Edgar Filing: AMEREN CORP

ameren10q09302007.htm

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, 2007

( ) 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	Central Illinois Public Service Company	37-0211380
	(Illinois Corporation)
	607 East Adams Street
	Springfield, Illinois 62739
	(888) 789-2477

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

2-95569	CILCORP Inc.	37-1169387
	(Illinois Corporation)
	300 Liberty Street
	Peoria, Illinois 61602
	(309) 677-5271

1-2732	Central Illinois Light Company	37-0211050
	(Illinois Corporation)
	300 Liberty Street
	Peoria, Illinois 61602
	(309) 677-5271

1-3004	Illinois Power Company	37-0344645
	(Illinois Corporation)
	370 South Main Street
	Decatur, Illinois 62523
	(217) 424-6600

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. Yes (X) No ( )

Indicate by check mark whether each registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definitions of accelerated filer and large accelerated filer in Rule 12b-2 of the Securities Exchange Act of 1934.

	Large Accelerated Filer	Accelerated Filer	Non-Accelerated Filer
Ameren Corporation	(X)	( )	( )
Union Electric Company	( )	( )	(X)
Central Illinois Public Service Company	( )	( )	(X)
Ameren Energy Generating Company	( )	( )	(X)
CILCORP Inc.	( )	( )	(X)
Central Illinois Light Company	( )	( )	(X)
Illinois Power Company	( )	( )	(X)

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

Ameren Corporation	Yes	( )	No	(X)
Union Electric Company	Yes	( )	No	(X)
Central Illinois Public Service Company	Yes	( )	No	(X)
Ameren Energy Generating Company	Yes	( )	No	(X)
CILCORP Inc.	Yes	( )	No	(X)
Central Illinois Light Company	Yes	( )	No	(X)
Illinois Power Company	Yes	( )	No	(X)

The number of shares outstanding of each registrant’s classes of common stock as of November 1, 2007, was as follows:

Ameren Corporation	Common stock, $.01 par value per share – 208,009,159

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

Central Illinois Public Service 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 Development Company (parent company of the registrant and indirect subsidiary of Ameren Corporation) – 2,000

CILCORP Inc.	Common stock, no par value, held by Ameren Corporation (parent company of the registrant) – 1,000

Central Illinois Light Company	Common stock, no par value, held by CILCORP Inc. (parent company of the registrant and subsidiary of Ameren Corporation) – 13,563,871

Illinois Power Company	Common stock, no par value, held by Ameren Corporation (parent company of the registrant) – 23,000,000

OMISSION OF CERTAIN INFORMATION

Ameren Energy Generating Company and CILCORP Inc. meet the conditions set forth in General Instruction H(1)(a) and (b) of Form 10-Q and are 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, Central Illinois Public Service Company, Ameren Energy Generating Company, CILCORP Inc., Central Illinois Light Company, and Illinois Power 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 ..................................................................................................................................................................................................................	5

Forward-looking Statements ...................................................................................................................................................................................................................................	6

PART I Financial Information

Item 1. Financial Statements (Unaudited)
Ameren Corporation
Consolidated Statement of Income ................................................................................................................................................................................................	8
Consolidated Balance Sheet ...........................................................................................................................................................................................................	9
Consolidated Statement of Cash Flows ........................................................................................................................................................................................	10
Union Electric Company
Consolidated Statement of Income ................................................................................................................................................................................................	11
Consolidated Balance Sheet ...........................................................................................................................................................................................................	12
Consolidated Statement of Cash Flows ........................................................................................................................................................................................	13
Central Illinois Public Service Company
Statement of Income ........................................................................................................................................................................................................................	14
Balance Sheet ...................................................................................................................................................................................................................................	15
Statement of Cash Flows ................................................................................................................................................................................................................	16
Ameren Energy Generating Company
Consolidated Statement of Income ...............................................................................................................................................................................................	17
Consolidated Balance Sheet ..........................................................................................................................................................................................................	18
Consolidated Statement of Cash Flows .......................................................................................................................................................................................	19
CILCORP Inc.
Consolidated Statement of Income ...............................................................................................................................................................................................	20
Consolidated Balance Sheet ..........................................................................................................................................................................................................	21
Consolidated Statement of Cash Flows .......................................................................................................................................................................................	22
Central Illinois Light Company
Consolidated Statement of Income ...............................................................................................................................................................................................	23
Consolidated Balance Sheet ..........................................................................................................................................................................................................	24
Consolidated Statement of Cash Flows .......................................................................................................................................................................................	25
Illinois Power Company
Consolidated Statement of Income ..............................................................................................................................................................................................	26
Consolidated Balance Sheet .........................................................................................................................................................................................................	27
Consolidated Statement of Cash Flows ......................................................................................................................................................................................	28

Combined Notes to Financial Statements ...........................................................................................................................................................................................	29

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations ....................................................................................................	57
Item 3. Quantitative and Qualitative Disclosures About Market Risk .........................................................................................................................................................	83
Item 4. Controls and Procedures ........................................................................................................................................................................................................................	87

PART II Other Information

Item 1. Legal Proceedings ..................................................................................................................................................................................................................................	87
Item 1A.Risk Factors ..............................................................................................................................................................................................................................................	88
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds .........................................................................................................................................................	91
Item 6. Exhibits ......................................................................................................................................................................................................................................................	91

Signatures ................................................................................................................................................................................................................................................................	93

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 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. Forward-looking statements should be read with the cautionary statements and important factors included on page 6 of this Form 10-Q under the heading “Forward-looking Statements.”

GLOSSARY OF TERMS AND ABBREVIATIONS

We use the words “our,” “we” or “us” with respect to certain information that relates to all Ameren Companies, as defined below. When appropriate, subsidiaries of Ameren are named specifically as we discuss their various business activities.

AERG – AmerenEnergy Resources Generating Company, a CILCO subsidiary that operates a non-rate-regulated electric generation business in Illinois.

AFS – Ameren Energy Fuels and Services Company, a Development Company subsidiary that procures fuel and natural gas and manages the related risks for the Ameren Companies.

Ameren – Ameren Corporation and its subsidiaries on a consolidated basis. In references to financing activities, acquisition activities, or liquidity arrangements, Ameren is defined as Ameren Corporation, the parent.

Ameren Companies – The individual registrants within the Ameren consolidated group.

Ameren Energy – Ameren Energy, Inc., an Ameren Corporation subsidiary that is a power marketing and risk management agent for UE.

Ameren Illinois Utilities– CIPS, IP and the rate-regulated electric and gas utility operations of CILCO.

Ameren Services – Ameren Services Company, an Ameren Corporation subsidiary that provides support services to Ameren and its subsidiaries.

ARO– Asset retirement obligations.

Baseload – The minimum amount of electric power delivered or required over a given period of time at a steady rate.

Capacity factor– A percentage measure that indicates how much of an electric power generating unit’s capacity was used during a specific period.

CILCO – Central Illinois Light Company, a CILCORP subsidiary that operates a rate-regulated electric and natural gas transmission and distribution business and a non-rate-regulated electric generation business through AERG, all in Illinois, as AmerenCILCO. CILCO owns all of the common stock of AERG.

CILCORP – CILCORP Inc., an Ameren Corporation subsidiary that operates as a holding company for CILCO and various non-rate-regulated subsidiaries.

CIPS – Central Illinois Public Service Company, an Ameren Corporation subsidiary that operates a rate-regulated electric and natural gas transmission and distribution business in Illinois as AmerenCIPS.

CIPSCO – CIPSCO Inc., the former parent of CIPS.

CT – Combustion turbine electric generation equipment used primarily for peaking capacity.

CUB – Citizens Utility Board.

Development Company – Ameren Energy Development Company, which is a Resources Company subsidiary, and parent of Genco, Marketing Company and AFS.

DOE – Department of Energy, a U.S. government agency.

DRPlus – Ameren Corporation’s dividend reinvestment and direct stock purchase plan.

Dynegy – Dynegy Inc.

EEI – Electric Energy, Inc., an 80%-owned Ameren Corporation subsidiary (40% owned by UE and 40% owned by Development Company) that operates non-rate-regulated electric generation facilities and FERC-regulated transmission facilities in Illinois. The remaining 20% is owned by Kentucky Utilities Company.

ELPC – Environmental Law and Policy Center.

EPA – Environmental Protection Agency, a U.S. government agency.

Exchange Act – Securities Exchange Act of 1934, as amended.

FASB – Financial Accounting Standards Board, a rulemaking organization that establishes financial accounting and reporting standards in the United States.

FERC – The Federal Energy Regulatory Commission, a U.S. government agency.

FIN – FASB Interpretation. A FIN statement is an explanation intended to clarify accounting pronouncements previously issued by the FASB.

Fitch – Fitch Ratings, a credit rating agency.

Form 10-K – The combined Annual Report on Form 10-K for the year ended December 31, 2006, filed by the Ameren Companies with the SEC.

FSP– FASB Staff Position, which provides application guidance on FASB literature.

GAAP – Generally accepted accounting principles in the United States of America.

Genco – Ameren Energy Generating Company, a Development Company subsidiary that operates a non-rate-regulated electric generation business in Illinois and Missouri.

Gigawatthour – One thousand megawatthours.

Heating degree-days – The summation of negative differences between the mean daily temperature and a 65- degree Fahrenheit base. This statistic is useful as an indicator of demand for electricity and natural gas for winter space heating for residential and commercial customers.

ICC – Illinois Commerce Commission, a state agency that regulates the Illinois utility businesses and the rate-regulated operations of CIPS, CILCO and IP.

Illinois Customer Choice Law – Illinois Electric Service Customer Choice and Rate Relief Law of 1997, which provided for electric utility restructuring and introduced competition into the retail supply of electric energy in Illinois.

Illinois EPA– Illinois Environmental Protection Agency, a state government agency.

Illinois Regulated – A financial reporting segment consisting of the regulated electric and gas transmission and distribution businesses of CIPS, CILCO and IP.

IP – Illinois Power Company, an Ameren Corporation subsidiary. IP operates a rate-regulated electric and natural

gas transmission and distribution business in Illinois as AmerenIP.

IPA– Illinois Power Agency, a state government agency that has broad authority to assist in the procurement of electric power for residential and nonresidential customers beginning in June 2009.

IP LLC– Illinois Power Securitization Limited Liability Company, which is a special-purpose Delaware limited-liability company. Under FIN 46R, Consolidation of Variable-interest Entities, IP LLC was no longer consolidated within IP’s financial statements as of December 31, 2003.

IP SPT– Illinois Power Special Purpose Trust, which was created as a subsidiary of IP LLC to issue TFNs as allowed under the Illinois Customer Choice Law. Pursuant to FIN 46R, IP SPT is a variable-interest entity, as the equity investment is not sufficient to permit IP SPT to finance its activities without additional subordinated debt.

JDA – The joint dispatch agreement among UE, CIPS, and Genco under which UE and Genco jointly dispatched electric generation prior to its termination on December 31, 2006.

Kilowatthour– A measure of electricity consumption equivalent to the use of 1,000 watts of power over a period of one hour.

Marketing Company – Ameren Energy Marketing Company, a Development Company subsidiary that markets power for Genco, AERG and EEI.

Medina Valley– AmerenEnergy Medina Valley Cogen (No. 4) LLC and its subsidiaries, all Development Company subsidiaries, which indirectly own a 40-megawatt gas-fired electric generation plant.

Megawatthour – One thousand kilowatthours.

MGP – Manufactured gas plant.

MISO – Midwest Independent Transmission System Operator, Inc.

MISO Day Two Energy Market – A market that uses market-based pricing, incorporating transmission congestion and line losses, to compensate market participants for power. Missouri Regulated – A financial reporting segment consisting of all the operations of UE’s business, except for UE’s 40% interest in EEI and other non-rate-regulated activities.

Money pool – Borrowing agreements among Ameren and its subsidiaries to coordinate and provide for certain short-term cash and working capital requirements. Separate money pools are maintained for rate-regulated and non-rate-regulated businesses. These are referred to as the utility money pool and the non-state-regulated subsidiary money pool, respectively.

Moody’s – Moody’s Investors Service Inc., a credit rating agency.

MoPSC – Missouri Public Service Commission, a state agency that regulates the Missouri utility business and operations of UE.

Non-rate-regulated Generation – A financial reporting segment consisting of the operations or activities of Genco, CILCORP holding company, AERG, EEI and Marketing Company.

NO_x – Nitrogen oxide.

NRC – Nuclear Regulatory Commission, a U.S. government agency.

NYMEX – New York Mercantile Exchange.

OCI – Other comprehensive income (loss) as defined by GAAP.

Off-system– Revenues from non-native load sales.

PGA – Purchased Gas Adjustment tariffs, which allow the passing through of the actual cost of natural gas to utility customers.

PUHCA 1935 – The Public Utility Holding Company Act of 1935, which was repealed effective February 8, 2006, by the Energy Policy Act of 2005 that was enacted on August 8, 2005.

PUHCA 2005– The Public Utility Holding Company Act of 2005, enacted as part of the Energy Policy Act of 2005, effective February 8, 2006.

Resources Company – Ameren Energy Resources Company, an Ameren Corporation subsidiary that consists of non-rate-regulated operations, including Development Company, Genco, Marketing Company, AFS, and Medina Valley.

S&P – Standard & Poor’s Ratings Services, a credit rating agency that is a division of The McGraw-Hill Companies, Inc.

SEC – Securities and Exchange Commission, a U.S. government agency.

SFAS – Statement of Financial Accounting Standards, the accounting and financial reporting rules issued by the FASB.

SO₂– Sulfur dioxide.

TFN– Transitional Funding Trust Notes issued by IP SPT as allowed under the Illinois Customer Choice Law. IP must designate a portion of cash received from customer billings to pay the TFNs. The proceeds received by IP are remitted to IP SPT. The proceeds are restricted for the sole purpose of making payments of principal and interest on, and paying other fees and expenses related to, the TFNs. Since the application of FIN 46R, IP does not consolidate IP SPT. Therefore, the obligation to IP SPT appears on IP’s balance sheet.

TVA– Tennessee Valley Authority, a public power authority.

UE – 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 as AmerenUE.

_________________________________________________

FORWARD-LOOKING STATEMENTS

Statements in this report not based on historical facts are considered “forward-looking” and, accordingly, involve risks and uncertainties that could cause actual results to differ materially from those discussed. Although such forward-looking statements have been made in good faith and are

based on reasonable assumptions, there is no assurance that the expected results will be achieved. These statements include (without limitation) statements as to future expectations, beliefs, plans, strategies, objectives, events, conditions, and financial performance. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, we are providing this cautionary statement to identify important factors that could cause actual results to differ materially from those anticipated. The following factors, in addition to those discussed under Risk Factors and elsewhere in this report and in our other filings with the SEC, could cause actual results to differ materially from management expectations suggested in such forward-looking statements:

·	regulatory or legislative actions, including changes in regulatory policies and ratemaking determinations, such as the outcome of pending CIPS, CILCO and IP rate proceedings or future legislative actions that seek to limit rate increases;

·	uncertainty as to the effect of implementation of the Illinois electric settlement agreement on Ameren, the Ameren Illinois Utilities, Genco and AERG, including implementation of the new power procurement process in Illinois for 2008 and 2009;

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

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 of participation in the MISO;

the availability of fuel such as coal, natural gas, and enriched uranium used to produce electricity; the 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;

·	prices for power in the Midwest;

·	business and economic conditions, including their impact on interest rates;

·	disruptions of the capital markets or other events that make the Ameren Companies’ access to necessary capital more difficult or costly;

·	the impact of the adoption of new accounting standards and the application of appropriate technical accounting rules and guidance;

·	actions of credit rating agencies and the effects of such actions;

·	weather conditions and other natural phenomena;

·	the impact of system outages caused by severe weather conditions or other events;

·	generation plant construction, installation and performance, including costs associated with UE’s Taum Sauk pumped-storage hydroelectric plant incident and the plant’s future operation;

·	recoverability through insurance of costs associated with UE’s Taum Sauk pumped-storage hydroelectric plant incident;

·	operation of UE’s nuclear power facility, including planned and unplanned outages, and decommissioning costs;

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

·	the impact of current environmental regulations on utilities and power generating companies and the expectation that more stringent requirements, including those related to greenhouse gases, will be introduced over time, which could have a negative financial effect;

·	labor disputes, 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 and financial instruments;

·	the cost and availability of transmission capacity for the energy generated by the Ameren Companies’ facilities or required to satisfy energy sales made by the Ameren Companies;

·	legal and administrative proceedings; and

·	acts of sabotage, war, terrorism or intentionally disruptive acts.

Given these uncertainties, undue reliance should not be placed on these forward-looking statements. Except to the extent required by the federal securities laws, we undertake no obligation to update or revise publicly any forward-looking statements to reflect new information or future events.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

AMEREN CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions, except per share amounts)


	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
Operating Revenues:
Electric	$	1,872		$	1,767		$	4,844		$	4,356
Gas		125			143			895			904
Total operating revenues		1,997			1,910			5,739			5,260

Operating Expenses:
Fuel		338			277			864			776
Purchased power		419			346			1,106			896
Gas purchased for resale		68			84			622			641
Other operations and maintenance		427			395			1,249			1,141
Depreciation and amortization		169			162			514			485
Taxes other than income taxes		97			99			295			302
Total operating expenses		1,518			1,363			4,650			4,241

Operating Income		479			547			1,089			1,019

Other Income and Expenses:
Miscellaneous income		20			12			54			29
Miscellaneous expense		(6	)		(3	)		(10	)		(4	)
Total other income		14			9			44			25

Interest Charges		110			89			316			254

Income Before Income Taxes, Minority Interest
and Preferred Dividends of Subsidiaries		383			467			817			790

Income Taxes		130			161			279			273
Income Before Minority Interest and Preferred
Dividends of Subsidiaries		253			306			538			517

Minority Interest and Preferred Dividends of Subsidiaries		9			13			28			31
Net Income	$	244		$	293		$	510		$	486

Earnings per Common Share – Basic and Diluted	$	1.18		$	1.42		$	2.46		$	2.37

Dividends per Common Share	$	0.635		$	0.635		$	1.905		$	1.905
Average Common Shares Outstanding		207.6			205.9			207.1			205.4

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,		December 31,
	2007		2006
ASSETS
Current Assets:
Cash and cash equivalents	$	170	$	137
Accounts receivable – trade (less allowance for doubtful
accounts of $26 and $11, respectively)		691		418
Unbilled revenue		263		309
Miscellaneous accounts and notes receivable		258		160
Materials and supplies		757		647
Other current assets		202		203
Total current assets		2,341		1,874
Property and Plant, Net		14,729		14,286
Investments and Other Assets:
Nuclear decommissioning trust fund		301		285
Goodwill		831		831
Intangible assets		197		217
Other assets		683		654
Regulatory assets		1,323		1,431
Total investments and other assets		3,335		3,418
TOTAL ASSETS	$	20,405	$	19,578

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt	$	203	$	456
Short-term debt		1,202		612
Accounts and wages payable		415		671
Taxes accrued		136		58
Other current liabilities		548		406
Total current liabilities		2,504		2,203
Long-term Debt, Net		5,486		5,285
Preferred Stock of Subsidiary Subject to Mandatory Redemption		16		17
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		2,055		2,144
Accumulated deferred investment tax credits		111		118
Regulatory liabilities		1,241		1,234
Asset retirement obligations		571		549
Accrued pension and other postretirement benefits		1,058		1,065
Other deferred credits and liabilities		392		169
Total deferred credits and other liabilities		5,428		5,279
Preferred Stock of Subsidiaries Not Subject to Mandatory Redemption		195		195
Minority Interest in Consolidated Subsidiaries		20		16
Commitments and Contingencies (Notes 2, 8, and 9)
Stockholders' Equity:
Common stock, $.01 par value, 400.0 shares authorized –
shares outstanding of 208.0 and 206.6, respectively		2		2
Other paid-in capital, principally premium on common stock		4,579		4,495
Retained earnings		2,134		2,024
Accumulated other comprehensive income		41		62
Total stockholders’ equity		6,756		6,583
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	20,405	$	19,578

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,
	2007			2006
Cash Flows From Operating Activities:
Net income	$	510		$	486
Adjustments to reconcile net income to net cash
provided by operating activities:
Gain on sales of emission allowances		(7	)		(25	)
Depreciation and amortization		537			507
Amortization of nuclear fuel		26			26
Amortization of debt issuance costs and premium/discounts		14			12
Deferred income taxes and investment tax credits, net		18			7
Loss on sale of noncore properties		-			4
Minority interest		20			23
Other		10			17
Changes in assets and liabilities:
Receivables		(320	)		157
Materials and supplies		(110	)		(136	)
Accounts and wages payable		(113	)		(260	)
Taxes accrued		75			148
Assets, other		(20	)		(87	)
Liabilities, other		193			101
Pension and other postretirement benefit obligations		87			89
Net cash provided by operating activities		920			1,069

Cash Flows From Investing Activities:
Capital expenditures		(1,035	)		(693	)
CT acquisitions		-			(292	)
Nuclear fuel expenditures		(39	)		(37	)
Proceeds from sale of noncore properties		-			11
Purchases of securities – nuclear decommissioning trust fund		(110	)		(78	)
Sales of securities – nuclear decommissioning trust fund		98			68
Purchases of emission allowances		(12	)		(38	)
Sales of emission allowances		5			12
Other		-			3
Net cash used in investing activities		(1,093	)		(1,044	)

Cash Flows From Financing Activities:
Dividends on common stock		(395	)		(391	)
Capital issuance costs		(3	)		(4	)
Short-term debt, net		590			158
Dividends paid to minority interest		(16	)		(21	)
Redemptions, repurchases, and maturities:
Long-term debt		(465	)		(138	)
Preferred stock		(1	)		(1	)
Issuances:
Common stock		71			78
Long-term debt		425			232
Net cash provided by (used in) financing activities		206			(87	)
Net change in cash and cash equivalents		33			(62	)
Cash and cash equivalents at beginning of year		137			96
Cash and cash equivalents at end of period	$	170		$	34

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

UNION ELECTRIC COMPANY
CONSOLIDATED STATEMENT OF INCOME
(Unaudited) (In millions)

	Three Months Ended						Nine Months Ended
	September 30,						September 30,
	2007			2006			2007			2006
Operating Revenues:
Electric - excluding off-system	$	835		$	746		$	1,865		$	1,759
Electric - off-system		92			90			303			331
Gas		18			20			123			111
Other		-			1			1			2
Total operating revenues		945			857			2,292			2,203

Operating Expenses:
Fuel		179			150			447			399
Purchased power		71			64			140			199
Gas purchased for resale		9			10			73			66
Other operations and maintenance		218			214			667			581
Depreciation and amortization		81			82			252			243
Taxes other than income taxes		70			66			187			184
Total operating expenses		628			586			1,766			1,672

Operating Income		317			271			526			531

Other Income and Expenses:
Miscellaneous income		9			9			28			22
Miscellaneous expense		(5	)		(3	)		(9	)		(7	)
Total other income		4			6			19			15

Interest Charges		49			42			146			123

Income Before Income Taxes and Equity
in Income of Unconsolidated Investment		272			235			399			423

Income Taxes		93			92			132			161

Income Before Equity in Income
of Unconsolidated Investment		179			143			267			262

Equity in Income of Unconsolidated Investment,
Net of Taxes		14			23			40			47

Net Income		193			166			307			309

Preferred Stock Dividends		1			1			4			4
Net Income Available to Common Stockholder	$	192		$	165		$	303		$	305

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

UNION ELECTRIC COMPANY
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)

	September 30,		December 31,
	2007		2006
ASSETS
Current Assets:
Cash and cash equivalents	$	-	$	1
Accounts receivable – trade (less allowance for doubtful
accounts of $6 and $6, respectively)		242		145
Unbilled revenue		127		120
Miscellaneous accounts and notes receivable		207		128
Advances to money pool		13		18
Accounts receivable – affiliates		32		33
Materials and supplies		285		236
Other current assets		58		45
Total current assets		964		726
Property and Plant, Net		8,078		7,882
Investments and Other Assets:
Nuclear decommissioning trust fund		301		285
Intangible assets		60		58
Other assets		476		526
Regulatory assets		784		810
Total investments and other assets		1,621		1,679
TOTAL ASSETS	$	10,663	$	10,287

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term debt	$	152	$	5
Short-term debt		92		234
Intercompany note payable – Ameren		57		77
Accounts and wages payable		172		313
Accounts payable – affiliates		143		185
Taxes accrued		206		66
Other current liabilities		226		191
Total current liabilities		1,048		1,071
Long-term Debt, Net		3,212		2,934
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net		1,279		1,293
Accumulated deferred investment tax credits		86		89
Regulatory liabilities		850		827
Asset retirement obligations		511		491
Accrued pension and other postretirement benefits		375		374
Other deferred credits and liabilities		83		55
Total deferred credits and other liabilities		3,184		3,129
Commitments and Contingencies (Notes 2, 8 and 9)
Stockholders' Equity:
Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding		511		511
Preferred stock not subject to mandatory redemption		113		113
Other paid-in capital, principally premium on common stock		744		739
Retained earnings		1,843		1,783
Accumulated other comprehensive income		8		7
Total stockholders' equity		3,219		3,153
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	10,663	$	10,287

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

UNION ELECTRIC COMPANY
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)

	Nine Months Ended
	September 30,
	2007			2006
Cash Flows From Operating Activities:
Net income	$	307		$	309
Adjustments to reconcile net income to net cash
provided by operating activities:
Gain on sales of emission allowances		(5	)		(2	)
Depreciation and amortization		252			243
Amortization of nuclear fuel		26			26
Amortization of debt issuance costs and premium/discounts		4			4
Deferred income taxes and investment tax credits, net		19			(10	)
Other		1			-
Changes in assets and liabilities:
Receivables		(182	)		(34	)
Materials and supplies		(49	)		(35	)
Accounts and wages payable		(97	)		(110	)
Taxes accrued		140			174
Assets, other		60			(42	)
Liabilities, other		16			62
Pension and other postretirement obligations		27			35
Net cash provided by operating activities		519			620

Cash Flows From Investing Activities:
Capital expenditures		(493	)		(341	)
CT acquisitions		-			(292	)
Nuclear fuel expenditures		(39	)		(37	)
Changes in money pool advances		5			-
Proceeds from intercompany note receivable – CIPS		-			67
Purchases of securities – nuclear decommissioning trust fund		(110	)		(78	)
Sales of securities – nuclear decommissioning trust fund		98			68
Sales of emission allowances		4			2
Net cash used in investing activities		(535	)		(611	)

Cash Flows From Financing Activities:
Dividends on common stock		(246	)		(154	)
Dividends on preferred stock		(4	)		(4	)
Capital issuance costs		(3	)		-
Short-term debt, net		(142	)		128
Intercompany note payable – Ameren, net		(20	)		-
Issuances of long-term debt		425			-
Capital contribution from parent		5			3
Net cash provided by (used in) financing activities		15			(27	)
Net change in cash and cash equivalents		(1	)		(18	)
Cash and cash equivalents at beginning of year		1			20
Cash and cash equivalents at end of period	$	-		$	2

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

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
STATEMENT OF INCOME
(Unaudited) (In millions)

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
	2007			2006		2007			2006
Operating Revenues:
Electric	$	201		$	228	$	605		$	569
Gas		22			23		159			150
Other		1			3		3			4
Total operating revenues		224			254		767			723

Operating Expenses:
Purchased power		142			125		416			355
Gas purchased for resale		12			11		107			99
Other operations and maintenance		40			41		124			117
Depreciation and amortization		16			16		49			47
Taxes other than income taxes		6			9		24			30
Total operating expenses		216			202		720			648

Operating Income		8			52		47			75

Other Income and Expenses:
Miscellaneous income		5			4		13			13
Miscellaneous expense		(1	)		-		(2	)		(1	)
Total other income		4			4		11			12

Interest Charges		10			8		28			23

Income Before Income Taxes		2			48		30			64

Income Taxes		1			19		11			21

Net Income		1			29		19			43

Preferred Stock Dividends		1			1		2			2

Net Income Available to Common Stockholder	$	-		$	28	$	17		$	41

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

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
BALANCE SHEET
(Unaudited) (In millions)

	September 30,		December 31,
	2007		2006
ASSETS
Current Assets:
Cash and cash equivalents	$	1	$	6
Accounts receivable – trade (less allowance for doubtful
accounts of $6 and $2, respectively)		66		55
Unbilled revenue		36		43
Accounts receivable – affiliates		50		10
Current portion of intercompany note receivable – Genco		39		37
Current portion of intercompany tax receivable – Genco		9		9
Advances to money pool		95		1
Materials and supplies		78		71
Other current assets		53		46
Total current assets		427		278
Property and Plant, Net		1,167		1,155
Investments and Other Assets:
Intercompany note receivable – Genco		87		126
Intercompany tax receivable – Genco		107		115
Other assets		32		27
Regulatory assets		132		146
Total investments and other assets		358		414
TOTAL ASSETS	$	1,952	$	1,847

LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short-term debt	$	135	$	35
Accounts and wages payable		36		36
Accounts payable – affiliates		51		81
Taxes accrued		4		10
Other current liabilities		71		36
Total current liabilities		297		198
Long-term Debt, Net		471		471
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes and investment tax credits, net		274		297
Regulatory liabilities		229		224
Accrued pension and other postretirement benefits		83		90
Other deferred credits and liabilities		38		24
Total deferred credits and other liabilities		624		635
Commitments and Contingencies (Notes 2 and 8)
Stockholders' Equity:
Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding		-		-
Other paid-in capital		191		190
Preferred stock not subject to mandatory redemption		50		50
Retained earnings		319		302
Accumulated other comprehensive income		-		1
Total stockholders' equity		560		543
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	1,952	$	1,847

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

CENTRAL ILLINOIS PUBLIC SERVICE COMPANY
STATEMENT OF CASH FLOWS
(Unaudited) (In millions)

	Nine Months Ended
	September 30,
	2007			2006
Cash Flows From Operating Activities:
Net income	$	19		$	43
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization		49			47
Amortization of debt issuance costs and premium/discounts		1			1
Deferred income taxes and investment tax credits, net		(13	)		(27	)
Other		-			1
Changes in assets and liabilities:
Receivables		(36	)		60
Materials and supplies		(7	)		(7	)
Accounts and wages payable		(27	)		(5	)
Taxes accrued		(6	)		8
Assets, other		(8	)		-
Liabilities, other		34			-
Pension and other postretirement obligations		5			6
Net cash provided by operating activities		11			127

Cash Flows From Investing Activities:
Capital expenditures		(58	)		(63	)
Proceeds from intercompany note receivable – Genco		37			34
Changes in money pool advances		(94	)		(18	)
Net cash used in investing activities		(115	)		(47	)

Cash Flows From Financing Activities:
Dividends on common stock		-			(50	)
Dividends on preferred stock		(2	)		(2	)
Capital issuance costs		-			(1	)
Short-term debt, net		100