Edgar Filing: AMEREN CORP

AEE-2015 Q1

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



ý	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended March 31, 2015



¨	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	Exact name of registrant as specified in its charter; State of Incorporation; Address and Telephone Number	IRS Employer Identification No.
1-14756	Ameren Corporation	43-1723446
	(Missouri Corporation)
	1901 Chouteau Avenue
	St. Louis, Missouri 63103
	(314) 621-3222

1-2967	Union Electric Company	43-0559760
	(Missouri Corporation)
	1901 Chouteau Avenue
	St. Louis, Missouri 63103
	(314) 621-3222

1-3672	Ameren Illinois Company	37-0211380
	(Illinois Corporation)
	6 Executive Drive
	Collinsville, Illinois 62234
	(618) 343-8150

Indicate by check mark 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	Yes	ý	No	¨
Union Electric Company	Yes	ý	No	¨
Ameren Illinois Company	Yes	ý	No	¨

Indicate by check mark 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	Yes	ý	No	¨
Union Electric Company	Yes	ý	No	¨
Ameren Illinois Company	Yes	ý	No	¨

Indicate by check mark 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.



	Large Accelerated Filer	Accelerated Filer	Non-Accelerated Filer	Smaller Reporting Company
Ameren Corporation	ý	¨	¨	¨
Union Electric Company	¨	¨	ý	¨
Ameren Illinois Company	¨	¨	ý	¨

Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).



Ameren Corporation	Yes	¨	No	ý
Union Electric Company	Yes	¨	No	ý
Ameren Illinois Company	Yes	¨	No	ý

The number of shares outstanding of each registrant’s classes of common stock as of April 30, 2015, was as follows:



Ameren Corporation		Common stock, $0.01 par value per share - 242,634,798
Union Electric Company		Common stock, $5 par value per share, held by Ameren Corporation - 102,123,834
Ameren Illinois Company		Common stock, no par value, held by Ameren Corporation - 25,452,373

______________________________________________________________________________________________________

This combined Form 10-Q is separately filed by Ameren Corporation, Union Electric Company, and Ameren Illinois Company. Each registrant hereto is filing on its own behalf all of the information contained in this quarterly 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



		Page
Glossary of Terms and Abbreviations		1

Forward-looking Statements		1

PART I Financial Information

Item 1.	Financial Statements (Unaudited)	3
	Ameren Corporation	3
	Consolidated Statement of Income	3
	Consolidated Statement of Comprehensive Income	4
	Consolidated Balance Sheet	5
	Consolidated Statement of Cash Flows	6
	Union Electric Company (d/b/a Ameren Missouri)	7
	Statement of Income and Comprehensive Income	7
	Balance Sheet	8
	Statement of Cash Flows	9
	Ameren Illinois Company (d/b/a Ameren Illinois)	10
	Statement of Income and Comprehensive Income	10
	Balance Sheet	11
	Statement of Cash Flows	12
	Combined Notes to Financial Statements	13
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	42
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	58
Item 4.	Controls and Procedures	59

PART II Other Information

Item 1.	Legal Proceedings	60
Item 1A.	Risk Factors	60
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	60
Item 6.	Exhibits	60

Signatures		62

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 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.

GLOSSARY OF TERMS AND ABBREVIATIONS

We use the words “our,” “we” or “us” with respect to certain information that relates to Ameren, Ameren Missouri, and Ameren Illinois, collectively. When appropriate, subsidiaries of Ameren Corporation are named specifically as their various business activities are discussed. Refer to the Form 10-K for a complete listing of glossary terms and abbreviations. Only new or significantly changed terms and abbreviations are included below.

Form 10-K - The combined Annual Report on Form 10-K for the year ended December 31, 2014, filed by the Ameren Companies with the SEC.

Net shared benefits - The value of the energy savings that are shared by Ameren Missouri and its customers under the MEEIA, net of the program costs to achieve those energy savings.

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 in the Form 10-K, 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:

•

regulatory, judicial, or legislative actions, including changes in regulatory policies and ratemaking determinations, such as the MoPSC’s April 2015 electric rate order; Ameren Missouri's December 2014 MEEIA filing; Ameren Illinois’ April 2015 annual electric delivery service formula update filing; Ameren Illinois' January 2015 natural gas delivery service rate case filing; a settlement agreement requiring FERC approval for an Ameren Illinois electric transmission rate refund and a prospective reduction to common equity for ratemaking purposes; the complaint cases filed with the FERC seeking a reduction in the allowed base return on common equity under the MISO tariff; and future regulatory, judicial, or legislative actions that seek to change regulatory recovery mechanisms;


•	the effect of Ameren Illinois participating in a performance-based formula ratemaking process under the IEIMA, including the direct relationship between Ameren Illinois' return on common equity and 30-year United States Treasury bond yields, 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;


•	our ability to align our overall spending, both operating and capital, with regulatory frameworks established by our regulators in an attempt to earn our allowed return on equity;


•	the effects of increased competition in the future due to, among other factors, deregulation of certain aspects of our business at either the state or federal level;


•	changes in laws and other governmental actions, including monetary, fiscal, tax, and energy policies;


•	the effects on demand for our services resulting from technological advances, including advances in customer energy efficiency and distributed generation sources, which generate electricity at the site of consumption;


•	the effectiveness of Ameren Missouri's customer energy efficiency programs, and the related amount of any net shared benefits and performance incentive earned under the current and proposed MEEIA plans;


•	the timing of increasing capital expenditure and operating expense requirements and our ability to recover these costs in a timely manner;


•	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 our ability to recover the costs for such commodities and our customers' tolerance for the related rate increases;


•	the effectiveness of our risk management strategies and our use of financial and derivative instruments;


•	business and economic conditions, including their impact on key customers, interest rates, collection of our receivable balances, and demand for our products;


•	disruptions of the capital markets, deterioration in credit metrics of the Ameren Companies, or other events that may have an adverse effect on the cost or availability of capital, including short-term credit and 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, including the impact of system outages;


•	the construction, installation, performance, and cost recovery of generation, transmission, and distribution assets;


•	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 claim against an insurer in connection with the December 2005 breach of the upper reservoir at the Taum Sauk pumped-storage hydroelectric energy center;


•	the extent to which Ameren Missouri is permitted by its regulators to recover in rates the investments it made in

connection with additional nuclear generation at its Callaway energy center;


•	operation of Ameren Missouri's Callaway energy center, including planned and unplanned outages, and decommissioning costs;


•	the effects of strategic initiatives, including mergers, acquisitions and divestitures, and any related tax implications;


•	the resolution of tax positions for years under examination by the IRS;

•

the impact of current environmental regulations and new, more stringent, or changing requirements, including those related to greenhouse gases, other emissions and discharges, 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 energy centers, increase our costs or investment requirements, result in an impairment of our assets, cause us to sell 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, work force reductions, future wage and employee benefits costs, including changes in discount rates, mortality tables, and returns on benefit plan assets;


•	the inability of our counterparties to meet their obligations with respect to contracts, credit agreements, and financial instruments;


•	the cost and availability of transmission capacity for the energy generated by Ameren Missouri's energy centers or required to satisfy Ameren Missouri's energy sales;


•	the inability of Dynegy and IPH to satisfy their indemnity and other obligations to Ameren in connection with the divestiture of New AER to IPH;


•	legal and administrative proceedings; and


•	acts of sabotage, war, terrorism, cyber attacks, or other intentionally disruptive acts.

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. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

AMEREN CORPORATION

CONSOLIDATED STATEMENT OF INCOME

(Unaudited) (In millions, except per share amounts)



	Three Months Ended March 31,
	2015		2014
Operating Revenues:
Electric	$	1,143	$	1,106
Gas	413		488
Total operating revenues	1,556		1,594
Operating Expenses:
Fuel	206		204
Purchased power	139		114
Gas purchased for resale	236		304
Other operations and maintenance	401		418
Depreciation and amortization	193		181
Taxes other than income taxes	125		127
Total operating expenses	1,300		1,348
Operating Income	256		246
Other Income and Expense:
Miscellaneous income	19		18
Miscellaneous expense	11		9
Total other income	8		9
Interest Charges	88		92
Income Before Income Taxes	176		163
Income Taxes	66		64
Income from Continuing Operations	110		99
Loss from Discontinued Operations, Net of Taxes (Note 12)	—		(1		)
Net Income	110		98
Less: Net Income from Continuing Operations Attributable to Noncontrolling Interests	2		2
Net Income (Loss) Attributable to Ameren Corporation:
Continuing Operations	108		97
Discontinued Operations	—		(1		)
Net Income Attributable to Ameren Corporation	$	108	$	96

Earnings per Common Share – Basic:
Continuing Operations	$	0.45	$	0.40
Discontinued Operations	—		—
Earnings per Common Share – Basic	$	0.45	$	0.40


Dividends per Common Share	$	0.41	$	0.40
Average Common Shares Outstanding – Basic	242.6		242.6

The accompanying notes are an integral part of these consolidated financial statements.

AMEREN CORPORATION

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Unaudited) (In millions)



	Three Months Ended March 31,
	2015		2014
Income from Continuing Operations	$	110	$	99
Other Comprehensive Income from Continuing Operations, Net of Taxes	—		—
Comprehensive Income from Continuing Operations	110		99
Less: Comprehensive Income from Continuing Operations Attributable to Noncontrolling Interests	2		2
Comprehensive Income from Continuing Operations Attributable to Ameren Corporation	108		97

Loss from Discontinued Operations, Net of Taxes	—		(1		)
Other Comprehensive Loss from Discontinued Operations, Net of Taxes	—		—
Comprehensive Loss from Discontinued Operations Attributable to Ameren Corporation	—		(1		)
Comprehensive Income Attributable to Ameren Corporation	$	108	$	96

The accompanying notes are an integral part of these consolidated financial statements.

AMEREN CORPORATION

CONSOLIDATED BALANCE SHEET

(Unaudited) (In millions, except per share amounts)



	March 31, 2015			December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	6		$	5
Accounts receivable – trade (less allowance for doubtful accounts of $23 and $21, respectively)	524			423
Unbilled revenue	212			265
Miscellaneous accounts and notes receivable	100			81
Materials and supplies	449			524
Current regulatory assets	265			295
Current accumulated deferred income taxes, net	331			352
Other current assets	91			86
Assets of discontinued operations (Note 12)	15			15
Total current assets	1,993			2,046
Property and Plant, Net	17,700			17,424
Investments and Other Assets:
Nuclear decommissioning trust fund	558			549
Goodwill	411			411
Regulatory assets	1,577			1,582
Other assets	645			664
Total investments and other assets	3,191			3,206
TOTAL ASSETS	$	22,884		$	22,676
LIABILITIES AND EQUITY
Current Liabilities:
Current maturities of long-term debt	$	380		$	120
Short-term debt	955			714
Accounts and wages payable	434			711
Taxes accrued	79			46
Interest accrued	94			85
Current regulatory liabilities	107			106
Other current liabilities	437			434
Liabilities of discontinued operations (Note 12)	34			33
Total current liabilities	2,520			2,249
Long-term Debt, Net	5,860			6,120
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net	3,964			3,923
Accumulated deferred investment tax credits	65			64
Regulatory liabilities	1,897			1,850
Asset retirement obligations	500			396
Pension and other postretirement benefits	708			705
Other deferred credits and liabilities	524			514
Total deferred credits and other liabilities	7,658			7,452
Commitments and Contingencies (Notes 2, 9, 10 and 12)
Ameren Corporation Stockholders’ Equity:
Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 242.6	2			2
Other paid-in capital, principally premium on common stock	5,600			5,617
Retained earnings	1,111			1,103
Accumulated other comprehensive loss	(9		)	(9		)
Total Ameren Corporation stockholders’ equity	6,704			6,713
Noncontrolling Interests	142			142
Total equity	6,846			6,855
TOTAL LIABILITIES AND EQUITY	$	22,884		$	22,676

The accompanying notes are an integral part of these consolidated financial statements.



AMEREN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
	Three Months Ended March 31,
	2015			2014
Cash Flows From Operating Activities:
Net income	$	110		$	98
Loss from discontinued operations, net of taxes	—			1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	195			176
Amortization of nuclear fuel	23			24
Amortization of debt issuance costs and premium/discounts	5			5
Deferred income taxes and investment tax credits, net	59			84
Allowance for equity funds used during construction	(5		)	(7		)
Stock-based compensation costs	8			9
Other	(11		)	(1		)
Changes in assets and liabilities:
Receivables	(48		)	(86		)
Materials and supplies	75			102
Accounts and wages payable	(215		)	(183		)
Taxes accrued	33			18
Regulatory assets and liabilities	62			(40		)
Assets, other	14			10
Liabilities, other	(33		)	(11		)
Pension and other postretirement benefits	27			30
Counterparty collateral, net	(2		)	10
Net cash provided by operating activities – continuing operations	297			239
Net cash provided by operating activities – discontinued operations	1			—
Net cash provided by operating activities	298			239
Cash Flows From Investing Activities:
Capital expenditures	(417		)	(442		)
Nuclear fuel expenditures	(17		)	(10		)
Purchases of securities – nuclear decommissioning trust fund	(84		)	(186		)
Sales and maturities of securities – nuclear decommissioning trust fund	79			182
Proceeds from note receivable – Marketing Company	5			56
Contributions to note receivable – Marketing Company	(5		)	(65		)
Net cash used in investing activities – continuing operations	(439		)	(465		)
Net cash provided by investing activities – discontinued operations	—			152
Net cash used in investing activities	(439		)	(313		)
Cash Flows From Financing Activities:
Dividends on common stock	(99		)	(97		)
Dividends paid to noncontrolling interest holders	(2		)	(2		)
Short-term debt, net	241			332
Redemptions of long-term debt	—			(163		)
Other	2			—
Net cash provided by financing activities – continuing operations	142			70
Net cash used in financing activities – discontinued operations	—			—
Net cash provided by financing activities	142			70
Net change in cash and cash equivalents	1			(4		)
Cash and cash equivalents at beginning of year	5			30
Cash and cash equivalents at end of period	$	6		$	26

The accompanying notes are an integral part of these consolidated financial statements.

UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)

STATEMENT OF INCOME AND COMPREHENSIVE INCOME

(Unaudited) (In millions)



	Three Months Ended March 31,
	2015		2014
Operating Revenues:
Electric	$	742	$	749
Gas	58		68
Total operating revenues	800		817
Operating Expenses:
Fuel	206		204
Purchased power	39		35
Gas purchased for resale	31		40
Other operations and maintenance	211		225
Depreciation and amortization	118		116
Taxes other than income taxes	80		78
Total operating expenses	685		698
Operating Income	115		119
Other Income and Expense:
Miscellaneous income	11		14
Miscellaneous expense	3		4
Total other income	8		10
Interest Charges	55		52
Income Before Income Taxes	68		77
Income Taxes	26		29
Net Income	42		48
Other Comprehensive Income	—		—
Comprehensive Income	$	42	$	48


Net Income	$	42	$	48
Preferred Stock Dividends	1		1
Net Income Available to Common Stockholder	$	41	$	47

The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.

UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)

BALANCE SHEET

(Unaudited) (In millions, except per share amounts)



	March 31, 2015		December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	1	$	1
Accounts receivable – trade (less allowance for doubtful accounts of $8 and $8, respectively)	202		190
Accounts receivable – affiliates	3		65
Unbilled revenue	120		146
Miscellaneous accounts and notes receivable	42		35
Materials and supplies	361		347
Current regulatory assets	158		163
Other current assets	77		92
Total current assets	964		1,039
Property and Plant, Net	10,959		10,867
Investments and Other Assets:
Nuclear decommissioning trust fund	558		549
Regulatory assets	687		695
Other assets	387		391
Total investments and other assets	1,632		1,635
TOTAL ASSETS	$	13,555	$	13,541
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current maturities of long-term debt	$	380	$	120
Borrowings from money pool	61		—
Short-term debt	140		97
Accounts and wages payable	182		405
Accounts payable – affiliates	59		56
Taxes accrued	69		32
Interest accrued	51		58
Current regulatory liabilities	32		18
Other current liabilities	114		117
Total current liabilities	1,088		903
Long-term Debt, Net	3,619		3,879
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net	2,821		2,806
Accumulated deferred investment tax credits	62		61
Regulatory liabilities	1,169		1,147
Asset retirement obligations	493		389
Pension and other postretirement benefits	277		274
Other deferred credits and liabilities	32		30
Total deferred credits and other liabilities	4,854		4,707
Commitments and Contingencies (Notes 2, 8, 9 and 10)
Stockholders’ Equity:
Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding	511		511
Other paid-in capital, principally premium on common stock	1,784		1,569
Preferred stock	80		80
Retained earnings	1,619		1,892
Total stockholders’ equity	3,994		4,052
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	13,555	$	13,541

The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.

UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)

STATEMENT OF CASH FLOWS

(Unaudited) (In millions)



	Three Months Ended March 31,
	2015			2014
Cash Flows From Operating Activities:
Net income	$	42		$	48
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	121			112
Amortization of nuclear fuel	23			24
Amortization of debt issuance costs and premium/discounts	2			2
Deferred income taxes and investment tax credits, net	21			30
Allowance for equity funds used during construction	(4		)	(7		)
Changes in assets and liabilities:
Receivables	60			2
Materials and supplies	(14		)	14
Accounts and wages payable	(171		)	(153		)
Taxes accrued	40			30
Regulatory assets and liabilities	27			(28		)
Assets, other	3			5
Liabilities, other	(5		)	2
Pension and other postretirement benefits	12			15
Net cash provided by operating activities	157			96
Cash Flows From Investing Activities:
Capital expenditures	(145		)	(188		)
Nuclear fuel expenditures	(17		)	(10		)
Purchases of securities – nuclear decommissioning trust fund	(84		)	(186		)
Sales and maturities of securities – nuclear decommissioning trust fund	79			182
Other	(2		)	(2		)
Net cash used in investing activities	(169		)	(204		)
Cash Flows From Financing Activities:
Dividends on common stock	(315		)	(77		)
Dividends on preferred stock	(1		)	(1		)
Short-term debt, net	43			290
Money pool borrowings, net	61			(105		)
Capital contribution from parent	224			—
Net cash provided by financing activities	12			107
Net change in cash and cash equivalents	—			(1		)
Cash and cash equivalents at beginning of year	1			1
Cash and cash equivalents at end of period	$	1		$	—

The accompanying notes as they relate to Ameren Missouri are an integral part of these financial statements.

AMEREN ILLINOIS COMPANY (d/b/a AMEREN ILLINOIS)

STATEMENT OF INCOME AND COMPREHENSIVE INCOME

(Unaudited) (In millions)



	Three Months Ended March 31,
	2015			2014
Operating Revenues:
Electric	$	390		$	353
Gas	355			421
Total operating revenues	745			774
Operating Expenses:
Purchased power	102			81
Gas purchased for resale	205			264
Other operations and maintenance	202			200
Depreciation and amortization	73			63
Taxes other than income taxes	43			46
Total operating expenses	625			654
Operating Income	120			120
Other Income and Expense:
Miscellaneous income	7			3
Miscellaneous expense	5			4
Total other income (expense)	2			(1		)
Interest Charges	33			30
Income Before Income Taxes	89			89
Income Taxes	35			35
Net Income	54			54
Other Comprehensive Loss, Net of Taxes:
Pension and other postretirement benefit plan activity, net of income taxes (benefit) of $(1) and $(1), respectively	(1		)	(1		)
Comprehensive Income	$	53		$	53


Net Income	$	54		$	54
Preferred Stock Dividends	1			1
Net Income Available to Common Stockholder	$	53		$	53

The accompanying notes as they relate to Ameren Illinois are an integral part of these financial statements.

AMEREN ILLINOIS COMPANY (d/b/a AMEREN ILLINOIS)

BALANCE SHEET

(Unaudited) (In millions)



	March 31, 2015		December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	—	$	1
Advances to money pool	33		—
Accounts receivable – trade (less allowance for doubtful accounts of $15 and $13, respectively)	304		212
Accounts receivable – affiliates	5		22
Unbilled revenue	92		119
Miscellaneous accounts receivable	12		9
Materials and supplies	88		177
Current regulatory assets	105		129
Current accumulated deferred income taxes, net	159		160
Other current assets	13		15
Total current assets	811		844
Property and Plant, Net	6,272		6,165
Investments and Other Assets:
Goodwill	411		411
Regulatory assets	883		883
Other assets	79		78
Total investments and other assets	1,373		1,372
TOTAL ASSETS	$	8,456	$	8,381
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Short-term debt	$	—	$	32
Borrowings from money pool	—		15
Accounts and wages payable	193		207
Accounts payable – affiliates	49		50
Taxes accrued	41		17
Interest accrued	43		24
Customer deposits	76		77
Mark-to-market derivative liabilities	43		42
Current environmental remediation	46		52
Current regulatory liabilities	69		84
Other current liabilities	100		100
Total current liabilities	660		700
Long-term Debt, Net	2,241		2,241
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net	1,421		1,408
Regulatory liabilities	727		703
Pension and other postretirement benefits	278		277
Environmental remediation	200		199
Other deferred credits and liabilities	216		192
Total deferred credits and other liabilities	2,842		2,779
Commitments and Contingencies (Notes 2, 8 and 9)
Stockholders’ Equity:
Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding	—		—
Other paid-in capital	1,980		1,980
Preferred stock	62		62
Retained earnings	664		611
Accumulated other comprehensive income	7		8
Total stockholders’ equity	2,713		2,661
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	8,456	$	8,381

The accompanying notes as they relate to Ameren Illinois are an integral part of these financial statements.

AMEREN ILLINOIS COMPANY (d/b/a AMEREN ILLINOIS)

STATEMENT OF CASH FLOWS

(Unaudited) (In millions)



	Three Months Ended March 31,
	2015			2014
Cash Flows From Operating Activities:
Net income	$	54		$	54
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	72			62
Amortization of debt issuance costs and premium/discounts	4			3
Deferred income taxes and investment tax credits, net	13			36
Other	(3		)	(2		)
Changes in assets and liabilities:
Receivables	(41		)	(94		)
Materials and supplies	89			88
Accounts and wages payable	(11		)	14
Taxes accrued	24			(1		)
Regulatory assets and liabilities	33			(11		)
Assets, other	6			5
Liabilities, other	4			16
Pension and other postretirement benefits	11			10
Counterparty collateral, net	(1		)	12
Net cash provided by operating activities	254			192
Cash Flows From Investing Activities:
Capital expenditures	(174		)	(215		)
Money pool advances, net	(33		)	—
Other	—			1
Net cash used in investing activities	(207		)	(214		)
Cash Flows From Financing Activities:
Dividends on preferred stock	(1		)	(1		)
Short-term debt, net	(32		)	—
Money pool borrowings, net	(15		)	186
Redemptions of long-term debt	—			(163		)
Net cash provided by (used in) financing activities	(48		)	22
Net change in cash and cash equivalents	(1		)	—
Cash and cash equivalents at beginning of year	1			1
Cash and cash equivalents at end of period	$	—		$	1

The accompanying notes as they relate to Ameren Illinois are an integral part of these financial statements.

AMEREN CORPORATION (Consolidated)

UNION ELECTRIC COMPANY (d/b/a Ameren Missouri)

AMEREN ILLINOIS COMPANY (d/b/a Ameren Illinois)

COMBINED NOTES TO FINANCIAL STATEMENTS

(Unaudited)

March 31, 2015

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 the FERC. Ameren’s primary assets are its equity interests in its subsidiaries, including Ameren Missouri and Ameren Illinois. Ameren’s subsidiaries are separate, independent legal entities with separate businesses, assets, and liabilities. Dividends on Ameren’s common stock and the payment of 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 and in the Form 10-K.


•	Union Electric Company, doing business as 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 Company, doing business as Ameren Illinois, operates rate-regulated electric and natural gas transmission and distribution businesses in Illinois.

Ameren has various other subsidiaries that conduct activities such as the provision of shared services. Ameren also has a subsidiary, ATXI, that operates a FERC rate-regulated electric transmission business. ATXI is developing MISO-approved electric transmission projects, including the Illinois Rivers, Spoon River, and Mark Twain projects. Ameren is also pursuing reliability projects within Ameren Missouri's and Ameren Illinois' service territories as well as competitive electric transmission investment opportunities outside of these territories, including investments outside of MISO.

The operating results, assets, and liabilities of the Elgin, Gibson City, Grand Tower, Meredosia, and Hutsonville energy centers have been presented separately as discontinued operations for all periods presented in this report. Unless otherwise stated, these notes to Ameren’s financial statements exclude discontinued operations for all periods presented. See Note 12 - Divestiture Transactions and Discontinued Operations in this report for additional information regarding the discontinued operations presentation and Note 16 - Divestiture Transactions and Discontinued Operations under Part II, Item 8, of the Form 10-K for additional information regarding Ameren’s divestiture of New AER in December 2013.

The financial statements of Ameren are prepared on a consolidated basis, and therefore include the accounts of its majority-owned subsidiaries. All intercompany transactions have been eliminated. Ameren Missouri and Ameren Illinois have no subsidiaries, and therefore their financial statements are not prepared on a consolidated basis. 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 management to 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. The results of operations of an interim period may not give a true indication of results that may be expected for a full year. These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Form 10-K.

Asset Retirement Obligations

The following table provides a reconciliation of the beginning and ending carrying amount of AROs for the three months ended March 31, 2015:



	Ameren Missouri		Ameren Illinois^(a)		Ameren
Balance at December 31, 2014	$	389	$	7	$	396
Accretion in 2015^(b)	5		(c)		5
Change in estimates^(d)	99		(c)		99
Balance at March 31, 2015	$	493	$	7	$	500


(a)	Included in “Other deferred credits and liabilities” on the balance sheet.


(b)	Accretion expense was recorded as an increase to regulatory assets at Ameren Missouri and Ameren Illinois.


(c)	Less than $1 million.

(d)

The ARO increase also resulted in a corresponding increase recorded to “Property and Plant, Net.” Ameren Missouri’s estimates related to its Callaway energy center decommissioning costs changed to reflect increased costs from the 2015 cost study and funding analysis, extension of the estimated operating life until 2044, and a reduction in the discount rate assumption. See Note 10 - Callaway Energy Center for additional information.

In addition, during the second quarter of 2015, Ameren and Ameren Missouri each expect to record an increase to their ARO related to retirement costs for CCR storage facilities of between $90 million and $120 million, with a corresponding increase to “Property and Plant, Net.” This increase is a result of the EPA’s new regulations for the management and disposal of CCR, which were published in April 2015. See Note 9 - Commitments and Contingencies in this report for additional information.

Stock-based Compensation

A summary of nonvested performance share units at March 31, 2015, and changes during the three months ended March 31, 2015, under the 2006 Incentive Plan and the 2014 Incentive Plan are presented below:



	Number of Performance Share Units		Weighted-average Fair Value Per Performance Share Unit
Nonvested at January 1, 2015	1,162,377		$	35.35
Granted^(a)	566,332		52.88
Forfeitures	(1,944	)	34.75
Vested^(b)	(68,411	)	47.88
Nonvested at March 31, 2015	1,658,354		$	40.82


(a)	Performance share units granted to certain executive and nonexecutive officers and other eligible employees in 2015 under the 2014 Incentive Plan.


(b)	Performance share units vested due to the 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.

The fair value of each performance share unit awarded in 2015 under the 2014 Incentive Plan was determined to be $52.88, which was based on Ameren’s closing common share price of $46.13 at December 31, 2014, 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, 2015. The simulations can produce a greater fair value for the performance share unit than the applicable 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 1.10%, volatility of 12% to 18% for the peer group, and Ameren’s attainment of a three-year average earnings per share threshold during the performance period.

Excise Taxes

Ameren Missouri and Ameren Illinois collect certain excise taxes from customers that are levied on the sale or distribution of natural gas and electricity. Excise taxes are levied on Ameren Missouri’s electric and natural gas businesses and on Ameren Illinois’ natural gas business and are recorded gross in “Operating Revenues - Electric,” “Operating Revenues - Gas” and “Operating Expenses - Taxes other than income taxes” on the statement of income or the statement of income and comprehensive income. Excise taxes for electric service in Illinois are levied on the customer and are therefore not included in Ameren Illinois’ revenues and expenses. The following table presents excise taxes recorded in “Operating Revenues - Electric,” “Operating Revenues - Gas” and “Operating Expenses - Taxes other than income taxes” for the three months ended March 31, 2015 and 2014:



	Three Months
	2015		2014
Ameren Missouri	$	34	$	34
Ameren Illinois	23		26
Ameren	$	57	$	60

Uncertain Tax Positions

The following table presents the total amount of reserves for unrecognized tax benefits (detriments) related to uncertain tax positions as of March 31, 2015, and December 31, 2014:



	March 31, 2015			December 31, 2014
Ameren	$	53		$	54
Ameren Missouri	(1		)	—
Ameren Illinois	(1		)	(1		)

The following table presents the amount of reserves for unrecognized tax benefits, included in the table above, related to uncertain tax positions that, if recognized, would impact results of operations as of March 31, 2015, and December 31, 2014:



	March 31, 2015			December 31, 2014
Ameren	$	52		$	52
Ameren Missouri	(1		)	—
Ameren Illinois	(1		)	(1		)

In March 2015, a settlement was reached with the IRS for tax year 2012. Since there were no uncertain tax positions related to the 2012 tax year as of December 31, 2014, this settlement did not impact the amount of recorded unrecognized tax benefits.

Ameren’s federal income tax return for the tax year 2013 is currently under examination by the IRS. It is reasonably possible that a settlement will be reached with the IRS in the next 12 months, which will result in a reduction of Ameren’s unrecognized tax benefits of $53 million related to discontinued operations.

In addition, it is reasonably possible that other events will occur during the next 12 months that would cause the total amount of our unrecognized tax benefits to fluctuate. However, other than as described above, we do not believe any such fluctuations would be material to our results of operations, financial position, or liquidity.

State income tax returns are generally subject to examination for a period of three years after filing. We do not

currently have material state income tax issues under examination, administrative appeal, or litigation. 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.

Earnings Per Share

There were no material differences between Ameren’s basic and diluted earnings per share amounts for the three months ended March 31, 2015 and 2014. The assumed settlement of dilutive performance share units had an immaterial impact on earnings per share.

Accounting and Reporting Developments

Below is a summary of recently adopted or issued authoritative accounting guidance relevant to the Ameren Companies.

Presentation of Debt Issuance Costs

In April 2015, FASB issued authoritative accounting guidance to simplify the presentation of debt issuance costs. The guidance requires debt issuance costs to be presented in the balance sheet as a reduction to the associated debt liability. Currently, debt issuance costs are presented as a component of “Other assets” on the Ameren Companies’ balance sheets. The guidance will be effective for the Ameren Companies in the first quarter of 2016 and applied retrospectively. The guidance will not affect the Ameren Companies' results of operations, financial position, or liquidity, as this guidance is presentation-related only.

NOTE 2 - RATE AND REGULATORY MATTERS

Below is a summary of updates to significant regulatory proceedings and related lawsuits. See also Note 2 - Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K. 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

2015 Electric Rate Order

In April 2015, the MoPSC issued an order approving an increase in Ameren Missouri’s annual revenues for electric service of $122 million, including $109 million related to the increase in net energy costs above the net energy costs included in base rates previously authorized by the MoPSC. The remaining increase of $13 million approved by the order was for non-energy costs. The revenue increase was based on a 9.53% return on common equity, a capital structure composed of 51.8% common equity, and a rate base of $7.0 billion to reflect investments through December 31, 2014. Rate changes consistent with the order will become effective on May 30, 2015.

The order approved Ameren Missouri’s request for continued use of the FAC; however, it changed the FAC to

exclude substantially all transmission charges and revenues. In addition, the order did not approve the continued use of the regulatory tracking mechanisms for storm costs and vegetation management and infrastructure inspection costs. The order did approve the continued use of the regulatory tracking mechanisms for pension and postretirement benefits, renewable energy standard cost, solar rebates, and uncertain tax positions that the MoPSC authorized in earlier electric rate orders.

In addition, the order approved a reduction to Noranda’s electric rates with an offsetting increase in electric rates for Ameren Missouri’s other customers. The rate shift will be revenue neutral to Ameren Missouri. Ameren Missouri supplies electricity to Noranda’s aluminum smelter in southeast Missouri under a 15-year agreement, which is subject to termination as early as May 31, 2020, and on each May 31 thereafter, upon at least five years notice by either party. Termination of the agreement by Ameren Missouri would require MoPSC approval.

Ameren Missouri will request a rehearing on several aspects of the MoPSC’s order, including the allowed return on common equity and the elimination of recovery of changes in transmission charges and revenues through the FAC. The MoOPC and the intervenor parties in this case may similarly seek rehearing or subsequently appeal any aspect of the order. Ameren Missouri cannot predict whether any such application for rehearing or appeal will be filed, or the outcome if so filed.

Accounting Authority Order

In November 2013, the MoPSC issued an accounting authority order that allowed Ameren Missouri to seek recovery of fixed costs totaling $36 million that were not previously recovered from Noranda as a result of the loss of load caused by a severe 2009 ice storm in a future electric rate case. In its April 2015 electric rate order, the MoPSC did not approve recovery of these fixed costs. Ameren Missouri had not recorded any revenue associated with this accounting authority order and will not record a charge to earnings based on the outcome of the MoPSC’s April 2015 electric rate order.

MEEIA Filing

In December 2014, Ameren Missouri filed an energy efficiency plan with the MoPSC under the MEEIA. This filing proposed a three-year plan that includes a portfolio of customer energy efficiency programs along with a cost recovery mechanism. If the plan is approved, beginning in January 2016, Ameren Missouri intends to invest $135 million over three years in the proposed customer energy efficiency programs. Ameren Missouri requested continued use of a MEEIA rider, which allows it to collect from or refund to customers any difference in the actual amounts incurred and the amounts collected from customers for the MEEIA program costs and net shared benefits. In addition, Ameren Missouri requested incentives to earn additional revenues by achieving certain customer energy efficiency goals, including $25 million if 100% of its customer energy efficiency goals are achieved during the three-year period. Ameren Missouri must achieve at least 70% of its

customer energy efficiency goals before it earns any incentive award.

Illinois

IEIMA

Under the provisions of the IEIMA, Ameren Illinois’ electric delivery service rates are subject to an annual revenue requirement reconciliation to its actual costs.Throughout each year, Ameren Illinois records a regulatory asset or a regulatory liability and a corresponding increase or decrease to operating revenues for any differences between the revenue requirement reflected in customer rates for that year and its estimate of the probable increase or decrease in the revenue requirement expected to ultimately be approved by the ICC based on that year's actual costs incurred. As of March 31, 2015, Ameren Illinois had recorded regulatory assets of $8 million, $101 million, and $52 million, to reflect its expected 2015, 2014 and 2013 revenue requirement reconciliation adjustments, with interest, respectively. Ameren Illinois is collecting the 2013 revenue requirement reconciliation adjustment from customers during 2015.

In April 2015, Ameren Illinois filed with the ICC its annual electric delivery service formula rate update to establish the revenue requirement used for 2016 rates. Pending ICC approval, Ameren Illinois’ update filing will result in a $110 million increase in Ameren Illinois’ electric delivery service revenue requirement, beginning in January 2016. This update reflects an increase to the annual formula rate based on 2014 actual costs and expected net plant additions for 2015, an increase to include the 2014 revenue requirement reconciliation adjustment, and a decrease for the conclusion of the 2013 revenue requirement reconciliation adjustment, which will be fully collected from customers in 2015.

In April 2015, the IEIMA’s formula rate framework was extended until the end of 2019, with further extensions possible through 2022.

2015 Natural Gas Delivery Service Rate Case

In January 2015, Ameren Illinois filed a request with the ICC seeking approval to increase its annual revenues for natural gas delivery service by $53 million. The request was based on a 10.25% return on common equity, a capital structure composed of 50% common equity, and a rate base of $1.2 billion. In an attempt to reduce regulatory lag, Ameren Illinois used a 2016 future test year in this proceeding. Included in the request was a proposal to implement a decoupling rider mechanism for residential and small nonresidential customers. The decoupling rider would ensure that changes in natural gas sales volumes do not affect Ameren Illinois' annual natural gas revenues for these rate classes.

A decision by the ICC in this proceeding is required by December 2015, with new rates expected to be effective in January 2016. Ameren Illinois cannot predict the level of any delivery service rate changes the ICC may approve, whether the

ICC will approve the decoupling rider, or whether any rate changes that may eventually be approved will be sufficient to enable Ameren Illinois to recover its costs and to earn a reasonable return on investments when the rate changes go into effect.

2013 Natural Gas Delivery Service Rate Order

In December 2013, the ICC issued a rate order that approved an increase in Ameren Illinois’ revenues for natural gas delivery service based on a 9.1% return on common equity. The rate changes became effective January 1, 2014. In March 2014, Ameren Illinois filed with the Appellate Court of the Fourth District of Illinois an appeal of the allowed return on common equity included in the ICC's order. Ameren Illinois sought a 10.4% return on common equity in this rate case. A decision is expected in 2015.

2015 ICC Purchased Power Reconciliation

In January 2015, the ICC issued an order that approved Ameren Illinois' reconciliation of revenues collected under its purchased power rider mechanism and Ameren Illinois' related cumulative power usage cost. In the first quarter of 2015, based on the January 2015 order, both Ameren and Ameren Illinois recorded a $15 million increase to electric revenues for the recovery of this cumulative power usage cost from electric customers.

ATXI Transmission Project

In August 2014, ATXI made a filing with the ICC requesting a certificate of public convenience and necessity and project approval for the Spoon River project, a MISO-approved transmission line project located in northwest Illinois. A decision is expected from the ICC in 2015. A certificate of public convenience and necessity is required before ATXI can proceed with right-of-way acquisition.

Federal

Ameren Illinois Electric Transmission Rate Refund

In July 2012, the FERC issued an order concluding that Ameren Illinois improperly included acquisition premiums, including goodwill, in determining the common equity used in its electric transmission formula rate and thereby inappropriately recovered a higher amount from its electric transmission customers. The order required Ameren Illinois to make refunds to customers for such improperly included amounts.

Ameren Illinois submitted a refund report in November 2012, which concluded that no refund was warranted. Several wholesale customers filed a protest with the FERC regarding that conclusion. In June 2013, the FERC issued an order that rejected Ameren Illinois' November 2012 refund report and provided guidance as to the filing of a new refund report. In July 2013, Ameren Illinois filed a revised refund report based on the guidance provided in the June 2013 order, which also concluded that no refund was warranted. In June 2014, the FERC issued an

order establishing settlement procedures and, if necessary, hearing procedures regarding Ameren Illinois’ July 2013 refund report.

In March 2015, Ameren Illinois reached a settlement agreement with the wholesale customers that resolves the issues in this proceeding. The settlement agreement requires FERC approval. Upon approval by the FERC, the settlement agreement will require Ameren Illinois to make refunds and payments of $8 million to transmission customers. It will also require Ameren Illinois to take other actions, such as reducing common equity for electric transmission ratemaking purposes on a prospective basis. There is no date by which the FERC must act with respect to the settlement agreement. Ameren Illinois estimates the maximum refund obligation through March 31, 2015, to be $23 million. Ameren Illinois’ March 31, 2015 and December 31, 2014 balance sheets included an $8 million and a $7 million current liability, respectively, for its estimate of the probable refund to transmission customers. If Ameren Illinois were to determine that a refund to its electric transmission customers in excess of the amount already recorded is probable, an additional charge to earnings would be recorded in the period in which that determination was made.

FERC Complaint Cases

Currently, the FERC-allowed base return on common equity for MISO transmission owners is 12.38%. In November 2013, a customer group filed a complaint case with the FERC seeking a reduction in the allowed base return on common equity for the FERC-regulated MISO transmission rate base under the MISO tariff to 9.15%. The FERC scheduled the case for hearing proceedings, requiring an initial decision to be issued no later than November 30, 2015. As the maximum FERC-allowed refund period for the November 2013 complaint case ended in February 2015, another customer complaint case was filed in February 2015. The February 2015 complaint case seeks a reduction in the allowed base return on common equity for the FERC-regulated MISO transmission rate base under the MISO tariff to 8.67%.

In 2014, the FERC issued orders in a proceeding, in which the Ameren Companies were not involved, reducing the allowed base return on common equity for New England transmission owners from 11.14% to 10.57%, with rate incentives allowed up to 11.74%. The FERC order in the New England transmission owners’ case applied observable market data from October 2012 to March 2013 to determine the allowed base return on common equity. The evidence and the calculation used in the New England transmission owners’ case may guide the FERC’s decision in the MISO complaint cases discussed above. The FERC calculation will establish the allowed base return on common equity, which specifies a unique time period for each complaint case, and will require multiple inputs based on observable market data specific to the utility industry and broader macroeconomic data. In January 2015, the settlement judge for the initial MISO complaint case ordered that July 13, 2015, be the cut-off date for the observable market data to be used in the calculation of the allowed base return on common equity. Based

on the information in these orders, Ameren and Ameren Illinois recorded current liabilities on their respective balance sheets as of March 31, 2015, and December 31, 2014, representing their estimate of the refunds from the refund effective date of November 12, 2013, through the respective balance sheet date. A 50 basis point reduction in the FERC-allowed return on common equity would reduce Ameren's and Ameren Illinois' 2015 earnings by an estimated $4 million and $2 million, respectively, based on 2015 projected rate base. Ameren Missouri did not record a liability as of March 31, 2015, and does not expect that a reduction in the FERC-allowed base return on common equity for MISO transmission owners would be material to its results of operations, financial position, or liquidity.

Based on a November 2014 request, the FERC approved an incentive adder of up to 50 basis points on the allowed base return on common equity for our participation in an RTO. The incentive adder became effective on January 6, 2015. The FERC also approved our request to defer collection of the incentive adder until the issuance of the final order addressing the initial MISO complaint case.

Ameren Missouri Power Purchase Agreement with Entergy

Beginning in 2005, the FERC issued a series of orders addressing a complaint filed in 2001 by the Louisiana Public Service Commission against 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, which expired August 31, 2009. In May 2012, the FERC issued an order stating that Entergy should not have included additional charges to Ameren Missouri under the power purchase agreement. Pursuant to the order, in June 2012, Entergy paid Ameren Missouri $31 million. In November 2013, Entergy filed an appeal of the FERC's May 2012 order with the United States Court of Appeals for the District of Columbia Circuit. In March 2015, the United States Court of Appeals for the District of Columbia Circuit upheld the FERC’s May 2012 order. Ameren Missouri believes the outstanding issues relating to its power purchase agreement with Entergy have been resolved and will not result in a charge to earnings.

Combined Construction and Operating License

In 2008, Ameren Missouri filed an application with the NRC for a COL for a new nuclear unit at Ameren Missouri's existing Callaway County, Missouri, energy center site. In 2009, Ameren Missouri suspended its efforts to build a new nuclear unit at the Callaway site, and the NRC suspended review of the COL application. The suspended status of the COL application currently extends through the end of 2015.

Ameren Missouri estimates the total cost to obtain a COL for the Callaway site to be approximately $100 million. As of March 31, 2015, Ameren Missouri had capitalized investments of $69 million for the development of a new nuclear energy center. Ameren is currently evaluating all potential nuclear technologies in order to maintain an option for nuclear power in the future.

All of Ameren Missouri's capitalized investments for the development of a new nuclear energy center will remain capitalized while management pursues options to maximize the value of its investment. If efforts to license additional nuclear generation are abandoned, if the NRC does not extend the COL

application suspended status, or if management concludes it is probable that the costs incurred will be disallowed in rates, a charge to earnings would be recognized in the period in which that determination is made.

NOTE 3 - SHORT-TERM DEBT AND LIQUIDITY

The liquidity needs of the Ameren Companies are typically supported through the use of available cash, drawings under committed credit agreements, commercial paper issuances, or, in the case of Ameren Missouri and Ameren Illinois, short-term intercompany borrowings.

The 2012 Missouri Credit Agreement and the 2012 Illinois Credit Agreement, both of which expire on December 11, 2019, were not utilized for direct borrowings during the three months ended March 31, 2015, but were used to support commercial paper issuances and to issue letters of credit. Based on letters of credit issued under the 2012 Credit Agreements, as well as commercial paper outstanding, the aggregate amount of credit capacity available under the 2012 Credit Agreements to Ameren (parent), Ameren Missouri, and Ameren Illinois, collectively, at March 31, 2015, was $1.1 billion.

Commercial Paper

The following table presents commercial paper outstanding at Ameren (parent), Ameren Missouri, and Ameren Illinois as of March 31, 2015, and December 31, 2014.



	March 31, 2015		December 31, 2014
Ameren (parent)	$	815	$	585
Ameren Missouri	140		97
Ameren Illinois	—		32
Ameren Consolidated	$	955	$	714

The following table summarizes the commercial paper activity and relevant interest rates under Ameren’s (parent), Ameren Missouri’s, and Ameren Illinois’ commercial paper programs for the three months ended March 31, 2015 and 2014. Ameren Illinois established a commercial paper program in May 2014.



	Ameren (parent)			Ameren Missouri			Ameren Illinois			Ameren Consolidated
2015
Average daily commercial paper outstanding	$	691		$	151		$	10		$	852
Weighted-average interest rate	0.55		%	0.49		%	0.44		%	0.53		%
Peak commercial paper during period^(a)	$	815		$	243		$	39		$	955
Peak interest rate	0.70		%	0.60		%	0.60		%	0.70		%
2014
Average daily commercial paper outstanding	$	339		$	200		$	—		$	539
Weighted-average interest rate	0.45		%	0.45		%	—		%	0.45		%
Peak commercial paper during period^(a)	$	452		$	290		$	—		$	700
Peak interest rate	0.75		%	0.70		%	—		%	0.75		%


(a)	The timing of peak commercial paper issuances varies by company, and therefore the peak amounts presented by company might not equal the Ameren Consolidated peak commercial paper issuances for the period.

Indebtedness Provisions and Other Covenants

The information below is a summary of the Ameren Companies’ compliance with indebtedness provisions and other covenants within the 2012 Credit Agreements. See Note 4 - Short-term Debt and Liquidity under Part II, Item 8, in the Form 10-K for a detailed description of these provisions.

The 2012 Credit Agreements 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 2012 Credit Agreements require each of Ameren,

Ameren Missouri, and Ameren Illinois 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 March 31, 2015, the ratios of consolidated indebtedness to total consolidated capitalization, calculated in accordance with the provisions of the 2012 Credit Agreements, were 51%, 50%, and 46%, for Ameren, Ameren Missouri, and Ameren Illinois, respectively. In addition, under the 2012 Illinois Credit Agreement and, by virtue of the cross-default provisions of the 2012 Missouri Credit Agreement, under the 2012 Missouri Credit Agreement, Ameren is required to maintain a ratio of consolidated funds from operations plus interest expense to consolidated interest expense of at least 2.0 to 1.0. However, the interest coverage requirement only applies at such times as

Ameren does not have a senior long-term unsecured credit rating of at least Baa3 from Moody’s or BBB- from S&P. As of March 31, 2015, Ameren exceeded the rating requirements; therefore, the interest coverage requirement was not applicable. Failure of a borrower to satisfy a financial covenant constitutes an immediate default under the applicable 2012 Credit Agreement.

The 2012 Credit Agreements contain default provisions that apply separately to each borrower; provided, however, that a default of Ameren Missouri or Ameren Illinois under the applicable 2012 Credit Agreement will also be deemed to constitute a default of Ameren under such agreement. Defaults include a cross-default of such borrower under any other agreement covering outstanding indebtedness of such borrower and certain subsidiaries (other than project finance subsidiaries and nonmaterial subsidiaries) in excess of $75 million in the aggregate (including under the other 2012 Credit Agreement). However, under the default provisions of the 2012 Credit Agreements, any default of Ameren under any 2012 Credit Agreement that results solely from a default of Ameren Missouri or Ameren Illinois thereunder does not result in a cross-default of Ameren under the other 2012 Credit Agreement. Further, the 2012 Credit Agreement default provisions provide that an Ameren default under any of the 2012 Credit Agreements does not constitute a default by Ameren Missouri or Ameren Illinois.

None of the Ameren Companies' credit agreements or financing arrangements contain credit rating triggers that would cause a default or acceleration of repayment of outstanding balances. The Ameren Companies were in compliance with the provisions and covenants of their credit agreements at March 31, 2015.

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.

Ameren Missouri, Ameren Illinois, and Ameren Services may participate in the utility money pool as both lenders and borrowers. Ameren may participate in the utility money pool only as a lender. Surplus internal funds are contributed to the utility money pool from participants. The primary sources of external funds for the utility money pool are the 2012 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 made by participants, but is 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. 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. The average interest rate for borrowing under the utility money pool for the three months ended March 31, 2015 and 2014, was 0.08% and 0.39%, respectively.

See Note 8 - Related Party Transactions for the amount of interest income and expense from the money pool arrangements recorded by the Ameren Companies for the three months ended March 31, 2015 and 2014.

NOTE 4 - LONG-TERM DEBT AND EQUITY

Ameren Missouri

In March 2015, Ameren Missouri received cash capital contributions of $224 million from Ameren (parent).

In April 2015, Ameren Missouri issued $250 million of 3.65% senior secured notes due April 15, 2045, with interest payable semiannually on April 15 and October 15 of each year, beginning October 15, 2015. Ameren Missouri received proceeds of $247 million, which were used to repay outstanding short-term debt, including short-term debt that Ameren Missouri incurred in connection with the repayment of $114 million of its 4.75% senior secured notes that matured on April 1, 2015.

Indenture Provisions and Other Covenants

Ameren Missouri’s and Ameren Illinois’ indentures, credit facilities, 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. 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 March 31, 2015, at an assumed annual interest rate of 5% and dividend rate of 6%.



	Required Interest Coverage Ratio^(a)	Actual Interest Coverage Ratio		Bonds Issuable^(b)		Required Dividend Coverage Ratio^(c)	Actual Dividend Coverage Ratio		Preferred Stock Issuable
Ameren Missouri	≥2.0	4.6	$	3,386		≥2.5	113.4	$	2,530
Ameren Illinois	≥2.0	6.6		3,423	^(d)	≥1.5	2.8		203	^(e)


(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 $832 million and $204 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. The amount of bonds issuable by Ameren Illinois is also subject to the lien restrictions contained in the 2012 Illinois Credit Agreement.


(e)	Preferred stock issuable is restricted by the amount of preferred stock that is currently authorized by Ameren Illinois’ articles of incorporation.

Ameren Missouri and Ameren Illinois and certain other 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 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 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.

Ameren Illinois’ articles of incorporation require dividend payments on its 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 the FERC to maintain a minimum of 30% equity in its capital structure. As of March 31, 2015, Ameren Illinois had 54% of equity in its capital structure.

In order for the Ameren Companies to issue securities in the future, we have to comply with all applicable requirements in effect at the time of any such issuances.

Off-Balance-Sheet Arrangements

At March 31, 2015, 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. See Note 12 - Divestiture Transactions and Discontinued Operations for Ameren (parent) guarantees and letters of credit issued to support New AER based on the transaction agreement with IPH.

NOTE 5 - OTHER INCOME AND EXPENSES

The following table presents the components of “Other Income and Expenses” in the Ameren Companies’ statements of income for the three months ended March 31, 2015 and 2014:



	Three Months
	2015		2014
Ameren:^(a)
Miscellaneous income:
Allowance for equity funds used during construction	$	5	$	7
Interest income on industrial development revenue bonds	7		7
Interest income	4		2
Other	3		2
Total miscellaneous income	$	19	$	18
Miscellaneous expense:
Donations	$	8	$	5
Other	3		4
Total miscellaneous expense	$	11	$	9
Ameren Missouri:
Miscellaneous income:
Allowance for equity funds used during construction	$	4	$	7
Interest income on industrial development revenue bonds	7		7
Total miscellaneous income	$	11	$	14
Miscellaneous expense:
Donations	$	2	$	2
Other	1		2
Total miscellaneous expense	$	3	$	4
Ameren Illinois:
Miscellaneous income:
Allowance for equity funds used during construction	$	1	$	—
Interest income	4		2
Other	2		1
Total miscellaneous income	$	7	$	3
Miscellaneous expense:
Donations	$	3	$	3
Other	2		1
Total miscellaneous expense	$	5	$	4


(a)	Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.

NOTE 6 - DERIVATIVE FINANCIAL INSTRUMENTS

We use derivatives to manage the risk of changes in market prices for natural gas, power, and uranium, as well as the risk of changes in rail transportation surcharges through fuel oil hedges. 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 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 commodity contract volumes by commodity type for derivative assets and liabilities as of March 31, 2015, and December 31, 2014. As of March 31, 2015, these contracts ran through October 2017, October 2019, May 2032, and October 2016 for fuel oils, natural gas, power, and uranium, respectively.



	Quantity (in millions, except as indicated)
	2015			2014
Commodity	Ameren Missouri	Ameren Illinois	Ameren	Ameren Missouri	Ameren Illinois	Ameren
Fuel oils (in gallons)^(a)	40	(b)	40	50	(b)	50
Natural gas (in mmbtu)	29	121	150	28	108	136
Power (in megawatthours)	1	10	11	1	11	12
Uranium (pounds in thousands)	349	(b)	349	332	(b)	332


(a)	Fuel oils consist of heating oil and ultra-low-sulfur diesel.


(b)	Not applicable.

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 7 - Fair Value Measurements for discussion of our methods of assessing the fair value of derivative instruments. Many of our physical contracts, such as our purchased power contracts, qualify for the NPNS exception to derivative accounting rules. The revenue or expense on 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. We also consider whether gains or losses resulting from such derivatives qualify for regulatory deferral. 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. We believe derivative losses and gains 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. As of March 31, 2015, and December 31, 2014, all contracts that qualify for hedge accounting received regulatory deferral.

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 a master netting arrangement. The Ameren Companies did not elect to adopt this guidance for any eligible commodity contracts.

The following table presents the carrying value and balance sheet location of all derivative commodity contracts, none of which were designated as hedging instruments, as of March 31, 2015, and December 31, 2014:



	Balance Sheet Location	Ameren Missouri		Ameren Illinois		Ameren
2015
Fuel oils	Other current assets	$	1	$	—	$	1
Natural gas	Other current assets	—		1		1
Power	Other current assets	7		—		7
	Total assets	$	8	$	1	$	9
Fuel oils	Other current liabilities	$	21	$	—	$	21
	Other deferred credits and liabilities	7		—		7
Natural gas	MTM derivative liabilities	(a)		32		(a)
	Other current liabilities	6		—		38
	Other deferred credits and liabilities	8		18		26
Power	MTM derivative liabilities	(a)		11		(a)
	Other current liabilities	1		—		12
	Other deferred credits and liabilities	—		153		153
Uranium	Other current liabilities	1		—		1
	Total liabilities	$	44	$	214	$	258
2014
Fuel oils	Other current assets	$	2	$	—	$	2
Natural gas	Other current assets	1		1		2
Power	Other current assets	15		—		15
	Total assets	$	18	$	1	$	19
Fuel oils	Other current liabilities	$	22	$	—	$	22
	Other deferred credits and liabilities	7		—		7
Natural gas	MTM derivative liabilities	(a)		31		(a)
	Other current liabilities	6		—		37
	Other deferred credits and liabilities	6		13		19
Power	MTM derivative liabilities	(a)		11		(a)
	Other current liabilities	3		—		14
	Other deferred credits and liabilities	—		131		131
Uranium	Other current liabilities	2		—		2
	Total liabilities	$	46	$	186	$	232


(a)	Balance sheet line item not applicable to registrant.

The following table presents the cumulative amount of pretax net gains (losses) on all derivative instruments deferred in regulatory assets or regulatory liabilities as of March 31, 2015, and December 31, 2014:



	Ameren Missouri			Ameren Illinois			Ameren
2015
Fuel oils derivative contracts^(a)	$	(27	)	$	—		$	(27	)
Natural gas derivative contracts^(b)	(14		)	(49		)	(63		)
Power derivative contracts^(c)	6			(164		)	(158		)
Uranium derivative contracts^(d)	(1		)	—			(1		)
2014
Fuel oils derivative contracts	$	(29	)	$	—		$	(29	)
Natural gas derivative contracts	(11		)	(43		)	(54		)
Power derivative contracts	12			(142		)	(130		)
Uranium derivative contracts	(2		)	—			(2		)


(a)	Represents net losses associated with fuel oils derivative contracts at Ameren Missouri. These contracts are a partial hedge of Ameren Missouri’s rail transportation surcharges for coal through December 2017. Current losses deferred as regulatory assets include $20 million at Ameren and Ameren Missouri.

(b)

Represents net losses associated with natural gas derivative contracts. These contracts are a partial hedge of natural gas requirements through October 2019 at Ameren and Ameren Missouri and through October 2018 at Ameren Illinois. Current gains deferred as regulatory liabilities include $1 million at Ameren and Ameren Illinois, respectively. Current losses deferred as regulatory assets include $38 million, $6 million, and $32 million at Ameren, Ameren Missouri, and Ameren Illinois, respectively.

(c)

Represents net gains (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 2016 at Ameren Missouri. Current gains deferred as regulatory liabilities include $7 million at Ameren and Ameren Missouri. Current losses deferred as regulatory assets include $12 million, $1 million, and $11 million at Ameren, Ameren Missouri, and Ameren Illinois, respectively.


(d)	Represents net losses on uranium derivative contracts at Ameren Missouri. These contracts are a partial hedge of Ameren Missouri’s uranium requirements through December 2016. Current losses deferred as regulatory assets include $1 million at Ameren and Ameren Missouri.

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 netting arrangements, and reporting daily exposure to senior management.

We believe that entering into master netting arrangements 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 netting arrangements: (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 netting arrangements allow the counterparties to net settle sale and purchase transactions. Further, collateral requirements are calculated at the master netting arrangement level by counterparty.

The following table provides the recognized gross derivative balances and the net amounts of those derivatives subject to an enforceable master netting arrangement or similar agreement as of March 31, 2015, and December 31, 2014:



			Gross Amounts Not Offset in the Balance Sheet
Commodity Contracts Eligible to be Offset	Gross Amounts Recognized in the Balance Sheet		Derivative Instruments		Cash Collateral Received/Posted^(a)		Net Amount
2015
Assets:
Ameren Missouri	$	8	$	4	$	—	$	4
Ameren Illinois	1		—		—		1
Ameren	$	9	$	4