Edgar Filing: Ameren Illinois Co

Form 10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

for the Quarterly Period Ended March 31, 2011

¨	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)
	300 Liberty Street
	Peoria, Illinois 61602
	(309) 677-5271

333-56594	Ameren Energy Generating Company	37-1395586
	(Illinois Corporation)
	1901 Chouteau Avenue
	St. Louis, Missouri 63103
	(314) 621-3222

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	x	No	¨
Union Electric Company	Yes	x	No	¨
Ameren Illinois Company	Yes	x	No	¨
Ameren Energy Generating Company	Yes	x	No	¨

Indicate by check mark whether each registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).


Ameren Corporation	Yes	x	No	¨
Union Electric Company	Yes	¨	No	¨
Ameren Illinois Company	Yes	¨	No	¨
Ameren Energy Generating Company	Yes	¨	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 Securities Exchange Act of 1934.


	Large Accelerated Filer	Accelerated Filer	Non-Accelerated Filer	Smaller Reporting Company
Ameren Corporation	x	¨	¨	¨
Union Electric Company	¨	¨	x	¨
Ameren Illinois Company	¨	¨	x	¨
Ameren Energy Generating Company	¨	¨	x	¨

Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934).


Ameren Corporation	Yes	¨	No	x
Union Electric Company	Yes	¨	No	x
Ameren Illinois Company	Yes	¨	No	x
Ameren Energy Generating Company	Yes	¨	No	x

The number of shares outstanding of each registrant’s classes of common stock as of April 29, 2011, was as follows:


Ameren Corporation		Common stock, $0.01 par value per share - 241,148,657

Union Electric Company		Common stock, $5 par value per share, held by Ameren Corporation (parent company of the registrant) - 102,123,834

Ameren Illinois Company		Common stock, no par value, held by Ameren Corporation (parent company of the registrant) - 25,452,373

Ameren Energy Generating Company		Common stock, no par value, held by Ameren Energy Resources Company, LLC (parent company of the registrant and subsidiary of Ameren Corporation) - 2,000

OMISSION OF CERTAIN INFORMATION

Ameren Energy Generating Company meets the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and is therefore filing this form with the reduced disclosure format allowed under that General Instruction.

This combined Form 10-Q 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 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			3

Forward-looking Statements			3

PART I	Financial Information

Item 1.	Financial Statements (Unaudited)
	Ameren Corporation
	Consolidated Statement of Income		5
	Consolidated Balance Sheet		6
	Consolidated Statement of Cash Flows		7
	Union Electric Company
	Statement of Income		8
	Balance Sheet		9
	Statement of Cash Flows		10
	Ameren Illinois Company
	Consolidated Statement of Income		11
	Balance Sheet		12
	Consolidated Statement of Cash Flows		13
	Ameren Energy Generating Company
	Consolidated Statement of Income		14
	Consolidated Balance Sheet		15
	Consolidated Statement of Cash Flows		16

	Combined Notes to Financial Statements		17

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations		51
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		74
Item 4.	Controls and Procedures		79

PART II	Other Information

Item 1.	Legal Proceedings		79
Item 1A.	Risk Factors		79
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		80
Item 6.	Exhibits		81

Signatures			83

This Form 10-Q 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 page 4 of this Form 10-Q 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 the individual registrants within the Ameren Corporation consolidated group. When appropriate, subsidiaries of Ameren Corporation are named specifically as their various business activities are discussed. Refer to the 2010 Form 10-K for a complete listing of glossary terms and abbreviations. Only new or significantly changed terms and abbreviations are included below.

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.

CCR - Coal combustion residuals.

Cole County Circuit Court - Circuit Court of Cole County, Missouri.

Form 10-K - The combined Annual Report on Form 10-K for the year ended December 31, 2010, filed by the Ameren Companies with the SEC.

MIEC - Missouri Industrial Energy Consumers.

MoOPC - Missouri Office of Public Counsel.

NO₂ - Nitrogen dioxide.

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 outcome of the pending Ameren Missouri electric rate proceeding and the AIC electric and natural gas rate proceedings; the court appeals related to Ameren Missouri’s 2009 and 2010 electric rate orders and the court appeals related to AIC’s 2010 electric and natural gas rate order; the MoPSC’s FAC prudence review and future appeals; and future regulatory, judicial, or legislative actions that seek to limit or reverse rate increases;

•

the effects of, or changes to, the Illinois power procurement process;

•

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

•

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 effects of our and other members' participation in, or potential withdrawal from, MISO, and the effects of new members joining MISO;

•

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;

•

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 extent to which Ameren Missouri prevails in its claims against insurers in connection with its Taum Sauk pumped-storage hydroelectric plant incident;

•

the extent to which Ameren Missouri is permitted by its regulators to recover in rates (i) certain of the Taum Sauk rebuild costs not covered by insurance, (ii) investments made in connection with a proposed second unit at its Callaway nuclear plant and (iii) investments to install scrubbers at its Sioux plant;

•

impairments of long-lived assets, intangible assets, or goodwill;

•

operation of Ameren Missouri’s nuclear power facility, including planned and unplanned outages, decommissioning costs and potential increased costs as a result of recent nuclear-related developments in Japan;

•

the effects of strategic initiatives, including mergers, acquisitions and divestitures;

•

the completion of Genco’s sale of its Columbia CT facility to the city of Columbia, Missouri;

•

the impact of current environmental regulations on utilities and power generating companies and the expectation that more stringent requirements, including those related to greenhouse gases, other emissions, and energy efficiency, will be enacted over time, which 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, work force 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’ facilities or required to satisfy energy sales made by the Ameren Companies;

•

legal and administrative proceedings; and

•

acts of sabotage, war, terrorism, or 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,
	2011		2010
Operating Revenues:
Electric	$	1,470	$	1,455
Gas		434		485

Total operating revenues		1,904		1,940


Operating Expenses:
Fuel		379		293
Purchased power		227		271
Gas purchased for resale		288		333
Other operations and maintenance		463		437
Depreciation and amortization		195		187
Taxes other than income taxes		125		121

Total operating expenses		1,677		1,642

Operating Income		227		298

Other Income and Expenses:
Miscellaneous income		16		22
Miscellaneous expense		5		7

Total other income		11		15

Interest Charges		119		132

Income Before Income Taxes		119		181
Income Taxes		45		75

Net Income		74		106
Less: Net Income Attributable to Noncontrolling Interests		3		4

Net Income Attributable to Ameren Corporation	$	71	$	102


Earnings per Common Share – Basic and Diluted	$	0.29	$	0.43

Dividends per Common Share	$	0.385	$	0.385
Average Common Shares Outstanding		240.6		237.6

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

AMEREN CORPORATION

CONSOLIDATED BALANCE SHEET

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

		December 31,		December 31,
	March 31, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	573	$	545
Accounts receivable – trade (less allowance for doubtful accounts of $33 and $23, respectively)		517		500
Unbilled revenue		310		406
Miscellaneous accounts and notes receivable		291		231
Materials and supplies		572		707
Mark-to-market derivative assets		137		129
Current regulatory assets		215		267
Other current assets		100		109

Total current assets		2,715		2,894

Property and Plant, Net		17,888		17,853
Investments and Other Assets:
Nuclear decommissioning trust fund		353		337
Goodwill		411		411
Intangible assets		7		7
Regulatory assets		1,217		1,263
Other assets		738		750

Total investments and other assets		2,726		2,768

TOTAL ASSETS	$	23,329	$	23,515

LIABILITIES AND EQUITY

Current Liabilities:
Current maturities of long-term debt	$	155	$	155
Short-term debt		334		269
Accounts and wages payable		401		651
Taxes accrued		134		63
Interest accrued		153		107
Customer deposits		100		100
Mark-to-market derivative liabilities		126		161
Current regulatory liabilities		140		99
Other current liabilities		294		283

Total current liabilities		1,837		1,888

Credit Facility Borrowings		270		460
Long-term Debt, Net		6,853		6,853
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		2,938		2,886
Accumulated deferred investment tax credits		88		90
Regulatory liabilities		1,371		1,319
Asset retirement obligations		482		475
Pension and other postretirement benefits		1,057		1,045
Other deferred credits and liabilities		553		615

Total deferred credits and other liabilities		6,489		6,430

Commitments and Contingencies (Notes 2, 8, 9 and 10)
Ameren Corporation Stockholders’ Equity:
Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 241.1 and 240.4, respectively		2		2
Other paid-in capital, principally premium on common stock		5,540		5,520
Retained earnings		2,203		2,225
Accumulated other comprehensive loss		(20)		(17)

Total Ameren Corporation stockholders’ equity		7,725		7,730
Noncontrolling Interests		155		154

Total equity		7,880		7,884

TOTAL LIABILITIES AND EQUITY	$	23,329	$	23,515

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,
	2011		2010
Cash Flows From Operating Activities:
Net income	$	74	$	106
Adjustments to reconcile net income to net cash provided by operating activities:
Net mark-to-market gain on derivatives		(16)		(31)
Depreciation and amortization		196		190
Amortization of nuclear fuel		17		13
Amortization of debt issuance costs and premium/discounts		5		9
Deferred income taxes and investment tax credits, net		62		70
Other		(3)		(8)
Changes in assets and liabilities:
Receivables		17		40
Materials and supplies		135		148
Accounts and wages payable		(221)		(181)
Taxes accrued		71		40
Assets, other		39		(32)
Liabilities, other		80		9
Pension and other postretirement benefits		28		30
Counterparty collateral, net		70		(23)

Net cash provided by operating activities		554		380

Cash Flows From Investing Activities:
Capital expenditures		(227)		(289)
Nuclear fuel expenditures		(18)		(23)
Purchases of securities – nuclear decommissioning trust fund		(91)		(60)
Sales of securities – nuclear decommissioning trust fund		87		56
Other		(1)		(1)

Net cash used in investing activities		(250)		(317)

Cash Flows From Financing Activities:
Dividends on common stock		(93)		(91)
Dividends paid to noncontrolling interest holders		(2)		(2)
Short-term and credit facility borrowings, net		(125)		(220)
Issuances of common stock		17		20
Generator advances for construction refunded, net of receipts		(73)		(32)

Net cash used in financing activities		(276)		(325)


Net change in cash and cash equivalents		28		(262)
Cash and cash equivalents at beginning of year		545		622

Cash and cash equivalents at end of period	$	573	$	360

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

UNION ELECTRIC COMPANY

STATEMENT OF INCOME

(Unaudited) (In millions)


	Three Months Ended March 31,
	2011		2010
Operating Revenues:
Electric	$	702	$	607
Gas		69		75
Other		1		-

Total operating revenues		772		682


Operating Expenses:
Fuel		229		124
Purchased power		20		44
Gas purchased for resale		40		46
Other operations and maintenance		233		218
Depreciation and amortization		100		92
Taxes other than income taxes		73		68

Total operating expenses		695		592

Operating Income		77		90

Other Income and Expenses:
Miscellaneous income		13		21
Miscellaneous expense		3		2

Total other income		10		19

Interest Charges		54		59

Income Before Income Taxes		33		50
Income Taxes		11		22

Net Income		22		28
Preferred Stock Dividends		1		1

Net Income Available to Common Stockholder	$	21	$	27

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

UNION ELECTRIC COMPANY

BALANCE SHEET

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

		December 31,		December 31,
	March 31, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	38	$	202
Accounts receivable – trade (less allowance for doubtful accounts of $11 and $8, respectively)		218		217
Accounts receivable – affiliates		3		6
Unbilled revenue		136		159
Miscellaneous accounts and notes receivable		125		116
Materials and supplies		327		341
Current regulatory assets		138		179
Other current assets		66		55

Total current assets		1,051		1,275

Property and Plant, Net		9,814		9,775
Investments and Other Assets:
Nuclear decommissioning trust fund		353		337
Intangible assets		4		2
Regulatory assets		690		694
Other assets		430		421

Total investments and other assets		1,477		1,454

TOTAL ASSETS	$	12,342	$	12,504

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Current maturities of long-term debt	$	5	$	5
Accounts and wages payable		161		326
Accounts payable – affiliates		77		75
Taxes accrued		75		76
Interest accrued		59		63
Current regulatory liabilities		41		23
Current accumulated deferred income taxes, net		33		43
Other current liabilities		83		89

Total current liabilities		534		700

Long-term Debt, Net		3,949		3,949
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		1,931		1,908
Accumulated deferred investment tax credits		77		78
Regulatory liabilities		800		766
Asset retirement obligations		368		363
Pension and other postretirement benefits		376		369
Other deferred credits and liabilities		201		218

Total deferred credits and other liabilities		3,753		3,702

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		1,555		1,555
Preferred stock not subject to mandatory redemption		80		80
Retained earnings		1,960		2,007

Total stockholders’ equity		4,106		4,153

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	12,342	$	12,504

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

UNION ELECTRIC COMPANY

STATEMENT OF CASH FLOWS

(Unaudited) (In millions)


	Three Months Ended March 31,
	2011		2010
Cash Flows From Operating Activities:
Net income	$	22	$	28
Adjustments to reconcile net income to net cash provided by operating activities:
Net mark-to-market loss on derivatives		1		-
Depreciation and amortization		100		92
Amortization of nuclear fuel		17		13
Amortization of debt issuance costs and premium/discounts		2		3
Deferred income taxes and investment tax credits, net		9		34
Allowance for equity funds used during construction		(6)		(12)
Changes in assets and liabilities:
Receivables		16		(16)
Materials and supplies		14		15
Accounts and wages payable		(159)		(159)
Taxes accrued		(1)		53
Assets, other		22		(29)
Liabilities, other		14		1
Pension and other postretirement benefits		14		11

Net cash provided by operating activities		65		34

Cash Flows From Investing Activities:
Capital expenditures		(118)		(163)
Nuclear fuel expenditures		(18)		(23)
Purchases of securities – nuclear decommissioning trust fund		(91)		(60)
Sales of securities – nuclear decommissioning trust fund		87		56
Other		(1)		-

Net cash used in investing activities		(141)		(190)

Cash Flows From Financing Activities:
Dividends on common stock		(68)		(58)
Dividends on preferred stock		(1)		(1)
Generator advances for construction received (refunded)		(19)		3

Net cash used in financing activities		(88)		(56)


Net change in cash and cash equivalents		(164)		(212)
Cash and cash equivalents at beginning of year		202		267

Cash and cash equivalents at end of period	$	38	$	55

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

AMEREN ILLINOIS COMPANY

CONSOLIDATED STATEMENT OF INCOME

(Unaudited) (In millions)


	Three Months Ended March 31,
	2011		2010^(a)
Operating Revenues:
Electric	$	442	$	501
Gas		366		410

Total operating revenues		808		911


Operating Expenses:
Purchased power		211		269
Gas purchased for resale		248		286
Other operations and maintenance		168		162
Depreciation and amortization		52		54
Taxes other than income taxes		41		42

Total operating expenses		720		813

Operating Income		88		98

Other Income and Expenses:
Miscellaneous income		2		2
Miscellaneous expense		1		3

Total other income (expense)		1		(1)

Interest Charges		35		37

Income Before Income Taxes		54		60
Income Taxes		20		24

Income from Continuing Operations		34		36
Income from Discontinued Operations, net of tax		-		12

Net Income		34		48
Preferred Stock Dividends		1		1

Net Income Available to Common Stockholder	$	33	$	47

^(a)	Prior period reflects the AIC Merger as discussed in Note 1 - Summary of Significant Accounting Policies.

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

AMEREN ILLINOIS COMPANY

BALANCE SHEET

(Unaudited) (In millions)

		December 31,		December 31,
	March 31, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	508	$	322
Accounts receivable – trade (less allowance for doubtful accounts of $21 and $13, respectively)		265		230
Accounts receivable – affiliates		14		73
Unbilled revenue		133		205
Miscellaneous accounts and notes receivable		110		44
Materials and supplies		75		198
Current regulatory assets		255		260
Other current assets		110		106

Total current assets		1,470		1,438

Property and Plant, Net		4,612		4,576
Investments and Other Assets:
Tax receivable – Genco		66		72
Goodwill		411		411
Regulatory assets		673		747
Other assets		129		162

Total investments and other assets		1,279		1,392

TOTAL ASSETS	$	7,361	$	7,406

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Current maturities of long-term debt	$	150	$	150
Accounts and wages payable		134		182
Accounts payable – affiliates		92		82
Taxes accrued		72		26
Interest accrued		53		27
Customer deposits		84		83
Mark-to-market derivative liabilities		69		82
Mark-to-market derivative liabilities – affiliates		179		172
Environmental remediation		65		72
Current regulatory liabilities		99		76
Other current liabilities		54		63

Total current liabilities		1,051		1,015

Long-term Debt, Net		1,657		1,657
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		759		724
Accumulated deferred investment tax credits		8		8
Regulatory liabilities		570		553
Pension and other postretirement benefits		418		413
Other deferred credits and liabilities		353		460

Total deferred credits and other liabilities		2,108		2,158

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		1,952		1,952
Preferred stock not subject to mandatory redemption		62		62
Retained earnings		512		542
Accumulated other comprehensive income		19		20

Total stockholders’ equity		2,545		2,576

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,361	$	7,406

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

AMEREN ILLINOIS COMPANY

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited) (In millions)


	Three Months Ended March 31,
	2011		2010^(a)
Cash Flows From Operating Activities:
Net income	$	34	$	48
Income from discontinued operations, net of tax		-		(12)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		52		54
Amortization of debt issuance costs and premium/discounts		2		3
Deferred income taxes and investment tax credits, net		34		(3)
Other		-		(1)
Changes in assets and liabilities:
Receivables		(17)		(2)
Materials and supplies		123		128
Accounts and wages payable		(47)		(69)
Taxes accrued		46		30
Assets, other		40		(71)
Liabilities, other		44		(17)
Pension and other postretirement benefits		11		11
Operating cash flows provided by discontinued operations		-		43

Net cash provided by operating activities		322		142

Cash Flows From Investing Activities:
Capital expenditures		(69)		(76)
Returns from (advances to) ATXI for construction		49		(3)
Net investing activities used in discontinued operations		-		(2)

Net cash used in investing activities		(20)		(81)

Cash Flows From Financing Activities:
Dividends on common stock		(62)		(33)
Dividends on preferred stock		(1)		(1)
Generator advances for construction refunded, net of receipts		(53)		(35)
Net financing activities used in discontinued operations		-		(43)

Net cash used in financing activities		(116)		(112)


Net change in cash and cash equivalents		186		(51)
Cash and cash equivalents at beginning of year		322		306

Cash and cash equivalents at end of period	$	508	$	255


Noncash investing activity – asset transfer from ATXI	$	20	$	1

^(a)	Prior period reflects the AIC Merger as discussed in Note 1 - Summary of Significant Accounting Policies.

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

AMEREN ENERGY GENERATING COMPANY

CONSOLIDATED STATEMENT OF INCOME

(Unaudited) (In millions)


	Three Months Ended March 31,
	2011		2010
Operating Revenues	$	241	$	266

Operating Expenses:
Fuel		111		124
Other operations and maintenance		45		49
Depreciation and amortization		24		24
Taxes other than income taxes		7		7

Total operating expenses		187		204

Operating Income		54		62
Miscellaneous Expense		-		1
Interest Charges		17		19

Income Before Income Taxes		37		42
Income Taxes		15		18

Net Income		22		24
Less: Net Income Attributable to Noncontrolling Interest		1		1

Net Income Attributable to Ameren Energy Generating Company	$	21	$	23

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

AMEREN ENERGY GENERATING COMPANY

CONSOLIDATED BALANCE SHEET

(Unaudited) (In millions)

		December 31,		December 31,
	March 31, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	6	$	6
Accounts receivable – affiliates		81		126
Miscellaneous accounts and notes receivable		35		19
Advances to money pool		90		25
Materials and supplies		126		130
Mark-to-market derivative assets		32		26
Other current assets		10		4

Total current assets		380		336

Property and Plant, Net		2,254		2,248
Investments and Other Assets:
Intangible assets		2		3
Other assets		26		24

TOTAL ASSETS	$	2,662	$	2,611

LIABILITIES AND EQUITY

Current Liabilities:
Accounts and wages payable	$	47	$	62
Accounts payable – affiliates		16		23
Current portion of tax payable – AIC		12		8
Taxes accrued		37		20
Interest accrued		27		13
Mark-to-market derivative liabilities		7		9
Mark-to-market derivative liabilities – affiliates		5		5
Current accumulated deferred income taxes, net		21		13
Other current liabilities		11		12

Total current liabilities		183		165

Credit Facility Borrowings		100		100
Long-term Debt, Net		824		824
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		271		253
Accumulated deferred investment tax credits		3		3
Tax payable – AIC		66		72
Asset retirement obligations		75		74
Pension and other postretirement benefits		85		88
Other deferred credits and liabilities		23		23

Total deferred credits and other liabilities		523		513

Commitments and Contingencies (Notes 8 and 9)
Ameren Energy Generating Company Stockholder’s Equity:
Common stock, no par value, 10,000 shares authorized – 2,000 shares outstanding		-		-
Other paid-in capital		649		649
Retained earnings		414		393
Accumulated other comprehensive loss		(43)		(44)

Total Ameren Energy Generating Company stockholder’s equity		1,020		998
Noncontrolling Interest		12		11

Total equity		1,032		1,009

TOTAL LIABILITIES AND EQUITY	$	2,662	$	2,611

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

AMEREN ENERGY GENERATING COMPANY

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited) (In millions)


	Three Months Ended March 31,
	2011		2010
Cash Flows From Operating Activities:
Net income	$	22	$	24
Adjustments to reconcile net income to net cash provided by operating activities:
Net mark-to-market gain on derivatives		(15)		(1)
Depreciation and amortization		25		27
Amortization of debt issuance costs and discounts		1		1
Deferred income taxes and investment tax credits, net		26		13
Changes in assets and liabilities:
Receivables		29		35
Materials and supplies		4		2
Accounts and wages payable		(16)		(31)
Taxes accrued		17		12
Assets, other		(3)		2
Liabilities, other		12		16
Pension and other postretirement benefits		(2)		3

Net cash provided by operating activities		100		103

Cash Flows From Investing Activities:
Capital expenditures		(35)		(40)
Changes in money pool advances		(65)		(41)

Net cash used in investing activities		(100)		(81)

Cash Flows From Financing Activities:
Note payable – Ameren		-		(22)

Net cash used in financing activities		-		(22)


Net change in cash and cash equivalents		-		-
Cash and cash equivalents at beginning of year		6		6

Cash and cash equivalents at end of period	$	6	$	6

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

AMEREN CORPORATION (Consolidated)

UNION ELECTRIC COMPANY

AMEREN ILLINOIS COMPANY (Consolidated)

AMEREN ENERGY GENERATING COMPANY (Consolidated)

COMBINED NOTES TO FINANCIAL STATEMENTS

(Unaudited)

March 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 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.

•

Ameren Missouri, or Union Electric Company, operates a rate-regulated electric generation, transmission and distribution business, and a rate-regulated natural gas transmission and distribution business in Missouri.

•

AIC, or Ameren Illinois Company, which does business as Ameren Illinois, operates a rate-regulated electric and natural gas transmission and distribution business in Illinois.

•

Genco, or Ameren Energy Generating Company, operates a merchant electric generation business in Illinois and Missouri. Genco has an 80% ownership interest in EEI.

Ameren has various other subsidiaries responsible for such activities as the marketing of power and provision of other shared services.

On October 1, 2010, Ameren, CIPS, CILCO, IP, AERG and Resources Company completed a two-step corporate internal reorganization. The first step of the reorganization was the AIC Merger. Upon consummation of the AIC Merger, the separate legal existence of CILCO and IP terminated. The second step of the reorganization involved the distribution of AERG stock from AIC to Ameren and the subsequent contribution by Ameren of the AERG stock to Resources Company. The AIC 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 AIC included purchase accounting adjustments related to Ameren’s acquisition of CILCORP in 2003. AIC accounted for the AERG distribution as a spinoff. AIC transferred AERG to Ameren based on AERG’s carrying value. AIC 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 14 - Discontinued Operations for additional information.

The financial statements of Ameren, AIC 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 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.

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, 2011, and 2010. The number of restricted stock shares and performance share units outstanding had an immaterial impact on earnings per share.

Long-term Incentive Plan of 1998 and 2006 Omnibus Incentive Compensation Plan

A summary of nonvested shares as of March 31, 2011, and changes during the three months ended March 31, 2011, under the Long-term Incentive Plan of 1998, as amended (1998 Plan), and the 2006 Omnibus Incentive Compensation Plan (2006 Plan) is presented below:


	Performance Share Units^(a)					Restricted Shares^(b)
	Share Units			Weighted-average Fair Value Per Unit at Grant Date		Shares			Weighted-average Fair Value Per Share at Grant Date
Nonvested at January 1, 2011		1,142,768		$	23.96		83,154		$	49.87
Granted⁽^c⁾		731,962			31.41		-			-
Dividends		-			-		260			28.22
Forfeitures		(9,393	)		25.66		(560	)		50.45
Vested⁽^d⁾		(122,185	)		31.00		(63,574	)		49.47
Nonvested at March 31, 2011		1,743,152		$	26.58		19,280		$	51.21

(a)	Granted under the 2006 Plan.

(b)	Granted under the 1998 Plan.

(c)	Includes performance share units (share units) granted to certain executive and nonexecutive officers and other eligible employees in January 2011 under the 2006 Plan.

(d)	Shares/units vested due to Ameren attainment of performance goals and 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 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 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 a three-year average earnings per share threshold during the performance period.

Ameren recorded compensation expense of $3 million and $5 million for the three months ended March 31, 2011, and 2010, respectively, and a related tax benefit of $1 million and $2 million for the three months ended March 31, 2011, and 2010, respectively. As of March 31, 2011, total compensation expense of $30 million related to nonvested awards not yet recognized was expected to be recognized over a weighted-average period of 25 months.

Accounting Changes

See Note 7 - Fair Value Measurements for a summary of recently adopted authoritative accounting guidance relating to fair value measurements.

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 March 31, 2011, Ameren’s and AIC’s goodwill related to the acquisition of IP in 2004 and the 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.

Intangible Assets. We evaluate intangible assets for impairment if events or changes in circumstances indicate that their carrying amount might be impaired. Ameren’s, Ameren Missouri’s and Genco’s intangible assets at March 31, 2011, primarily consisted of emission allowances. See Note 9 - Commitments and Contingencies for additional information on emission allowances. Additionally, at March 31, 2011, Ameren’s and Ameren Missouri’s intangible assets included renewable energy credits obtained through wind and solar purchase power agreements. The book value of each of Ameren’s and Ameren Missouri’s renewable energy credits as of March 31, 2011, was $2 million.

The following table presents the SO₂ and NO_x emission allowances held and the related aggregate SO₂ and NO_x emission allowance book values that were carried as intangible assets as of March 31, 2011. Emission allowances consist of various individual emission allowance certificates and do not expire.


SO₂ and NO_x in tons	SO ₂^(a)		NO _x^(b)		Book Value^(c)
Ameren⁽^d⁾		3,260,933		71,693	$	5
AMO		1,684,072		47,892		2
Genco		1,179,536		20,008		2
Other		397,325		3,793		1

(a)	Vintages are from 2011 to 2021. Each company possesses additional allowances for use in periods beyond 2021.

(b)	Vintage is 2011 and the remaining unused prior years’ allowances.

(c)	The book value at December 31, 2010, for Ameren, Ameren Missouri and Genco was $7 million, $2 million, and $3 million, respectively.

(d)	Includes amounts for Ameren registrants and nonregistrants subsidiaries.

Emission allowances are charged to fuel expense as they are used in operations. The following table presents amortization expense based on usage of emission allowances for Ameren, Ameren Missouri and Genco during the three months ended March 31, 2011, and 2010:


	Three Months
	2011		2010
Ameren^(a)	$	1	$	3
AMO		-		(b	)
Genco⁽^a⁾		1		3

(a)	Includes allowances consumed that were recorded through purchase accounting.

(b)	Less than $1 million.

Excise Taxes

Excise taxes imposed on us are reflected on Ameren Missouri electric and Ameren Missouri and AIC natural gas customer bills. They are recorded gross in Operating Revenues and Operating Expenses - Taxes Other than Income Taxes on the statement of income. Excise taxes reflected on AIC 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 and Operating Expenses - Taxes Other than Income Taxes for the three months ended March 31, 2011 and 2010:


	Three Months
	2011		2010
Ameren	$	51	$	46
AMO		29		25
AIC		22		21

Uncertain Tax Positions

The amount of unrecognized tax benefits as of March 31, 2011, was $247 million, $167 million, $53 million, and $21 million for Ameren, Ameren Missouri, AIC and Genco, respectively. The amount of unrecognized tax benefits as of March 31, 2011, that would impact the effective tax rate, if recognized, was less than $1 million, $3 million, less than $1 million and $1 million for Ameren, Ameren Missouri, AIC and Genco, respectively.

Ameren’s federal income tax returns for the years 2005 through 2009 are before the Appeals Office of the Internal Revenue Service.

State income tax returns are generally subject to examination for a period of three years after filing of the return. The Ameren Companies do not currently have material state income tax issues under examination, administrative appeals, 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.

It is reasonably possible that 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 such increases or decreases would be material to their results of operations, financial position or liquidity.

Asset Retirement Obligations

AROs at Ameren, Ameren Missouri, AIC and Genco increased compared to December 31, 2010, to reflect the accretion of obligations to their fair values.

Noncontrolling Interest

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. These noncontrolling interests were 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 was classified as a component of equity separate from Genco’s equity in its consolidated balance sheet.

A reconciliation of the equity changes attributable to the noncontrolling interest at Ameren and Genco for the three months ended March 31, 2011, and 2010, is shown below:


	Three Months
	2011			2010
Ameren:
Noncontrolling interest, beginning of period	$	154		$	204
Net income attributable to noncontrolling interest		3			4
Dividends paid to noncontrolling interest holders		(2	)		(2	)
Noncontrolling interest, end of period	$	155		$	206
Genco:
Noncontrolling interest, beginning of period	$	11		$	9
Net income attributable to noncontrolling interest		1			1
Noncontrolling interest, end of period	$	12		$	10

Genco Asset Sale

In April 2011, Genco reached an agreement to sell its remaining interest in the Columbia CT facility to the city of Columbia, Missouri. The sale is scheduled to be completed by June 1, 2011. Genco expects to receive cash proceeds of $45 million from the sale upon closing. Upon the completion of this sale, the existing power purchase agreements between Marketing Company and the city of Columbia would be terminated.

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 January 2009, the MoPSC issued an order approving an increase for Ameren Missouri in annual revenues of approximately $162 million for electric service and the implementation of a FAC and a vegetation management and infrastructure inspection cost tracking mechanism, among other things. In February 2009, Noranda, Ameren Missouri’s largest electric customer, and the MoOPC appealed certain aspects of the MoPSC decision to the Circuit Court of Pemiscot County, Missouri, the Circuit Court of Stoddard County, Missouri, and the Cole County Circuit Court. The Stoddard and Pemiscot County cases were consolidated (collectively, the Stoddard Circuit Court), and the Cole County case was dismissed. In September 2009, the Stoddard Circuit Court granted Noranda’s request to stay the electric rate increase granted by the January 2009 MoPSC order as it applies specifically to Noranda’s electric service account until the court renders its decision on the appeal. From the granting of the stay request until June 2010, Noranda paid into the Stoddard 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 Circuit Court’s registry. Noranda has continued to pay into the Stoddard Circuit Court’s registry its monthly FAC payments relating to electric service during the time periods prior to the effectiveness of the May 2010 electric rate order. Because of the lag between accumulations of changes in net fuel costs and when those net fuel costs are recovered through FAC charges applied to customers’ bills, a portion of Noranda’s FAC payment in January 2012 is expected to be the last contested amount deposited into the Stoddard Circuit Court’s registry relating to this 2009 electric rate order appeal. As of March 31, 2011, the aggregate amount held in the Stoddard Circuit Court’s registry was approximately $13 million.

In August 2010, the Stoddard Circuit Court issued a judgment that reversed parts of the MoPSC’s decision. Also, upon issuance, the Stoddard Circuit Court suspended its own judgment. Therefore, the entire amount currently held in the Stoddard Circuit Court’s registry will remain in the Stoddard Circuit Court’s registry pending the appeal discussed below.

In September 2010, Ameren Missouri filed an appeal with the Missouri Court of Appeals, Southern District. The Missouri Court of Appeals will conduct an independent review of the MoPSC’s order. Ameren Missouri believes the Stoddard Circuit Court’s judgment, which reversed parts of the MoPSC decision, will be found erroneous by the Court of Appeals; however, there can be no assurances that Ameren Missouri’s appeal will be successful. If Ameren Missouri prevails on all issues of its appeal, Ameren Missouri will receive all of the funds held in the Stoddard Circuit Court’s registry, plus accrued interest. If Ameren Missouri were to conclude that some portion of the funds held in the Stoddard Circuit Court’s registry becomes probable of refund to Noranda, a charge to earnings would be recorded for the estimated amount of refund in the period in which that determination was made. A decision by the Missouri Court of Appeals is not expected before the third quarter of 2011.

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 approximately $230 million, including $119 million to cover higher fuel costs and lower revenue from sales outside Ameren Missouri’s system.

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, the last Ameren Missouri rate order for which appeals have been exhausted. On February 15, 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 billings under 2010 electric rates, which includes the FAC, and 2007 electric rates. As of March 31, 2011, the aggregate amount held by the Cole County Circuit Court, excluding the bond amount, was approximately $3 million.

On February 16, 2011, the MoOPC and the MIEC separately made filings with the MoPSC in which each argued that the stay granted by the Cole County Circuit Court in December 2010 should apply to all Ameren Missouri customers rather than to just the four industrial customers that requested the stay. The MoOPC requested the MoPSC suspend Ameren Missouri’s currently effective rate schedules (approved by the 2010 Missouri electric rate order) and replace them with Ameren Missouri’s previously effective rate schedules (approved by the 2009 Missouri electric rate order) for all customers. The MIEC requested the MoPSC suspend Ameren Missouri’s currently effective rate schedules (approved by the 2010 Missouri electric rate order), including the FAC, and replace them with Ameren Missouri’s rate schedules approved by the MoPSC in its 2007 electric rate order for all customers. On March 16, 2011, the MoPSC denied the MoOPC’s request to suspend Ameren Missouri’s currently effective rate schedules for all customers. By denying the MoOPC’s request, the MoPSC effectively denied the MIEC’s request to suspend currently effective rates as well. The MoOPC and the MIEC then asked the Missouri Court of Appeals, Western District, to require the MoPSC to suspend Ameren Missouri’s currently effective rate schedules (approved by the 2010 Missouri electric rate order) and to replace them with Ameren Missouri’s previously effective rate schedules (approved by the 2009 Missouri electric rate order) for all customers. The Missouri Court of Appeals denied the request. On March 28, 2011, the MoOPC and MIEC made the same request to apply the stay granted to four industrial customers to all Ameren Missouri electric customers to the Cole County Circuit Court. On April 12, 2011, the Cole County Circuit Court denied the motion filed by the MoOPC and MIEC. The Cole County Circuit Court’s April 12, 2011 order concluded that the stay only granted the request of the four industrial 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 the 2007 Missouri electric rate order and that the language in the stay on which the March 28, 2011 motion by the MIEC and MoOPC was based was not part of the operative language of the stay and therefore the stay did not require Ameren Missouri to cease charging the rates approved by the 2010 Missouri electric rate order to all Ameren Missouri electric customers.

With respect to further judicial proceedings regarding the 2010 electric rate order, Ameren Missouri will continue to address the merits of the order and any further filings that might be made relating to the stay, if any, through the judicial and regulatory review processes. We cannot predict the ultimate outcome of these proceedings, which could have a material effect on Ameren Missouri’s and Ameren’s results of operations, financial position, and liquidity.

The stay in effect for the four industrial customers does not address the merits of the appeals of the MoPSC’s 2010 electric rate order or the 2009 electric rate order, which will be addressed in the ordinary course of the judicial review process. At this time, Ameren Missouri does not believe any aspect of the 2009 and 2010 electric rate increases authorized by the 2009 and 2010 Missouri electric rate orders are probable of refund to Ameren Missouri’s customers. If Ameren Missouri were to conclude that some portion of these rate increases become 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. A decision is expected to be issued on the MIEC’s and MoOPC’s appeal by the Cole County Circuit Court in 2011.

Pending Electric Rate Case

In September 2010, Ameren Missouri filed a request with the MoPSC to increase its annual revenues for electric service. The currently pending request, as amended in April 2011, seeks an increase of approximately $200 million. This increase request was based primarily on energy infrastructure investments, costs incurred to implement environmental controls and other costs incurred for system-wide reliability improvements for customers. Of the amended request, approximately $106 million relates to recovery of the cost of installing and operating two scrubbers at Ameren Missouri’s Sioux plant. Also included in this requested increase, as amended, is an approximately $40 million anticipated 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. Absent initiation of this general rate proceeding, 95% of the requested increase in normalized net fuel costs would have been reflected in rate adjustments implemented under Ameren Missouri’s FAC. Capital additions relating to enhancements at the rebuilt Taum Sauk facility were also included in the amended increase request. The amended electric rate increase request was based on a 10.7% return on equity, a capital structure composed of 52.2% common equity, an aggregate electric rate base of $6.7 billion, and a test year ended March 31, 2010, with certain pro-forma adjustments through the true-up date of February 28, 2011. Ameren Missouri also requested continued use of its existing vegetation management and infrastructure cost tracker and the regulatory tracking mechanism for pension and postretirement benefit costs authorized by the MoPSC in earlier electric rate orders.

Ameren Missouri has agreed to settlements of various issues, which are subject to approval by the MoPSC. Ameren Missouri agreed to withdraw its request to implement an infrastructure investment tracking mechanism for certain projects beyond their in-service dates. Ameren Missouri also agreed to withdraw its request to recover its investments in energy efficiency programs over three years instead of six. Ameren Missouri continues to seek the ability to recover any under-recovery of fixed costs resulting from implementation of energy efficiency measures.

In April 2011, the MoPSC staff revised its initial rate recommendation in Ameren Missouri’s pending electric rate case. The MoPSC staff now recommends an increase to Ameren Missouri’s annual revenues of $86 million based on a midpoint return on equity of 8.75%. Included in this recommendation was approximately $33 million of asset disallowances relating to the Sioux plant scrubbers. Other parties have also made recommendations through testimony filed in this case.

The MoPSC has several important issues to consider in this case. Those issues include determining the appropriate return on equity, any asset disallowances related to the Sioux plant scrubbers or enhancements at the rebuilt Taum Sauk facility and the timing of the recoverability of the property taxes associated with those assets, and whether Ameren Missouri should be able to continue to employ its existing FAC at the current 95% sharing level.

A decision by the MoPSC in this proceeding is required by July 2011. Ameren Missouri cannot predict the level of any electric service rate change the MoPSC may approve or whether any rate change that may eventually be approved will be sufficient to enable Ameren Missouri to recover its costs and earn a reasonable return on its investments when the rate change goes into effect.

FAC Prudence Review

Missouri law requires the MoPSC to complete prudence reviews of Ameren Missouri’s FAC at least every 18 months. On April 27, 2011, the MoPSC issued an order with respect to its prudency 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 due to the loss of Noranda’s load caused by a severe ice storm in January 2009.

Ameren Missouri disagrees with the MoPSC order’s classification of these sales and believes that the terms of its FAC tariff do not provide for the inclusion of these sales in the FAC calculation. Ameren Missouri intends to seek rehearing of the MoPSC’s order and, if necessary, to appeal this order through the judicial process. We cannot predict the ultimate outcome of the regulatory or judicial proceedings.

As a result of the order, Ameren Missouri will record, in the quarter ended June 30, 2011, a pretax charge to earnings of $17 million 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.

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. The MoPSC has not completed a prudency review of the FAC for this subsequent period. Consequently, the MoPSC order issued on April 27, 2011, did not involve any pretax earnings associated with the same long-term partial requirements contracts subsequent to September 30, 2009. Ameren Missouri is reviewing the MoPSC order and is assessing whether it believes the earnings it recognized associated with these sales subsequent to September 30, 2009, are probable of refund to its electric customers. 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.

Illinois

Pending Electric and Natural Gas Delivery Service Rate Cases

AIC filed a request with the ICC in February 2011 to increase its annual revenues for electric delivery service by $60 million. The electric rate increase request was based on an 11.25% return on equity, a capital structure composed of 53% equity, and a rate base of $2 billion.

AIC also filed a request with the ICC in February 2011 to increase its annual revenues for natural gas delivery service by $51 million. The natural gas rate increase request was based on an 11.0% return on equity, a capital structure composed of 53% equity, and a rate base of $978 million.

In an attempt to limit regulatory lag, AIC also used a future test year, 2012, in each of these rate requests. Additionally, AIC requested a rider mechanism for its pension costs. This requested rider mechanism would allow AIC to recover or refund any difference between pension expense incurred and the amount allowed in rates annually, subject to an annual reconciliation.

A decision by the ICC in these proceedings is required by January 2012. AIC cannot predict the level of any delivery service rate changes the ICC may approve or whether any rate changes that may eventually be approved will be sufficient to enable AIC to recover its costs and earn a reasonable return on its investments when the rate changes go into effect.

Federal

COLA and ESP

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 plant site. In 2009, Ameren Missouri suspended its efforts to build a new nuclear unit at its existing Missouri nuclear plant site, and the NRC suspended review of the COLA.

Ameren Missouri is considering filing an application to obtain an ESP from the NRC at the Callaway nuclear plant site. An ESP 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 ESP does not authorize construction of a plant. An ESP is valid for 20 years and potentially could be renewed for up to an additional 20 years. In December 2010 and January 2011, the Missouri Energy Partnership Act was separately introduced in both the Missouri Senate and House of Representatives. The purpose of this legislation is to maintain an option for nuclear power in the state of Missouri, recover the costs of the ESP for a period up to 20 years, and provide appropriate consumer protections.

All of Missouri’s major electric utility providers, including cooperatives, municipals, and other investor-owned utilities and the governor of Missouri, labor and other key stakeholders, support the passage of this legislation. However, passage of the legislation is uncertain.

Should the Missouri legislation be enacted into law, Ameren Missouri plans to file an ESP application with the NRC later in 2011. NRC approval of an ESP application is expected to take three to four years.

As of March 31, 2011, Ameren Missouri had capitalized approximately $67 million relating to its efforts to construct a new nuclear unit. All of these incurred costs will remain capitalized while management assesses all options to maximize the value of its investment in this project. If all 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.

NOTE 3 - 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.

The following tables summarize the borrowing activity and relevant interest rates under credit agreements as of March 31, 2011, and excludes issued letters of credit:


2010 Missouri Credit Agreement ($800 million)	Ameren (Parent)			AMO			Total
Average daily borrowings outstanding during 2011	$	238		$	-		$	238
Outstanding credit facility borrowings at period end		150			-			150
Weighted-average interest rate during 2011		2.31	%		-			2.31	%
Peak credit facility borrowings during 2011^(a)	$	340		$	-		$	340
Peak interest rate during 2011		2.31	%		-			2.31	%

2010 Genco Credit Agreement ($500 million)	Ameren (Parent)			Genco			Total
Average daily borrowings outstanding during 2011	$	-		$	100		$	100
Outstanding credit facility borrowings at period end		-			100			100
Weighted-average interest rate during 2011		-			2.31	%		2.31	%
Peak credit facility borrowings during 2011^(a)	$	-		$	100		$	100
Peak interest rate during 2011		-			2.31	%		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 the first three months of 2011 were $440 million.

Neither Ameren nor AIC borrowed under the 2010 Illinois Credit Agreement during the period ended March 31, 2011.

Based on outstanding borrowings under the 2010 Credit Agreements (including reductions for $15 million of letters of credit issued and $334 million of commercial paper borrowings), the aggregate available amount under the 2010 Credit Agreements at March 31, 2011, was $1.5 billion.

Other Agreements

On June 2, 2010, Ameren entered into a $20 million revolving credit facility ($20 Million Facility) that matures on June 1, 2012. The $20 Million Facility has been fully drawn since June 15, 2010. Borrowings under the $20 Million Facility bear interest at a rate equal to the applicable LIBOR plus 2.25% per annum. The obligations of Ameren under the $20 Million Facility are unsecured. No subsidiary of Ameren is a party to, guarantor of, or borrower under the facility.

Commercial Paper

The 2010 Credit Agreements are used to support Ameren’s and Ameren Missouri’s commercial paper programs. Ameren may at its discretion use any of the 2010 Credit Agreements to support its commercial paper program, subject to its applicable sublimit. At March 31, 2011, Ameren had $334 million of commercial paper outstanding, which reduced the available amounts under these facilities. During

the first three months of 2011, Ameren had average daily commercial paper balances outstanding of $321 million with a weighted-average interest rate of 0.94%. The peak short-term commercial paper outstanding and peak interest rate during the three months was $377 million and 1.46%, respectively.

Indebtedness Provisions and Other Covenants

The information below presents a summary of the Ameren Companies’ compliance with indebtedness provisions and other covenants. See Note 4 - Credit Facility Borrowings and Liquidity in the Form 10-K for a detailed description of those provisions.

The 2010 Credit Agreements contain conditions to 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 required regulatory authorizations. In addition, solely as it relates to borrowings under the 2010 Illinois Credit Agreement, it is a condition precedent to any such borrowing that, at the time of and after giving effect to such borrowing, the borrower will 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 affiliates, and to merge with other entities.

The 2010 Credit Agreements require each of Ameren, Ameren Missouri, AIC 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 March 31, 2011, the ratios of consolidated indebtedness to total consolidated capitalization, calculated in accordance with the provisions of the 2010 Credit Agreements, were 50%, 47%, 42% and 48%, for Ameren, Ameren Missouri, AIC 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, 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 March 31, 2011, was 4.8 to 1. Failure of a borrower to satisfy a financial covenant constitutes an immediate default under the applicable 2010 Credit Agreement.

The $20 Million Facility requires Ameren to maintain consolidated indebtedness of not more than 65% of its consolidated capitalization pursuant to a defined calculation set forth in the agreement. As of March 31, 2011, Ameren’s consolidated indebtedness ratio, calculated in accordance with the provisions of the $20 Million Facility, was 50%. Failure by Ameren to satisfy this covenant would constitute an immediate default under the $20 Million Facility but, given the size of the facility, would not trigger an Ameren default under any of the 2010 Credit Agreements or Ameren’s indenture.

None of the Ameren Companies’ credit facilities or financing arrangements contains credit rating triggers that would cause an event of default or acceleration of repayment of outstanding balances. At March 31, 2011, management believes that the Ameren Companies were in compliance with their credit facilities’ provisions and covenants.

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

Through the utility money pool, Ameren Missouri, AIC and Ameren Services may access the committed credit facilities 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. 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 their affiliates, but increased to the extent that the pool participants have surplus funds or contribute 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 three months ended March 31, 2011.

Non-state-regulated Subsidiary

Ameren Services, Resources Company, Genco, AERG, Marketing Company, and other non-state-regulated Ameren subsidiaries have the ability, subject to Ameren parent company authorization and applicable regulatory short-term

borrowing authorizations, to access funding from the 2010 Credit Agreements through a non-state-regulated subsidiary money pool agreement. The total amount available to the pool participants at any given time is reduced by the amount of borrowings made by Ameren’s subsidiaries, but is increased to the extent that other pool participants advance surplus funds to the non-state-regulated subsidiary money pool or remit funds from other external sources. See the discussion above for the amount available under the 2010 Credit Agreements at March 31, 2011. The non-state-regulated subsidiary money pool was established to coordinate and to provide short-term cash and working capital for Ameren’s non-state-regulated activities. 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 three months ended March 31, 2011, was 1.14% (2010 - 0.62%).

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, 2011.

NOTE 4 - LONG-TERM DEBT AND EQUITY FINANCINGS

Ameren

Under DRPlus, pursuant to an effective SEC Form S-3 registration statement, and under our 401(k) plan, pursuant to an effective SEC Form S-8 registration statement, Ameren issued a total of 0.6 million new shares of common stock valued at $17 million in the three months ended March 31, 2011.

Indenture Provisions and Other Covenants

Ameren Missouri’s and AIC’s indenture provisions and articles of incorporation include covenants and provisions related to issuances of first mortgage bonds and preferred stock. Ameren Missouri and AIC are required to meet certain ratios to issue additional first mortgage bonds and preferred stock. However, not meeting these ratios would not result in a default under these covenants and provisions. The following table includes the required and actual earnings coverage ratios for interest charges and preferred dividends and bonds and preferred stock issuable for the 12 months ended March 31, 2011, at an assumed interest rate of 7% and dividend rate of 8%.


	Required Interest Coverage Ratio^(a)	Actual Interest Coverage Ratio	Bonds Issuable^(b)			Required Dividend Coverage Ratio^(c)	Actual Dividend Coverage Ratio	Preferred Stock Issuable
AMO	³2.0	3.5	$	2,243		³2.5	88.4	$	1,755
AIC	³2.0	6.9		3,225	^(d)	³1.5	3.3		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 $91 million and $615 million at Ameren Missouri and AIC, 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 AIC based on unfunded property additions and retired bonds solely under the former IP mortgage indenture.

Ameren’s indenture, pursuant to which Ameren’s 8.875% $425 million senior unsecured notes due 2014 were issued, 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, AIC 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, AIC 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 AIC has specific authorization from the ICC.

Ameren Missouri’s mortgage indenture contains certain provisions that restrict the amount of common dividends that can be paid by Ameren Missouri. Under this mortgage indenture, $31 million of total retained earnings was restricted against payment of common dividends, except those dividends payable in common stock, which left $1.9 billion of free and unrestricted retained earnings at March 31, 2011.

AIC’s 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. AIC committed to FERC to maintain a minimum 30% ratio of common stock equity to total capitalization following the AIC Merger and AERG distribution. As of March 31, 2011, AIC had a ratio of common stock equity to total capitalization of 57%.

Genco’s indenture includes provisions that require Genco to maintain certain interest coverage and/or debt-to-capital ratios in order for Genco to pay dividends, make certain principal or interest payments, make certain loans to or investments in affiliates, or incur additional indebtedness. The following table summarizes these ratios for the 12 months ended and as of March 31, 2011:

Required
Interest
Coverage
Ratio

Actual
Interest
Coverage
Ratio

Required
Debt-to-
Capital
Ratio

Actual
Debt-to-
Capital
Ratio

Genco

³1.75^(a)/2.50⁽

^b)

4.4

£60%⁽

^b)

(a)

A minimum interest coverage ratio of 1.75 is required for Genco to make certain restricted payments, as defined, including specified dividend, principal and interest payments on certain subordinated intercompany borrowings. As of the date of the restricted payment, the minimum ratio must have been achieved for the most recently ended four fiscal quarters and projected by management to be achieved for each of the subsequent four six-month periods.

(b)

A minimum interest coverage ratio of 2.50 and for the most recently ended four fiscal quarters 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. The ratios must be computed on a pro forma basis considering the additional indebtedness to be incurred and related interest expense. Money pool borrowings are permitted indebtedness and are not subject to these incurrence tests.

Genco’s debt incurrence-related ratio restrictions and restricted payment limitations under its indenture may be disregarded if both Moody’s and S&P reaffirm their ratings of Genco indenture debt in place at the time of the incurrence of the additional indebtedness after giving effect to such additional indebtedness.

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

Off-Balance-Sheet Arrangements

At March 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.

NOTE 5 - OTHER INCOME AND EXPENSES

The following table presents Other Income and Expenses for each of the Ameren Companies for the three months ended March 31, 2011, and 2010:


	Three Months
	2011		2010
Ameren:^(a)
Miscellaneous income:
Allowance for equity funds used during construction	$	6	$	13
Interest income on industrial development revenue bonds		7		7
Interest and dividend income		1		1
Other		2		1
Total miscellaneous income	$	16	$	22
Miscellaneous expense:
Donations	$	2	$	2
Other		3		5
Total miscellaneous expense	$	5	$	7
AMO:
Miscellaneous income:
Allowance for equity funds used during construction	$	5	$	13
Interest income on industrial development revenue bonds		7		7
Interest and dividend income		1		-
Other		-		1
Total miscellaneous income	$	13	$	21
Miscellaneous expense:
Donations	$	1	$	1
Other		2		1
Total miscellaneous expense	$	3	$	2
AIC:
Miscellaneous income:
Allowance for equity funds used during construction	$	1	$	-
Interest and dividend income		-		1
Other		1		1
Total miscellaneous income	$	2	$	2
Miscellaneous expense:
Other	$	1	$	3
Total miscellaneous expense	$	1	$	3
Genco:
Miscellaneous expense:
Other	$	-	$	1
Total miscellaneous expense	$	-	$	1

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

NOTE 6 - DERIVATIVE FINANCIAL INSTRUMENTS

We use derivatives principally to manage the risk of changes in market prices for natural gas, coal, diesel, electricity, uranium, and emission allowances. 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 or emission allowances 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 March 31, 2011, and December 31, 2010:


	Quantity (in millions, except as indicated)
	NPNS						Cash Flow						Other						Derivatives That Qualify for
Commodity	Contracts^(a)						Hedges^(b)						Derivatives^(c)						Regulatory Deferral^(d)
	2011			2010			2011			2010			2011			2010			2011			2010
Coal (in tons)
Ameren^(e)		67			73			(f	)		(f	)		(f	)		(f	)		(f	)		(f	)
AMO		41			46			(f	)		(f	)		(f	)		(f	)		(f	)		(f	)
Genco		20			21			(f	)		(f	)		(f	)		(f	)		(f	)		(f	)
Heating oil (in gallons)
Ameren^(e)		(f	)		(f	)		(f	)		(f	)		46			55			69			80
AMO		(f	)		(f	)		(f	)		(f	)		(f	)		(f	)		69			80
Genco		(f	)		(f	)		(f	)		(f	)		35			43			(f	)		(f	)
Natural gas (in mmbtu)
Ameren^(e)		85			98			(f	)		(f	)		64			21			208			194
AMO		12			13			(f	)		(f	)		2			2			24			21
AIC		72			85			(f	)		(f	)		(f	)		(f	)		184			173
Genco		(f	)		(f	)		(f	)		(f	)		4			3			(f	)		(f	)
Power (in megawatthours)
Ameren^(e)		61			63			32			2			43			61			11			18
AMO		2			2			(f	)		(f	)		(g	)		1			5			5
AIC		(f	)		(f	)		(f	)		(f	)		(f	)		(f	)		22			26
Genco		(f	)		(f	)		(f	)		(f	)		3			3			(f	)		(f	)
Uranium (pounds in thousands)
Ameren		5,810			5,810			(f	)		(f	)		(f	)		(f	)		310			185
AMO		5,810			5,810			(f	)		(f	)		(f	)		(f	)		310			185

(a)	Contracts through December 2014, March 2015, September 2035, and October 2024 for coal, natural gas, power, and uranium, respectively, as of March 31, 2011.

(b)	Contracts through May 2014 for power as of March 31, 2011.

(c)	Contracts through December 2013, October 2012, and December 2014 for heating oil, natural gas, and power, respectively, as of March 31, 2011.

(d)	Contracts through December 2013, October 2016, May 2014 and November 2011 for heating oil, natural gas, power, and uranium, respectively, as of March 31, 2011.

(e)	Includes amounts for Ameren registrant and nonregistrant subsidiaries.

(f)	Not applicable.

(g)	Less than 1 million.

Authoritative 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 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 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. Contracts that qualify for cash flow hedge accounting 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 charged or credited to regulatory assets or regulatory liabilities in the period in which the change occurs. Ameren Missouri and AIC 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.

The following table presents the carrying value and balance sheet location of all derivative instruments as of March 31, 2011, and December 31, 2010:


	Balance Sheet Location	Ameren^(a)			AMO			AIC			Genco
2011:
Derivative assets designated as hedging instruments
Commodity contracts:
Power	MTM derivative assets	$	5		$	(b	)	$	(b	)	$	-
	Other assets		2			-			-			-
	Total assets	$	7		$	-		$	-		$	-
Derivative liabilities designated as hedging instruments
Commodity contracts:
Power	MTM derivative liabilities	$	2		$	(b	)	$	-		$	-
	Other deferred credits and liabilities		4			-			-			-
	Total liabilities	$	6		$	-		$	-		$	-
Derivative assets not designated as hedging instruments^(c)
Commodity contracts:
Heating oil	MTM derivative assets	$	64		$	(b	)	$	(b	)	$	21
	Other current assets		-			38			-			-
	Other assets		37			22			-			11
Natural gas	MTM derivative assets		8			(b	)		(b	)		1
	Other current assets		-			-			1			-
	Other assets		5			-			5			-
Power	MTM derivative assets		59			(b	)		(b	)		10
	Other current assets		-			6			3			-
	Other assets		21			1			2			-
Uranium	MTM derivative assets		1			(b	)		(b	)		-
	Other current assets		-			1			-			-
	Total assets	$	195		$	68		$	11		$	43
Derivative liabilities not designated as hedging instruments^(c)
Commodity contracts:
Heating oil	MTM derivative liabilities	$	5		$	(b	)	$	-		$	2
	Other current liabilities		-			3			-			-
	Other deferred credits and liabilities		-			-			-			1
Natural gas	MTM derivative liabilities		83			(b	)		64			3
	Other current liabilities		-			11			-			-
	Other deferred credits and liabilities		66			10			55			-
Power	MTM derivative liabilities		36			(b	)		5			2
	MTM derivative liabilities - affiliates		(b	)		(b	)		179			5
	Other current liabilities		-			3			-			-
	Other deferred credits and liabilities		13			1			146			-
	Total liabilities	$	203		$	28		$	449		$	13
2010:
Derivative assets designated as hedging instruments
Commodity contracts:
Power	MTM derivative assets	$	3		$	(b	)	$	(b	)	$	-
	Other assets		2			-			-			-
	Total assets	$	5		$	-		$	-		$	-
Derivative liabilities designated as hedging instruments
Commodity contracts:
Power	MTM derivative liabilities	$	1		$	(b	)	$	-		$	-
	Total liabilities	$	1		$	-		$	-		$	-
Derivative assets not designated as hedging instruments^(c)
Commodity contracts:
Heating oil	MTM derivative assets	$	42		$	(b	)	$	(b	)	$	14
	Other current assets		-			24			-			-
	Other assets		22			13			-			7
Natural gas	MTM derivative assets		4			(b	)		(b	)		1
	Other current assets		-			1			1			-
	Other assets		1			-			1			-
Power	MTM derivative assets		78			(b	)		(b	)		11
	Other current assets		-			8			2			-
	Other assets		20			-			6			-
Uranium	MTM derivative assets		2			(b	)		(b	)		-
	Other current assets		-			2			-			-
	Total assets	$	169		$	48		$	10		$	33


	Balance Sheet Location	Ameren^(a)			AMO			AIC		Genco
Derivative liabilities not designated as hedging instruments^(c)
Commodity contracts:
Heating oil	MTM derivative liabilities	$	12		$	(b	)	$	-	$	4
	Other current liabilities		-			7			-		-
	Other deferred credits and liabilities		1			-			-		-
Natural gas	MTM derivative liabilities		87			(b	)		73		2
	Other current liabilities		-			11			-		-
	Other deferred credits and liabilities		84			13			70		-
Power	MTM derivative liabilities		61			(b	)		9		3
	MTM derivative liabilities - affiliates		(b	)		(b	)		172		5
	Other current liabilities		-			6			-		-
	Other deferred credits and liabilities		7			-			179		-
	Total liabilities	$	252		$	37		$	503	$	14

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

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

(c)	Includes derivatives subject to regulatory deferral.

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 March 31, 2011, and December 31, 2010:


	Ameren^(a)			AMO			AIC			Genco
2011
Cumulative gains (losses) deferred in accumulated OCI:
Power derivative contracts^(b)	$	5		$	-		$	-		$	-
Interest rate derivative contracts^(c)(d)		(9	)		-			-			(9	)
Cumulative gains (losses) deferred in regulatory liabilities or assets:
Heating oil derivative contracts^(e)		48			48			-			-
Natural gas derivative contracts^(f)		(134	)		(21	)		(113	)		-
Power derivative contracts^(g)		3			3			(325	)		-
Uranium derivative contracts^(h)		1			1			-			-
2010:
Cumulative gains (losses) deferred in accumulated OCI:
Power derivative contracts^(b)	$	8		$	-		$	-		$	-
Interest rate derivative contracts^(c)(d)		(9	)		-			-			(9	)
Cumulative gains (losses) deferred in regulatory liabilities or assets:
Heating oil derivative contracts^(e)		19			19			-			-
Natural gas derivative contracts^(f)		(165	)		(24	)		(141	)		-
Power derivative contracts^(g)		1			3			(352	)		-
Uranium derivative contracts^(h)		2			2			-			-

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

(b)

Represents net gains associated with power derivative contracts at Ameren. These contracts are a partial hedge of electricity price exposure through May 2014 as of March 31, 2011. Current gains of $6 million and $8 million were recorded at Ameren as of March 31, 2011, and December 31, 2010, respectively.

(c)

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 March 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.

(d)

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 March 31, 2011, and December 31, 2010, was a loss of $10 million and $10 million, respectively. Over the next twelve months, $1.4 million of the loss will be amortized.

(e)

Represents net gains on heating oil derivative contracts at Ameren Missouri. These contracts are a partial hedge of Ameren Missouri’s transportation costs for coal through December 2013 as of March 31, 2011. Current gains deferred as regulatory liabilities include $29 million and $29 million at Ameren and Ameren Missouri as of March 31, 2011, respectively. Current losses deferred as regulatory assets include $3 million and $3 million at Ameren and Ameren Missouri as of March 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 AIC, in each case as of March 31, 2011. Current gains deferred as regulatory liabilities include $2 million and $2 million at Ameren and AIC, respectively, as of March 31, 2011. Current losses deferred as regulatory assets include $74 million, $10 million, and $64 million at Ameren, Ameren Missouri and AIC, respectively, as of March 31, 2011. Current gains deferred as regulatory liabilities include $1 million and $1 million at Ameren and Ameren Missouri, 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 AIC, respectively, as of December 31, 2010.

(g)

Represents net gains associated with power derivative contracts. These contracts are a partial hedge of power price requirements through May 2013 at Ameren and AIC and through December 2012 at Ameren Missouri, in each case as of March 31, 2011. Current gains deferred as regulatory liabilities include $8 million, $5 million, and $3 million at Ameren, Ameren Missouri and AIC, respectively, as of March 31, 2011. Current losses deferred as regulatory assets include $7 million, $2 million, and $184 million at Ameren, Ameren Missouri and AIC, respectively, as of March 31, 2011. Current gains

deferred as regulatory liabilities include $8 million, $6 million, and $2 million at Ameren, Ameren Missouri and AIC, 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 AIC, respectively, as of December 31, 2010.

(h)

Represents net gains on uranium derivative contracts at Ameren Missouri. These contracts are a partial hedge of our uranium requirements through November 2011 as of March 31, 2011. Current gains deferred as regulatory liabilities include $1 million and $1 million at Ameren and Ameren Missouri as of March 31, 2011, respectively. Current gains deferred as regulatory liabilities include $2 million and $2 million at Ameren and Ameren Missouri as of December 31, 2010, respectively.

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) 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) 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 March 31, 2011, and December 31, 2010, if counterparty groups were to completely fail 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:
Ameren^(b)	$	378	$	24	$	15	$	14	$	117	$	309	$	4	$	78	$	939
AMO		-		13		1		3		9		8		-		-		34
AIC		-		-		4		-		4		-		-		-		8
Genco		-		6		2		1		7		-		3		-		19
2010:
Ameren^(b)	$	410	$	30	$	16	$	22	$	72	$	550	$	10	$	75	$	1,182
AMO		-		21		1		2		5		11		1		-		41
AIC		-		-		3		-		1		-		-		-		4
Genco		-		6		2		1		1		-		6		-		16

(a)

Primarily comprised of Marketing Company’s exposure to AIC related to financial contracts. The exposure is not eliminated at the consolidated Ameren level as it is calculated without regard to the offsetting affiliate counterparty’s liability position. See Note 14–Related Party Transactions in the Form 10-K for additional information on these financial contracts.

(b)	Includes amounts for Ameren registrant and nonregistrant subsidiaries.

The following table presents the amount of cash collateral held from counterparties, as of March 31, 2011, and December 31, 2010, 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:


	Affiliates^(a)		Coal Producers		Commodity Marketing Companies		Electric Utilities		Financial Companies		Municipalities/ Cooperatives		Oil and Gas Companies		Retail Companies		Total
2011:
Ameren^(a)	$	-	$	-	$	-	$	-	$	33	$	-	$	-	$	-	$	33
2010:
Ameren^(a)	$	-	$	-	$	-	$	-	$	-	$	-	$	-	$	1	$	1

(a)	Represents amounts held by Marketing Company. As of March 31, 2011, and December 31, 2010, Ameren registrant subsidiaries held no cash collateral.

The potential loss on counterparty exposures is reduced by all collateral held and the application of master trading and netting agreements. Collateral includes both cash collateral and other collateral held. As of March 31, 2011, other collateral consisted of letters of credit in the amount of $11 million and $4 million held by Ameren and Genco, respectively. As of December 31, 2010, other collateral consisted of letters of credit in the amount of $28 million and $1 million held by Ameren and AIC, respectively. The following table presents the potential loss after consideration of collateral and application of master trading and netting agreements as of March 31, 2011, and December 31, 2010:


	Affiliates^(a)		Coal Producers		Commodity Marketing Companies		Electric Utilities		Financial Companies		Municipalities/ Cooperatives		Oil and Gas Companies		Retail Companies		Total
2011:
Ameren(b)	$	370	$	7	$	11	$	7	$	65	$	302	$	1	$	78	$	841
AMO		-		3		-		1		6		8		-		-		18
AIC		-		-		3		-		-		-		-		-		3
Genco		-		2		1		1		1		-		1		-		6
2010:
Ameren^(b)	$	404	$	10	$	11	$	9	$	59	$	523	$	7	$	71	$	1,094
AMO		-		8		-

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents