Edgar Filing: AMEREN CORP

10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q



ý	Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended September 30, 2015



¨	Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to



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

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

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

Indicate by check mark whether the registrants: (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.



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

Indicate by check mark whether each registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).



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

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



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

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



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

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



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

______________________________________________________________________________________________________

This combined Form 10-Q is separately filed by Ameren Corporation, Union Electric Company, and Ameren Illinois Company. Each registrant hereto is filing on its own behalf all of the information contained in this quarterly report that relates to such registrant. Each registrant hereto is not filing any information that does not relate to such registrant, and therefore makes no representation as to any such information.

TABLE OF CONTENTS



		Page
Glossary of Terms and Abbreviations		1

Forward-looking Statements		1

PART I Financial Information

Item 1.	Financial Statements (Unaudited)	3
	Ameren Corporation	3
	Consolidated Statement of Income	3
	Consolidated Statement of Comprehensive Income	4
	Consolidated Balance Sheet	5
	Consolidated Statement of Cash Flows	6
	Union Electric Company (d/b/a Ameren Missouri)	7
	Statement of Income and Comprehensive Income	7
	Balance Sheet	8
	Statement of Cash Flows	9
	Ameren Illinois Company (d/b/a Ameren Illinois)	10
	Statement of Income and Comprehensive Income	10
	Balance Sheet	11
	Statement of Cash Flows	12
	Combined Notes to Financial Statements	13
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	44
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	65
Item 4.	Controls and Procedures	66

PART II Other Information

Item 1.	Legal Proceedings	66
Item 1A.	Risk Factors	67
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	67
Item 6.	Exhibits	68

Signatures		69

This report contains “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements should be read with the cautionary statements and important factors under the heading “Forward-looking Statements.” Forward-looking statements are all statements other than statements of historical fact, including those statements that are identified by the use of the words “anticipates,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” and similar expressions.

GLOSSARY OF TERMS AND ABBREVIATIONS

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

Clean Power Plan - “Carbon Pollution Emission Guidelines for Existing Stationary Sources: Electric Utility Generating Units,” an EPA rule that establishes emission guidelines for states to follow in developing plans to reduce greenhouse gas emissions from existing fossil fuel-fired generating units.

FAC - Fuel adjustment clause, a fuel and purchased power cost recovery mechanism that allows Ameren Missouri to recover or refund, through customer rates, 95% of changes in net energy costs greater or less than the amount set in base rates without a traditional rate proceeding, subject to MoPSC prudence reviews.

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

Net energy costs - Net energy costs, as defined in the FAC, include fuel and purchased power costs, including transportation, net of off-system sales. As of May 30, 2015, transmission revenues and substantially all transmission charges are excluded from net energy costs as a result of the April 2015 MoPSC electric rate order.

Net shared benefits - Ameren Missouri’s share of the present value of lifetime energy savings, net of program costs, designed to offset sales volume reductions resulting from Ameren Missouri’s customer energy efficiency programs.

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, that may result from Ameren Illinois’ April 2015 annual electric delivery service formula update filing under the IEIMA; Ameren Illinois' January 2015 natural gas delivery service rate case filing; the complaint cases filed with the FERC seeking a reduction in the allowed base return on common equity under the MISO tariff; the complaint case filed with the MoPSC regarding the performance incentive for the 2013 through 2015 MEEIA plan; and future regulatory, judicial, or legislative actions that seek to change regulatory recovery mechanisms;

•

the effect of Ameren Illinois participating in a performance-based formula ratemaking process under the IEIMA, including the direct relationship between Ameren Illinois' return on common equity and 30-year United States Treasury bond yields, the related financial commitments required by the IEIMA, and the resulting uncertain impact on the financial condition, results of operations, and liquidity of Ameren Illinois;


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


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


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


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


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


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


•	the cost and availability of fuel such as coal, natural gas, and enriched uranium used to produce electricity; the cost and availability of purchased power and natural gas for distribution; and the level and volatility of future market prices for such commodities, including our ability to recover the costs for such commodities and our customers' tolerance for the related rate increases;


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


•	the ability to obtain sufficient insurance, including insurance relating to Ameren Missouri’s Callaway energy center, and to recover the costs of such insurance or, in the absence of insurance, the ability to recover uninsured losses;


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


•	the financial condition of Noranda and any significant reductions in the sales volumes used by its aluminum smelter in southeast Missouri below the sales volumes assumed in determining Ameren Missouri’s electric rates;


•	revisions to Ameren Missouri’s long-term power supply agreement with Noranda, including Ameren Missouri’s notification to terminate the agreement effective June 1, 2020 and Ameren Missouri’s decision whether to seek MoPSC approval to cease providing electricity to Noranda thereafter;


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


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


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


•	the impact of weather conditions and other natural phenomena on us and our customers, including the impact of system outages;


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


•	the effects of breakdowns or failures of equipment in the operation of natural gas distribution systems, such as leaks, explosions and mechanical problems, and compliance with natural gas distribution safety regulations;


•	the effects of our increasing investment in electric transmission projects and uncertainty as to whether we will achieve our expected returns in a timely fashion, if at all;


•	the extent to which Ameren Missouri prevails in its claim against an insurer in connection with the December 2005 breach of the upper reservoir at the Taum Sauk pumped-storage hydroelectric energy center;


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


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

•

the impact of current environmental regulations and new, more stringent, or changing requirements, including those related to greenhouse gases, other emissions and discharges, cooling water intake structures, CCR, and energy efficiency, that are enacted over time and that could limit or terminate the operation of certain of our energy centers, increase our costs or investment requirements, result in an impairment of our assets, cause us to sell our assets, reduce our customers' demand for electricity or natural gas, or otherwise have a negative financial effect;


•	the impact of complying with renewable energy portfolio requirements in Missouri;


•	labor disputes, work force reductions, future wage and employee benefits costs, including changes in discount rates, mortality tables, and returns on benefit plan assets;


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


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


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


•	legal and administrative proceedings; and


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

New factors emerge from time to time and it is not possible for management to predict all of such factors, nor can it assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained or implied in any forward-looking statement. 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,
	2015		2014			2015		2014
Operating Revenues:
Electric	$	1,700	$	1,523		$	4,093	$	3,864
Gas	133		147			697		819
Total operating revenues	1,833		1,670			4,790		4,683
Operating Expenses:
Fuel	259		236			670		638
Purchased power	153		114			393		340
Gas purchased for resale	38		49			320		432
Other operations and maintenance	428		402			1,256		1,231
Provision for Callaway construction and operating license (Note 2)	—		—			69		—
Depreciation and amortization	201		187			594		551
Taxes other than income taxes	128		121			369		362
Total operating expenses	1,207		1,109			3,671		3,554
Operating Income	626		561			1,119		1,129
Other Income and Expense:
Miscellaneous income	19		21			54		60
Miscellaneous expense	5		7			22		20
Total other income	14		14			32		40
Interest Charges	87		85			264		266
Income Before Income Taxes	553		490			887		903
Income Taxes	208		194			333		357
Income from Continuing Operations	345		296			554		546
Income (Loss) from Discontinued Operations, Net of Taxes (Note 12)	—		(1		)	52		(3		)
Net Income	345		295			606		543
Less: Net Income from Continuing Operations Attributable to Noncontrolling Interests	2		2			5		5
Net Income (Loss) Attributable to Ameren Common Stockholders:
Continuing Operations	343		294			549		541
Discontinued Operations	—		(1		)	52		(3		)
Net Income Attributable to Ameren Common Stockholders	$	343	$	293		$	601	$	538

Earnings (Loss) per Common Share – Basic:
Continuing Operations	$	1.42	$	1.21		$	2.27	$	2.23
Discontinued Operations	—		—			0.21		(0.01		)
Earnings per Common Share – Basic	$	1.42	$	1.21		$	2.48	$	2.22

Earnings (Loss) per Common Share – Diluted:
Continuing Operations	$	1.41	$	1.20		$	2.26	$	2.21
Discontinued Operations	—		—			0.21		(0.01		)
Earnings per Common Share – Diluted	$	1.41	$	1.20		$	2.47	$	2.20

Dividends per Common Share	$	0.41	$	0.40		$	1.23	$	1.20
Average Common Shares Outstanding – Basic	242.6		242.6			242.6		242.6
Average Common Shares Outstanding – Diluted	243.9		244.3			243.8		244.3

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

AMEREN CORPORATION

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

(Unaudited) (In millions)



	Three Months Ended September 30,					Nine Months Ended September 30,
	2015		2014			2015		2014
Income from Continuing Operations	$	345	$	296		$	554	$	546
Other Comprehensive Income from Continuing Operations, Net of Taxes
Pension and other postretirement benefit plan activity, net of income taxes of $-, $-, $4 and $3, respectively	—		—			4		3
Comprehensive Income from Continuing Operations	345		296			558		549
Less: Comprehensive Income from Continuing Operations Attributable to Noncontrolling Interests	2		2			5		5
Comprehensive Income from Continuing Operations Attributable to Ameren Common Stockholders	343		294			553		544

Income (Loss) from Discontinued Operations, Net of Taxes	—		(1		)	52		(3		)
Other Comprehensive Income from Discontinued Operations, Net of Taxes	—		—			—		—
Comprehensive Income (Loss) from Discontinued Operations Attributable to Ameren Common Stockholders	—		(1		)	52		(3		)
Comprehensive Income Attributable to Ameren Common Stockholders	$	343	$	293		$	605	$	541

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, 2015			December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	72		$	5
Accounts receivable – trade (less allowance for doubtful accounts of $20 and $21, respectively)	508			423
Unbilled revenue	234			265
Miscellaneous accounts and notes receivable	113			81
Materials and supplies	548			524
Current regulatory assets	163			295
Current accumulated deferred income taxes, net	225			352
Other current assets	103			86
Assets of discontinued operations (Note 12)	17			15
Total current assets	1,983			2,046
Property and Plant, Net	18,307			17,424
Investments and Other Assets:
Nuclear decommissioning trust fund	534			549
Goodwill	411			411
Regulatory assets	1,578			1,582
Other assets	646			664
Total investments and other assets	3,169			3,206
TOTAL ASSETS	$	23,459		$	22,676
LIABILITIES AND EQUITY
Current Liabilities:
Current maturities of long-term debt	$	395		$	120
Short-term debt	783			714
Accounts and wages payable	525			711
Taxes accrued	160			46
Interest accrued	103			85
Current regulatory liabilities	89			106
Other current liabilities	404			434
Liabilities of discontinued operations (Note 12)	30			33
Total current liabilities	2,489			2,249
Long-term Debt, Net	5,981			6,120
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net	4,084			3,923
Accumulated deferred investment tax credits	62			64
Regulatory liabilities	1,894			1,850
Asset retirement obligations	597			396
Pension and other postretirement benefits	666			705
Other deferred credits and liabilities	530			514
Total deferred credits and other liabilities	7,833			7,452
Commitments and Contingencies (Notes 2, 9, 10 and 12)
Ameren Corporation Stockholders’ Equity:
Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 242.6	2			2
Other paid-in capital, principally premium on common stock	5,612			5,617
Retained earnings	1,405			1,103
Accumulated other comprehensive loss	(5		)	(9		)
Total Ameren Corporation stockholders’ equity	7,014			6,713
Noncontrolling Interests	142			142
Total equity	7,156			6,855
TOTAL LIABILITIES AND EQUITY	$	23,459		$	22,676

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,
	2015			2014
Cash Flows From Operating Activities:
Net income	$	606		$	543
(Income) loss from discontinued operations, net of taxes	(52		)	3
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for Callaway construction and operating license	69			—
Depreciation and amortization	582			526
Amortization of nuclear fuel	71			70
Amortization of debt issuance costs and premium/discounts	16			16
Deferred income taxes and investment tax credits, net	318			370
Allowance for equity funds used during construction	(19		)	(26		)
Stock-based compensation costs	20			20
Other	(8		)	(9		)
Changes in assets and liabilities:
Receivables	(71		)	16
Materials and supplies	(23		)	(34		)
Accounts and wages payable	(172		)	(187		)
Taxes accrued	114			100
Regulatory assets and liabilities	74			(216		)
Assets, other	20			44
Liabilities, other	(41		)	(21		)
Pension and other postretirement benefits	29			(27		)
Counterparty collateral, net	—			20
Net cash provided by operating activities – continuing operations	1,533			1,208
Net cash used in operating activities – discontinued operations	(5		)	(5		)
Net cash provided by operating activities	1,528			1,203
Cash Flows From Investing Activities:
Capital expenditures	(1,332		)	(1,310		)
Nuclear fuel expenditures	(30		)	(28		)
Purchases of securities – nuclear decommissioning trust fund	(301		)	(365		)
Sales and maturities of securities – nuclear decommissioning trust fund	290			354
Proceeds from note receivable – Marketing Company	12			79
Contributions to note receivable – Marketing Company	(8		)	(84		)
Other	7			3
Net cash used in investing activities – continuing operations	(1,362		)	(1,351		)
Net cash provided by investing activities – discontinued operations	—			139
Net cash used in investing activities	(1,362		)	(1,212		)
Cash Flows From Financing Activities:
Dividends on common stock	(298		)	(291		)
Dividends paid to noncontrolling interest holders	(5		)	(5		)
Short-term debt, net	69			385
Redemptions and maturities of long-term debt	(114		)	(692		)
Issuances of long-term debt	249			598
Capital issuance costs	(2		)	(4		)
Other	2			1
Net cash used in financing activities – continuing operations	(99		)	(8		)
Net cash used in financing activities – discontinued operations	—			—
Net cash used in financing activities	(99		)	(8		)
Net change in cash and cash equivalents	67			(17		)
Cash and cash equivalents at beginning of year	5			30
Cash and cash equivalents at end of period	$	72		$	13

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

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

STATEMENT OF INCOME AND COMPREHENSIVE INCOME

(Unaudited) (In millions)



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015		2014
Operating Revenues:
Electric	$	1,151	$	1,076	$	2,752	$	2,696
Gas	19		21		101		117
Other	1		—		2		1
Total operating revenues	1,171		1,097		2,855		2,814
Operating Expenses:
Fuel	259		236		670		638
Purchased power	29		27		87		91
Gas purchased for resale	5		7		43		58
Other operations and maintenance	233		226		673		672
Provision for Callaway construction and operating license (Note 2)	—		—		69		—
Depreciation and amortization	125		118		367		351
Taxes other than income taxes	97		89		262		248
Total operating expenses	748		703		2,171		2,058
Operating Income	423		394		684		756
Other Income and Expense:
Miscellaneous income	14		15		37		45
Miscellaneous expense	3		4		8		10
Total other income	11		11		29		35
Interest Charges	54		53		164		159
Income Before Income Taxes	380		352		549		632
Income Taxes	140		129		205		234
Net Income	240		223		344		398
Other Comprehensive Income	—		—		—		—
Comprehensive Income	$	240	$	223	$	344	$	398


Net Income	$	240	$	223	$	344	$	398
Preferred Stock Dividends	1		1		3		3
Net Income Available to Common Stockholder	$	239	$	222	$	341	$	395

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

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

BALANCE SHEET

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



	September 30, 2015		December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	69	$	1
Advances to money pool	250		—
Accounts receivable – trade (less allowance for doubtful accounts of $7 and $8, respectively)	260		190
Accounts receivable – affiliates	8		65
Unbilled revenue	148		146
Miscellaneous accounts and notes receivable	62		35
Materials and supplies	374		347
Current regulatory assets	97		163
Other current assets	57		92
Total current assets	1,325		1,039
Property and Plant, Net	11,041		10,867
Investments and Other Assets:
Nuclear decommissioning trust fund	534		549
Regulatory assets	646		695
Other assets	395		391
Total investments and other assets	1,575		1,635
TOTAL ASSETS	$	13,941	$	13,541
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current maturities of long-term debt	$	266	$	120
Short-term debt	—		97
Accounts and wages payable	187		405
Accounts payable – affiliates	35		56
Taxes accrued	273		32
Interest accrued	66		58
Current regulatory liabilities	41		18
Other current liabilities	116		117
Total current liabilities	984		903
Long-term Debt, Net	3,869		3,879
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net	2,858		2,806
Accumulated deferred investment tax credits	59		61
Regulatory liabilities	1,166		1,147
Asset retirement obligations	590		389
Pension and other postretirement benefits	267		274
Other deferred credits and liabilities	30		30
Total deferred credits and other liabilities	4,970		4,707
Commitments and Contingencies (Notes 2, 8, 9 and 10)
Stockholders’ Equity:
Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding	511		511
Other paid-in capital, principally premium on common stock	1,784		1,569
Preferred stock	80		80
Retained earnings	1,743		1,892
Total stockholders’ equity	4,118		4,052
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	13,941	$	13,541

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

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

STATEMENT OF CASH FLOWS

(Unaudited) (In millions)



	Nine Months Ended September 30,
	2015			2014
Cash Flows From Operating Activities:
Net income	$	344		$	398
Adjustments to reconcile net income to net cash provided by operating activities:
Provision for Callaway construction and operating license	69			—
Depreciation and amortization	356			329
Amortization of nuclear fuel	71			70
Amortization of debt issuance costs and premium/discounts	5			5
Deferred income taxes and investment tax credits, net	88			139
Allowance for equity funds used during construction	(16		)	(24		)
Other	1			1
Changes in assets and liabilities:
Receivables	(51		)	(76		)
Materials and supplies	(26		)	3
Accounts and wages payable	(177		)	(151		)
Taxes accrued	243			(22		)
Regulatory assets and liabilities	101			(78		)
Assets, other	6			44
Liabilities, other	11			30
Pension and other postretirement benefits	15			(8		)
Net cash provided by operating activities	1,040			660
Cash Flows From Investing Activities:
Capital expenditures	(444		)	(548		)
Nuclear fuel expenditures	(30		)	(28		)
Purchases of securities – nuclear decommissioning trust fund	(301		)	(365		)
Sales and maturities of securities – nuclear decommissioning trust fund	290			354
Money pool advances, net	(250		)	—
Other	(4		)	(6		)
Net cash used in investing activities	(739		)	(593		)
Cash Flows From Financing Activities:
Dividends on common stock	(490		)	(268		)
Dividends on preferred stock	(3		)	(3		)
Short-term debt, net	(97		)	65
Money pool borrowings, net	—			(105		)
Maturities of long-term debt	(114		)	(104		)
Issuances of long-term debt	249			350
Capital contribution from parent	224			—
Capital issuance cost	(2		)	(2		)
Net cash used in financing activities	(233		)	(67		)
Net change in cash and cash equivalents	68			—
Cash and cash equivalents at beginning of year	1			1
Cash and cash equivalents at end of period	$	69		$	1

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

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

STATEMENT OF INCOME AND COMPREHENSIVE INCOME

(Unaudited) (In millions)



	Three Months Ended September 30,				Nine Months Ended September 30,
	2015		2014		2015			2014
Operating Revenues:
Electric	$	540	$	445	$	1,316		$	1,162
Gas	115		127		597			703
Total operating revenues	655		572		1,913			1,865
Operating Expenses:
Purchased power	128		89		317			256
Gas purchased for resale	33		43		277			374
Other operations and maintenance	202		185		606			580
Depreciation and amortization	74		66		220			193
Taxes other than income taxes	29		31		101			109
Total operating expenses	466		414		1,521			1,512
Operating Income	189		158		392			353
Other Income and Expense:
Miscellaneous income	4		4		15			12
Miscellaneous expense	3		2		10			7
Total other income	1		2		5			5
Interest Charges	33		31		99			90
Income Before Income Taxes	157		129		298			268
Income Taxes	59		54		114			110
Net Income	98		75		184			158
Other Comprehensive Loss, Net of Taxes:
Pension and other postretirement benefit plan activity, net of income taxes (benefit) of $(1), $(1), $(2) and $(2), respectively	—		—		(2		)	(2		)
Comprehensive Income	$	98	$	75	$	182		$	156


Net Income	$	98	$	75	$	184		$	158
Preferred Stock Dividends	—		—		2			2
Net Income Available to Common Stockholder	$	98	$	75	$	182		$	156

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

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

BALANCE SHEET

(Unaudited) (In millions)



	September 30, 2015		December 31, 2014
ASSETS
Current Assets:
Cash and cash equivalents	$	—	$	1
Accounts receivable – trade (less allowance for doubtful accounts of $13 and $13, respectively)	229		212
Accounts receivable – affiliates	1		22
Unbilled revenue	86		119
Miscellaneous accounts receivable	11		9
Materials and supplies	174		177
Current regulatory assets	65		129
Current accumulated deferred income taxes, net	50		160
Other current assets	16		15
Total current assets	632		844
Property and Plant, Net	6,615		6,165
Investments and Other Assets:
Goodwill	411		411
Regulatory assets	922		883
Other assets	76		78
Total investments and other assets	1,409		1,372
TOTAL ASSETS	$	8,656	$	8,381
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Current maturities of long-term debt	$	129	$	—
Short-term debt	—		32
Borrowings from money pool	122		15
Accounts and wages payable	251		207
Accounts payable – affiliates	36		50
Taxes accrued	7		17
Interest accrued	39		24
Customer deposits	70		77
Mark-to-market derivative liabilities	38		42
Current environmental remediation	35		52
Current regulatory liabilities	37		84
Other current liabilities	90		100
Total current liabilities	854		700
Long-term Debt, Net	2,112		2,241
Deferred Credits and Other Liabilities:
Accumulated deferred income taxes, net	1,412		1,408
Regulatory liabilities	728		703
Pension and other postretirement benefits	282		277
Environmental remediation	203		199
Other deferred credits and liabilities	224		192
Total deferred credits and other liabilities	2,849		2,779
Commitments and Contingencies (Notes 2, 8 and 9)
Stockholders’ Equity:
Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding	—		—
Other paid-in capital	1,980		1,980
Preferred stock	62		62
Retained earnings	793		611
Accumulated other comprehensive income	6		8
Total stockholders’ equity	2,841		2,661
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	8,656	$	8,381

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

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

STATEMENT OF CASH FLOWS

(Unaudited) (In millions)



	Nine Months Ended September 30,
	2015			2014
Cash Flows From Operating Activities:
Net income	$	184		$	158
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	218			190
Amortization of debt issuance costs and premium/discounts	11			10
Deferred income taxes and investment tax credits, net	108			136
Other	(7		)	(6		)
Changes in assets and liabilities:
Receivables	45			80
Materials and supplies	3			(37		)
Accounts and wages payable	11			1
Taxes accrued	(10		)	(5		)
Regulatory assets and liabilities	(31		)	(135		)
Assets, other	7			6
Liabilities, other	(13		)	(4		)
Pension and other postretirement benefits	13			(12		)
Counterparty collateral, net	2			14
Net cash provided by operating activities	541			396
Cash Flows From Investing Activities:
Capital expenditures	(620		)	(633		)
Other	5			6
Net cash used in investing activities	(615		)	(627		)
Cash Flows From Financing Activities:
Dividends on preferred stock	(2		)	(2		)
Short-term debt, net	(32		)	189
Money pool borrowings, net	107			(40		)
Redemptions of long-term debt	—			(163		)
Issuances of long-term debt	—			248
Capital issuance costs	—			(2		)
Advances received for construction	—			1
Net cash provided by financing activities	73			231
Net change in cash and cash equivalents	(1		)	—
Cash and cash equivalents at beginning of year	1			1
Cash and cash equivalents at end of period	$	—		$	1

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

AMEREN CORPORATION (Consolidated)

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

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

COMBINED NOTES TO FINANCIAL STATEMENTS

(Unaudited)

September 30, 2015

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General

Ameren, headquartered in St. Louis, Missouri, is a public utility holding company under PUHCA 2005. Ameren’s primary assets are its equity interests in its subsidiaries, including Ameren Missouri and Ameren Illinois. Ameren’s subsidiaries are separate, independent legal entities with separate businesses, assets, and liabilities. Dividends on Ameren’s common stock and the payment of expenses by Ameren depend on distributions made to it by its subsidiaries. Ameren’s principal subsidiaries are listed below. Also see the Glossary of Terms and Abbreviations at the front of this report and in the Form 10-K.


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


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

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

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

Ameren’s financial statements are prepared on a consolidated basis and therefore include the accounts of its

majority-owned subsidiaries. All intercompany transactions have been eliminated. Ameren Missouri and Ameren Illinois have no subsidiaries, and therefore their financial statements are not prepared on a consolidated basis. All tabular dollar amounts are in millions, unless otherwise indicated.

Our accounting policies conform to GAAP. Our financial statements reflect all adjustments (which include normal, recurring adjustments) that are necessary, in our opinion, for a fair presentation of our results. The preparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions. Such estimates and assumptions affect reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the dates of financial statements, and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. The results of operations of an interim period may not give a true indication of results that may be expected for a full year. These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Form 10-K.

Asset Retirement Obligations

The following table provides a reconciliation of the beginning and ending carrying amount of AROs for the nine months ended September 30, 2015:



	Ameren Missouri			Ameren Illinois^(a)		Ameren
Balance at December 31, 2014	$	389		$	7	$	396
Liabilities incurred^(b)	3			—		3
Liabilities settled	(1		)	(c)		(1		)
Accretion in 2015^(d)	17			(c)		17
Change in estimates^(e)	182			(c)		182
Balance at September 30, 2015	$	590		$	7	$	597


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


(b)	Ameren and Ameren Missouri recorded a new ARO of $3 million related to the Callaway energy center’s dry spent fuel storage facility. See Note 10 - Callaway Energy Center for additional information.


(c)	Less than $1 million.


(d)	Accretion expense was recorded as an increase to regulatory assets.

(e)

The ARO increase resulted in a corresponding increase recorded to “Property and Plant, Net.” During 2015, Ameren and Ameren Missouri increased their AROs related to the decommissioning of the Callaway energy center by $99 million to reflect the 2015 cost study and funding analysis filed with the MoPSC, extension of the estimated operating life until 2044, and a reduction in the discount rate assumption. See Note 10 - Callaway Energy Center for additional information. In addition, as a result of new federal regulations, Ameren and Ameren Missouri recorded an increase of $79 million to their AROs associated with CCR storage facilities. See Note 9 - Commitments and Contingencies for additional information. Ameren and Ameren Missouri also increased their AROs by $4 million due to a change in the estimated retirement dates of the Meramec and Rush Island energy centers as a result of the MoPSC’s April 2015 electric rate order.

Stock-based Compensation

A summary of nonvested performance share units at September 30, 2015, and changes during the nine months ended September 30, 2015, under the 2006 Incentive Plan and the 2014 Incentive Plan are presented below:



	Number of Performance Share Units		Weighted-average Fair Value Per Performance Share Unit
Nonvested at January 1, 2015	1,162,377		$	35.35
Granted^(a)	569,892		52.88
Forfeitures	(1,944	)	34.75
Vested^(b)	(92,892	)	45.97
Nonvested at September 30, 2015	1,637,433		$	40.85


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


(b)	Performance share units vested due to the attainment of retirement eligibility by certain employees. Actual shares issued for retirement-eligible employees will vary depending on actual performance over the three-year measurement period.

The fair value of each performance share unit awarded in 2015 under the 2014 Incentive Plan was determined to be $52.88, which was based on Ameren’s closing common share price of $46.13 at December 31, 2014, and lattice simulations. Lattice simulations are used to estimate expected share payout based on Ameren’s total stockholder return for a three-year performance period relative to the designated peer group beginning January 1, 2015. The simulations can produce a greater fair value for the performance share unit than the applicable closing common share price because they include the weighted payout scenarios in which an increase in the share price has occurred. The significant assumptions used to calculate fair value also included a three-year risk-free rate of 1.10%, volatility of 12% to 18% for the peer group, and Ameren’s attainment of a three-year average earnings per share threshold during the performance period.

Excise Taxes

Ameren Missouri and Ameren Illinois collect certain excise taxes from customers that are levied on the sale or distribution of natural gas and electricity. Excise taxes are levied on Ameren Missouri’s electric and natural gas businesses and on Ameren Illinois’ natural gas business and are recorded gross in “Operating Revenues - Electric,” “Operating Revenues - Gas” and “Operating Expenses - Taxes other than income taxes” on the statement of income or the statement of income and comprehensive income. Excise taxes for electric service in Illinois are levied on the customer and are therefore not included in Ameren Illinois’ revenues and expenses. The following table presents excise taxes recorded in “Operating Revenues - Electric,” “Operating Revenues - Gas” and “Operating Expenses - Taxes other than income taxes” for the three and nine months ended September 30, 2015 and 2014:



	Three Months				Nine Months
	2015		2014		2015		2014
Ameren Missouri	$	52	$	47	$	127	$	120
Ameren Illinois	9		9		42		46
Ameren	$	61	$	56	$	169	$	166

Uncertain Tax Positions

The following table presents the total amount of reserves for unrecognized tax benefits (detriments) related to uncertain tax positions as of September 30, 2015, and December 31, 2014:



	September 30, 2015		December 31, 2014
Ameren	$	—	$	54
Ameren Missouri	—		—
Ameren Illinois	—		(1		)

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



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

In June 2015, a settlement was reached with the IRS for the 2013 tax year. This settlement resolved the uncertain tax position associated with the final tax basis of New AER and the related tax benefit resulting from the divested merchant generation business. The settlement resulted in a reduction of Ameren’s unrecognized tax benefits of $53 million and an increase to net income from discontinued operations.

State income tax returns are generally subject to examination for a period of three years after filing. We do not currently have material state income tax issues under examination, administrative appeal, or litigation. The state impact of any federal changes remains subject to examination by various states for up to one year after formal notification to the states.

Earnings Per Share

Basic earnings per share is computed by dividing net income attributable to Ameren common stockholders by the weighted-average number of common shares outstanding during the period. Earnings per diluted share is computed by dividing net

income attributable to Ameren common stockholders by the weighted-average number of diluted common shares outstanding during the period. Earnings per diluted share reflects the potential dilution that would occur if certain stock-based performance share units were settled. The number of performance share units assumed to be settled was 1.3 million and 1.2 million in the three and nine months ended September 30, 2015, respectively, and 1.7 million in both of the year-ago periods. There were no potentially dilutive securities excluded from the earnings per diluted share calculations for the three and nine months ended September 30, 2015 and 2014.

Accounting and Reporting Developments

Below is a summary of recently issued authoritative accounting standards relevant to the Ameren Companies.

Revenue from Contracts with Customers

In 2014, FASB issued authoritative accounting guidance to clarify the principles for recognizing revenue and to develop a common revenue standard for GAAP. The guidance requires an entity to recognize an amount of revenue for the transfer of promised goods or services to customers that reflects the consideration which the entity expects to be entitled to in exchange for those goods or services. The guidance also requires additional disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. In August 2015, FASB deferred the effective date of this revenue standard to the first quarter of 2018, with an option for entities to early adopt in the first quarter of 2017. The guidance allows entities to choose one of two transition methods, either by applying the guidance retrospectively to each reporting period presented or by recording a cumulative effect adjustment to retained earnings in the period of initial adoption. The Ameren Companies are currently assessing the impacts of this guidance on their results of operations, financial positions and disclosures, as well as the transition method that they will use to adopt the guidance.

Presentation of Debt Issuance Costs

In April 2015, FASB issued authoritative accounting guidance to simplify the presentation of debt issuance costs. The guidance requires debt issuance costs to be presented in the balance sheet as a reduction to the associated debt liability. Currently, debt issuance costs are presented as a component of “Other assets” on the Ameren Companies’ balance sheets. As of September 30, 2015, Ameren, Ameren Missouri, and Ameren Illinois had debt issuance costs of $35 million, $15 million, and $19 million, respectively. The Ameren Companies expect to early adopt this standard in the fourth quarter of 2015. The guidance will be applied retrospectively, and will not affect the Ameren Companies' results of operations or cash flows.

NOTE 2 - RATE AND REGULATORY MATTERS

Below is a summary of updates to significant regulatory proceedings and related lawsuits. See also Note 2 - Rate and

Regulatory Matters under Part II, Item 8, of the Form 10-K. We are unable to predict the ultimate outcome of these matters, the timing of the final decisions of the various agencies and courts, or the impact on our results of operations, financial position, or liquidity.

Missouri

2015 Electric Rate Order

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

The order approved Ameren Missouri’s request for continued use of the FAC; however, it changed the FAC to exclude all transmission revenues and substantially all transmission charges. In addition, the order did not approve the continued use of the regulatory tracking mechanisms for storm costs and vegetation management and infrastructure inspection costs. These changes to Ameren Missouri’s recovery mechanisms are expected to contribute to regulatory lag. The order did approve the continued use of the regulatory tracking mechanisms for pension and other postretirement benefits, renewable energy standard costs, solar rebates, and uncertain tax positions that the MoPSC authorized in prior electric rate orders.

In addition, the order approved a reduction to Noranda’s electric rates with an offsetting increase in electric rates for Ameren Missouri’s other customers. The rate shift is revenue neutral to Ameren Missouri.

In June 2015, Ameren Missouri filed an appeal with the Missouri Court of Appeals, Western District, of the reduction to Noranda’s electric rates included in the MoPSC’s order. The outcome of this appeal is not expected to impact Ameren Missouri’s results of operations, financial position, or liquidity.

MEEIA Filing

The MEEIA established a regulatory framework that, among other things, requires the MoPSC to ensure that a utility’s financial incentives are aligned to help customers use energy more efficiently, to provide timely cost recovery, and to provide earnings opportunities associated with cost-effective energy efficiency programs. Missouri does not have a law mandating energy efficiency programs.

In August 2012, the MoPSC approved Ameren Missouri’s customer energy efficiency programs, net shared benefits, and performance incentive for 2013 through 2015. The 2013 through 2015 plan anticipated Ameren Missouri would invest up to $147

million in customer energy efficiency programs, realize $100 million of net shared benefits, and be eligible for a performance incentive that would allow it the potential to earn additional revenues by achieving certain customer energy efficiency goals, including $19 million if 100% of the goals are achieved during the three-year period, with the potential to earn a larger performance incentive if Ameren Missouri’s energy savings exceed those goals. From January 2013 through September 2015, Ameren Missouri invested $110 million in customer energy efficiency programs and realized $134 million of net shared benefits. In June 2015, the MoPSC staff filed a complaint case with the MoPSC regarding the method and inputs used in calculating the performance incentive. If the MoPSC agrees with the MoPSC staff’s interpretation of the August 2012 MEEIA order, the performance incentive recognized in 2016 would be significantly less than the performance incentive calculated using Ameren Missouri’s interpretation. Ameren Missouri has not recorded revenues associated with the performance incentive. However, regardless of the MoPSC’s decision in the complaint case, Ameren Missouri believes it will exceed 100% of the customer energy efficiency goals, subject to MoPSC review, and therefore expects to recognize revenues of at least $19 million in 2016. There is no date by which the MoPSC must issue a decision in this complaint case.

In October 2015, the MoPSC rejected Ameren Missouri’s MEEIA energy efficiency plan for 2016 through 2018, which included a portfolio of customer energy efficiency programs along with a rider to collect the program costs, net shared benefits, and a performance incentive from customers. Ameren Missouri is studying the MoPSC’s October 2015 order and evaluating whether to file another proposed energy efficiency plan with the MoPSC.

Noranda Contract Notification

Ameren Missouri supplies electricity to Noranda’s aluminum smelter in southeast Missouri under a long-term power supply agreement. In May 2015, Ameren Missouri notified Noranda of its intent to terminate the agreement effective June 1, 2020. If Ameren Missouri wanted to cease providing electricity to Noranda, Ameren Missouri would also be required to obtain approval from the MoPSC. Sales to Noranda represented 5% of Ameren Missouri’s total electric revenue in 2014.

ATXI Transmission Projects

In May 2015, the MoPSC granted ATXI a certificate of convenience and necessity for the seven-mile portion of the Illinois Rivers project located in Missouri.

In June 2015, ATXI made a filing with the MoPSC requesting a certificate of convenience and necessity for the Mark Twain project. The Mark Twain project is a MISO-approved 100-mile transmission line located in northeast Missouri. A decision is expected from the MoPSC in 2016.

Illinois

IEIMA

Under the provisions of the IEIMA’s formula rate framework, which currently extends through 2019, Ameren Illinois’ electric delivery service rates are subject to an annual revenue requirement reconciliation to its actual recoverable costs. Throughout each year, Ameren Illinois records a regulatory asset or a regulatory liability and a corresponding increase or decrease to operating revenues for any differences between the revenue requirement reflected in customer rates for that year and its estimate of the probable increase or decrease in the revenue requirement expected to ultimately be approved by the ICC based on that year's actual recoverable costs incurred. As of September 30, 2015, Ameren Illinois had recorded regulatory assets of $52 million, $103 million, and $14 million, to reflect its expected 2015, 2014, and 2013 revenue requirement reconciliation adjustments, with interest, respectively. Ameren Illinois is collecting the 2013 revenue requirement reconciliation adjustment from customers during 2015.

Ameren Illinois’ annual electric delivery service formula rate update to establish customer rates for 2016 is currently pending before the ICC. If the ICC approves as filed, the annual update filing would result in a $109 million increase in Ameren Illinois’ electric delivery service revenue requirement, beginning in January 2016. This update reflects an increase to the annual formula rate based on 2014 actual recoverable costs and expected net plant additions for 2015, an increase to include the 2014 revenue requirement reconciliation adjustment, and a decrease for the conclusion of the 2013 revenue requirement reconciliation adjustment, which will be fully collected from customers in 2015. In October 2015, the ICC staff submitted its calculation of Ameren Illinois’ revenue requirement. The ICC staff recommended adjustments that would result in a $107 million increase in Ameren Illinois’ electric delivery service revenue

requirement. An ICC decision on this update filing is required by December 2015.

2015 Natural Gas Delivery Service Rate Case

In January 2015, Ameren Illinois filed a request with the ICC seeking approval to increase its annual revenues for natural gas delivery service. In an attempt to reduce regulatory lag, Ameren Illinois used a 2016 future test year in this proceeding. Additionally, the request included a proposal to implement a volume balancing adjustment for residential and small nonresidential customers. The volume balancing adjustment would increase or decrease revenues as weather deviates from normal conditions to ensure that weather-related changes in natural gas sales volumes do not result in an over or under collection of natural gas revenues for these rate classes. This case includes a capital structure composed of 50% common equity and a rate base of $1.2 billion. In July 2015, Ameren Illinois, the ICC staff, and certain other intervenors filed a stipulation and agreement with the ICC that would result in rates that are based on a return on common equity of 9.6%. The agreement does not address the positions of all of the parties in the rate case. Based on the terms in the agreement and the unresolved positions in the case, Ameren Illinois' request seeks an annual revenue increase of $45 million, which is consistent with the ICC staff’s recommendation and the administrative law judges' proposed order issued in November 2015. The administrative law judges' order also proposed the approval of the volume balancing adjustment.

A decision by the ICC in this proceeding is required by December 2015, with new rates expected to be effective in January 2016. Ameren Illinois cannot predict the level of any delivery service rate changes the ICC may approve, whether the ICC will approve the volume balancing adjustment, or if the ICC will approve the agreement between Ameren Illinois, the ICC staff, and certain other intervenors. In addition, Ameren Illinois cannot predict whether any rate changes that may eventually be approved will be sufficient to enable Ameren Illinois to recover its costs and to earn a reasonable return on investments when the rate changes go into effect.

2015 ICC Purchased Power Reconciliation

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

ATXI Transmission Project

The Spoon River project is a MISO-approved 46-mile transmission line to be constructed in northwest Illinois. In September 2015, the ICC granted a certificate of public convenience and necessity and project approval for the Spoon River project.

Federal

Ameren Illinois Electric Transmission Rate Refund

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

In July 2015, the FERC approved a settlement agreement between Ameren Illinois and the affected customers. The settlement agreement required Ameren Illinois to make refunds and payments of $8 million to electric transmission customers, all of which was paid by September 30, 2015. The settlement agreement also requires Ameren Illinois to take other actions, such as reducing common equity for electric transmission ratemaking purposes on a prospective basis.

FERC Complaint Cases

In November 2013, a customer group filed a complaint case with the FERC seeking a reduction in the allowed base return on common equity for the FERC-regulated MISO transmission rate base under the MISO tariff to 9.15%. Currently, the FERC-allowed base return on common equity for MISO transmission owners is 12.38%. The FERC scheduled the case for hearing proceedings, requiring a proposed order from its administrative law judge to be issued no later than November 30, 2015, which will subsequently require FERC approval. The FERC has previously utilized a calculation to establish the allowed base return on common equity, which requires multiple inputs based on observable market data specific to the utility industry and broader macroeconomic data spanning unique time periods for each return on equity complaint case. We expect observable market data for the six months ended February 11, 2015, will be used in the November 2013 complaint case. As the maximum FERC-allowed refund period for the November 2013 complaint case ended in February 2015, another customer complaint case was filed in February 2015. The February 2015 complaint case seeks a reduction in the allowed base return on common equity for the FERC-regulated MISO transmission rate base under the MISO tariff to 8.67%. The FERC scheduled the February 2015 complaint case for hearing proceedings, requiring a proposed order from its administrative law judge to be issued no later than June 30, 2016, which will subsequently require FERC approval. We expect observable market data for the six months ended December 31, 2015, will be used in the February 2015 complaint case.

As of September 30, 2015, Ameren and Ameren Illinois had current regulatory liabilities of $36 million and $25 million, respectively, representing their estimates of the potential refunds from the November 12, 2013 refund effective date. Ameren’s and Ameren Illinois’ recorded liabilities reflect their interpretation of the method and inputs used in the FERC’s calculation to establish the allowed base return on common equity, based on observable market data for the six months ended February 11,

2015, with respect to the November 2013 complaint case refund period, and based on observable market data through September 30, 2015, with respect to the February 2015 complaint case refund period. Ameren’s and Ameren Illinois’ liabilities also reflect the incentive adder discussed below, which became effective in early January 2015. Ameren Missouri did not record a liability as of September 30, 2015, and does not expect that a reduction in the FERC-allowed base return on common equity for MISO transmission owners would be material to its results of operations, financial position, or liquidity. A 50 basis point reduction in the FERC-allowed return on common equity would reduce Ameren's and Ameren Illinois' annual earnings by an estimated $4 million and $2 million, respectively, based on 2015 projected rate base.

On January 6, 2015, a FERC-approved incentive adder of up to 50 basis points on the allowed base return on common equity for our participation in an RTO became effective. Upon the issuance of the final order addressing the initial MISO complaint case, beginning with its January 6, 2015 effective date, the incentive adder will reduce any refund to customers relating to a reduction of the base return on common equity.

Combined Construction and Operating License

In 2008, Ameren Missouri filed an application with the NRC for a COL for a second nuclear unit at Ameren Missouri's existing Callaway County, Missouri, energy center site. In 2009, Ameren Missouri suspended its efforts to build a second nuclear unit at its existing Callaway site, and the NRC suspended review of the COL application. Prior to suspending its efforts, Ameren Missouri had capitalized $69 million related to the project. Due primarily to changes in vendor support for licensing efforts at the NRC, Ameren Missouri’s assessment of long-term capacity needs, declining costs of alternative generation technologies, and the regulatory framework in Missouri, Ameren Missouri discontinued its efforts to license and build a second nuclear unit at its existing Callaway site. As a result of this decision, in the second quarter of 2015, Ameren and Ameren Missouri recognized a $69 million noncash pretax provision for all of the previously capitalized costs of the COL. Ameren Missouri has withdrawn its COL application with the NRC.

NOTE 3 - SHORT-TERM DEBT AND LIQUIDITY

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

The 2012 Missouri Credit Agreement and the 2012 Illinois Credit Agreement, both of which expire on December 11, 2019, were not utilized for direct borrowings during the nine months ended September 30, 2015, but were used to support commercial paper issuances and to issue letters of credit. Based on letters of credit issued under the 2012 Credit Agreements, as well as commercial paper outstanding, the aggregate amount of credit capacity available under the 2012 Credit Agreements to Ameren (parent), Ameren Missouri, and Ameren Illinois, collectively, at September 30, 2015, was $1.3 billion.

Commercial Paper

The following table presents commercial paper outstanding at Ameren (parent), Ameren Missouri, and Ameren Illinois as of September 30, 2015, and December 31, 2014:



	September 30, 2015		December 31, 2014
Ameren (parent)	$	783	$	585
Ameren Missouri	—		97
Ameren Illinois	—		32
Ameren Consolidated	$	783	$	714

The following table summarizes the borrowing activity and relevant interest rates under Ameren’s (parent), Ameren Missouri’s, and Ameren Illinois’ commercial paper programs for the nine months ended September 30, 2015 and 2014:



	Ameren (parent)			Ameren Missouri			Ameren Illinois			Ameren Consolidated
2015
Average daily commercial paper outstanding	$	770		$	56		$	6		$	832
Weighted-average interest rate	0.56		%	0.50		%	0.44		%	0.56		%
Peak commercial paper during period^(a)	$	874		$	294		$	48		$	1,108
Peak interest rate	0.70		%	0.60		%	0.60		%	0.70		%
2014
Average daily commercial paper outstanding	$	386		$	141		$	157		$	609
Weighted-average interest rate	0.36		%	0.38		%	0.31		%	0.35		%
Peak commercial paper during period^(a)	$	531		$	495		$	300		$	907
Peak interest rate	0.75		%	0.70		%	0.34		%	0.75		%


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

Indebtedness Provisions and Other Covenants

The information below is a summary of the Ameren Companies’ compliance with financial covenants in the 2012 Credit Agreements. See Note 4 - Short-term Debt and Liquidity under Part II, Item 8, in the Form 10-K for a detailed description of these provisions. The 2012 Credit Agreements also contain nonfinancial covenants, including restrictions on the ability to incur liens, to transact with affiliates, to dispose of assets, to make investments in or transfer assets to its affiliates, and to merge with other entities.

The 2012 Credit Agreements require each of Ameren, Ameren Missouri, and Ameren Illinois to maintain consolidated indebtedness of not more than 65% of its consolidated total capitalization pursuant to a defined calculation set forth in the agreements. As of September 30, 2015, the ratios of consolidated indebtedness to consolidated total capitalization, calculated in accordance with the 2012 Credit Agreements, were 50%, 48%, and 46%, for Ameren, Ameren Missouri, and Ameren Illinois, respectively. In addition, under the 2012 Illinois Credit Agreement and, by virtue of the cross-default provisions of the 2012 Missouri Credit Agreement, under the 2012 Missouri Credit Agreement, Ameren is required to maintain a ratio of consolidated funds from operations plus interest expense to consolidated interest expense of at least 2.0 to 1.0. However, the interest coverage requirement only applies at such times as Ameren does not have a senior long-term unsecured credit rating of at least Baa3 from Moody’s or BBB- from S&P. As of September 30, 2015, Ameren exceeded the rating requirements; therefore, the interest coverage requirement was not applicable. Failure of a borrower to satisfy a financial covenant constitutes an immediate default under the applicable 2012 Credit Agreement.

The 2012 Credit Agreements contain default provisions that apply separately to each borrower; provided, however, that a default of Ameren Missouri or Ameren Illinois under the applicable 2012 Credit Agreement will also be deemed to constitute a default of Ameren under such agreement. Defaults include a cross-default of such borrower under any other agreement covering outstanding indebtedness of such borrower and certain subsidiaries (other than project finance subsidiaries and nonmaterial subsidiaries) in excess of $75 million in the aggregate (including under the other 2012 Credit Agreement). However, under the default provisions of the 2012 Credit Agreements, any default of Ameren under any 2012 Credit

Agreement that results solely from a default of Ameren Missouri or Ameren Illinois thereunder does not result in a cross-default of Ameren under the other 2012 Credit Agreement. Further, the 2012 Credit Agreement default provisions provide that an Ameren default under any of the 2012 Credit Agreements does not constitute a default by Ameren Missouri or Ameren Illinois.

None of the Ameren Companies' credit agreements or financing arrangements contain credit rating triggers that would cause a default or acceleration of repayment of outstanding balances. The Ameren Companies were in compliance with the covenants in their credit agreements at September 30, 2015.

Money Pools

Ameren has money pool agreements with and among its subsidiaries to coordinate and provide for certain short-term cash and working capital requirements.

Ameren Missouri, Ameren Illinois, and ATXI may participate in the utility money pool as both lenders and borrowers. Ameren and Ameren Services may participate in the utility money pool only as lenders. Surplus internal funds are contributed to the utility money pool from participants. The primary sources of external funds for the utility money pool are the 2012 Credit Agreements and the commercial paper programs. The total amount available to the pool participants from the utility money pool at any given time is reduced by the amount of borrowings made by participants, but is increased to the extent that the pool participants advance surplus funds to the utility money pool or remit funds from other external sources. The availability of funds is also determined by funding requirement limits established by regulatory authorizations. Participants receiving a loan under the utility money pool must repay the principal amount of such loan, together with accrued interest. The rate of interest depends on the composition of internal and external funds in the utility money pool. The average interest rate for borrowing and lending under the utility money pool for the three and nine months ended September 30, 2015, was 0.10% and 0.09%, respectively (2014 - 0.10% and 0.23%, 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, 2015 and 2014.

NOTE 4 - LONG-TERM DEBT AND EQUITY

Ameren Missouri

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

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

Indenture Provisions and Other Covenants

Ameren Missouri’s and Ameren Illinois’ indentures, credit facilities, and articles of incorporation include covenants and provisions related to issuances of first mortgage bonds and preferred stock. Ameren Missouri and Ameren Illinois are required to meet certain ratios to issue additional first mortgage bonds and preferred stock. A failure to achieve these ratios would not result in a default under these covenants and provisions, but would restrict the companies’ ability to issue bonds or preferred stock. The following table summarizes the required and actual interest coverage ratios and dividend coverage ratios, and bonds and preferred stock issuable as of September 30, 2015, at an assumed annual interest rate of 5% and dividend rate of 6%.



	Required Interest Coverage Ratio^(a)	Actual Interest Coverage Ratio		Bonds Issuable^(b)		Required Dividend Coverage Ratio^(c)	Actual Dividend Coverage Ratio		Preferred Stock Issuable
Ameren Missouri	≥2.0	3.7	$	3,338		≥2.5	99.3	$	2,206
Ameren Illinois	≥2.0	7.0		3,659	^(d)	≥1.5	3.0		203	^(e)


(a)	Coverage required on the annual interest charges on first mortgage bonds outstanding and to be issued. Coverage is not required in certain cases when additional first mortgage bonds are issued on the basis of retired bonds.


(b)	Amount of bonds issuable based either on required coverage ratios or unfunded property additions, whichever is more restrictive. The amounts shown also include bonds issuable based on retired bond capacity of $946 million and $204 million at Ameren Missouri and Ameren Illinois, respectively.


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


(d)	Amount of bonds issuable by Ameren Illinois based on unfunded property additions and retired bonds solely under the former IP mortgage indenture. The amount of bonds issuable by Ameren Illinois is also subject to the lien restrictions contained in the 2012 Illinois Credit Agreement.


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

Ameren Missouri and Ameren Illinois and certain other Ameren subsidiaries are subject to Section 305(a) of the Federal Power Act, which makes it unlawful for any officer or director of a public utility, as defined in the Federal Power Act, to participate in the making or paying of any dividend from any funds “properly included in capital account.” The FERC has consistently interpreted the provision to allow dividends to be paid as long as (1) the source of the dividends is clearly disclosed, (2) the dividends are not excessive, and (3) there is no self-dealing on the part of corporate officials. At a minimum, Ameren believes that dividends can be paid by its subsidiaries that are public utilities from retained earnings. In addition, under Illinois law, Ameren Illinois may not pay any dividend on its stock, unless, among other things, its earnings and earned surplus are sufficient to declare and pay a dividend after provision is made for reasonable and proper reserves, or unless Ameren Illinois has specific authorization from the ICC.

Ameren Illinois’ articles of incorporation require dividend payments on its common stock to be based on ratios of common stock to total capitalization and other provisions related to certain

operating expenses and accumulations of earned surplus. Ameren Illinois committed to the FERC to maintain a minimum of 30% equity in its capital structure. As of September 30, 2015, Ameren Illinois had 52% equity in its capital structure.

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

Off-Balance-Sheet Arrangements

At September 30, 2015, none of the Ameren Companies had any off-balance-sheet financing arrangements, other than operating leases entered into in the ordinary course of business. None of the Ameren Companies expect to engage in any significant off-balance-sheet financing arrangements in the near future. See Note 12 - Divestiture Transactions and Discontinued Operations for Ameren (parent) guarantees and letters of credit issued to support New AER based on the transaction agreement with IPH.

NOTE 5 - OTHER INCOME AND EXPENSES

The following table presents the components of “Other Income and Expenses” in the Ameren Companies’ statements of income for the three and nine months ended September 30, 2015 and 2014:



	Three Months				Nine Months
	2015		2014		2015		2014
Ameren:^(a)
Miscellaneous income:
Allowance for equity funds used during construction	$	8	$	10	$	19	$	26
Interest income on industrial development revenue bonds	7