and how our net income might decrease if coal and
coal transportation costs were to increase by 1% on any requirements not currently covered by fixed-price contracts for the
five-year period 2012 through 2016.
Coal
Fuel
Expense
Net
Income(a)
Coal Transportation
Fuel
Expense
Net
Income(a)
Ameren(b)(c)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri(c)
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
10
(d)
8
$
(6)
(d)
(5)
$
3
(d)
3
$ (2)
(d)
(2)
(a) Calculations are based on an estimated tax rate of 40%, 38%, and 41% for Ameren, Ameren Missouri and Genco, respectively.
(b)
(c)
(d) Less than $1 million.
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
Includes the impact of the FAC.
With regard to our exposure for commodity price risk for construction and maintenance activities, Ameren is exposed to
changes in market prices for metal commodities and to labor availability.
See Supply for Electric Power under Part I, Item 1, of this report for the percentages of our historical needs satisfied by
coal, nuclear power, natural gas, hydroelectric power, and oil. Also see Note 15 – Commitments and Contingencies under
Part II, Item 8, of this report for additional information.
77
Fair Value of Contracts
Most of our commodity contracts that meet the definition of derivatives qualify for treatment as NPNS. We use derivatives
principally to manage the risk of changes in market prices for natural gas, coal, diesel, power, and uranium. The following
table presents the favorable (unfavorable) changes in the fair value of all derivative contracts marked-to-market during the year
ended December 31, 2011. We use various methods to determine the fair value of our contracts. In accordance authoritative
accounting guidance for fair value with hierarchy levels, the sources we used to determine the fair value of these contracts
were active quotes (Level 1), inputs corroborated by market data (Level 2), and other modeling and valuation methods that are
not corroborated by market data (Level 3). See Note 8 – Fair Value Measurements under Part II, Item 8, of this report for
further information regarding the methods used to determine the fair value of these contracts.
Ameren(a)
Ameren
Missouri
Ameren
Illinois
Genco
Other(b)
Fair value of contracts at beginning of year, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
Contracts realized or otherwise settled during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Changes in fair values attributable to changes in valuation technique and assumptions . . . .
Fair value of new contracts entered into during the period . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other changes in fair value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(79) $
31
-
21
(16)
$
$
11
(11)
-
20
(2)
(493)
272
-
(24)
(62)
$ 19
(12)
-
1
2
384
(218)
-
24
46
Fair value of contracts outstanding at end of year, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $
(43) $
18
$
(307)
$ 10
$
236
(a)
(b)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
Includes amounts for Merchant Generation nonregistrant subsidiaries and intercompany eliminations.
The following table presents maturities of derivative contracts as of December 31, 2011, based on the hierarchy levels
used to determine the fair value of the contracts:
Sources of Fair Value
Ameren:
Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 2(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 3(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 2(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 3(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 2(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 3(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 2(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Level 3(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Maturity
Less Than
1 Year
Maturity
1-3 Years
Maturity
4-5 Years
Maturity in
Excess of
5 Years
Total
Fair Value
$
$
$
$
$
$
$
$
17
-
(62)
(45)
13
-
14
27
(7)
-
(293)
(300)
8
-
-
8
$
$
$
$
$
$
$
$
(3)
-
(80)
(83)
(4)
-
(4)
(8)
-
-
(94)
(94)
1
-
1
2
$
$
$
$
$
$
$
$
(1)
-
(15)
(16)
-
-
(1)
(1)
-
-
(14)
(14)
-
-
-
-
$
$
$
$
$
$
$
$
-
-
101
101
-
-
-
-
-
-
101
101
-
-
-
-
$
$
$
$
$
$
$
$
13
-
(56)
(43)
9
-
9
18
(7)
-
(300)
(307)
9
-
1
10
(a) Principally fixed-price vs. floating over-the-counter power swaps, power forwards, and fixed price vs. floating over-the-counter natural gas
swaps.
(b) Principally power forward contract values based on a Black-Scholes model that includes information from external sources and our estimates.
Level 3 also includes option contract values based on our estimates.
78
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders
of Ameren Corporation:
In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all
material respects, the financial position of Ameren Corporation and its subsidiaries at December 31, 2011 and 2010, and the
results of their operations and their cash flows for each of the three years in the period ended December 31, 2011, in
conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company
maintained, in all material respects, effective internal control over financial reporting as of December 31, 2011, based on
criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO). The Company’s management is responsible for these financial statements, for maintaining
effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial
reporting, included in Management’s Report on Internal Control over Financial Reporting appearing under Item 9A. Our
responsibility is to express opinions on these financial statements and on the Company’s internal control over financial
reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable
assurance about whether the financial statements are free of material misstatement and whether effective internal control over
financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of
internal control over financial reporting included obtaining an understanding of internal control over financial reporting,
assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal
control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in
the circumstances. We believe that our audits provide a reasonable basis for our opinions.
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally
accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures
that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and
dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to
permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and
expenditures of the company are being made only in accordance with authorizations of management and directors of the
company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or
disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate
because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders
of Union Electric Company:
In our opinion, the financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all material respects,
the financial position of Union Electric Company at December 31, 2011 and 2010, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2011, in conformity with accounting principles generally
accepted in the United States of America. These financial statements are the responsibility of the Company’s management. Our
responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these
statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and
79
disclosures in the financial statements, assessing the accounting principles used and significant estimates made by
management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis
for our opinion.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholders
of Ameren Illinois Company:
In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all
material respects, the financial position of Ameren Illinois Company and its subsidiaries at December 31, 2011 and 2010, and
the results of their operations and their cash flows for each of the three years in the period ended December 31, 2011, in
conformity with accounting principles generally accepted in the United States of America. These financial statements are the
responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based
on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
Report of Independent Registered Public Accounting Firm
To the Board of Directors and Shareholder
of Ameren Energy Generating Company:
In our opinion, the consolidated financial statements listed in the index appearing under Item 15(a)(1) present fairly, in all
material respects, the financial position of Ameren Energy Generating Company and its subsidiaries at December 31, 2011 and
2010, and the results of their operations and their cash flows for each of the three years in the period ended December 31,
2011, in conformity with accounting principles generally accepted in the United States of America. These financial statements
are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements
based on our audits. We conducted our audits of these statements in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that
our audits provide a reasonable basis for our opinion.
/s/PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
80
ITEM 1. FINANCIAL STATEMENTS.
PART I. FINANCIAL INFORMATION
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(In millions, except per share amounts)
Year Ended December 31,
2010
2011
2009
Operating Revenues:
Electric
Gas
Total operating revenues
Operating Expenses:
Fuel
Purchased power
Gas purchased for resale
Other operations and maintenance
Goodwill, impairment and other charges
Depreciation and amortization
Taxes other than income taxes
Total operating expenses
Operating Income
Other Income and Expenses:
Miscellaneous income
Miscellaneous expense
Total other income
Interest Charges
Income Before Income Taxes
Income Taxes
Net Income
Less: Net Income Attributable to Noncontrolling Interests
Net Income Attributable to Ameren Corporation
Earnings per Common Share – Basic and Diluted
Dividends per Common Share
Average Common Shares Outstanding
$
$
$
$
6,530
1,001
7,531
1,567
966
570
1,820
125
785
457
6,290
1,241
69
23
46
451
836
310
526
7
519
2.15
1.555
241.5
$
$
$
$
6,521
1,117
7,638
1,323
1,106
669
1,821
589
765
449
6,722
916
90
33
57
497
476
325
151
12
139
0.58
1.540
238.8
$
$
$
5,940
1,195
7,135
1,141
909
749
1,768
7
725
420
5,719
1,416
71
23
48
508
956
332
624
12
612
2.78
$ 1.540
220.4
The accompanying notes are an integral part of these consolidated financial statements.
81
AMEREN CORPORATION
CONSOLIDATED BALANCE SHEET
(In millions, except per share amounts)
ASSETS
Current Assets:
Cash and cash equivalents
Accounts receivable – trade (less allowance for doubtful accounts of $20 and $23,
respectively)
Unbilled revenue
Miscellaneous accounts and notes receivable
Materials and supplies
Mark-to-market derivative assets
Current regulatory assets
Other current assets
Total current assets
Property and Plant, Net
Investments and Other Assets:
Nuclear decommissioning trust fund
Goodwill
Intangible assets
Regulatory assets
Other assets
Total investments and other assets
TOTAL ASSETS
LIABILITIES AND EQUITY
Current Liabilities:
Current maturities of long-term debt
Short-term debt
Accounts and wages payable
Taxes accrued
Interest accrued
Customer deposits
Mark-to-market derivative liabilities
Current regulatory liabilities
Other current liabilities
Total current liabilities
Credit Facility Borrowings
Long-term Debt, Net
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net
Accumulated deferred investment tax credits
Regulatory liabilities
Asset retirement obligations
Pension and other postretirement benefits
Other deferred credits and liabilities
Total deferred credits and other liabilities
Commitments and Contingencies (Notes 2, 10, 14 and 15)
Ameren Corporation Stockholders’ Equity:
240.4, respectively
Other paid-in capital, principally premium on common stock
Retained earnings
Accumulated other comprehensive loss
Total Ameren Corporation stockholders’ equity
Noncontrolling Interests
Total equity
TOTAL LIABILITIES AND EQUITY
Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 242.6 and
The accompanying notes are an integral part of these consolidated financial statements.
82
December 31,
2010
2011
$
255 $
545
473
324
69
712
115
215
132
2,295
18,127
517
406
210
707
129
267
109
2,890
17,853
357
411
7
1,603
845
3,223
337
411
7
1,263
750
2,768
$ 23,645 $ 23,511
$
179 $
148
693
65
101
98
161
133
207
1,785
-
6,677
3,315
79
1,502
428
1,344
447
7,115
155
269
651
63
107
100
161
99
283
1,888
460
6,853
2,882
90
1,319
475
1,045
615
6,426
2
5,598
2,369
(50)
7,919
149
8,068
2
5,520
2,225
(17)
7,730
154
7,884
$ 23,645 $ 23,511
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
Year Ended December 31,
2010
2011
2009
Cash Flows From Operating Activities:
Net income
Adjustments to reconcile net income to net cash provided by operating
$
526
$
151
$
624
activities:
Goodwill, impairment and other charges
Gain on sales of properties
Net mark-to-market (gain) loss on derivatives
Depreciation and amortization
Amortization of nuclear fuel
Amortization of debt issuance costs and premium/discounts
Deferred income taxes and investment tax credits, net
Allowance for equity funds used during construction
Other
Changes in assets and liabilities:
Receivables
Materials and supplies
Accounts and wages payable
Taxes accrued
Assets, other
Liabilities, other
Pension and other postretirement benefits
Counterparty collateral, net
Taum Sauk insurance recoveries, net of costs
Net cash provided by operating activities
Cash Flows From Investing Activities:
Capital expenditures
Nuclear fuel expenditures
Purchases of securities – nuclear decommissioning trust fund
Sales of securities – nuclear decommissioning trust fund
Proceeds from sales of properties
Other
Net cash used in investing activities
Cash Flows From Financing Activities:
Dividends on common stock
Dividends paid to noncontrolling interest holders
Capital issuance costs
Short-term debt and credit facility repayments, net
Redemptions, repurchases, and maturities:
Long-term debt
Preferred stock
Issuances:
Common stock
Long-term debt
Repayments of generator advances received for construction
Generator advances received for construction
Net cash provided by (used in) financing activities
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash Paid (Refunded) During the Year:
Interest (net of $30, $34, and $40 capitalized, respectively)
Income taxes, net
125
(15)
11
747
61
21
346
(34)
-
231
(27)
(36)
(3)
76
(75)
(102)
27
(1)
1,878
(1,030)
(62)
(220)
199
53
12
(1,048)
(375)
(6)
-
(581)
(155)
-
65
-
(73)
5
(1,120)
(290)
545
255
453
(61)
$
$
589
(10)
(15)
746
54
23
410
(52)
21
(197)
73
20
10
(47)
71
(5)
(73)
54
1,823
(1,042)
(68)
(271)
256
27
2
(1,096)
(368)
(8)
(15)
(121)
(310)
(52)
80
-
(39)
29
(804)
(77)
622
545
494
(92)
$
$
7
-
(23)
708
53
25
290
(36)
(24)
136
63
(40)
1
11
91
(9)
(17)
107
1,967
(1,710)
(72)
(383)
380
2
2
(1,781)
(338)
(21)
(65)
(324)
(631)
-
634
1,021
-
68
344
530
92
622
485
9
$
$
The accompanying notes are an integral part of these consolidated financial statements.
83
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
(In millions)
Common Stock:
Beginning of year
Shares issued
Common stock, end of year
Other Paid-in Capital:
Beginning of year
Shares issued (less issuance costs of $-, $-, and $17, respectively)
Stock-based compensation activity
Regulatory recovery of prior-period common stock issuance costs
Other paid-in capital, end of year
Retained Earnings:
Beginning of year
Net income attributable to Ameren Corporation
Dividends
Other
Retained earnings, end of year
Accumulated Other Comprehensive Income (Loss):
Derivative financial instruments, beginning of year
Change in derivative financial instruments
Derivative financial instruments, end of year
Deferred retirement benefit costs, beginning of year
Change in deferred retirement benefit costs
Deferred retirement benefit costs, end of year
Total accumulated other comprehensive loss, end of year
Total Ameren Corporation Stockholders’ Equity
Noncontrolling Interests:
Beginning of year
Net income attributable to noncontrolling interest holders
Dividends paid to noncontrolling interest holders
Redemptions of preferred stock
Other
Noncontrolling interests, end of year
Total Equity
Comprehensive Income, Net of Taxes:
Net income
Unrealized net gain (loss) on derivative hedging instruments, net of income taxes
(benefit) of $1, $(1), and $78, respectively
Reclassification adjustments for derivative (gains) losses included in net income,
net of income taxes (benefit) of $(3), $5, and $82, respectively
Reclassification adjustment due to implementation of FAC, net of income taxes
of $-, $-, and $18, respectively
Pension and other postretirement activity, net of income taxes (benefit) of $(32),
$6, and $22, respectively
Total Comprehensive Income, Net of Taxes
Comprehensive income attributable to noncontrolling interests
Total Comprehensive Income Attributable to Ameren Corporation, Net of Taxes
Common stock shares at beginning of year
Shares issued
Common stock shares at end of year
December 31,
2010
2011
2009
$
$
2
-
2
$
2
-
2
2
-
2
5,520
65
13
-
5,598
2,225
519
(375)
-
2,369
-
7
7
(17)
(40)
(57)
(50)
$ 7,919
154
7
(6)
-
(6)
149
$ 8,068
5,412
80
14
14
5,520
2,455
139
(368)
(1)
2,225
10
(10)
-
(23)
6
(17)
(17)
$ 7,730
204
12
(8)
(52)
(2)
154
$ 7,884
4,780
617
15
-
5,412
2,181
612
(338)
-
2,455
48
(38)
10
(43)
20
(23)
(13)
$ 7,856
211
12
(21)
-
2
204
$ 8,060
$
526
$
151
$
624
3
4
-
(46)
487
1
486
$
$
$
$
(2)
(8)
-
4
145
10
135
240.4
2.2
242.6
237.4
3.0
240.4
103
(112)
(29)
22
608
14
594
212.3
25.1
237.4
$
$
The accompanying notes are an integral part of these consolidated financial statements.
84
UNION ELECTRIC COMPANY
STATEMENT OF INCOME
(In millions)
Year Ended December 31,
2010
2011
2009
Operating Revenues:
Electric
Gas
Other
Total operating revenues
Operating Expenses:
Fuel
Purchased power
Gas purchased for resale
Other operations and maintenance
Loss from regulatory disallowance
Depreciation and amortization
Taxes other than income taxes
Total operating expenses
Operating Income
Other Income and Expenses:
Miscellaneous income
Miscellaneous expense
Total other income
Interest Charges
Income Before Income Taxes
Income Taxes
Net Income
Preferred Stock Dividends
$
3,222
156
5
3,383
$
3,030
166
1
3,197
$ 2,700
170
4
2,874
866
104
77
934
89
408
296
635
162
91
931
-
382
285
593
124
97
880
-
357
257
2,774
609
2,486
711
2,308
566
61
10
51
209
451
161
290
3
83
13
70
213
568
199
369
5
63
7
56
229
393
128
265
6
Net Income Available to Common Stockholder
$
287
$
364
$
259
The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.
85
UNION ELECTRIC COMPANY
BALANCE SHEET
(In millions, except per share amounts)
Current Assets:
ASSETS
Cash and cash equivalents
Accounts receivable – trade (less allowance for doubtful accounts of $7 and $8,
$
201
$
202
December 31,
2011
2010
respectively)
Accounts receivable – affiliates
Unbilled revenue
Miscellaneous accounts and notes receivable
Materials and supplies
Current regulatory assets
Other current assets
Total current assets
Property and Plant, Net
Investments and Other Assets:
Nuclear decommissioning trust fund
Intangible assets
Regulatory assets
Other assets
Total investments and other assets
TOTAL ASSETS
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current maturities of long-term debt
Accounts and wages payable
Accounts payable – affiliates
Taxes accrued
Interest accrued
Current regulatory liabilities
Current accumulated deferred income taxes, net
Other current liabilities
Total current liabilities
Long-term Debt, Net
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net
Accumulated deferred investment tax credits
Regulatory liabilities
Asset retirement obligations
Pension and other postretirement benefits
Other deferred credits and liabilities
Total deferred credits and other liabilities
Commitments and Contingencies (Notes 2, 10, 14 and 15)
Stockholders’ Equity:
Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding
Other paid-in capital, principally premium on common stock
Preferred stock not subject to mandatory redemption
Retained earnings
Total stockholders’ equity
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
212
1
139
42
348
109
82
1,134
9,958
217
6
159
116
341
179
55
1,275
9,775
357
7
855
446
1,665
$ 12,757
337
2
694
421
1,454
$ 12,504
$
178
414
73
74
62
57
-
84
942
3,772
2,132
70
836
328
491
149
4,006
$
5
326
75
76
63
23
43
89
700
3,949
1,908
78
766
363
369
218
3,702
511
1,555
80
1,891
4,037
$ 12,757
511
1,555
80
2,007
4,153
$ 12,504
The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.
86
UNION ELECTRIC COMPANY
STATEMENT OF CASH FLOWS
(In millions)
Year Ended December 31,
2010
2009
2011
Cash Flows From Operating Activities:
Net income
Adjustments to reconcile net income to net cash provided by operating
$
290
$
369
$
265
activities:
Loss from regulatory disallowance
Gain on sale of properties
Net mark-to-market (gain) loss on derivatives
Depreciation and amortization
Amortization of nuclear fuel
Amortization of debt issuance costs and premium/discounts
Deferred income taxes and investment tax credits, net
Allowance for equity funds used during construction
Other
Changes in assets and liabilities:
Receivables
Materials and supplies
Accounts and wages payable
Taxes accrued
Assets, other
Liabilities, other
Pension and other postretirement benefits
Taum Sauk insurance recoveries, net of costs
Net cash provided by operating activities
Cash Flows From Investing Activities:
Capital expenditures
Nuclear fuel expenditures
Purchases of securities – nuclear decommissioning trust fund
Sales of securities – nuclear decommissioning trust fund
Other
Net cash used in investing activities
Cash Flows From Financing Activities:
Dividends on common stock
Dividends on preferred stock
Capital issuance costs
Short-term debt, net
Intercompany note payable – Ameren, net
Redemptions, repurchases, and maturities:
Long-term debt
Preferred stock
Issuances of long-term debt
Capital contribution from parent
Generator advances for construction received (refunded)
Net cash provided by (used in) financing activities
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash Paid (Refunded) During the Year:
Interest (net of $25, $26, and $23 capitalized, respectively)
Income taxes, net
89
(3)
1
377
61
6
155
(30)
(6)
66
(7)
13
(6)
79
(30)
2
(1)
1,056
(550)
(62)
(220)
199
6
(627)
(403)
(3)
-
-
-
(5)
-
-
-
(19)
-
(5)
(1)
355
54
4
292
(50)
10
(122)
7
(24)
55
(101)
75
(3)
54
969
(624)
(68)
(271)
256
7
(700)
(235)
(5)
(4)
-
-
(70)
(33)
-
-
13
(430)
(334)
(1)
202
201
210
9
(65)
267
202
213
(106)
$
$
$
$
$
$
-
-
(29)
333
53
10
212
(33)
-
7
(2)
18
1
(34)
69
(2)
107
975
(882)
(72)
(383)
380
-
(957)
(175)
(6)
(14)
(251)
(92)
(4)
-
349
436
6
249
267
-
267
212
(208)
The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.
87
UNION ELECTRIC COMPANY
STATEMENT OF STOCKHOLDERS’ EQUITY
(In millions)
Common Stock
Other Paid-in Capital:
Beginning of year
Capital contribution from parent
Other paid-in capital, end of year
Preferred Stock Not Subject to Mandatory Redemption:
Beginning balance
Redemptions
Preferred stock not subject to mandatory redemption, end of year
Retained Earnings:
Beginning of year
Net income
Common stock dividends
Preferred stock dividends
Retained earnings, end of year
Accumulated Other Comprehensive Income:
Beginning of year
Change in derivative financial instruments
Accumulated other comprehensive income, end of year
Total Stockholders’ Equity
Comprehensive Income, Net of Taxes:
December 31,
2010
2011
2009
$
511
$
511
$
511
1,555
-
1,555
80
-
80
2,007
290
(403)
(3)
1,891
-
-
-
1,555
-
1,555
113
(33)
80
1,878
369
(235)
(5)
2,007
-
-
-
1,119
436
1,555
113
-
113
1,794
265
(175)
(6)
1,878
25
(25)
-
$ 4,037
$ 4,153
$ 4,057
Net income
Unrealized net gain on derivative hedging instruments, net of income taxes of $-,
$
290
$
369
$
265
$-, and $11, respectively
Reclassification adjustments for derivative (gains) included in net income, net of
income taxes of $-, $-, and $8, respectively
Reclassification adjustment due to implementation of FAC, net of income taxes of
$-, $-, and $18, respectively
-
-
-
-
-
-
17
(13)
(29)
Total Comprehensive Income, Net of Taxes
$
290
$
369
$
240
The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.
88
AMEREN ILLINOIS COMPANY
CONSOLIDATED STATEMENT OF INCOME
(In millions)
Operating Revenues:
Electric
Gas
Other
Total operating revenues
Operating Expenses:
Purchased power
Gas purchased for resale
Other operations and maintenance
Depreciation and amortization
Taxes other than income taxes
Total operating expenses
Operating Income
Other Income and Expenses:
Miscellaneous income
Miscellaneous expense
Total other income (expense)
Interest Charges
Income Before Income Taxes
Income Taxes
Income from Continuing Operations
Income from Discontinued Operations, net of tax
Net Income
Preferred Stock Dividends
Year Ended December 31,
2009(a)
2010
2011
$ 1,940
846
1
$ 2,061
953
-
$ 1,965
1,015
4
2,787
3,014
2,984
853
492
640
215
129
2,329
458
7
6
1
136
323
127
196
-
196
3
965
578
635
210
128
2,516
498
1,048
642
590
216
125
2,621
363
7
13
(6)
143
349
137
212
40
252
4
12
10
2
153
212
79
133
114
247
6
Net Income Available to Common Stockholder
$
193
$
248
$
241
(a) Prior period has been adjusted to reflect the Ameren Illinois Merger as discussed in Note 1 – Summary of Significant Accounting Policies.
The accompanying notes as they relate to Ameren Illinois are an integral part of these consolidated financial statements.
89
AMEREN ILLINOIS COMPANY
CONSOLIDATED BALANCE SHEET
(In millions)
Current Assets:
ASSETS
Cash and cash equivalents
Accounts receivable – trade (less allowance for doubtful accounts of $13 and $13,
$
21$
322
December 31,
2011
2010
respectively)
Accounts receivable – affiliates
Unbilled revenue
Miscellaneous accounts receivable
Materials and supplies
Current regulatory assets
Current accumulated deferred income taxes, net
Other current assets
Total current assets
Property and Plant, Net
Investments and Other Assets:
Intercompany tax receivable – Genco
Goodwill
Regulatory assets
Other assets
Total investments and other assets
TOTAL ASSETS
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current maturities of long-term debt
Accounts and wages payable
Accounts payable – affiliates
Taxes accrued
Customer deposits
Mark-to-market derivative liabilities
Mark-to-market derivative liabilities – affiliates
Environmental remediation
Current regulatory liabilities
Other current liabilities
Total current liabilities
Long-term Debt, Net
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net
Accumulated deferred investment tax credits
Regulatory liabilities
Pension and other postretirement benefits
Other deferred credits and liabilities
Total deferred credits and other liabilities
Commitments and Contingencies (Notes 2, 14 and 15)
Stockholders’ Equity:
Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding
Other paid-in capital
Preferred stock not subject to mandatory redemption
Retained earnings
Accumulated other comprehensive income
Total stockholders’ equity
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
201
15
146
6
199
306
58
65
1,017
4,770
230
73
205
44
198
260
43
63
1,438
4,576
56
411
748
211
1,426
$ 7,213
72
411
747
162
1,392
$ 7,406
$
1
133
103
15
76
99
200
63
76
92
858
1,657
895
7
666
495
183
2,246
$
150
182
82
26
83
82
172
72
76
90
1,015
1,657
724
8
553
413
460
2,158
-
1,965
62
408
17
2,452
$ 7,213
-
1,952
62
542
20
2,576
$ 7,406
The accompanying notes as they relate to Ameren Illinois are an integral part of these consolidated financial statements.
90
AMEREN ILLINOIS COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
Cash Flows From Operating Activities:
Net income
Income from discontinued operations, net of tax
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation and amortization
Amortization of debt issuance costs and premium/discounts
Deferred income taxes and investment tax credits, net
Other
Changes in assets and liabilities:
Receivables
Materials and supplies
Accounts and wages payable
Taxes accrued
Assets, other
Liabilities, other
Pension and other postretirement benefits
Counterparty collateral, net
Operating cash flows provided by discontinued operations
Net cash provided by operating activities
Cash Flows From Investing Activities:
Capital expenditures
Returns from (advances to) ATXI for construction
Proceeds from intercompany note receivable – Genco
Other
Capital expenditures of discontinued operations
Net cash used in investing activities
Cash Flows From Financing Activities:
Dividends on common stock
Dividends on preferred stock
Capital issuance costs
Short-term debt and credit facility repayments
Redemptions, repurchases, and maturities:
Long-term debt
Preferred stock
Repayments of generator advances received for construction
Generator advances received for construction
Capital contribution from parent
Net financing activities used in discontinued operations
Net cash used in financing activities
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash Paid (Refunded) During the Year:
Interest (net of $2, $1, and $3 capitalized, respectively)
Income taxes, net
Noncash investing activity – asset transfer from ATXI
Noncash financing activity – capital contribution from parent
Year Ended December 31,
2010
2011
2009(a)
$
196
-
$
252
(40)
$
247
(114)
206
8
155
(14)
146
(21)
(46)
(12)
(3)
(30)
(101)
20
-
504
(351)
49
-
6
-
(296)
(327)
(3)
-
-
(150)
-
(53)
5
19
-
(509)
(301)
322
21
137
(14)
-
-
$
$
201
10
210
(3)
(84)
9
(44)
11
32
33
(7)
(100)
113
593
(281)
(10)
45
5
(6)
(247)
(133)
(4)
(4)
-
(40)
(19)
(39)
16
-
(107)
(330)
16
306
322
160
(39)
7
6
$
$
195
9
23
(40)
187
81
(3)
(11)
27
6
5
92
141
845
(352)
(47)
42
6
(91)
(442)
(98)
(6)
(13)
(62)
(250)
-
(2)
62
272
(50)
(147)
256
50
306
167
129
29
-
$
$
(a) Prior period has been adjusted to reflect the Ameren Illinois Merger as discussed in Note 1 – Summary of Significant Accounting Policies.
The accompanying notes as they relate to Ameren Illinois are an integral part of these consolidated financial statements.
91
AMEREN ILLINOIS COMPANY
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
(In millions)
Common Stock
Other Paid-in Capital:
Beginning of year
Capital contribution from parent
Contribution of Ameren owned preferred stock without consideration
Transfer of AERG to parent (Notes 1 and 16)
Other paid-in capital, end of year
Preferred Stock Not Subject to Mandatory Redemption:
Beginning balance
Redemptions
Contribution of Ameren owned preferred stock without consideration
Other
Preferred stock not subject to mandatory redemption, end of year
Retained Earnings:
Beginning of year
Net income
Common stock dividends
Preferred stock dividends
Transfer of AERG to parent (Notes 1 and 16)
Other
Retained earnings, end of year
Accumulated Other Comprehensive Income:
Deferred retirement benefit costs, beginning of year
Change in deferred retirement benefit costs
Change in accumulated other comprehensive income from discontinued
operations
Deferred retirement benefit costs, end of year
Total accumulated other comprehensive income, end of year
Total Stockholders’ Equity
Comprehensive Income, Net of Taxes:
December 31,
2010
2011
2009(a)
$
-
$
-
$
-
1,952
13
-
-
1,965
62
-
-
-
62
542
196
(327)
(3)
-
-
408
20
(3)
-
17
17
2,223
6
33
(310)
1,952
115
(19)
(33)
(1)
62
709
252
(133)
(4)
(281)
(1)
542
25
(4)
(1)
20
20
1,951
272
-
-
2,223
115
-
-
-
115
566
247
(98)
(6)
-
-
709
23
(4)
6
25
25
$ 2,452
$ 2,576
$ 3,072
Net income
Pension and other postretirement activity, net of income taxes (benefit) of $(2),
$
196
$
252
$
247
$(2), and $(2), respectively
Other comprehensive income from discontinued operations
Total Comprehensive Income, Net of Taxes
(3)
-
(4)
(1)
(4)
6
$
193
$
247
$
249
(a) Prior period has been adjusted to reflect the Ameren Illinois Merger as discussed in Note 1 – Summary of Significant Accounting Policies.
The accompanying notes as they relate to Ameren Illinois are an integral part of these consolidated financial statements.
92
AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED STATEMENT OF INCOME (LOSS)
(In millions)
Operating Revenues
Operating Expenses:
Fuel
Purchased power
Other operations and maintenance
Goodwill, impairment and other charges
Depreciation and amortization
Taxes other than income taxes
Total operating expenses
Operating Income
Other Income and Expenses:
Miscellaneous income
Miscellaneous expense
Total other income
Interest Charges
Income (Loss) Before Income Taxes
Income Taxes
Net Income (Loss)
Year Ended December 31,
2010
2011
2009(a)
$
1,066
$
1,126
$ 1,148
541
55
179
35
96
21
927
139
1
-
1
63
77
32
45
1
44
522
61
191
170
98
22
1,064
62
1
1
-
78
(16)
20
(36)
3
415
72
226
6
81
24
824
324
1
1
-
61
263
101
162
2
$
(39)
$
160
Less: Net Income Attributable to Noncontrolling Interest
Net Income (Loss) Attributable to Ameren Energy Generating Company
$
(a) Prior period has been adjusted to include EEI as discussed in Note 1 – Summary of Significant Accounting Policies.
The accompanying notes as they relate to Genco are an integral part of these consolidated financial statements.
93
AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED BALANCE SHEET
(In millions, except shares)
ASSETS
Current Assets:
Cash and cash equivalents
Advances to money pool
Accounts receivable – affiliates
Miscellaneous accounts receivable
Materials and supplies
Mark-to-market derivative assets
Other current assets
Total current assets
Property and Plant, Net
Investments and Other Assets:
Intangible assets
Other assets
Total investments and other assets
TOTAL ASSETS
LIABILITIES AND EQUITY
Current Liabilities:
Accounts and wages payable
Accounts payable – affiliates
Current portion of tax payable – Ameren Illinois
Taxes accrued
Interest accrued
Mark-to-market derivative liabilities
Mark-to-market derivative liabilities – affiliates
Current accumulated deferred income taxes, net
Other current liabilities
Total current liabilities
Credit Facility Borrowings
Long-term Debt, Net
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net
Accumulated deferred investment tax credits
Tax payable – Ameren Illinois
Asset retirement obligations
Pension and other postretirement benefits
Other deferred credits and liabilities
Total deferred credits and other liabilities
Commitments and Contingencies (Notes 2, 14 and 15)
Ameren Energy Generating Company Stockholder’s Equity:
Common stock, no par value, 10,000 shares authorized – 2,000 shares outstanding
Other paid-in capital
Retained earnings
Accumulated other comprehensive loss
Total Ameren Energy Generating Company stockholder’s equity
Noncontrolling Interest
Total equity
TOTAL LIABILITIES AND EQUITY
December 31,
2011
2010
$
$
$
8
74
89
13
122
12
7
325
2,231
-
16
16
2,572
71
13
8
20
13
3
-
-
14
142
-
824
304
2
56
66
141
12
581
$
$
$
6
25
126
15
130
26
4
332
2,248
3
24
27
2,607
62
23
8
20
13
9
5
13
12
165
100
824
249
3
72
74
88
23
509
-
653
437
(72)
1,018
7
1,025
2,572
$
-
649
393
(44)
998
11
1,009
2,607
$
The accompanying notes as they relate to Genco are an integral part of these consolidated financial statements.
94
AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(In millions)
Cash Flows From Operating Activities:
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating
activities:
Goodwill, impairment and other charges
Gain on sales of properties
Net mark-to-market (gain) loss on derivatives
Depreciation and amortization
Amortization of debt issuance costs and premium/discounts
Deferred income taxes and investment tax credits, net
Other
Changes in assets and liabilities:
Receivables
Materials and supplies
Accounts and wages payable
Taxes accrued
Assets, other
Liabilities, other
Pension and other postretirement benefits
Net cash provided by operating activities
Cash Flows From Investing Activities:
Capital expenditures
Proceeds from sales of properties
Money pool advances, net
Net cash used in investing activities
Cash Flows From Financing Activities:
Dividends on common stock
Dividends paid to noncontrolling interest holder
Capital issuance costs
Credit facility repayments, net
Money pool borrowings, net
Redemptions of long-term debt
Issuances of long-term debt
Notes payable – affiliates
Capital contribution from parent
Net cash provided by (used in) financing activities
Net change in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Cash Paid (Refunded) During the Year:
Interest (net of $3, $6, and $12 capitalized, respectively)
Income taxes, net
Noncash financing activity – capital contribution from parent
Year Ended December 31,
2009(a)
2010
2011
$
45
$
(36)
$ 162
35
(12)
2
98
3
64
1
19
5
(15)
-
2
(30)
(2)
215
(141)
49
(49)
(141)
-
-
-
(100)
-
-
-
-
28
(72)
2
6
8
60
(25)
-
$
$
170
(5)
(8)
113
3
15
6
38
42
(25)
3
7
(24)
5
304
(95)
18
48
(29)
-
-
(4)
100
-
(200)
-
(176)
5
(275)
-
6
6
77
1
24
$
$
6
-
(27)
106
2
64
-
(13)
(12)
(19)
-
9
(26)
1
253
(316)
-
(73)
(389)
(43)
(11)
(7)
-
(80)
-
249
31
-
139
3
3
6
58
74
-
$
$
(a) Prior period has been adjusted to include EEI as discussed in Note 1 – Summary of Significant Accounting Policies.
The accompanying notes as they relate to Genco are an integral part of these consolidated financial statements.
95
AMEREN ENERGY GENERATING COMPANY
CONSOLIDATED STATEMENT OF STOCKHOLDER’S EQUITY
(In millions)
Common Stock
Other Paid-in Capital:
Beginning of year
Capital contribution from parent
Other paid-in capital, end of year
Retained Earnings:
Beginning of year
Net income (loss) attributable to Ameren Energy Generating Company
Common stock dividends
Retained earnings, end of year
Accumulated Other Comprehensive Loss:
Derivative financial instruments, beginning of year
Change in derivative financial instruments
Derivative financial instruments, end of year
Deferred retirement benefit costs, beginning of year
Change in deferred retirement benefit costs
Deferred retirement benefit costs, end of year
Total accumulated other comprehensive loss, end of year
December 31,
2010
2011
2009(a)
$
-
$
-
$
-
649
4
653
393
44
-
437
(6)
1
(5)
(38)
(29)
(67)
(72)
620
29
649
432
(39)
-
393
(6)
-
(6)
(42)
4
(38)
(44)
620
-
620
315
160
(43)
432
(6)
-
(6)
(61)
19
(42)
(48)
Total Ameren Energy Generating Company Stockholder’s Equity
$
1,018
$
998
$ 1,004
Noncontrolling Interest:
Beginning of year
Net income attributable to noncontrolling interest holder
Dividends paid to noncontrolling interest holder
Other comprehensive income (loss) attributable to noncontrolling
interest holder
Noncontrolling interest, end of year
11
1
-
(5)
7
9
3
-
(1)
11
16
2
(11)
2
9
Total Equity
$
1,025
$
1,009
$ 1,013
Comprehensive Income (Loss), Net of Taxes:
Net income (loss)
Reclassification adjustments for derivative gains included in net income, net
of income taxes of $–, $–, and $–, respectively
Pension and other postretirement activity, net of income taxes (benefit) of
$(24), $5, and $12, respectively
Total Comprehensive Income (Loss), Net of Taxes
Comprehensive income (loss) attributable to noncontrolling interest holder
Total Comprehensive Income (Loss) Attributable to Ameren Energy
Generating Company, Net of Taxes
$
45
$
(36)
$
162
1
(34)
12
(4)
-
3
$
$
(33)
2
-
21
183
4
16
$
(35)
$
179
$
$
(a) Prior period has been adjusted to include EEI as discussed in Note 1 – Summary of Significant Accounting Policies.
The accompanying notes as they relate to Genco are an integral part of these consolidated financial statements.
96
AMEREN CORPORATION (Consolidated)
UNION ELECTRIC COMPANY
AMEREN ILLINOIS COMPANY (Consolidated)
AMEREN ENERGY GENERATING COMPANY
(Consolidated)
COMBINED NOTES TO FINANCIAL STATEMENTS
December 31, 2011
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
General
Ameren, headquartered in St. Louis, Missouri, is a
public utility holding company under PUHCA 2005,
administered by FERC. Ameren’s primary assets are the
common stock of its subsidiaries. Ameren’s subsidiaries
are separate, independent legal entities with separate
businesses, assets, and liabilities. These subsidiaries
operate, as the case may be, rate-regulated electric
generation, transmission and distribution businesses, rate-
regulated natural gas transmission and distribution
businesses, and merchant electric generation businesses in
Missouri and Illinois. Dividends on Ameren’s common
stock and the payment of other expenses by Ameren
depend on distributions made to it by its subsidiaries.
Ameren’s principal subsidiaries are listed below. Also see
the Glossary of Terms and Abbreviations at the front of this
report.
‰
‰
‰
Union Electric Company, or Ameren Missouri, operates
a rate-regulated electric generation, transmission and
distribution business, and a rate-regulated natural gas
transmission and distribution business in Missouri.
Ameren Missouri was incorporated in Missouri in 1922
and is successor to a number of companies, the oldest
of which was organized in 1881. It is the largest electric
utility in the state of Missouri. It supplies electric and
natural gas service to a 24,000-square-mile area in
central and eastern Missouri. This area has an
estimated population of 2.9 million and includes the
Greater St. Louis area. Ameren Missouri supplies
electric service to 1.2 million customers and natural
gas service to 127,000 customers.
Ameren Illinois Company, or Ameren Illinois, operates a
rate-regulated electric and natural gas transmission and
distribution business in Illinois. Ameren Illinois was
created by the merger of CILCO and IP with and into
CIPS. CIPS was incorporated in Illinois in 1923 and is
successor to a number of companies, the oldest of
which was organized in 1902. Ameren Illinois supplies
electric and natural gas utility service to portions of
central and southern Illinois having an estimated
population of 3.1 million in an area of 40,000 square
miles. Ameren Illinois supplies electric service to
1.2 million customers and natural gas service to
809,000 customers.
AER consists of non-rate-regulated operations,
including Genco, AERG, Marketing Company and
Medina Valley. The Medina Valley energy center was
sold in February 2012. Genco operates a merchant
electric generation business in Illinois and holds an
80% ownership interest in EEI, which it consolidates
for financial reporting purposes. Genco was
incorporated in Illinois in March 2000. Genco’s coal
and natural gas electric generating facilities are
expected to have capacity of 3,095 and 1,348
megawatts, respectively, at the time of the 2012 peak
summer electrical demand.
Ameren has various other subsidiaries responsible for
activities such as the provision of shared services.
On October 1, 2010, Ameren, CIPS, CILCO, IP, AERG
and AER completed a two-step corporate internal
reorganization. The first step of the reorganization was the
Ameren Illinois Merger. Upon consummation of the Ameren
Illinois Merger, the separate legal existence of CILCO and IP
ended. The second step of the reorganization involved the
distribution of AERG stock from Ameren Illinois to Ameren
and the subsequent contribution by Ameren of the AERG
stock to AER. The Ameren Illinois Merger and the
distribution of AERG stock were accounted for as
transactions between entities under common control. In
accordance with authoritative accounting guidance, assets
and liabilities transferred between entities under common
control were accounted for at the historical cost basis of the
common parent, Ameren, as if the transfer had occurred at
the beginning of the earliest reporting period presented.
Ameren’s historical cost basis in Ameren Illinois included
purchase accounting adjustments related to Ameren’s
acquisition of CILCORP in 2003. Ameren Illinois accounted
for the AERG distribution as a spinoff. Ameren Illinois
transferred AERG to Ameren based on AERG’s carrying
value. Ameren Illinois has segregated AERG’s operating
results and cash flows and presented them separately as
discontinued operations in its consolidated statement of
income and consolidated statement of cash flows,
respectively, for all periods presented prior to October 1,
2010, in this report. For Ameren’s financial statements,
AERG’s results of operations remain classified as
continuing operations. See Note 16 – Corporate
Reorganization and Discontinued Operations for additional
information.
Effective January 1, 2010, as part of an internal
reorganization, AER transferred its 80% stock ownership
interest in EEI to Genco through a capital contribution. The
transfer of EEI to Genco was accounted for as a transaction
between entities under common control, whereby Genco
accounted for the transfer at the historical carrying value of
the parent (Ameren) as if the transfer had occurred at the
beginning of the earliest reporting period presented.
Ameren’s historical cost basis in EEI included purchase
accounting adjustments relating to Ameren’s acquisition of
an additional 20% ownership interest in EEI in 2004. This
transfer required Genco’s prior-period financial statements
to be retrospectively combined for all periods presented.
Consequently, Genco’s prior-period consolidated financial
statements reflect EEI as if it had been a subsidiary of
Genco. Ameren and Genco consolidate EEI for financial
reporting purposes.
97
The financial statements of Ameren, Ameren Illinois
and Genco are prepared on a consolidated basis. Ameren
Missouri has no subsidiaries, and therefore its financial
statements were not prepared on a consolidated basis. All
significant intercompany transactions have been eliminated.
All tabular dollar amounts are in millions, unless otherwise
indicated.
Our accounting policies conform to GAAP. Our
financial statements reflect all adjustments (which include
normal, recurring adjustments) that are necessary, in our
opinion, for a fair presentation of our results. The
preparation of financial statements in conformity with GAAP
requires that Ameren management make certain estimates
and assumptions. Such estimates and assumptions affect
reported amounts of assets and liabilities, the disclosure of
contingent assets and liabilities at the dates of financial
statements, and the reported amounts of revenues and
expenses during the reported periods. Actual results could
differ from those estimates.
During the second quarter of 2011, Genco identified an
error in the cash flow statement classification of a capital
contribution from Ameren that affected Genco’s year ended
December 31, 2010. For the year ended December 31,
2010, Genco’s previously reported cash flows provided by
operating activities were $280 million, and cash flows used
in financing activities were $251 million. As corrected
herein, Genco’s cash flows provided by operating activities
were $304 million and cash flows used in financing
activities were $275 million. This correction had no impact
on Ameren’s previously reported consolidated statement of
cash flows.
Regulation
Certain Ameren subsidiaries are regulated by the
MoPSC, the ICC, and FERC. In accordance with
Materials and Supplies
authoritative accounting guidance regarding accounting for
the effects of certain types of regulation, Ameren Missouri
and Ameren Illinois defer certain costs as assets pursuant
to actions of rate regulators or based on the expectation
they will be able to recover such costs in rates charged to
customers. Ameren Missouri and Ameren Illinois also defer
certain amounts as liabilities pursuant to actions of rate
regulators or based on the expectation that such amounts
will be returned to customers in future rates. Regulatory
assets and liabilities are amortized consistent with the
period of expected regulatory treatment. See Note 2 – Rate
and Regulatory Matters for additional information on
regulatory assets and liabilities. In addition, other costs that
Ameren Missouri and Ameren Illinois expect to recover
from customers are recorded as construction work in
progress and property and plant, net. See Note 3 – Property
and Plant, Net.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand and
temporary investments purchased with an original maturity
of three months or less.
Allowance for Doubtful Accounts Receivable
The allowance for doubtful accounts represents our
best estimate of existing accounts receivable that will
ultimately be uncollectible. The allowance is calculated by
applying estimated loss factors to various classes of
outstanding receivables, including unbilled revenue. The
loss factors used to estimate uncollectible accounts are
based upon both historical collections experience and
management’s best estimate of future collections success
given the existing and anticipated future collections
environment. Ameren Illinois has a rate mechanism that
adjusts rates for bad debt expense above or below those
being collected in rates.
Materials and supplies are recorded at the lower of cost or market. Cost is determined using the average-cost method.
Materials and supplies are capitalized as inventory when purchased and then expensed or capitalized as plant assets when
installed, as appropriate. The following table presents a breakdown of materials and supplies for each of the Ameren
Companies at December 31, 2011, and 2010:
2011:
Fuel(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gas stored underground . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other materials and supplies . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
Fuel(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gas stored underground . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other materials and supplies . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren(a)
Ameren Missouri
Ameren Illinois
Genco
$
$
$
$
251
171
290
712
255
175
277
707
$
$
$
$
150
22
176
348
152
22
167
341
$
$
$
$
-
149
50
199
-
152
46
198
$
$
$
$
76
-
46
122
81
-
49
130
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
(a)
(b) Consists of coal, oil, paint, propane, and tire chips.
98
Property and Plant
We capitalize the cost of additions to and betterments
of units of property and plant. The cost includes labor,
material, applicable taxes, and overhead. An allowance for
funds used during construction, as discussed specifically
below, is also capitalized as a cost of our rate-regulated
assets. Interest incurred during construction is capitalized
as a cost of merchant generation assets. Maintenance
expenditures, including nuclear refueling and maintenance
outages, are expensed as incurred. When units of
depreciable property are retired, the original costs, less
salvage values, are charged to accumulated depreciation.
Asset removal costs incurred by our merchant generation
operations that do not constitute legal obligations are
expensed as incurred. Asset removal costs accrued by our
rate-regulated operations that do not constitute legal
obligations are classified as a regulatory liability. See Asset
Retirement Obligations below and Note 3 – Property and
Plant, Net, for additional information.
Depreciation
Depreciation is provided over the estimated lives of the
various classes of depreciable property by applying
composite rates on a straight-line basis to the cost basis of
such property. The provision for depreciation for the
Ameren Companies in 2011, 2010 and 2009 ranged from
3% to 4% of the average depreciable cost.
Allowance for Funds Used During Construction
In our rate-regulated operations, we capitalize the
allowance for funds used during construction, or the cost of
borrowed funds and the cost of equity funds (preferred and
common stockholders’ equity) applicable to rate-regulated
construction expenditures, as is the utility industry
accounting practice. Allowance for funds used during
construction does not represent a current source of cash
funds. This accounting practice offsets the effect on
earnings of the cost of financing current construction, and it
treats such financing costs in the same manner as
construction charges for labor and materials.
Under accepted ratemaking practice, cash recovery of
allowance for funds used during construction and other
construction costs occurs when completed projects are
placed in service and reflected in customer rates. The
following table presents the annual allowance for funds
used during construction rates that were utilized during
2011, 2010 and 2009:
Ameren . . . . . . . . . .
Ameren Missouri . . .
Ameren Illinois . . . .
2011
2010
2009
8% - 9%
8% - 9%
6% - 9%
8
9
8
9
6
9
Goodwill and Intangible Assets
Goodwill. Goodwill represents the excess of the
purchase price of an acquisition over the fair value of the
net assets acquired. As of December 31, 2011, Ameren’s
and Ameren Illinois’ goodwill related to Ameren’s
acquisition of IP in 2004 and Ameren’s acquisition of
CILCORP in 2003.
We evaluate goodwill for impairment as of October 31
of each year, or more frequently if events or changes in
circumstances indicate that the asset might be impaired.
During the fourth quarter of 2011, Ameren and Ameren
Illinois used a qualitative evaluation to assess the likelihood
of a goodwill impairment based on authoritative accounting
guidance issued by the FASB in 2011. That evaluation led
Ameren and Ameren Illinois to believe it was more likely
than not that the fair value of each of their reporting units
exceeded their carrying values, resulting in no impairment
in 2011. See Note 17 – Goodwill, Impairment and Other
Charges for additional information including the goodwill
impairment recorded in 2010.
Intangible Assets. Ameren, Ameren Missouri and
Genco classify emission allowances and renewable energy
credits as intangible assets. We evaluate intangible assets
for impairment if events or changes in circumstances
indicate that their carrying amount might be impaired. See
Note 17 – Goodwill, Impairment and Other Charges for
additional information including the intangible asset
impairments recorded in 2011 and 2010.
At December 31, 2011, Ameren’s and Ameren
Missouri’s intangible assets included renewable energy
credits obtained through wind and solar power purchase
agreements. The book value of each of Ameren’s and
Ameren Missouri’s renewable energy credits was $7 million
and less than $1 million at December 31, 2011, and 2010,
respectively.
In July 2011, the EPA issued the CSAPR, which
created new allowances for SO2 and NOx emissions, and
restricted the use of preexisting SO2 and NOx allowances to
the acid rain program and NOx budget trading program,
respectively. In anticipation of the CSAPR announcement,
observable market prices for existing emission allowances
declined materially. Consequently, during 2011, Ameren
and Genco recorded a noncash, pretax impairment charge
of $2 million and $1 million, respectively, which was
reflected in “Goodwill, impairment and other charges” on
their statements of income. Ameren Missouri recorded a
$1 million impairment of its SO2 emission allowances by
reducing a previously established regulatory liability relating
to the SO2 emission allowances, which had no impact to
earnings. On December 30, 2011, the United States Court
of Appeals for the District of Columbia issued a stay of the
CSAPR. Until that court proceeding is finalized, the EPA is
expected to continue to administer the CAIR and to use
CAIR’s allowance program for compliance. During 2010,
Ameren and Genco each recognized an impairment charge
of intangible assets to reduce the carrying value of SO2
emission allowances. The charge was reflected in
“Goodwill, impairment and other charges” in their
statements of income. See Note 15 – Commitments and
Contingencies for additional information on emission
99
allowances and the CSAPR. The book value of each of
Ameren’s, Ameren Missouri’s, and Genco’s CAIR emission
allowances was less than $1 million at December 31, 2011.
The book value of Ameren’s, Ameren Missouri’s, and
Genco’s CAIR emission allowances was $7 million,
$2 million, and $3 million, at December 31, 2010,
respectively.
Renewable energy credits and emission allowances are
charged to purchased power expense and fuel expense,
respectively, as they are used in operations. The following
table presents amortization expense based on usage of
renewable energy credits and emission allowances, net of
gains from sales, for Ameren, Ameren Missouri, Ameren
Illinois, and Genco during the years ended December 31,
2011, 2010, and 2009. The table below does not include the
intangible asset impairment charges referenced above.
Environmental Costs
Liabilities for environmental costs are recorded on an
undiscounted basis when it is probable that a liability has
been incurred and the amount of the liability can be
reasonably estimated. Costs are expensed or deferred as a
regulatory asset when it is expected that the costs will be
recovered from customers in future rates. If environmental
expenditures are related to facilities currently in use, such
as pollution control equipment, the cost is capitalized and
depreciated over the expected life of the asset.
Unamortized Debt Discount, Premium, and Expense
Discount, premium, and expense associated with long-
term debt are amortized over the lives of the related issues.
2010
2009
Revenue
Ameren Missouri
. . . . . . . .
Ameren Illinois . . . . . . . . . .
Genco(b) . . . . . . . . . . . . . . .
. . . . . . . . . . . . . .
Other(b)(c)
Ameren(b) . . . . . . . . . . . . . .
2011
$ (a)
3
2
1
$
6
$
$
6
7
18
4
35
$
$
2
9
24
5
40
Operating Revenues
Ameren Missouri, Ameren Illinois and Genco record
operating revenue for electric or natural gas service when it
is delivered to customers. We accrue an estimate of electric
and natural gas revenues for service rendered but unbilled
at the end of each accounting period.
Trading Activities
We present the revenues and costs associated with
certain energy derivative contracts designated as trading on
a net basis in “Operating Revenues – Electric” and
“Operating Revenues – Other.”
Nuclear Fuel
Ameren Missouri’s cost of nuclear fuel is capitalized
and then amortized to fuel expense on a unit-of-production
basis. Spent fuel disposal cost is based on net
kilowatthours generated and sold, and that cost is charged
to expense.
Purchased Gas, Power and Fuel Rate-adjustment
Mechanisms
Ameren’s utility subsidiaries have various rate-
adjustment mechanisms in place that provide for the
recovery of purchased natural gas and electric fuel and
purchased power costs. See Note 2 – Rate and Regulatory
Matters for the regulatory assets and liabilities recorded at
December 31, 2011, and 2010, related to the rate-
adjustment mechanisms discussed below.
In Ameren Missouri’s and Ameren Illinois’ retail natural
gas utility jurisdictions, changes in natural gas costs are
generally reflected in billings to their natural gas utility
customers through PGA clauses. The difference between
actual natural gas costs and costs billed to customers in a
given period are deferred as regulatory assets or liabilities.
The deferred amounts are either billed or refunded to
natural gas utility customers in a subsequent period.
(a) Less than $1 million.
(b)
Includes allowances consumed that were recorded through
purchase accounting.
(c) Consists of renewable energy credit expense for Marketing
Company and emission allowances expense for AERG.
Impairment of Long-lived Assets
We evaluate long-lived assets classified as held and
used for impairment when events or changes in
circumstances indicate that the carrying value of such
assets may not be recoverable. Whether impairment has
occurred is determined by comparing the estimated
undiscounted cash flows attributable to the assets with the
carrying value of the assets. If the carrying value exceeds
the undiscounted cash flows, we recognize an impairment
charge equal to the carrying value of the assets in excess of
estimated fair value. In the period in which we determine an
asset meets the held for sale criteria, we record an
impairment charge to the extent the book value exceeds its
fair value less cost to sell. See Note 17 – Goodwill,
Impairment and Other Charges for information about
Ameren’s, Ameren Missouri’s and Genco’s impairments.
Investments
Ameren and Ameren Missouri evaluate for impairment
the investments held in Ameren Missouri’s nuclear
decommissioning trust fund. Losses on assets in the trust
fund could result in higher funding requirements for
decommissioning costs, which Ameren Missouri believes
would be recovered in electric rates paid by its customers.
Accordingly, Ameren and Ameren Missouri recognize a
regulatory asset on their balance sheets for losses on
investments held in the nuclear decommissioning trust
fund. See Note 9 – Nuclear Decommissioning Trust Fund
Investments for additional information.
100
In Ameren Illinois’ retail electric utility jurisdictions,
changes in purchased power costs are generally reflected in
billings to their electric utility customers through pass-
through rate-adjustment clauses. The difference between
actual purchased power costs and costs billed to customers
in a given period are deferred as regulatory assets or
liabilities. The deferred amounts are either billed or
refunded to electric utility customers in a subsequent
period.
Ameren Missouri has a FAC that allows an adjustment
of electric rates three times per year for a pass-through to
customers of 95% of changes in fuel, emission allowances
and purchased power costs, net of off-system revenues,
including MISO costs and revenues, greater or less than the
amount set in base rates, subject to MoPSC prudency
review. The differences between the cost of fuel incurred
and the cost of fuel recovered from Ameren Missouri’s
customers are deferred as regulatory assets or liabilities.
The deferred amounts are either billed or refunded to
Ameren Missouri’s electric utility customers in a
subsequent period.
Accounting for MISO Transactions
MISO-related purchase and sale transactions are
recorded by Ameren, Ameren Missouri and Ameren Illinois
using settlement information provided by MISO.
These purchase and sale transactions are accounted for on
a net hourly position. We record net purchases in a single
hour in “Operating Expenses – Purchased power” and net
sales in a single hour in “Operating Revenues – Electric” in
our statements of income. On occasion, prior-period
transactions will be resettled outside the routine settlement
process because of a change in MISO’s tariff or a material
interpretation thereof. In these cases, Ameren, Ameren
Missouri and Ameren Illinois recognize expenses associated
with resettlements once the resettlement is probable and
the resettlement amount can be estimated.
Stock-based Compensation
Stock-based compensation cost is measured at the
grant date based on the fair value of the award. Ameren
recognizes as compensation expense the estimated fair
value of stock-based compensation on a straight-line basis
over the requisite service period. See Note 12 – Stock-
based Compensation for additional information.
Excise Taxes
Excise taxes imposed on us are reflected on Ameren
Missouri customer electric bills and on Ameren Missouri
and Ameren Illinois customer natural gas bills. They are
recorded gross in “Operating Revenues – Electric”,
“Operating Revenues – Gas” and “Operating Expenses –
Taxes other than income taxes” on the statement of income.
Excise taxes reflected on Ameren Illinois electric customer
bills are imposed on the consumer and are therefore not
included in revenues and expenses. They are recorded as
tax collections payable and included in “Taxes accrued” on
the balance sheet. The following table presents excise taxes
recorded in “Operating Revenues – Electric”, “Operating
Revenues – Gas” and “Operating Expenses – Taxes other
than income taxes” for the years ended 2011, 2010 and
2009:
2011
2010
2009
Ameren Missouri . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . .
$
$
137
57
194
$
$
130
59
189
$
$
112
56
168
Income Taxes
Ameren uses an asset and liability approach for its
financial accounting and reporting of income taxes, in
accordance with authoritative accounting guidance.
Deferred tax assets and liabilities are recognized for
transactions that are treated differently for financial
reporting and income tax return purposes. These deferred
tax assets and liabilities are based on statutory tax rates.
We recognize that regulators will probably reduce
future revenues for deferred tax liabilities that were initially
recorded at rates in excess of the current statutory rate.
Therefore, reductions in the deferred tax liability, which
were recorded because of decreases in the statutory rate,
have been credited to a regulatory liability. A regulatory
asset has been established to recognize the probable
recovery in rates of future income taxes, resulting
principally from the reversal of allowance for funds used
during construction. This refers to equity and temporary
differences related to property and plant acquired before
1976 that were unrecognized temporary differences prior to
the adoption of the authoritative accounting guidance for
income taxes.
Investment tax credits used on tax returns for prior
years have been deferred for book purposes; the credits are
being amortized over the useful lives of the related
investment. Deferred income taxes were recorded on the
temporary difference represented by the deferred
investment tax credits and a corresponding regulatory
liability. This recognizes the expected reduction in rate
revenue for future lower income taxes associated with the
amortization of the investment tax credits. See Note 13 –
Income Taxes.
Ameren Missouri, Ameren Illinois and Genco are
parties to a tax sharing agreement with Ameren that
provides for the allocation of consolidated tax liabilities. The
tax sharing agreement specifies that each party be allocated
an amount of tax similar to that which would be owed had
the party been separately subject to tax. Any net benefit
attributable to the parent is reallocated to other members.
That allocation is treated as a contribution of capital to the
party receiving the benefit.
Noncontrolling Interests
Ameren’s noncontrolling interests comprised the 20%
of EEI not owned by Ameren and the preferred stock not
subject to mandatory redemption of Ameren’s subsidiaries.
101
These noncontrolling interests are classified as a
component of equity separate from Ameren’s equity in its
consolidated balance sheet. Genco’s noncontrolling interest
comprised the 20% of EEI not owned by Genco. This
noncontrolling interest is classified as a component of
equity separate from Genco’s equity in its consolidated
balance sheet.
Earnings per Share
There were no material differences between Ameren’s
basic and diluted earnings per share amounts in 2011,
2010, and 2009. The number of stock options, restricted
stock shares, and performance share units outstanding was
immaterial. There were no assumed stock option
conversions in 2009 and 2010, as the remaining stock
options were not dilutive. All of Ameren’s stock options
expired in February 2010.
Accounting Changes and Other Matters
The following is a summary of recently adopted
authoritative accounting guidance as well as guidance
issued but not yet adopted that could impact the Ameren
Companies.
Disclosures about an Employer’s Participation in a
Multiemployer Plan
In September 2011, FASB amended its guidance to
require employers to provide additional disclosures for
multiemployer pension plans and multiemployer other
postretirement benefit plans. This guidance was applicable
to Ameren Missouri, Ameren Illinois, and Genco because
they participate in their parent’s (Ameren’s) benefit plans.
Ameren Missouri, Ameren Illinois, and Genco adopted this
guidance as of December 31, 2011. See Note 11 –
Retirement Benefits for the required additional disclosures
made by Ameren Missouri, Ameren Illinois and Genco,
including the amount of their contributions to Ameren’s
benefit plans.
Testing of Goodwill for Impairment
In September 2011, FASB amended its guidance on
testing of goodwill impairment. The amended guidance
provided companies the option to first assess qualitative
factors to determine whether it is more likely than not that
the fair value of a reporting unit is less than its carrying
amount as a basis for determining whether it is necessary
to perform a two-step goodwill impairment test. As
permitted, Ameren and Ameren Illinois early adopted the
amended guidance for the annual goodwill impairment test
performed as of October 31, 2011. See Note 17 – Goodwill,
Impairment and Other Charges for additional information.
Disclosures about Fair Value Measurements
See Note 8 – Fair Value Measurements for adopted
guidance on fair value measurements issued in January
2010, which became effective in its entirety for the Ameren
Companies as of January 1, 2011.
In May 2011, FASB issued additional authoritative
guidance regarding fair value measurements. The guidance
amends the disclosure requirements for fair value
measurements in order to align the principles for fair value
measurements and the related disclosure requirements
under GAAP and International Financial Reporting
Standards. The amendments will not affect the Ameren
Companies’ results of operations, financial positions, or
liquidity, as this guidance only requires additional
disclosures. This guidance will be effective for the Ameren
Companies beginning in the first quarter of 2012 with
retrospective application required.
Presentation of Comprehensive Income
In June 2011, FASB amended its guidance on the
presentation of comprehensive income in financial
statements. The amended guidance will not affect the
Ameren Companies’ results of operations, financial
positions, or liquidity. The amended guidance changes the
presentation of comprehensive income in the financial
statements. It requires entities to report components of
comprehensive income either in a continuous statement of
comprehensive income or in two separate but consecutive
statements. This guidance will be effective for the Ameren
Companies beginning in the first quarter of 2012. In
December 2011, the FASB amended the guidance to
postpone a requirement to present reclassification
adjustments by income component until further guidance is
issued.
Asset Retirement Obligations
Authoritative accounting guidance requires us to
record the estimated fair value of legal obligations
associated with the retirement of tangible long-lived assets
in the period in which the liabilities are incurred and to
capitalize a corresponding amount as part of the book value
of the related long-lived asset. In subsequent periods, we
are required to make adjustments to AROs based on
changes in the estimated fair values of the obligations.
Corresponding increases in asset book values are
depreciated over the remaining useful life of the related
asset. Uncertainties as to the probability, timing, or amount
of cash flows associated with AROs affect our estimates of
fair value. Ameren, Ameren Missouri and Genco have
recorded AROs for retirement costs associated with Ameren
Missouri’s Callaway energy center decommissioning costs,
asbestos removal, ash ponds, and river structures. In
addition, Ameren, Ameren Missouri and Ameren Illinois
have recorded AROs for the disposal of certain
transformers.
Asset removal costs accrued by our rate-regulated
operations that do not constitute legal obligations are
classified as a regulatory liability. See Note 2 – Rate and
Regulatory Matters.
102
The following table provides a reconciliation of the beginning and ending carrying amount of AROs for the years 2011 and
2010:
Ameren
Missouri(a)
Ameren
Illinois(b)
Genco
AERG
Ameren(a)
Balance at December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities settled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accretion in 2010(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in estimates(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
331
5
(4)
19
12
Balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
363
Liabilities incurred . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities settled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accretion in 2011(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in estimates(f)
-
(1)
20
(54)
$
$
5
(c)
(c)
1
(3)
3
-
(c)
(c)
(c)
$
65
3
(c)
4
2
$
33
-
(c)
2
(c)
$
74
$
35
(c)
(2)
5
(6)
-
(c)
2
(6)
$ 434
8
(4)
26
11
$ 475
(c)
(3)
27
(66)
Balance at December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
328
$
3
$
71(g)
$
31
$
433(g)
(a) The nuclear decommissioning trust fund assets of $357 million and $337 million as of December 31, 2011, and 2010, respectively, were
restricted for decommissioning of the Callaway energy center.
(b) Balance included in “Other deferred credits and liabilities” on the balance sheet.
(c) Less than $1 million.
(d) Accretion expense was recorded as an increase to regulatory assets at Ameren Missouri and Ameren Illinois.
(e) Ameren Missouri and Genco changed their estimates for asbestos removal. Additionally, Genco changed the estimates related to retirement
costs for its coal combustion byproduct storage areas.
(f) Ameren Missouri changed estimates related to its Callaway energy center decommissioning costs because of a cost study performed in 2011
and a decline in the cost escalation factor assumptions. Additionally, Ameren Missouri, Genco and AERG changed estimates related to
retirement costs for asbestos removal, river structures and their coal combustion byproduct storage areas.
(g) Balance included $5 million in “Other current liabilities” on the balance sheet as of December 31, 2011.
Genco Asset Sale
In June 2010, Genco completed a sale of 25% of its
Columbia CT energy center to the city of Columbia,
Missouri. Genco received cash proceeds of $18 million and
recognized a $5 million pretax gain from the sale.
In June 2011, Genco completed the sale of its
remaining interest in the Columbia CT energy center to the
city of Columbia, Missouri. Genco received cash proceeds
of $45 million and recognized an $8 million pretax gain
from the sale. Effective with the sale, the power purchase
agreements between Marketing Company and the city of
Columbia were terminated. Also in 2011, Genco sold
additional property and assets for cash proceeds of
$4 million, which resulted in pretax gains of $4 million.
Medina Valley Sale in 2012
In February 2012, Ameren completed the asset sale of
its Medina Valley energy center’s net property and plant for
cash proceeds of $16 million and an additional $1 million
payment at the two-year anniversary date of the sale if there
are no violations of representations and warranties
contained in the sale agreement.
Employee Separation and Other Charges
During the fourth quarter of 2011, as part of efforts to
reduce operations and maintenance expenses, Ameren
Missouri and Ameren Services extended voluntary
separation offers consistent with Ameren’s standard
management separation program to eligible management
103
and labor union-represented employees. Approximately 340
employees of Ameren Missouri and Ameren Services
accepted the offers and left their employment by
December 31, 2011. Ameren and Ameren Missouri
recorded a pretax charge to earnings of $28 million and
$27 million, respectively, for the severance costs related to
these offers. These charges were recorded in “Other
operations and maintenance expense” in each company’s
statement of income for the year ended December 31,
2011. Substantially all of the severance costs will be paid in
the first quarter of 2012 and were recorded in “Accounts
and wages payable” on each company’s balance sheet at
December 31, 2011. The severance costs related to
participating Ameren Services employees were allocated to
affiliates consistent with the terms of its support services
agreement, which is described in Note 14 – Related Party
Transactions.
Also during 2011, Genco ceased operations of its
Meredosia and Hutsonville energy centers. The closure of
these energy centers at the end of 2011 resulted in the
elimination of 90 positions. Ameren and Genco each
recorded a $4 million pretax charge for related severance
and relocation costs to “Goodwill, impairment and other
charges” in their statements of income for the year ended
December 31, 2011. The severance costs will be
substantially paid during the first quarter of 2012 and were
accrued in “Accounts and wages payable” on each
company’s balance sheet at December 31, 2011. See
Note 17 – Goodwill, Impairment and Other Charges for
additional information.
In 2010, Ameren’s Merchant Generation segment
initiated an involuntary separation program to reduce
positions under the terms and benefits consistent with
Ameren’s standard management separation program.
Ameren and Genco recorded a pretax charge to earnings of
$4 million in 2010 for the severance costs related to this
program. These charges were recorded in “Other operations
and maintenance expense” on Ameren’s and Genco’s
consolidated statement of income.
In 2009, Ameren initiated voluntary and involuntary
separation programs under terms and benefits consistent
with Ameren’s standard management severance
program. Ameren recorded a pretax charge to earnings of
$17 million (Ameren Missouri – $8 million,
Ameren Illinois – $3 million, Genco – $5 million) for the
severance costs related to both the voluntary and
involuntary separation programs. These charges were
recorded in “Other operations and maintenance expense” in
each company’s statement of income. The number of
positions eliminated as a result of these separation
programs was approximately 300. In its May 2010 electric
rate order, the MoPSC allowed Ameren Missouri to recover
the costs of this severance program from its customers.
Therefore, in 2010 Ameren Missouri reclassified the 2009
“Other operations and maintenance expense” to
“Regulatory assets.” In addition to these programs, Genco
recorded a $4 million pretax charge to 2009 earnings in
connection with the retirement of two generating units at its
Meredosia energy center and for related obsolete inventory.
NOTE 2 – RATE AND REGULATORY MATTERS
Below is a summary of significant regulatory
proceedings and related lawsuits. We are unable to predict
the ultimate outcome of these matters, the timing of the
final decisions of the various agencies and courts, or the
impact on our results of operations, financial position, or
liquidity.
Missouri
2009 Electric Rate Order
In February 2009, Noranda, Ameren Missouri’s largest
electric customer, and the MoOPC appealed certain aspects
of the MoPSC’s 2009 electric rate order to the Circuit Court
of Stoddard County, Missouri. In September 2009, the
Stoddard County Circuit Court granted Noranda’s request to
stay the electric rate increase granted by the January 2009
MoPSC’s order as it applied specifically to Noranda’s
electric service account until the court rendered its decision
on the appeal. From the granting of the stay request until
June 2010, Noranda paid into the Stoddard County Circuit
Court’s registry the entire amount of its monthly base rate
increase and monthly FAC payments. In June 2010, when
the May 2010 electric rate order became effective, Noranda
ceased making base rate payments into the Stoddard
County Circuit Court’s registry. Noranda continued to pay
into the Stoddard County Circuit Court’s registry its monthly
FAC payments related to electric service received during the
time periods prior to the effectiveness of the May 2010
electric rate order.
In August 2010, the Stoddard County Circuit Court
issued a judgment that reversed parts of the MoPSC’s
decision. However, upon issuance, the Stoddard County
Circuit Court suspended its own judgment. Ameren
Missouri filed an appeal of the Stoddard County Circuit
Court’s judgment with the Missouri Court of Appeals,
Southern District. In November 2011, the Missouri Court of
Appeals issued a ruling that upheld the MoPSC’s January
2009 electric rate order; thereby reversing the Stoddard
County Circuit Court’s August 2010 decision. As of
December 31, 2011, the amount held in the Stoddard
County Circuit Court’s registry was $20 million. That
amount was reflected in “Accounts receivable-trade” on
Ameren’s and Ameren Missouri’s balance sheets at
December 31, 2011. Ameren Missouri expects to receive all
of the funds held in the Stoddard County Circuit Court’s
registry relating to the stay during the first quarter of 2012.
2010 Electric Rate Order
In May 2010, the MoPSC issued an order approving an
increase for Ameren Missouri in annual revenues for
electric service of $230 million.
The MIEC and MoOPC appealed certain aspects of the
MoPSC order to the Cole County Circuit Court. In addition
to the MIEC appeal, four industrial customers, who are
members of MIEC, also filed a request for a stay with the
Cole County Circuit Court. In December 2010, the Cole
County Circuit Court granted the request of the four
industrial customers to stay the MoPSC’s 2010 electric rate
order and required those customers to pay into the Cole
County Circuit Court’s registry the difference between their
billings under the 2010 Missouri electric rate order and their
billings under a Missouri electric rate order that became
effective in June 2007, which was, at that time, the last
Ameren Missouri rate order for which appeals had been
exhausted. In February 2011, the four industrial customers
posted the bond required by the stay. Since the bond was
posted, the four industrial customers have made payments
into the Cole County Circuit Court’s registry equal to the
difference between their base rate billings under 2010
electric rates and 2007 electric rates, as well as their FAC
amounts to the extent those billings relate to service prior
to the effective date of the new rates established by the
2011 electric rate order. Because of the lag between
accumulations of changes in net fuel costs and the time
those net fuel costs are recovered through FAC charges
applied to customers’ bills, the four industrial customers
will continue to pay a portion of their FAC payments to the
Cole County Circuit Court’s registry for service prior to the
effective date of the new rates by the 2011 electric rate
order. It is expected that a portion of the FAC billings
invoiced to these customers in September 2012 would be
the last contested amount deposited into the Cole County
Circuit Court’s registry relating to this 2010 electric rate
order appeal, pending resolution of the appeal. As of
December 31, 2011, the amount held by the Cole County
104
Circuit Court, excluding the bond amount, was $15 million.
This amount held in the registry was reflected in “Accounts
receivable-trade” on Ameren’s and Ameren Missouri’s
balance sheets at December 31, 2011.
A Cole County Circuit Court decision is expected
during the first quarter of 2012 on the MIEC’s and MoOPC’s
appeal. We cannot predict the ultimate outcome of this
proceeding, which could have a material effect on Ameren’s
and Ameren Missouri’s results of operations, financial
position, and liquidity. If the MoPSC’s 2010 electric rate
order is ultimately upheld, Ameren Missouri will receive all
of the funds held in the Cole County Circuit Court’s registry,
plus accrued interest. If Ameren Missouri were to conclude
that some portion of the rate increase resulting from the
2010 electric rate order was probable of refund to Ameren
Missouri’s customers, a charge to earnings would be
recorded for the estimated amount of refund in the period in
which that determination was made. At this time, Ameren
Missouri does not believe any aspect of the 2010 MoPSC’s
electric rate order is probable of refund to Ameren
Missouri’s customers. Therefore, no reserve has been
established.
2011 Electric Rate Order
In July 2011, the MoPSC issued an order approving an
increase for Ameren Missouri in annual revenues for
electric service of $173 million, including $52 million
related to an increase in normalized net fuel costs above the
net fuel costs included in base rates previously authorized
by the MoPSC in its 2010 electric rate order. The revenue
increase was based on a 10.2% return on equity, a capital
structure composed of 52.2% common equity, and a rate
base of $6.6 billion. The rate changes became effective on
July 31, 2011. The MoPSC order approved the continued
use of Ameren Missouri’s vegetation management and
infrastructure cost tracker, its pension and postretirement
benefit cost tracker, and the FAC at the current 95% sharing
level. The MoPSC order shortened the FAC recovery and
refund period from 12 months to eight months. The MoPSC
order denied Ameren Missouri’s request for the ability to
recover any under-recovery of fixed costs as a result of
lower sales volumes from the implementation of energy
efficiency measures.
Additionally, the MoPSC order provided for a tracking
mechanism for uncertain income tax positions. The order
provides that reserves for uncertain income tax positions do
not reduce rate base. However, when an uncertain income tax
position liability is resolved, the order requires the creation of
a regulatory asset or regulatory liability to reflect the time
value (using the weighted-average cost of capital in the order)
of the difference between the uncertain income tax position
liability that was excluded from rate base and the final tax
liability. The resulting regulatory asset or liability will be
amortized over three years beginning on the effective date of
new rates established in the next electric rate case.
The MoPSC order disallowed the recovery of all costs
of enhancements, or costs that would have been incurred
absent the breach, related to the rebuilding of the Taum
Sauk energy center in excess of amounts recovered from
property insurance. As a result of the order, Ameren and
Ameren Missouri each recorded in 2011 a pretax charge to
earnings of $89 million relating to the Taum Sauk
disallowance. This charge was recorded in Ameren’s
statement of income as “Goodwill, impairment and other
charges” and recorded in Ameren Missouri’s statement of
income as “Loss from regulatory disallowance.”
In July 2011, a new law that reformed the judicial
appeal process for MoPSC rate orders took effect. Among
other items, the new law allows appeals to bypass the
circuit court and to be made directly to the appellate court.
The new law provides that rates cannot be stayed; however,
the appellate court could direct the MoPSC to revise rates.
Such rate revisions could be ordered to be applied
retroactively. This new law applied to judicial appeals of the
MoPSC’s July 2011 rate order.
In August 2011, Ameren Missouri appealed the
disallowance of Taum Sauk enhancements to the Missouri
Court of Appeals, Western District. A decision is expected
by the Missouri Court of Appeals, Western District, in 2012.
Ameren Missouri cannot predict the ultimate outcome of its
appeal.
Pending Electric Rate Case
On February 3, 2012, Ameren Missouri filed a request
with the MoPSC to increase its annual revenues for electric
service by $376 million. Included in this requested increase
is a $103 million increase in normalized net fuel costs
above the net fuel costs included in base rates previously
authorized by the MoPSC in its July 2011 electric rate
order. Absent initiation of this general rate proceeding, 95%
of this amount would have been reflected in rate
adjustments implemented under Ameren Missouri’s FAC.
Approximately $85 million of the request relates to
investments to improve the reliability of Ameren Missouri’s
infrastructure and to comply with environmental and
renewable energy regulations, including the requested
return on such investments, and $81 million of the request
relates to recovery of the costs associated with energy
efficiency programs under the MEEIA, including energy
efficiency investments, which is discussed below. The
electric rate increase request was based on a 10.75% return
on equity, a capital structure composed of 52% common
equity, an aggregate electric rate base of $6.8 billion, and a
test year ended September 30, 2011, with certain pro forma
adjustments expected through the anticipated true-up date
of July 31, 2012.
As part of its filing, Ameren Missouri requested that
the MoPSC approve the implementation of a storm cost
tracking mechanism, as well as plant-in-service accounting
treatment. The proposed storm cost tracking mechanism
would allow Ameren Missouri to record a regulatory asset
or liability, as applicable, reflecting the difference between a
base level of major storm restoration costs used to set rates
in the current rate case and the actual storm restoration
costs, and to request recovery of such regulatory asset or
105
liability in Ameren Missouri’s next rate case for amortization
over a three-year period. The plant-in-service accounting
treatment would permit Ameren Missouri to recover a
return and to defer depreciation expense on assets placed in
service but not yet reflected in customer rates.
Ameren Missouri requested continued use of the FAC
and the regulatory tracking mechanisms for vegetation
management/infrastructure inspection costs, for pension
and postretirement benefits, and for uncertain income tax
positions that the MoPSC previously authorized in earlier
electric rate orders. Ameren Missouri also requested
recovery of the 2011 voluntary separation program
severance costs over three years.
A decision by the MoPSC in this proceeding is
expected in December 2012. Ameren Missouri cannot
predict the level of any electric service rate change the
MoPSC may approve, when any rate change may go into
effect, or whether any rate increase that may eventually be
approved will be sufficient for Ameren Missouri to recover
its costs and earn a reasonable return on its investments
when the increase goes into effect.
MEEIA Filing
The MEEIA, enacted in 2009, established a regulatory
framework that, among other things, allows electric utilities
to recover costs related to MoPSC-approved energy
efficiency programs. The law requires the MoPSC to ensure
that a utility’s financial incentives are aligned with helping
customers use energy more efficiently, to provide timely
cost recovery, and to provide earnings opportunities
associated with cost-effective energy efficiency programs.
Missouri does not have a law mandating energy efficiency
standards.
In January 2012, Ameren Missouri made its initial
filing with the MoPSC under the MEEIA. This filing
proposes a three-year plan that includes a portfolio of
energy efficiency programs along with a cost-recovery
mechanism. If the proposal is approved, beginning in
January 2013, Ameren Missouri plans to invest
$145 million over three years for the proposed energy
efficiency programs.
A decision by the MoPSC in this proceeding is
anticipated in the second quarter of 2012. The MoPSC’s
order in this proceeding will not affect Ameren Missouri
rates until these rates are included in an electric service rate
case. Ameren Missouri anticipates that the impacts of the
MoPSC’s decision in this MEEIA filing will be included in
rates set under its pending electric service rate case that
was filed on February 3, 2012, which has an anticipated
true-up date of July 31, 2012. Ameren Missouri’s pending
electric rate case includes an annual revenue increase of
$81 million relating to its planned portfolio of energy
efficiency programs included in its MEEIA filing.
FAC Prudence Review
Missouri law requires the MoPSC to complete
prudence reviews of Ameren Missouri’s FAC at least every
18 months. In April 2011, the MoPSC issued an order with
respect to its review of Ameren Missouri’s FAC for the
period from March 1, 2009, to September 30, 2009. In this
order, the MoPSC ruled that Ameren Missouri should have
included in the FAC calculation all revenues and costs
associated with certain long-term partial requirements sales
that were made by Ameren Missouri because of the loss of
Noranda’s load caused by a severe ice storm in January
2009. As a result of the order, Ameren Missouri recorded a
pretax charge to earnings of $18 million, including
$1 million for interest, in 2011 for its obligation to refund to
Ameren Missouri’s electric customers the earnings
associated with these sales previously recognized by
Ameren Missouri during the period from March 1, 2009, to
September 30, 2009. In October 2011, Ameren Missouri
began refunding the $18 million to customers through the
FAC.
Ameren Missouri disagrees with the MoPSC order’s
classification of these sales and believes that the terms of
its FAC tariff did not provide for the inclusion of these sales
in the FAC calculation. In June 2011, Ameren Missouri filed
an appeal with the Cole County Circuit Court. A decision is
expected from the Cole County Circuit Court in 2012.
Separately, in July 2011, Ameren Missouri filed a request
with the MoPSC for an accounting authority order that
would allow Ameren Missouri to defer, as a regulatory
asset, fixed costs totaling $36 million that were not
recovered from Noranda as a result of the loss of load
caused by the severe 2009 ice storm for potential recovery
in a future electric rate case. We cannot predict the ultimate
outcome of these regulatory or judicial proceedings.
Ameren Missouri recognized an additional $25 million
of pretax earnings associated with the same long-term
partial requirements sales contracts subsequent to
September 30, 2009, which were not addressed by the
MoPSC order issued in April 2011. The MoPSC’s FAC
review for the period from October 1, 2009, to May 31,
2011, was initiated in September 2011. In October 2011,
the MoPSC staff filed a recommendation with the MoPSC to
direct Ameren Missouri to refund to customers, prior to the
completion of the staff’s prudence review, the pretax
earnings associated with the same long-term partial
requirements sales contracts subsequent to September 30,
2009. The MoPSC staff calculated these pretax earnings to
be $26 million. We cannot predict whether the MoPSC will
approve this recommendation. If Ameren Missouri were to
determine that these sales were probable of refund to
Ameren Missouri’s electric customers, a charge to earnings
would be recorded for the refund in the period in which that
determination was made. Because of pending court appeals
and regulatory review, Ameren Missouri does not currently
believe these amounts are probable of refund to customers.
Renewable Energy Portfolio Requirement
A ballot initiative passed by Missouri voters in
November 2008 created a renewable energy portfolio
requirement. Beginning in 2011, Ameren Missouri and
other Missouri investor-owned utilities are required to
106
revenue reconciliation, along with the collar adjustment, if
necessary, will be collected from or refunded to customers
in a subsequent year.
Ameren Illinois will also be subject to five performance
standards. Failure to achieve the standards will result in a
reduction in the company’s allowed return on equity
calculated under the formula. The performance standards
include improvements in service reliability to reduce both
the frequency and duration of outages, improvements in
customer satisfaction scores, reduction in the number of
estimated bills, and a reduction in uncollectible accounts
expense. The IEIMA provides for return on equity penalties
totaling up to 30 basis points in 2013 through 2015, 34
basis points in 2016 through 2018, and 38 basis points in
2019 through 2022 if the performance standards are not
met. The formula ratemaking process is effective until the
end of 2017, but could be extended by the Illinois General
Assembly for an additional five years. The formula
ratemaking process would also terminate if the average
residential rate increases by more than 2.5% annually from
June 2011 through May 2014.
Between 2012 and 2021, Ameren Illinois will be
required to invest $625 million in capital expenditures
incremental to Ameren Illinois’ average electric delivery
capital expenditures for calendar years 2008 through 2010
to modernize its distribution system. Such investments are
expected to encourage economic development and to create
an estimated 450 additional jobs within Illinois. Ameren
Illinois is subject to monetary penalties if 450 additional
jobs are not created during the peak program years. Also,
Ameren Illinois will be required to contribute $1 million
annually for certain nonrecoverable customer assistance
programs for as long as Ameren Illinois participates in the
formula ratemaking process. Ameren Illinois will also be
required to make a one-time $7.5 million nonrecoverable
donation to the Illinois Science and Energy Innovation Trust
in 2012, as well as an approximate $1 million annual
donation to the same trust for as long as it participates in
the formula ratemaking process.
The IEIMA does not apply to natural gas utilities.
2012 Natural Gas Delivery Service Rate Order
In January 2012, the ICC issued a rate order that
approved an increase in annual Ameren Illinois’ revenues
for natural gas delivery service of $32 million. The revenue
increase was based on a 9.06% return on equity, a capital
structure composed of 53.3% common equity, and a rate
base of $1 billion. The rate order was based on a 2012
future test year. The rate changes became effective on
January 20, 2012. In February 2012, the ICC denied
rehearing requests by Ameren Illinois and an intervenor
related to the granted return on equity.
purchase or generate from renewable energy sources
electricity equaling at least 2% of native load sales, with that
percentage increasing in subsequent years to at least 15%
by 2021, subject to a 1% limit on customer rate impacts. At
least 2% of each portfolio requirement must be derived
from solar energy. Compliance with the renewable energy
portfolio requirement can be achieved through generation
or the procurement of renewable energy credits. Ameren
Missouri expects that any related costs or investments will
ultimately be recovered in rates.
In July 2010, the MoPSC issued final rules
implementing the state’s renewable energy portfolio
requirement. Ameren Missouri objected to the MoPSC rules
calculating the 1% limit on customer rates. In August 2010,
Ameren Missouri and other groups filed an appeal with the
Cole County Circuit Court of multiple aspects of the
MoPSC’s rules. In December 2011, the Cole County Circuit
Court issued a ruling clarifying that the 1% customer rate
increase limit is an annual restriction, not a multiyear limit.
Illinois
IEIMA
In October 2011, the IEIMA was enacted into law and
became effective immediately. Certain amendments to the
IEIMA became effective on December 30, 2011. On
January 3, 2012, Ameren Illinois elected to participate in the
performance-based formula ratemaking process established
pursuant to the IEIMA by filing initial performance-based
formula rates with the ICC. With this filing, as required by
law, Ameren Illinois’ previously pending electric delivery
service rate case was withdrawn. The initial filing, based on
2010 recoverable costs and expected net plant additions for
2011 and 2012, will result in new electric delivery service
rates in October 2012. Pending ICC approval, the initial
filing will result in a decrease of $19 million in Ameren
Illinois revenues for electric delivery service, on an
annualized basis. Ameren Illinois anticipates making an
update filing by May 1, 2012, based on 2011 costs and
expected net plant additions for 2012, that would result in
new electric delivery service rates on January 1, 2013.
Ameren Illinois will participate in a performance-based
formula process for determining rates. The formula will
provide for the recovery of actual costs of electric delivery
service that are prudently incurred, reflect the utility’s actual
regulated capital structure, and include a formula for
calculating the return on equity component of the cost of
capital. The return on equity component of the formula rate
will be equal to the average for the applicable calendar year
of the monthly average yields of 30-year United States
treasury bonds plus 590 basis points for 2012 and 580
basis points thereafter. Ameren Illinois’ actual return on
equity relating to electric delivery service will be subject to a
collar adjustment on earnings in excess of 50 basis points
above or below its allowed return. Beginning in 2012, the
law provides for an annual reconciliation of revenues to
costs prudently and reasonably incurred. This annual
107
2010 Electric and Natural Gas Delivery Service Rate Orders
During 2010, the ICC issued orders that authorized an
aggregate $40 million increase in Ameren Illinois’ annual
electric and natural gas delivery service revenues.
In December 2010, Ameren Illinois and an intervenor
appealed portions of the ICC’s orders to the Appellate Court
of the Fourth District of Illinois. In January 2012, the
Appellate Court issued a decision that upheld the ICC’s
2010 electric and natural gas delivery service rate order.
Federal
Electric Transmission Investment
FERC, in its order issued in May 2011, approved
transmission rate incentives for the Illinois Rivers project
and the Big Muddy project, which will be developed by ATXI
or ATX. The FERC May 2011 order approved the following
rate mechanisms with respect to Ameren’s Illinois Rivers
and Big Muddy projects:
‰
‰
‰
Full recovery of financing costs, including debt and
equity, associated with construction work in progress
before the asset is placed in service;
Recovery of costs prudently incurred in developing
project facilities that might later be abandoned due to
issues outside the company’s control; and
Use of a hypothetical capital structure during
construction that reflects a capital structure of 56%
common equity.
In December 2011, MISO approved the Illinois Rivers
project as well as the Spoon River and Mark Twain projects.
The total investment in these three MISO-approved projects
is expected to be more than $1.2 billion through 2019, with
potential investment of $750 million from 2012 to 2016. All
four projects are in Missouri and Illinois. Construction will
begin first on the Illinois Rivers project. The Big Muddy
project is currently being evaluated for inclusion in MISO’s
2012 expansion plan.
On December 30, 2011, ATXI made a filing with FERC
seeking a forward-looking rate calculation with an annual
revenue reconciliation adjustment as well as requesting the
implementation of the incentives FERC approved in its May
2011 order described above for the Illinois Rivers project
and the Big Muddy project. FERC is expected to issue a
decision on the ATXI filing during the first quarter of 2012.
2011 Wholesale Distribution Rate Case
In January 2011, Ameren Illinois filed a request with
FERC to increase its annual revenues for electric delivery
service for its wholesale customers by $11 million. These
wholesale distribution revenues are treated as a deduction
from Ameren Illinois’ revenue requirement in retail rate
filings with the ICC. In March 2011, FERC issued an order
authorizing the proposed rates to take effect, subject to
refund when the final rates are determined. Ameren Illinois
reached an agreement with two of its nine wholesale
customers in 2011. The impasse with the remaining seven
wholesale customers has resulted in FERC litigation. An
initial decision by the FERC administrative law judge is
expected in 2012 and a final FERC decision may be received
after 2012. We cannot predict the ultimate outcome of this
proceeding or its impact on Ameren’s or Ameren Illinois’
results of operations, financial position, or liquidity.
Regional Transmission Organization
Ameren Missouri is a transmission owning member of
MISO. Ameren Missouri received authorization from the
MoPSC to participate in MISO, subject to certain conditions.
Ameren Missouri’s continued conditional MISO
participation is authorized by the MoPSC through April 30,
2012.
As required by the MoPSC, Ameren Missouri filed in
November 2010 and again in August 2011 updated cost
benefit studies with the MoPSC that evaluated the costs and
benefits of Ameren Missouri’s continued participation in
MISO. Ameren Missouri’s updated studies continue to
show substantial benefits to Ameren Missouri customers
associated with its participation in MISO.
In November 2011, Ameren Missouri, together with
the MoPSC staff, the MIEC, and MISO, filed a
Non-Unanimous Stipulation and Agreement (Stipulation)
with the MoPSC that reflected their agreement that
continued Ameren Missouri participation in MISO through
May 31, 2016, was prudent and reasonable, subject to
certain conditions. The MoOPC opposes the Stipulation, in
part because of its desire that the MoPSC impose
conditions relating to ATX’s involvement in transmission
projects located within Ameren Missouri’s service territory.
These conditions, which are not included in the Stipulation
are, in Ameren Missouri’s view, inappropriate and unlawful.
Ameren Missouri expects an order from the MoPSC before
April 30, 2012.
FERC Order – MISO Charges
Ameren Missouri and Ameren Illinois, as well as other
MISO participants, have filed complaints with FERC with
respect to the FERC’s March 2007 order involving the
reallocation of certain MISO operational costs among MISO
participants retroactive to 2005. Subsequently, FERC has
issued a series of orders related to the applicability and the
implementation of the order, which in some cases have
conflicted with previous orders.
In May 2009, FERC changed the effective date for
refunds such that certain operational costs would be
allocated among MISO market participants beginning
November 2008, instead of August 2007. In June 2009,
Ameren Missouri and Ameren Illinois filed a request for
rehearing. The rehearing request is pending.
In June 2009, FERC issued an order dismissing
rehearing requests of a November 2008 order and waiving
refunds of amounts billed that were included in the MISO
charge, under the assumption that there was a rate
mismatch for the period April 2006 through November
108
2007. Ameren Missouri and Ameren Illinois filed a request
for rehearing in July 2009. This rehearing request is
pending.
Ameren Missouri and Ameren Illinois do not believe
that the ultimate resolution of these proceedings will have a
material effect on their results of operations, financial
position, or liquidity.
Ameren Missouri Power Purchase Agreement with Entergy
Arkansas, Inc.
Beginning in 2005, FERC issued a series of orders
addressing a complaint filed in 2001 by the Louisiana Public
Service Commission (LPSC) against Entergy Arkansas, Inc.
(Entergy) and certain of its affiliates. The complaint alleged
unjust and unreasonable cost allocations. As a result of the
FERC orders, Entergy began billing Ameren Missouri in
2007 for additional charges under a 165-megawatt power
purchase agreement, and Ameren Missouri paid those
charges. Additional charges continued during the remainder
of the term of the power purchase agreement, which
expired August 31, 2009. Although Ameren Missouri was
not a party to the FERC proceedings that gave rise to these
additional charges, Ameren Missouri intervened in related
FERC proceedings. Ameren Missouri also filed a complaint
with FERC against Entergy and Entergy Services, Inc. in
April 2008 to challenge the additional charges. In January
2010, FERC issued a ruling that Entergy may not pass the
additional charges on to Ameren Missouri. In February
2010, Entergy filed a request for rehearing of the January
2010 ruling. Ameren Missouri has not recorded any
prospective refund for additional charges paid to Entergy as
a result of the FERC orders.
The LPSC appealed FERC’s orders regarding LPSC’s
complaint against Entergy Services, Inc. to the United
States Court of Appeals for the District of Columbia. In April
2008, that court ordered further FERC proceedings
regarding LPSC’s complaint. The court ordered FERC to
explain its previous denial of retroactive refunds and the
implementation of prospective charges. FERC’s decision on
remand of the retroactive impact of these issues could have
a financial impact on Ameren Missouri. Ameren Missouri is
unable to predict how FERC will respond to the court’s
decisions. Ameren Missouri estimates that it could incur an
additional expense of up to $25 million if FERC orders
retroactive application for the years 2001 to 2005. Ameren
Missouri believes that the likelihood of incurring any
expense is not probable, and therefore no liability has been
recorded as of December 31, 2011. Ameren Missouri plans
to participate in any proceeding that FERC initiates to
address the court’s decisions.
COLA and Early Site Permit
In 2008, Ameren Missouri filed an application with the
NRC for a COLA for a new 1,600-megawatt nuclear unit at
Ameren Missouri’s existing Callaway County, Missouri,
nuclear energy center site. In 2009, Ameren Missouri
suspended its efforts to build a new nuclear unit at its
existing Missouri nuclear energy center site, and the NRC
suspended review of the COLA.
Ameren Missouri is considering filing an application to
obtain an early site permit from the NRC for the Callaway
energy center site. An early site permit approves a specific
location for a nuclear facility; however, additional licenses
would be required for the specific type and design of
nuclear facility to be built at that site. An early site permit
does not authorize construction of a plant. An early site
permit is valid for 20 years and could be renewed for up to
an additional 20 years. Attempts to pass legislation to
maintain an option for nuclear power in the state of
Missouri by recovering the costs of the early site permit,
subject to appropriate consumer protections, were not
successful during 2011. However, support for nuclear
power exists in the state of Missouri, which could lead to
the passage of an early site permit recovery mechanism in
future legislative sessions. Ameren Missouri’s pursuit of an
early site permit is dependent upon enactment of a
legislative framework ensuring cost recovery.
As of December 31, 2011, Ameren Missouri had
capitalized $69 million relating to its efforts to construct a
new nuclear unit. All of these incurred costs will remain
capitalized while management assesses options to
maximize the value of its investment in this project. If
efforts are permanently abandoned or management
concludes it is probable the costs incurred will be
disallowed in rates, a charge to earnings would be
recognized in the period in which that determination was
made.
Pumped-storage Hydroelectric Energy Center Relicensing
In June 2008, Ameren Missouri filed a relicensing
application with FERC to operate its Taum Sauk pumped-
storage hydroelectric energy center for another 40 years.
The existing FERC license expired on June 30, 2010. On
July 2, 2010, Ameren Missouri received a license extension
that allows Taum Sauk to continue operations until FERC
issues a new license. FERC is reviewing the relicensing
application. A FERC order is expected in 2012 or 2013.
Ameren Missouri cannot predict the ultimate outcome of
the application.
109
Regulatory Assets and Liabilities
In accordance with authoritative accounting guidance regarding accounting for the effects of certain types of regulation,
Ameren Missouri and Ameren Illinois defer certain costs pursuant to actions of regulators or based on the expected ability to
recover such costs in rates charged to customers. Ameren Missouri and Ameren Illinois also defer certain amounts because of
actions of regulators or because of the expectation that such amounts will be returned to customers in future rates. The
following table presents Ameren’s, Ameren Missouri’s and Ameren Illinois’ regulatory assets and regulatory liabilities at
December 31, 2011, and 2010:
2011
Ameren
Missouri
Ameren(a)
Ameren
Illinois
Ameren(a)
2010
Ameren
Missouri
Ameren
Illinois
Current regulatory assets:
Under-recovered FAC(b)(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Under-recovered Illinois electric power costs(b)(d)
. . . . . . . . . . . .
Under-recovered PGA(b)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
MTM derivative losses(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current regulatory assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent regulatory assets:
Pension and postretirement benefit costs(f)
. . . . . . . . . . . . . . . . .
Income taxes(g) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asset retirement obligation(h)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Callaway costs(b)(i)
. . . . . . . . . . . . . . . . . . .
Unamortized loss on reacquired debt(b)(j)
Recoverable costs – contaminated facilities(k)
. . . . . . . . . . . . . . .
MTM derivative losses(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . .
SO2 emission allowances sale tracker(l)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Storm costs(m)
Demand-side costs(n)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reserve for workers’ compensation liabilities(o) . . . . . . . . . . . . . .
Credit facilities fees(p) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employee separation costs(q)
Common stock issuance costs(r)
. . . . . . . . . . . . . . . . . . . . . . . . .
Construction accounting for pollution control equipment(b)(s) . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(t)
Total noncurrent regulatory assets . . . . . . . . . . . . . . . . . . . . . . . . . .
Current regulatory liabilities:
Over-recovered FAC(u) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Over-recovered Illinois electric power costs(d)
. . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Over-recovered PGA(d)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
MTM derivative gains(v)
Total current regulatory liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent regulatory liabilities:
Income taxes(w) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Removal costs(x) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asset retirement obligation(h)
MTM derivative gains(v)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Bad debt rider(y)
Pension and postretirement benefit costs tracker(z)
. . . . . . . . . . .
Energy efficiency rider(aa)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(bb)
$
$
$
$
$
$
$
83
4
8
120
215
878
239
6
48
47
102
100
6
16
70
13
10
6
10
25
27
1,603
12
66
9
46
133
48
1,269
29
82
10
38
24
2
$
$
$
$
$
$
$
Total noncurrent regulatory liabilities . . . . . . . . . . . . . . . . . . . . . . . .
$
1,502
$
83
-
5
21
109
382
234
-
48
21
-
13
6
16
70
7
10
3
10
25
10
855
12
-
-
45
57
44
719
29
4
-
38
-
2
836
$
$
$
$
$
$
$
$
-
4
3
299
306
496
5
6
-
26
102
87
-
-
-
6
-
3
-
-
17
748
-
66
9
1
76
4
550
-
78
10
-
24
-
666
$
$
$
$
$
$
$
$
$
$
$
$
$
$
158
4
2
103
267
555
230
9
51
53
127
85
12
23
39
14
12
8
12
4
29
1,263
-
62
12
25
99
54
1,177
-
20
5
45
13
5
$
1,319
$
158
-
-
21
179
251
225
3
51
25
-
14
12
23
39
8
12
6
12
4
9
694
-
-
1
22
23
48
655
-
13
-
45
-
5
766
$
$
$
$
$
$
$
$
-
4
2
254
260
304
5
6
-
28
127
249
-
-
-
6
-
2
-
-
20
747
-
62
11
3
76
6
522
-
7
5
-
13
-
553
Includes intercompany eliminations.
(a)
(b) These assets earn a return.
(c) Under-recovered fuel costs for periods from July 2009 through December 2011. Specific accumulation periods aggregate the under-recovered
costs over four months, any related adjustments occur over the following four months, and then recovery from customers occurs over the next
eight months.
(d) Costs under- or over-recovered from utility customers. Amounts will be recovered from, or refunded to, customers within one year of the
deferral.
(e) Deferral of commodity-related derivative MTM losses, as well as the MTM losses on financial contracts entered into by Ameren Illinois with
Marketing Company.
110
(f)
These costs are being amortized in proportion to the recognition of prior service costs (credits), transition obligations (assets), and actuarial
losses (gains) attributable to Ameren’s pension plan and postretirement benefit plans. See Note 11 – Retirement Benefits for additional
information.
(g) Offset to certain deferred tax liabilities for expected recovery of future income taxes when paid. See Note 13 – Income Taxes for amortization
period.
(h) Recoverable or refundable removal costs for AROs at our rate-regulated operations, including net realized and unrealized gains and losses
related to the nuclear decommissioning trust fund investments. See Note 1 – Summary of Significant Accounting Policies – Asset Retirement
Obligations.
(i) Ameren Missouri’s Callaway energy center operations and maintenance expenses, property taxes, and carrying costs incurred between the
plant in-service date and the date the plant was reflected in rates. These costs are being amortized over the remaining life of the plant’s current
operating license (through 2024).
Losses related to reacquired debt. These amounts are being amortized over the lives of the related new debt issuances or the remaining lives of
the old debt issuances if no new debt was issued.
(j)
(k) The recoverable portion of accrued environmental site liabilities, primarily collected from electric and natural gas customers through
ICC-approved cost recovery riders. The period of recovery will depend on the timing of actual expenditures. See Note 15 – Commitments and
Contingencies for additional information.
(l) A regulatory tracking mechanism for gains on sales of SO2 emission allowances, net of SO2 premiums incurred under the terms of coal
procurement contracts, plus any SO2 discounts received under such contracts, as approved in a MoPSC order. The MoPSC’s May 2010 electric
rate order discontinued any future deferrals under this tracking mechanism. The MoPSC’s July 2011 rate order approved the amortization of
these costs through July 2013.
(m) Actual storm costs in a test year that exceed the MoPSC staff’s normalized storm costs for rate purposes. The 2006 storm costs are being
amortized until July 2013. The 2008 storm costs are being amortized over five years, beginning on March 1, 2009. In addition, the balance
includes January 2007 ice storm costs that Ameren Missouri will recover over five years, beginning in March 2009, as approved by the January
2009 MoPSC electric rate order. The 2009 storm costs are being amortized over five years, beginning in July 2010, as approved by the May
2010 MoPSC electric rate order.
(n) Demand-side costs, including the costs of developing, implementing and evaluating customer energy efficiency and demand response
programs. Costs incurred from May 2008 through September 2008 are being amortized over 10 years, beginning in March 2009. Costs
incurred from October 2008 through December 2009 are being amortized over six years, beginning in July 2010. Costs incurred from January
2010 through February 2011 are being amortized over six years, beginning in August 2011. The amortization period for the costs incurred after
February 2011 will be determined in Ameren Missouri’s pending electric rate case.
(o) Reserve for workers’ compensation claims.
(p) Ameren Missouri’s costs incurred to enter into and maintain the 2009 multiyear and supplemental credit agreements, prior to their termination
in 2010. These costs are being amortized over two years, beginning in July 2010, as approved by the May 2010 MoPSC electric rate order.
These costs are being amortized to construction work in progress, which will be subsequently depreciated when assets are placed into service.
(q) Cost incurred for the voluntary and involuntary separation programs. The 2009 Ameren Missouri-related costs are being amortized over three
years, beginning in July 2010, as approved by the May 2010 MoPSC electric rate order. The 2009 Ameren Illinois-related costs are being
amortized over three years, beginning in May 2010, as approved by the April 2010 ICC electric and natural gas rate order.
The MoPSC’s May 2010 electric rate order allowed Ameren Missouri to recover its portion of Ameren’s September 2009 common stock
issuance costs. These costs are being amortized over five years, beginning in July 2010.
(r)
(t)
(s) The MoPSC’s May 2010 electric rate order allowed Ameren Missouri to continue recording an allowance for funds used during construction for
pollution control equipment at its Sioux energy center until the cost of that equipment is placed in customer rates. The amortization of these
costs will be over the expected life of the Sioux energy center.
Includes costs related to Ameren Illinois’ delivery service rate cases that resulted in orders in 2008 and 2010 as well as the natural gas delivery
service rate case that resulted in an order in January 2012. The natural gas costs associated with the 2008 rate case will be amortized until
September 2013. The 2010 rate case costs are being amortized over a two-year period, beginning in May 2010. The 2012 natural gas rate case
costs will be amortized over a two year period, beginning in January 2012. The Ameren Illinois total also includes a portion of the unamortized
debt fair value adjustment recorded upon Ameren’s acquisition of IP. This portion is being amortized over the remaining life of the related debt,
beginning with the expiration of the electric rate freeze in Illinois on January 1, 2007. The Ameren Illinois total also includes Ameren Illinois
Merger integration and optimization costs. These costs will be amortized over four years, beginning in January 2012. At Ameren Missouri, the
balance includes cost associated with the retirement of renewable energy credits and solar rebates to fulfill Ameren Missouri’s renewable
energy portfolio requirement. The amortization period for these costs will be determined in Ameren Missouri’s pending electric rate case. The
Ameren Missouri balance also includes a regulatory tracking mechanism for the difference between the level of vegetation management and
infrastructure inspection costs incurred by Ameren Missouri under GAAP and the level of such costs included in electric rates. Ameren
Missouri’s vegetation management and infrastructure inspection costs from July 2011 through December 2011 were more than the amount
allowed in base rates. The amortization period for these costs will be determined in Ameren Missouri’s pending electric rate case.
(u) Over-recovered fuel costs from March 2009 through September 2009 as ordered by the MoPSC in April 2011. Customer refunds will conclude
in May 2012.
(v) Deferral of commodity-related derivative MTM gains.
(w) Unamortized portion of investment tax credit and federal excess deferred taxes. See Note 13 – Income Taxes for amortization period.
(x) Estimated funds collected for the eventual dismantling and removal of plant from service, net of salvage value, upon retirement related to our
rate-regulated operations. See discussion in Note 1 – Summary of Significant Accounting Policies – Asset Retirement Obligations.
(y) A regulatory tracking mechanism for the difference between the level of bad debt expense incurred by Ameren Illinois under GAAP and the level
of such costs included in electric and natural gas rates. The over-recovery relating to 2010 is being refunded to customers from June 2011
through May 2012. The over-recovery relating to 2011 will be refunded to customers from June 2012 through May 2013.
(z) A regulatory tracking mechanism for the difference between the level of pension and postretirement benefit costs incurred by Ameren Missouri
under GAAP and the level of such costs built into electric rates. The 2008 costs are being amortized through February 2014. The 2009 costs are
111
being amortized through June 2015. The 2010 costs assigned to the natural gas and electric businesses are being amortized through February
2016 and July 2016, respectively. The 2011 costs will be determined in Ameren Missouri’s pending electric rate case.
(aa) A regulatory tracking mechanism that allows Ameren Illinois to recover its electric and natural gas costs associated with developing,
implementing and evaluating customer energy efficiency and demand response programs. This over-recovery will be refunded to customers
over the following 12 months after the plan year.
(bb) Balance includes a regulatory tracking mechanism for the difference between the level of vegetation management and infrastructure inspection
costs incurred by Ameren Missouri under GAAP and the level of such costs included in electric rates. Ameren Missouri’s vegetation
management and infrastructure inspection costs from July 2010 through February 2011 were less than the amount allowed in base rates. The
over-recovery incurred during that time period is being amortized over three years beginning in August 2011. The balance also includes the
deferral of gains on emission allowance vintage swaps Ameren Missouri entered into during 2005. The balance of this gain was immaterial at
the end of 2011.
Ameren Missouri and Ameren Illinois continually assess the recoverability of their regulatory assets. Under current
accounting standards, regulatory assets are charged to earnings when it is no longer probable that such amounts will be
recovered through future revenues. To the extent that payments of regulatory liabilities are no longer probable, the amounts
are credited to earnings.
NOTE 3 – PROPERTY AND PLANT, NET
The following table presents property and plant, net, for each of the Ameren Companies at December 31, 2011 and 2010:
Ameren(a)(b)
Ameren
Missouri(b)
Ameren
Illinois
Genco
2011:
Property and plant, at original cost:
Electric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Less: Accumulated depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Construction work in progress:
Nuclear fuel in process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
24,256
1,746
466
26,468
9,429
17,039
255
833
$
14,986
385
113
15,484
6,276
9,208
255
495
$
4,600
1,361
91
6,052
1,364
4,688
-
82
$ 3,370
-
39
3,409
1,377
2,032
-
199
Property and plant, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
18,127
$
9,958
$
4,770
$ 2,231
2010:
Property and plant, at original cost:
Electric . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Less: Accumulated depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Construction work in progress:
Nuclear fuel in process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
24,069
1,661
424
26,154
9,194
16,960
259
634
$
14,745
374
91
15,210
6,052
9,158
259
358
$
4,436
1,286
61
5,783
1,250
4,533
-
43
$
3,572
-
48
3,620
1,518
2,102
-
146
Property and plant, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
17,853
$
9,775
$
4,576
$
2,248
Includes amounts for Ameren registrant and nonregistrant subsidiaries as well as intercompany eliminations.
(a)
(b) Amounts in Ameren and Ameren Missouri include two electric generation CTs under two separate capital lease agreements. The gross asset
value of those agreements was $229 million and $228 million at December 31, 2011 and 2010, respectively. The total accumulated depreciation
associated with the two CTs was $52 million and $46 million at December 31, 2011 and 2010, respectively.
The following table provides accrued capital expenditures at December 31, 2011, 2010, and 2009, which represent
noncash investing activity excluded from the statements of cash flows:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
112
Ameren(a)
$
107
79
143
Ameren
Missouri
$
73
53
86
Ameren
Illinois
$
18
15
29
Genco
$
13
8
23
NOTE 4 – SHORT-TERM DEBT AND LIQUIDITY
The liquidity needs of the Ameren Companies are typically supported through the use of available cash, short-term
intercompany borrowings, drawings under committed bank credit facilities, or commercial paper issuances.
The following table summarizes the borrowing activity and relevant interest rates under the 2010 Missouri Credit
Agreement described below for the year ended December 31, 2011, and excludes letters of credit issued under the credit
agreement:
2010 Missouri Credit Agreement ($800 million)
Ameren
(Parent)
Ameren
Missouri
Total
2011:
Average daily borrowings outstanding during 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Outstanding credit facility borrowings at period end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average interest rate during 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak credit facility borrowings during 2011(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak interest rate during 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
Average daily borrowings outstanding during 2010(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Outstanding credit facility borrowings at period end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average interest rate during 2010(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak credit facility borrowings during 2010(a)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak interest rate during 2010(b)
$
$
$
$
105
-
2.30%
340
4.30%
195
340
2.31%
380
2.31%
$
$
$
$
-
-
-
-
-
-
-
-
-
-
$
$
$
$
105
-
2.30%
340
4.30%
195
340
2.31%
380
2.31%
(a) The timing of peak credit facility borrowings varies by company and therefore the amounts presented by company might not equal the total
peak credit facility borrowings for the period. The simultaneous peak credit facility borrowings by the Ameren Companies under all credit
facilities during 2011 and 2010 were $460 million and $925 million, respectively.
(b) Calculated from the September 10, 2010, inception date through December 31, 2010.
The following table summarizes the borrowing activity and relevant interest rates under the 2010 Genco Credit Agreement
described below for the year ended December 31, 2011:
2010 Genco Credit Agreement ($500 million)
2011:
Average daily borrowings outstanding during 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Outstanding credit facility borrowings at period end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average interest rate during 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak credit facility borrowings during 2011(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak interest rate during 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Average daily borrowings outstanding during 2010(b)
Outstanding credit facility borrowings at period end . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Weighted-average interest rate during 2010(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak credit facility borrowings during 2010(a)(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Peak interest rate during 2010(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
(Parent)
Genco
Total
$
$
$
$
-
-
-
-
-
36
-
2.30%
385
2.31%
$
$
$
$
41
-
2.30%
100
2.31%
54
100
2.31%
100
2.31%
$
$
$
$
41
-
2.30%
100
2.31%
90
100
2.31%
385
2.31%
(a) The timing of peak credit facility borrowings varies by company, and therefore the amounts presented by company might not equal the total
peak credit facility borrowings for the period. The simultaneous peak credit facility borrowings by the Ameren Companies under all credit
facilities during 2011 and 2010 were $460 million and $925 million, respectively.
(b) Calculated from the September 10, 2010, inception date through December 31, 2010.
Neither Ameren nor Ameren Illinois borrowed under the 2010 Illinois Credit Agreement during the years ended
December 31, 2011, and 2010, respectively.
2010 Credit Agreements
Ameren and certain of its subsidiaries entered into multiyear credit facility agreements with a large and diverse group of
lenders in 2010. These facilities cumulatively provide $2.1 billion of credit through September 10, 2013. The facilities currently
include 25 international, national, and regional lenders, with no lender providing more than $125 million of credit in aggregate.
On September 10, 2010, Ameren and Ameren Missouri entered into the $800 million 2010 Missouri Credit Agreement. On
September 10, 2010, Ameren and Genco entered into the $500 million 2010 Genco Credit Agreement. Also on September 10,
2010, Ameren and Ameren Illinois, as successor company to CIPS, CILCO and IP, entered into the $800 million 2010 Illinois
Credit Agreement.
113
The obligations of each borrower under the respective 2010 Credit Agreements to which it is a party are several and not
joint, and, except under limited circumstances relating to expenses and indemnities, the obligations of Ameren Missouri,
Ameren Illinois and Genco under the respective 2010 Credit Agreements are not guaranteed by Ameren or any other subsidiary
of Ameren. The maximum aggregate amount available to each borrower under each facility is shown in the following table
(such amount being such borrower’s “Borrowing Sublimit”):
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
500
500
(a)
(a)
$
500
(a)
(a)
500
$
300
(a)
800
(a)
2010
Missouri
Credit
Agreement
2010
Genco
Credit
Agreement
2010
Illinois
Credit
Agreement
(a) Not applicable.
Ameren has the option to seek additional commitments
from existing or new lenders to increase the total facility
size of the 2010 Credit Agreements to the following
maximum amounts: 2010 Missouri Credit Agreement –
$1.0 billion; 2010 Genco Credit Agreement – $625 million;
and 2010 Illinois Credit Agreement – $1.0 billion. Each of
the 2010 Credit Agreements will mature and expire on
September 10, 2013. In February 2011, Ameren Illinois
received approval from the ICC to extend the expiration of
its Borrowing Sublimit under the 2010 Illinois Credit
Agreement to September 10, 2013. In June 2011, Ameren
Missouri received approval from the MoPSC to extend the
expiration of its borrowing sublimit under the 2010
Missouri Credit Agreement to September 10, 2013. The
principal amount of each revolving loan owed by a borrower
under any of the 2010 Credit Agreements to which it is a
party will be due and payable no later than September 10,
2013.
The obligations of all borrowers under the 2010 Credit
Agreements are unsecured. Loans are available on a
revolving basis under each of the 2010 Credit Agreements
and may be repaid and, subject to satisfaction of the
conditions to borrowing, reborrowed from time to time. At
the election of each borrower, the interest rates on such
loans will be the alternate base rate (ABR) plus the margin
applicable to the particular borrower and/or the eurodollar
rate plus the margin applicable to the particular borrower.
The applicable margins will be determined by the
borrower’s long-term unsecured credit ratings or, if no such
ratings are then in effect, the borrower’s corporate/issuer
ratings then in effect. Letters of credit in an aggregate
undrawn face amount not to exceed 25% of the applicable
aggregate commitment under the respective 2010 Credit
Agreements are also available for issuance for the account
of the borrowers thereunder (but within the $2.1 billion
overall combined facility borrowing limitations of the 2010
Credit Agreements).
The 2010 Credit Agreements are used to borrow cash,
to issue letters of credit, and to support borrowings under
Ameren’s $500 million commercial paper program, Ameren
Missouri’s $500 million commercial paper program and
Ameren Illinois’ $500 million commercial paper program.
Any of the 2010 Credit Agreements are available to Ameren
to support borrowings under Ameren’s commercial paper
program, subject to borrowing sublimits. The 2010
Missouri Credit Agreement is available to support
borrowings under Ameren Missouri’s commercial paper
program, and the 2010 Illinois Credit Agreement is available
to support borrowings under Ameren Illinois’ commercial
paper program. At December 31, 2011, Ameren had
$148 million of commercial paper outstanding and
$15 million of letters of credit outstanding, and Ameren
Missouri and Ameren Illinois had no commercial paper or
letters of credit outstanding. Based on outstanding
borrowings and letters of credit issued under the 2010
Credit Agreements as of December 31, 2011, as well as
commercial paper outstanding as of such date, the
aggregate amount of credit capacity available under the
2010 Credit Agreements at December 31, 2011, was
$1.9 billion.
$20 Million Credit Facility (Terminated)
On June 2, 2010, Ameren entered into a $20 million
revolving credit facility ($20 Million Facility). Borrowings
under the $20 Million Facility incurred interest at a rate
equal to the applicable LIBOR plus 2.25% per annum. The
obligations of Ameren under the $20 Million Facility were
unsecured. No subsidiary of Ameren was a party to,
guarantor of, or borrower under the facility. Ameren had no
outstanding borrowings under the facility as of
December 31, 2011. Ameren terminated the $20 Million
Facility in January 2012. During the years ended
December 31, 2011 and 2010, Ameren had average daily
balances outstanding of $20 million, with a weighted-
average interest rate of 2.48% and 2.54%, respectively.
Commercial Paper
At December 31, 2011, and 2010, Ameren had
$148 million and $269 million of commercial paper
outstanding, respectively. During the years ended
December 31, 2011 and 2010, Ameren had average daily
commercial paper balances outstanding of $311 million and
$185 million with a weighted-average interest rate of 0.87%
and 0.94%, respectively. The peak short-term commercial
paper outstanding during the years ended December 31,
2011, and 2010 were $435 million and $366 million,
114
respectively. The peak interest rate for both years was
1.46%. During 2010, the commercial paper was issued only
from July through December.
Indebtedness Provisions and Other Covenants
The information below presents a summary of the
Ameren Companies’ compliance with indebtedness
provisions and other covenants.
The 2010 Credit Agreements contain conditions about
borrowings and issuances of letters of credit, including the
absence of default or unmatured default, material accuracy
of representations and warranties (excluding any
representation after the closing date as to the absence of
material adverse change and material litigation), and
obtaining required regulatory authorizations. In addition,
solely as it relates to borrowings under the 2010 Illinois
Credit Agreement, it is a condition for any such borrowing
that, at the time of and after giving effect to such
borrowing, the borrower not be in violation of any limitation
on its ability to incur unsecured indebtedness contained in
its articles of incorporation. The 2010 Credit Agreements
also contain nonfinancial covenants, including restrictions
on the ability to incur liens, to transact with affiliates, to
dispose of assets, to make investments in or transfer assets
to its affiliates, and to merge with other entities.
The 2010 Credit Agreements require each of Ameren,
Ameren Missouri, Ameren Illinois and Genco to maintain
consolidated indebtedness of not more than 65% of its
consolidated total capitalization pursuant to a defined
calculation set forth in the agreements. As of December 31,
2011, the ratios of consolidated indebtedness to total
consolidated capitalization, calculated in accordance with
the provisions of the 2010 Credit Agreements, were 47%,
48%, 41% and 45%, for Ameren, Ameren Missouri,
Ameren Illinois and Genco, respectively. In addition, under
the 2010 Genco Credit Agreement and the 2010 Illinois
Credit Agreement, Ameren is required to maintain a ratio of
consolidated funds from operations plus interest expense to
consolidated interest expense of 2.0 to 1.0, to be calculated
quarterly, as of the end of the most recent four fiscal
quarters then ending, in accordance with the 2010 Genco
Credit Agreement and the 2010 Illinois Credit Agreement, as
applicable. Ameren’s ratio as of December 31, 2011 was 5.1
to 1.0. Failure of a borrower to satisfy a financial covenant
constitutes an immediate default under the applicable 2010
Credit Agreement.
The 2010 Credit Agreements contain default
provisions. Defaults under the 2010 Credit Agreements
apply separately to each borrower; except however, that a
default by Ameren Missouri, Ameren Illinois or Genco under
any of the 2010 Credit Agreements will also constitute a
default by Ameren under such agreement. Defaults include
a cross default with respect to a borrower under the
applicable 2010 Credit Agreements if that borrower defaults
under any other agreement covering outstanding
indebtedness of itself and certain subsidiaries (other than
project finance subsidiaries and nonmaterial subsidiaries) in
excess of $25 million in the aggregate. Any default of
Ameren under any 2010 Credit Agreement that exists solely
as a result of a default by Ameren Missouri, Ameren Illinois
or Genco thereunder will not constitute a default under any
other 2010 Credit Agreement while Ameren is otherwise in
compliance with all of its obligations under such other 2010
Credit Agreement. Further, a default at the Ameren level
under any 2010 Credit Agreement does not trigger a default
by Ameren Missouri, Ameren Illinois or Genco under such
agreement.
None of the Ameren Companies’ credit facilities or
other financing arrangements contains credit rating triggers
that would cause an event of default or acceleration of
repayment of outstanding balances. At December 31, 2011,
management believes that the Ameren Companies were in
compliance with the provisions and covenants of their
credit facilities.
Money Pools
Ameren has money pool agreements with and among
its subsidiaries to coordinate and provide for certain short-
term cash and working capital requirements. Separate
money pools are maintained for utility and non-state-
regulated entities. Ameren Services is responsible for the
operation and administration of the money pool
agreements.
Utility
Ameren Missouri, Ameren Illinois and Ameren Services
may participate in the utility money pool as both lenders
and borrowers. Ameren and AERG may participate in the
utility money pool only as lenders. Ameren Services
administers the utility money pool and tracks internal and
external funds separately. Internal funds are surplus funds
contributed to the utility money pool from participants. The
primary sources of external funds for the utility money pool
are the 2010 Credit Agreements and the commercial paper
programs. The total amount available to the pool
participants from the utility money pool at any given time is
reduced by the amount of borrowings by participants, but
increased to the extent that the pool participants advance
surplus funds to the utility money pool or remit funds from
other external sources. The availability of funds is also
determined by funding requirement limits established by
regulatory authorizations. The utility money pool was
established to coordinate and to provide short-term cash
and working capital for the participants. Participants
receiving a loan under the utility money pool agreement
must repay the principal amount of such loan, together with
accrued interest. The rate of interest depends on the
composition of internal and external funds in the utility
money pool. There were no utility money pool borrowings
during the years ended December 31, 2011 and 2010.
Non-state-regulated Subsidiaries
Ameren, Ameren Services, AER, Genco, AERG,
Marketing Company, and other non-state-regulated Ameren
subsidiaries have the ability, subject to Ameren parent
115
company authorization and applicable regulatory short-term
borrowing authorizations, to access funding from the 2010
Credit Agreements and the commercial paper programs
through a non-state-regulated subsidiary money pool
agreement. All participants may borrow from or lend to the
non-state-regulated money pool, except for Ameren
Services, which may participate only as a borrower. The
total amount available to the pool participants at any given
time is reduced by the amount of borrowings made by
participants, but is increased to the extent that the pool
participants advance surplus funds to the non-state-
regulated subsidiary money pool or remit funds from other
external sources. The non-state-regulated subsidiary money
pool was established to coordinate and to provide short-
term cash and working capital for the participants.
Participants receiving a loan under the non-state-regulated
subsidiary money pool agreement must repay the principal
amount of such loan, together with accrued interest. The
rate of interest depends on the composition of internal and
external funds in the non-state-regulated subsidiary money
pool. The average interest rate for borrowing under the
non-state-regulated subsidiary money pool for the year
ended December 31, 2011, was 0.77% (2010 – 0.77%).
NOTE 5 – LONG-TERM DEBT AND EQUITY FINANCINGS
See Note 14 – Related Party Transactions for the
amount of interest income and expense from the money
pool arrangements recorded by the Ameren Companies for
the years ended December 31, 2011, 2010, and 2009.
Unilateral Borrowing Agreement
In addition, a unilateral borrowing agreement exists
among Ameren, Ameren Illinois, and Ameren Services,
which enables Ameren Illinois to make short-term
borrowings directly from Ameren. The aggregate amount of
borrowings outstanding at any time by Ameren Illinois
under the unilateral borrowing agreement and the utility
money pool agreement, together with any outstanding
Ameren Illinois external credit facility borrowings or
commercial paper issuances, may not exceed $500 million,
pursuant to authorization from the ICC. Ameren Illinois is
not currently borrowing under the unilateral borrowing
agreement. Ameren Services is responsible for operation
and administration of the unilateral borrowing agreement.
The following table presents long-term debt outstanding for the Ameren Companies as of December 31, 2011, and 2010:
2011
2010
Ameren (Parent):
8.875% Senior unsecured notes due 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Unamortized discount and premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Senior secured notes:(a)
5.25% Senior secured notes due 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.65% Senior secured notes due 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.50% Senior secured notes due 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
4.75% Senior secured notes due 2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.40% Senior secured notes due 2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.40% Senior secured notes due 2017 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.00% Senior secured notes due 2018(b)
5.10% Senior secured notes due 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.70% Senior secured notes due 2019(b)
5.10% Senior secured notes due 2019 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.00% Senior secured notes due 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.50% Senior secured notes due 2034 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.30% Senior secured notes due 2037 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8.45% Senior secured notes due 2039(b)
Environmental improvement and pollution control revenue bonds:
1992 Series due 2022(c)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1993 5.45% Series due 2028(e)
1998 Series A due 2033(c)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1998 Series B due 2033(c)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1998 Series C due 2033(c)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Capital lease obligations:
City of Bowling Green capital lease (Peno Creek CT) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Audrain County capital lease (Audrain County CT) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
425
(1)
424
173
200
104
114
260
425
250
200
450
300
85
184
300
350
47
44
60
50
50
69
240
Total long-term debt, gross . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
3,955
Less: Unamortized discount and premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Maturities due within one year
(5)
(178)
$
$
$
425
(2)
423
173
200
104
114
260
425
250
200
450
300
85
184
300
350
47
44
60
50
50
74
240
3,960
(6)
(5)
Long-term debt, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
3,772
$
3,949
116
2011
2010
Ameren Illinois:
Senior secured notes:
6.625% Senior secured notes due 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
8.875% Senior secured notes due 2013(f)(h) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.20% Senior secured notes due 2016(f)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.25% Senior secured notes due 2016(g)
6.125% Senior secured notes due 2017(g)(i) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.25% Senior secured notes due 2018(g)(i) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9.75% Senior secured notes due 2018(g)(i) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.125% Senior secured notes due 2028(g)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.70% Senior secured notes due 2036(g)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
6.70% Senior secured notes due 2036(f)
$
Environmental improvement and pollution control revenue bonds:
6.20% Series 1992B due 2012(j) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2000 Series A 5.50% due 2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.90% Series 1993 due 2023(j) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.70% 1994A Series due 2024(k)
1993 Series C-1 5.95% due 2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1993 Series C-2 5.70% due 2026 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1993 Series B-1 due 2028(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.40% 1998A Series due 2028(k)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.40% 1998B Series due 2028(k)
Fair-market value adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
-
150
54
75
250
337
400
60
61
42
1
51
32
36
35
8
17
19
33
5
Total long-term debt, gross . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,666
Less: Unamortized discount and premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Maturities due within one year
(8)
(1)
$
150
150
54
75
250
337
400
60
61
42
1
51
32
36
35
8
17
19
33
5
1,816
(9)
(150)
Long-term debt, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
1,657
$
1,657
Genco:
Unsecured notes:
Senior notes Series F 7.95% due 2032 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Senior notes Series H 7.00% due 2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Senior notes Series I 6.30% due 2020 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Total long-term debt, gross . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Unamortized discount and premium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less: Maturities due within one year
Long-term debt, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren consolidated long-term debt, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
275
300
250
825
(1)
-
$
275
300
250
825
(1)
-
$
$
824
6,677
$
$
824
6,853
(a) These notes are collaterally secured by first mortgage bonds issued by Ameren Missouri under the Ameren Missouri mortgage indenture. The
notes have a fall-away lien provision and will remain secured only as long as any first mortgage bonds issued under the Ameren Missouri
mortgage indenture remain outstanding. Redemption, purchase, or maturity of all first mortgage bonds, including first mortgage bonds
currently outstanding and any that may be issued in the future, would result in a release of the first mortgage bonds currently securing these
notes, at which time these notes would become unsecured obligations. Based on the Ameren Missouri first mortgage bonds and senior
secured notes currently outstanding, and assuming no early retirement of any series of such securities in full, we do not expect the first
mortgage bond lien protection associated with these notes to fall away until 2039.
(b) Ameren Missouri has agreed, during the life of these notes, not to optionally redeem, purchase or otherwise retire in full its first mortgage
bonds. Ameren Missouri has also agreed to prevent a first mortgage bond release date from occurring as long as any of the 8.45% Senior
secured notes due 2039 remain outstanding.
(c) These bonds are secured by first mortgage bonds issued by Ameren Missouri under the Ameren Missouri mortgage indenture and have a fall-
away lien provision similar to that of the company’s senior secured notes. The bonds are also backed by an insurance guarantee policy.
Interest rates, and periods during which such rates apply, vary depending on our selection of defined rate modes. Maximum interest rates
could range up to 18% depending on the series of bonds. The average interest rates for 2011 and 2010 were as follows:
(d)
2011
2010
Ameren Missouri 1992 Series . . . . . . . . . . . . 0.34% 0.47%
Ameren Missouri 1998 Series A . . . . . . . . . . 0.69% 0.71%
Ameren Missouri 1998 Series B . . . . . . . . . . 0.68% 0.73%
Ameren Missouri 1998 Series C . . . . . . . . . . 0.69% 0.74%
Ameren Illinois 1993 Series B-1 . . . . . . . . . . 0.28% 0.59%
(e) These bonds are first mortgage bonds issued by Ameren Missouri under the UE mortgage bond indenture and are secured by substantially all
Ameren Missouri property and franchises. The bonds are callable at 100% of par value.
117
(f)
These notes are collaterally secured by first mortgage bonds issued by Ameren Illinois under the CILCO mortgage indenture. The notes have a
fall-away lien provision and will remain secured only as long as any series of first mortgage bonds issued under the CILCO mortgage indenture
remain outstanding. Redemption, purchase, or maturity of all first mortgage bonds, including first mortgage bonds currently outstanding and
any that may be issued in the future, would result in a release of the first mortgage bonds currently securing these notes, at which time these
notes would become unsecured obligations. Based on the CILCO first mortgage bonds and senior secured notes currently outstanding, and
assuming no early retirement of any series of such securities in full, we do not expect the first mortgage bond lien protection associated with
these notes to fall away until 2023.
(g) These notes are collaterally secured by mortgage bonds issued by Ameren Illinois under the Ameren Illinois mortgage indenture. The notes
have a fall-away lien provision and will remain secured only as long as any series of first mortgage bonds issued under the Ameren Illinois
mortgage indenture remain outstanding. Redemption, purchase, or maturity of all mortgage bonds, including first mortgage bonds currently
outstanding and any that may be issued in the future, would result in a release of the mortgage bonds currently securing these notes, at which
time these notes would become unsecured obligations. Based on the Ameren Illinois mortgage bonds and senior secured notes currently
outstanding, and assuming no early retirement of any series of such securities in full, we do not expect the mortgage bond lien protection
associated with these notes to fall away until 2028.
(h) Ameren Illinois has agreed, during the life of these notes, not to optionally redeem, purchase or otherwise retire in full its CILCO first mortgage
bonds.
(i) Ameren Illinois has agreed, during the life of these notes, not to optionally redeem, purchase or otherwise retire in full its Ameren Illinois
(j)
mortgage bonds.
These bonds are first mortgage bonds issued by Ameren Illinois under the CILCO mortgage indenture and are secured by substantially all
property of the former CILCO. The bonds are callable at 100% of par value.
(k) These bonds are mortgage bonds issued by Ameren Illinois under the Ameren Illinois mortgage indenture and are secured by substantially all
property of the former IP and CIPS. The bonds are callable at 100% of par value. The bonds are also backed by an insurance guarantee policy.
The following table presents the aggregate maturities of long-term debt, including current maturities, for the Ameren
Companies at December 31, 2011:
Ameren
(Parent)(a)
Ameren
Missouri(a)
Ameren
Illinois(a)(b)
Genco(a)
Ameren
Consolidated
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
-
425
-
-
-
425
$
$
178
205
109
120
266
3,077
$
1
150
51
-
129
1,330
$
3,955
$
1,661
$
-
-
-
-
-
825
825
$
179
355
585
120
395
5,232
$
6,866
(a) Excludes unamortized discount and premium of $1 million, $5 million, $8 million and $1 million at Ameren (Parent), Ameren Missouri, Ameren
Illinois and Genco, respectively.
(b) Excludes $5 million related to Ameren Illinois’ long-term debt fair-market value adjustments, which are being amortized to interest expense
over the remaining life of the debt.
All of the Ameren Companies expect to fund maturities of long-term debt, short-term borrowings, credit facility
borrowings, commercial paper and contractual obligations through a combination of cash flow from operations and external
financing. See Note 4 – Short-Term Debt and Liquidity for a discussion of external financing availability.
All classes of Ameren Missouri’s and Ameren Illinois’ preferred stock are entitled to cumulative dividends and have voting
rights. The following table presents the outstanding preferred stock of Ameren Missouri and Ameren Illinois that is not subject
to mandatory redemption. The preferred stock is redeemable, at the option of the issuer, at the prices shown below as of
December 31, 2011 and 2010:
Ameren Missouri:
Without par value and stated value of $100 per share, 25 million shares authorized
130,000 shares . . . . . . . . . . . . . . . . . . . .
40,000 shares . . . . . . . . . . . . . . . . . . . .
150,000 shares . . . . . . . . . . . . . . . . . . . .
40,000 shares . . . . . . . . . . . . . . . . . . . .
213,595 shares . . . . . . . . . . . . . . . . . . . .
200,000 shares . . . . . . . . . . . . . . . . . . . .
20,000 shares . . . . . . . . . . . . . . . . . . . .
14,000 shares . . . . . . . . . . . . . . . . . . . .
$3.50 Series
$3.70 Series
$4.00 Series
$4.30 Series
$4.50 Series
$4.56 Series
$4.75 Series
$5.50 Series A
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Redemption Price (per share)
2011
2010
$
110.00
104.75
105.625
105.00
110.00(a)
102.47
102.176
110.00
$
$
13
4
15
4
21
20
2
1
80
$
$
13
4
15
4
21
20
2
1
80
118
Redemption Price (per share)
2011
2010
Ameren Illinois:
With par value of $100 per share, 2 million shares authorized
4.00% Series
4.08% Series
4.20% Series
4.25% Series
4.26% Series
4.42% Series
4.70% Series
4.90% Series
4.92% Series
5.16% Series
6.625% Series
7.75% Series
144,275 shares . . . . . . . . . . . . . . . . . . . .
45,224 shares . . . . . . . . . . . . . . . . . . . .
23,655 shares . . . . . . . . . . . . . . . . . . . .
50,000 shares . . . . . . . . . . . . . . . . . . . .
16,621 shares . . . . . . . . . . . . . . . . . . . .
16,190 shares . . . . . . . . . . . . . . . . . . . .
18,429 shares . . . . . . . . . . . . . . . . . . . .
73,825 shares . . . . . . . . . . . . . . . . . . . .
49,289 shares . . . . . . . . . . . . . . . . . . . .
50,000 shares . . . . . . . . . . . . . . . . . . . .
124,273.75 shares . . . . . . . . . . . . . . . . . . . .
4,542 shares . . . . . . . . . . . . . . . . . . . .
$101.00
103.00
104.00
102.00
103.00
103.00
103.00
102.00
103.50
102.00
100.00
100.00
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
14
5
2
5
2
2
2
7
5
5
12
1
62
142
$
$
$
14
5
2
5
2
2
2
7
5
5
12
1
62
142
(a)
In the event of voluntary liquidation, $105.50.
Pursuant to the Ameren Illinois Merger: (i) every two
shares of each series of IP preferred stock outstanding
immediately prior to the Ameren Illinois Merger were
automatically converted into one share of a newly created
series of Ameren Illinois preferred stock having the same
payment and redemption terms as the existing series of IP
preferred stock, except to the extent that IP preferred
stockholders exercised their dissenters’ rights in
accordance with Illinois law; and (ii) each outstanding share
of CIPS common and preferred stock remained
outstanding, except to the extent that CIPS preferred
stockholders exercised their dissenters’ rights in
accordance with Illinois law. Stockholders holding 8,337
shares and 423 shares of CIPS and IP preferred stock,
respectively, exercised their dissenter’s rights.
In addition, Ameren has 100 million shares of $0.01
par value preferred stock authorized, with no shares
outstanding. Ameren Missouri has 7.5 million shares of $1
par value preference stock authorized, with no such
preference stock outstanding. Ameren Illinois has
2.6 million shares of no par value preferred stock
authorized, with no shares outstanding.
Ameren
A Form S-3 registration statement was filed by Ameren
with the SEC in June 2011, authorizing the offering of
6 million additional shares of its common stock under
DRPlus. Shares of common stock sold under DRPlus are, at
Ameren’s option, newly issued shares, treasury shares, or
shares purchased in the open market or in privately
negotiated transactions. In 2012, Ameren plans for shares
to be purchased in the open market for DRPlus and its
401(k) plan. Under DRPlus and its 401(k) plan, Ameren
issued 2.2 million, 3.0 million, and 3.2 million shares of
common stock in 2011, 2010, and 2009, respectively,
which were valued at $65 million, $80 million, and
$82 million for the respective years.
In February 2010, CILCORP completed a covenant
defeasance of its remaining outstanding 9.375% senior
bonds due 2029 by depositing $3 million in U.S.
government obligations and cash with the indenture trustee.
This deposit will be used solely to satisfy the principal and
remaining interest obligations on these bonds. In
connection with this covenant defeasance, the lien on the
capital stock of CILCO securing these bonds was released.
Ameren Missouri
In August 2010, Ameren Missouri redeemed all
$33 million of its $7.64 Series preferred stock at $100.85
per share, plus accrued and unpaid dividends.
In September 2010, Ameren Missouri redeemed all
$66 million of its 7.69% Series A subordinated deferrable
interest debentures at a redemption price of 102.692% of
the principal amount plus accrued interest.
Ameren Illinois
In June 2011, Ameren Illinois’ 6.625% $150 million
senior secured notes matured and were repaid and retired
using available cash on hand.
In August 2010, Ameren Illinois (formerly CILCO)
redeemed all of the 111,264 outstanding shares of its
4.50% Series preferred stock at $110 per share and all of
the 79,940 shares of its 4.64% Series preferred stock at
$102 per share, plus, in each case, accrued and unpaid
dividends. These preferred shares were redeemed in
connection with the Ameren Illinois Merger.
In September 2010, Ameren Illinois (formerly CIPS)
redeemed all $40 million of its 7.61% Series 1997-2 first
mortgage bonds at a redemption price of 101.52% of the
principal amount, plus accrued interest. These bonds were
redeemed in connection with the Ameren Illinois Merger.
In September 2010, Ameren contributed to the capital
of Ameren Illinois (formerly IP), without the payment of any
consideration, all of the IP preferred stock owned by
Ameren ($33 million). IP cancelled these preferred shares.
This transaction was completed in connection with the
Ameren Illinois Merger.
119
See Note 16 – Corporate Reorganization and
Discontinued Operations for additional information.
Genco
In November 2010, Genco’s $200 million 8.35% senior
notes matured and were retired with available cash on hand.
Indenture Provisions and Other Covenants
Ameren Missouri’s and Ameren Illinois’ indentures and articles of incorporation include covenants and provisions related
to issuances of first mortgage bonds and preferred stock. Ameren Missouri and Ameren Illinois are required to meet certain
ratios to issue additional first mortgage bonds and preferred stock. However, a failure to achieve these ratios would not result
in a default under these covenants and provisions but would restrict the companies’ ability to issue bonds or preferred stock.
The following table summarizes the required and actual interest coverage ratios for interest charges and dividend coverage
ratios and bonds and preferred stock issuable as of December 31, 2011, at an assumed interest rate of 6% and dividend rate
of 7%.
Ameren Missouri . . . .
Ameren Illinois . . . . . .
Required Interest
Coverage Ratio(a)
≥2.0
≥2.0
Actual Interest
Coverage Ratio
3.2
7.2
Bonds Issuable(b)
$
1,971
3,335(d)
Required Dividend
Coverage Ratio(c)
≥2.5
≥1.5
Actual Dividend
Coverage Ratio
Preferred Stock
Issuable
84.9
3.1
$
1,610
203
(a) Coverage required on the annual interest charges on first mortgage bonds outstanding and to be issued. Coverage is not required in certain
cases when additional first mortgage bonds are issued on the basis of retired bonds.
(b) Amount of bonds issuable based either on required coverage ratios or unfunded property additions, whichever is more restrictive. The amounts
shown also include bonds issuable based on retired bond capacity of $89 million and $765 million at Ameren Missouri and Ameren Illinois,
respectively.
(c) Coverage required on the annual dividend on preferred stock outstanding and to be issued, as required in the respective company’s articles of
incorporation.
(d) Amount of bonds issuable by Ameren Illinois based on unfunded property additions and retired bonds solely under the former IP mortgage
indenture.
Ameren’s indenture does not require Ameren to
comply with any quantitative financial covenants. The
indenture does, however, include certain cross-default
provisions. Specifically, either (1) the failure by Ameren to
pay when due and upon expiration of any applicable grace
period any portion of any Ameren indebtedness in excess of
$25 million or (2) the acceleration upon default of the
maturity of any Ameren indebtedness in excess of
$25 million under any indebtedness agreement, including
the 2010 Credit Agreements, constitutes a default under the
indenture, unless such past due or accelerated debt is
discharged or the acceleration is rescinded or annulled
within a specified period.
Ameren Missouri, Ameren Illinois, Genco and certain
other nonregistrant Ameren subsidiaries are subject to
Section 305(a) of the Federal Power Act, which makes it
unlawful for any officer or director of a public utility, as
defined in the Federal Power Act, to participate in the
making or paying of any dividend from any funds “properly
included in capital account.” The meaning of this limitation
has never been clarified under the Federal Power Act or
FERC regulations. However, FERC has consistently
interpreted the provision to allow dividends to be paid as
long as (1) the source of the dividends is clearly disclosed,
(2) the dividends are not excessive, and (3) there is no self-
dealing on the part of corporate officials. At a minimum,
Ameren believes that dividends can be paid by its
subsidiaries that are public utilities from net income and
retained earnings. In addition, under Illinois law, Ameren
Illinois may not pay any dividend on their respective stock,
unless, among other things, their respective earnings and
earned surplus are sufficient to declare and pay a dividend
after provision is made for reasonable and proper reserves,
or unless Ameren Illinois has specific authorization from the
ICC.
Ameren Illinois’ articles of incorporation require its
dividend payments on common stock to be based on ratios
of common stock to total capitalization and other provisions
related to certain operating expenses and accumulations of
earned surplus. Ameren Illinois committed to FERC to
maintain a minimum 30% ratio of common stock equity to
total capitalization after the Ameren Illinois Merger and
AERG distribution. As of December 31, 2011, Ameren
Illinois’ ratio of common stock equity to total capitalization
was 58%.
Genco’s indenture includes provisions that require
Genco to maintain certain interest coverage and
debt-to-capital ratios in order for Genco to pay dividends, to
make principal or interest payments on subordinated
borrowings, to make loans to or investments in affiliates, or
to incur additional external, third-party indebtedness. The
following table summarizes these ratios for the 12 months
ended and as of December 31, 2011:
Required
Interest
Coverage
Ratio
≥1.75(a)/2.50(b)
Actual
Interest
Coverage
Ratio
4.3
Required
Debt-to-
Capital
Ratio
≤60%(b)
Actual
Debt-to-
Capital
Ratio
43%
Genco . . . . .
(a) A minimum interest coverage ratio of 1.75 is required for Genco
to make certain restricted payments, as defined, including
specified dividend payments and, principal and interest payments
on subordinated borrowings. As of the date of the restricted
payment, the minimum ratio must have been achieved for the
120
most recently ended four fiscal quarters and projected by
management to be achieved for each of the subsequent four
six-month periods. Investments in the non-state-regulated
subsidiary money pool and repayments of non-state-regulated
subsidiary money pool borrowings are not subject to this
incurrence test.
(b) A minimum interest coverage ratio of 2.50 for the most recently
ended four fiscal quarters and a debt-to-capital ratio of no greater
than 60% are required for Genco to incur additional
indebtedness, as defined, other than permitted indebtedness, as
defined, for borrowed money. The ratios must be computed on a
pro forma basis considering the additional indebtedness to be
incurred and the related interest expense. Non-state-regulated
subsidiary money pool borrowings are defined as permitted
indebtedness and are not subject to these incurrence tests. Credit
facility borrowings, including borrowings under the 2010 Genco
Credit Agreement, and other borrowings from third-party,
external sources are included in the definition of indebtedness
and are subject to these incurrence tests.
NOTE 6 – OTHER INCOME AND EXPENSES
Genco’s debt incurrence-related ratio restrictions under
its indenture may be disregarded if both Moody’s and S&P
reaffirm the ratings of Genco in place at the time of the debt
incurrence after considering the additional indebtedness.
In order for the Ameren Companies to issue securities
in the future, they will have to comply with all applicable
requirements in effect at the time of any such issuances.
Off-Balance-Sheet Arrangements
At December 31, 2011, none of the Ameren Companies
had any off-balance-sheet financing arrangements, other
than operating leases entered into in the ordinary course of
business. None of the Ameren Companies expect to engage
in any significant off-balance-sheet financing arrangements
in the near future.
The following table presents the components of “Other Income and Expenses” in the Ameren Companies’ statements of
income for the years ended December 31, 2011, 2010, and 2009:
2011
2010
2009
Ameren:(a)
Miscellaneous income:
Interest and dividend income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest income on industrial development revenue bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allowance for equity funds used during construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous expense:
Donations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Miscellaneous income:
Interest and dividend income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest income on industrial development revenue bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allowance for equity funds used during construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous expense:
Donations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Miscellaneous income:
Interest and dividend income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Allowance for equity funds used during construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous expense:
Donations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
Miscellaneous income:
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous expense:
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total miscellaneous expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
4
28
34
3
69
8
15
23
2
28
30
1
61
3
7
10
1
4
2
7
1
5
6
1
1
-
-
121
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
5
28
52
5
90
19
14
33
3
28
50
2
83
8
5
13
1
2
4
7
5
8
13
1
1
1
1
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
2
28
36
5
71
12
11
23
1
28
33
1
63
3
4
7
6
2
4
12
4
6
10
1
1
1
1
NOTE 7 – DERIVATIVE FINANCIAL INSTRUMENTS
We use derivatives principally to manage the risk of
changes in market prices for natural gas, coal, diesel,
power, and uranium. Such price fluctuations may cause the
following:
‰
an unrealized appreciation or depreciation of our
contracted commitments to purchase or sell when
purchase or sale prices under the commitments are
compared with current commodity prices;
‰ market values of coal, natural gas, and uranium
inventories that differ from the cost of those
commodities in inventory; and
‰
actual cash outlays for the purchase of these
commodities that differ from anticipated cash outlays.
The derivatives that we use to hedge these risks are
governed by our risk management policies for forward
contracts, futures, options, and swaps. Our net positions
are continually assessed within our structured hedging
programs to determine whether new or offsetting
transactions are required. The goal of the hedging program
is generally to mitigate financial risks while ensuring that
sufficient volumes are available to meet our requirements.
Contracts we enter into as part of our risk management
program may be settled financially, settled by physical
delivery, or net settled with the counterparty.
The following table presents open gross derivative volumes by commodity type as of December 31, 2011 and 2010:
Commodity
NPNS
Contracts(a)
Cash Flow
Hedges(b)
Other
Derivatives(c)
Derivatives That Qualify for
Regulatory Deferral(d)
2011
2010
2011
2010
2011
2010
2011
2010
Quantity (in millions, except as indicated)
Coal (in tons)
Ameren Missouri . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . .
116
24
7
147
Fuel oils (in gallons)(g)
Ameren Missouri . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas (in mmbtu)
Ameren Missouri . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power (in megawatthours)
Ameren Missouri . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(f) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium (pounds in thousands)
(e)
(e)
(e)
(e)
8
42
(e)
(e)
50
1
11
(e)
61
73
46
21
6
73
(e)
(e)
(e)
(e)
13
85
(e)
(e)
98
2
(e)
(e)
61
63
Ameren Missouri & Ameren . . . . . . . . . . .
5,553
5,810
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
17
17
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
(e)
2
2
(e)
(e)
(e)
(e)
(e)
(e)
27
9
36
9
(e)
7
1
17
1
(e)
-
30
31
(e)
(e)
(e)
(e)
(e)
(e)
43
12
55
2
(e)
3
16
21
1
(e)
3
57
61
(e)
(e)
(e)
(e)
(e)
53
(e)
(e)
53
19
174
(e)
(e)
193
6
24
(e)
(9)
21
(e)
(e)
(e)
(e)
80
(e)
(e)
80
21
173
(e)
(e)
194
5
26
(e)
(13)
18
148
185
(a) Contracts through December 2017, March 2015, September 2035, and October 2024 for coal, natural gas, power, and uranium, respectively, as
of December 31, 2011.
(b) Contracts through December 2014 for power as of December 31, 2011.
(c) Contracts through October 2014, December 2012, and December 2015 for fuel oils, natural gas, and power, respectively, as of December 31,
2011.
(d) Contracts through October 2014, October 2016, May 2032, and December 2013 for fuel oils, natural gas, power, and uranium, respectively, as
of December 31, 2011.
(e) Not applicable.
(f)
Includes AERG contracts for coal and fuel oils, Marketing Company contracts for natural gas and power, and intercompany eliminations for
power.
(g) Fuel oils consist of heating and crude oil.
122
Authoritative accounting guidance regarding derivative
instruments requires that all contracts considered to be
derivative instruments be recorded on the balance sheet at
their fair values, unless the NPNS exception applies. See
Note 8 – Fair Value Measurements for discussion of our
methods of assessing the fair value of derivative
instruments. Many of our physical contracts, such as our
coal and purchased power contracts, qualify for the NPNS
exception to derivative accounting rules. The revenue or
expense recorded in connection with NPNS contracts is
recognized at the contract price upon physical delivery.
If we determine that a contract meets the definition of
a derivative and is not eligible for the NPNS exception, we
review the contract to determine if it qualifies for hedge
accounting treatment. We also consider whether gains or
losses resulting from such derivatives qualify for regulatory
deferral. Contracts that qualify for cash flow hedge
accounting treatment are recorded at fair value with
changes in fair value charged or credited to accumulated
OCI in the period in which the change occurs, to the extent
the hedge is effective. To the extent the hedge is ineffective,
the related changes in fair value are charged or credited to
the statement of income in the period in which the change
occurs. When the contract is settled or delivered, the net
gain or loss is recorded in the statement of income.
Derivative contracts that qualify for regulatory deferral
are recorded at fair value, with changes in fair value
recorded as regulatory assets or regulatory liabilities in the
period in which the change occurs. Ameren Missouri and
Ameren Illinois believe derivative gains and losses deferred
as regulatory assets and regulatory liabilities are probable of
recovery or refund through future rates charged to
customers. Regulatory assets and regulatory liabilities are
amortized to operating income as related losses and gains
are reflected in rates charged to customers. Therefore,
gains and losses on these derivatives have no effect on
operating income.
Certain derivative contracts are entered into on a
regular basis as part of our risk management program but
do not qualify for the NPNS exception, hedge accounting, or
regulatory deferral accounting. Such contracts are recorded
at fair value, with changes in fair value charged or credited
to the statement of income in the period in which the
change occurs.
Authoritative accounting guidance permits companies
to offset fair value amounts recognized for the right to
reclaim cash collateral (a receivable) or the obligation to
return cash collateral (a liability) against fair value amounts
recognized for derivative instruments that are executed with
the same counterparty under the same master netting
arrangement. The Ameren Companies did not elect to adopt
this guidance for any eligible financial instruments or other
items.
The following table presents the carrying value and balance sheet location of all derivative instruments as of
December 31, 2011 and 2010:
Balance Sheet Location
Ameren(a)
Ameren
Missouri
Ameren
Illinois
Genco
2011:
Derivative assets designated as hedging instruments
Commodity contracts:
Power . . . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities designated as hedging instruments
Commodity contracts:
Power . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . .
Total liabilities . . . . . . . . . . . . . . . . . . . . . .
Derivative assets not designated as hedging instruments(c)
Commodity contracts:
Fuel oils . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
$
$
$
$
$
$
8
16
24
1
1
29
-
8
6
-
-
72
-
99
Total assets . . . . . . . . . . . . . . . . . . . . . . . .
$
214
$
(b)
-
-
-
-
(b)
17
6
(b)
2
-
(b)
30
-
55
$
$
$
$
$
$
(b)
-
-
-
-
(b)
-
-
(b)
1
1
(b)
-
77
79
$
$
$
$
$
$
-
-
-
-
-
10
-
1
2
-
-
-
-
-
13
123
Balance Sheet Location
Ameren(a)
Ameren
Missouri
Ameren
Illinois
Genco
Derivative liabilities not designated as hedging instruments(c)
Commodity contracts:
Fuel oils . . . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . .
Power . . . . . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
MTM derivative liabilities - affiliates . . . . . .
Other current liabilities . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . .
Other deferred credits and liabilities . . . . . .
Uranium
Total liabilities . . . . . . . . . . . . . . . . . . . . . .
2010:
Derivative assets designated as hedging instruments
Commodity contracts:
Power . . . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities designated as hedging instruments
Commodity contracts:
Power . . . . . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
Total liabilities . . . . . . . . . . . . . . . . . . . . . .
Derivative assets not designated as hedging instruments(c)
Commodity contracts:
Fuel oils . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Other assets . . . . . . . . . . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . . . MTM derivative assets . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities not designated as hedging instruments(c)
Commodity contracts:
Fuel oils . . . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . .
Natural gas . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . .
Power . . . . . . . . . . . . . . . . MTM derivative liabilities . . . . . . . . . . . . . . .
MTM derivative liabilities - affiliates . . . . . .
Other current liabilities . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . .
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
2
-
106
-
92
53
(b)
-
26
1
280
3
2
5
1
1
42
-
22
4
-
1
78
-
20
2
-
169
12
-
1
87
-
84
61
(b)
-
7
Total liabilities . . . . . . . . . . . . . . . . . . . . . .
$
252
$
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) Balance sheet line item not applicable to registrant.
Includes derivatives subject to regulatory deferral.
(c)
(b)
1
(b)
13
13
(b)
(b)
9
-
1
37
(b)
-
-
(b)
-
(b)
24
13
(b)
1
-
(b)
8
-
(b)
2
48
(b)
7
-
(b)
11
13
(b)
(b)
6
-
37
$
$
$
$
$
$
$
$
$
$
-
-
90
-
79
9
200
-
8
-
386
(b)
-
-
-
-
(b)
-
-
(b)
1
1
(b)
2
6
(b)
-
10
-
-
-
73
-
70
9
172
-
179
503
$
$
$
$
$
$
$
$
$
1
-
2
-
-
-
-
-
-
-
3
-
-
-
-
-
14
-
7
1
-
-
11
-
-
-
-
33
4
-
-
2
-
-
3
5
-
-
$
14
124
The following table presents the cumulative amount of pretax net gains (losses) on all derivative instruments in
accumulated OCI and regulatory assets or regulatory liabilities as of December 31, 2011 and 2010:
2011:
Cumulative gains (losses) deferred in accumulated OCI:
Power derivative contracts(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
Interest rate derivative contracts(c)(d)
Cumulative gains (losses) deferred in regulatory liabilities or assets:
. . . . . . . . . . . . . . . . . . . . . . . . . . .
Fuel oils derivative contracts(e)
Natural gas derivative contracts(f)
. . . . . . . . . . . . . . . . . . . . . . . . .
Power derivative contracts(g) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium derivative contracts(h)
2010:
Cumulative gains (losses) deferred in accumulated OCI:
Power derivative contracts(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . .
Interest rate derivative contracts(c)(d)
Cumulative gains (losses) deferred in regulatory liabilities or assets:
. . . . . . . . . . . . . . . . . . . . . . . . . . .
Fuel oils derivative contracts(e)
Natural gas derivative contracts(f)
. . . . . . . . . . . . . . . . . . . . . . . . .
Power derivative contracts(g) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium derivative contracts(h)
Ameren
Ameren
Missouri
Ameren
Illinois
Genco
Other(a)
$
$
19
(8)
19
(191)
81
(1)
8
(9)
19
(165)
1
2
$
-
-
$
-
-
$
-
(8)
19
(24)
21
(1)
-
(167)
(140)
-
-
-
-
-
$
-
-
$
-
-
$
-
(9)
19
(24)
3
2
-
(141)
(352)
-
-
-
-
-
$
$
19
-
-
-
200
-
8
-
-
-
350
-
(c)
Includes amounts for Marketing Company and intercompany eliminations.
(a)
(b) Represents net gains associated with power derivative contracts at Ameren. These contracts are a partial hedge of electricity price exposure
through December 2014 as of December 31, 2011. Current gains of $5 million and $8 million were recorded at Ameren as of December 31,
2011, and December 31, 2010, respectively.
Includes net gains associated with interest rate swaps at Genco that were a partial hedge of the interest rate on debt issued in June 2002. The
swaps cover the first 10 years of debt that has a 30-year maturity, and the gain in OCI is amortized over a 10-year period that began in June
2002. The carrying value at December 31, 2011, and December 31, 2010 was less than $1 million and less than $1 million, respectively. The
balance of the gain will be amortized by June 2012.
Includes net losses associated with interest rate swaps at Genco. The swaps were executed during the fourth quarter of 2007 as a partial hedge
of interest rate risks associated with Genco’s April 2008 debt issuance. The loss on the interest rate swaps is being amortized over a 10-year
period that began in April 2008. The carrying value at December 31, 2011, and December 31, 2010, was a loss of $9 million and a loss of
$10 million, respectively. Over the next 12 months, $1.4 million of the loss will be amortized.
(d)
(e) Represents net gains on fuel oils derivative contracts at Ameren Missouri. These contracts are a partial hedge of Ameren Missouri’s
transportation costs for coal through October 2014 as of December 31, 2011. Current gains deferred as regulatory liabilities include $16 million
and $16 million at Ameren and Ameren Missouri as of December 31, 2011, respectively. Current losses deferred as regulatory assets include
$1 million and $1 million at Ameren and Ameren Missouri as of December 31, 2011, respectively. Current gains deferred as regulatory liabilities
include $13 million and $13 million at Ameren and Ameren Missouri as of December 31, 2010, respectively. Current losses deferred as
regulatory assets include $6 million and $6 million at Ameren and Ameren Missouri as of December 31, 2010, respectively.
(f) Represents net losses associated with natural gas derivative contracts. These contracts are a partial hedge of natural gas requirements through
October 2016 at Ameren, Ameren Missouri, and Ameren Illinois in each case as of December 31, 2011. Current gains deferred as regulatory
liabilities include $1 million and $1 million at Ameren and Ameren Illinois, respectively, as of December 31, 2011. Current losses deferred as
regulatory assets include $101 million, $11 million, and $90 million at Ameren, Ameren Missouri and Ameren Illinois, respectively, as of
December 31, 2011. Current gains deferred as regulatory liabilities include $2 million, $1 million, and $1 million at Ameren, Ameren Missouri,
and Ameren Illinois, respectively, as of December 31, 2010. Current losses deferred as regulatory assets include $84 million, $11 million, and
$73 million at Ameren, Ameren Missouri and Ameren Illinois, respectively, as of December 31, 2010.
(g) Represents net losses associated with power derivative contracts. These contracts are a partial hedge of power price requirements through May
2032 at Ameren and Ameren Illinois and through December 2015 at Ameren Missouri, in each case as of December 31, 2011. Current gains
deferred as regulatory liabilities include $29 million and $29 million at Ameren and Ameren Missouri, respectively, as of December 31, 2011.
Current losses deferred as regulatory assets include $17 million, $8 million, and $209 million at Ameren, Ameren Missouri and Ameren Illinois,
respectively, as of December 31, 2011. Current gains deferred as regulatory liabilities include $8 million, $6 million, and $2 million at Ameren,
Ameren Missouri and Ameren Illinois, respectively, as of December 31, 2010. Current losses deferred as regulatory assets include $13 million,
$3 million, and $181 million at Ameren, Ameren Missouri and Ameren Illinois, respectively, as of December 31, 2010.
(h) Represents net gains(losses) on uranium derivative contracts at Ameren Missouri. These contracts are a partial hedge of our uranium
requirements through December 2013 as of December 31, 2011. Current losses deferred as regulatory assets include less than $1 million and
less than $1 million at Ameren and Ameren Missouri as of December 31, 2011, respectively. Current gains deferred as regulatory liabilities
include $2 million at Ameren and $2 million at Ameren Missouri as of December 31, 2010.
125
Derivative instruments are subject to various credit-related losses in the event of nonperformance by counterparties to the
transaction. Exchange-traded contracts are supported by the financial and credit quality of the clearing members of the
respective exchanges and have nominal credit risk. In all other transactions, we are exposed to credit risk. Our credit risk
management program involves establishing credit limits and collateral requirements for counterparties, using master trading
and netting agreements, and reporting daily exposure to senior management.
We believe that entering into master trading and netting agreements mitigates the level of financial loss that could result
from default by allowing net settlement of derivative assets and liabilities. We generally enter into the following master trading
and netting agreements: (1) the International Swaps and Derivatives Association Agreement, a standardized financial natural
gas and electric contract; (2) the Master Power Purchase and Sale Agreement, created by the Edison Electric Institute and the
National Energy Marketers Association, a standardized contract for the purchase and sale of wholesale power; and (3) the
North American Energy Standards Board Inc. agreement, a standardized contract for the purchase and sale of natural gas.
These master trading and netting agreements allow the counterparties to net settle sale and purchase transactions. Further,
collateral requirements are calculated at a master trading and netting agreement level by counterparty.
Concentrations of Credit Risk
In determining our concentrations of credit risk related to derivative instruments, we review our individual counterparties
and categorize each counterparty into one of eight groupings according to the primary business in which each engages. The
following table presents the maximum exposure, as of December 31, 2011, and 2010, if counterparty groups were to fail
completely to perform on contracts by grouping. The maximum exposure is based on the gross fair value of financial
instruments, including NPNS contracts, which excludes collateral held, and does not consider the legally binding right to net
transactions based on master trading and netting agreements.
Affiliates(a)
Coal
Producers
Commodity
Marketing
Companies
Electric
Utilities
Financial
Companies
Municipalities/
Cooperatives
Oil and Gas
Companies
Retail
Companies
Total
$
$
$
2011:
AMO . . . . . . .
AIC . . . . . . . .
Genco . . . . . .
Other(b) . . . . .
Ameren . . . . .
2010:
AMO . . . . . . .
AIC . . . . . . . .
Genco . . . . . .
Other(b) . . . . .
Ameren . . . . .
$
1
-
-
275
276
-
-
-
410
410
$
$
$
$
35
-
1
1
37
21
-
6
3
30
$
$
$
$
1
84
1
3
89
1
3
2
10
16
$
$
$
$
4
-
2
10
16
2
-
1
19
22
$
$
$
$
26
1
6
51
84
5
1
1
65
72
$
$
$
$
4
-
-
194
198
11
-
-
539
550
$
$
$
$
$
$
$
-
-
3
-
3
1
-
6
3
10
$
-
-
-
87
87
-
-
-
72
72
$
$
$
71
85
13
621
790
41
4
16
1,121
$
1,182
(a) Primarily composed of Marketing Company’s exposure to Ameren Illinois related to financial contracts. The exposure is not eliminated at the
consolidated Ameren level for purposes of this disclosure, as it is calculated without regard to the offsetting affiliate counterparty’s liability
position. See Note 14 – Related Party Transactions for additional information on these financial contracts.
Includes amounts for Marketing Company, AERG, and AFS.
(b)
The potential loss on counterparty exposures is reduced by the application of master trading and netting agreements and
collateral held to the extent of reducing the exposure to zero. Collateral includes both cash collateral and other collateral held.
The amount of cash collateral held by Marketing Company from counterparties and based on the contractual rights under the
agreements to seek collateral and the maximum exposure as calculated under the individual master trading and netting
agreements was less than $1 million and $1 million from retail companies at December 31, 2011 and 2010, respectively. There
126
was no cash collateral held at Ameren registrant subsidiaries. As of December 31, 2011, other collateral used to reduce
exposure consisted of letters of credit in the amount of $9 million, $1 million, $1 million, and $7 million held by Ameren,
Ameren Missouri, Genco, and Marketing Company, respectively. As of December 31, 2010, other collateral used to reduce
exposure consisted of letters of credit in the amount of $28 million and $1 million held by Ameren and Ameren Illinois,
respectively. The following table presents the potential loss after consideration of the application of master trading and netting
agreements and collateral held as of December 31, 2011 and 2010:
Affiliates(a)
Coal
Producers
Commodity
Marketing
Companies
Electric
Utilities
Financial
Companies
Municipalities/
Cooperatives
Oil and Gas
Companies
Retail
Companies
Total
$
$
$
2011:
AMO . . . . . . .
AIC . . . . . . . .
Genco . . . . . .
. . . . .
Other(b)
Ameren . . . . .
2010:
AMO . . . . . . .
AIC . . . . . . . .
Genco . . . . . .
. . . . .
Other(b)
Ameren . . . . .
$
1
-
-
273
274
-
-
-
404
404
$
$
$
35
-
-
-
35
8
-
1
1
$
$
$
1
84
-
3
88
-
2
1
8
$
10
$
11
$
$
$
$
3
-
1
5
9
1
-
1
7
9
$
$
$
$
22
-
1
42
65
2
-
1
56
59
$
$
$
$
4
-
-
187
191
10
-
-
513
523
$
$
$
$
-
-
2
-
2
-
-
5
2
7
$
$
$
$
-
-
-
86
86
-
-
-
71
71
$
$
$
$
66
84
4
596
750
21
2
9
1,062
1,094
(a) Primarily comprised of Marketing Company’s exposure to Ameren Illinois related to financial contracts. The exposure is not eliminated at the
consolidated Ameren level for purposes of this disclosure, as it is calculated without regard to the offsetting affiliate counterparty’s liability
position. See Note 14 – Related Party Transactions for additional information on these financial contracts.
Includes amounts for Marketing Company, AERG, and AFS.
(b)
Derivative Instruments with Credit Risk-Related Contingent Features
Our commodity contracts contain collateral provisions tied to the Ameren Companies’ credit ratings. If we were to
experience an adverse change in our credit ratings, or if a counterparty with reasonable grounds for uncertainty regarding
performance of an obligation requested adequate assurance of performance, additional collateral postings might be required.
The following table presents, as of December 31, 2011, and 2010, the aggregate fair value of all derivative instruments with
credit risk-related contingent features in a gross liability position, the cash collateral posted, and the aggregate amount of
additional collateral that could be required to be posted with counterparties. The additional collateral required is the net liability
position allowed under the master trading and netting agreements assuming (1) the credit risk-related contingent features
underlying these agreements were triggered on December 31, 2011, or 2010, respectively, and (2) those counterparties with
rights to do so requested collateral:
Aggregate Fair Value of
Derivative Liabilities(a)
Cash
Collateral Posted
Potential Aggregate Amount of
Additional Collateral Required(b)
2011:
Ameren Missouri
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
102
220
55
79
456
105
233
31
62
431
$
$
$
$
8
96
1
11
116
7
109
-
18
134
$
$
$
$
86
125
58
63
332
93
111
28
42
274
(a) Prior to consideration of master trading and netting agreements and including NPNS contract exposures.
(b) As collateral requirements with certain counterparties are based on master trading and netting agreements, the aggregate amount of additional
collateral required to be posted is determined after consideration of the effects of such agreements.
Includes amounts for Marketing Company and Ameren (parent).
(c)
127
Cash Flow Hedges
The following table presents the pretax net gain or loss for the year ended December 31, 2011 and 2010, associated with
derivative instruments designated as cash flow hedges:
Gain (Loss)
Recognized in OCI(a)
Location of (Gain) Loss
Reclassified from
Accumulated OCI into
Income(b)
(Gain) Loss
Reclassified from
Accumulated OCI
into Income(b)
Location of Gain (Loss)
Recognized in Income(c)
Gain (Loss)
Recognized
in Income(c)
2011:
Ameren:(d)
Power . . . . . . . . .
. . .
Interest rate(e)
Genco:
Interest rate(e)
. . .
2010:
Ameren:(d)
Power . . . . . . . . .
. . .
Interest rate(e)
Genco:
Interest rate(e)
. . .
$
$
6
-
-
(2)
-
-
Operating Revenues - Electric . .
Interest Charges . . . . . . . . . . . .
$
Interest Charges . . . . . . . . . . . .
5
(f)
(f)
Operating Revenues - Electric . .
Interest Charges . . . . . . . . . . . .
Interest Charges . . . . . . . . . . . .
Operating Revenues - Electric . .
Interest Charges . . . . . . . . . . . .
$
(14)
(f)
Operating Revenues - Electric . .
Interest Charges . . . . . . . . . . . .
Interest Charges . . . . . . . . . . . .
(f)
Interest Charges . . . . . . . . . . . .
$
$
(10)
-
-
(3)
-
-
(a) Effective portion of gain (loss).
(b) Effective portion of (gain) loss on settlements.
(c)
(d)
(e) Represents interest rate swaps settled in prior periods. The cumulative gain and loss on the interest rate swaps is being amortized into income
Ineffective portion of gain (loss) and amount excluded from effectiveness testing.
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
over a 10-year period.
Less than $1 million.
(f)
Other Derivatives
The following table represents the net change in market value associated with derivatives not designated as hedging
instruments for the years ended December 31, 2011 and 2010:
Location of Gain (Loss)
Recognized in Income
Gain (Loss) Recognized
in Income
2011
2010
Ameren(a)
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas (generation)
. . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . .
Operating Expenses - Fuel
Operating Expenses - Fuel
. . . . . . . . . . . . .
Operating Revenues - Electric . . . . . . . . . .
Total
Ameren Missouri
Natural gas (generation)
. . . . . . . . . . . . . .
Operating Expenses - Fuel
. . . . . . . . . . . . .
Genco
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas (generation)
. . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . .
Operating Expenses - Fuel
Operating Expenses - Fuel
. . . . . . . . . . . . .
Operating Revenues . . . . . . . . . . . . . . . . . .
Total
$
$
$
$
$
(1)
2
(2)
(1)
(1)
(1)
2
(3)
(2)
$
$
$
$
$
9
-
9
18
1
7
-
1
8
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
128
Derivatives Subject to Regulatory Deferral
NOTE 8 – FAIR VALUE MEASUREMENTS
The following table represents the net change in
market value associated with derivatives that qualify for
regulatory deferral for the years ended December 31, 2011
and 2010:
Ameren(a)
Ameren
Missouri
Fuel oils . . . . . . . . . . . . .
Natural gas . . . . . . . . . . .
Power . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . .
Total
Fuel oils . . . . . . . . . . . . .
Natural gas . . . . . . . . . . .
Power . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . .
Total
Ameren
Illinois
Natural gas . . . . . . . . . . .
Power . . . . . . . . . . . . . . .
Total
Gain (Loss) Recognized
In Regulatory Liabilities
or Regulatory Assets
2010
2011
$
$
$
$
$
$
-
(26)
80
(3)
51
-
-
18
(3)
15
(26)
212
186
$
$
$
$
$
$
14
(91)
12
4
(61)
14
(11)
4
4
11
(80)
70
(10)
(a)
Includes amounts for intercompany eliminations.
As part of the 2007 Illinois Electric Settlement
Agreement and subsequent Illinois power procurement
processes, Ameren Illinois entered into financial contracts
with Marketing Company. These financial contracts are
derivative instruments. They are accounted for as cash flow
hedges by Marketing Company and as derivatives that
qualify for regulatory deferral by Ameren Illinois.
Consequently, Ameren Illinois and Marketing Company
record the fair value of the contracts on their respective
balance sheets and the changes to the fair value in
regulatory assets or liabilities by Ameren Illinois and OCI by
Marketing Company. In Ameren’s consolidated financial
statements, all financial statement effects of the derivative
instruments entered into among affiliates were eliminated.
See Note 14 – Related Party Transactions for additional
information on these financial contracts. The following table
presents the fair value of the financial contracts included on
Ameren Illinois’ balance sheet at December 31, 2011 and
2010:
Ameren MTM derivative liabilities - affiliates . . . $
Illinois
Other deferred credits and liabilities . . .
Total $
2011
2010
200
-
200
$
$
172
178
350
Fair value is defined as the exchange price that would
be received for an asset or paid to transfer a liability (an exit
price) in the principal or most advantageous market for the
asset or liability in an orderly transaction between market
participants on the measurement date. We use various
methods to determine fair value, including market, income,
and cost approaches. With these approaches, we adopt
certain assumptions that market participants would use in
pricing the asset or liability, including assumptions about
market risk or the risks inherent in the inputs to the
valuation. Inputs to valuation can be readily observable,
market-corroborated, or unobservable. We use valuation
techniques that maximize the use of observable inputs and
minimize the use of unobservable inputs. Authoritative
accounting guidance established a fair value hierarchy that
prioritizes the inputs used to measure fair value. All financial
assets and liabilities carried at fair value are classified and
disclosed in one of the following three hierarchy levels:
Level 1: Inputs based on quoted prices in active markets for
identical assets or liabilities. Level 1 assets and liabilities are
primarily exchange-traded derivatives and assets, including
cash and cash equivalents and listed equity securities, such
as those held in Ameren Missouri’s Nuclear
Decommissioning Trust Fund.
Level 2: Market-based inputs corroborated by third-party
brokers or exchanges based on transacted market data.
Level 2 assets and liabilities include certain assets held in
Ameren Missouri’s Nuclear Decommissioning Trust Fund,
including corporate bonds and other fixed-income
securities, U.S. treasury and agency securities, and certain
over-the-counter derivative instruments, including natural
gas swaps and financial power transactions. Derivative
instruments classified as Level 2 are valued by corroborated
observable inputs, such as pricing services or prices from
similar instruments that trade in liquid markets. Our
development and corroboration process entails obtaining
multiple quotes or prices from outside sources. To derive
our forward view to price our derivative instruments at fair
value, we average the midpoints of the bid/ask spreads. To
validate forward prices obtained from outside parties, we
compare the pricing to recently settled market transactions.
Additionally, a review of all sources is performed to identify
any anomalies or potential errors. Further, we consider the
volume of transactions on certain trading platforms in our
reasonableness assessment of the averaged midpoint.
Level 3: Unobservable inputs that are not corroborated by
market data. Level 3 assets and liabilities are valued by
129
internally developed models and assumptions or
methodologies that use significant unobservable inputs.
Level 3 assets and liabilities include derivative instruments
that trade in less liquid markets, where pricing is largely
unobservable, including the financial contracts entered into
between Ameren Illinois and Marketing Company. We value
Level 3 instruments by using pricing models with inputs
that are often unobservable in the market, as well as certain
internal assumptions. Our development and corroboration
process entails obtaining multiple quotes or prices from
outside sources. As a part of our reasonableness review, an
evaluation of all sources is performed to identify any
anomalies or potential errors.
We perform an analysis each quarter to determine the
appropriate hierarchy level of the assets and liabilities
subject to fair value measurements. Financial assets and
liabilities are classified in their entirety according to the
lowest level of input that is significant to the fair value
measurement. All assets and liabilities whose fair value
measurement is based on significant unobservable inputs
are classified as Level 3.
In accordance with applicable authoritative accounting
guidance, we consider nonperformance risk in our valuation
of derivative instruments by analyzing the credit standing of
our counterparties and considering any counterparty credit
enhancements (e.g., collateral). The guidance also requires
that the fair value measurement of liabilities reflect the
nonperformance risk of the reporting entity, as applicable.
Therefore, we have factored the impact of our credit
standing as well as any potential credit enhancements into
the fair value measurement of both derivative assets and
derivative liabilities. Included in our valuation, and based on
current market conditions, is a valuation adjustment for
counterparty default derived from market data such as the
price of credit default swaps, bond yields, and credit
ratings. Ameren recorded net losses of $2 million, net gains
of less than $1 million, and net losses of less than
$1 million in 2011, 2010 and 2009, respectively, related to
valuation adjustments for counterparty default risk. Genco
recorded net losses of less than $1 million, net gains of less
than $1 million, and net gains of less than $1 million in
2011, 2010, and 2009, respectively, related to valuation
adjustments for counterparty default risk. At December 31,
2011, the counterparty default risk (asset)/liability valuation
adjustment related to derivative contracts totaled $1 million,
less than $1 million, $19 million, and less than $(1) million
for Ameren, Ameren Missouri, Ameren Illinois and Genco,
respectively. At December 31, 2010, the counterparty
default risk liability valuation adjustment related to
derivative contracts totaled $2 million, less than $1 million,
$21 million, and less than $1 million for Ameren, Ameren
Missouri, Ameren Illinois and Genco, respectively.
130
The following table sets forth, by level within the fair value hierarchy, our assets and liabilities measured at fair value on a
recurring basis as of December 31, 2011:
Quoted Prices in
Active Markets for
Identical Assets
or Liabilities
(Level 1)
Significant Other
Observable
Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Total
Assets:
Ameren(a)
Derivative assets - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Nuclear Decommissioning Trust Fund(c):
Cash and cash equivalents . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . .
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . .
Asset-backed securities . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative assets - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear Decommissioning Trust Fund(c):
Cash and cash equivalents . . . . . . . . . . . . . . .
Equity securities:
Ameren
Missouri
33
4
-
3
234
-
-
-
-
-
20
2
-
3
U.S. large capitalization . . . . . . . . . . . . .
234
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . .
Asset-backed securities . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
Illinois
Derivative assets - commodity contracts(b):
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco
Derivative assets - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities:
Ameren(a)
Ameren
Missouri
$
Derivative liabilities - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
Illinois
Derivative liabilities - commodity contracts(b):
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco
Derivative liabilities - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . .
-
-
-
-
-
-
-
10
2
2
22
-
-
1
12
-
-
7
-
1
2
$
$
-
-
2
-
-
44
1
65
10
1
-
-
1
-
-
44
1
65
10
1
-
-
-
-
-
-
2
-
-
-
1
-
-
-
-
-
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) The derivative asset and liability balances are presented net of counterparty credit considerations.
(c) Balance excludes $(1) million of receivables, payables, and accrued income, net.
131
$
4
2
193
$
-
-
-
-
-
-
-
3
-
29
-
-
-
-
-
-
-
2
77
1
-
-
176
78
1
-
14
8
1
162
217
-
-
$
$
37
6
195
3
234
44
1
65
10
1
23
2
30
3
234
44
1
65
10
1
2
77
11
2
2
198
80
1
1
26
9
1
169
217
1
2
The following table sets forth, by level within the fair value hierarchy, our assets and liabilities measured at fair value on a
recurring basis as of December 31, 2010:
Quoted Prices in
Active Markets for
Identical Assets
or Liabilities
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant
Other
Unobservable
Inputs
(Level 3)
Total
$
Assets:
Ameren(a)
Ameren
Missouri
Derivative assets - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear Decommissioning Trust Fund(c):
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
$
-
3
-
-
1
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . .
228
Debt securities:
$
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . . . . . . . . .
Asset-backed securities . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative assets - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Nuclear Decommissioning Trust Fund(c):
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
-
-
-
-
-
-
-
-
-
1
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . .
228
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . . . . . . . . .
Asset-backed securities . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
Illinois
Derivative assets - commodity contracts(b):
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco
Derivative assets - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities:
Ameren(a)
Derivative liabilities - commodity contracts(b):
-
-
-
-
-
-
-
-
1
-
-
-
17
-
-
-
40
2
50
14
1
-
-
3
-
-
-
40
2
50
14
1
-
-
-
-
-
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
21
-
$
-
-
19
$
Ameren
Missouri
Ameren
Illinois
Derivative liabilities - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities - commodity contracts(b):
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco
Derivative liabilities - commodity contracts(b):
Fuel oils . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
-
9
-
7
-
-
2
-
-
-
3
-
-
-
-
-
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) The derivative asset and liability balances are presented net of counterparty credit considerations.
(c) Balance excludes $1 million of receivables, payables, and accrued income, net.
132
64
2
86
2
-
-
-
-
-
-
-
37
1
5
2
-
-
-
-
-
-
-
2
8
21
-
11
13
150
50
7
15
3
136
360
4
-
8
$
$
64
5
103
2
1
228
40
2
50
14
1
37
1
8
2
1
228
40
2
50
14
1
2
8
21
1
11
13
171
69
7
24
6
143
360
4
2
8
In January 2010, the FASB issued amended authoritative guidance regarding fair value measurements. This guidance
required disclosures regarding significant transfers into and out of Level 1 and Level 2 fair value measurements. It also
required information on purchases, sales, issuances, and settlements on a gross basis in the reconciliation of Level 3 fair value
measurements. This guidance was effective for us as of January 1, 2010, with the exception of guidance applicable to detailed
Level 3 reconciliation disclosures, which became effective for us as of January 1, 2011. The adoption of this guidance did not
have a material impact on our results of operations, financial position, or liquidity because it provides enhanced disclosure
requirements only.
The following table summarizes the changes in the fair value of financial assets and liabilities classified as Level 3 in the
fair value hierarchy as of December 31, 2011:
Ameren
Missouri
Net derivative commodity contracts
Ameren
Illinois
Other(c)
Genco
Fuel oils:
Beginning balance at January 1, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
30
$
Realized and unrealized gains (losses):
Included in earnings(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers out of Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31,2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas:
Beginning balance at January 1, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power:
Beginning balance at January 1, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in earnings(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in OCI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers into Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers out of Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium:
Beginning balance at January 1, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
$
$
$
$
$
$
$
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
$
$
$ (134)
(107)
(107)
1
(1)
81
$ (160)
$
(72)
-
19
19
4
(1)
(30)
(19)
3
(11)
(14)
(8)
(8)
-
-
8
(14)
(6)
2
$ (352)
-
-
17
17
30
(1)
(27)
(1)
1
21
1
2
(3)
(3)
(1)
1
(1)
-
-
-
7
7
-
-
205
-
-
$ (140)
$
$
$
$
13
(a)
(a)
(a)
(a)
(a)
(a)
(a)
$
17
$
12
(a)
12
1
-
(20)
(9)
1
(5)
-
(a)
(a)
-
-
-
-
-
3
(1)
-
(a)
(1)
-
-
(2)
-
-
-
(1)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
4
4
(a)
4
-
-
(6)
(2)
-
(2)
-
(a)
(a)
-
-
-
-
-
383
(12)
24
51
63
35
(21)
(225)
1
(2)
234
60
(a)
(a)
(a)
(a)
(a)
(a)
(a)
Ameren
$
51
16
19
35
5
(1)
(56)
(30)
4
(18)
$
$
$ (148)
(115)
(115)
1
(1)
89
$ (174)
$
$
$
$
$
$
$
(78)
36
(13)
24
75
86
65
(22)
(49)
-
(1)
115
73
2
(3)
(3)
(1)
1
(1)
-
(a) Not applicable.
(b) Net gains and losses on fuel oils and natural gas derivative commodity contracts are recorded in “Operating Expenses – Fuel”, while net gains
and losses on power derivative commodity contracts are recorded in “Operating Revenues – Electric.”
Includes amounts for Merchant Generation nonregistrant subsidiaries and intercompany eliminations.
(c)
133
The following table summarizes the changes in the fair value of financial assets and liabilities classified as Level 3 in the
fair value hierarchy as of December 31, 2010:
Fuel oils:
Beginning balance at January 1, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in earnings(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Natural gas:
Beginning balance at January 1, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Power:
Beginning balance at January 1, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in earnings(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in OCI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . . .
Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers into Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers out of Level 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Uranium:
Beginning balance at January 1, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Realized and unrealized gains (losses):
Included in regulatory assets/liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total realized and unrealized gains (losses) . . . . . . . . . . . . . . . . . . . . .
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ending balance at December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in unrealized gains (losses) related to assets/liabilities held at
December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net derivative commodity contracts
Ameren
Missouri
Ameren
Illinois
Genco
Other(c)
Ameren
$
32
$
(a)
$
21
$
7
$
60
-
8
8
18
(28)
30
7
(a)
(a)
(a)
(a)
(a)
(a)
(a)
$
$
(6)
$ (61)
(20)
(20)
-
12
(14)
(11)
(152)
(152)
(5)
84
$ (134)
$ (82)
(1)
$ (422)
-
-
27
27
4
2
(24)
-
(6)
2
1
-
-
(107)
(107)
19
-
158
-
-
$ (352)
$ (89)
(2)
$
(a)
3
3
1
2
1
(a)
(a)
(a)
(a)
(a)
$
$
$
$
$
$
$
$
$
$
$
$
$
3
(a)
3
11
(18)
17
4
-
(a)
-
-
-
-
-
1
2
-
(a)
2
(10)
12
(2)
-
-
3
-
(a)
(a)
(a)
(a)
(a)
(a)
$
$
$
$
$
$
$
$
$
$
$
(2)
(a)
(2)
4
(5)
4
-
-
(a)
-
-
-
-
1
$
$
$
$
$
$ 460
32
8
95
135
26
(13)
(197)
(2)
(26)
$ 383
$
81
$
(a)
(a)
(a)
(a)
(a)
(a)
$
$
1
8
9
33
(51)
51
11
(67)
$
$
$
(172)
(172)
(5)
96
$ (148)
$
$
$
$
$
$
$
(92)
38
34
8
15
57
39
1
(65)
(2)
(32)
36
(7)
(2)
3
3
1
2
1
(a) Not applicable.
(b) Net gains and losses on heating oil and natural gas derivative commodity contracts are recorded in Operating Expenses – Fuel, while net gains
and losses on power derivative commodity contracts are recorded in Operating Revenues – Electric.
Includes amounts for Merchant Generation nonregistrant subsidiaries and intercompany eliminations.
(c)
134
Transfers in or out of Level 3 represent either (1) existing assets and liabilities that were previously categorized as a
higher level but were recategorized to Level 3 because the inputs to the model became unobservable during the period, or
(2) existing assets and liabilities that were previously classified as Level 3 but were recategorized to a higher level because the
lowest significant input became observable during the period. Transfers between Level 2 and Level 3 were primarily caused by
changes in availability of financial power trades observable on electronic exchanges from the previous reporting period for the
years ended December 31, 2011 and 2010. Any reclassifications are reported as transfers out of Level 3 at the fair value
measurement reported at the beginning of the period in which the changes occur. For the years ended December 31, 2011 and
2010, there were no transfers between Level 1 and Level 2 related to derivative commodity contracts. The following table
summarizes all transfers between fair value hierarchy levels related to derivative commodity contracts for the years ended
December 31, 2011 and 2010:
Ameren - derivative commodity contracts:(a)
Transfers into Level 3 / Transfers out of Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers out of Level 3 / Transfers into Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers into Level 3 / Transfers out of Level 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers out of Level 3 / Transfers into Level 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net fair value of Level 3 transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri – derivative commodity contracts:
Transfers out of Level 3 / Transfers into Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers into Level 3 / Transfers out of Level 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfers out of Level 3 / Transfers into Level 2 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net fair value of Level 3 transfers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco – derivative commodity contracts:
Transfers out of Level 3 / Transfers into Level 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2011
2010
$
$
$
$
$
-
(30)
-
(1)
(31)
(19)
(1)
1
(19)
(9)
$
$
$
$
$
(1)
-
(1)
(32)
(34)
-
-
(6)
(6)
-
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
See Note 11 – Retirement Benefits for the fair value hierarchy tables detailing Ameren’s pension and postretirement plan
assets as of December 31, 2011, as well as a table summarizing the changes in Level 3 plan assets during 2011.
The Ameren Companies’ carrying amounts of cash and cash equivalents, accounts receivable, short-term borrowings,
and accounts payable approximate fair value because of the short-term nature of these instruments. The estimated fair value of
long-term debt and preferred stock is based on the quoted market prices for same or similar issues for companies with similar
credit profiles or on the current rates offered to the Ameren Companies for similar financial instruments.
The following table presents the carrying amounts and estimated fair values of our long-term debt and preferred stock at
December 31, 2011 and 2010:
Ameren:(a)(b)
Long-term debt and capital lease obligations (including current portion) . . . . .
Preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Long-term debt and capital lease obligations (including current portion) . . . . .
Preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Long-term debt (including current portion) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Preferred stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
Long-term debt (including current portion) . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2011
Carrying Amount
Fair Value
2010
Carrying Amount
Fair Value
$
$
$
$
6,856
142
3,950
80
1,658
62
824
$
$
$
$
7,800
92
4,541
55
1,943
37
839
$
$
$
$
7,008
142
3,954
80
1,807
62
824
$
$
$
$
7,661
102
4,281
62
2,067
40
826
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) Preferred stock along with the 20% noncontrolling interest of EEI is recorded in Noncontrolling Interests on the balance sheet.
NOTE 9 – NUCLEAR DECOMMISSIONING TRUST FUND
INVESTMENTS
Ameren Missouri has investments in debt and equity
securities that are held in a trust fund for the purpose of
funding the decommissioning of its Callaway energy center.
See Note 10 – Callaway Energy Center for additional
information. We have classified these investments as
available for sale, and we have recorded all such
investments at their fair market value at December 31,
2011, and 2010.
135
Investments in the nuclear decommissioning trust
fund have a target allocation of 60% to 70% in equity
securities, with the balance invested in debt securities.
The following table presents proceeds from the sale of
investments in Ameren Missouri’s nuclear
decommissioning trust fund and the gross realized gains
and losses resulting from those sales for the years ended
December 31, 2011, 2010, and 2009:
Proceeds from sales . . . . . . . . . .
Gross realized gains . . . . . . . . . . .
Gross realized losses . . . . . . . . . .
2011
$ 199
5
4
2010
$ 256
5
4
2009
$ 380
5
10
Net realized and unrealized gains and losses are
deferred and recorded as regulatory assets or regulatory
liabilities on Ameren’s and Ameren Missouri’s balance
sheets. This reporting is consistent with the method used to
account for the decommissioning costs recovered in rates.
Gains or losses associated with assets in the trust fund
could result in lower or higher funding requirements for
decommissioning costs, which are expected to be reflected
in electric rates paid by Ameren Missouri’s customers. See
Note 2 – Rate and Regulatory Matters.
The following table presents the costs and fair values of investments in debt and equity securities in Ameren Missouri’s
nuclear decommissioning trust fund at December 31, 2011 and 2010:
Security Type
Cost
Gross Unrealized Gain
Gross Unrealized Loss
Fair Value
2011:
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(b)
$
114
145
3
(1)
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
261
2010:
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other(b)
$
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
104
141
1
1
247
$
$
$
$
7
101
-
-
108
4
95
-
-
99
$
(a)
12
-
-
$
12
$
$
1
8
-
-
9
$
121
234
3
(1)
$ 357
$
$
107
228
1
1
337
(a) Amount less than $1 million.
(b) Represents payables relating to pending security purchases, net of receivables related to pending securities sales and interest receivables.
The following table presents the costs and fair values of investments in debt securities in Ameren Missouri’s nuclear
decommissioning trust fund according to their contractual maturities at December 31, 2011:
Less than 5 years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5 years to 10 years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Due after 10 years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
57
34
23
59
36
26
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
114
$
121
Cost
Fair Value
We have unrealized losses relating to certain available-for-sale investments included in our decommissioning trust fund,
recorded as regulatory assets as discussed above. Decommissioning will not occur until the operating license for our nuclear
facility expires. Ameren Missouri submitted a license extension application to the NRC to extend the Callaway energy center’s
operating license to 2044. The following table presents the fair value and the gross unrealized losses of the available-for-sale
securities held in Ameren Missouri’s nuclear decommissioning trust fund. They are aggregated by investment category and the
length of time that individual securities have been in a continuous unrealized loss position at December 31, 2011:
Less than 12 Months
Gross
Unrealized
Losses
Fair Value
12 Months or Greater
Gross
Unrealized
Losses
Fair Value
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
7
18
25
$
$
(a)
4
4
$
$
(a)
8
8
$
$
(a)
8
8
(a) Amount less than $1 million.
Total
Gross
Unrealized
Losses
$
$
(a)
12
12
Fair Value
$
$
7
26
33
136
NOTE 10 – CALLAWAY ENERGY CENTER
Under the NWPA, the DOE is responsible for disposing
of spent nuclear fuel from the Callaway energy center and
other commercial nuclear power plants. Under the NWPA,
Ameren and other utilities who own and operate those
plants are responsible for paying the disposal costs. The
NWPA established the fee that these utilities pay the federal
government for disposing of the spent nuclear fuel at one
mill, or one-tenth of one cent, for each kilowatt hour
generated by those plants and sold. The NWPA also
requires the DOE to review the nuclear waste fee against the
cost of the nuclear waste disposal program and to propose
to the United States Congress any fee adjustment necessary
to offset the costs of the program. As required by the
NWPA, Ameren and other utilities have entered into
standard contracts with the federal government. The
government, represented by the DOE, implements these
provisions of the NWPA. Consistent with the NWPA and its
contract, Ameren Missouri collects one mill from its electric
customers for each kilowatt hour of electricity that it
generates and sells from its Callaway energy center.
Although both the NWPA and the standard contract
stated that the federal government would begin to dispose of
spent nuclear fuel by 1998, the federal government has
acknowledged since at least 1994 that it would not meet that
deadline. The federal government is not currently predicting
when it will begin to meet its disposal obligation. Ameren
Missouri has sufficient installed capacity at its Callaway
energy center to store the spent nuclear fuel generated at
Callaway through 2020 and has the capability for additional
storage capacity for spent nuclear fuel generated through the
end of the energy center’s current licensed life.
Until January 2009, the DOE program provided for
spent nuclear fuel disposal to take place at a geologic
repository to be constructed at Yucca Mountain, Nevada. In
January 2009, the Obama administration announced that a
repository at Yucca Mountain was unworkable and took
steps to terminate the Yucca Mountain program, while
acknowledging the federal government’s continuing
obligation to dispose of utilities’ spent nuclear fuel. In
January 2012, an advisory commission established by the
DOE issued its report of recommendations for the storage
and disposal of spent nuclear fuel. The recommendations
covered topics such as the approach to siting future nuclear
waste management facilities, the transport and storage of
spent fuel and high-level waste, options for waste disposal,
institutional arrangements for managing spent nuclear fuel
and high-level wastes, and changes needed in the handling
of nuclear waste fees and of the Nuclear Waste Fund. Most
of these recommendations require action by the DOE and
the United States Congress.
In view of the federal government’s efforts to terminate
the Yucca Mountain program, the Nuclear Energy Institute,
a number of individual utilities, and the National Association
of Regulatory Utility Commissioners sued the DOE in the
United States Court of Appeals for the District of Columbia
Circuit seeking the suspension of the one mill nuclear waste
fee. They allege that the DOE’s failure to undertake an
appropriate fee adequacy review reflects the current
unsettled state of the nuclear waste program. That case is
pending. The DOE delay in carrying out its obligation to
dispose of spent nuclear fuel from the Callaway energy
center is not expected to adversely affect the continued
operation of the energy center.
As a result of DOE’s failure to build a repository for
nuclear waste or otherwise fulfill its contract obligations,
Ameren Missouri and other nuclear power plant owners
have also sued DOE to recover costs incurred for ongoing
storage of their spent fuel. Ameren Missouri filed a breach
of contract suit in 2004 to recover $13 million in costs that
it incurred through 2009. This amount included the cost of
reracking the Callaway energy center’s spent fuel pool, as
well as certain NRC fees, and Missouri ad valorem taxes
that Ameren Missouri would not have incurred had DOE
performed its contractual obligations. In June 2011, the
parties reached a settlement that included a payment to
Ameren Missouri of $11 million for spent fuel storage and
related costs through 2010 and, thereafter, annual payment
of such costs after they are incurred through 2013 or any
other mutually agreed extension. As a result of this
settlement agreement, Ameren Missouri recorded a pretax
reduction of $2 million and $2 million to its “Operating
Expenses – Depreciation and amortization” and “Operating
Expenses – Other operations and maintenance” expense
line items, respectively, on its statement of income for the
year ended December 31, 2011. Ameren Missouri reduced
its property and plant assets by $7 million. Under the
settlement, Ameren Missouri’s 2004 breach of contract suit
was dismissed in July 2011.
In December 2011, Ameren Missouri submitted a
license extension application with the NRC to extend its
Callaway energy center’s operating license from 2024 to
2044. There is no date by which the NRC must act in this
relicensing request. If the Callaway energy center’s license
is extended, additional spent fuel storage will be required.
Ameren Missouri plans to install a dry spent fuel storage
facility at its Callaway energy center and intends to begin
transferring spent fuel assemblies to this facility by 2020.
Electric utility rates charged to customers provide for
the recovery of the Callaway energy center’s
decommissioning costs, which include decontamination,
dismantling, and site restoration costs, over an assumed
40-year life of the nuclear center, ending with the expiration
of the energy center’s current operating license in 2024. It
is assumed that the Callaway energy center site will be
decommissioned through the immediate dismantlement
method and removed from service. Ameren and Ameren
Missouri have recorded an ARO for the Callaway energy
center decommissioning costs at fair value, which
represents the present value of estimated future cash
outflows. Decommissioning costs are included in the costs
of service used to establish electric rates for Ameren
Missouri’s customers. These costs amounted to $7 million
in each of the years 2011, 2010, and 2009. Every three
years, the MoPSC requires Ameren Missouri to file an
137
updated cost study for decommissioning its Callaway
energy center. Electric rates may be adjusted at such times
to reflect changed estimates. This cost study was filed with
the MoPSC in September 2011. After considering the
results of this updated cost study and associated financial
analysis, Ameren Missouri recommended to the MoPSC
that the current rate of deposits to the trust fund continues
to be appropriate and does not need to be changed.
Amounts collected from customers are deposited in an
external trust fund to provide for the Callaway energy
center’s decommissioning. If the assumed return on trust
assets is not earned, we believe that it is probable that any
such earnings deficiency will be recovered in rates. The fair
value of the nuclear decommissioning trust fund for
Ameren Missouri’s Callaway energy center is reported as
“Nuclear decommissioning trust fund” in Ameren’s
consolidated balance sheet and Ameren Missouri’s balance
sheet. This amount is legally restricted and may be used
only to fund the costs of nuclear decommissioning.
Changes in the fair value of the trust fund are recorded as
an increase or decrease to the nuclear decommissioning
trust fund, with an offsetting adjustment to the related
regulatory asset or regulatory liability.
NOTE 11 – RETIREMENT BENEFITS
The primary objective of the Ameren pension plans and
postretirement benefit plans is to provide eligible employees
with pension and postretirement health care and life
insurance benefits. Ameren offers defined benefit pension
and postretirement benefit plans covering substantially all
of its employees. Ameren uses a measurement date of
December 31 for its pension and postretirement benefit
plans. Ameren Missouri, Ameren Illinois and Genco,
excluding EEI, each participate in Ameren’s single-employer
pension and other postretirement plans. Ameren’s qualified
pension plan is the Ameren Retirement Plan. Ameren also
has an unfunded non-qualified pension plan, the Ameren
Supplemental Retirement Plan, which is available for certain
management employees and retirees to provide a
supplemental benefit when their qualified pension plan
benefits are reduced to comply with Internal Revenue Code
limitations. Ameren’s other postretirement plans are the
Ameren Retiree Medical Plan and the Ameren Group Life
Insurance Plan. Separately, EEI employees and retirees
participate in EEI’s single-employer pension and other
postretirement plans. EEI’s pension plan is the Revised
Retirement Plan for Employees of Electric Energy, Inc. EEI’s
other postretirement plans are the Group Insurance Plan for
Management Employees of Electric Energy, Inc. and the
Group Insurance Plan for Bargaining Unit Employees of
Electric Energy, Inc. Nonaffiliated Ameren companies do not
participate in the Ameren Retirement Plan, the Ameren
Supplemental Retirement Plan, the Ameren Retiree Medical
Plan, and the Ameren Group Life Insurance Plan. Ameren
and Genco each consolidate EEI, and therefore, EEI’s plans
are reflected in Ameren’s and Genco’s pension and
postretirement balances and disclosures.
The following table presents the benefit liability
recorded on the balance sheets of each of the Ameren
Companies as of December 31, 2011:
Ameren(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,350
494
496
141
(a)
Includes amounts for Ameren registrant and nonregistrant
subsidiaries.
138
Ameren recognizes the underfunded status of its pension and postretirement plans as a liability on its balance sheet, with
offsetting entries to accumulated OCI and regulatory assets, in accordance with authoritative accounting guidance. The
following table presents the funded status of our pension and postretirement benefit plans as of December 31, 2011, and
2010. It also provides the amounts included in regulatory assets and accumulated OCI at December 31, 2011, and 2010, that
have not been recognized in net periodic benefit costs.
2011
2010
Pension Benefits(a)
Postretirement
Benefits(a)
Pension Benefits(a)
Postretirement
Benefits(a)
Accumulated benefit obligation at end of year
. . . . . . . . . . . . . . .
Change in benefit obligation:
Net benefit obligation at beginning of year . . . . . . . . . . . . . . . .
Service cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Plan amendments(c)(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Participant contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial (gain) loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Early retiree reinsurance program receipt . . . . . . . . . . . . . . . . .
Federal subsidy on benefits paid . . . . . . . . . . . . . . . . . . . . . . . .
Net benefit obligation at end of year . . . . . . . . . . . . . . . . . . . . . . .
Change in plan assets:
Fair value of plan assets at beginning of year
. . . . . . . . . . . . .
Actual return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . .
Employer contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal subsidy on benefits paid . . . . . . . . . . . . . . . . . . . . . . . .
Early retiree reinsurance program receipt . . . . . . . . . . . . . . . . .
Participant contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Benefits paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair value of plan assets at end of year . . . . . . . . . . . . . . . . . . . . .
Funded status – deficiency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accrued benefit cost at December 31 . . . . . . . . . . . . . . . . . . . . . .
Amounts recognized in the balance sheet consist of:
Current liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Noncurrent liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amounts recognized in regulatory assets consist of:
Net actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost (credit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amounts (pretax) recognized in accumulated OCI consist of:
Net actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost (credit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
$
$
3,645
3,451
75
180
(16)
-
348
(173)
(b)
(b)
3,865
2,722
224
103
(b)
(b)
-
(173)
2,876
989
989
3
986
989
734
(7)
-
79
(15)
$
$
$
$
$
$
(b)
1,120
22
58
-
18
96
(66)
3
6
1,257
797
9
129
6
3
18
(66)
896
361
361
3
358
361
177
(28)
2
43
(7)
$
$
$
$
$
$
3,246
3,255
68
185
(40)
-
165
(182)
(b)
(b)
3,451
2,495
328
81
(b)
(b)
-
(182)
2,722
729
729
4
725
729
507
(11)
-
24
4
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
791
$
187
$
524
$
$
$
$
$
$
$
(b)
1,143
20
62
-
17
(53)
(74)
-
5
1,120
732
81
36
5
-
17
(74)
797
323
323
3
320
323
86
(32)
5
13
(10)
62
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
(a)
(b) Not applicable.
(c)
In 2011, Ameren’s pension plan was amended to adjust the calculation of the future benefit obligation of approximately 430 labor union-
represented employees from a traditional, final pay formula to a cash balance formula.
In 2010, Ameren’s pension plan was amended to adjust the calculation of the future benefit obligation of approximately 700 management
employees from a traditional, final pay formula to a cash balance formula.
(d)
The following table presents the assumptions used to determine our benefit obligations at December 31, 2011, and 2010:
Discount rate at measurement date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase in future compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Medical cost trend rate (initial) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Medical cost trend rate (ultimate) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Years to ultimate rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension Benefits
2010
2011
4.50%
3.50
-
-
-
5.25%
3.50
-
-
-
Postretirement Benefits
2011
4.50%
3.50
5.50
5.00
1 year
2010
5.25%
3.50
6.00
5.00
2 years
139
Ameren determines discount rate assumptions by
using an interest rate yield curve pursuant to authoritative
accounting guidance on the determination of discount rates
used for defined benefit plan obligations. The yield curve is
based on the yields of more than 500 high-quality corporate
bonds with maturities between zero and 30 years. A
theoretical spot-rate curve constructed from this yield curve
is then used as a guide to develop a discount rate matching
the plans’ payout structure.
Funding
Pension benefits are based on the employees’ years of
service and compensation. Ameren’s pension plan is funded
in compliance with income tax regulations and federal
funding or regulatory requirements. As a result, Ameren
expects to fund its pension plan at a level equal to the
greater of the pension expense or the legally required
minimum contribution. Considering Ameren’s assumptions
at December 31, 2011, its investment performance in 2011,
and its pension funding policy, Ameren expects to make
annual contributions of $90 million to $150 million in each
of the next five years, with aggregate estimated
contributions of $580 million. We expect Ameren
Missouri’s, Ameren Illinois’ and Genco’s portion of the
future funding requirements to be 51%, 33%, and 12%,
respectively. These amounts are estimates. The estimates
may change based on actual investment performance,
changes in interest rates, changes in our assumptions, any
pertinent changes in government regulations, and any
voluntary contributions. Our funding policy for
postretirement benefits is primarily to fund the Voluntary
Employee Beneficiary Association (VEBA) trusts to match
the annual postretirement expense.
The following table presents the cash contributions
made to our defined benefit retirement plan and to our
postretirement plans during 2011, 2010, and 2009:
Investment Strategy and Policies
Ameren manages plan assets in accordance with the
“prudent investor” guidelines contained in ERISA. The
investment committee, to the extent authority is delegated
to it by the finance committee of Ameren’s board of
directors, implements investment strategy and asset
allocation guidelines for the plan assets. The investment
committee includes members of senior management. The
investment committee’s goals are twofold: first, to ensure
that sufficient funds are available to provide the benefits at
the time they are payable, and second, to maximize total
return on plan assets and minimize expense volatility
consistent with its tolerance for risk. Ameren delegates
investment management to specialists in each asset class.
As appropriate, Ameren provides the investment manager
with guidelines that specify allowable and prohibited
investment types. The investment committee regularly
monitors manager performance and compliance with
investment guidelines.
The expected return on plan assets assumption is
based on historical and projected rates of return for current
and planned asset classes in the investment portfolio.
Projected rates of return for each asset class were
estimated after an analysis of historical experience, future
expectations, and the volatility of the various asset classes.
After considering the target asset allocation for each asset
class, we adjusted the overall expected rate of return for the
portfolio for historical and expected experience of active
portfolio management results compared with benchmark
returns and for the effect of expenses paid from plan assets.
Ameren will utilize an expected return on plan assets for its
pension plan assets and postretirement plan assets of
7.75% and 7.50%, respectively, in 2012. No plan assets are
expected to be returned to Ameren during 2012.
Pension Benefits
2010
2011
2009
Postretirement Benefits
2009
2010
2011
Ameren(a) . . . . $
AMO . . . . . . . .
AIC . . . . . . . . .
Genco . . . . . . .
103 $
43
28
12
81 $
36
23
4
99 $
42
25
10
129 $
9
118
-
36 $
11
20
-
49
13
28
-
(a)
Includes amounts for Ameren registrant and nonregistrant
subsidiaries.
140
Ameren’s investment committee strives to assemble a portfolio of diversified assets that does not create a significant
concentration of risks. The investment committee develops asset allocation guidelines between asset classes, and it creates
diversification through investments in assets that differ by type (equity, debt, real estate, private equity), duration, market
capitalization, country, style (growth or value) and industry, among other factors. The diversification of assets is displayed in
the target allocation table below. The investment committee also routinely rebalances the plan assets to adhere to the
diversification goals. The investment committee’s strategy reduces the concentration of investment risk; however, Ameren is
still subject to overall market risk. The following table presents our target allocations for 2012 and our pension and
postretirement plans’ asset categories as of December 31, 2011, and 2010.
Asset
Category
Target Allocation
2012
2011
Percentage of Plan Assets at December 31,
Pension Plan:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. small and mid-capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International and emerging markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Private equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Postretirement Plans:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. small and mid-capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0 - 5 %
2%
29 - 39
2 - 12
9 - 19
50 - 60
35 - 45
0 - 9
0 - 4
0 - 10 %
33 - 43
3 - 13
10 - 20
55 - 65
30 - 40
33
7
11
51
42
4
1
100%
4%
38
8
13
59
37
2010
1%
31
11
15
57
37
4
1
100%
4%
39
10
14
63
33
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
100%
100%
In general, the U.S. large capitalization equity investments are passively managed or indexed, whereas the international,
emerging markets, U.S. small capitalization, and U.S. mid-capitalization equity investments are actively managed by
investment managers. Debt securities include a broad range of fixed income vehicles. Debt security investments in high-yield
securities, emerging market securities, and non-U.S. dollar-denominated securities are owned by the plans, but in limited
quantities to reduce risk. Most of the debt security investments are under active management by investment managers. Real
estate investments include private real estate vehicles; however, Ameren does not, by policy, hold direct investments in real
estate property. Ameren’s investment in private equity funds consists of 10 different limited partnerships, with invested capital
ranging from $0.1 million to $7 million each, which invest primarily in a diversified number of small U.S.-based companies. No
further commitments may be made to private equity investments without approval by the finance committee of the board of
directors. Additionally, Ameren’s investment committee allows investment managers to use derivatives, such as index futures,
exchange traded funds, foreign exchange futures, and options, in certain situations, to increase or to reduce market exposure
in an efficient and timely manner.
Fair Value Measurements of Plan Assets
Investments in the pension and postretirement benefit plans were stated at fair value as of December 31, 2011. The fair
value of an asset is the amount that would be received upon sale in an orderly transaction between market participants at the
measurement date. Cash and cash equivalents have initial maturities of three months or less and are recorded at cost plus
accrued interest. The carrying amounts of cash and cash equivalents approximate fair value because of the short-term nature
of these instruments. Investments traded in active markets on national or international securities exchanges are valued at
closing prices on the last business day on or before the measurement date. Securities traded in over-the-counter markets are
valued based on quoted market prices, broker or dealer quotations, or alternative pricing sources with reasonable levels of
price transparency. Derivative contracts are valued at fair value, as determined by the investment managers (or independent
third parties on behalf of the investment managers), who use proprietary models and take into consideration exchange
quotations on underlying instruments, dealer quotations, and other market information. The fair value of real estate is based
on annual appraisal reports prepared by an independent real estate appraiser.
141
The following table sets forth, by level within the fair value hierarchy discussed in Note 8 – Fair Value Measurements, the
pension plan assets measured at fair value as of December 31, 2011:
Quoted Prices in
Active Markets for
Identified Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. small and mid-capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . .
International and emerging markets . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Private equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
$
31
$
72
202
115
-
-
-
-
-
-
1
(1)
922
11
213
720
176
230
121
-
-
-
-
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
389
$
2,424
$
Less: Medical benefit assets at December 31(a)
. . . . . . . . . . . . . . . . . .
Plus: Net receivables at December 31(b)
. . . . . . . . . . . . . . . . . . . . . . . .
Fair value of pension plans assets at year end . . . . . . . . . . . . . . . . . . .
-
-
-
-
-
-
-
-
108
23
-
-
131
Total
$
31
994
213
328
720
176
230
121
108
23
1
(1)
$
2,944
(91)
23
$
2,876
(a) Medical benefit (health and welfare) component for accounts maintained in accordance with Section 401(h) of the Internal Revenue Code
(401(h) accounts) to fund a portion of the postretirement obligation.
(b) Receivables related to pending security sales, offset by payables related to pending security purchases.
The following table sets forth, by level within the fair value hierarchy discussed in Note 8 – Fair Value Measurements, the
pension plan assets measured at fair value as of December 31, 2010:
Quoted Prices in
Active Markets for
Identified Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. small and mid-capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . .
International and emerging markets . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Real estate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Private equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Derivative liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
$
20
$
70
299
129
-
-
-
-
-
-
1
(1)
812
10
284
646
129
154
100
-
-
-
-
-
-
-
-
-
-
-
-
98
28
-
-
Total
$
20
882
309
413
646
129
154
100
98
28
1
(1)
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
498
$
2,155
$
126
$
2,779
Less: Medical benefit assets at December 31(a)
. . . . . . . . . . . . . . . . . .
Plus: Net receivables at December 31(b)
. . . . . . . . . . . . . . . . . . . . . . . .
Fair value of pension plans assets at year end . . . . . . . . . . . . . . . . . . .
(85)
28
$
2,722
(a) Medical benefit (health and welfare) component for accounts maintained in accordance with Section 401(h) of the Internal Revenue Code
(401(h) accounts) to fund a portion of the postretirement obligation.
(b) Receivables related to pending security sales, offset by payables related to pending security purchases.
142
The following table summarizes the changes in the fair value of the pension plan assets classified as Level 3 in the fair
value hierarchy for each of the years ended December 31, 2011, and 2010:
Beginning
Balance at
January 1,
Actual Return on
Plan Assets Related
to Assets Still Held
at the Reporting Date
Actual Return on
Plan Assets Related
to Assets Sold
During the Period
Purchases,
Sales, and
Settlements, net
Net
Transfers
into (out of)
of Level 3
Ending Balance at
December 31,
2011:
Real estate . . . . . . . . . . . . . . . . .
Private equity . . . . . . . . . . . . . . .
2010:
Other debt securities . . . . . . . . . .
Real estate . . . . . . . . . . . . . . . . .
Private equity . . . . . . . . . . . . . . .
$
$
98
28
1
90
33
$ 10
(10)
$
-
7
(5)
$
-
11
$
-
-
7
$
-
(6)
$ (1)
1
(7)
$
$
-
-
-
-
-
$
$
108
23
-
98
28
The following table sets forth, by level within the fair value hierarchy discussed in Note 8 – Fair Value Measurements, the
postretirement benefit plans assets measured at fair value as of December 31, 2011:
Quoted Prices in
Active Markets for
Identified Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. small and mid-capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asset-backed securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
1
$
235
57
44
-
-
-
-
-
$
66
78
-
56
61
86
82
23
49
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
337
$
501
$
-
-
-
-
-
-
-
-
-
-
Plus: Medical benefit assets at December 31(a)
. . . . . . . . . . . . . . . . . . . .
Less: Net payables at December 31(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair value of postretirement benefit plans assets at year end . . . . . . . . . .
Total
$
67
313
57
100
61
86
82
23
49
$ 838
91
(33)
$
896
(a) Medical benefit (health and welfare) component for 401(h) accounts to fund a portion of the postretirement obligation. These 401(h) assets are
included in the pension plan assets shown above.
(b) Payables related to pending security purchases, offset by Medicare, interest receivables, and receivables related to pending security sales.
The following table sets forth, by level within the fair value hierarchy discussed in Note 8 – Fair Value Measurements, the
postretirement benefit plans assets measured at fair value as of December 31, 2010:
Quoted Prices in
Active Markets for
Identified Assets
(Level 1)
Significant Other
Observable Inputs
(Level 2)
Significant Other
Unobservable
Inputs
(Level 3)
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity securities:
U.S. large capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. small and mid-capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
International . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Debt securities:
Corporate bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Municipal bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
U.S. treasury and agency securities . . . . . . . . . . . . . . . . . . . . . . . . . . .
Asset-backed securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
$
215
66
43
-
-
-
-
-
$
35
72
-
51
59
58
59
31
29
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
324
$
394
$
-
-
-
-
-
-
-
-
-
-
Plus: Medical benefit assets at December 31(a)
. . . . . . . . . . . . . . . . . . . .
Less: Net payables at December 31(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . .
Fair value of postretirement benefit plans assets at year end . . . . . . . . . .
Total
$
35
287
66
94
59
58
59
31
29
$ 718
85
(6)
$
797
(a) Medical benefit (health and welfare) component for 401(h) accounts to fund a portion of the postretirement obligation. These 401(h) assets are
included in the pension plan assets shown above.
(b) Payables related to pending security purchases, offset by Medicare, interest receivables, and receivables related to pending security sales.
143
Net Periodic Benefit Cost
The following table presents the components of the net periodic benefit cost of our pension and postretirement benefit
plans during 2011, 2010, and 2009:
Pension Benefits
Postretirement Benefits
Ameren(a)
Ameren(a)
2011:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Service cost
Interest cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of:
Transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Service cost
Interest cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of:
Transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Service cost
Interest cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of:
Transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net periodic benefit cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
$
75
180
(216)
-
(1)
42
80
68
185
(212)
-
6
18
65
68
186
(206)
-
9
24
81
$
$
$
$
$
$
22
58
(54)
2
(8)
5
$
25
$
20
62
(56)
2
(8)
1
$
21
$
19
66
(54)
2
(8)
9
$
34
The current year expected return on plan assets is determined primarily by adjusting the prior-year market-
related asset value for current year contributions, disbursements, and expected return, plus 25% of the actual return
in excess of (or less than) expected return for the four prior years.
The estimated amounts that will be amortized from regulatory assets and accumulated OCI into net periodic
benefit cost in 2012 are as follows:
Pension Benefits
Postretirement Benefits
Ameren(a)
Ameren(a)
Regulatory assets:
Transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost (credit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated OCI:
Transition obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Prior service cost (credit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net actuarial loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
-
(1)
87
-
(1)
6
$
2
(4)
23
-
(1)
3
Total
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
91
$
23
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
Prior service cost is amortized on a straight-line basis over the average future service of active participants benefiting
under the plan amendment. The net actuarial loss subject to amortization is amortized on a straight-line basis over 10 years.
144
Ameren Missouri, Ameren Illinois and Genco are responsible for their share of the pension and postretirement benefit
costs. The following table presents the pension costs and the postretirement benefit costs incurred for the years ended
December 31, 2011, 2010, and 2009:
Pension Costs
Postretirement Costs
2011
2010
2009
2011
2010
2009
Ameren(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
80
51
16
8
$
65
42
10
9
$
81
50
14
11
$
25
11
11
3
$
21
11
7
2
$
34
15
16
3
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
The expected pension and postretirement benefit payments from qualified trust and company funds and the federal
subsidy for postretirement benefits related to prescription drug benefits, which reflect expected future service, as of
December 31, 2011, are as follows:
2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2016 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2017 - 2021 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Pension Benefits
Postretirement Benefits
Paid from
Qualified
Trust
$
223
225
230
231
232
1,167
Paid from
Company
Funds
Paid from
Qualified
Trust
Paid from
Company
Funds
Federal
Subsidy
$
3
3
3
3
3
12
$
68
71
74
77
80
443
$
3
3
3
3
3
14
$
5
5
5
6
6
32
The following table presents the assumptions used to determine net periodic benefit cost for our pension and
postretirement benefit plans for the years ended December 31, 2011, 2010, and 2009:
Pension Benefits
Postretirement Benefits
2011
2010
2009
2011
2010
2009
Discount rate at measurement date . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Expected return on plan assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increase in future compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Medical cost trend rate (initial)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Medical cost trend rate (ultimate) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Years to ultimate rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
5.25%
8.00
3.50
-
-
-
5.75%
8.00
3.50
-
-
-
5.75%
8.00
4.00
-
-
-
5.25%
7.75
3.50
6.00
5.00
2 years
5.75%
8.00
3.50
6.50
5.00
3 years
5.75%
8.00
4.00
7.00
5.00
4 years
The table below reflects the sensitivity of Ameren’s plans to potential changes in key assumptions:
Pension Benefits
Postretirement Benefits
Service Cost
and Interest
Cost
Projected
Benefit
Obligation
Service Cost
and Interest
Cost
Postretirement
Benefit
Obligation
0.25% decrease in discount rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
0.25% increase in salary scale . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1.00% increase in annual medical trend . . . . . . . . . . . . . . . . . . . . . . . . .
1.00% decrease in annual medical trend . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
(2)
2
-
-
$
110
14
-
-
$
-
-
3
(3)
38
-
42
(41)
Other
Ameren sponsors a 401(k) plan for eligible employees. The Ameren plan covered all eligible employees of the Ameren
Companies at December 31, 2011. The plans allowed employees to contribute a portion of their compensation in accordance
with specific guidelines. Ameren matched a percentage of the employee contributions up to certain limits. The following table
presents the portion of the 401(k) matching contribution to the Ameren plan attributable to each of the Ameren Companies for
the years ended December 31, 2011, 2010, and 2009:
Ameren(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
28
16
8
2
$
27
16
8
1
24
14
7
2
2011
2010
2009
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries.
145
NOTE 12 – STOCK-BASED COMPENSATION
Ameren’s long-term incentive plan for eligible employees, called the Long-term Incentive Plan of 1998 (1998 Plan), was
replaced prospectively by the 2006 Omnibus Incentive Compensation Plan (2006 Plan) effective May 2, 2006. The 2006 Plan
provides for a maximum of 4 million common shares to be available for grant to eligible employees and directors. No new
awards may be granted under the 1998 Plan. Previously granted awards have vested in accordance with their original terms
and conditions. The 2006 Plan awards may be stock options, stock appreciation rights, restricted stock, restricted stock units,
performance shares, performance share units, cash-based awards, and other stock-based awards.
A summary of nonvested shares at December 31, 2011, and changes during the year ended December 31, 2011, under
the 1998 Plan and the 2006 Plan are presented below:
Performance Share Units(a)
Restricted Shares(b)
Nonvested at January 1, 2011 . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Granted(c)
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Unearned or forfeited(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Earned and vested(e)
Share
Units
1,142,768
731,962
-
(565,538)
(152,361)
Weighted-average
Fair Value per Unit
$
23.96
31.41
-
16.28
29.47
Nonvested at December 31, 2011 . . . . . . . . . . . . . . . . . . . . .
1,156,831
$
31.70
Shares
83,154
-
1,005
(560)
(83,599)
-
Weighted-average
Fair Value per Share
$ 49.87
-
30.04
50.45
49.89
$
-
(a) Granted under the 2006 Plan.
(b) Granted under the 1998 Plan.
(c)
(d)
(e)
Includes performance share units (share units) granted to certain executive and nonexecutive officers and other eligible employees in January
2011 under the 2006 Plan.
Includes share units granted in 2009 that were not earned based on performance provisions of the award grants.
Includes share units granted in 2009 that vested as of December 31, 2011, that were earned pursuant to the provisions of the award grants.
Also includes share units that vested due to attainment of retirement eligibility by certain employees. Actual shares issued for retirement-
eligible employees will vary depending on actual performance over the three-year measurement period.
Ameren recorded compensation expense of $14 million,
$13 million, and $13 million for the years ended
December 31, 2011, 2010, and 2009, respectively, and a
related tax benefit of $5 million for each of the years ended
December 31, 2011, 2010, and 2009, respectively. Ameren
settled performance share units and restricted shares of
$4 million, $2 million, and less than $1 million for the years
ended December 31, 2011, 2010, and 2009. There were no
significant compensation costs capitalized during the years
ended December 31, 2011, 2010, and 2009. As of
December 31, 2011, total compensation cost of $17 million
related to nonvested awards not yet recognized is expected to
be recognized over a weighted-average period of 20 months.
Performance Share Units
Performance share unit awards have been granted
under the 2006 Plan. A share unit vests and entitles an
employee to receive shares of Ameren common stock (plus
accumulated dividends) if, at the end of the three-year
performance period, certain specified performance or
market conditions have been met and the individual remains
employed by Ameren. The exact number of shares issued
pursuant to a share unit vary from 0% to 200% of the target
award, depending on actual company performance relative
to the performance goals. For performance share units
granted prior to 2009, vested performance shares units
must be held for a two-year period before being paid to the
employee in shares of Ameren common stock. During this
two-year hold period, the employee is paid dividend
equivalents on a current basis.
The fair value of each share unit awarded in January
2011 under the 2006 Plan was determined to be $31.41.
That amount was based on Ameren’s closing common
share price of $28.19 at December 31, 2010, and lattice
simulations. Lattice simulations are used to estimate
expected share payout based on Ameren’s total shareholder
return for a three-year performance period relative to the
designated peer group beginning January 1, 2011. The
simulations can produce a greater fair value for the share
unit than the closing common share price because they
include the weighted payout scenarios in which an increase
in the share price has occurred. The significant
assumptions used to calculate fair value also included a
three-year risk-free rate of 1.08%, volatility of 22% to 36%
for the peer group, and Ameren’s attainment of three-year
average earnings per share threshold during the
performance period.
The fair value of each share unit awarded in January
2010 under the 2006 Plan was determined to be $32.01.
That amount was based on Ameren’s closing common
share price of $27.95 at December 31, 2009, and lattice
simulations. Lattice simulations are used to estimate
expected share payout based on Ameren’s total stockholder
return for a three-year performance period relative to the
designated peer group beginning January 1, 2010. The
146
significant assumptions used to calculate fair value also
included a three-year risk-free rate of 1.70%, volatility of
23% to 39% for the peer group, and Ameren’s attainment
of three-year average earnings per share threshold during
each year of the performance period.
Restricted Stock
Restricted stock awards of Ameren common stock
were granted under the 1998 Plan from 2001 to 2005.
Restricted shares had the potential to vest over a seven-
year period from the date of grant if Ameren achieved
certain performance levels. An accelerated vesting provision
included in this plan reduced the vesting period from seven
years to three years if the earnings growth rate exceeded a
prescribed level.
NOTE 13 – INCOME TAXES
The following table presents the principal reasons why the effective income tax rate differed from the statutory federal
income tax rate for the years ended December 31, 2011, 2010, and 2009:
2011:
Statutory federal income tax rate: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increases (decreases) from:
Production activities deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of investment tax credit . . . . . . . . . . . . . . . . . . . . . . . . . .
State tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other permanent items(a)
Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
Statutory federal income tax rate: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increases (decreases) from:
Non-deductible impairment of goodwill . . . . . . . . . . . . . . . . . . . . . . . .
Production activities deduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of investment tax credit . . . . . . . . . . . . . . . . . . . . . . . . . .
State tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reserve for uncertain tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Change in federal tax law(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other permanent items(c)
Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009:
Statutory federal income tax rate: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Increases (decreases) from:
Depreciation differences . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Amortization of investment tax credit . . . . . . . . . . . . . . . . . . . . . . . . . .
State tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Reserve for uncertain tax positions . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other permanent items(d)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Tax credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
Ameren Missouri
Ameren Illinois
Genco
35%
35%
35%
35%
-
(1)
(1)
4
-
-
37%
35%
32
-
(4)
(2)
8
(1)
(3)
3
-
68%
35%
(1)
(1)
5
(1)
(1)
(1)
-
(2)
(1)
3
-
1
36%
35%
-
-
(3)
(1)
3
-
-
1
-
35%
35%
(3)
(1)
3
-
-
(1)
-
-
(1)
5
-
-
39%
35%
-
-
-
(1)
5
-
-
-
-
39%
35%
(1)
(1)
5
-
(1)
-
3
-
(1)
6
(1)
-
42%
35%
(144)
7
-
4
(14)
(6)
13
(19)
(1)
(125)%
35%
-
-
4
-
(1)
-
Effective income tax rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
35%
33%
37%
38%
(a) Permanent items are treated differently for book and tax purposes and primarily include nondeductible expenses related to lobbying and stock
issuance expenses for Ameren Missouri.
(b) Relates to change in taxation of prescription drug benefits to retiree participants from the enactment in 2010 of the Patient Protection and
Affordable Care Act and the Health Care and Education Reconciliation Bill of 2010.
(c) Permanent items are treated differently for book and tax purposes and primarily include nondeductible expenses for Genco.
(d) Permanent items are treated differently for book and tax purposes and primarily include Internal Revenue Code Section 199 production activity
deductions for Ameren and Genco, company-owned life insurance for Ameren and Ameren Illinois, employee stock ownership plan dividends
for Ameren, and nondeductible expenses for Ameren Illinois.
147
The following table presents the components of income tax expense (benefit) for the years ended December 31, 2011,
2010, and 2009:
Ameren(a)
Ameren Missouri Ameren Illinois
Genco
2011:
Current taxes:
Federal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Deferred taxes:
Federal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred investment tax credits, amortization . . . . . . . . . . . . . . . . . . . . . . .
Total income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
2010:
Current taxes:
Federal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Deferred taxes:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Federal
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred investment tax credits, amortization . . . . . . . . . . . . . . . . . . . . . . .
Total income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
2009:
Current taxes:
Federal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Deferred taxes:
Federal
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred investment tax credits, amortization . . . . . . . . . . . . . . . . . . . . . . .
Total income tax expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
(27)
(5)
273
76
(7)
310
13
10
274
36
(8)
325
(73)
3
337
74
(9)
332
$
$
$
$
$
$
3
2
129
31
(4)
161
(14)
(15)
206
27
(5)
199
(117)
(31)
239
42
(5)
128
$
$
$
$
$
$
(24)
(4)
123
34
(2)
127
(20)
(5)
132
32
(2)
137
(8)
14
64
11
(2)
79
$
$
$
$
$
(21)
(7)
43
18
(1)
32
(5)
6
22
(2)
(1)
20
22
14
57
9
(1)
$
101
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
The Illinois corporate income tax rate increased from 7.3% to 9.5%, starting in January 2011. The tax rate is scheduled to
decrease to 7.75% in 2015, and it is scheduled to return to 7.3% in 2025. This corporate income tax rate increase in Illinois
increased current income tax expense in 2011 by $6 million, $4 million and $3 million for Ameren, Ameren Illinois and Genco,
respectively. As a result of this corporate income tax rate increase, accumulated deferred tax balances were revalued, resulting
in a decrease in deferred tax expense of $2 million, $3 million and $- million for Ameren, Ameren Illinois, and Genco,
respectively.
The following table presents the deferred tax assets and deferred tax liabilities recorded as a result of temporary
differences at December 31, 2011, and 2010:
Ameren(a)
Ameren Missouri
Ameren Illinois
Genco
2011:
Accumulated deferred income taxes, net liability (asset):
Plant related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred intercompany tax gain/basis step-up . . . . . . . . . . . . . . . . . . . .
Regulatory assets, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred employee benefit costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
Total net accumulated deferred income tax liabilities(b) . . . . . . . . . . . . . . . .
$
2010:
Accumulated deferred income taxes, net liability (asset):
Plant related . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred intercompany tax gain/basis step-up . . . . . . . . . . . . . . . . . . . .
Regulatory assets (liabilities), net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Deferred employee benefit costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Purchase accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
ARO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total net accumulated deferred income tax liabilities(c) . . . . . . . . . . . . . . . .
$
$
3,811
3
73
(367)
35
(37)
(223)
3,295
3,310
2
67
(360)
106
(48)
(120)
2,957
$
$
$
$
2,134
(1)
73
(88)
-
-
6
2,124
1,974
(2)
68
(87)
-
(9)
7
1,951
$
$
$
$
$
1,003
55
-
(109)
(27)
1
(86)
837
$
750
71
(1)
(124)
41
1
(57)
681
$
$
457
(54)
-
(67)
15
(25)
(22)
304
378
(68)
-
(45)
17
(27)
10
265
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
148
(b)
(c)
Includes $20 million, $8 million and $58 million as current assets recorded in the balance sheet for Ameren, Ameren Missouri and Ameren
Illinois, respectively.
Includes $43 million as current assets recorded in the balance sheet for Ameren Illinois. Includes $71 million, $43 million and $12 million as
current liabilities recorded in the balance sheets for Ameren, Ameren Missouri and Genco, respectively.
The following table presents the components of deferred tax assets relating to net operating loss carryforwards and tax
credit carryforwards at December 31, 2011:
Net operating loss carryforwards:
Federal(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State(b)
Total net operating loss carryforwards . . . . . . . . . . . . . . . . . . . . . . . . .
Tax credit carryforwards:
Federal(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
State(d)
Total tax credit carryforwards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren
$
$
$
$
136
17
153
72
28
100
Ameren
Missouri
Ameren
Illinois
Genco
$
$
$
$
50
3
53
11
1
12
$
$
$
$
33
6
39
-
-
-
$
$
$
$
8
-
8
1
4
5
(a) These will begin to expire in 2028.
(b) These will begin to expire in 2017.
(c) These will begin to expire in 2029.
(d) These will begin to expire in 2012.
Uncertain Tax Positions
A reconciliation of the change in the unrecognized tax benefit balance during the years ended December 31, 2009, 2010,
and 2011, is as follows:
Ameren
Ameren
Missouri
Ameren
Illinois
Genco
Unrecognized tax benefits – January 1, 2009 . . . . . . . . . . . . . . . . . . . .
Increases based on tax positions prior to 2009 . . . . . . . . . . . . . . . .
Decreases based on tax positions prior to 2009 . . . . . . . . . . . . . . . .
Increases based on tax positions related to 2009 . . . . . . . . . . . . . . .
Changes related to settlements with taxing authorities . . . . . . . . . . .
Decreases related to the lapse of statute of limitations . . . . . . . . . . .
Unrecognized tax benefits – December 31, 2009 . . . . . . . . . . . . . . . . .
Increases based on tax positions prior to 2010 . . . . . . . . . . . . . . . .
Decreases based on tax positions prior to 2010 . . . . . . . . . . . . . . . .
Increases based on tax positions related to 2010 . . . . . . . . . . . . . . .
Changes related to settlements with taxing authorities . . . . . . . . . . .
Decreases related to the lapse of statute of limitations . . . . . . . . . . .
Unrecognized tax benefits – December 31, 2010 . . . . . . . . . . . . . . . . .
Increases based on tax positions prior to 2011 . . . . . . . . . . . . . . . .
Decreases based on tax positions prior to 2011 . . . . . . . . . . . . . . . .
Increases based on tax positions related to 2011 . . . . . . . . . . . . . . .
Changes related to settlements with taxing authorities . . . . . . . . . . .
Decreases related to the lapse of statute of limitations . . . . . . . . . . .
$
$
$
110
90
(84)
19
-
-
135
72
(38)
77
-
-
246
22
(125)
17
(10)
(2)
Unrecognized tax benefits – December 31, 2011 . . . . . . . . . . . . . . . . .
$
148
Total unrecognized tax benefits (detriments) that, if recognized, would
affect the effective tax rates as of December 31, 2009 . . . . . . . . . . .
Total unrecognized tax benefits that, if recognized, would affect the
effective tax rates as of December 31, 2010 . . . . . . . . . . . . . . . . . . .
Total unrecognized tax benefits that, if recognized, would affect the
effective tax rates as of December 31, 2011 . . . . . . . . . . . . . . . . . . .
$
$
$
6
-
1
$
$
$
$
$
$
$
20
76
(19)
11
-
-
88
40
(12)
48
-
-
164
15
(63)
13
(5)
-
124
3
3
1
$
$
$
$
$
$
$
-
-
-
-
-
-
-
27
(2)
31
-
-
56
-
(41)
-
(4)
-
11
-
-
-
$
$
$
$
$
$
$
48
9
(31)
3
-
-
29
4
(16)
3
-
-
20
1
(12)
1
-
(1)
9
-
1
1
The Ameren Companies recognize interest charges (income) and penalties accrued on tax liabilities on a pretax basis as
interest charges (income) or miscellaneous expense in the statements of income.
149
A reconciliation of the change in the liability for interest on unrecognized tax benefits during the years ended
December 31, 2009, 2010, and 2011, is as follows:
Ameren
Ameren
Missouri
Ameren
Illinois
Genco
Liability for interest – January 1, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges (income) for 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liability for interest – December 31, 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges for 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liability for interest – December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest income for 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liability for interest – December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
$
10
(2)
8
9
17
(11)
(1)
5
$
$
$
$
2
2
4
6
10
(3)
(1)
6
$
$
$
$
-
-
-
2
2
(1)
-
1
$
$
$
$
4
(2)
2
-
2
(1)
-
1
As of December 31, 2009, December 31, 2010, and December 31, 2011, the Ameren Companies have accrued no amount
for penalties with respect to unrecognized tax benefits.
In the second quarter of 2011, a final settlement for the years 2005 and 2006 was reached with the Internal Revenue
Service. It resulted in the reduction of uncertain tax liabilities by $39 million, $17 million, $12 million, and $4 million for
Ameren, Ameren Missouri, Ameren Illinois and Genco, respectively. Ameren’s federal income tax returns for the years 2007
through 2009 are before the Appeals Office of the Internal Revenue Service. Ameren’s federal income tax return for the year
2010 is currently under examination.
State income tax returns are generally subject to examination for a period of three years after filing of the return. The state
impact of any federal changes remains subject to examination by various states for a period of up to one year after formal
notification to the states. The Ameren Companies do not currently have material state income tax issues under examination,
administrative appeals, or litigation.
It is expected that a partial settlement will be reached with the Appeals Office of the Internal Revenue Service in the next
twelve months for the years 2007 through 2009 that would result in a decrease in uncertain tax liabilities. In addition, it is
reasonably possible that other events will occur during the next 12 months that would cause the total amount of unrecognized
tax benefits for the Ameren Companies to increase or decrease. However, the Ameren Companies do not believe any such
increases or decreases would be material to their results of operations, financial position, or liquidity.
NOTE 14 – RELATED PARTY TRANSACTIONS
The Ameren Companies have engaged in, and may in
the future engage in, affiliate transactions in the normal
course of business. These transactions primarily consist of
natural gas and power purchases and sales, services
received or rendered, and borrowings and lendings.
Transactions between affiliates are reported as
intercompany transactions on their financial statements, but
are eliminated in consolidation for Ameren’s financial
statements. Below are the material related party
agreements.
Electric Power Supply Agreements
Genco Power Supply Agreements
The following table presents the amount of physical
gigawatthour sales under Genco’s related party electric
power supply agreements with Marketing Company,
including EEI’s power supply agreement with Marketing
Company, for the years ended December 31, 2011, 2010,
and 2009:
Genco sales to Marketing Company . . . . . 21,040 21,656 19,598
December 31,
2011
2010
2009
Genco entered into a power supply agreement, as
amended (PSA), with Marketing Company, whereby Genco
agreed to sell and Marketing Company agreed to purchase
all of the capacity and energy available from Genco’s
generation fleet. Marketing Company entered into a similar
PSA with AERG. Under the PSAs, revenues allocated
between Genco and AERG are based on reimbursable
expenses and generation. Each PSA will continue through
December 31, 2022, and from year to year thereafter unless
either party to the respective PSA elects to terminate the
PSA by providing the other party with no less than six
months advance written notice.
In December 2005, EEI entered into a PSA with
Marketing Company, whereby EEI agreed to sell and
Marketing Company agreed to purchase all of the capacity
and energy available from EEI’s generation fleet. The price
that Marketing Company pays for capacity is set annually
based upon prevailing market prices. Marketing Company
pays spot market prices for the associated energy. In
addition, EEI will at times purchase energy from Marketing
Company to fulfill obligations to a nonaffiliated party. This
PSA will continue through May 31, 2016, unless either
party elects to terminate the PSA by providing the other
party with no less than four years advance written notice or
five days’ written notice in the event of a default, unless the
default is cured within 30 business days.
150
Capacity Supply Agreements
Ameren Illinois, as an electric load-serving entity, must
acquire capacity sufficient to meet its obligations to
customers.
Ameren Illinois used RFP processes in early 2008,
pursuant to the 2007 Illinois Electric Settlement Agreement,
to contract for the necessary capacity requirements for the
period from June 1, 2008, through May 31, 2009. Both
Marketing Company and Ameren Missouri were among the
winning suppliers in the capacity RFPs. Marketing Company
contracted to supply a portion of Ameren Illinois’ capacity
requirements for $6 million. In addition, Ameren Missouri
contracted to supply a portion of the Ameren Illinois’
capacity for $1 million.
In 2009, Ameren Illinois used a RFP process,
administered by the IPA, to contract capacity for the period
from June 1, 2009, through May 31, 2012. Both Marketing
Company and Ameren Missouri were among the winning
suppliers in the capacity RFP process. In April 2009,
Marketing Company contracted to supply a portion of
Ameren Illinois’ capacity requirements to Ameren Illinois for
$4 million, $9 million, and $8 million for the 12 months
ending May 31, 2010, 2011, and 2012, respectively. In April
2009, Ameren Missouri contracted to supply a portion of
Ameren Illinois’ capacity requirements to Ameren Illinois for
$2 million, $2 million, and $1 million for the 12 months
ending May 31, 2010, 2011, and 2012, respectively.
In 2010, Ameren Illinois used a RFP process,
administered by the IPA, to contract capacity for the period
from June 1, 2010, through May 31, 2013. Both Marketing
Company and Ameren Missouri were among the winning
suppliers in the capacity RFP process. In April 2010,
Marketing Company contracted to supply a portion of
Ameren Illinois’ capacity requirements to Ameren Illinois for
$1 million, $2 million, and $3 million for the 12 months
ending May 31, 2011, 2012, and 2013, respectively. In April
2010, Ameren Missouri contracted to supply a portion of
Ameren Illinois’ capacity requirements to Ameren Illinois for
less than $1 million for the period from June 1, 2010,
through May 31, 2013.
Energy Swaps and Energy Products
Ameren Illinois, as an electric load-serving entity, must
acquire energy sufficient to meet its obligations to
customers.
As part of the 2007 Illinois Electric Settlement
Agreement, Ameren Illinois entered into financial contracts
with Marketing Company (for the benefit of Genco and
AERG) to lock in energy prices for 400 to 1,000 megawatts
annually of its round-the-clock power requirements during
the period June 1, 2008, to December 31, 2012, at then-
relevant market prices. These financial contracts do not
include capacity, are not load-following products, and do
not involve the physical delivery of energy. These financial
contracts are derivative instruments. They are accounted for
as cash flow hedges by Marketing Company and as
derivatives subject to regulatory deferral by Ameren Illinois.
Consequently, Ameren Illinois and Marketing Company
record the fair value of the contracts on their respective
balance sheets and the changes to the fair value in
regulatory assets or liabilities for Ameren Illinois and OCI at
Marketing Company. See Note 7 – Derivative Financial
Instruments for additional information on these derivatives.
Below are the remaining contracted volumes and prices per
megawatthour as of December 31, 2011:
Period
Volume
Price per
Megawatthour
January 1, 2012 – December 31, 2012 . . . . . 1,000 MW $
53.08
Ameren Illinois used RFP processes in early 2008,
pursuant to the 2007 Illinois Electric Settlement Agreement,
to contract for the necessary financial energy swaps
required for the period from June 1, 2008, through May 31,
2009. Marketing Company was a winning supplier in
Ameren Illinois’ energy swap RFP process. Marketing
Company entered into financial instruments that fixed the
price that Ameren Illinois paid for about 2 million
megawatthours at approximately $60 per megawatthour.
In 2009, Ameren Illinois used a RFP process,
administered by the IPA, to procure financial energy swaps
from June 1, 2009, through May 31, 2011. Marketing
Company was a winning supplier in the financial energy
swap RFP process. In May 2009, Marketing Company
entered into financial instruments that fixed the price that
Ameren Illinois paid for approximately 80,000
megawatthours at approximately $48 per megawatthour
during the 12 months ending May 31, 2010, and for
approximately 89,000 megawatthours at approximately $48
per megawatthour during the 12 months ending May 31,
2011.
In 2010, Ameren Illinois used a RFP process,
administered by the IPA, to procure financial energy swaps
for the period from June 1, 2010, through May 31, 2013.
Marketing Company was a winning supplier in the financial
energy swap RFP process. In May 2010, Marketing
Company entered into financial instruments that fixed the
price that Ameren Illinois will pay for approximately
924,000 megawatthours at approximately $33 per
megawatthour during the 12 months ending May 31, 2011,
and for approximately 296,000 megawatthours at
approximately $40 per megawatthour during the 12 months
ending May 31, 2012.
Energy Products
In 2011, Ameren Illinois used a RFP process
administered by the IPA to procure energy products that
will settle physically from June 1, 2011, through May 31,
2014. Marketing Company and Ameren Missouri were
winning suppliers in Ameren Illinois’ energy product RFP
process. In May 2011, Marketing Company and Ameren
Illinois entered into energy product agreements by which
Marketing Company will sell and Ameren Illinois will
purchase approximately 1,747,200 megawatthours at
approximately $37 per megawatthour during the 12 months
151
ending May 31, 2012, approximately 1,840,800
megawatthours at approximately $42 per megawatthour
during the 12 months ending May 31, 2013, and
approximately 650,000 megawatthours at approximately
$42 per megawatthour during the 12 months ending
May 31, 2014. In May 2011, Ameren Missouri and Ameren
Illinois entered into energy product agreements by which
Ameren Missouri will sell and Ameren Illinois will purchase
approximately 16,800 megawatthours at approximately $37
per megawatthour during the 12 months ending May 31,
2012, approximately 40,800 megawatthours at
approximately $29 per megawatthour during the 12 months
ending May 31, 2013, and approximately 40,800
megawatthours at approximately $28 per megawatthour
during the 12 months ending May 31, 2014. The 2012 and
2013 energy product agreements between Ameren Missouri
and Ameren Illinois are for off-peak hours only.
In February 2012, a rate stability procurement for
energy products that will settle physically was administered
by the IPA for the June 2013 through May 2017 period to
meet certain requirements for purchased power related to
the IEIMA. Marketing Company was a winning supplier in
Ameren Illinois’ energy product procurement process. In
February 2012, Marketing Company and Ameren Illinois
entered into energy product agreements pursuant to which
Marketing Company will sell and Ameren Illinois will
purchase approximately 3,942,000 megawatthours at
approximately $30 per megawatthour during the 12 months
ending May 31, 2014, approximately 3,504,000
megawatthours at approximately $32 per megawatthour
during the 12 months ending May 31, 2015, and
approximately 1,317,600 megawatthours at approximately
$34 per megawatthour during the 12 months ending
May 31, 2016. The energy product agreements were based
on around-the-clock prices.
In January 2011, ATXI repaid advances for the
construction of transmission assets to Ameren Illinois in the
amount of $52 million, including $3 million of accrued interest.
In March 2011, Ameren Illinois and ATXI signed an
agreement to transfer, at cost, all of ATXI’s construction
work in progress assets related to the construction of a
transmission line to Ameren Illinois for $20 million. In April
2011, Ameren Illinois paid ATXI for these assets.
Support Services Agreements
Ameren Services provides support services to its
affiliates. The costs of support services, including wages,
employee benefits, professional services, and other
expenses, are based on, or are an allocation of, actual costs
incurred. AFS provided support services to its affiliates
through December 31, 2010. Effective January 1, 2011, the
services previously performed by AFS are performed within
the Ameren Missouri, Ameren Illinois and Merchant
Generation business segments. In addition, Ameren
Missouri, Ameren Illinois and Genco provide affiliates,
primarily Ameren Services, with access to their facilities for
administrative purposes. The cost of the rent and facility
services are based on, or are an allocation of, actual costs
incurred.
Gas Sales and Transportation Agreement
Under a gas transportation agreement, Genco acquires
gas transportation service from Ameren Missouri. This
agreement expires in February 2016.
Money Pools
See Note 5 – Long-term Debt and Equity Financings for
discussion of affiliate borrowing arrangements.
Interconnection and Transmission Agreements
Collateral Postings
Ameren Missouri and Ameren Illinois are parties to an
interconnection agreement for the use of their respective
transmission lines and other facilities for the distribution of
power. These agreements have no contractual expiration
date, but may be terminated by either party with three years’
notice.
Joint Ownership Agreement
ATXI and Ameren Illinois have a joint ownership
agreement to construct, own, operate, and maintain certain
electric transmission assets in Illinois. Under the terms of
this agreement, Ameren Illinois and ATXI are responsible
for their applicable share of all costs related to the
construction, operation, and maintenance of electric
transmission systems. Ameren is the primary beneficiary of
ATXI, and therefore consolidates ATXI. Currently, there are
no construction projects or joint ownership of existing
assets under this agreement.
Under the terms of the 2011, 2010, and 2009 Illinois
power procurement agreements entered into through a RFP
process administered by the IPA, suppliers must post
collateral under certain market conditions to protect Ameren
Illinois in the event of nonperformance. The collateral
postings are unilateral, meaning that only the suppliers
would be required to post collateral. Therefore, Ameren
Missouri, as a winning supplier of capacity and energy
products, and Marketing Company, as a winning supplier of
capacity, financial energy swaps, and energy products, may
be required to post collateral. As of December 31, 2011,
and 2010, there were no collateral postings required of
Ameren Missouri or Marketing Company related to the
2011, 2010, and 2009 Illinois power procurement
agreements.
Intercompany Transfers
On October 1, 2010, Ameren Illinois distributed
AERG’s common stock to Ameren in connection with the
Ameren Illinois Merger. Ameren subsequently contributed
152
the AERG common stock to AER. The distribution of AERG
common stock was accounted for as a transaction between
entities under common control; therefore, Ameren Illinois
transferred AERG to Ameren based on AERG’s carrying
value. See Note 16 – Corporate Reorganization and
Discontinued Operations for additional information.
The following table presents the impact on Ameren Missouri, Ameren Illinois and Genco, of related party transactions for
the years ended December 31, 2011, 2010, and 2009. It is based primarily on the agreements discussed above and the money
pool arrangements discussed in Note 4 – Short-Term Debt and Liquidity.
Ameren
Missouri
Ameren
Illinois
Genco
$
$
(a)
(a)
(a)
(a) $ 1,006
1,059
(a)
1,071
(a)
2
2
3
1
1
1
(a)
(a)
(a)
(a)
(a)
(a)
16
16
18
19
19
22
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
$
$
$
$
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
1
1
1
1
1
1
(a)
(a)
(a)
(a)
(a)
(a)
3
2
1
-
1
2
-
1
1
$ 1,009
1,063
1,075
$
$
$
(a) $
(a)
(a)
$
232
233
400
2
2
3
-
-
(b)
(a)
(a)
(a)
$
$
234
235
403
1
1
1
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
(a)
36
11
42
37
12
43
Agreement
Income Statement Line Item
Genco and EEI power supply
agreements with Marketing Company
Operating Revenues
Ameren Missouri power supply agreements
with Ameren Illinois
Operating Revenues
Ameren Missouri and Genco gas
transportation agreement
Operating Revenues
Genco gas sales to Medina Valley
Operating Revenues
Genco gas sales to distribution companies
Operating Revenues
Ameren Missouri, Ameren Illinois
and Genco rent and facility services
Operating Revenues
Total Operating Revenues
Ameren Missouri and Genco gas
transportation agreement
Fuel
Ameren Illinois power supply agreements
with Marketing Company
Ameren Illinois power supply
agreements with Ameren Missouri
Ameren Illinois ancillary services agreement
with Marketing Company
EEI power supply agreement with
Marketing Company
Total Purchased Power
Purchased Power
Purchased Power
Purchased Power
Purchased Power
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
153
Agreement
Gas purchases from Genco
Income Statement Line Item
Gas Purchased for Resale
Ameren Services support services
agreement
AFS support services agreement
Insurance premiums(c)
Total Other Operations and
Maintenance Expenses
Money pool borrowings (advances)
Other Operations and
Maintenance
Other Operations and
Maintenance
Other Operations and
Maintenance
Interest (Charges)
Income
Ameren
Missouri
Ameren
Illinois
$
(a)
(a)
(a)
$ 114
128
131
$
$
-
1
2
90
102
101
(a)
7
7
(b)
1
2
(a)
(b)
6
(a)
(a)
(a)
Genco
$ (a)
(a)
(a)
$ 19
23
27
(a)
3
3
-
-
1
$ 114
136
140
$
-
-
-
$
$
90
102
107
-
(b)
(b)
$ 19
26
31
$ (b)
(b)
(1)
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
2011
2010
2009
(a) Not applicable.
(b) Amount less than $1 million.
(c) Represents insurance premiums paid to Energy Risk Assurance Company, an affiliate for replacement power, property damage, and terrorism
coverage.
NOTE 15 – COMMITMENTS AND CONTINGENCIES
We are involved in legal, tax and regulatory proceedings before various courts, regulatory commissions, and
governmental agencies with respect to matters that arise in the ordinary course of business, some of which involve substantial
amounts of money. We believe that the final disposition of these proceedings, except as otherwise disclosed in these notes to
our financial statements, will not have a material adverse effect on our results of operations, financial position, or liquidity.
See also Note 1 – Summary of Significant Accounting Policies, Note 2 – Rate and Regulatory Matters, Note 10 – Callaway
Energy Center and Note 14 – Related Party Transactions in this report.
Callaway Energy Center
The following table presents insurance coverage at Ameren Missouri’s Callaway energy center at December 31, 2011. The
property coverage and the nuclear liability coverage must be renewed on April 1 and January 1, respectively, of each year.
Type and Source of Coverage
Maximum Coverages
Maximum Assessments for Single Incidents
Public liability and nuclear worker liability:
American Nuclear Insurers . . . . . . . . . . . . . . . . . .
Pool participation . . . . . . . . . . . . . . . . . . . . . . . . .
Property damage:
Nuclear Electric Insurance Ltd.
. . . . . . . . . . . . . .
Replacement power:
Nuclear Electric Insurance Ltd . . . . . . . . . . . . . . .
Energy Risk Assurance Company . . . . . . . . . . . .
$
$
$
$
$
375
12,219(a)
12,594(c)
2,750(d)
490(e)
64(f)
$
-
118 (b)
$ 118
$
$
$
23
9
-
(a) Provided through mandatory participation in an industrywide retrospective premium assessment program.
(b) Retrospective premium under Price-Anderson. This is subject to retrospective assessment with respect to a covered loss in excess of
$375 million in the event of an incident at any licensed U.S. commercial reactor, payable at $17.5 million per year.
(c) Limit of liability for each incident under the Price-Anderson liability provisions of the Atomic Energy Act of 1954, as amended. A company could
be assessed up to $118 million per incident for each licensed reactor it operates with a maximum of $17.5 million per incident to be paid in a
calendar year for each reactor. This limit is subject to change to account for the effects of inflation and changes in the number of licensed
reactors.
(d) Provides for $500 million in property damage and decontamination, excess property insurance, and premature decommissioning coverage up
to $2.25 billion for losses in excess of the $500 million primary coverage.
(e) Provides the replacement power cost insurance in the event of a prolonged accidental outage at our nuclear energy center. Weekly indemnity
up to $4.5 million for 52 weeks, which commences after the first eight weeks of an outage, plus up to $3.6 million per week for a minimum of
71 weeks thereafter for a total not exceeding the policy limit of $490 million.
154
(f) Provides the replacement power cost insurance in the event of a prolonged accidental outage at our nuclear energy center. The coverage
commences after the first 52 weeks of insurance coverage from Nuclear Electric Insurance Ltd. and is for a weekly indemnity of $900,000 for
71 weeks in excess of the $3.6 million per week set forth above. Energy Risk Assurance Company is an affiliate and has reinsured this coverage
with third-party insurance companies. See Note 14 – Related Party Transactions for more information on this affiliate transaction.
The Price-Anderson Act is a federal law that limits the liability for claims from an incident involving any licensed United
States commercial nuclear power facility. The limit is based on the number of licensed reactors. The limit of liability and the
maximum potential annual payments are adjusted at least every five years for inflation to reflect changes in the Consumer
Price Index. The five-year inflationary adjustment as prescribed by the most recent Price-Anderson Act renewal was effective
October 29, 2008. Owners of a nuclear reactor cover this exposure through a combination of private insurance and mandatory
participation in a financial protection pool, as established by Price-Anderson.
Losses resulting from terrorist attacks are covered under Nuclear Electric Insurance Ltd.’s policies, subject to an
industrywide aggregate policy limit of $3.24 billion within a 12-month period for coverage for such terrorist acts.
If losses from a nuclear incident at the Callaway energy center exceed the limits of, or are not covered by, insurance, or if
coverage is unavailable, Ameren Missouri is at risk for any uninsured losses. If a serious nuclear incident were to occur, it
could have a material adverse effect on Ameren’s and Ameren Missouri’s results of operations, financial position, or liquidity.
Leases
We lease various facilities, office equipment, plant equipment, and rail cars under operating leases. The following table
presents our lease obligations at December 31, 2011:
Total
2012
2013
2014
2015
2016 After 5 Years
Ameren:(a)
Capital lease payments(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less amount representing interest . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 621
312
$ 33
28
Present value of minimum capital lease payments . . . . . . . . . . . . . .
$ 309
$
Operating leases(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
307
5
38
$ 32
27
$
5
32
$ 32
27
$
5
26
$ 33
27
$
6
26
$ 33
27
$
6
25
$ 458
176
$ 282
160
Total lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 616
$ 43
$ 37
$ 31
$ 32
$ 31
$ 442
Ameren Missouri:
Capital lease payments(b)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Less amount representing interest . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 621
312
$ 33
28
Present value of minimum capital lease payments . . . . . . . . . . . . . .
$ 309
$
Operating leases(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
134
5
13
$ 32
27
$
5
12
$ 32
27
$
5
12
$ 33
27
$
6
12
$ 33
27
$
6
12
$ 458
176
$ 282
73
Total lease obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 443
$ 18
$ 17
$ 17
$ 18
$ 18
$ 355
Ameren Illinois:
Operating leases(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco:
Operating leases(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
7
$
1
$
1
$
1
$
1
$
1
$
2
$ 131
$ 11
$ 11
$ 11
$ 10
$ 11
$
77
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
(a)
(b) See Properties under Part I, Item 2, and Note 3 – Property and Plant, Net of this report for additional information.
(c) Amounts related to certain real estate leases and railroad licenses have indefinite payment periods. Ameren’s $2 million annual obligation for
these items is included in the 2012 through 2016 columns. The amounts for the indefinite payments are not included in the After 5 Years
column because that period is indefinite.
The following table presents total rental expense, included in operating expenses, for the years ended December 31, 2011,
2010 and 2009:
Ameren(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri
Ameren Illinois . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
47
29
17
12
$
52
29
19
13
$
50
30
19
15
2011
2010
2009
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
155
Other Obligations
To supply a portion of the fuel requirements of our generating plants, we have entered into various long-term
commitments for the procurement of coal, natural gas, nuclear fuel, and methane gas. We also have entered into various long-
term commitments for purchased power and natural gas for distribution. The table below presents our estimated fuel,
purchased power, and other commitments at December 31, 2011. Ameren’s and Ameren Missouri’s coal commitments
include multiyear agreements to procure ultra-low-sulfur coal and related transportation from the Powder River Basin in
Wyoming. Ameren’s and Ameren Missouri’s purchased power obligations include a 102-MW power purchase agreement with
a wind farm operator that expires in 2024. Ameren’s and Ameren Illinois’ purchased power obligations include the Ameren
Illinois power purchase agreements entered into as part of the IPA-administered power procurement process. Included in the
Other column are minimum purchase commitments under contracts for equipment, design and construction, meter reading
services, and an Ameren tax credit obligation at December 31, 2011. Ameren’s tax credit obligation is a $17 million note
payable issued for an investment in a commercial real estate development partnership to acquire tax credits. This note payable
was netted against the related investment in “Other assets” on Ameren’s balance sheet at December 31, 2011, as Ameren has
a legally enforceable right to offset under authoritative accounting guidance.
Ameren:(a)
2012 . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . .
2016 . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . .
Ameren Missouri:
2012 . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . .
2016 . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . .
Coal
$ 1,120
792
692
687
674
968
$ 4,933
$
623
605
625
614
644
921
Total
. . . . . . . . . . . . . . . . . . .
$ 4,032
$
$
$
Ameren Illinois:
2012 . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . .
2016 . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . .
Genco:
2012 . . . . . . . . . . . . . . . . . . .
2013 . . . . . . . . . . . . . . . . . . .
2014 . . . . . . . . . . . . . . . . . . .
2015 . . . . . . . . . . . . . . . . . . .
2016 . . . . . . . . . . . . . . . . . . .
Thereafter . . . . . . . . . . . . . . .
Total
. . . . . . . . . . . . . . . . . . .
$
-
-
-
-
-
-
-
355
108
40
45
-
-
548
Natural
Gas
Nuclear
Fuel
Purchased
Power
Methane
Gas
Other
Total
$
$
$
$
$
$
$
$
398
295
220
116
39
134
$ 1,202
$
$
$
$
$
63
48
36
19
7
30
203
324
243
180
94
31
105
977
9
4
3
2
-
-
$
18
$
36
37
96
90
100
298
657
36
37
96
90
100
298
657
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
$
$
$
$
$
$
$
196
309
125
51
52
746
1,479
19
19
19
19
19
155
250
177
290
106
32
33
591
1,229
-
-
-
-
-
-
-
$
$
$
$
$
$
$
$
1
3
3
3
3
94
107
1
3
3
3
3
94
107
-
-
-
-
-
-
-
-
-
-
-
-
-
-
$
$
$
$
$
$
$
$
$
$
$
$
$
$
221
80
75
52
62
246
736
78
50
47
28
38
144
385
24
22
22
24
24
102
218
98
5
5
-
-
-
$
108
$
1,972
1,516
1,211
999
930
2,486
9,114
820
762
826
773
811
1,642
5,634
525
555
308
150
88
798
2,424
462
117
48
47
-
-
674
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.
Also, as part of the 2007 Illinois Electric Settlement
Agreement, Ameren Illinois entered into financial contracts
with Marketing Company to lock in energy prices for 400 to
1,000 megawatts annually of their round-the-clock power
requirements from 2008 to 2012. These commitments are
not reflected in the above table. See Note 7 – Derivative
Financial Instruments and Note 14 – Related Party
Transactions for additional information.
In February 2012, a rate stability procurement for
energy products and renewable energy credits was
administered by the IPA for the June 2013 through May
2017 period to meet certain requirements for purchased
power related to the IEIMA. Ameren Illinois contracted to
purchase approximately 13 million megawatthours of
energy products at an average price of approximately $31
per megawatthour. Ameren Illinois is currently reviewing
156
the results of the renewable energy credits procurement
proceeding.
Ameren Illinois has entered into an agreement to
purchase approximately 15.5 billion cubic feet of synthetic
natural gas annually over a 10-year period beginning in
2016 for its natural gas customers. The agreement is
contingent on the counterparty reaching certain milestones
during the project development and the construction of the
plant that will produce the synthetic natural gas.
Construction has not begun on the plant; therefore, Ameren
Illinois’ obligations are not yet certain at this time. The
agreement was entered into pursuant to an Illinois law,
which became effective August 2, 2011, and provides that
all contract costs for synthetic natural gas incurred by
Ameren Illinois are reasonable and prudent and recoverable
through the PGA and are not subject to review or
disallowance by the ICC.
Environmental Matters
We are subject to various environmental laws and
regulations enforced by federal, state, and local authorities.
From the beginning phases of siting and development to the
ongoing operation of existing or new electric generating,
transmission and distribution facilities and natural gas
storage, transmission and distribution facilities, our
activities involve compliance with diverse environmental
laws and regulations. These laws and regulations address
emissions, impacts to air, land and water, noise, protected
natural and cultural resources (such as wetlands,
endangered species and other protected wildlife, and
archeological and historical resources), and chemical and
waste handling. Complex and lengthy processes are
required to obtain approvals, permits, or licenses for new,
existing or modified facilities. Additionally, the use and
handling of various chemicals or hazardous materials
(including wastes) requires release prevention plans and
emergency response procedures.
In addition to existing laws and regulations, including
the Illinois MPS that applies to our energy centers in
Illinois, the EPA is developing numerous new environmental
regulations that will have a significant impact on the electric
utility industry. These regulations could be particularly
burdensome for certain companies, including Ameren,
Ameren Missouri and Genco, that operate coal-fired energy
centers. Significant new rules proposed or promulgated
since the beginning of 2010 include the regulation of
greenhouse gas emissions; revised national ambient air
quality standards for SO2 and NO2 emissions; the CSAPR,
which requires further reductions of SO2 and NOx emissions
from power plants; a regulation governing management of
CCR and coal ash impoundments; the MATS, which
requires reduction of emissions of mercury, toxic metals,
and acid gases from power plants; revised NSPS for
particulate matter, SO2, and NOx emissions from new
sources; and new regulations under the Clean Water Act
that could require significant capital expenditures such as
new water intake structures or cooling towers at our energy
centers. The EPA also plans to propose an additional rule,
applicable to new and existing electric generating units,
governing NSPS and emission guidelines for greenhouse
gas emissions. These new regulations may be litigated, so
the timing of their implementation is uncertain, as
evidenced by the stay of the CSAPR by the United States
Court of Appeals for the District of Columbia on
December 30, 2011. Although many details of these future
regulations are unknown, the combined effects of the new
and proposed environmental regulations may result in
significant capital expenditures and/or increased operating
costs over the next five to ten years for Ameren, Ameren
Missouri and Genco. Actions required to ensure that our
facilities and operations are in compliance with
environmental laws and regulations could be prohibitively
expensive. If they are, these regulations could require us to
close or to significantly alter the operation of our energy
centers, which could have an adverse effect on our results
of operations, financial position, and liquidity, including the
impairment of plant assets. Failure to comply with
environmental laws and regulations might also result in the
imposition of fines, penalties, and injunctive measures.
The estimates in the table below contain all of the
known capital costs to comply with existing environmental
regulations and our assessment of the potential impacts of
the EPA’s proposed regulation for CCR, the recently
finalized MATS, the stayed CSAPR as currently designed,
and the revised national ambient air quality standards for
SO2 and NOx emissions as of December 31, 2011. The
estimates in the table below assume that CCR will continue
to be regarded as nonhazardous. The estimates in the table
below do not include the impacts of new regulations
proposed by the EPA under the Clean Water Act in March
2011 regarding cooling water intake structures as our
evaluation of those impacts is ongoing. The estimates
shown in the table below could change significantly
depending upon a variety of factors including:
‰
‰
‰
additional federal or state requirements;
regulation of greenhouse gas emissions;
new national ambient air quality standards or changes
to existing standards for ozone, fine particulates, SO2,
and NOx emissions;
additional rules governing air pollutant transport;
finalized regulations under the Clean Water Act;
CCR being classified as hazardous;
whether the CSAPR is implemented and whether any
modifications are made to its existing requirements;
new technology;
expected power prices;
variations in costs of material or labor; and
alternative compliance strategies or investment
decisions.
‰
‰
‰
‰
‰
‰
‰
‰
2012 2013 - 2016
2017 - 2021
Total
AMO(a) . . . . . $ 55 $ 325 - $ 400 $
150
Genco . . . . .
5
AERG . . . . . .
100 -
20 -
125
25
845 - $1,030 $ 1,225 - $ 1,485
570
245 -
130
80 -
495 -
105 -
295
100
Ameren . . . . $ 210 $ 445 - $ 550 $1,170 - $ 1,425 $ 1,825 - $ 2,185
(a) Ameren Missouri’s expenditures are expected to be recoverable
from ratepayers.
157
The decision to make pollution control equipment
investments at our Merchant Generation business depends
on whether the expected future market price for power
reflects the increased cost for environmental compliance. In
early 2012, there has been a decline in the market price for
wholesale power because of factors such as declining
natural gas prices and the stay of the CSAPR. As a result of
this decline in the market price for power, as well as
uncertain environmental regulations, Genco is decelerating
the construction of two scrubbers at of its Newton energy
center. These scrubbers were originally expected to be
installed in late 2013 and spring 2014. The ultimate
installation of these scrubbers, now estimated to occur
between 2017 and 2021 in the table above, has been
postponed until such time as the incremental investment
necessary for completion is justified by visible market
conditions. However, Genco will continue to incur capital
costs related to the construction of these scrubbers. The
table above includes Genco’s estimated costs of
approximately $150 million in 2012 and approximately
$20 million annually, excluding capitalized interest, from
2013 through 2016 for the construction of the two
scrubbers. In addition to Genco’s reduction in estimated
capital expenditures, AERG is deferring precipitator
upgrades at its E.D. Edwards energy center beyond 2016.
The following sections describe the more significant
environmental rules that affect our operations.
Clean Air Act
Both federal and state laws require significant
reductions in SO2 and NOx emissions that result from
burning fossil fuels. In March 2005, the EPA issued
regulations with respect to SO2 and NOx emissions (the
CAIR). The CAIR required generating facilities in 28 states,
including Missouri and Illinois, and the District of Columbia
to participate in cap-and-trade programs to reduce annual
SO2 emissions, annual NOx emissions, and ozone season
NOx emissions.
In December 2008, the United States Court of Appeals
for the District of Columbia remanded the CAIR to the EPA
for further action to remedy the rule’s flaws, but allowed the
CAIR’s cap-and-trade programs to remain effective until
they are replaced by the EPA. In July 2011, the EPA issued
the CSAPR as the CAIR replacement. The CSAPR was to
become effective on January 1, 2012, for SO2 and annual
NOx reductions and on May 1, 2012, for ozone season NOx
reductions. In the CSAPR, the EPA developed federal
implementation plans for each state covered by this rule;
however, each impacted state can develop its own
implementation rule starting as early as 2013. The CSAPR
establishes emission allowance budgets for each of the
states subject to the regulation, including Missouri and
Illinois. With the CSAPR, the EPA abandoned CAIR’s
regional approach to cutting emissions and instead set a
pollution budget for each of the impacted states based on
the EPA’s analysis of each upwind state’s contribution to air
quality in downwind states. For Missouri and Illinois,
emission reductions were required in two phases beginning
in 2012, with further reductions in 2014. With the CSAPR,
the EPA adopted a cap-and-trade approach that allows
intrastate and limited interstate trading of emission
allowances with other sources within the same program,
that is, in the SO2 program, in the annual NOx, or in ozone
season NOx program. Multiple legal challenges were filed
requesting to have CSAPR partially or entirely vacated and
to stay the implementation of the CSAPR while the court
considers the challenges. On December 30, 2011, the
United States Court of Appeals for the District of Columbia
issued a stay of the CSAPR. The stay does not invalidate the
rule, but only delays its implementation until a final court
ruling is issued. The United States Court of Appeals for the
District of Columbia has expedited its consideration of the
regulation and will hear arguments on the validity of CSAPR
in April 2012. The ultimate outcome of the challenges to the
regulation is uncertain. The court could uphold CSAPR or
remand it back to the EPA for partial or entire revision. Until
the CSAPR appeal process is concluded, the EPA will
continue to administer the CAIR.
On December 21, 2011, the EPA issued the final MATS
under the Clean Air Act, which require emission reductions
for mercury and other hazardous air pollutants, such as
acid gases, toxic metals, and particulate matter by setting
emission limits equal to the average emissions of the best
performing 12% of existing coal and oil-fired electric
generating units. Also, the rule requires reductions in
hydrogen chloride emissions, which were not regulated
previously, and it may require continuous monitoring
systems that are not currently in place. The MATS do not
require a specific control technology to achieve the
emission reductions. The MATS will apply to each unit at a
coal-fired power plant; however, emission compliance can
be averaged for the entire power plant. Compliance is
required by April 2015 or, with a case-by-case extension, by
April 2016.
Separately, in January and June 2010, the EPA
finalized new ambient air quality standards for SO2 and NO2.
It also announced plans for further reductions in the annual
national ambient air quality standards for ozone and fine
particulates. The state of Illinois and the state of Missouri
will be required to develop separate attainment plans to
comply with the new ambient air quality standards. Ameren,
Ameren Missouri and Genco continue to assess the impacts
of these new standards. In September 2011, the EPA
withdrew its draft annual national ambient air quality
standard for ozone and announced that it was implementing
the 2008 national ambient air quality standard for ozone.
The EPA is required to revisit this standard again in 2013.
Ameren Missouri’s current environmental compliance
plan for air emissions from its energy centers includes
burning ultra-low-sulfur coal and installing new or
optimizing existing pollution control equipment. In July
2011, Ameren Missouri contracted to procure significantly
higher volumes of lower-sulfur-content coal than Ameren
Missouri’s energy centers have historically burned, which
will allow Ameren Missouri to eliminate or postpone capital
expenditures for pollution control equipment while still
158
achieving required emissions levels. In 2010, Ameren
Missouri completed the installation of two scrubbers at its
Sioux energy center to reduce SO2 emissions. Currently,
Ameren Missouri’s compliance plan assumes the
installation of two scrubbers within its coal-fired fleet
during the next 10 years and precipitator upgrades at
multiple energy centers. However, Ameren Missouri is
currently evaluating its operations and options to determine
how to comply with the additional emission reductions
requirements in 2014 set forth in the CSAPR, if ultimately
enacted, the MATS, and other recently finalized or proposed
EPA regulations.
Existing Illinois state regulations already required
Ameren and Genco to reduce their emissions of mercury
under the MPS. Ameren’s and Genco’s review of the MATS
indicates that the scope of the federal standards is broader
than the MPS, as no exemption exists for smaller coal-fired
plants. Additionally, the MATS are more stringent than the
MPS because compliance with the MATS is measured on a
quarterly basis and, in some cases, a thirty-day rolling basis
and not annually, as allowed under state requirements. At
the end of 2011, Genco ceased operations of its Meredosia
and Hutsonville energy centers. The closure of these energy
centers was primarily due to the expected cost of complying
with CSAPR and MATS. See Note 17 – Goodwill,
Impairment and Other Charges for additional information.
Genco and AERG expect to install additional, or optimize
existing, pollution control equipment, or modify operations to
meet new and incremental emission reduction requirements
under the MPS, the MATS, or the CSAPR as they become
effective. Under the MPS, as amended, Illinois generators are
required to reduce mercury, SO2, and NOx emissions by 2015.
To comply with the MPS and other air emissions laws and
regulations, Genco and AERG are installing equipment
designed to reduce their emissions of mercury, NOx, and SO2.
Genco and AERG have installed a total of three scrubbers at
two energy centers. Two additional scrubbers are being
constructed at Genco’s Newton energy center. As discussed
above, the timing of the installation of these scrubbers as well
as precipitator upgrades at AERG’s E.D. Edwards energy center
have been delayed. The closure of Genco’s Meredosia and
Hutsonville energy centers will allow the Merchant Generation
segment additional flexibility in the methods to achieve
compliance with environmental standards. Merchant
Generation and Genco will continue to review and adjust their
compliance plans in light of evolving outlooks for power and
capacity prices, delivered fuel costs, environment standards
and compliance technologies, among other factors.
The completion of Ameren’s, Ameren Missouri’s and
Genco’s review of recently finalized environmental
regulations and compliance measures could result in
significant increases in capital expenditures and operating
costs. The compliance costs could be prohibitive at some of
our energy centers as the expected return from these
investments, at current market prices for energy and
capacity, might not justify the required capital expenditures
or their continued operation, which could result in the
impairment of long-lived assets.
Emission Allowances
The Clean Air Act created marketable commodities
called allowances under the acid rain program, the NOx
budget trading program, the CAIR, and the CSAPR. With
the CSAPR, the EPA adopted a cap-and-trade approach that
allows intrastate and limited interstate trading of emission
allowances with other sources within the same program,
that is, either the SO2, annual NOx, or ozone season NOx
programs. As noted above, on December 30, 2011, the
United States Court of Appeals for the District of Columbia
issued a stay of the CSAPR. Until the CSAPR appeal
process is concluded, the EPA will continue to administer
the CAIR including its allowance program. See Note 1 –
Summary of Significant Accounting Policies for the SO2 and
NOx emission allowance book values that were classified as
intangible assets as of December 31, 2011 and 2010, and
Note 17 – Goodwill, Impairment and Other Charges for
information regarding the emission allowance impairments
recorded during 2011 and 2010.
Environmental regulations including the CAIR and the
CSAPR, the timing of the installation of pollution control
equipment, fuel mix, and the level of operations, will have a
significant impact on the number of allowances required for
ongoing operations. The CAIR uses the acid rain program’s
allowances for SO2 emissions and created annual and ozone
season NOx allowances. The CSAPR, however, will not rely
upon the acid rain program, the NOx budget trading
program, or CAIR allowances for its allowance allocation
program. Instead, the EPA issued a new type of emissions
allowance for each program under the CSAPR. Any unused
SO2 allowances, annual NOx allowances, and ozone season
NOx allowances issued under CAIR cannot be used for
compliance with CSAPR. Ameren, Ameren Missouri and
Genco expect to have adequate CAIR allowances for 2012
to avoid needing to make external purchases.
Should the CSAPR become effective as issued,
Ameren, Ameren Missouri and Genco are studying their
compliance options to identify additional opportunities that
may exist for compliance in an economical fashion.
Ameren, Ameren Missouri and Genco may be required to
purchase emission allowances, if available, to install new or
optimize existing pollution control equipment, to limit
generation, or take other actions to achieve compliance with
the CSAPR in future phase-in years.
Global Climate Change
State and federal authorities, including the United
States Congress, have considered initiatives to limit
greenhouse gas emissions and to address global climate
change. Potential impacts from any climate change
legislation or regulation could vary, depending upon
proposed CO2 emission limits, the timing of implementation
of those limits, the method of distributing any allowances,
the degree to which offsets are allowed and available, and
provisions for cost-containment measures, such as a
“safety valve” provision that provides a maximum price for
emission allowances. As a result of our diverse fuel
portfolio, our emissions of greenhouse gases vary among
159
our energy centers, but coal-fired power plants are
significant sources of CO2. The enactment of a climate
change law could result in a significant rise in household
costs and rates for electricity could rise significantly. The
burden could fall particularly hard on electricity consumers
and upon the economy in the Midwest because of the
region’s reliance on electricity generated by coal-fired
power plants. Natural gas emits about half as much CO2 as
coal when burned to produce electricity. Therefore, climate
change regulation could cause the conversion of coal-fired
power plants to natural gas, or the construction of new
natural gas plants to replace coal-fired power plants. As a
result, economywide shifts to natural gas as a fuel source
for electricity generation also could affect the cost of
heating for our utility customers and many industrial
processes that use natural gas.
In December 2009, the EPA issued its “endangerment
finding” under the Clean Air Act which stated that
greenhouse gas emissions, including CO2, endanger human
health and welfare and that emissions of greenhouse gases
from motor vehicles contribute to that endangerment. In
March 2010, the EPA issued a determination that
greenhouse gas emissions from stationary sources, such as
power plants, would be subject to regulation under the
Clean Air Act effective the beginning of 2011. As a result of
these actions, we are required to consider the emissions of
greenhouse gases in any air permit application.
Recognizing the difficulties presented by regulating at
once virtually all emitters of greenhouse gases, the EPA
finalized in May 2010 regulations, known as the “Tailoring
Rule,” that established new higher thresholds for regulating
greenhouse gas emissions from stationary sources, such as
power plants. The Tailoring Rule became effective in
January 2011. The rule requires any source that already has
an operating permit to have greenhouse-gas-specific
provisions added to its permits upon renewal. Currently, all
Ameren energy centers have operating permits that, when
renewed, may be modified to address greenhouse gas
emissions. The Tailoring Rule also provides that if projects
performed at major sources result in an increase in
emissions of greenhouse gases of at least 75,000 tons per
year, measured in CO2 equivalents, such projects could
trigger permitting requirements under the NSR programs
and the application of best available control technology, if
any, to control greenhouse gas emissions. New major
sources are also required to obtain such a permit and to
install the best available control technology if their
greenhouse gas emissions exceed the applicable emissions
threshold. Separately, in December 2010, the EPA
announced a settlement agreement under which it would
propose NSPS for greenhouse gas emissions at new and
existing fossil fuel-fired power plants by July 26, 2011 and
issue a final standard by May 2012. The EPA has not yet
proposed a rule and has not specified a new estimate of
when it will issue that standard. It is uncertain whether
reductions to greenhouse gas emissions would be required
at Ameren’s, Ameren Missouri’s or Genco’s energy centers
as a result of any of the EPA’s new and future rules. Legal
challenges to the EPA’s greenhouse gas rules have been
filed. Any federal climate change legislation that is enacted
may preempt the EPA’s regulation of greenhouse gas
emissions, including the Tailoring Rule, particularly as it
relates to power plant greenhouse gas emissions. The
extent to which the Tailoring Rule could have a material
impact on our energy centers depends upon how state
agencies apply the EPA’s guidelines as to what constitutes
the best available control technology for greenhouse gas
emissions from power plants and whether physical changes
or changes in operations subject to the rule occur at our
energy centers. Although the EPA has stated its intention to
regulate greenhouse gas emissions from stationary
sources, such as power plants, congressional action could
block or delay that effort.
Future federal and state legislation or regulations that
mandate limits on the emission of greenhouse gases would
likely result in significant increases in capital expenditures
and operating costs, which, in turn, could lead to increased
liquidity needs and higher financing costs. Moreover, to the
extent Ameren Missouri requests recovery of these costs
through rates, its regulators might delay or deny timely
recovery of these costs. Excessive costs to comply with
future legislation or regulations might force Ameren,
Ameren Missouri and Genco as well as other similarly
situated electric power generators to close some coal-fired
facilities earlier than planned, which could lead to possible
impairment of assets and reduced revenues. As a result,
mandatory limits could have a material adverse impact on
Ameren’s, Ameren Missouri’s, and Genco’s results of
operations, financial position, and liquidity.
Recent federal court decisions have considered the
application of common law causes of action, such as
nuisance, to address damages resulting from global climate
change. In June 2011, the United States Supreme Court in
State of Connecticut v. American Electric Power rejected
state efforts to impose liability for CO2 and greenhouse
gases emissions under federal common law. That ruling,
however, did not address whether private citizens could
pursue causes of action based on state common law. In
June 2011, a case called Comer v. Murphy Oil (Comer) was
filed in the United States District Court for the Southern
District of Mississippi. In this litigation, a Mississippi
property owner sued several industrial companies,
including Ameren Missouri and Genco, alleging that CO2
emissions created the atmospheric conditions that
intensified Hurricane Katrina. Although we are unable to
predict the outcome of the Comer litigation on our results of
operations, financial position, and liquidity, Ameren believes
that it has meritorious defenses. Numerous procedural and
substantive challenges are expected in the Comer litigation.
The impact on us of future initiatives related to
greenhouse gas emissions and global climate change is
unknown. Compliance costs could increase as future federal
legislative, federal regulatory, and state-sponsored
initiatives to control greenhouse gases continue to
progress, making it more likely that some form of
greenhouse gas emissions control will eventually be
required. Since these initiatives continue to evolve, the
160
impact on our coal-fired energy centers and our customers’
costs is unknown, but any impact would probably be
negative. Our costs of complying with any mandated federal
or state greenhouse gas program could have a material
impact on our future results of operations, financial
position, and liquidity.
NSR and Clean Air Litigation
The EPA is engaged in an enforcement initiative to
determine whether coal-fired power plants failed to comply
with the requirements of the NSR and NSPS provisions
under the Clean Air Act when the plants implemented
modifications. The EPA’s inquiries focus on whether
projects performed at power plants should have triggered
various permitting requirements and the installation of
pollution control equipment.
In April 2005, Genco received a request from the EPA
for information pursuant to Section 114(a) of the Clean Air
Act. The request sought detailed operating and maintenance
history data with respect to Genco’s Coffeen, Hutsonville,
Meredosia, Newton, and Joppa energy centers and AERG’s
E.D. Edwards and Duck Creek energy centers. In 2006, the
EPA issued a second Section 114(a) request to Genco
regarding projects at the Newton energy center. All of these
facilities are coal-fired energy centers. In September 2008,
the EPA issued a third Section 114(a) request regarding
projects at all of Ameren’s coal-fired energy centers in
Illinois. We completed our response to the information
requests, but we are unable to predict the outcome of this
matter.
Following the issuance of a Notice of Violation, in
January 2011, the Department of Justice on behalf of the
EPA filed a complaint against Ameren Missouri in the
United States District Court for the Eastern District of
Missouri. The EPA’s complaint alleges that in performing
projects at its Rush Island coal-fired energy center, Ameren
Missouri violated provisions of the Clean Air Act and
Missouri law. In January 2012, the United States District
Court granted, in part, Ameren Missouri’s motion to
dismiss various aspects of the EPA’s penalty claims. The
EPA’s claims for injunctive relief, including to require the
installation of pollution control equipment, remain. At
present, the complaint does not include Ameren Missouri’s
other coal-fired energy centers, but the EPA has issued
Notices of Violation under its NSR enforcement initiative
against the company’s Labadie, Meramec, and Sioux coal-
fired energy centers. Litigation of this matter could take
many years to resolve. Ameren Missouri believes its
defenses to the allegations described in the complaint as
well as the Notices of Violation are meritorious. Ameren
Missouri will defend itself vigorously. However, there can
be no assurances that it will be successful in its efforts.
Ultimate resolution of these matters could have a
material adverse impact on the future results of operations,
financial position, and liquidity of Ameren, Ameren Missouri
and Genco. A resolution could result in increased capital
expenditures for the installation of pollution control
equipment, increased operations and maintenance
expenses, and penalties. We are unable to predict the
ultimate resolution of these matters or the costs that might
be incurred. However, Ameren Missouri has concluded that,
while a loss may be reasonably possible, the likelihood of
loss is not probable. Therefore, no reserve has been
established.
Clean Water Act
In March 2011, the EPA announced a proposed rule
applicable to cooling water intake structures at existing
power plants that have the ability to withdraw more than
2 million gallons of water per day from a body of water and
use at least 25 percent of that water exclusively for
cooling. Under the proposed rule, affected facilities would
be required either to meet mortality limits for aquatic life
impinged on the plant’s intake screens or to reduce intake
velocity to 0.5 feet per second. The proposed rule also
requires plants to meet site-specific entrainment standards
or to reduce the cooling water intake flow commensurate
with the intake flow of a closed-cycle cooling system. The
final rule is scheduled to be issued in July 2012, with
compliance expected within eight years thereafter. All coal-
fired, nuclear, and combined cycle energy centers at
Ameren, Ameren Missouri and Genco with cooling water
systems are subject to this proposed rule. The proposed
rule did not mandate cooling towers at existing facilities, as
other technology options potentially could meet the site-
specific standards. Ameren, Ameren Missouri and Genco
are currently evaluating the proposed rule, and their
assessment of the proposed rule’s impacts is ongoing.
Therefore, we cannot predict at this time the capital or
operating costs associated with compliance. The proposed
rule could have an adverse effect on our results of
operations, financial position, and liquidity if its
implementation requires the installation of cooling towers at
our electric generating stations.
In September 2009, the EPA announced its plan to
revise the effluent guidelines applicable to steam electric
generating units under the Clean Water Act. Effluent
guidelines are national standards for wastewater discharges
to surface water that are based on the effectiveness of
available control technology. The EPA is engaged in
information collection and analysis activities in support of
this rulemaking. It has indicated that it expects to issue a
proposed rule in July 2012 and to finalize the rule in 2014.
We are unable at this time to predict the impact of this
development.
Remediation
We are involved in a number of remediation actions to
clean up hazardous waste sites as required by federal and
state law. Such statutes require that responsible parties
fund remediation actions regardless of their degree of fault,
the legality of original disposal, or the ownership of a
disposal site. Ameren Missouri and Ameren Illinois have
each been identified by the federal or state governments as
a potentially responsible party (PRP) at several
161
contaminated sites. Several of these sites involve facilities
that were transferred by our rate-regulated utility operations
in Illinois to Genco in May 2000 and to AERG in October
2003. As part of each transfer, Ameren Illinois contractually
agreed to indemnify Genco and AERG for remediation costs
associated with preexisting environmental contamination at
the transferred sites.
As of December 31, 2011, Ameren and Ameren Illinois
owned or were otherwise responsible for 44 former MGP
sites in Illinois. These are in various stages of investigation,
evaluation, and remediation. Based on current estimated
plans, Ameren and Ameren Illinois could substantially
conclude remediation efforts at most of these sites by 2015.
The ICC permits Ameren Illinois to recover remediation and
litigation costs associated with its former MGP sites from
its electric and natural gas utility customers through
environmental adjustment rate riders. To be recoverable,
such costs must be prudently and properly incurred. Costs
are subject to annual review by the ICC.
As of December 31, 2011, Ameren and Ameren
Missouri own or are otherwise responsible for 10 MGP
sites in Missouri and one site in Iowa. Ameren Missouri
does not currently have a rate rider mechanism that permits
recovery of remediation costs associated with MGP sites
from utility customers. Ameren Missouri does not have any
retail utility operations in Iowa that would provide a source
of recovery of these remediation costs.
The following table presents, as of December 31, 2011,
the estimated probable obligation to remediate these MGP
sites.
Estimate
Low
High
Recorded
Liability(a)
Ameren . . . . . . . . . . . . . . . . . . . .
Ameren Missouri . . . . . . . . . . . . .
Ameren Illinois . . . . . . . . . . . . . . .
$
107
3
104
$
183
4
179
$
107
3
104
(a) Recorded liability represents the estimated minimum probable
obligations, as no other amount within the range provided a
better estimate.
Ameren Illinois is responsible for the cleanup of a
former coal ash landfill in Coffeen, Illinois. As of
December 31, 2011, Ameren Illinois estimated that
obligation at $0.5 million to $6 million. Ameren Illinois
recorded a liability of $0.5 million to represent its estimated
minimum obligation for this site, as no other amount within
the range was a better estimate. Ameren Illinois is also
responsible for the cleanup of a landfill, underground
storage tanks, and a water treatment plant in Illinois. As of
December 31, 2011, Ameren Illinois recorded a liability of
$0.8 million to represent its best estimate of the obligation
for these sites.
Ameren Missouri has responsibility for the
investigation and potential cleanup of two waste sites in
Missouri as a result of federal agency mandates. One of the
cleanup sites is a former coal tar distillery located in St.
Louis, Missouri. In 2008, the EPA issued an administrative
order to Ameren Missouri pertaining to this distillery
operated by Koppers Company or its predecessor and
successor companies. Ameren Missouri is the current
owner of the site, but Ameren Missouri did not conduct any
of the manufacturing operations involving coal tar or its
byproducts. Ameren Missouri, along with two other PRPs,
is currently performing a site investigation. As of
December 31, 2011, Ameren Missouri estimated its
obligation at $2 million to $5 million. Ameren Missouri has
a liability of $2 million recorded to represent its estimated
minimum obligation, as no other amount within the range
was a better estimate. Ameren Missouri’s other active
federal agency-mandated cleanup site in Missouri is a site
in Cape Girardeau. Ameren Missouri was a customer of an
electrical equipment repair and disposal company that
previously operated a facility at this site. A trust was
established in the early 1990s by several businesses and
governmental agencies to fund the cleanup of this site,
which was completed in 2005. Ameren Missouri anticipates
this trust fund will be sufficient to complete the remaining
adjacent off-site cleanup and therefore has no recorded
liability at December 31, 2011, related to this site.
Ameren Missouri also has a federal agency mandate to
complete a site investigation for a site in Illinois. In 2000,
the EPA notified Ameren Missouri and numerous other
companies, including Solutia, that former landfills and
lagoons in Sauget, Illinois, may contain soil and
groundwater contamination. These sites are known as
Sauget Area 2. From about 1926 until 1976, Ameren
Missouri operated an energy center adjacent to Sauget Area
2. Ameren Missouri currently owns a parcel of property that
was once used as a landfill. Under the terms of an
Administrative Order on Consent, Ameren Missouri has
joined with other PRPs to evaluate the extent of potential
contamination with respect to Sauget Area 2.
The Sauget Area 2 investigations overseen by the EPA
have been completed. The results have been submitted to
the EPA, and a record of decision is expected in 2012. Once
the EPA has selected a remedy, if any, it would begin
negotiations with various PRPs regarding implementation.
Over the last several years, numerous other parties have
joined the PRP group. In addition, Pharmacia Corporation
and Monsanto Company have agreed to assume the
liabilities related to Solutia’s former chemical waste landfill
in the Sauget Area 2. As of December 31, 2011, Ameren
Missouri estimated its obligation at $0.3 million to
$10 million. Ameren Missouri has a liability of $0.3 million
recorded to represent its estimated minimum obligation, as
no other amount within the range was a better estimate.
In December 2004, AERG submitted a plan to the
Illinois EPA to address groundwater and surface water
issues associated with the recycle pond, ash ponds, and
reservoir at the Duck Creek energy center. In 2010, AERG
closed the recycle pond system. Remediation work on the
recycle pond was completed in the first quarter of 2011,
and therefore no liability exists as of December 31, 2011.
Our operations or those of our predecessor companies
involve the use of, disposal of, and in appropriate
162
circumstances, the cleanup of substances regulated under
environmental protection laws. We are unable to determine
whether such practices will result in future environmental
commitments or affect our results of operations, financial
position, or liquidity.
Ash Management
There has been activity at both state and federal levels
regarding additional regulation of ash pond facilities and
CCR. In May 2010, the EPA announced proposed new
regulations regarding the regulatory framework for the
management and disposal of CCR, which could affect future
disposal and handling costs at our energy centers. Those
proposed regulations include two options for managing
CCRs under either solid or hazardous waste regulations, but
either alternative would allow for some continued beneficial
uses, such as recycling of CCR without classifying it as
waste. As part of its proposal, the EPA is considering
alternative regulatory approaches that require coal-fired
power plants either to close surface impoundments, such
as ash ponds, or to retrofit such facilities with liners.
Existing impoundments and landfills used for the disposal
of CCR would be subject to groundwater monitoring
requirements and requirements related to closure and
postclosure care under the proposed regulations.
Additionally, in January 2010, EPA announced its intent to
develop regulations establishing financial responsibility
requirements for the electric generation industry, among
other industries, and it specifically discussed CCR as a
reason for developing the new requirements. Ameren,
Ameren Missouri and Genco are currently evaluating all of
the proposed regulations to determine whether current
management of CCR, including beneficial reuse, and the use
of the ash ponds should be altered. Ameren, Ameren
Missouri and Genco also are evaluating the potential costs
associated with compliance with the proposed regulation of
CCR impoundments and landfills, which could be material,
if such regulations are adopted.
In addition, the Illinois EPA requested that Ameren,
Ameren Missouri and Genco establish groundwater
monitoring plans for their ash impoundments in Illinois.
Ameren and the Illinois EPA have established a framework for
closure of ash ponds in Illinois, including the ash ponds at
Venice, Hutsonville, and Duck Creek, when such facilities are
ultimately taken out of service. Ameren, Ameren Missouri and
Genco have recorded AROs, based on current laws, for the
estimated costs of the retirement of their ash ponds.
Pumped-storage Hydroelectric Facility Breach
In December 2005, there was a breach of the upper
reservoir at Ameren Missouri’s Taum Sauk pumped-storage
hydroelectric energy center. This resulted in significant
flooding in the local area, which damaged a state park.
Ameren Missouri settled with FERC and the state of
Missouri all issues associated with the December 2005
Taum Sauk incident. The rebuilt Taum Sauk energy center
became fully operational in April 2010.
Ameren Missouri included certain capitalized costs
associated with enhancements, or costs that would have
been incurred absent the breach, at the rebuilt Taum Sauk
energy center not recovered from property insurers in its
2010 electric rate case filing. However, in the July 2011 rate
order, the MoPSC disallowed all of these capitalized costs
associated with the rebuilding of the Taum Sauk energy
center. As a result of the order, Ameren and Ameren Missouri
each recorded a pretax charge to earnings in 2011 of
$89 million to reflect this disallowance. See Note 2 – Rate
and Regulatory Matters for additional information about the
appeal of the MoPSC’s July 2011 electric rate order.
Ameren Missouri had property and liability insurance
coverage for the Taum Sauk incident, subject to certain
limits and deductibles. Insurance did not cover some lost
electric margins or penalties paid to FERC. Ameren Missouri
believes that the total cost for cleanup, damage and
liabilities, excluding costs to rebuild the upper reservoir, is
$209 million, which is the amount Ameren Missouri had
paid as of December 31, 2011. As of December 31, 2011,
Ameren Missouri had recorded expenses of $37 million,
primarily in prior years (2011 – $1 million, 2010 –
$1 million, 2009 – $2 million), for items not covered by
insurance. Ameren Missouri recorded a $172 million
receivable for amounts recoverable from insurance
companies under liability coverage. As of December 31,
2011, Ameren Missouri had received $104 million from
insurance companies for liability claims, which reduced the
insurance receivable balance subject to liability coverage to
$68 million.
In June 2010, Ameren Missouri sued an insurance
company that was providing Ameren Missouri with liability
coverage on the date of the Taum Sauk incident. In the
litigation, filed in the United States District Court for the
Eastern District of Missouri, Ameren Missouri claimed the
insurance company breached its duty to indemnify Ameren
Missouri for the losses experienced from the incident. In
January 2011, the court ruled that the parties must first
pursue alternative dispute resolution under the terms of
their coverage agreement. In February 2011, Ameren
Missouri filed an appeal of the January ruling with the
United States Court of Appeals for the Eighth Circuit,
seeking the ability to pursue resolution of this dispute
outside of a dispute resolution process under the terms of
its coverage agreement.
Until Ameren’s remaining liability insurance claims and
the related litigation are resolved, we are unable to
determine the total impact the breach could have on
Ameren’s and Ameren Missouri’s results of operations,
financial position, and liquidity beyond those amounts
already recognized.
Asbestos-related Litigation
Ameren, Ameren Missouri, Ameren Illinois and EEI
have been named, along with numerous other parties, in a
number of lawsuits filed by plaintiffs claiming varying
degrees of injury from asbestos exposure. Most have been
163
filed in the Circuit Court of Madison County, Illinois. The
total number of defendants named in each case varies, with
as many as 272 parties named in some pending cases and
as few as two in others. In the cases pending as of
December 31, 2011, the average number of parties was 80.
The claims filed against Ameren, Ameren Missouri,
Ameren Illinois and Genco allege injury from asbestos
exposure during the plaintiffs’ activities at our present or
former electric generating plants. Former CIPS plants are
now owned by Genco, and former CILCO plants are now
owned by AERG. As a part of the transfer of ownership of
the CIPS and CILCO generating plants, CIPS and CILCO,
now Ameren Illinois, contractually agreed to indemnify
Genco and AERG, for liabilities associated with asbestos-
related claims arising from activities prior to the transfer.
Each lawsuit seeks unspecified damages that, if awarded at
trial, typically would be shared among the various
defendants.
The following table presents the pending asbestos-
related lawsuits filed against the Ameren Companies as of
December 31, 2011:
Ameren
4
Ameren
Missouri
53
Ameren
Illinois
77
Genco
Total(a)
(b)
93
(a) Total does not equal the sum of the subsidiary unit lawsuits
because some of the lawsuits name multiple Ameren entities as
defendants.
(b) As of December 31, 2011, six asbestos-related lawsuits were
pending against EEI. The general liability insurance maintained by
EEI provides coverage with respect to liabilities arising from
asbestos-related claims.
At December 31, 2011, Ameren, Ameren Missouri,
Ameren Illinois and Genco had liabilities of $18 million,
$6 million, $12 million, and $- million, respectively,
recorded to represent their best estimate of their obligations
related to asbestos claims.
Ameren Illinois has a tariff rider to recover the costs of
asbestos-related litigation claims, subject to the following
terms: 90% of cash expenditures in excess of the amount
included in base electric rates are to be recovered from a
trust fund that was established when Ameren acquired IP.
At December 31, 2011, the trust fund balance was
$23 million, including accumulated interest. If cash
expenditures are less than the amount in base rates,
Ameren Illinois will contribute 90% of the difference to the
fund. Once the trust fund is depleted, 90% of allowed cash
expenditures in excess of base rates will be recovered
through charges assessed to customers under the tariff
rider. Following the Ameren Illinois Merger, this rider is
applicable only for claims that occurred within IP’s
historical service territory. Similarly, the rider will permit
recovery only from customers within IP’s historical service
territory.
Illinois Sales and Use Tax Exemptions and Credits
In Exelon Corporation v. Department of Revenue, the
Illinois Supreme Court decided in 2009 that electricity is
tangible personal property for purposes of the Illinois
income tax investment credit. In March 2010, the United
States Supreme Court refused to hear the case, and the
decision became final. During the second quarter of 2010,
Genco and AERG began claiming Illinois sales and use tax
exemptions and credits for purchase transactions related to
their generation operations. The basis for those claims is
that the determination in the Exelon case that electricity is
tangible personal property applies to sales and use tax
manufacturing exemptions and credits. On November 2,
2011, EEI received a notice of proposed tax liability,
documenting the state of Illinois’ position that EEI did not
qualify for the manufacturing exemption it used during
2010. Genco is challenging the State of Illinois’ position. In
December 2011, EEI filed a request for review by the
Informal Conference Board of the Illinois Department of
Revenue. Ameren and Genco do not believe that it is
probable that the state of Illinois will prevail and therefore
have not recorded a charge to earnings for the loss
contingency. From the second quarter of 2010 through
December 31, 2011, Ameren and Genco claimed
manufacturing exemptions and credits of $27 million and
$19 million, respectively.
NOTE 16 – CORPORATE REORGANIZATION AND
DISCONTINUED OPERATIONS
On October 1, 2010, after receiving all necessary
approvals, Ameren, CIPS, CILCO, IP, AERG and AER
completed a two-step corporate internal reorganization. The
first step of the reorganization was the Ameren Illinois
Merger. The second step of the reorganization involved the
distribution of AERG stock from Ameren Illinois to Ameren
(the AERG distribution) and the subsequent contribution by
Ameren of the AERG stock to AER.
Upon the Ameren Illinois Merger, the debt and other
obligations of CILCO and IP under their mortgage
indentures, senior note indentures, and pollution control
bond agreements become debt and obligations of Ameren
Illinois. The property owned by CILCO and IP immediately
before the Ameren Illinois Merger that was subject to the
lien of their respective mortgage indentures remained
subject to such lien, which continued to secure the bonds
outstanding under such mortgage indenture subject to the
release and other provisions of such mortgage indenture.
The senior secured notes of IP and CILCO remained
secured by the mortgage bonds held by their respective
senior note trustee, subject to the release and other
provisions of the respective senior note indenture. The debt
and other obligations of CIPS remained debt and
obligations of Ameren Illinois. Ameren Illinois secured the
senior notes issued by CIPS with the benefit of a lien under
the IP mortgage indenture. Ameren Illinois has also
encumbered substantially all of the real estate, fixtures and
equipment owned by CIPS immediately before the Ameren
Illinois Merger with the lien of the IP mortgage indenture.
At the time of the Ameren Illinois Merger, the common
stock of CILCO and IP, all wholly owned by Ameren, was
canceled without consideration. Then, pursuant to the
164
merger agreement: (i) every two shares of each series of IP
preferred stock outstanding immediately prior to the
Ameren Illinois Merger were automatically converted into
one share of a newly created series of Ameren Illinois
preferred stock having the same payment and redemption
terms as the existing series of IP preferred stock, except to
the extent that IP preferred stockholders exercised their
dissenters’ rights in accordance with Illinois law; and
(ii) each outstanding share of CIPS common and preferred
stock remained outstanding, except to the extent that CIPS
preferred stockholders exercised their dissenters’ rights in
accordance with Illinois law. Stockholders holding
approximately 8,337 shares and 423 shares of CIPS and IP
preferred stock, respectively, exercised their dissenters’
rights.
In its application for the FERC orders approving the
Ameren Illinois Merger and the AERG distribution, Ameren
committed to maintain a minimum 30% equity capital
structure at Ameren Illinois after the Ameren Illinois Merger
and the AERG distribution.
Ameren Illinois determined that the operating results of
AERG qualified for discontinued operations presentation;
therefore, Ameren Illinois segregated AERG’s operating
results and presented them separately as discontinued
operations for all periods presented prior to October 1,
2010, in this report. For Ameren’s financial statements,
AERG’s results of operation remain classified as continuing
operations. The following table summarizes the operating
results of Ameren Illinois’ former merchant generation
subsidiary, AERG, classified as discontinued operations in
Ameren Illinois’ statements of income for the years ended
December 31, 2010, and 2009:
2010
2009
$
Operating revenues . . . . . . . . . . . . .
Operating expenses . . . . . . . . . . . . .
Operating income . . . . . . . . . . . . . .
Other income . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . .
Income taxes . . . . . . . . . . . . . . . . . .
274
201
73
1
14
20
Income from discontinued
$
427
233
194
-
16
64
operations, net of tax . . . . . . . . .
$
40
$
114
NOTE 17 – GOODWILL, IMPAIRMENT AND OTHER CHARGES
The following table summarizes the pretax charges recognized for the years ended December 31, 2011, 2010, and 2009:
Long-Lived
Assets and Related
Charges
Goodwill
Emission
Allowances
Total
2011:
Ameren(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
2010:
Ameren(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009:
Ameren(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
-
-
-
420
65
-
-
$
123
89
34
101
64
7
6
$
2
-
1
68
41
-
-
$
125
89
35
589
170
7
6
(a)
Includes amounts for registrant and nonregistrant subsidiaries.
Each of the above charges was recorded in the
statement of income as “Goodwill, impairment and other
charges,” with the exception of the Ameren Missouri
statement of income where it was recorded as “Loss from
regulatory disallowance.” Each of the charges is discussed
below.
The goodwill and other asset impairment charges did
not result in a violation of any Ameren or Ameren subsidiary
debt covenants or counterparty agreements. The charges
are not expected to have a material impact on future
operations.
Goodwill
Ameren has three reporting units, which also represent
Ameren’s reportable segments. The Ameren reporting units
are Ameren Missouri, Ameren Illinois, and Merchant
Generation. Genco has one reporting unit, Merchant
Generation. Ameren Illinois has one reporting unit, Ameren
Illinois. Ameren’s reporting units have been defined and
goodwill has been evaluated at the operating segment level
in accordance with authoritative accounting guidance. Our
reporting units represent businesses for which discrete
financial information is available and reviewed regularly by
management.
We evaluate goodwill for impairment as of October 31
of each year, or more frequently if events and
circumstances indicate that the asset might be impaired. In
2011, FASB amended its guidance to simplify the testing of
goodwill for impairment. The amended guidance provides
an option to perform a qualitative assessment to determine
whether further impairment testing is necessary. If the
qualitative evaluation yields support that it is more likely
than not that the fair value of a reporting unit exceeds its
165
carrying value, the quantitative impairment test is not
required. Ameren and Ameren Illinois adopted the
qualitative goodwill evaluation model for its annual goodwill
impairment test conducted as of October 31, 2011. Based
on the results of Ameren’s and Ameren Illinois’ qualitative
assessment, Ameren and Ameren Illinois believe it was
more likely than not that the fair value of each of their
reporting units exceeded their carrying values as of
October 31, 2011, indicating no impairment of Ameren’s
and Ameren Illinois’ goodwill. The following factors, not
meant to be all-inclusive, were considered by Ameren and
Ameren Illinois when assessing whether it was more likely
than not that the fair value of the Ameren Illinois reporting
unit exceeded its carrying value for the October 31, 2011
test:
‰ Macroeconomic conditions, including those conditions
‰
‰
within Ameren Illinois’ service territory;
Pending rate case outcomes and future rate case
outcomes;
Changes in laws and potential law changes, such as the
IEIMA;
‰
‰
Observable industry market multiples; and
Actual and forecasted financial performance.
During 2010, Ameren recorded a noncash impairment
charge of $420 million, which represented all of the
goodwill assigned to Ameren’s Merchant Generation
reporting unit. Genco recorded a noncash impairment
charge of $65 million, which represented all the goodwill
assigned to Genco’s Merchant Generation reporting unit.
The impairments recorded in 2010 in the Merchant
Generation segment were caused by a sustained decline in
market prices for electricity, industry market multiples
becoming observable at lower levels than previously
estimated, and potentially more stringent environmental
regulations being enacted.
Ameren and Ameren Illinois will continue to monitor
the actual and forecasted operating results, cash flows,
market capitalization, and observable industry market
multiples of their reporting units for signs of possible
declines in estimated fair value and potential goodwill
impairment.
The following tables provide a reconciliation of the beginning and ending carrying amounts of goodwill by reporting unit,
for Ameren, Ameren Illinois and Genco for the years ended December 31, 2011 and 2010:
Ameren
Gross goodwill at January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated impairment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, net of accumulated impairment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment losses during year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, net of impairment losses at December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(a)
Includes amounts for Ameren registrants and nonregistrant subsidiaries.
Ameren Illinois
2011
Ameren
Illinois
$ 411
-
$ 411
-
$ 411
2010
Ameren
Illinois
Merchant
Generation
$ 411
-
$ 411
-
$ 411
$ 420
-
$ 420
420
$
-
Total(a)
$ 831
-
$ 831
420
$ 411
Gross goodwill at January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated impairment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, net of accumulated impairment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment losses during the year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, net of impairment losses at December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Genco
2011
2010
Ameren
Illinois
Ameren
Illinois
$ 411
-
$ 411
-
$ 411
$ 411
-
$ 411
-
$ 411
2010
Merchant Generation
Gross goodwill at January 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accumulated impairment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, net of accumulated impairment losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Impairment losses during the year
Goodwill, net of impairment losses at December 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 65
-
$ 65
65
$
-
166
Long-lived Assets
We evaluate long-lived assets classified as held and
used for impairment when events or changes in
circumstances indicate that the carrying value of such
assets may not be recoverable. Whether impairment has
occurred is determined by comparing the estimated
undiscounted cash flows attributable to the assets with the
carrying value of the assets. If the carrying value exceeds
the undiscounted cash flows, we recognize an impairment
charge equal to the carrying value of the assets in excess of
estimated fair value.
During 2011, the MoPSC issued an electric rate order
that disallowed the recovery of all costs of enhancements,
or costs that would have been incurred absent the breach,
related to the rebuilding of the Taum Sauk energy center in
excess of the amount recovered from property insurance.
Consequently, Ameren and Ameren Missouri each reported
a pretax charge to earnings of $89 million. See Note 2 –
Rate and Regulatory Matters for additional information.
At the end of 2011, Genco ceased operations of its
Meredosia and Hutsonville energy centers. The closure of
these energy centers resulted in the elimination of 90
positions. Ameren and Genco each recorded the following
pretax charges to earnings during 2011 related to the
closure of these energy centers:
‰
‰
‰
a $26 million noncash impairment, representing the
remaining net investment in both energy centers;
a $4 million noncash impairment of materials and
supplies; and
a $4 million estimate for future cash severance costs,
which will be substantially paid during the first quarter
of 2012.
The closure of these energy centers is primarily the
result of the expected cost of complying with the CSAPR
and the MATS. Genco determined that environmental
compliance options for these four units were uneconomical.
Another factor driving the closure of these energy centers
was a lack of a multiyear capacity market managed by
MISO, without which Genco was not positioned to make the
substantial investment for environmental controls that
would be required to keep these units in service. Ameren
and Genco expect to receive cash tax benefits of $22 million
and $33 million, respectively, as a result of the closure of
these energy centers. Previously recorded AROs for ash
pond closures, river structure, and asbestos removals at
these energy centers were $38 million. Ameren and Genco
expect cash expenditures over the next 10 years along with
associated cash tax benefits of $16 million.
During 2010, Ameren and Genco evaluated their long-
lived assets and recorded noncash pretax asset impairment
charges of $101 million and $64 million, respectively, to
reduce the carrying value of the Meredosia and Medina
Valley energy centers to their estimated fair value during
2010.
In 2009, Genco recorded asset impairment charges of
$6 million as a result of the termination of a rail line
extension project at a Genco subsidiary and an adjustment
of the carrying value of an office building owned by Genco
to its estimated fair value as of December 31, 2009. The
charge related to the office building was based on the net
proceeds from its sale in 2010. In addition, AERG recorded
an asset impairment charge of $1 million to adjust the
carrying value of its Indian Trails generation facility’s
estimated fair value as of December 31, 2009. This charge
was based on the net proceeds from the sale of the facility
in January 2010.
Intangible Assets
We evaluate emission allowances for impairment if
events or changes in circumstances indicate that they will
not or cannot be used in operations.
Prior to 2010, Ameren, Ameren Missouri and Genco
expected to use their SO2 emission allowances for ongoing
operations. In July 2010, the EPA issued the proposed
CSAPR, which would restrict the use of existing SO2
emission allowances. As a result, Ameren, Ameren Missouri
and Genco no longer expected all of their SO2 emission
allowances would be used in operations. Therefore, during
2010, Ameren, Ameren Missouri and Genco recorded an
impairment charge to reduce the carrying value of their SO2
emission allowances to their estimated fair value. Ameren’s
and Genco’s noncash pretax impairment charge was
$68 million and $41 million, respectively. Ameren Missouri
recorded a $23 million impairment of its SO2 emission
allowances by reducing a previously established regulatory
liability relating to SO2 emission allowances. Therefore, the
Ameren Missouri SO2 emission allowance impairment had
no impact on earnings. The fair value of the SO2 emission
allowances was based on observable and unobservable
inputs.
In July 2011, the EPA issued CSAPR, which created
new allowances for SO2 and NOx emissions, and restricted
the use of pre-existing SO2 and NOx allowances to the acid
rain program and to the NOx budget trading program,
respectively. As a result, observable market prices for
existing emission allowances declined materially.
Consequently, during 2011, Ameren and Genco recorded a
noncash pretax impairment charge of $2 million and
$1 million, respectively. Ameren Missouri recorded a
$1 million impairment of its SO2 emission allowances by
reducing a previously established regulatory liability relating
to the SO2 emission allowances, which had no impact on
earnings.
NOTE 18 – SEGMENT INFORMATION
Ameren has three reportable segments: Ameren
Missouri, Ameren Illinois, and Merchant Generation. The
Ameren Missouri segment for Ameren and Ameren
Missouri includes all the operations of Ameren Missouri’s
business as described in Note 1 – Summary of Significant
Accounting Policies. The Ameren Illinois segment for
Ameren and Ameren Illinois consists of all of the operations
of Ameren Illinois as described in Note 1 – Summary of
Significant Accounting Policies. The Merchant Generation
167
segment for Ameren consists primarily of the operations or
activities of Genco, including EEI, AERG, Medina Valley and
Marketing Company. The category called Other primarily
includes Ameren parent company activities, Ameren
Services, and ATXI.
The following table presents information about the reported revenues and specified items reflected in Ameren’s net
income for the years ended December 31, 2011, 2010, and 2009, and total assets as of December 31, 2011, 2010, and 2009.
Ameren
Ameren
Illinois
Regulated
Segment
Ameren
Missouri
Merchant
Generation
Other
Intersegment
Eliminations
Consolidated
2011:
External revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . .
Interest and dividend income . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to Ameren Corporation(a)
. . . .
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010:
External revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . .
Interest and dividend income . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to Ameren Corporation(a)
. . . .
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009:
External revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Intersegment revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Depreciation and amortization . . . . . . . . . . . . . . . . . . . . . . . .
Interest and dividend income . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income taxes (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income (loss) attributable to Ameren Corporation(a)
. . . .
Capital expenditures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
$
$
3,358
25
408
30
209
161
287
550
12,757
3,176
21
382
31
213
199
364
624
12,504
2,847
27
357
29
229
128
259
882
12,219
$
$
$
2,774
13
215
1
136
127
193
351
7,213
3,002
12
210
1
143
137
208
281
7,406
2,957
27
216
6
153
79
127
352
7,181
$
$
$
1,394
235
143
-
105
32
45
153
3,833
1,459
234
146
1
133
6
(409)
101
3,934
1,322
390
126
-
119
151
247
408
4,751
$
5
4
19
44
44
(10)
(6)
(24)(b)
1,211
$
$
1
13
27
25
35
(17)
(24)
36
1,354
9
19
26
33
48
(26)
(21)
68
1,814
$
$
$
-
(277)
-
(43)
(43)
-
-
-
(1,369)
-
(280)
-
(25)
(27)
-
-
-
(1,687)
-
(463)
-
(38)
(41)
-
-
-
(2,263)
$
$
$
7,531
-
785
32
451
310
519
1,030
23,645
7,638
-
765
33
497
325
139
1,042
23,511
7,135
-
725
30
508
332
612
1,710
23,702
(a) Represents net income (loss) available to common stockholders.
(b)
Includes the elimination of intercompany transfers.
SELECTED QUARTERLY INFORMATION (Unaudited) (In millions, except per share amounts)
Quarter Ended(a)
Ameren
March 31, 2011 . . . . . . . . . . . . . . . . . . .
March 31, 2010 . . . . . . . . . . . . . . . . . . .
June 30, 2011 . . . . . . . . . . . . . . . . . . . .
June 30, 2010 . . . . . . . . . . . . . . . . . . . .
September 30, 2011 . . . . . . . . . . . . . . .
September 30, 2010 . . . . . . . . . . . . . . .
December 31, 2011 . . . . . . . . . . . . . . . .
December 31, 2010 . . . . . . . . . . . . . . . .
Operating
Revenues
Operating
Income
Net Income (Loss)
Attributable to
Ameren Corporation
Earnings (Loss) per
Common
Share – Basic and
Diluted
$
1,904
1,940
1,781
1,725
2,268
2,267
1,578
1,706
$
227
298
316
331
550
89
148
198
$
71
102
138
152
285
(167)
25
52
$
0.29
0.43
0.57
0.64
1.18
(0.70)
0.10
0.21
(a) The sum of quarterly amounts, including per share amounts, may not equal amounts reported for year-to-date periods. This is due to the
effects of rounding and changes in the number of weighted-average shares outstanding each period.
168
$ 21
27
90
113
190
223
(14)
1
Net Income
Available
to Common
Stockholder
$
33
47
37
55
98
109
25
37
Quarter Ended
Ameren Missouri
March 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . .
June 30, 2011 . . . . . . . . . . . . . . . . . . . . . . . . .
June 30, 2010 . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2011 . . . . . . . . . . . . . . . . . . . .
September 30, 2010 . . . . . . . . . . . . . . . . . . . .
December 31, 2011 . . . . . . . . . . . . . . . . . . . . .
December 31, 2010 . . . . . . . . . . . . . . . . . . . . .
Quarter Ended
Ameren Illinois
Operating
Revenues
Operating
Income
Net Income
(Loss)
Net Income (Loss)
Available
to Common
Stockholder
$ 772
682
822
761
1,115
1,060
674
694
$ 77
90
176
197
333
385
23
39
$ 22
28
91
115
191
224
(14)
2
Operating
Revenues
Operating
Income
Income from
Continuing
Operations
Net Income
March 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
June 30, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
June 30, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2011 . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2010 . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . .
808
911
623
647
745
746
611
710
$
88
98
99
112
196
182
75
106
$
34
36
38
48
98
91
26
37
$
34
48
38
57
98
110
26
37
Quarter Ended
Genco
Operating
Revenues
Operating
Income (Loss)
Net Income (Loss)
Net Income (Loss)
Attributable to
Ameren Energy
Generating Company
March 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
March 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$
June 30, 2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
June 30, 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2011 . . . . . . . . . . . . . . . . . . . . . . . .
September 30, 2010 . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2011 . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2010 . . . . . . . . . . . . . . . . . . . . . . . . .
241
266
260
275
327
335
238
250
$
54
62
37
45
10
(99)
38
54
$
22
24
13
14
(4)
(100)
14
26
$
21
23
13
13
(5)
(101)
15
26
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.
None.
ITEM 9A. CONTROLS AND PROCEDURES.
Each of the Ameren Companies was required to comply with Section 404 of the Sarbanes-Oxley Act of 2002 and related
SEC regulations as to management’s assessment of internal control over financial reporting for the 2011 fiscal year.
(a) Evaluation of Disclosure Controls and Procedures
As of December 31, 2011, evaluations were performed under the supervision and with the participation of management,
including the principal executive officer and principal financial officer of each of the Ameren Companies, of the effectiveness of
the design and operation of such registrant’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
of the Exchange Act). Based on those evaluations, as of December 31, 2011, the principal executive officer and principal
financial officer of each of the Ameren Companies concluded that such disclosure controls and procedures are effective to
provide assurance that information required to be disclosed in such registrant’s reports filed or submitted under the Exchange
Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and such
information is accumulated and communicated to its management, including its principal executive and principal financial
officers, to allow timely decisions regarding required disclosure.
169
(b) Management’s Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting, as such
term is defined in Exchange Act Rules 13a-15(f) and 15d-15(f). Under the supervision of and with the participation of
management, including the principal executive officer and principal financial officer, an evaluation was conducted of the
effectiveness of each of the Ameren Companies’ internal control over financial reporting based on the framework in Internal
Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
After making that evaluation, management concluded that each of the Ameren Companies’ internal control over financial
reporting was effective as of December 31, 2011. The effectiveness of Ameren’s internal control over financial reporting as of
December 31, 2011, has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as
stated in its report herein under Part II, Item 8. This annual report does not include an attestation report of Ameren Missouri’s,
Ameren Illinois’ or Genco’s (the Subsidiary Registrants) independent registered public accounting firm regarding internal
control over financial reporting. Management’s report for each of the Subsidiary Registrants is not subject to attestation by the
independent registered public accounting firm.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also,
projections of any evaluation of effectiveness into future periods are subject to the risk that internal controls might become
inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures might
deteriorate.
(c) Change in Internal Control
There has been no change in the Ameren Companies’ internal control over financial reporting during their most recent
fiscal quarter that has materially affected, or is reasonably likely to materially affect, their internal control over financial
reporting.
ITEM 9B. OTHER INFORMATION.
The Ameren Companies have no information reportable under this item that was required to be disclosed in a report on
SEC Form 8-K during the fourth quarter of 2011 that has not previously been reported on an SEC Form 8-K.
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE.
PART III
Information required by Items 401, 405, 406 and
407(c)(3),(d)(4) and (d)(5) of SEC Regulation S-K for
Ameren will be included in its definitive proxy statement for
its 2012 annual meeting of shareholders filed pursuant to
SEC Regulation 14A; it is incorporated herein by reference.
Information required by these SEC Regulation S-K items for
Ameren Missouri and Ameren Illinois will be included in
each company’s definitive information statement for its
2012 annual meeting of shareholders filed pursuant to SEC
Regulation 14C; it is incorporated herein by reference.
Specifically, reference is made to the following sections of
Ameren’s definitive proxy statement and each of Ameren
Missouri’s and Ameren Illinois’ definitive information
statement: “Information Concerning Nominees to the Board
of Directors,” “Section 16(a) Beneficial Ownership
Reporting Compliance,” “Corporate Governance” and
“Board Structure.” With respect to Genco, this information
is omitted in reliance on General Instruction I(2) of Form
10-K.
Information concerning executive officers of the
Ameren Companies required by Item 401 of SEC Regulation
S-K is reported under a separate caption entitled “Executive
Officers of the Registrants” in Part I of this report.
Ameren Missouri, Ameren Illinois and Genco do not
have separately designated standing audit committees, but
instead use Ameren’s audit and risk committee to perform
such committee functions for their boards of directors.
These companies have no securities listed on the NYSE and
therefore are not subject to the NYSE listing standards.
Walter J. Galvin serves as chairman of Ameren’s audit and
risk committee, and Stephen F. Brauer, Catherine S. Brune
and Ellen M. Fitzsimmons serve as members. The board of
directors of Ameren has determined that Walter J. Galvin
qualifies as an audit committee financial expert and that he
is “independent” as that term is used in SEC Regulation
14A.
Also, on the same basis as reported above, the boards
of directors of Ameren Missouri, Ameren Illinois and Genco
use the nominating and corporate governance committee of
Ameren’s board of directors to perform such committee
functions. This committee is responsible for the nomination
of directors and corporate governance practices. Ameren’s
nominating and corporate governance committee will
consider director nominations from stockholders in
accordance with its Policy Regarding Nominations of
Directors, which can be found on Ameren’s website:
www.ameren.com.
To encourage ethical conduct in its financial
management and reporting, Ameren has adopted a Code of
Ethics that applies to the principal executive officer, the
president, the principal financial officer, the principal
accounting officer, the controller, and the treasurer of each
170
of the Ameren Companies. Ameren has also adopted a Code
of Business Conduct that applies to the directors, officers,
and employees of the Ameren Companies. It is referred to
as the Corporate Compliance Policy. The Ameren
Companies make available free of charge through Ameren’s
website (www.ameren.com) the Code of Ethics and
Corporate Compliance Policy. Any amendment to the Code
of Ethics and Corporate Compliance Policy and any waiver
ITEM 11. EXECUTIVE COMPENSATION.
from a provision of the Code of Ethics and Corporate
Compliance Policy as it relates to the principal executive
officer, the president, the principal financial officer, the
principal accounting officer, the controller and the treasurer
of each of the Ameren Companies will be posted on
Ameren’s website within four business days following the
date of the amendment or waiver.
Information required by Items 402 and 407(e)(4) and (e)(5) of SEC Regulation S-K for Ameren will be included in its
definitive proxy statement for its 2012 annual meeting of shareholders filed pursuant to SEC Regulation 14A; it is incorporated
herein by reference. Information required by these SEC Regulation S-K items for Ameren Missouri and Ameren Illinois will be
included in each company’s definitive information statement for its 2012 annual meeting of shareholders filed pursuant to SEC
Regulation 14C; it is incorporated herein by reference. Specifically, reference is made to the following sections of Ameren’s
definitive proxy statement and each of Ameren Missouri’s and Ameren Illinois’ definitive information statement: “Executive
Compensation,” and “Human Resources Committee Interlocks and Insider Participation.” With respect to Genco, this
information is omitted in reliance on General Instruction I(2) of Form 10-K.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS.
Equity Compensation Plan Information
The following table presents information as of December 31, 2011, with respect to the shares of Ameren’s common stock
that may be issued under its existing equity compensation plans.
Plan
Category
Number of Securities to be
Issued Upon Exercise of
Outstanding Options,
Warrants and Rights
(a)
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(b)
Number of Securities Remaining
Available for Future Issuance Under
Equity Compensation Plans (excluding
securities reflected in column (a))
(c)
Equity compensation plans approved by security
holders(a)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,744,825
Equity compensation plans not approved by
security holders . . . . . . . . . . . . . . . . . . . . . . . . . .
-
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,744,825
$
(b)
-
$
(b)
1,877,523
-
1,877,523
(a) Consists of the Ameren Corporation Long-term Incentive Plan of 1998, which was approved by stockholders in April 1998 and expired on
April 1, 2008, and the Ameren Corporation 2006 Omnibus Incentive Compensation Plan, which was approved by stockholders in May 2006 and
expires on May 2, 2016. Pursuant to grants of performance share units (PSUs) under the Long-term Incentive Plan of 1998 and the 2006
Omnibus Incentive Compensation Plan, 211,940 of the securities represent PSUs that vested as of December 31, 2011 (including accrued and
reinvested dividends), and 1,496,153 of the securities represent target PSUs granted but not vested (including accrued and reinvested
dividends) as of December 31, 2011. The actual number of shares issued in respect of the PSUs will vary from 0% to 200% of the target level
depending upon the achievement of total stockholder return objectives established for such awards. For additional information about the PSUs,
including payout calculations, see “Compensation Discussion and Analysis – Long-Term Incentives: Performance Share Unit Program (PSUP)”
in Ameren’s definitive proxy statement for its 2012 annual meeting of stockholders held pursuant to SEC Regulation 14A. 36,732 of the
securities represent shares that may be issued as of December 31, 2011, to satisfy obligations under the Ameren Corporation Deferred
Compensation Plan for members of the board of directors.
(b) Earned PSUs and deferred compensation stock units are paid in shares of Ameren common stock on a one-for-one basis. Accordingly, the
PSUs and deferred compensation stock units have been excluded for purposes of calculating the weighted-average exercise price.
Ameren Missouri, Ameren Illinois and Genco do not have separate equity compensation plans.
Security Ownership of Certain Beneficial Owners and Management
The information required by Item 403 of SEC Regulation S-K for Ameren will be included in its definitive proxy statement
for its 2012 annual meeting of stockholders filed pursuant to SEC Regulation 14A; it is incorporated herein by reference.
Information required by this SEC Regulation S-K item for Ameren Missouri and Ameren Illinois will be included in each
company’s definitive information statement for its 2012 annual meeting of stockholders filed pursuant to SEC Regulation 14C;
it is incorporated herein by reference. Specifically, reference is made to the following section of Ameren’s definitive proxy
statement and each of Ameren Missouri’s and Ameren Illinois’ stockholders definitive information statement: “Security
Ownership.” With respect to Genco, this information is omitted in reliance on General Instruction I(2) of Form 10-K.
171
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE.
Information required by Item 404 and Item 407(a) of SEC Regulation S-K for Ameren will be included in its definitive
proxy statement for its 2012 annual meeting of stockholders filed pursuant to SEC Regulation 14A; it is incorporated herein by
reference. Information required by Item 404 of SEC Regulation S-K for Ameren Missouri and Ameren Illinois will be included in
each company’s definitive information statement for its 2012 annual meeting of stockholders filed pursuant to SEC
Regulation 14C; it is incorporated herein by reference. Specifically, reference is made to the following sections of Ameren’s
definitive proxy statement and each of Ameren Missouri’s and Ameren Illinois’ definitive information statement: “Policy and
Procedures With Respect to Related Person Transactions” and “Director Independence.” With respect to Genco, this
information is omitted in reliance on General Instruction I(2) of Form 10-K.
ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES.
Information required by Item 9(e) of SEC Schedule 14A for the Ameren Companies will be included in the definitive proxy
statement of Ameren and the definitive information statements of Ameren Missouri and Ameren Illinois for their 2012 annual
meetings of stockholders filed pursuant to SEC Regulations 14A and 14C, respectively; it is incorporated herein by reference.
Information required by this Item of Form 10-K for Genco is identical to the information that will be included in Ameren’s
definitive proxy statement and in the definitive information statements of Ameren Missouri and Ameren Illinois for their 2012
annual meetings of stockholders filed pursuant to SEC Regulations 14A and 14C, respectively; it is incorporated herein by
reference. Specifically, reference is made to the following section of Ameren’s definitive proxy statement and each of Ameren
Missouri’s and Ameren Illinois’ definitive information statement: “Independent Registered Public Accounting Firm.”
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
PART IV
(a)(1) Financial Statements
Ameren
Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Income – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Balance Sheet – December 31, 2011 and 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Cash Flows – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Stockholders’ Equity – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . .
Union Electric Company
Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Statement of Income – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Balance Sheet – December 31, 2011 and 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Statement of Cash Flows – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Statement of Stockholders’ Equity – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois
Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Income – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Balance Sheet – December 31, 2011 and 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Cash Flows – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Stockholders’ Equity – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . .
Genco
Report of Independent Registered Public Accounting Firm . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Income – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Balance Sheet – December 31, 2011 and 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Cash Flows – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Consolidated Statement of Stockholder’s Equity – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . .
(a)(2) Financial Statement Schedules
Report of Independent Registered Public Accounting Firm on Financial Statement Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule I – Condensed Financial Information of Parent – Ameren:
Condensed Statement of Income – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Condensed Balance Sheet – December 31, 2011 and 2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Condensed Statement of Cash Flows – Years Ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Schedule II – Valuation and Qualifying Accounts for the years ended December 31, 2011, 2010, and 2009 . . . . . . . . . . . . . . . . . . . .
Page No.
79
81
82
83
84
79
85
86
87
88
80
89
90
91
92
80
93
94
95
96
173
174
174
174
176
Schedule I and II should be read in conjunction with the aforementioned financial statements. Certain schedules have
been omitted because they are not applicable or because the required data is shown in the aforementioned financial
statements.
(a)(3)
(b)
Exhibits.
Reference is made to the Exhibit Index commencing on page 181.
Exhibits are listed in the Exhibit Index commencing on page 181.
172
Report of Independent Registered Public Accounting Firm on Financial Statement Schedules
To the Board of Directors and Shareholders
of Ameren Corporation:
Our audits of the consolidated financial statements listed in the index appearing under Item 15(a)(1) and of the effectiveness of
internal control over financial reporting referred to in our report dated February 28, 2012 also included an audit of the financial
statement schedules listed in Item 15(a)(2) of this Form 10-K. In our opinion, these financial statement schedules present
fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial
statements.
As disclosed in Note 6 to Schedule I, the Company has restated its Parent Company only condensed statement of cash flows
included on Schedule I for the years ended December 31, 2010 and December 31, 2009.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
Report of Independent Registered Public Accounting Firm on Financial Statement Schedules
To the Board of Directors and Shareholders
of Union Electric Company:
Our audits of the financial statements listed in the index appearing under Item 15(a)(1) referred to in our report dated
February 28, 2012 also included an audit of the financial statement schedule listed in Item 15(a)(2) of this Form 10-K. In our
opinion, this financial statement schedule presents fairly, in all material respects, the information set forth therein when read in
conjunction with the related financial statements.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
Report of Independent Registered Public Accounting Firm on Financial Statement Schedules
To the Board of Directors and Shareholders
of Ameren Illinois Company:
Our audits of the consolidated financial statements listed in the index appearing under Item 15(a)(1) referred to in our report
dated February 28, 2012 also included an audit of the financial statement schedule listed in Item 15(a)(2) of this Form 10-K. In
our opinion, this financial statement schedule presents fairly, in all material respects, the information set forth therein when
read in conjunction with the related consolidated financial statements.
/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP
St. Louis, Missouri
February 28, 2012
173
SCHEDULE I – CONDENSED FINANCIAL INFORMATION OF PARENT
AMEREN CORPORATION
CONDENSED STATEMENT OF INCOME
For the Years Ended December 31, 2011, 2010 and 2009
(In millions)
Operating revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Goodwill, impairment and other charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Operating loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Equity in earnings of subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest income from affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Miscellaneous expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Interest charges . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Income tax (benefit) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2011
2010
2009
$
$
-
-
15
(15)
527
44
4
41
(8)
519
$
$
-
372
24
(396)
535
28
3
56
(31)
139
$
$
-
-
20
(20)
625
36
4
37
(12)
612
SCHEDULE I – CONDENSED FINANCIAL INFORMATION OF PARENT
AMEREN CORPORATION
CONDENSED BALANCE SHEET
(In millions)
Assets:
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Advances to money pool . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts and notes receivable – affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments in subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Note receivable – affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Liabilities and Stockholders’ Equity:
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term debt
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable – affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total current liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Credit facility borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Long-term debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other deferred credits and liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Commitments and Contingencies
Stockholders’ Equity:
Common stock, $.01 par value, 400.0 shares authorized shares outstanding
of 242.6 and 240.4, respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other paid-in capital, principally premium on common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total liabilities and stockholders’ equity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
December 31, 2011
December 31, 2010
$
$
$
$
3
340
57
-
400
7,532
425
333
8,690
148
13
62
223
-
424
74
721
2
5,598
2,369
7,969
8,690
$
$
$
$
4
64
405
2
475
7,681
425
403
8,984
269
41
75
385
360
423
69
1,237
2
5,520
2,225
7,747
8,984
SCHEDULE I – CONDENSED FINANCIAL INFORMATION OF PARENT
AMEREN CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
For the Years Ended December 31, 2011, 2010 and 2009
(In millions)
Net cash flows provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash flows from investing activities:
Money pool advances, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Notes receivable – affiliates, net
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Investments in subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash flows provided by (used in) investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash flows from financing activities:
Dividends on common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Short-term debt and credit facility borrowings, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Issuances of:
Long-term debt
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Other . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Net cash flows provided by (used in) financing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2011
Restated 2010
Restated 2009
$
804
$
241
$
270
(276)
358
(94)
(2)
(14)
(375)
(481)
-
65
-
(791)
18
242
(13)
1
248
(368)
(221)
-
80
-
(509)
300
(712)
(831)
-
(1,243)
(338)
275
423
634
(19)
975
174
SCHEDULE I – CONDENSED FINANCIAL INFORMATION OF PARENT
AMEREN CORPORATION
CONDENSED STATEMENT OF CASH FLOWS
For the Years Ended December 31, 2011, 2010 and 2009
(In millions)
Net change in cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash and cash equivalents at beginning of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash and cash equivalents at the end of year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Cash dividends received from consolidated subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2011
Restated 2010
Restated 2009
$
$
$
(1)
4
3
730
$
$
$
(20)
24
4
368
$
$
$
2
22
24
338
AMEREN CORPORATION (parent company only)
NOTES TO CONDENSED FINANCIAL STATEMENTS
December 31, 2011
NOTE 1 – BASIS OF PRESENTATION
Ameren Corporation (parent company only) is a public utility holding company that conducts substantially all of its
business operations through its subsidiaries. As specified in Note 5 – Long-term Debt and Equity Financings under Part II,
Item 8, of this report, there are restrictions on Ameren Corporation’s (parent company only) ability to obtain funds from
certain of its subsidiaries through dividends, loans or advances. In accordance with authoritative accounting guidance, Ameren
Corporation (parent company only) has accounted for wholly owned subsidiaries using the equity method. These financial
statements are presented on a condensed basis. Additional disclosures relating to the parent company financial statements are
included within the combined notes under Part II, Item 8, of this report.
NOTE 2 – SHORT-TERM DEBT AND LIQUIDITY
See Note 4 – Short-term Debt and Liquidity under Part II, Item 8, of this report for a description and details of short-term
debt and liquidity needs of Ameren Corporation (parent company only).
NOTE 3 – LONG-TERM OBLIGATIONS
See Note 5 – Long-term Debt and Equity Financings under Part II, Item 8, of this report for a description and details of
long-term obligations of Ameren Corporation (parent company only).
NOTE 4 – COMMITMENTS AND CONTINGENCIES
See Note 15 – Commitments and Contingencies under Part II Item 8, of this report for a description of all material
contingencies and guarantees outstanding of Ameren Corporation (parent company only).
NOTE 5 – GOODWILL AND OTHER ASSET IMPAIRMENTS
See Note 17 – Goodwill, Impairments and Other Charges under Part II, Item 8, of this report for a description of the
impairment charges incurred by Ameren Corporation (parent company only) in 2010.
NOTE 6 – RESTATEMENTS
During 2011, Ameren Corporation (parent company only) identified an error in the cash flow statement classification of
intercompany notes receivable that impacted years ended December 31, 2010, and 2009. For the year ended December 31, 2010,
previously reported cash flows provided by operating activities were $522 million and cash flows used in investing activities were
$33 million. As corrected herein, cash flows provided by operating activities were $241 million and cash flows provided by
investing activities were $248 million. For the year ended December 31, 2009, previously reported cash flows used in operating
activities were $442 million and cash flows used in investing activities were $531 million. As corrected herein, cash flows provided
by operating activities were $270 million and cash flows used in investing activities were $1,243 million.
175
(in millions)
Column A
Column B
Column C
Column D
Column E
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS
FOR THE YEARS ENDED DECEMBER 31, 2011, 2010 AND 2009
Description
Ameren:
Deducted from assets – allowance for doubtful accounts:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Missouri:
Deducted from assets – allowance for doubtful accounts:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Ameren Illinois:
Deducted from assets – allowance for doubtful accounts:
2011 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2010 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(a) Uncollectible accounts charged off, less recoveries.
Balance at
Beginning
of Period
(1)
Charged to Costs
and Expenses
(2)
Charged to Other
Accounts
Deductions(a)
Balance at End
of Period
$
$
$
23
24
28
8
6
8
13
17
21
$
$
$
41
33
37
17
14
8
24
18
27
$
$
$
-
-
-
-
-
-
-
-
-
$
$
$
44
34
41
18
12
10
24
22
31
$
$
$
20
23
24
7
8
6
13
13
17
176
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, each registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. The signatures for each
undersigned company shall be deemed to relate only to matters having reference to such company or its subsidiaries.
SIGNATURES
Date: February 28, 2012
AMEREN CORPORATION (registrant)
By /s/ Thomas R. Voss
Thomas R. Voss
Chairman, President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the date indicated.
/s/ Thomas R. Voss
Thomas R. Voss
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Stephen F. Brauer
Catherine S. Brune
Ellen M. Fitzsimmons
Walter J. Galvin
Gayle P.W. Jackson
James C. Johnson
Steven H. Lipstein
Patrick T. Stokes
Stephen R. Wilson
*
*
*
*
*
*
*
*
*
*
Jack D. Woodard
*By /s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Attorney-in-Fact
Chairman, President and
Chief Executive Officer and Director
(Principal Executive Officer)
Senior Vice President and
Chief Financial Officer
(Principal Financial and Accounting
Officer)
Director
Director
Director
Director
Director
Director
Director
Director
Director
Director
177
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
Date: February 28, 2012
UNION ELECTRIC COMPANY (registrant)
By /s/ Warner L. Baxter
Warner L. Baxter
Chairman, President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the date indicated.
/s/ Warner L. Baxter
Warner L. Baxter
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Daniel F. Cole
Adam C. Heflin
Richard J. Mark
Charles D. Naslund
*
*
*
*
*
Gregory L. Nelson
*By /s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Attorney-in-Fact
Chairman, President,
Chief Executive Officer and Director
(Principal Executive Officer)
February 28, 2012
Senior Vice President, Chief Financial Officer
and Director (Principal Financial and
Accounting Officer)
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
Director
Director
Director
Director
Director
178
Date: February 28, 2012
AMEREN ILLINOIS COMPANY (registrant)
By /s/ Scott A. Cisel
Scott A. Cisel
Chairman, President and Chief Executive Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the date indicated.
/s/ Scott A. Cisel
Scott A. Cisel
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Daniel F. Cole
*
*
Gregory L. Nelson
*By /s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Attorney-in-Fact
Chairman, President,
Chief Executive Officer and Director
(Principal Executive Officer)
Senior Vice President, Chief Financial
Officer and Director (Principal Financial
and Accounting Officer)
Director
Director
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
179
AMEREN ENERGY GENERATING COMPANY (registrant)
Date: February 28, 2012
By /s/ Steven R. Sullivan
Steven R. Sullivan
Chairman and President
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the date indicated.
/s/ Steven R. Sullivan
Steven R. Sullivan
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Daniel F. Cole
*
*
Gregory L. Nelson
*By /s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Attorney-in-Fact
Chairman, President and Director
(Principal Executive Officer)
February 28, 2012
Senior Vice President, Chief Financial
Officer and Director (Principal Financial
and Accounting Officer)
Director
Director
February 28, 2012
February 28, 2012
February 28, 2012
February 28, 2012
180
EXHIBIT INDEX
The documents listed below are being filed or have previously been filed on behalf of the Ameren Companies and are
incorporated herein by reference from the documents indicated and made a part hereof. Exhibits not identified as previously
filed are filed herewith:
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
Plan of Acquisition, Reorganization, Arrangement, Liquidation or Succession
2.1
Ameren Illinois
Agreement and Plan of Merger, dated as of
April 13, 2010, among CIPS, CILCO and IP
Articles of Incorporation/ By-Laws
3.1(i)
Ameren
Restated Articles of Incorporation of Ameren
3.2(i)
Ameren
3.3(i)
Ameren
Certificate of Amendment to Ameren’s
Restated Articles of Incorporation filed
December 14, 1998
Certificate of Amendment to Ameren’s
Restated Articles of Incorporation filed
April 21, 2011
Annex A to Part I of the Registration
Statement on Form S-4,
File No. 333-166095).
Annex F to Part I of the Registration
Statement on Form S-4, File No. 33-64165
1998 Form 10-K, Exhibit 3(i),
File No. 1-14756
April 21, 2011 Form 8-K, Exhibit 3(i),
File No. 1-14756
3.4(i)
Ameren Missouri
Restated Articles of Incorporation of
Ameren Missouri
1993 Form 10-K, Exhibit 3(i),
File No. 1-2967
3.5(i)
Ameren Illinois
Restated Articles of Incorporation of
Ameren Illinois
2010 Form 10-K, Exhibit 3.4(i),
File No. 1-3672
3.6(i)
3.7(i)
Genco
Genco
3.8(ii)
Ameren
Articles of Incorporation of Genco
Exhibit 3.1, Form S-4, File No. 333-56594
Amendment to Articles of Incorporation of
Genco filed April 19, 2000
Exhibit 3.2, Form S-4, File No. 333-56594
By-Laws of Ameren, as amended October 8,
2010
October 13, 2010 Form 8-K, Exhibit 3.1(ii),
File No. 1-14756
3.9(ii)
Ameren Missouri
By-Laws of Ameren Missouri as amended
December 10, 2010
December 15, 2010 Form 8-K,
Exhibit 3.1(ii), File No. 1-2967
3.10(ii)
Ameren Illinois
Bylaws of Ameren Illinois as amended
December 10, 2010
December 15, 2010 Form 8-K,
Exhibit 3.2(ii), File No. 1-3672
3.11(ii)
Genco
Bylaws of Genco as amended December 10,
2010
December 15, 2010 Form 8-K,
Exhibit 3.3(ii), File No. 333-56594
Instruments Defining Rights of Security Holders, Including Indentures
4.1
Ameren
Indenture dated as of December 1, 2001
from Ameren to The Bank of New York
Mellon Trust Company, N.A., as successor
trustee, relating to senior debt securities
(Ameren Indenture)
Exhibit 4.5, File No. 333-81774
First Supplemental Indenture to Ameren
Senior Indenture dated as of May 19, 2008
June 30, 2008 Form 10-Q, Exhibit 4.1,
File No. 1-14756
May 15, 2009 Form 8-K, Exhibits 4.3 and
4.4, File No. 1-14756
Exhibit B-1, File No. 2-4940
Ameren Indenture Company Order dated
May 15, 2009, establishing 8.875% Senior
Notes, due 2014 (including the global note)
Indenture of Mortgage and Deed of Trust
dated June 15, 1937 (Ameren Missouri
Mortgage), from Ameren Missouri to The
Bank of New York Mellon, as successor
trustee, as amended May 1, 1941, and
Second Supplemental Indenture dated
May 1, 1941
Ameren
Ameren
Ameren
Ameren Missouri
4.2
4.3
4.4
4.5
Ameren
Ameren Missouri
Supplemental Indenture to the Ameren
Missouri Mortgage dated as of July 1, 1956
August 2, 1956 Form 8-K, Exhibit 2,
File No. 1-2967
181
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
4.6
4.7
4.8
4.9
4.10
4.11
4.12
4.13
4.14
4.15
4.16
4.17
4.18
4.19
4.20
4.21
4.22
4.23
4.24
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Supplemental Indenture to the Ameren
Missouri Mortgage dated as of April 1,
1971
Supplemental Indenture to the Ameren
Missouri Mortgage dated as of February 1,
1974
Supplemental Indenture to the Ameren
Missouri Mortgage dated as of July 7, 1980
Supplemental Indenture to the Ameren
Missouri Mortgage dated as of October 1,
1993, relative to Series 2028
Supplemental Indenture to the Ameren
Missouri Mortgage dated as of February 1,
2000
Supplemental Indenture to the Ameren
Missouri Mortgage dated August 15, 2002,
relative to Series AA
Supplemental Indenture to the Ameren
Missouri Mortgage dated March 5, 2003,
relative to Series BB
Supplemental Indenture to the Ameren
Missouri Mortgage dated April 1, 2003,
relative to Series CC
Supplemental Indenture to the Ameren
Missouri Mortgage dated July 15, 2003,
relative to Series DD
Supplemental Indenture to the Ameren
Missouri Mortgage dated October 1, 2003,
relative to Series EE
Supplemental Indenture to the Ameren
Missouri Mortgage dated February 1, 2004,
relative to Series 2004A (1998A)
Supplemental Indenture to the Ameren
Missouri Mortgage dated February 1, 2004,
relative to Series 2004B (1998B)
Supplemental Indenture to the Ameren
Missouri Mortgage dated February 1, 2004,
relative to Series 2004C (1998C)
Supplemental Indenture to the Ameren
Missouri Mortgage dated February 1, 2004,
relative to Series 2004H (1992)
Supplemental Indenture to the Ameren
Missouri Mortgage dated May 1, 2004
relative to Series FF
Supplemental Indenture to the Ameren
Missouri Mortgage dated September 1,
2004 relative to Series GG
Supplemental Indenture to the Ameren
Missouri Mortgage dated January 1, 2005
relative to Series HH
Supplemental Indenture to the Ameren
Missouri Mortgage dated July 1, 2005
relative to Series II
Supplemental Indenture to the Ameren
Missouri Mortgage dated December 1,
2005 relative to Series JJ
182
April 1971 Form 8-K, Exhibit 6,
File No. 1-2967
February 1974 Form 8-K, Exhibit 3,
File No. 1-2967
Exhibit 4.6, File No. 2-69821
1993 Form 10-K, Exhibit 4.8,
File No. 1-2967
2000 Form 10-K, Exhibit 4.1,
File No. 1-2967
August 23, 2002 Form 8-K, Exhibit 4.3,
File No. 1-2967
March 11, 2003 Form 8-K, Exhibit 4.4,
File No. 1-2967
April 10, 2003 Form 8-K, Exhibit 4.4,
File No. 1-2967
August 4, 2003 Form 8-K, Exhibit 4.4,
File No. 1-2967
October 8, 2003 Form 8-K, Exhibit 4.4,
File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.1,
File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.2,
File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.3,
File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.8,
File No. 1-2967
May 18, 2004 Form 8-K, Exhibit 4.4,
File No. 1-2967
September 23, 2004 Form 8-K, Exhibit 4.4,
File No. 1-2967
January 27, 2005 Form 8-K, Exhibit 4.4,
File No. 1-2967
July 21, 2005 Form 8-K, Exhibit 4.4,
File No. 1-2967
December 9, 2005 Form 8-K, Exhibit 4.4,
File No. 1-2967
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
4.25
4.26
4.27
4.28
4.29
4.30
4.31
4.32
4.33
4.34
4.35
4.36
4.37
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
June 15, 2007 Form 8-K, Exhibit 4.5,
File No. 1-2967
April 8, 2008 Form 8-K, Exhibit 4.7,
File No. 1-2967
June 19, 2008 Form 8-K, Exhibit 4.5,
File No. 1-2967
March 23, 2009 Form 8-K, Exhibit 4.5,
File No. 1-2967
1992 Form 10-K, Exhibit 4.38,
File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.10,
File No. 1-2967
September 30, 1998 Form 10-Q,
Exhibit 4.28, File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.11,
File No. 1-2967
September 30, 1998 Form 10-Q,
Exhibit 4.29, File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.12,
File No. 1-2967
September 30, 1998 Form 10-Q,
Exhibit 4.30, File No. 1-2967
March 31, 2004 Form 10-Q, Exhibit 4.13,
File No. 1-2967
August 23, 2002 Form 8-K, Exhibit 4.1,
File No. 1-2967
Supplemental Indenture to the Ameren
Missouri Mortgage dated June 1, 2007
relative to Series KK
Supplemental Indenture to the Ameren
Missouri Mortgage dated April 1, 2008
relative to Series LL
Supplemental Indenture to the Ameren
Missouri Mortgage dated June 1, 2008
relative to Series MM
Supplemental Indenture to the Ameren
Missouri Mortgage dated March 1, 2009
relative to Series NN
Loan Agreement dated as of December 1,
1992, between the Missouri Environmental
Authority and Ameren Missouri, together
with Indenture of Trust dated as of
December 1, 1992, between the Missouri
Environmental Authority and UMB Bank,
N.A. as successor trustee to Mercantile
Bank of St. Louis, N.A.
First Amendment dated as of February 1,
2004, to Loan Agreement dated as of
December 1, 1992, between the Missouri
Environmental Authority and Ameren
Missouri
Series 1998A Loan Agreement dated as of
September 1, 1998, between the Missouri
Environmental Authority and Ameren
Missouri
First Amendment dated as of February 1,
2004, to Series 1998A Loan Agreement
dated as of September 1, 1998, between
the Missouri Environmental Authority and
Ameren Missouri
Series 1998B Loan Agreement dated as of
September 1, 1998, between the Missouri
Environmental Authority and Ameren
Missouri
First Amendment dated as of February 1,
2004, to Series 1998B Loan Agreement
dated as of September 1, 1998, between
the Missouri Environmental Authority and
Ameren Missouri
Series 1998C Loan Agreement dated as of
September 1, 1998, between the Missouri
Environmental Authority and Ameren
Missouri
First Amendment dated as of February 1,
2004, to Series 1998C Loan Agreement
dated as of September 1, 1998, between
the Missouri Environmental Authority and
Ameren Missouri
Indenture dated as of August 15, 2002,
from Ameren Missouri to The Bank of New
York Mellon, as successor trustee (relating
to senior secured debt securities) (Ameren
Missouri Indenture)
183
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
4.38
4.39
4.40
4.41
4.42
4.43
4.44
4.45
4.46
4.47
4.48
4.49
4.50
4.51
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
Ameren
Ameren Missouri
August 23, 2002 Form 8-K, Exhibit 4.2,
File No. 1-2967
March 11, 2003 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
April 10, 2003 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
August 4, 2003 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
October 8, 2003 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
May 18, 2004 Form 8-K, Exhibits 4.2 and
4.3, No. 1-2967
September 23, 2004 Form 8-K, Exhibits 4.2
and 4.3, No. 1-2967
January 27, 2005 Form 8-K, Exhibits 4.2
and 4.3, File No. 1-2967
July 21, 2005 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
December 9, 2005 Form 8-K, Exhibits 4.2
and 4.3, File No. 1-2967
June 15, 2007 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
April 8, 2008 Form 8-K, Exhibits 4.3 and
4.5, File No. 1-2967
June 19, 2008 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
March 23, 2009 Form 8-K, Exhibits 4.2 and
4.3, File No. 1-2967
Ameren Missouri Indenture Company Order
dated August 22, 2002, establishing the
5.25% Senior Secured Notes due 2012
(including the global note)
Ameren Missouri Indenture Company Order
dated March 10, 2003, establishing the
5.50% Senior Secured Notes due 2034
(including the global note)
Ameren Missouri Indenture Company Order
dated April 9, 2003, establishing the 4.75%
Senior Secured Notes due 2015 (including
the global note)
Ameren Missouri Indenture Company Order
dated July 28, 2003, establishing the 5.10%
Senior Secured Notes due 2018 (including
the global note)
Ameren Missouri Indenture Company Order
dated October 7, 2003, establishing the
4.65% Senior Secured Notes due 2013
(including the global note)
Ameren Missouri Indenture Company Order
dated May 13, 2004, establishing the
5.50% Senior Secured Notes due 2014
(including the global note)
Ameren Missouri Indenture Company Order
dated September 1, 2004, establishing the
5.10% Senior Secured Notes due 2019
(including the global note)
Ameren Missouri Indenture Company Order
dated January 27, 2005, establishing the
5.00% Senior Secured Notes due 2020
(including the global note)
Ameren Missouri Indenture Company Order
dated July 21, 2005, establishing the 5.30%
Senior Secured Notes due 2037 (including
the global note)
Ameren Missouri Indenture Company Order
dated December 8, 2005, establishing the
5.40% Senior Secured Notes due 2016
(including the global note)
Ameren Missouri Indenture Company Order
dated June 15, 2007, establishing the
6.40% Senior Secured Notes due 2017
(including the global note)
Ameren Missouri Indenture Company Order
dated April 8, 2008, establishing the 6.00%
Senior Secured Notes due 2018 (including
the global note)
Ameren Missouri Indenture Company Order
dated June 19, 2008, establishing the
6.70% Senior Secured Notes due 2019
(including the global note)
Ameren Missouri Indenture Company Order
dated March 20, 2009, establishing 8.45%
Senior Secured Notes due 2039 (including
the global note)
184
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
4.52
4.53
4.54
4.55
4.56
4.57
4.58
4.59
4.60
4.61
4.62
4.63
4.64
4.65
4.66
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Exhibit 4.4, File No. 333-59438
Indenture dated as of December 1, 1998,
from Central Illinois Public Service
Company (now known as Ameren Illinois)
to The Bank of New York Mellon Trust
Company, N.A., as successor trustee (CIPS
Indenture)
First Supplemental Indenture to the CIPS
Indenture, dated as of June 14, 2006
June 19, 2006 Form 8-K, Exhibit 4.2,
File No. 1-3672
Second Supplemental Indenture to the CIPS
Indenture, dated as of March 1, 2010
Exhibit 4.17, File No. 333-166095
Third Supplemental Indenture to the CIPS
Indenture, dated as of October 1, 2010
2010 Form 10-K, Exhibit 4.59,
File No. 1-3672
2010 Form 10-K, Exhibit 4.60,
File No. 1-3672
2010 Form 10-K, Exhibit 4.62,
File No. 1-3672
Exhibit B-1, Registration No. 2-1937;
Exhibit B-1(a), Registration No. 2-2093; and
Exhibit A, April 1940 Form 8-K,
File No. 1-2732
Ameren Illinois Global Note, dated
October 1, 2010, representing CIPS
Indenture Senior Notes, 6.125% due 2028
Ameren Illinois Global Note, dated
October 1, 2010, representing CIPS
Indenture Senior Notes, 6.70% Series
Secured Notes due 2036
Indenture of Mortgage and Deed of Trust
between Illinois Power Company
(predecessor in interest to CILCO and
Ameren Illinois) and Bankers Trust
Company (now known as Deutsche Bank
Trust Company Americas), as trustee, dated
as of April 1, 1933 (CILCO Mortgage),
Supplemental Indenture between the same
parties dated as of June 30, 1933,
Supplemental Indenture between CILCO
(predecessor in interest to Ameren Illinois)
and the trustee, dated as of July 1, 1933,
Supplemental Indenture between the same
parties dated as of January 1, 1935, and
Supplemental Indenture between the same
parties dated as of April 1, 1940
Supplemental Indenture to the CILCO
Mortgage, dated December 1, 1949
December 1949 Form 8-K, Exhibit A,
File No. 1-2732
Supplemental Indenture to the CILCO
Mortgage, dated July 1, 1957
July 1957 Form 8-K, Exhibit A,
File No. 1-2732
Supplemental Indenture to the CILCO
Mortgage, dated February 1, 1966
February 1966 Form 8-K, Exhibit A,
File No. 1-2732
Supplemental Indenture to the CILCO
Mortgage, dated January 15, 1992
January 30, 1992 Form 8-K, Exhibit 4(b),
File No. 1-2732
Supplemental Indenture to the CILCO
Mortgage, dated June 1, 2006 for the
Series AA and BB
Supplemental Indenture to the CILCO
Mortgage, dated December 1, 2008 for the
Series CC
June 19, 2006 Form 8-K, Exhibit 4.11,
File No. 1-2732
December 9, 2008 Form 8-K, Exhibit 4.5,
File No. 1-2732
Supplemental Indenture to the CILCO
Mortgage, dated as of October 1, 2010
October 7, 2010 Form 8 K, Exhibit 4.4,
File No. 1-14756
Indenture dated as of June 1, 2006, from
CILCO (predecessor in interest to Ameren
Illinois) to The Bank of New York Mellon
Trust Company, N.A., as successor trustee
(CILCO Indenture)
June 19, 2006 Form 8-K, Exhibit 4.3,
File No. 1-2732
185
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
4.67
4.68
4.69
4.70
4.71
4.72
4.73
4.74
4.75
4.76
4.77
4.78
4.79
4.80
4.81
4.82
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
First Supplemental Indenture to the CILCO
Indenture, dated October 1, 2010
October 7, 2010 Form 8 K, Exhibit 4.1,
File No. 1-3672
Second Supplemental Indenture to the
CILCO Indenture dated as of July 21, 2011
September 30, 2011 Form 10-Q,
Exhibit 4.1, File No. 1-3672
CILCO Indenture Company Order, dated
June 14, 2006, establishing the 6.20%
Senior Secured Notes due 2016 (including
the global note) and the 6.70% Senior
Secured Notes due 2036 (including the
global note)
CILCO Indenture Company Order, dated
December 9, 2008, establishing the 8.875%
Senior Secured Notes due 2013 (including
the global note)
General Mortgage Indenture and Deed of
Trust dated as of November 1, 1992
between Illinois Power Company
(predecessor in interest to Ameren Illinois)
and The Bank of New York Mellon Trust
Company, N.A., as successor trustee
(Ameren Illinois Mortgage)
Supplemental Indenture dated as of
March 1, 1998, to Ameren Illinois Mortgage
for Series S
Supplemental Indenture dated as of
March 1, 1998, to Ameren Illinois Mortgage
for Series T
Supplemental Indenture amending the
Ameren Illinois Mortgage dated as of June
15, 1999
Supplemental Indenture dated as of
July 15, 1999, to Ameren Illinois Mortgage
for Series U
Supplemental Indenture amending the
Ameren Illinois Mortgage dated as of
December 15, 2002
Supplemental Indenture dated as of June 1,
2006, to Ameren Illinois Mortgage for
Series AA
Supplemental Indenture dated as of
November 15, 2007, to Ameren
Illinois Mortgage for Series BB
June 19, 2006 Form 8-K, Exhibit 4.6,
File No. 1-2732
December 9, 2008 Form 8-K, Exhibits 4.2
and 4.3, File No. 1-2732
1992 Form 10-K, Exhibit 4(cc),
File No. 1-3004
Exhibit 4.41, File No. 333-71061
Exhibit 4.42, File No. 333-71061
June 30, 1999 Form 10-Q, Exhibit 4.2,
File No. 1-3004
June 30, 1999 Form 10-Q, Exhibit 4.4,
File No. 1-3004
December 23, 2002 Form 8-K, Exhibit 4.1,
File No. 1-3004
June 19, 2006 Form 8-K, Exhibit 4.13,
File No. 1-3004
November 20, 2007 Form 8-K, Exhibit 4.4,
File No. 1-3004
Supplemental Indenture dated as of April 1,
2008, to Ameren Illinois Mortgage for
Series CC
April 8, 2008 Form 8-K, Exhibit 4.9,
File No. 1-3004
October 23, 2008 Form 8-K, Exhibit 4.4,
File No. 1-3004
October 7, 2010 Form 8 K, Exhibit 4.9,
File No. 1-3672
June 19, 2006 Form 8-K, Exhibit 4.4,
File No. 1-3004
Supplemental Indenture dated as of
October 1, 2008, to Ameren
Illinois Mortgage for Series DD
Supplemental Indenture, dated as of
October 1, 2010, to Ameren
Illinois Mortgage for Series CIPS-AA,
CIPS-BB and CIPS-CC
Indenture, dated as of June 1, 2006 from IP
(predecessor in interest to Ameren Illinois)
to The Bank of New York Mellon Trust
Company, N.A., as successor trustee
(Ameren Illinois Indenture)
186
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
4.83
4.84
4.85
4.86
4.87
4.88
4.89
4.90
4.91
4.92
4.93
4.94
Material Contracts
10.1
10.2
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Genco
Ameren
Genco
Ameren
Genco
Ameren
Genco
Ameren
Genco
Ameren
Genco
Ameren
Genco
Ameren
Genco
October 7, 2010 Form 8 K, Exhibit 4.5,
File No. 1-14756
September 30, 2011 Form 10-Q, Exhibit
4.2, File No. 1-3672
June 19, 2006 Form 8-K, Exhibit 4.7,
File No. 1-3004
November 20, 2007 Form 8-K, Exhibit 4.2,
File No. 1-3004
April 8, 2008 Form 8-K, Exhibit 4.4,
File No. 1-3004
October 23, 2008 Form 8-K, Exhibit 4.2,
File No. 1-3004
Exhibit 4.1, File No. 333-56594
June 30, 2002 Form 10-Q, Exhibit 4.1,
File No. 333-56594
2002 Form 10-K, Exhibit 4.5,
File No. 333-56594
April 9, 2008 Form 8-K, Exhibit 4.2,
File No. 333-56594
Exhibit No. 4.55, File No. 333-155416
November 17, 2009 Form 8-K, Exhibit 4.8,
File No. 333-56594
March 28, 2008 Form 8-K, Exhibit 10.3,
File No. 1-14756
2009 Form 10-K, Exhibit 10.2,
File No. 1-14756
First Supplemental Indenture, dated as of
October 1, 2010, to the Ameren
Illinois Indenture for Series CIPS-AA,
CIPS-BB and CIPS-CC
Second Supplemental Indenture to the
Ameren Illinois Indenture dated as of
July 21, 2011
Ameren Illinois Indenture Company Order,
dated June 14, 2006, establishing the
6.25% Senior Secured Notes due 2016
(including the global note)
Ameren Illinois Indenture Company Order,
dated November 15, 2007, establishing
6.125% Senior Secured Notes due 2017
(including the global note)
Ameren Illinois Indenture Company Order,
dated April 8, 2008, establishing 6.25%
Senior Secured Notes due 2018 (including
the global note)
Ameren Illinois Indenture Company Order
dated October 23, 2008, establishing 9.75%
Senior Secured Notes due 2018 (including
the global note)
Indenture dated as of November 1, 2000,
from Genco to The Bank of New York
Mellon Trust Company, N.A., as successor
trustee (Genco Indenture)
Third Supplemental Indenture dated as of
June 1, 2002, to Genco Indenture, relating
to Genco’s 7.95% Senior Notes, Series E
due 2032
Fourth Supplemental Indenture dated as of
January 15, 2003, to Genco Indenture,
relating to Genco 7.95% Senior Notes,
Series F due 2032
Fifth Supplemental Indenture dated as of
April 1, 2008, to Genco Indenture, relating
to Genco 7.00% Senior Notes, Series G due
2018
Sixth Supplemental Indenture, dated as of
July 7, 2008, to Genco Indenture, relating
to Genco 7.00% Senior Notes, Series H due
2018
Seventh Supplemental Indenture, dated as
of November 1, 2009, to Genco Indenture,
relating to Genco 6.30% Senior Notes,
Series l due 2020
Amended and Restated Power Supply
Agreement, dated March 28, 2008, between
Marketing Company and Genco
First Amendment dated January 1, 2010, to
Amended and Restated Power Supply
Agreement, dated March 28, 2008, between
Marketing Company and Genco
187
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
10.3
Ameren
Ameren Illinois
10.4
Ameren Companies
10.5
10.6
10.7
10.8
Ameren
Genco
Ameren
Ameren Missouri
Ameren
Genco
Ameren
Ameren Illinois
10.9
Ameren
Unilateral Borrowing Agreement by and
among Ameren, IP (predecessor in interest
to Ameren Illinois) and Ameren Services,
dated as of September 30, 2004
Third Amended Ameren Corporation
System Utility Money Pool Agreement, as
amended September 30, 2004
Ameren Corporation System Amended and
Restated Non-Regulated Subsidiary Money
Pool Agreement, dated March 1, 2008
Credit Agreement, dated as of September
10, 2010, by and among Ameren, Ameren
Missouri and JPMorgan Chase Bank, N.A.,
as agent, and the lenders party thereto.
Credit Agreement, dated as of September
10, 2010, by and among Ameren, Genco
and JPMorgan Chase Bank, N.A., as agent,
and the lenders party thereto.
Credit Agreement, dated as of
September 10, 2010, by and among
Ameren, CIPS (now Ameren Illinois), CILCO
and IP (predecessors in interest to Ameren
Illinois) and JPMorgan Chase Bank, N.A., as
agent, and the lenders party thereto.
*Summary Sheet of Ameren Corporation
Non-Management Director Compensation
revised on August 8, 2008
October 1, 2004 Form 8-K, Exhibit 10.3,
File No. 1-3004
October 1, 2004 Form 8-K, Exhibit 10.2,
File No. 1-14756
March 31, 2008 Form 10-Q, Exhibit 10.1,
File No. 1-14756
September 13, 2010 Form 8-K,
Exhibit 10.1, File No. 1-14756
September 13, 2010 Form 8-K,
Exhibit 10.2, File No. 1-14756
September 13, 2010 Form 8-K,
Exhibit 10.3, File No. 1-14756
September 30, 2008 Form 10-Q,
Exhibit 10.1, File No. 1-14756
10.10
Ameren Companies
*Ameren’s Long-Term Incentive Plan of
1998
1998 Form 10-K, Exhibit 10.1,
File No. 1-14756
10.11
Ameren Companies
*First Amendment to Ameren’s Long-Term
Incentive Plan of 1998
February 16, 2006 Form 8-K, Exhibit 10.6,
File No. 1-14756
10.12
Ameren Companies
10.13
Ameren
10.14
Ameren Companies
10.15
Ameren Companies
10.16
Ameren Companies
*Form of Restricted Stock Award under
Ameren’s Long-Term Incentive Plan of
1998
*Ameren’s Deferred Compensation Plan for
Members of the Board of Directors
amended and restated effective January 1,
2009, dated June 13, 2008
*Amendment dated October 12, 2009, to
Ameren’s Deferred Compensation Plan for
Members of the Board of Directors,
effective January 1, 2010
*Amendment dated October 14, 2010, to
Ameren’s Deferred Compensation Plan for
Members of the Board of Directors
*Ameren’s Deferred Compensation Plan as
amended and restated effective January 1,
2010
February 14, 2005 Form 8-K, Exhibit 10.1,
File No. 1-14756
June 30, 2008 Form 10-Q, Exhibit 10.3,
File No. 1-14756
2009 Form 10-K, Exhibit 10.15 ,
File No. 1-14756
2010 Form 10-K, Exhibit 10.15,
File No. 1-14756
October 14, 2009 Form 8-K, Exhibit 10.1,
File No. 1-14756
10.17
Ameren Companies
*Amendment dated October 14, 2010 to
Ameren’s Deferred Compensation Plan
2010 Form 10-K, Exhibit 10.17,
File No. 1-14756
10.18
Ameren Companies
*2010 Ameren Executive Incentive Plan
10.19
Ameren Companies
*2011 Ameren Executive Incentive Plan
10.20
Ameren Companies
*2012 Ameren Executive Incentive Plan
December 17, 2009 Form 8-K, Exhibit 10.1,
File No. 1-14756
December 15, 2010 Form 8-K, Exhibit 10.1,
File No. 1-14756
December 14, 2011 Form 8-K, Exhibit 10.1,
File No. 1-14756
188
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
10.21
Ameren Companies
10.22
Ameren Companies
10.23
Ameren Companies
10.24
Ameren Companies
10.25
Ameren Companies
10.26
Ameren Companies
10.27
Ameren Companies
*2010 Base Salary Table for Named
Executive Officers
*2011 Base Salary Table for Named
Executive Officers
*2012 Base Salary Table for Named
Executive Officers
*Second Amended and Restated Ameren
Corporation Change of Control Severance
Plan
*First Amendment dated October 12, 2009,
to the Second Amended and Restated
Ameren Change of Control Severance Plan
*Revised Schedule I to Second Amended
and Restated Ameren Change of Control
Severance Plan, as amended
*Table of 2008 Target Performance Share
Unit Awards Issued to Named Executive
Officers
2009 Form 10-K, Exhibit 10.29,
File No. 1-14756
2010 Form 10-K, Exhibit 10.21,
File No. 1-14756
2008 Form 10-K, Exhibit 10.37,
File No. 1-14756
October 14, 2009 Form 8-K, Exhibit 10.2,
File No. 1-14756
February 14, 2008 Form 8-K, Exhibit 99.1,
File No. 1-14756
10.28
Ameren Companies
*Table of 2009 Target Performance Share
Unit Awards Issued to Executive Officers
March 2, 2009 Form 8-K, Exhibit 99.1,
File No. 1-14756
10.29
Ameren Companies
10.30
Ameren Companies
10.31
Ameren Companies
*Formula for Determining 2010 Target
Performance Share Unit Awards to be
Issued to Named Executive Officers
*Formula for Determining 2011 Target
Performance Share Unit Awards to be
Issued to Named Executive Officers
*Formula for Determining 2012 Target
Performance Share Unit Awards to be
Issued to Named Executive Officers
December 17, 2009 Form 8-K, Exhibit 99.1,
File No. 1-14756
December 15, 2010 Form 8-K, Exhibit 99.1,
File No. 1-14756
December 14, 2011 Form 8-K, Exhibit 99.1,
File No. 1-14756
10.32
Ameren Companies
*Ameren Corporation 2006 Omnibus
Incentive Compensation Plan
February 16, 2006 Form 8-K, Exhibit 10.3,
File No. 1-14756
10.33
Ameren Companies
10.34
Ameren Companies
10.35
Ameren Companies
10.36
Ameren Companies
10.37
Ameren Companies
10.38
Ameren Companies
10.39
Ameren Companies
February 16, 2006 Form 8-K, Exhibit 10.4,
File No. 1-14756
March 2, 2009 Form 8-K, Exhibit 10.1,
File No. 1-14756
December 17, 2009 Form 8-K, Exhibit 10.2,
File No. 1-14756
December 15, 2010 Form 8-K, Exhibit 10.2,
File No. 1-14756
December 14, 2011 Form 8-K, Exhibit 10.2,
File No. 1-14756
March 31, 2011 Form 10-Q, Exhibit 10.1,
File No. 1-14756
June 30, 2008 Form 10-Q, Exhibit 10.1,
File No. 1-14756
*Form of Performance Share Unit Award
Issued in 2006-2008 pursuant to 2006
Omnibus Incentive Compensation Plan
*Form of Performance Share Unit for
Award Issued in 2009 pursuant to 2006
Omnibus Incentive Compensation Plan
*Form of Performance Share Unit for
Award Issued in 2010 pursuant to 2006
Omnibus Incentive Compensation Plan
*Form of Performance Share Unit for
Award to be Issued in 2011 pursuant to
2006 Omnibus Incentive Compensation
Plan
*Form of Performance Share Unit Award
Agreement for Awards Issued in 2012
pursuant to 2006 Omnibus Incentive
Compensation Plan
*Performance Stock Bonus Award
Agreement, dated March 1, 2011, between
Ameren and Adam C. Heflin
*Ameren Supplemental Retirement Plan
amended and restated effective January 1,
2008, dated June 13, 2008
189
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
10.40
Ameren Companies
10.41
10.42
10.43
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Ameren
Ameren Illinois
Statement re: Computation of Ratios
12.1
12.2
Ameren
Ameren Missouri
12.3
Ameren Illinois
12.4
Genco
Code of Ethics
*First Amendment to amended and restated
Ameren Supplemental Retirement Plan
dated October 24, 2008
2008 Form 10-K, Exhibit 10.44,
File No. 1-14756
*CILCO Executive Deferral Plan as amended
effective August 15, 1999
1999 Form 10-K, Exhibit 10,
File No. 1-2732
*CILCO Executive Deferral Plan II as
amended effective April 1, 1999
1999 Form 10-K, Exhibit 10(a),
File No. 1-2732
*CILCO Restructured Executive Deferral
Plan (approved August 15, 1999)
1999 Form 10-K, Exhibit 10(e),
File No. 1-2732
Ameren’s Statement of Computation of
Ratio of Earnings to Fixed Charges
Ameren Missouri’s Statement of
Computation of Ratio of Earnings to Fixed
Charges and Combined Fixed Charges and
Preferred Stock Dividend Requirements
Ameren Illinois’ Statement of Computation
of Ratio of Earnings to Fixed Charges and
Combined Fixed Charges and Preferred
Stock Dividend Requirements
Genco’s Statement of Computation of Ratio
of Earnings to Fixed Charges
14.1
Ameren Companies
Code of Ethics amended as of June 11,
2004
June 30, 2004 Form 10-Q, Exhibit 14.1,
File No. 1-14756
Subsidiaries of the Registrant
21.1
Ameren Companies
Subsidiaries of Ameren
Consent of Experts and Counsel
23.1
Ameren
Power of Attorney
Consent of Independent Registered Public
Accounting Firm with respect to Ameren
24.1
24.2
24.3
24.4
Ameren
Power of Attorney with respect to Ameren
Ameren Missouri
Ameren Illinois
Power of Attorney with respect to Ameren
Missouri
Power of Attorney with respect to Ameren
Illinois
Genco
Power of Attorney with respect to Genco
Rule 13a-14(a)/15d-14(a) Certifications
31.1
31.2
31.3
Ameren
Ameren
Ameren Missouri
31.4
Ameren Missouri
31.5
Ameren Illinois
Rule 13a-14(a)/15d-14(a) Certification of
Principal Executive Officer of Ameren
Rule 13a-14(a)/15d-14(a) Certification of
Principal Financial Officer of Ameren
Rule 13a-14(a)/15d-14(a) Certification of
Principal Executive Officer of Ameren
Missouri
Rule 13a-14(a)/15d-14(a) Certification of
Principal Financial Officer of Ameren
Missouri
Rule 13a-14(a)/15d-14(a) Certification of
Principal Executive Officer of Ameren
Illinois
31.6
Ameren Illinois
Rule 13a-14(a)/15d-14(a) Certification of
Principal Financial Officer of Ameren Illinois
190
Exhibit Designation
Registrant(s)
Nature of Exhibit
Previously Filed as Exhibit to:
31.7
31.8
Genco
Genco
Section 1350 Certifications
32.1
Ameren
32.2
Ameren Missouri
32.3
Ameren Illinois
32.4
Genco
Additional Exhibits
99.1
Ameren
99.2
Ameren
Rule 13a-14(a)/15d-14(a) Certification of
Principal Executive Officer of Genco
Rule 13a-14(a)/15d-14(a) Certification of
Principal Financial Officer of Genco
Section 1350 Certification of Principal
Executive Officer and Principal Financial
Officer of Ameren
Section 1350 Certification of Principal
Executive Officer and Principal Financial
Officer of Ameren Missouri
Section 1350 Certification of Principal
Executive Officer and Principal Financial
Officer of Ameren Illinois
Section 1350 Certification of Principal
Executive Officer and Principal Financial
Officer of Genco
Amended and Restated Power Supply
Agreement, dated March 28, 2008, between
Marketing Company and AERG
First Amendment dated January 1, 2010, to
Amended and Restated Power Supply
Agreement dated March 28, 2008, between
Marketing Company and AERG
March 28, 2008 Form 8-K, Exhibit 99.1,
File No. 1-14756
2009 Form 10-K, Exhibit 99.2,
File No. 1-14756
Interactive Data File
101.INS**
Ameren Companies
XBRL Instance Document
101.SCH**
Ameren Companies
101.CAL**
Ameren Companies
101.LAB**
Ameren Companies
101.PRE**
Ameren Companies
101.DEF**
Ameren Companies
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XBRL Taxonomy Extension Calculation
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XBRL Taxonomy Extension Label Linkbase
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The file number references for the Ameren Companies’ filings with the SEC are: Ameren, 1-14756; Ameren Missouri,
1-2967; Ameren Illinois, 1-3672; and Genco, 333-56594.
*Compensatory plan or arrangement.
**Attached as Exhibit 101 to this report is the following financial information for each of the Ameren Companies’ Annual
Report on Form 10-K for the year ended December 31, 2011, formatted in XBRL (eXtensible Business Reporting Language):
(i) the Consolidated Statement of Income for the years ended December 31, 2011, 2010, and 2009, (ii) the Consolidated
Balance Sheet at December 31, 2011, and December 31, 2010, (iii) the Consolidated Statement of Cash Flows for the years
ended December 31, 2011, 2010, and 2009, (iv) the Consolidated Statement of Stockholders’ Equity for the years ended
December 31, 2011, 2010, and 2009, and (v) the Combined Notes to the Financial Statements for the year ended
December 31, 2011. For Ameren Missouri, Ameren Illinois, and Genco, these exhibits are deemed furnished and not filed
pursuant to Rule 406T of Regulation S-T.
Each registrant hereby undertakes to furnish to the SEC upon request a copy of any long-term debt instrument not listed
above that such registrant has not filed as an exhibit pursuant to the exemption provided by Item 601(b)(4)(iii)(A) of
Regulation S-K.
191
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL EXECUTIVE OFFICER OF AMEREN CORPORATION
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.1
I, Thomas R. Voss, certify that:
1.
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Corporation;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Thomas R. Voss
Thomas R. Voss
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL FINANCIAL OFFICER OF AMEREN CORPORATION
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.2
I, Martin J. Lyons, Jr., certify that:
1.
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Corporation;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL EXECUTIVE OFFICER OF UNION ELECTRIC COMPANY
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.3
I, Warner L. Baxter, certify that:
1.
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Union Electric Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Warner L. Baxter
Warner L. Baxter
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL FINANCIAL OFFICER OF UNION ELECTRIC COMPANY
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.4
I, Martin J. Lyons, Jr., certify that:
1.
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Union Electric Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
Exhibit 31.5
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL EXECUTIVE OFFICER OF AMEREN ILLINOIS COMPANY
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
I, Scott A. Cisel, certify that:
1.
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Illinois Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Scott A. Cisel
Scott A. Cisel
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL FINANCIAL OFFICER OF AMEREN ILLINOIS COMPANY
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.6
I, Martin J. Lyons, Jr., certify that:
1.
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Illinois Company;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL EXECUTIVE OFFICER OF AMEREN ENERGY GENERATING COMPANY
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.7
I, Steven R. Sullivan, certify that:
1.
Company;
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Energy Generating
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Steven R. Sullivan
Steven R. Sullivan
Chairman and President
(Principal Executive Officer)
RULE 13a-14(a)/15d-14(a) CERTIFICATION
OF PRINCIPAL FINANCIAL OFFICER OF AMEREN ENERGY GENERATING COMPANY
(required by Section 302 of the Sarbanes-Oxley Act of 2002)
Exhibit 31.8
I, Martin J. Lyons, Jr., certify that:
1.
Company;
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Energy Generating
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements made, in light of the circumstances under which such statements were made,
not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly
present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the
periods presented in this report;
4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and
procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as
defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to
be designed under our supervision, to ensure that material information relating to the registrant, including
its consolidated subsidiaries, is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) Designed such internal control over financial reporting, or caused such internal control over financial
reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with
generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this
report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of
the period covered by this report based on such evaluation; and
d) Disclosed in this report any change in the registrant’s internal control over financial reporting that
occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case
of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s
internal control over financial reporting; and
5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control
over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons
performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over
financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process,
summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant
role in the registrant’s internal control over financial reporting.
Date: February 28, 2012
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
SECTION 1350 CERTIFICATION OF
AMEREN CORPORATION
(required by Section 906 of the Sarbanes-Oxley Act of 2002)
Exhibit 32.1
In connection with the report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Corporation
(the “Registrant”) as filed by the Registrant with the Securities and Exchange Commission on the date hereof (the
“Form 10-K”), each undersigned officer of the Registrant does hereby certify, pursuant to 18 U.S.C. §1350, as adopted
pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of
1934 (15 U.S.C. 78m or 78o(d)); and
(2) The information contained in the Form 10-K fairly presents, in all material respects, the financial condition and
results of operations of the Registrant.
Date: February 28, 2012
/s/ Thomas R. Voss
Thomas R. Voss
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
SECTION 1350 CERTIFICATION OF
UNION ELECTRIC COMPANY
(required by Section 906 of the
Sarbanes-Oxley Act of 2002)
Exhibit 32.2
In connection with the report on Form 10-K for the fiscal year ended December 31, 2011, of Union Electric Company (the
“Registrant”) as filed by the Registrant with the Securities and Exchange Commission on the date hereof (the “Form 10-K”),
each undersigned officer of the Registrant does hereby certify, pursuant to 18 U.S.C. §1350, as adopted pursuant to §906 of
the Sarbanes-Oxley Act of 2002, that:
(1) The Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of
1934 (15 U.S.C. 78m or 78o(d)); and
(2) The information contained in the Form 10-K fairly presents, in all material respects, the financial condition and
results of operations of the Registrant.
Date: February 28, 2012
/s/ Warner L. Baxter
Warner L. Baxter
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
SECTION 1350 CERTIFICATION OF
AMEREN ILLINOIS COMPANY
(required by Section 906 of the
Sarbanes-Oxley Act of 2002)
Exhibit 32.3
In connection with the report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Illinois Company
(the “Registrant”) as filed by the Registrant with the Securities and Exchange Commission on the date hereof (the
“Form 10-K”), each undersigned officer of the Registrant does hereby certify, pursuant to 18 U.S.C. §1350, as adopted
pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of
1934 (15 U.S.C. 78m or 78o(d)); and
(2) The information contained in the Form 10-K fairly presents, in all material respects, the financial condition and
results of operations of the Registrant.
Date: February 28, 2012
/s/ Scott A. Cisel
Scott A. Cisel
Chairman, President and Chief Executive Officer
(Principal Executive Officer)
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
SECTION 1350 CERTIFICATION OF
AMEREN ENERGY GENERATING COMPANY
(required by Section 906 of the
Sarbanes-Oxley Act of 2002)
Exhibit 32.4
In connection with the report on Form 10-K for the fiscal year ended December 31, 2011, of Ameren Energy Generating
Company (the “Registrant”) as filed by the Registrant with the Securities and Exchange Commission on the date hereof (the
“Form 10-K”), each undersigned officer of the Registrant does hereby certify, pursuant to 18 U.S.C. §1350, as adopted
pursuant to §906 of the Sarbanes-Oxley Act of 2002, that:
(1) The Form 10-K fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of
1934 (15 U.S.C. 78m or 78o(d)); and
(2) The information contained in the Form 10-K fairly presents, in all material respects, the financial condition and
results of operations of the Registrant.
Date: February 28, 2012
/s/ Steven R. Sullivan
Steven R. Sullivan
Chairman and President
(Principal Executive Officer)
/s/ Martin J. Lyons, Jr.
Martin J. Lyons, Jr.
Senior Vice President and Chief Financial Officer
(Principal Financial Officer)
Investor Information
COMMON STOCK AND DIVIDEND INFORMATION
Ameren’s common stock is listed on the New York Stock Exchange
(ticker symbol: AEE). Ameren began trading on January 2, 1998,
following the merger of Union Electric Company and CIPSCO Inc. on
December 31, 1997. Ameren common shareholders of record totaled
63,684 on December 31, 2011. The following table provides the closing
price ranges and dividends paid per Ameren common share during
each quarter of 2011 and 2010.
AEE 2011
Quarter Ended
March 31
June 30
September 30
December 31
AEE 2010
Quarter Ended
March 31
June 30
September 30
December 31
High
Low
Close
$29.14
30.14
31.44
$26.46
27.78
25.55
34.11
27.98
$28.07
28.84
29.77
33.13
Dividends
Paid
38 1⁄2 ¢
38 1⁄2
38 1⁄2
40
High
Low
Close
Paid
Dividends
$28.27
26.92
28.99
$24.14
23.09
23.45
29.89
27.65
$26.08
23.77
28.40
28.19
38 1⁄2 ¢
38 1⁄2
38 1⁄2
38 1⁄2
ANNUAL MEETING
The annual meeting of Ameren Corporation shareholders will convene at
9 a.m. (Central Time), Tuesday, April 24, 2012, at Powell Symphony Hall,
718 North Grand Boulevard, St. Louis, Missouri. The annual shareholder
meetings of Ameren Illinois Company and Union Electric Company will be
held at the same time.
DRPLUS
Any person of legal age or entity, whether or not an Ameren
shareholder, is eligible to participate in DRPlus, Ameren’s dividend
reinvestment and stock purchase plan. Participants can:
(cid:129) make cash investments by check or automatic direct debit to their
bank accounts to purchase Ameren common stock, totaling up to
$120,000 annually,
(cid:129) reinvest their dividends in Ameren common stock (minimum dividend
reinvestment requirement of 10% as of January 1, 2012) or receive
Ameren dividends in cash and
(cid:129) place Ameren common stock certificates in safekeeping and receive
regular account statements.
For more information about DRPlus, you may obtain a prospectus from
Ameren’s Investor Services representatives.
DIRECT DEPOSIT OF DIVIDENDS
All registered Ameren common and Ameren Illinois Company and
Union Electric Company preferred shareholders can have their
cash dividends automatically deposited to their bank accounts. This
service gives shareholders immediate access to their dividend on the
dividend payment date and eliminates the possibility of lost or stolen
dividend checks.
CORPORATE GOVERNANCE DOCUMENTS
Ameren makes available, free of charge through its website
(www.ameren.com), the charters of the board of directors’ audit
and risk committee, human resources committee, nominating
and corporate governance committee, nuclear oversight and
environmental committee, and finance committee. Also available on
Ameren’s website are its corporate governance guidelines, policy
regarding nominations of directors, policy regarding communications
to the board of directors, policy and procedures with respect to
related person transactions, Code of Business Conduct (referred to as
the “Corporate Compliance Policy”) and its Code of Ethics for principal
executive and senior financial officers. These documents are also
available in print, free of charge upon written request, from the Office
of the Secretary, Ameren Corporation, P.O. Box 66149, Mail Code 1370,
St. Louis, MO 63166-6149. Ameren also makes available, free of charge
through its website, the company’s annual reports on SEC Form 10-K,
quarterly reports on SEC Form 10-Q, and its current reports on SEC
Form 8-K, including any chief executive officer and chief financial
officer certifications required to be filed with the Securities and
Exchange Commission therewith.
ONLINE STOCK ACCOUNT ACCESS
Ameren’s website (www.ameren.com) allows registered shareholders
to access their account information online. Shareholders can
securely change their reinvestment options, view account summaries,
receive DRPlus statements and more through the website. This is a
free service.
INVESTOR SERVICES
Ameren’s Investor Services representatives are available to help
you each business day from 8:00 a.m. to 4:00 p.m. (Central Time).
Please write or call:
Ameren Services Company, Investor Services
P.O. Box 66887
St. Louis, MO 63166-6887
314-554-3502
800-255-2237
invest@ameren.com
TRANSFER AGENT, REGISTRAR AND PAYING AGENT
The Transfer Agent, Registrar and Paying Agent for Ameren common
stock and Ameren Illinois Company and Union Electric Company
preferred stock is Ameren Services Company.
Ameren Corporation
One Ameren Plaza
1901 Chouteau Avenue
St. Louis, MO 63103
314-621-3222
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St. Louis, MO 63166-6149
www.ameren.com
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