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 September 30, 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

Union Electric Company

Yes

Ameren Illinois Company

Yes

Ameren Energy Generating Company

Yes

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

Union Electric Company

Yes

Ameren Illinois Company

Yes

Ameren Energy Generating Company

Yes

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

Union Electric Company

Yes

Ameren Illinois Company

Yes

Ameren Energy Generating Company

Yes

The number of shares outstanding of each registrant’s classes of common stock as of October 31, 2011, was as follows:


Ameren Corporation		Common stock, $0.01 par value per share - 242,239,840

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		60
Item 3.	Quantitative and Qualitative Disclosures About Market Risk		91
Item 4.	Controls and Procedures		95

PART II	Other Information

Item 1.	Legal Proceedings		96
Item 1A.	Risk Factors		96
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds		96
Item 6.	Exhibits		97

Signatures			99

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 beginning 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 Illinois or AIC - Ameren Illinois Company, an Ameren Corporation subsidiary that operates a rate-regulated electric and natural gas transmission and distribution business in Illinois, doing business as Ameren Illinois. This business consists of the combined rate-regulated electric and natural gas transmission and distribution businesses operated by CIPS, CILCO and IP before the Ameren Illinois Merger. References to Ameren Illinois prior to the Ameren Illinois Merger refer collectively to the rate-regulated electric and natural gas transmission and distribution businesses of CIPS, CILCO and IP. Immediately after the Ameren Illinois Merger, Ameren Illinois distributed the common stock of AERG to Ameren Corporation. AERG’s operating results and cash flows were presented as discontinued operations in Ameren Illinois’ financial statements.

Ameren Illinois Merger - On October 1, 2010, CILCO and IP merged with and into CIPS, with the surviving corporation renamed Ameren Illinois Company.

Ameren Illinois Regulated Segment - A financial reporting segment consisting of Ameren Illinois’ rate-regulated businesses.

Ameren Missouri or AMO - Union Electric Company, an Ameren Corporation subsidiary that operates a rate-regulated electric generation, transmission and distribution business, and a rate-regulated natural gas transmission and distribution business in Missouri, doing business as Ameren Missouri. Ameren Missouri is also defined as a financial reporting segment consisting of Union Electric Company’s rate-regulated businesses.

CCR - Coal combustion residuals.

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

CSAPR - Cross-State Air Pollution Rule.

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.

NWPA - Nuclear Waste Policy Act of 1982, as amended.

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 Illinois electric and natural gas rate proceedings; the court appeals related to Ameren Missouri’s 2009, 2010, and 2011 electric rate orders, Ameren Illinois’ 2010 electric and natural gas rate order, and Ameren Missouri’s FAC prudence review; and future regulatory, judicial, or legislative actions that seek to change regulatory recovery mechanisms, such as the recent passage of legislation providing for formula ratemaking in Illinois;

•

the 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 energy center incident;

•

the extent to which Ameren Missouri is permitted by its regulators to recover in rates investments made in connection with a proposed second unit at its Callaway energy center;

•

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

•

operation of Ameren Missouri’s Callaway energy center, including planned and unplanned outages, decommissioning costs and potential increased costs as a result of nuclear-related developments in Japan in 2011;

•

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

•

the impact of current environmental regulations on utilities and power generating companies and the expectation that new or 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’ energy centers 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 (LOSS)

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


	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
Operating Revenues:
Electric	$	2,138	$	2,133	$	5,222	$	5,140
Gas		130		134		731		792

Total operating revenues		2,268		2,267		5,953		5,932


Operating Expenses:
Fuel		467		394		1,217		973
Purchased power		332		376		796		915
Gas purchased for resale		46		51		413		467
Other operations and maintenance		432		455		1,368		1,357
Goodwill, impairment and other charges		124		589		126		589
Depreciation and amortization		196		194		585		571
Taxes other than income taxes		121		119		355		342

Total operating expenses		1,718		2,178		4,860		5,214

Operating Income		550		89		1,093		718

Other Income and Expenses:
Miscellaneous income		18		24		51		70
Miscellaneous expense		5		10		15		19

Total other income		13		14		36		51
Interest Charges		113		130		336		377

Income (Loss) Before Income Taxes		450		(27)		793		392

Income Taxes		163		137		293		295


Net Income (Loss)		287		(164)		500		97
Less: Net Income Attributable to Noncontrolling Interests		2		3		6		10

Net Income (Loss) Attributable to Ameren Corporation	$	285	$	(167)	$	494	$	87


Earnings (Loss) per Common Share – Basic and Diluted	$	1.18	$	(0.70)	$	2.05	$	0.37

Dividends per Common Share	$	0.385	$	0.385	$	1.155	$	1.155
Average Common Shares Outstanding		241.7		239.3		241.2		238.4

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

AMEREN CORPORATION

CONSOLIDATED BALANCE SHEET

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


	September 30, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	522	$	545
Accounts receivable – trade (less allowance for doubtful accounts of $21 and $23, respectively)		575		517
Unbilled revenue		292		406
Miscellaneous accounts and notes receivable		147		214
Materials and supplies		734		707
Mark-to-market derivative assets		94		129
Current regulatory assets		184		267
Other current assets		132		109

Total current assets		2,680		2,894

Property and Plant, Net		17,873		17,853
Investments and Other Assets:
Nuclear decommissioning trust fund		330		337
Goodwill		411		411
Intangible assets		6		7
Regulatory assets		1,213		1,263
Other assets		843		750

Total investments and other assets		2,803		2,768

TOTAL ASSETS	$	23,356	$	23,515

LIABILITIES AND EQUITY

Current Liabilities:
Current maturities of long-term debt	$	178	$	155
Short-term debt		350		269
Accounts and wages payable		410		651
Taxes accrued		161		63
Interest accrued		159		107
Customer deposits		98		100
Mark-to-market derivative liabilities		118		161
Current regulatory liabilities		123		99
Other current liabilities		251		283

Total current liabilities		1,848		1,888

Credit Facility Borrowings		-		460
Long-term Debt, Net		6,682		6,853
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		3,299		2,886
Accumulated deferred investment tax credits		81		90
Regulatory liabilities		1,464		1,319
Asset retirement obligations		439		475
Pension and other postretirement benefits		922		1,045
Other deferred credits and liabilities		469		615

Total deferred credits and other liabilities		6,674		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 242.2 and 240.4, respectively		2		2
Other paid-in capital, principally premium on common stock		5,580		5,520
Retained earnings		2,440		2,225
Accumulated other comprehensive loss		(25)		(17)

Total Ameren Corporation stockholders’ equity		7,997		7,730
Noncontrolling Interests		155		154

Total equity		8,152		7,884

TOTAL LIABILITIES AND EQUITY	$	23,356	$	23,515

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

AMEREN CORPORATION

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited) (In millions)


	Nine Months Ended September 30,
	2011		2010
Cash Flows From Operating Activities:
Net income	$	500	$	97
Adjustments to reconcile net income to net cash provided by operating activities:
Goodwill, impairment and other charges		126		589
Gain on sales of properties		(12)		(5)
Net mark-to-market (gain) loss on derivatives		15		(27)
Depreciation and amortization		587		588
Amortization of nuclear fuel		51		36
Amortization of debt issuance costs and premium/discounts		17		19
Deferred income taxes and investment tax credits, net		380		409
Allowance for equity funds used during construction		(25)		(40)
Other		8		13
Changes in assets and liabilities:
Receivables		52		(154)
Materials and supplies		(34)		39
Accounts and wages payable		(191)		(170)
Taxes accrued		94		99
Assets, other		64		(107)
Liabilities, other		(4)		89
Pension and other postretirement benefits		(98)		(12)
Counterparty collateral, net		37		(24)
Taum Sauk insurance recoveries, net of costs		(1)		57

Net cash provided by operating activities		1,566		1,496

Cash Flows From Investing Activities:
Capital expenditures		(758)		(757)
Nuclear fuel expenditures		(45)		(24)
Purchases of securities – nuclear decommissioning trust fund		(163)		(207)
Sales of securities – nuclear decommissioning trust fund		147		195
Proceeds from sales of properties		50		20
Other		12		(3)

Net cash used in investing activities		(757)		(776)

Cash Flows From Financing Activities:
Dividends on common stock		(279)		(276)
Capital issuance costs		-		(15)
Dividends paid to noncontrolling interest holders		(5)		(7)
Short-term debt and credit facility repayments, net		(379)		(325)
Redemptions, repurchases, and maturities:
Long-term debt		(150)		(106)
Preferred stock		-		(52)
Issuances of common stock		49		60
Generator advances for construction refunded, net of receipts		(73)		(18)
Other		5		5


Net cash used in financing activities		(832)		(734)

Net change in cash and cash equivalents		(23)		(14)
Cash and cash equivalents at beginning of year		545		622

Cash and cash equivalents at end of period	$	522	$	608

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

UNION ELECTRIC COMPANY

STATEMENT OF INCOME

(Unaudited) (In millions)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
Operating Revenues:
Electric	$	1,099	$	1,040	$	2,592	$	2,384
Gas		16		20		113		118
Other		-		-		4		1

Total operating revenues		1,115		1,060		2,709		2,503


Operating Expenses:
Fuel		249		205		682		441
Purchased power		35		48		81		134
Gas purchased for resale		4		8		55		64
Other operations and maintenance		218		233		682		691
Loss from regulatory disallowance		89		-		89		-
Depreciation and amortization		102		99		300		283
Taxes other than income taxes		85		82		234		218

Total operating expenses		782		675		2,123		1,831

Operating Income		333		385		586		672

Other Income and Expenses:
Miscellaneous income		16		23		45		64
Miscellaneous expense		2		8		8		11

Total other income		14		15		37		53
Interest Charges		54		56		153		158

Income Before Income Taxes		293		344		470		567
Income Taxes		102		120		166		200

Net Income		191		224		304		367
Preferred Stock Dividends		1		1		3		4

Net Income Available to Common Stockholder	$	190	$	223	$	301	$	363

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)


	September 30, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	356	$	202
Accounts receivable – trade (less allowance for doubtful accounts of $7 and $8, respectively)		308		217
Accounts receivable – affiliates		1		6
Unbilled revenue		131		159
Miscellaneous accounts and notes receivable		35		116
Materials and supplies		337		341
Current regulatory assets		103		179
Other current assets		68		55

Total current assets		1,339		1,275

Property and Plant, Net		9,796		9,775
Investments and Other Assets:
Nuclear decommissioning trust fund		330		337
Intangible assets		5		2
Regulatory assets		694		694
Other assets		474		421

Total investments and other assets		1,503		1,454

TOTAL ASSETS	$	12,638	$	12,504

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Current maturities of long-term debt	$	178	$	5
Accounts and wages payable		160		326
Accounts payable – affiliates		48		75
Taxes accrued		131		76
Interest accrued		72		63
Current regulatory liabilities		55		23
Current accumulated deferred income taxes, net		19		43
Other current liabilities		82		89

Total current liabilities		745		700

Long-term Debt, Net		3,777		3,949
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		2,148		1,908
Accumulated deferred investment tax credits		71		78
Regulatory liabilities		804		766
Asset retirement obligations		334		363
Pension and other postretirement benefits		352		369
Other deferred credits and liabilities		172		218

Total deferred credits and other liabilities		3,881		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		2,089		2,007

Total stockholders’ equity		4,235		4,153

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	12,638	$	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)


	Nine Months Ended September 30,
	2011		2010
Cash Flows From Operating Activities:
Net income	$	304	$	367
Adjustments to reconcile net income to net cash provided by operating activities:
Loss from regulatory disallowance		89		-
Depreciation and amortization		300		283
Amortization of nuclear fuel		51		36
Amortization of debt issuance costs and premium/discounts		5		2
Deferred income taxes and investment tax credits, net		203		266
Allowance for equity funds used during construction		(22)		(38)
Other		1		9
Changes in assets and liabilities:
Receivables		(46)		(160)
Materials and supplies		2		10
Accounts and wages payable		(142)		(96)
Taxes accrued		51		118
Assets, other		56		(148)
Liabilities, other		1		77
Pension and other postretirement benefits		2		(5)
Taum Sauk insurance recoveries, net of costs		(1)		57

Net cash provided by operating activities		854		778

Cash Flows From Investing Activities:
Capital expenditures		(402)		(445)
Nuclear fuel expenditures		(45)		(24)
Purchases of securities – nuclear decommissioning trust fund		(163)		(207)
Sales of securities – nuclear decommissioning trust fund		147		195
Other		4		-

Net cash used in investing activities		(459)		(481)

Cash Flows From Financing Activities:
Dividends on common stock		(219)		(176)
Dividends on preferred stock		(3)		(4)
Capital issuance costs		-		(4)
Redemptions, repurchases, and maturities:
Long-term debt		-		(66)
Preferred stock		-		(33)
Generator advances for construction received (refunded)		(19)		10

Net cash used in financing activities		(241)		(273)

Net change in cash and cash equivalents		154		24
Cash and cash equivalents at beginning of year		202		267

Cash and cash equivalents at end of period	$	356	$	291

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 September 30,				Nine Months Ended September 30,
	2011		2010^(a)		2011		2010^(a)
Operating Revenues:
Electric	$	631	$	632	$	1,556	$	1,630
Gas		114		114		619		674
Other		-		-		1		-

Total operating revenues		745		746		2,176		2,304


Operating Expenses:
Purchased power		270		286		677		782
Gas purchased for resale		43		42		358		401
Other operations and maintenance		152		155		501		476
Depreciation and amortization		55		52		161		158
Taxes other than income taxes		29		29		96		95

Total operating expenses		549		564		1,793		1,912

Operating Income		196		182		383		392

Other Income and Expenses:
Miscellaneous income		2		2		5		6
Miscellaneous expense		2		2		4		6

Total other income		-		-		1		-
Interest Charges		33		37		103		108

Income Before Income Taxes		163		145		281		284
Income Taxes		65		54		111		109

Income from Continuing Operations		98		91		170		175
Income from Discontinued Operations, net of tax		-		19		-		40

Net Income		98		110		170		215
Preferred Stock Dividends		-		1		2		4

Net Income Available to Common Stockholder	$	98	$	109	$	168	$	211

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

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

AMEREN ILLINOIS COMPANY

BALANCE SHEET

(Unaudited) (In millions)


	September 30, 2011		December 31, 2010
ASSETS
Current Assets:
Cash and cash equivalents	$	116	$	322
Accounts receivable – trade (less allowance for doubtful accounts of $13 and $13, respectively)		194		230
Accounts receivable – affiliates		9		73
Unbilled revenue		122		205
Miscellaneous accounts and notes receivable		73		44
Materials and supplies		239		198
Current regulatory assets		247		260
Other current assets		108		106

Total current assets		1,108		1,438

Property and Plant, Net		4,699		4,576
Investments and Other Assets:
Tax receivable – Genco		61		72
Goodwill		411		411
Regulatory assets		571		747
Other assets		214		162

Total investments and other assets		1,257		1,392

TOTAL ASSETS	$	7,064	$	7,406

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current Liabilities:
Current maturities of long-term debt	$	-	$	150
Accounts and wages payable		135		182
Accounts payable – affiliates		58		82
Taxes accrued		12		26
Interest accrued		46		27
Customer deposits		80		83
Mark-to-market derivative liabilities		73		82
Mark-to-market derivative liabilities – affiliates		166		172
Environmental remediation		57		72
Current regulatory liabilities		68		76
Other current liabilities		58		63

Total current liabilities		753		1,015

Long-term Debt, Net		1,658		1,657
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		925		724
Accumulated deferred investment tax credits		7		8
Regulatory liabilities		660		553
Pension and other postretirement benefits		328		413
Other deferred credits and liabilities		231		460

Total deferred credits and other liabilities		2,151		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		471		542
Accumulated other comprehensive income		17		20

Total stockholders’ equity		2,502		2,576

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	7,064	$	7,406

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

AMEREN ILLINOIS COMPANY

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited) (In millions)


	Nine Months Ended September 30,
	2011		2010^(a)
Cash Flows From Operating Activities:
Net income	$	170	$	215
Income from discontinued operations, net of tax		-		(40)
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		161		158
Amortization of debt issuance costs and premium/discounts		6		9
Deferred income taxes and investment tax credits, net		202		143
Other		(7)		(5)
Changes in assets and liabilities:
Receivables		104		(16)
Materials and supplies		(41)		(31)
Accounts and wages payable		(58)		(41)
Taxes accrued		(14)		22
Assets, other		24		(76)
Liabilities, other		(11)		14
Pension and other postretirement benefits		(98)		(6)
Operating cash flows provided by discontinued operations		-		113

Net cash provided by operating activities		438		459

Cash Flows From Investing Activities:
Capital expenditures		(261)		(215)
Returns from (advances to) ATXI for construction		49		(7)
Proceeds from intercompany note receivable – Genco		-		45
Net investing activities used in discontinued operations		-		(6)

Net cash used in investing activities		(212)		(183)

Cash Flows From Financing Activities:
Dividends on common stock		(238)		(100)
Dividends on preferred stock		(2)		(4)
Capital issuance costs		-		(4)
Redemptions, repurchases, and maturities:
Long-term debt		(150)		(40)
Preferred stock		-		(19)
Capital contribution from parent		6		-
Generator advances for construction refunded, net of receipts		(53)		(28)
Other		5		5
Net financing activities used in discontinued operations		-		(107)


Net cash used in financing activities		(432)		(297)

Net change in cash and cash equivalents		(206)		(21)
Cash and cash equivalents at beginning of year		322		306

Cash and cash equivalents at end of period	$	116	$	285

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

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

AMEREN ENERGY GENERATING COMPANY

CONSOLIDATED STATEMENT OF INCOME (LOSS)

(Unaudited) (In millions)

		$327		$327		$327		$327
	Three Months Ended September 30,				Nine Months Ended September 30,
	2011		2010		2011		2010
Operating Revenues	$	327	$	335	$	828	$	877

Operating Expenses:
Fuel		169		146		410		405
Purchased power		37		42		55		62
Other operations and maintenance		48		47		137		141
Goodwill, impairment and other charges		35		170		36		170
Depreciation and amortization		24		25		73		74
Taxes other than income taxes		4		4		16		17

Total operating expenses		317		434		727		869

Operating Income (Loss)		10		(99)		101		8

Other Income and Expenses:
Miscellaneous income		1		-		1		1
Miscellaneous expense		-		-		-		1

Total other income		1		-		1		-
Interest Charges		16		21		47		60

Income (Loss) Before Income Taxes		(5)		(120)		55		(52)
Income Taxes (Benefit)		(1)		(20)		24		10

Net Income (Loss)		(4)		(100)		31		(62)
Less: Net Income Attributable to Noncontrolling Interest		1		1		2		3

Net Income (Loss) Attributable to Ameren Energy Generating Company	$	(5)	$	(101)	$	29	$	(65)

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, except share data)


	September 30, 2011		December 31, 2010
ASSETS

Current Assets:
Cash and cash equivalents	$	8	$	6
Advances to money pool		63		25
Accounts receivable – affiliates		82		126
Miscellaneous accounts and notes receivable		33		19
Materials and supplies		118		130
Mark-to-market derivative assets		10		26
Other current assets		8		4

Total current assets		322		336

Property and Plant, Net		2,219		2,248
Investments and Other Assets:
Intangible assets		-		3
Other assets		16		24

Total investments and other assets		16		27

TOTAL ASSETS	$	2,557	$	2,611

LIABILITIES AND EQUITY
Current Liabilities:
Accounts and wages payable	$	58	$	62
Accounts payable – affiliates		9		23
Current portion of tax payable – Ameren Illinois		9		8
Taxes accrued		14		20
Interest accrued		27		13
Mark-to-market derivative liabilities		3		9
Mark-to-market derivative liabilities – affiliates		-		5
Current accumulated deferred income taxes, net		13		13
Other current liabilities		15		12

Total current liabilities		148		165

Credit Facility Borrowings		-		100
Long-term Debt, Net		824		824
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		313		253
Accumulated deferred investment tax credits		3		3
Tax payable – Ameren Illinois		61		72
Asset retirement obligations		69		74
Pension and other postretirement benefits		83		88
Other deferred credits and liabilities		14		23

Total deferred credits and other liabilities		543		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		422		393
Accumulated other comprehensive loss		(42)		(44)

Total Ameren Energy Generating Company stockholder’s equity		1,029		998
Noncontrolling Interest		13		11

Total equity		1,042		1,009

TOTAL LIABILITIES AND EQUITY	$	2,557	$	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)


	Nine Months Ended September 30,
	2011		2010
Cash Flows From Operating Activities:
Net income (loss)	$	31	$	(62)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Goodwill, impairment and other charges		36		170
Loss on sales of emission allowances		-		3
Gain on sales of properties		(12)		(5)
Net mark-to-market (gain) loss on derivatives		5		(2)
Depreciation and amortization		75		87
Amortization of debt issuance costs and premium/discounts		2		2
Deferred income taxes and investment tax credits, net		58		5
Changes in assets and liabilities:
Receivables		9		55
Materials and supplies		6		43
Accounts and wages payable		(16)		(20)
Taxes accrued		(6)		10
Assets, other		3		8
Liabilities, other		(9)		(4)
Pension and other postretirement benefits		(3)		3

Net cash provided by operating activities		179		293

Cash Flows From Investing Activities:
Capital expenditures		(112)		(71)
Proceeds from sales of properties		49		18
Money pool advances, net		(38)		(132)

Net cash used in investing activities		(101)		(185)

Cash Flows From Financing Activities:
Capital issuance costs		-		(4)
Credit facility repayments, net		(100)		-
Note payable – affiliates		-		(103)
Capital contribution from parent		24		-

Net cash used in financing activities		(76)		(107)

Net change in cash and cash equivalents		2		1
Cash and cash equivalents at beginning of year		6		6

Cash and cash equivalents at end of period	$	8	$	7

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)

September 30, 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 and in the Form 10-K.

•

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.

•

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

•

Resources Company, or Ameren Energy Resources Company, LLC, consists of non-rate-regulated operations, including Ameren Energy Generating Company (Genco), AmerenEnergy Resources Generating Company (AERG), Ameren Energy Marketing Company (Marketing Company) and AmerenEnergy Medina Valley Cogen, LLC (Medina Valley). Genco operates a merchant electric generation business in Illinois. Genco has an 80% ownership interest in EEI.

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

On October 1, 2010, Ameren, CIPS, CILCO, IP, AERG and Resources Company completed a two-step corporate internal reorganization. The first step of the reorganization was the Ameren Illinois Merger. Upon consummation of the Ameren Illinois Merger, the separate legal existence of CILCO and IP terminated. The second step of the reorganization involved the distribution of AERG stock from Ameren Illinois to Ameren and the subsequent contribution by Ameren of the AERG stock to Resources Company. The Ameren Illinois Merger and the distribution of AERG stock were accounted for as transactions between entities under common control. In accordance with authoritative accounting guidance, assets and liabilities transferred between entities under common control were accounted for at the historical cost basis of the common parent, Ameren, as if the transfer had occurred at the beginning of the earliest reporting period presented. Ameren’s historical cost basis in Ameren Illinois included purchase accounting adjustments related to Ameren’s acquisition of CILCORP in 2003. Ameren Illinois accounted for the AERG distribution as a spinoff. Ameren Illinois transferred AERG to Ameren based on AERG’s carrying value. Ameren Illinois has segregated AERG’s operating results and cash flows and presented them separately as discontinued operations in its consolidated statement of income and consolidated statement of cash flows, respectively, for all periods presented prior to October 1, 2010, in this report. For Ameren’s financial statements, AERG’s results of operations remain classified as continuing operations. See Note 14 - Discontinued Operations for additional information.

The financial statements of Ameren, Ameren Illinois and Genco are prepared on a consolidated basis. Ameren Missouri has no subsidiaries, and therefore its financial statements were not prepared on a consolidated basis. All significant intercompany transactions have been eliminated. All tabular dollar amounts are in millions, unless otherwise indicated.

Our accounting policies conform to GAAP. Our financial statements reflect all adjustments (which include normal, recurring adjustments) that are necessary, in our opinion, for a fair presentation of our results. The preparation of financial statements in conformity with GAAP requires 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.

During the second quarter 2011, Genco identified an error in the cash flow statement classification of a capital contribution from Ameren that impacted Genco’s year ended December 31, 2010, and three months ended March 31, 2011, consolidated statements of cash flows. For the year ended December 31, 2010, Genco’s reported cash flows

provided by operating activities were $280 million and cash flows used in financing activities were $251 million. As corrected, Genco’s cash flows provided by operating activities were $304 million and cash flows used in financing activities were $275 million. For the three months ended March 31, 2011, Genco’s reported cash flows provided by operating activities were $100 million, and Genco had no reported cash flows from financing activities. As corrected, Genco’s cash flows provided by operating activities were $76 million and cash flows provided by financing activities were $24 million. The error was corrected in Genco’s six months ended June 30, 2011, consolidated statement of cash flows, included in the Form 10-Q for the quarter ended June 30, 2011. This correction had no impact on Ameren’s previously reported consolidated statement of cash flows.

Earnings Per Share

There were no material differences between Ameren’s basic and diluted earnings per share amounts for the three months and nine months ended September 30, 2011, and 2010. The number of restricted stock shares and performance share units outstanding had an immaterial impact on earnings per share.

Accounting Changes

Disclosures about Fair Value Measurements

See Note 7 - Fair Value Measurements for recently adopted guidance on fair value measurements.

In May 2011, FASB issued authoritative guidance regarding fair value measurements. The guidance amends the disclosure requirements for fair value measurements in order to align the principles for fair value measurements and the related disclosure requirements under GAAP and International Financial Reporting Standards. The amendments will not impact the Ameren Companies’ results of operations, financial positions, or liquidity, as this guidance only requires additional disclosures. This guidance will become effective for the Ameren Companies for periods starting after December 31, 2011.

Presentation of Comprehensive Income

In June 2011, FASB amended its guidance on the presentation of comprehensive income in financial statements. The amended guidance with respect to comprehensive income will not impact the Ameren Companies’ results of operations, financial positions, or liquidity. The amended guidance will not impact the items that must be reported in other comprehensive income or when an item of other comprehensive income must be reclassified to net income. The amended guidance will only change the presentation of comprehensive income in the financial statements. The new accounting guidance requires entities to report components of comprehensive income in either a continuous statement of comprehensive income or two separate but consecutive statements. This guidance will become effective for the Ameren Companies for periods starting after December 31, 2011.

Testing of Goodwill for Impairment

In September 2011, FASB amended its guidance for the testing of goodwill impairment. The amendments allow the option to make a qualitative evaluation about the likelihood of goodwill impairment to determine whether an estimated fair value of a reporting unit should be calculated. If the qualitative evaluation yields support that the fair value of the reporting unit exceeds its carrying value, the quantitative impairment test is not required. This guidance will become effective for periods starting after December 31, 2011. Early adoption of the guidance is permitted, and Ameren and Ameren Illinois anticipate adopting the guidance for the annual goodwill impairment test performed as of October 31, 2011.

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 September 30, 2011, Ameren’s and Ameren Illinois’ 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. During the third quarter of 2010, Ameren and Genco each recorded a noncash goodwill impairment charge, which was reflected in “Goodwill, impairment and other charges” in their statements of income. See Note 17 - Goodwill and Other Asset Impairments under Part II, Item 8, of the Form 10-K for additional information about the prior-year impairment charge.

Intangible Assets. Ameren, Ameren Missouri and Genco classify emission allowances and renewable energy credits as intangible assets. We evaluate intangible assets for impairment if events or changes in circumstances indicate that their carrying amount might be impaired.

In July 2011, the EPA issued the CSAPR, which created new allowances for SO₂ and NO_x emissions, and restricted the use of pre-existing SO₂and NO_x allowances to the acid rain program and NO_x budget trading program, respectively. In anticipation of the CSAPR announcement, observable market prices for existing emission allowances declined materially. Consequently, during the second quarter of 2011, Ameren and Genco recorded a noncash pretax impairment charge of $2 million and $1 million, respectively, which was reflected in “Goodwill, impairment and other charges” on their

statements of income. Ameren Missouri recorded a $1 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to the SO₂emission allowances, which had no impact to earnings. See Note 9 - Commitments and Contingencies for additional information on emission allowances and the CSAPR. During the third quarter of 2010, Ameren and Genco each recognized an impairment charge of its intangible assets to reduce the carrying value of their SO₂ emission allowances. The charge was reflected in “Goodwill, impairment and other charges” in their statements of income. See Note 17 - Goodwill and Other Asset Impairments under Part II, Item 8, of the Form 10-K for additional information about the prior-year impairment charge.

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, net of gains from emission allowance sales, for Ameren, Ameren Missouri and Genco during the three and nine months ended September 30, 2011, and 2010. The table below does not include the intangible asset impairment charges referenced above.


	Three Months						Nine Months
	2011			2010			2011			2010
Ameren^(a)	$	(b	)	$	10		$	2		$	20
Ameren Missouri		-			(b	)		-			(b	)
Genco^(a)		(b	)		8			2			16
AERG^(a)		(b	)		2			(b	)		4

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

(b)	Less than $1 million.

At September 30, 2011, Ameren’s and Ameren Missouri’s intangible assets also included renewable energy credits obtained through wind and solar power purchase agreements. The book value of each of Ameren’s and Ameren Missouri’s renewable energy credits as of September 30, 2011, was $5 million.

Excise Taxes

Excise taxes imposed on us are reflected on Ameren Missouri electric and natural gas customer bills and Ameren Illinois 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 Ameren Illinois electric customer bills are imposed on the consumer and are therefore not included in revenues and expenses. They are recorded as tax collections payable and included in “Taxes accrued” on the balance sheet. The following table presents excise taxes recorded in “Operating Revenues” and “Operating Expenses - Taxes other than income taxes” for the three and nine months ended September 30, 2011, and 2010:


	Three Months				Nine Months
	2011		2010		2011		2010
Ameren Missouri	$	47	$	45	$	110	$	103
Ameren Illinois		10		9		42		41
Ameren	$	57	$	54	$	152	$	144

Uncertain Tax Positions

The amount of unrecognized tax benefits as of September 30, 2011, was $189 million, $144 million, $30 million, and $11 million for Ameren, Ameren Missouri, Ameren Illinois and Genco, respectively. The amount of unrecognized tax benefits (detriments) as of September 30, 2011, that would impact the effective tax rate, if recognized, was $3 million, $1 million, less than $(1) million and $1 million for Ameren, Ameren Missouri, Ameren Illinois and Genco, respectively.

In the second quarter of 2011, final settlement for the years 2005 and 2006 was reached with the Internal Revenue Service, which resulted in the reduction of uncertain tax liabilities by $39 million, $17 million, $12 million and $4 million for Ameren, Ameren Missouri, Ameren Illinois and Genco, respectively. Ameren’s federal income tax returns for the years 2007 through 2009 are before the Appeals Office of the Internal Revenue Service. Ameren’s federal income tax return for the year 2010 is currently under examination.

State income tax returns are generally subject to examination for a period of three years after filing of the return. The 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

The following table provides a reconciliation of the beginning and ending carrying amount of AROs for the nine months ended September, 30 2011:


	Ameren^(a)(b)			Ameren Missouri^(b)			Ameren Illinois^(c⁾			Genco			AERG
Balance at December 31, 2010	$	475		$	363		$	3		$	74		$	35
Liabilities incurred		(d	)		-			-			(d	)		-
Liabilities settled		(2	)		(1	)		(d	)		(1	)		(d	)
Accretion in 2011^(e)		21			16			(d	)		4			1
Change in estimates^(f)		(49	)		(44	)		(d	)		(2	)		(3	)
Balance at September 30, 2011	$	445	^(g)	$	334		$	3		$	75	^(g)	$	33

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

(b)	The nuclear decommissioning trust fund assets of $330 million and $337 million as of September 30, 2011, and December 31, 2010, respectively, were restricted for decommissioning of the Callaway energy center.

(c)	Balance included in “Other deferred credits and liabilities” on the balance sheet.

(d)	Less than $1 million.

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

(f)

Ameren Missouri changed estimates related to its Callaway energy center decommissioning costs because of a cost study performed in 2011 and a decline in the cost escalation factor assumptions. Ameren Missouri and Genco changed estimates related to retirement costs for asbestos removal and river structures. Additionally, Genco and AERG changed estimates related to retirement costs for their coal combustion byproduct storage areas.

(g)	Balance included $6 million in “Other current liabilities” on the balance sheet as of September 30, 2011.

Noncontrolling Interests

Ameren’s noncontrolling interests comprised the 20% of EEI not owned by Ameren and the preferred stock not subject to mandatory redemption of Ameren’s subsidiaries. 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 interests at Ameren and Genco for the three and nine months ended September 30, 2011, and 2010, is shown below:


	Three Months						Nine Months
	2011			2010			2011			2010
Ameren:
Noncontrolling interest, beginning of period	$	155		$	206		$	154		$	204
Net income attributable to noncontrolling interest		2			3			6			10
Dividends paid to noncontrolling interest holders		(2	)		(2	)		(5	)		(7	)
Purchase of subsidiary preferred shares from noncontrolling interests^(a)		-			(52	)		-			(52	)
Noncontrolling interest, end of period	$	155		$	155		$	155		$	155
Genco:
Noncontrolling interest, beginning of period	$	12		$	11		$	11		$	9
Net income attributable to noncontrolling interest		1			1			2			3
Noncontrolling interest, end of period	$	13		$	12		$	13		$	12

(a)	Represents preferred stock redemptions of $33 million and $19 million by Ameren Missouri and CILCO, respectively.

Genco Asset Sale

In June 2011, Genco completed the sale of its remaining interest in the Columbia CT facility to the city of Columbia, Missouri. Genco received cash proceeds of $45 million from the sale. Genco recognized an $8 million pretax gain during the second quarter of 2011 relating to this sale. Effective with the sale, the power purchase agreements between Marketing Company and the city of Columbia were terminated.

Closure of Meredosia and Hutsonville Energy Centers

On October 4, 2011, Resources Company announced that a total of four currently operating units at Genco’s Meredosia and Hutsonville energy centers will cease operating at the end of 2011. The closure of these units will result in the elimination of 90 positions. Ameren and Genco each recorded the following pretax charges to earnings during the third quarter of 2011 related to the planned closure of these energy centers:

•

a $26 million non-cash impairment of plant book value;

•

a $5 million non-cash impairment of materials and supplies; and

•

a $4 million estimate for future cash severance costs.

These charges were recorded in Ameren’s and Genco’s statements of income as “Goodwill, impairment and other charges” and were included in the Merchant Generation segment results. Ameren and Genco anticipate that substantially all of the severance will be paid during the first quarter of 2012.

Ameren and Genco expect to receive cash tax benefits of $22 million and $33 million, respectively, as a result of the closure of these units. Previously recorded AROs for ash pond closures, and river structure and asbestos removals, for these energy centers were $38 million. Ameren and Genco expect cash expenditures over the next ten years along with associated cash tax benefits of $16 million.

The closure of these units is primarily the result of the expected cost of complying with the CSAPR, which was issued in July 2011. Genco determined that CSAPR compliance options for these four units were uneconomical. Another factor driving the closure of these facilities was a lack of a multi-year capacity market managed by MISO, without which Genco was not positioned to make the substantial investment for environmental controls that would be required to keep these units in service.

In addition, during the third quarter of 2010, Ameren and Genco each recognized long-lived asset impairment charges. See Note 17 - Goodwill and Other Asset Impairments under Part II, Item 8, of the Form 10-K for additional information about the prior-year impairment charge.

Employee Separation

On October 21, 2011, Ameren announced that, as part of its efforts to reduce its operations and maintenance expenses, it was extending a voluntary separation offer to approximately 715 management and labor union-represented employees who are 58 years of age or older as of December 31, 2011. This program is being offered to eligible employees at Ameren Missouri and at Ameren Services. Employees who accept the separation offer will receive benefits consistent with Ameren’s standard management severance benefits. Employees must decide whether to accept the separation offer by December 22, 2011, and those accepting are expected to leave their employment by December 31, 2011.

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 County Circuit Court), and the Cole County case was dismissed. In September 2009, the Stoddard County 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 County Circuit Court’s registry the entire amount of its monthly base rate increase and monthly FAC payments. In June 2010, when the May 2010 electric rate order became effective, Noranda ceased making base rate payments into the Stoddard County Circuit Court’s registry. Noranda continued to pay into the Stoddard County Circuit Court’s registry its monthly FAC payments that related to electric service received 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 would be the last possible contested amount that could be deposited into the Stoddard County Circuit Court’s registry relating to this 2009 electric rate order appeal. As of September 30, 2011, the aggregate amount held in the Stoddard County Circuit Court’s registry was $18 million.

In August 2010, the Stoddard County Circuit Court issued a judgment that reversed parts of the MoPSC’s decision. Also, upon issuance, the Stoddard County Circuit Court suspended its own judgment. Therefore, the entire amount held in the Stoddard County Circuit Court’s registry will remain in the Stoddard County 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. In November 2011, the Missouri Court of Appeals issued a ruling that upheld the MoPSC’s January 2009 electric rate order; thereby reversing the Stoddard County Circuit Court’s August 2010 decision. Noranda and MoOPC could request further appeals by early 2012. If the MoPSC’s January 2009 electric rate order is ultimately upheld, Ameren Missouri will receive all of the funds held in the Stoddard County Circuit Court’s registry, plus accrued interest. As a result of the Missouri Court of Appeals ruling, Ameren Missouri anticipates that the Stoddard County Circuit Court will release to Ameren Missouri the amount held in its registry by early 2012, depending on additional court proceedings.

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 base rate billings under 2010 electric rates and 2007 electric rates, as well as their FAC amounts to the extent those billings relate to service prior to the effective date of the new rates established by the 2011 electric rate order. Because of the lag between accumulations of changes in net fuel costs and when those net fuel costs are recovered through FAC charges applied to customers’ bills, the four industrial customers will continue to pay a portion of their FAC payments to the Cole County Circuit Court’s registry to the extent those payments relate to service prior to the effective date of the new rates by the 2011 electric rate order. It is expected that a portion of the FAC billings invoiced to these customers in September 2012 will be the last contested amount deposited into the Cole County Circuit Court’s registry relating to this 2010 electric rate order appeal. As of September 30, 2011, the aggregate amount held by the Cole County Circuit Court, excluding the bond amount, was $14 million. A decision is expected to be issued on the MIEC’s and MoOPC’s appeal by the Cole County Circuit Court in 2011 or early 2012.

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 MoPSC 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 becomes 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.

2011 Electric Rate Order

On July 13, 2011, the MoPSC issued an order approving an increase for Ameren Missouri in annual revenues for electric service of approximately $173 million, including $52 million related to an increase in normalized net fuel costs above the net fuel costs included in base rates previously authorized by the MoPSC in its May 2010 electric rate order. The revenue increase was based on a 10.2% return on equity, a capital structure composed of 52.2% common equity, and a rate base of approximately $6.6 billion. The rate changes became effective on July 31, 2011. The MoPSC order approved the continued use of Ameren Missouri’s vegetation

management and infrastructure cost tracker, pension and postretirement benefit cost tracker, and FAC at the current 95% sharing level. The MoPSC order shortened the FAC recovery and refund period from 12 months to 8 months. The MoPSC order denied Ameren Missouri’s request for the ability to recover any under-recovery of fixed costs as a result of lower sales volumes from the implementation of energy efficiency measures.

Additionally, the MoPSC order provided for a tracking mechanism for uncertain income tax positions. The order provides that reserves for uncertain tax positions do not reduce rate base. However, when an uncertain tax position liability is resolved, the order requires the creation of a regulatory asset or regulatory liability to reflect the time value (using the weighted average cost of capital in the order) of the difference between the uncertain tax position liability that was excluded from rate base and the final tax liability. The resulting regulatory asset or liability will be amortized over three years beginning on the effective date of new rates established in the next electric rate case.

The 2011 electric rate order also allowed for the full recovery of investments for the Sioux energy center scrubbers and related 2011 property taxes for the Sioux and Taum Sauk energy centers. However, the MoPSC order disallowed the recovery of all costs of enhancements, or costs that would have been incurred absent the breach, related to the rebuilding of the Taum Sauk energy center in excess of amounts recovered from property insurance. As a result of the order, Ameren and Ameren Missouri each recorded a pretax charge to earnings of $89 million, relating to the Taum Sauk disallowance, in the quarter ended September 30, 2011. This charge was recorded on Ameren’s statement of income as “Goodwill, impairment and other charges” and recorded on Ameren Missouri’s statement of income as “Loss from regulatory disallowance.”

Further, the MoPSC order adjusted or established the recovery period of multiple regulatory assets and regulatory liabilities. The following table summarizes the changes to the recovery period of regulatory assets and regulatory liabilities as directed in the MoPSC’s July 2011 rate order. The recovery periods became effective on August 1, 2011.


Regulatory Assets and Liabilities	Regulatory Asset (Liability) Balance at July 31, 2011 ⁽^a)			Recovery Period Ends
Demand-side costs⁽^b⁾	$	33			July 2017
Construction accounting for pollution control equipment⁽^b⁾		25			Sept. 2033
SO₂ emissions allowances sales tracker⁽^c⁾		8			July 2013
FERC-ordered MISO resettlements⁽^c⁾		2			July 2013
2006 Storm costs⁽^c⁾		1			July 2013
Vegetation management and infrastructure inspection⁽^c⁾		(3	)		July 2013
Pension and postretirement benefit cost tracker for 2010 costs⁽^b⁾		(11	)		July 2016
Total	$	55

(a)	Represents amounts capitalized at implementation of the rate order at July 31, 2011, and excludes the impact of subsequent amortization of the regulatory assets or liabilities.

(b)	Recovery period first established in the MoPSC’s July 2011 rate order.

(c)	Previous recovery period was extended.

On July 1, 2011, a new law took effect that reformed the judicial appeal process for MoPSC rate orders. Among other items, the new law allows appeals to be made directly to the appellate court, bypassing the circuit court. The new law provides that rates cannot be stayed; however, the appellate court could direct the MoPSC to revise rates. Such rate revisions could be ordered to be applied retroactively. The provisions of this new law apply to any judicial appeals of the MoPSC’s July 2011 rate order.

In July 2011, Ameren Missouri and other parties to the rate case filed a rehearing request of various aspects of the order including the disallowance of Taum Sauk enhancements. The MoPSC denied the requests. Subsequently, Ameren Missouri appealed the disallowance of Taum Sauk enhancements to the Missouri Court of Appeals, Western District. MIEC also appealed certain aspects of the MoPSC’s electric rate order to the Missouri Court of Appeals, Western District. A decision is expected by the Missouri Court of Appeals, Western District, in 2012. Ameren Missouri cannot predict the ultimate outcome of these appeals.

FAC Prudence Review

Missouri law requires the MoPSC to complete prudence reviews of Ameren Missouri’s FAC at least every 18 months. In April 2011, the MoPSC issued an order with respect to its prudence 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. As a result of the order, Ameren Missouri recorded a pretax charge to earnings of $18 million, including $1 million for interest, in the second quarter of 2011 for its obligation to refund to Ameren Missouri’s electric customers the earnings associated with these sales previously recognized by Ameren Missouri during the period from March 1, 2009, to September 30, 2009. In October 2011, Ameren Missouri began refunding the $18 million to customers, through the FAC.

Ameren Missouri disagrees with the MoPSC order’s classification of these sales and believes that the terms of its FAC tariff did not provide for the inclusion of these sales in the FAC calculation. In May 2011, Ameren Missouri filed a rehearing request with the MoPSC, which was denied. In June 2011, Ameren Missouri filed an appeal with the Cole County Circuit Court. A decision is expected from the Cole County Circuit Court in late 2011 or in 2012. Separately, in July 2011, Ameren Missouri filed a request with the MoPSC for an accounting authority order that would allow Ameren Missouri to defer, as a regulatory asset, fixed costs totaling $36 million that were not recovered from Noranda as a result of the loss of load caused by the severe 2009 ice storm for potential recovery in a future electric rate case. We cannot predict the ultimate outcome of these regulatory or judicial proceedings.

Ameren Missouri recognized an additional $25 million of pretax earnings associated with the same long-term partial requirements sales contracts subsequent to September 30, 2009. The MoPSC order issued in April 2011 did not address any pretax earnings associated with the same long-term partial requirements contracts subsequent to September 30, 2009. The MoPSC’s FAC prudence review for the period from October 1, 2009, to May 31, 2011, was initiated in September 2011. On October 28, 2011, the MoPSC staff filed a recommendation with the MoPSC to direct Ameren Missouri to refund to customers, prior to the completion of the staff’s prudence review, the pretax earnings associated with the same long-term partial requirements sales contracts subsequent to September 30, 2009. The MoPSC staff calculated these pretax earnings to be $26 million. We cannot predict whether the MoPSC will approve this recommendation. If Ameren Missouri were to determine that these sales were probable of refund to Ameren Missouri’s electric customers, a charge to earnings would be recorded for the refund in the period in which that determination was made. Because of pending court appeals and regulatory review, Ameren Missouri does not believe these amounts are currently probable of refund to customers.

Illinois

Pending Electric and Natural Gas Delivery Service Rate Cases

In February 2011, Ameren Illinois filed a request with the ICC to increase its annual revenues for electric delivery service. The currently pending request, as revised, seeks to increase annual revenues for electric delivery service by $39 million. The revised electric rate increase request was based on an 11.0% return on equity, a capital structure composed of 52.9% common equity, and a rate base of $2 billion.

In February 2011, Ameren Illinois also filed a request with the ICC to increase its annual revenues for natural gas delivery service. The currently pending request, as revised, seeks to increase annual revenues for natural gas delivery service by $50 million. The revised natural gas rate increase request was based on a 10.75% return on equity, a capital structure composed of 52.9% common equity, and a rate base of $956 million.

In an attempt to reduce regulatory lag, Ameren Illinois used a future test year, 2012, in each of these rate requests.

In its response to Ameren Illinois’ rate increase requests the ICC staff recommended an increase in annual revenues for electric delivery service of $4 million, based on a 9.72% return on equity, a capital structure composed of 51.8% common equity, and a rate base of $2 billion. The ICC staff recommended an increase in annual revenues for natural gas delivery service of $29 million, based on an 8.9% return on equity, a capital structure composed of 51.8% common equity, and a rate base of $945 million. Other parties also made recommendations through testimony filed in the electric and natural gas delivery service rate cases.

A decision by the ICC in these proceedings is required in January 2012. Ameren Illinois 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 Ameren Illinois to recover its costs and earn a reasonable return on its investments when the rate changes go into effect.

In October 2011, as discussed below, the Energy Infrastructure Modernization Act was enacted in Illinois. Ameren Illinois plans to participate by adopting the performance-based formula process of the law and by withdrawing its pending electric delivery service rate case.

Energy Infrastructure Modernization Act

In October 2011, the Energy Infrastructure Modernization Act was enacted into law and became effective immediately. Also, in October 2011, House Bill 3036, which, if enacted, would result in certain amendments to the Energy Infrastructure Modernization Act, was passed by the Illinois General Assembly. The Energy Infrastructure Modernization Act applies to certain electric utilities in Illinois on an opt-in basis. This law includes a performance-based formula process for determining rates that would provide for the recovery of actual costs of electric delivery service that are prudently incurred, reflect the utility’s actual regulated capital structure and include a formula for calculating the return on equity component of the cost of capital. House Bill 3036 modified the equity component of the formula rate to be based on the yields of 30-year United States treasury bonds plus 580 basis points, instead of 600 basis points. Participating utilities are subject to certain performance standards whereby the failure to achieve the standards will result in a reduction in the utility’s allowed return on equity calculated under the formula. Ameren Illinois would be required to invest $625 million in capital expenditures incremental to Ameren Illinois’ average capital expenditures for calendar years 2008 through 2010 over the next ten years to modernize its distribution system. Such investments are expected to encourage economic development and create an estimated 450 additional jobs within Illinois. Ameren Illinois also will be required to make a one-time $7.5 million non-recoverable donation to the Illinois Science and Energy Innovation Trust, as well as a $1 million annual donation to the trust for as long as it is under the formula ratemaking process. House Bill 3036 also would require Ameren Illinois to contribute $1 million annually for customer assistance programs for as long as it is under the formula ratemaking process, as well as require Ameren Illinois to withdraw its pending electric delivery service rate case. To become law, House Bill 3036 must be approved by the Illinois Governor, or if the Illinois Governor elects to veto the legislation, the Illinois General Assembly would have to override the veto. The formula ratemaking process is effective until the end of 2017, but could be extended by the Illinois General Assembly for an additional five years. Ameren Illinois is reviewing the final version of this law and House Bill 3036 to determine their potential impacts on Ameren’s and Ameren Illinois’ results of operations, financial position, and liquidity.

The Energy Infrastructure Modernization Act does not apply to natural gas utilities.

Federal

Electric Transmission Investment

FERC, in its order issued in May 2011, approved transmission rate incentives for ATX, Ameren Missouri and Ameren Illinois for two new transmission projects. The two projects are the Illinois River project and the Big Muddy project. These initial projects, subject to MISO approval, consist of a potential $1 billion investment in high voltage transmission assets in Illinois and Missouri. MISO approval for the Illinois River project as well as two additional projects is anticipated in December 2011. The FERC order approved the following rate mechanisms with respect to ATX’s Illinois River and Big Muddy projects:

•

Full recovery of financing costs associated with construction work in progress before the asset is placed in service;

•

Recovery of prudently incurred costs in developing project facilities that might later be abandoned due to issues outside the company’s control;

•

Use of a hypothetical capital structure reflecting the capital structure of Ameren Illinois as of December 31, 2009, which would afford ATX a capital structure that resembles that of a utility company; and

•

Permission to allow ATX to recover operating and maintenance costs incurred in the early development stages of the projects.

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

Ameren Missouri is considering filing an application to obtain an ESP from the NRC for the Callaway energy center 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. Attempts to pass legislation to maintain an option for nuclear power in the state of Missouri by recovering the costs of the ESP, subject to appropriate consumer protections, were not successful during the 2011 spring Missouri legislative session. However, support for nuclear power exists in the state of Missouri, which could lead to the passage of an ESP recovery mechanism in future legislative sessions. Ameren Missouri’s pursuit of an ESP is dependent upon enactment of a legislative framework ensuring cost recovery.

As of September 30, 2011, Ameren Missouri had capitalized approximately $68 million relating to its efforts to construct a new nuclear unit. All of these incurred costs will remain capitalized while management assesses options to maximize the value of its investment in this project. If efforts are permanently abandoned or management concludes it is probable the costs incurred will be disallowed in rates, a charge to earnings would be recognized in the period in which that determination was made.

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 facilities as of September 30, 2011, and excludes issued letters of credit:

		Ameren (Parent)			Ameren (Parent)			Ameren (Parent)
2010 Missouri Credit Agreement ($800 million)	Ameren (Parent)			Ameren Missouri			Total
Average daily borrowings outstanding during 2011	$	140		$	-		$	140
Outstanding credit facility borrowings at period end		-			-			-
Weighted-average interest rate during 2011		2.30	%		-			2.30	%
Peak credit facility borrowings during 2011^(a)	$	340		$	-		$	340
Peak interest rate during 2011		4.30	%		-			4.30	%

2010 Genco Credit Agreement ($500 million)	Ameren (Parent)			Genco			Total
Average daily borrowings outstanding during 2011	$	-		$	55		$	55
Outstanding credit facility borrowings at period end		-			-			-
Weighted-average interest rate during 2011		-			2.30	%		2.30	%
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 nine months of 2011 were $440 million.

Neither Ameren nor Ameren Illinois borrowed under the 2010 Illinois Credit Agreement during the nine months ended September 30, 2011.

The 2010 Credit Agreements are used for cash borrowings, to issue letters of credit, and to support borrowings under Ameren’s $500 million commercial paper program, Ameren Missouri’s $500 million commercial paper program and Ameren Illinois’ $500 million commercial paper program, the latter of which was created in October 2011. Any of the 2010 Credit Agreements are available to Ameren to support borrowings under Ameren’s commercial paper program, subject to borrowing sublimits. The 2010 Missouri Credit Agreement is available to support borrowings under Ameren Missouri’s commercial paper program, and the 2010 Illinois Credit Agreement is available to support borrowings under Ameren Illinois’ commercial paper program. At September 30, 2011, Ameren had $330 million of commercial paper outstanding and $15 million of letters of credit outstanding, and Ameren Missouri and Ameren Illinois had no commercial paper or letters of credit outstanding. Based on outstanding borrowings and letters of credit issued under the 2010 Credit Agreements as of September 30, 2011, as well as commercial paper outstanding as of such date, the aggregate amount of credit capacity available under the 2010 Credit Agreements at September 30, 2011, was $1.8 billion.

In June 2011, Ameren Missouri received approval from the MoPSC to extend the expiration of its borrowing sublimit under the 2010 Missouri Credit Agreement to September 10, 2013.

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

At September 30, 2011, Ameren had $330 million of commercial paper outstanding. During the first nine months of 2011, Ameren had average daily commercial paper balances outstanding of $335 million with a weighted-average interest rate of 0.85%. The peak short-term commercial paper outstanding and peak interest rate during the first nine months of 2011 were $435 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 contained in the 2010 Credit Agreements and the $20 Million Facility. See Note 4 - Credit Facility Borrowings and Liquidity under Part II, Item 8, of 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 with respect 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, Ameren Illinois and Genco to maintain consolidated indebtedness of not more than 65% of its consolidated total capitalization pursuant to a defined calculation set forth in the agreements. As of September 30, 2011, the ratios of consolidated indebtedness to total consolidated capitalization, calculated in accordance with the provisions of the 2010 Credit Agreements, were 48%, 46%, 40% and 45%, for Ameren, Ameren Missouri, Ameren Illinois and Genco, respectively. In addition, under the 2010 Genco Credit Agreement and the 2010 Illinois Credit Agreement, Ameren is required to maintain a ratio of consolidated funds from operations plus interest expense to consolidated interest expense of 2.0 to 1, 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 September 30, 2011, was 4.9 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 September 30, 2011, Ameren’s consolidated indebtedness ratio, calculated in accordance with the provisions of the $20 Million Facility, was 48%. 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 agreements or other financing arrangements contains credit rating triggers that would cause an event of default or acceleration of repayment of outstanding balances. At September 30, 2011, the Ameren Companies were in compliance with the provisions and covenants of their credit agreements.

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, Ameren Illinois 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 and the commercial paper programs. The total amount available to the pool participants from the utility money pool at any given time is reduced by the amount of borrowings by 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 and nine months ended September 30, 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 and the commercial paper programs 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 September 30, 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 and nine months ended September 30, 2011, was 0.83% and 0.89%, respectively (2010 - 0.34% and 0.65%, respectively).

See Note 8 - Related Party Transactions for the amount of interest income and expense from the money pool arrangements recorded by the Ameren Companies for the three and nine months ended September 30, 2011.

NOTE 4 - LONG-TERM DEBT AND EQUITY FINANCINGS

Ameren

Under DRPlus, pursuant to effective SEC Form S-3 registration statements, 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 and 1.8 million new shares valued at $49 million in the three and nine months ended September 30, 2011, respectively.

Ameren Illinois

In June 2011, Ameren Illinois’ 6.625% $150 million senior secured notes matured and were repaid and retired using available cash on hand.

Indenture Provisions and Other Covenants

Ameren Missouri’s and Ameren Illinois’ indenture provisions and articles of incorporation include covenants and provisions related to issuances of first mortgage bonds and preferred stock. Ameren Missouri and Ameren Illinois are required to meet certain ratios to issue additional first mortgage bonds and preferred stock. However, 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 September 30, 2011, at an assumed interest rate of 6% and dividend rate of 7%.


	Required Interest Coverage Ratio^(a)	Actual Interest Coverage Ratio		Bonds Issuable^(b)			Required Dividend Coverage Ratio^(c)	Actual Dividend Coverage Ratio		Preferred Stock Issuable
Ameren Missouri	³2.0		3.3	$	2,115		³2.5		89.3	$	1,696
Ameren Illinois	³2.0		7.5		3,264	^(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 $89 million and $765 million at Ameren Missouri and Ameren Illinois, respectively.

(c)	Coverage required on the annual dividend on preferred stock outstanding and to be issued, as required by the respective company’s articles of incorporation.

(d)	Amount of bonds issuable by Ameren Illinois based on unfunded property additions and retired bonds solely under the former IP mortgage indenture.

Ameren’s indenture does not require Ameren to comply with any quantitative financial covenants. The indenture does, however, include certain cross-default provisions. Specifically, either (1) the failure by Ameren to pay when due and upon expiration of any applicable grace period any portion of any Ameren indebtedness in excess of $25 million or (2) the acceleration upon default of the maturity of any Ameren indebtedness in excess of $25 million under any indebtedness agreement, including the 2010 Credit Agreements, constitutes a default under the indenture, unless such past due or accelerated debt is discharged or the acceleration is rescinded or annulled within a specified period.

Ameren Missouri, Ameren Illinois and Genco as well as certain other nonregistrant Ameren subsidiaries are subject to Section 305(a) of the Federal Power Act, which makes it unlawful for any officer or director of a public utility, as defined

in the Federal Power Act, to participate in the making or paying of any dividend from any funds “properly included in capital account.” The meaning of this limitation has never been clarified under the Federal Power Act or FERC regulations. However, FERC has consistently interpreted the provision to allow dividends to be paid as long as (1) the source of the dividends is clearly disclosed, (2) the dividends are not excessive, and (3) there is no self-dealing on the part of corporate officials. At a minimum, Ameren believes that dividends can be paid by its subsidiaries that are public utilities from net income and retained earnings. In addition, under Illinois law, Ameren Illinois may not pay any dividend on its stock, unless, among other things, its earnings and earned surplus are sufficient to declare and pay a dividend after provision is made for reasonable and proper reserves, or unless Ameren Illinois has specific authorization from the ICC.

Ameren Illinois’ articles of incorporation require its dividend payments on common stock to be based on ratios of common stock to total capitalization and other provisions related to certain operating expenses and accumulations of earned surplus. Ameren Illinois committed to FERC to maintain a minimum 30% ratio of common stock equity to total capitalization following the Ameren Illinois Merger and AERG distribution. As of September 30, 2011, Ameren Illinois’ ratio of common stock equity to total capitalization was 59%.

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 September 30, 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)

4.5

£60%^(b)

44%

(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 for the most recently ended four fiscal quarters and a debt-to-capital ratio of no greater than 60% are required for Genco to incur additional indebtedness, as defined, other than permitted indebtedness, as defined, for borrowed money. The ratios must be computed on a pro forma basis considering the additional indebtedness to be incurred and the related interest expense. Money pool borrowings are defined as permitted indebtedness and are not subject to these incurrence tests.

Genco’s debt incurrence-related ratio restrictions under its indenture may be disregarded if both Moody’s and S&P, after giving effect to additional indebtedness, each provide a rating affirmation of the rating then existing with respect with securities issued under the indenture.

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 September 30, 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 the components of “Other Income and Expenses” in the Ameren Companies’ statements of income for the three and nine months ended September 30, 2011, and 2010:


	Three Months				Nine Months
	2011		2010		2011		2010
Ameren:^(a)
Miscellaneous income:
Allowance for equity funds used during construction	$	10	$	14	$	25	$	40
Interest income on industrial development revenue bonds		7		7		21		21
Interest and dividend income		1		2		3		4
Other		-		1		2		5
Total miscellaneous income	$	18	$	24	$	51	$	70
Miscellaneous expense:
Donations	$	1	$	7	$	4	$	10
Other		4		3		11		9
Total miscellaneous expense	$	5	$	10	$	15	$	19
Ameren Missouri:
Miscellaneous income:
Allowance for equity funds used during construction	$	8	$	13	$	22	$	38
Interest income on industrial development revenue bonds		7		7		21		21
Interest and dividend income		-		2		1		3
Other		1		1		1		2
Total miscellaneous income	$	16	$	23	$	45	$	64
Miscellaneous expense:
Donations	$	1	$	7	$	3	$	8
Other		1		1		5		3
Total miscellaneous expense	$	2	$	8	$	8	$	11
Ameren Illinois:
Miscellaneous income:
Allowance for equity funds used during construction	$	2	$	-	$	3	$	1
Interest and dividend income		-		1		-		2
Other		-		1		2		3
Total miscellaneous income	$	2	$	2	$	5	$	6
Miscellaneous expense:
Donations	$	1	$	1	$	1	$	2
Other		1		1		3		4
Total miscellaneous expense	$	2	$	2	$	4	$	6
Genco:
Miscellaneous income:
Other	$	1	$	-	$	1	$	1
Total miscellaneous income	$	1	$	-	$	1	$	1
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, power, and uranium. Such price fluctuations may cause the following:

•

an unrealized appreciation or depreciation of our contracted commitments to purchase or sell when purchase or sale prices under the commitments are compared with current commodity prices;

•

market values of coal, natural gas, and uranium inventories that differ from the cost of those commodities in inventory; and

•

actual cash outlays for the purchase of these commodities that differ from anticipated cash outlays.

The derivatives that we use to hedge these risks are governed by our risk management policies for forward contracts, futures, options, and swaps. Our net positions are continually assessed within our structured hedging programs to determine whether new or offsetting transactions are required. The goal of the hedging program is generally to mitigate financial risks while ensuring that sufficient volumes are available to meet our requirements. Contracts we enter into as part of our risk management program may be settled financially, settled by physical delivery, or net settled with the counterparty.

The following table presents open gross derivative volumes by commodity type as of September 30, 2011, and December 31, 2010:


	Quantity (in millions, except as indicated)
Commodity	NPNS Contracts^(a)						Cash Flow Hedges^(b)						Other Derivatives^(c)						Derivatives That Qualify for Regulatory Deferral^(d)
	2011			2010			2011			2010			2011			2010			2011			2010
Coal (in tons)
Ameren Missouri		122			46			(e	)		(e	)		(e	)		(e	)		(e	)		(e	)
Genco		27			21			(e	)		(e	)		(e	)		(e	)		(e	)		(e	)
Other^(f)		8			6			(e	)		(e	)		(e	)		(e	)		(e	)		(e	)
Ameren		157			73			(e	)		(e	)		(e	)		(e	)		(e	)		(e	)
Heating oil (in gallons)
Ameren Missouri		(e	)		(e	)		(e	)		(e	)		(e	)		(e	)		62			80
Genco		(e	)		(e	)		(e	)		(e	)		33			43			(e	)		(e	)
Other^(f)		(e	)		(e	)		(e	)		(e	)		10			12			(e	)		(e	)
Ameren		(e	)		(e	)		(e	)		(e	)		43			55			62			80
Natural gas (in mmbtu)
Ameren Missouri		9			13			(e	)		(e	)		1			2			19			21
Ameren Illinois		51			85			(e	)		(e	)		(e	)		(e	)		188			173
Genco		(e	)		(e	)		(e	)		(e	)		5			3			(e	)		(e	)
Other^(f)		(e	)		(e	)		(e	)		(e	)		20			16			(e	)		(e	)
Ameren		60			98			(e	)		(e	)		26			21			207			194
Power (in megawatthours)
Ameren Missouri		1			2			(e	)		(e	)		-			1			5			5
Ameren Illinois		12			(e	)		(e	)		(e	)		(e	)		(e	)		27			26
Genco		(e	)		(e	)		(e	)		(e	)		-			3			(e	)		(e	)
Other^(f)		60			61			17			2			32			57			(11	)		(13	)
Ameren		73			63			17			2			32			61			21			18
Uranium (pounds in thousands)
Ameren Missouri & Ameren		5,710			5,810			(e	)		(e	)		(e	)		(e	)		308			185

(a)	Contracts through December 2017, March 2015, September 2035, and October 2024 for coal, natural gas, power, and uranium, respectively, as of September 30, 2011.

(b)	Contracts through December 2013 for power as of September 30, 2011.

(c)	Contracts through October 2014, December 2012, and April 2015 for heating oil, natural gas, and power, respectively, as of September 30, 2011.

(d)	Contracts through December 2013, October 2016, May 2032 and December 2013 for heating oil, natural gas, power, and uranium, respectively, as of September 30, 2011.

(e)	Not applicable.

(f)	Includes AERG contracts for coal and heating oil, Marketing Company contracts for natural gas and power, and intercompany eliminations for power.

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 Ameren Illinois believe derivative gains and losses deferred as regulatory assets and regulatory liabilities are probable of recovery or refund through future rates charged to customers. Regulatory assets and regulatory liabilities are amortized to operating income as related losses and gains are reflected in rates charged to customers. Therefore, gains and losses on these derivatives have no effect on operating income.

Certain derivative contracts are entered into on a regular basis as part of our risk management program but do not qualify for the NPNS exception, hedge accounting, or regulatory deferral accounting. Such contracts are recorded

at fair value, with changes in fair value charged or credited to the statement of income in the period in which the change occurs.

The following table presents the carrying value and balance sheet location of all derivative instruments as of September 30, 2011, and December 31, 2010:

	Ameren Missouri		Ameren Missouri		Ameren Missouri			Ameren Missouri			Ameren Missouri
	Balance Sheet Location	Ameren^(a)		Ameren Missouri			Ameren Illinois			Genco
2011:
Derivative assets designated as hedging instruments
Commodity contracts:
Power	MTM derivative assets	$	7	$	(b	)	$	(b	)	$	-
	Other assets		3		-			-			-
	Total assets	$	10	$	-		$	-		$	-
Derivative liabilities designated as hedging instruments
Commodity contracts:
Power	MTM derivative liabilities	$	3	$	(b	)	$	-		$	-
	Other deferred credits and liabilities		8		-			-			-
	Total liabilities	$	11	$	-		$	-		$	-
Derivative assets not designated as hedging instruments^(c)
Commodity contracts:
Heating oil	MTM derivative assets	$	28	$	(b	)	$	(b	)	$	9
	Other current assets		-		17			-			-
	Other assets		9		6			-			2
Natural gas	MTM derivative assets		6		(b	)		(b	)		1
	Other current assets		-		-			2			-
	Other assets		-		-			-			-
Power	MTM derivative assets		53

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