0001002910us-gaap:ElectricityMemberus-gaap:IntersegmentEliminationMemberaee:OtherMember2021-01-012021-06-30ElectricityMemberaee:AmerenIllinoisGasSegmentMemberus-gaap:OperatingSegmentsMember2020-07-012020-09-30
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
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| ☒ | Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended JuneSeptember 30, 2021 |
OR
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| ☐ | Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to |
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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
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| 1-2967 | Union Electric Company | 43-0559760 |
(Missouri Corporation)
1901 Chouteau Avenue
St. Louis, Missouri 63103
(314) 621-3222
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| 1-3672 | Ameren Illinois Company | 37-0211380 |
(Illinois Corporation)
10 Executive Drive
Collinsville, Illinois 62234
(618) 343-8150
Securities Registered Pursuant to Section 12(b) of the Act:
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| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
| Common Stock, $0.01 par value per share | AEE | New York Stock Exchange |
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.
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| Ameren Corporation | | Yes | | ☒ | | No | | ☐ |
| Union Electric Company | | Yes | | ☒ | | No | | ☐ |
| Ameren Illinois Company | | Yes | | ☒ | | No | | ☐ |
Indicate by check mark whether each registrant has submitted electronically every Interactive Data File required to be submitted 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 such files).
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| Ameren Corporation | | Yes | | ☒ | | No | | ☐ |
| Union Electric Company | | Yes | | ☒ | | No | | ☐ |
| Ameren Illinois Company | | Yes | | ☒ | | No | | ☐ |
Indicate by check mark whether each registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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| Ameren Corporation | Large accelerated filer | ☒ | Accelerated filer | ☐ | Non-accelerated filer | ☐ |
| | | Smaller reporting company | ☐ | Emerging growth company | ☐ |
| Union Electric Company | Large accelerated filer | ☐ | Accelerated filer | ☐ | Non-accelerated filer | ☒ |
| | | Smaller reporting company | ☐ | Emerging growth company | ☐ |
| Ameren Illinois Company | Large accelerated filer | ☐ | Accelerated filer | ☐ | Non-accelerated filer | ☒ |
| | | Smaller reporting company | ☐ | Emerging growth company | ☐ |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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| Ameren Corporation | ☐ |
| Union Electric Company | ☐ |
| Ameren Illinois Company | ☐ |
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 | | ☒ |
| Union Electric Company | | Yes | | ☐ | | No | | ☒ |
| Ameren Illinois Company | | Yes | | ☐ | | No | | ☒ |
The number of shares outstanding of each registrant’s classes of common stock as of July 30,October 29, 2021, was as follows:
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| Registrant | | Title of each class of common stock | Shares outstanding |
| Ameren Corporation | | Common stock, $0.01 par value per share | 257,147,162257,606,191 | |
| 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 | |
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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
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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.
ATM program – At-the-market equity distribution program.
CEJA – Climate and Equitable Jobs Act, an Illinois law that, among other things, gives Ameren Illinois the option to establish new electric distribution rates through either a traditional regulatory rate review, which may be based on a future test year, or an MYRP for a four-year period.
Form 10-K – The combined Annual Report on Form 10-K for the year ended December 31, 2020, filed by the Ameren Companies with the SEC.
MIEC – Missouri Industrial Energy Consumers, an association of industrial companies.
MoOPC – Missouri Office of Public Counsel, a state agency.
MYRP – Multi-year rate plan, a four-year electric distribution service rate plan allowed to be filed with the ICC under the CEJA. Under a multi-year rate plan, the ICC would approve base rates for electric distribution service charged to customers for each calendar year of a four-year period. Ameren Illinois would be allowed to reconcile each year's base rates to its actual revenue requirement, subject to a reconciliation cap with exclusions for certain costs and riders, and adjustments to the approved ROE for performance incentives and penalties.
QTD – Three months ended JuneSeptember 30.
YTD – SixNine months ended JuneSeptember 30.
YoY – Compared with the year-ago period.
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, projections, strategies, targets, estimates, 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 within Risk Factors in the Form 10-K and in this report, 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, and any changes in regulatory policies and ratemaking determinations, that may change regulatory recovery mechanisms, such as those that may result from Ameren Missouri’s electric service and natural gas delivery service regulatory rate reviews filed with the MoPSC in March 2021, the July 2020 appeal filed by Ameren Missouri, Ameren Illinois, and ATXI challenging the refund period related to the FERC’s May 2020 order determining the allowed base ROE under the MISO tariff, the July 2020 appeal filed by Ameren Missouri, Ameren Illinois, and ATXI challenging the FERC’s rehearing denials in the transmission formula rate revision cases, Ameren Illinois’ electric distribution service rate reconciliation request filed with the ICC in April 2021, and Ameren Illinois’ annual electric energy-efficiency formula rate update filed with the ICC in May 2021;
•the length and severity of the COVID-19 pandemic, and its impacts on our business continuity plans and our results of operations, financial position, and liquidity, including but not limited to changes in customer demand resulting in changes to sales volumes,volumes; customers’ payment for our services and their use of deferred payment arrangements,arrangements; future regulatory or legislative actions that could require suspension of customer disconnections and/or late fees, among other things, for an extended period of time,time; the health, welfare, and welfareavailability of our workforce and contractors; the impact of federal COVID-19 vaccine mandates on our workforce, our contractors, and our suppliers, including any associated prolonged labor shortages; supplier disruptions,disruptions; delays in the completion of construction projects, which could impact our expected capital expenditures and rate base growth,growth; Ameren Missouri’s ability to recover any forgone customer late fee revenues or incremental costs,costs; our ability to meet customer energy-efficiency program goals and earn performance incentives related to those programs,programs; changes in how we operate our business and increased data security risks as a result of the transition to remote working arrangements for a significant portion of our workforce,workforce; and our ability to access the capital markets on reasonable terms and when needed;
•the effect and duration of Ameren Illinois’ election to opt in touse of the performance-based formula ratemaking framework for its electric distribution service, which unless extended, couldwill establish and allow for a reconciliation of electric distribution service rates through 2023, its participation in electric energy-efficiency programs, and the related impact of the direct relationship between Ameren Illinois’ ROE and the 30-year United States Treasury bond yields,yields;
•the effect and the potential returnduration of Ameren Illinois’ election to either utilize traditional regulatory rate reviews or MYRPs for electric distribution service ratemaking;ratemaking effective for rates beginning in 2024;
•the effect on Ameren Missouri’s investment plan and earnings if an extension to use PISA is not sought by Ameren Missouri or approved by the MoPSC;
•the effect on Ameren Missouri of any customer rate caps pursuant to Ameren Missouri’s election to use the PISA, including an extension of use beyond 2023, if requested by Ameren Missouri and approved by the MoPSC;
•the effects of changes in federal, state, or local laws and other governmental actions, including monetary, fiscal, and energy policies;
•the effects of changes in federal, state, or local tax laws, regulations, interpretations, or rates, and challenges to the tax positions taken by the Ameren Companies, if any, as well as resulting effects on customer rates;
•the effects on energy prices and demand for our services resulting from technological advances, including advances in customer energy efficiency, electric vehicles, electrification of various industries, energy storage, and private 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 revenues and performance incentives earned under its MEEIA programs;
•Ameren Illinois’ ability to achieve the performance standards applicable to its electric distribution business and the FEJA electric customer energy-efficiency goals and the resulting impact on its allowed ROE;
•our ability to control costs and make substantial investments in our businesses, including our ability to recover costs and investments, and to earn our allowed ROEs, within frameworks established by our regulators, while maintaining affordability of our services for our customers;
•the cost and availability of fuel, such as low-sulfur coal, natural gas, and enriched uranium used to produce electricity; the cost and availability of purchased power, zero emission credits, renewable energy credits, emission allowances, and natural gas for distribution; and the level and volatility of future market prices for such commodities and credits;
•disruptions in the delivery of fuel, failure of our fuel suppliers to provide adequate quantities or quality of fuel, or lack of adequate inventories of fuel, including nuclear fuel assemblies from the one NRC-licensed supplier of Ameren Missouri’s Callaway Energy Center assemblies;
•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 effectiveness of our risk management strategies and our use of financial and derivative instruments;
•the ability to obtain sufficient insurance, including insurance for Ameren Missouri’s nuclear and coal-fired energy centers, or in the absence of insurance, the ability to timely recover uninsured losses from our customers;
•the impact of cyberattacks on us or our suppliers, which could, among other things, result in the loss of operational control of energy centers and electric and natural gas transmission and distribution systems and/or the loss of data, such as customer, employee, financial, and operating system information;
•business and economic conditions, which have been affected by, and will be affected by the length and severity of, the COVID-19 pandemic, including the impact of such conditions on interest rates;rates and inflation;
•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 actions of credit rating agencies and the effects of such actions, including any impacts on our credit ratings that may result from the economic conditions of the COVID-19 pandemic;
•the inability of our counterparties to meet their obligations with respect to contracts, credit agreements, and financial instruments, including as it relates to the construction and acquisition of electric and natural gas utility infrastructure and the ability of counterparties to complete projects which is dependent upon the availability of necessary materials and equipment, including those that are affected by disruptions in the global supply chain caused by the COVID-19 pandemic;
•the impact of weather conditions and other natural phenomena on us and our customers, including the impact of system outages and the level of wind and solar resources;
•the construction, installation, performance, and cost recovery of generation, transmission, and distribution assets;
•the effects of failures of electric generation, electric and natural gas transmission or distribution, or natural gas storage facilities systems and equipment, which could result in unanticipated liabilities or unplanned outages;
•the operation of Ameren Missouri’s Callaway Energy Center, including planned and unplanned outages, as well as the ability to recover costs associated with such outages and the impact of such outages on off-system sales and purchased power, among other things;
•Ameren Missouri’s ability to recover the remaining investment and decommissioning costs associated with the retirement of an energy center, as well as the ability to earn a return on that remaining investment and those decommissioning costs;
•the impact of current environmental laws and new, more stringent, or changing requirements, including those related to NSR and CO2, other emissions and discharges, cooling water intake structures, CCR, energy efficiency, and wildlife protection, that could limit or terminate the operation of certain of Ameren Missouri’s energy centers, increase our operating 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 a final judgment to be issued by the United States Court for the Eastern District of Missouri regarding its September 2019 remedy order that could require Ameren Missouri to install a flue gas desulfurization system, which would increase capital expenditures and annual operating costs, or could limit the useful life of Ameren Missouri’s Rush Island Energy Center;
•the impact of complying with renewable energy standards in Missouri and Illinois and with the zero emission standard in Illinois;
•Ameren Missouri’s ability to construct and/or acquire wind, solar, and other renewable energy generation facilities, retire energy centers, and implement new or existing customer energy-efficiency programs, including any such construction, acquisition, retirement, or implementation in connection with its Smart Energy Plan, the 2020 IRP, or our emissions reduction goals, and to recover its cost of investment, related return, and, in the case of customer energy-efficiency programs, any lost margins in a timely manner, which is affected by the ability to obtain all necessary regulatory and project approvals, including certificates of convenience and necessity from the MoPSC or any other required approvals for the addition of renewable resources;
•the availability of federal production and investment tax credits related to renewable energy and Ameren Missouri’s ability to use such credits; the cost of wind, solar, and other renewable generation and storage technologies; and our ability to obtain timely interconnection agreements with the MISO or other RTOs at an acceptable cost for each facility;
•advancements in carbon-free generation and storage technologies, and the impact of constructive federal and state energy and economic policies with respect to those technologies;
•labor disputes, work force reductions, changes in future wage and employee benefits costs, including those resulting from changes in discount rates, mortality tables, returns on benefit plan assets, and other assumptions;
•the impact of negative opinions of us or our utility services that our customers, investors, legislators, or regulators may have or develop, which could result from a variety of factors, including failures in system reliability, failure to implement our investment plans or to protect sensitive customer information, increases in rates, negative media coverage, or concerns about environmental, social, and/or governance practices;
•the impact of adopting new accounting guidance;
•the effects of strategic initiatives, including mergers, acquisitions, and divestitures;
•legal and administrative proceedings; and
•acts of sabotage, war, terrorism, 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 AND COMPREHENSIVE INCOME
(Unaudited) (In millions, except per share amounts)
| | | | Three Months Ended June 30, | | Six Months Ended June 30, | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Operating Revenues: | Operating Revenues: | | | | | | | | Operating Revenues: | | | | | | | |
| Electric | Electric | $ | 1,284 | | | $ | 1,237 | | | $ | 2,440 | | | $ | 2,357 | | Electric | $ | 1,668 | | | $ | 1,489 | | | $ | 4,108 | | | $ | 3,846 | |
| Natural gas | Natural gas | 188 | | | 161 | | | 598 | | | 481 | | Natural gas | 143 | | | 139 | | | 741 | | | 620 | |
| Total operating revenues | Total operating revenues | 1,472 | | | 1,398 | | | 3,038 | | | 2,838 | | Total operating revenues | 1,811 | | | 1,628 | | | 4,849 | | | 4,466 | |
| Operating Expenses: | Operating Expenses: | | | | | | | | Operating Expenses: | | | | | | | |
| Fuel | Fuel | 173 | | | 119 | | | 238 | | | 259 | | Fuel | 184 | | | 141 | | | 422 | | | 400 | |
| Purchased power | Purchased power | 129 | | | 109 | | | 320 | | | 243 | | Purchased power | 159 | | | 140 | | | 479 | | | 383 | |
| Natural gas purchased for resale | Natural gas purchased for resale | 65 | | | 42 | | | 230 | | | 149 | | Natural gas purchased for resale | 45 | | | 34 | | | 275 | | | 183 | |
| Other operations and maintenance | Other operations and maintenance | 412 | | | 384 | | | 832 | | | 822 | | Other operations and maintenance | 457 | | | 418 | | | 1,289 | | | 1,240 | |
| | Depreciation and amortization | Depreciation and amortization | 285 | | | 271 | | | 566 | | | 526 | | Depreciation and amortization | 290 | | | 273 | | | 856 | | | 799 | |
| Taxes other than income taxes | Taxes other than income taxes | 122 | | | 119 | | | 250 | | | 244 | | Taxes other than income taxes | 142 | | | 128 | | | 392 | | | 372 | |
| Total operating expenses | Total operating expenses | 1,186 | | | 1,044 | | | 2,436 | | | 2,243 | | Total operating expenses | 1,277 | | | 1,134 | | | 3,713 | | | 3,377 | |
| Operating Income | Operating Income | 286 | | | 354 | | | 602 | | | 595 | | Operating Income | 534 | | | 494 | | | 1,136 | | | 1,089 | |
| | Other Income, Net | Other Income, Net | 49 | | | 48 | | | 95 | | | 69 | | Other Income, Net | 56 | | | 48 | | | 151 | | | 117 | |
| Interest Charges | Interest Charges | 96 | | | 108 | | | 196 | | | 201 | | Interest Charges | 94 | | | 110 | | | 290 | | | 311 | |
| Income Before Income Taxes | Income Before Income Taxes | 239 | | | 294 | | | 501 | | | 463 | | Income Before Income Taxes | 496 | | | 432 | | | 997 | | | 895 | |
| Income Taxes | Income Taxes | 31 | | | 50 | | | 58 | | | 71 | | Income Taxes | 70 | | | 63 | | | 128 | | | 134 | |
| | Net Income | Net Income | 208 | | | 244 | | | 443 | | | 392 | | Net Income | 426 | | | 369 | | | 869 | | | 761 | |
| Less: Net Income Attributable to Noncontrolling Interests | Less: Net Income Attributable to Noncontrolling Interests | 1 | | | 1 | | | 3 | | | 3 | | Less: Net Income Attributable to Noncontrolling Interests | 1 | | | 2 | | | 4 | | | 5 | |
| | Net Income Attributable to Ameren Common Shareholders | Net Income Attributable to Ameren Common Shareholders | $ | 207 | | | $ | 243 | | | $ | 440 | | | $ | 389 | | Net Income Attributable to Ameren Common Shareholders | $ | 425 | | | $ | 367 | | | $ | 865 | | | $ | 756 | |
| | | Net Income | Net Income | $ | 208 | | | $ | 244 | | | $ | 443 | | | $ | 392 | | Net Income | $ | 426 | | | $ | 369 | | | $ | 869 | | | $ | 761 | |
| Other Comprehensive Income (Loss), Net of Taxes | | |
| Pension and other postretirement benefit plan activity, net of income taxes of $0, $0, $0, and $0, respectively | (1) | | | 0 | | | 0 | | | 1 | | |
| Other Comprehensive Income, Net of Taxes | | Other Comprehensive Income, Net of Taxes | |
| Pension and other postretirement benefit plan activity, net of income taxes of $—, $—, $—, and $—, respectively | | Pension and other postretirement benefit plan activity, net of income taxes of $—, $—, $—, and $—, respectively | 1 | | | 1 | | | 1 | | | 2 | |
| Comprehensive Income | Comprehensive Income | 207 | | | 244 | | | 443 | | | 393 | | Comprehensive Income | 427 | | | 370 | | | 870 | | | 763 | |
| Less: Comprehensive Income Attributable to Noncontrolling Interests | Less: Comprehensive Income Attributable to Noncontrolling Interests | 1 | | | 1 | | | 3 | | | 3 | | Less: Comprehensive Income Attributable to Noncontrolling Interests | 1 | | | 2 | | | 4 | | | 5 | |
| Comprehensive Income Attributable to Ameren Common Shareholders | Comprehensive Income Attributable to Ameren Common Shareholders | $ | 206 | | | $ | 243 | | | $ | 440 | | | $ | 390 | | Comprehensive Income Attributable to Ameren Common Shareholders | $ | 426 | | | $ | 368 | | | $ | 866 | | | $ | 758 | |
| | | | Earnings per Common Share – Basic | Earnings per Common Share – Basic | $ | 0.81 | | | $ | 0.99 | | | $ | 1.72 | | | $ | 1.58 | | Earnings per Common Share – Basic | $ | 1.66 | | | $ | 1.48 | | | $ | 3.38 | | | $ | 3.06 | |
| | | Earnings per Common Share – Diluted | Earnings per Common Share – Diluted | $ | 0.80 | | | $ | 0.98 | | | $ | 1.71 | | | $ | 1.57 | | Earnings per Common Share – Diluted | $ | 1.65 | | | $ | 1.47 | | | $ | 3.36 | | | $ | 3.04 | |
| | Weighted-average Common Shares Outstanding – Basic | Weighted-average Common Shares Outstanding – Basic | 256.1 | | | 246.9 | | | 255.2 | | | 246.7 | | Weighted-average Common Shares Outstanding – Basic | 257.3 | | | 247.1 | | | 255.9 | | | 246.8 | |
| Weighted-average Common Shares Outstanding – Diluted | Weighted-average Common Shares Outstanding – Diluted | 257.2 | | | 247.9 | | | 256.5 | | | 248.0 | | Weighted-average Common Shares Outstanding – Diluted | 258.6 | | | 249.2 | | | 257.2 | | | 248.4 | |
The accompanying notes are an integral part of these consolidated financial statements.
AMEREN CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)
| | | June 30, 2021 | | December 31, 2020 | | September 30, 2021 | | December 31, 2020 |
| ASSETS | ASSETS | | | | ASSETS | | | |
| Current Assets: | Current Assets: | | Current Assets: | |
| Cash and cash equivalents | Cash and cash equivalents | $ | 99 | | | $ | 139 | | Cash and cash equivalents | $ | 7 | | | $ | 139 | |
| Accounts receivable – trade (less allowance for doubtful accounts of $42 and $50, respectively) | 397 | | | 415 | | |
| Accounts receivable – trade (less allowance for doubtful accounts of $36 and $50, respectively) | | Accounts receivable – trade (less allowance for doubtful accounts of $36 and $50, respectively) | 515 | | | 415 | |
| Unbilled revenue | Unbilled revenue | 339 | | | 269 | | Unbilled revenue | 332 | | | 269 | |
| Miscellaneous accounts receivable | Miscellaneous accounts receivable | 105 | | | 65 | | Miscellaneous accounts receivable | 111 | | | 65 | |
| Inventories | Inventories | 527 | | | 521 | | Inventories | 595 | | | 521 | |
| | Restricted cash | 131 | | | 17 | | |
| | Current regulatory assets | Current regulatory assets | 353 | | | 109 | | Current regulatory assets | 359 | | | 109 | |
| | Other current assets | Other current assets | 165 | | | 118 | | Other current assets | 285 | | | 135 | |
| | Total current assets | Total current assets | 2,116 | | | 1,653 | | Total current assets | 2,204 | | | 1,653 | |
| Property, Plant, and Equipment, Net | Property, Plant, and Equipment, Net | 28,020 | | | 26,807 | | Property, Plant, and Equipment, Net | 28,559 | | | 26,807 | |
| Investments and Other Assets: | Investments and Other Assets: | | Investments and Other Assets: | |
| Nuclear decommissioning trust fund | Nuclear decommissioning trust fund | 1,070 | | | 982 | | Nuclear decommissioning trust fund | 1,076 | | | 982 | |
| Goodwill | Goodwill | 411 | | | 411 | | Goodwill | 411 | | | 411 | |
| | Regulatory assets | Regulatory assets | 1,272 | | | 1,100 | | Regulatory assets | 1,235 | | | 1,100 | |
| Other assets | Other assets | 1,027 | | | 1,077 | | Other assets | 1,180 | | | 1,077 | |
| | Total investments and other assets | Total investments and other assets | 3,780 | | | 3,570 | | Total investments and other assets | 3,902 | | | 3,570 | |
| TOTAL ASSETS | TOTAL ASSETS | $ | 33,916 | | | $ | 32,030 | | TOTAL ASSETS | $ | 34,665 | | | $ | 32,030 | |
| LIABILITIES AND EQUITY | LIABILITIES AND EQUITY | | | | LIABILITIES AND EQUITY | | | |
| Current Liabilities: | Current Liabilities: | | Current Liabilities: | |
| Current maturities of long-term debt | Current maturities of long-term debt | $ | 8 | | | $ | 8 | | Current maturities of long-term debt | $ | 57 | | | $ | 8 | |
| Short-term debt | Short-term debt | 431 | | | 490 | | Short-term debt | 553 | | | 490 | |
| Accounts and wages payable | Accounts and wages payable | 779 | | | 958 | | Accounts and wages payable | 811 | | | 958 | |
| Taxes accrued | Taxes accrued | 178 | | | 82 | | Taxes accrued | 231 | | | 82 | |
| Interest accrued | Interest accrued | 129 | | | 114 | | Interest accrued | 103 | | | 114 | |
| | Current regulatory liabilities | Current regulatory liabilities | 238 | | | 121 | | Current regulatory liabilities | 138 | | | 121 | |
| | Other current liabilities | Other current liabilities | 414 | | | 407 | | Other current liabilities | 464 | | | 407 | |
| | Total current liabilities | Total current liabilities | 2,177 | | | 2,180 | | Total current liabilities | 2,357 | | | 2,180 | |
| Long-term Debt, Net | Long-term Debt, Net | 12,492 | | | 11,078 | | Long-term Debt, Net | 12,444 | | | 11,078 | |
| Deferred Credits and Other Liabilities: | Deferred Credits and Other Liabilities: | | Deferred Credits and Other Liabilities: | |
| Accumulated deferred income taxes and tax credits, net | Accumulated deferred income taxes and tax credits, net | 3,309 | | | 3,211 | | Accumulated deferred income taxes and tax credits, net | 3,465 | | | 3,211 | |
| | Regulatory liabilities | Regulatory liabilities | 5,258 | | | 5,282 | | Regulatory liabilities | 5,425 | | | 5,282 | |
| Asset retirement obligations | Asset retirement obligations | 712 | | | 696 | | Asset retirement obligations | 705 | | | 696 | |
| Pension and other postretirement benefits | Pension and other postretirement benefits | 39 | | | 37 | | Pension and other postretirement benefits | 39 | | | 37 | |
| Other deferred credits and liabilities | Other deferred credits and liabilities | 447 | | | 466 | | Other deferred credits and liabilities | 416 | | | 466 | |
| | Total deferred credits and other liabilities | Total deferred credits and other liabilities | 9,765 | | | 9,692 | | Total deferred credits and other liabilities | 10,050 | | | 9,692 | |
| Commitments and Contingencies (Notes 2, 9, and 10) | Commitments and Contingencies (Notes 2, 9, and 10) | 0 | | | Commitments and Contingencies (Notes 2, 9, and 10) | 0 | | 0 |
| Ameren Corporation Shareholders’ Equity: | | |
| Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 257.1 and 253.3, respectively | 3 | | | 3 | | |
| Shareholders’ Equity: | | Shareholders’ Equity: | |
| Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 257.6 and 253.3, respectively | | Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 257.6 and 253.3, respectively | 3 | | | 3 | |
| Other paid-in capital, principally premium on common stock | Other paid-in capital, principally premium on common stock | 6,436 | | | 6,179 | | Other paid-in capital, principally premium on common stock | 6,483 | | | 6,179 | |
| Retained earnings | Retained earnings | 2,915 | | | 2,757 | | Retained earnings | 3,199 | | | 2,757 | |
| Accumulated other comprehensive loss | Accumulated other comprehensive loss | (1) | | | (1) | | Accumulated other comprehensive loss | — | | | (1) | |
| | Total Ameren Corporation shareholders’ equity | 9,353 | | | 8,938 | | |
| Total shareholders’ equity | | Total shareholders’ equity | 9,685 | | | 8,938 | |
| Noncontrolling Interests | Noncontrolling Interests | 129 | | | 142 | | Noncontrolling Interests | 129 | | | 142 | |
| Total equity | Total equity | 9,482 | | | 9,080 | | Total equity | 9,814 | | | 9,080 | |
| TOTAL LIABILITIES AND EQUITY | TOTAL LIABILITIES AND EQUITY | $ | 33,916 | | | $ | 32,030 | | TOTAL LIABILITIES AND EQUITY | $ | 34,665 | | | $ | 32,030 | |
The accompanying notes are an integral part of these consolidated financial statements.
| | AMEREN CORPORATION | AMEREN CORPORATION | AMEREN CORPORATION |
| CONSOLIDATED STATEMENT OF CASH FLOWS | CONSOLIDATED STATEMENT OF CASH FLOWS | CONSOLIDATED STATEMENT OF CASH FLOWS |
| (Unaudited) (In millions) | (Unaudited) (In millions) | (Unaudited) (In millions) |
| | | Six Months Ended June 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 |
| Cash Flows From Operating Activities: | Cash Flows From Operating Activities: | | | | Cash Flows From Operating Activities: | | | |
| Net income | Net income | $ | 443 | | | $ | 392 | | Net income | $ | 869 | | | $ | 761 | |
| | Adjustments to reconcile net income to net cash provided by operating activities: | Adjustments to reconcile net income to net cash provided by operating activities: | | Adjustments to reconcile net income to net cash provided by operating activities: | |
| | Depreciation and amortization | Depreciation and amortization | 596 | | | 532 | | Depreciation and amortization | 903 | | | 802 | |
| Amortization of nuclear fuel | Amortization of nuclear fuel | 20 | | | 45 | | Amortization of nuclear fuel | 37 | | | 68 | |
| Amortization of debt issuance costs and premium/discounts | Amortization of debt issuance costs and premium/discounts | 11 | | | 11 | | Amortization of debt issuance costs and premium/discounts | 17 | | | 16 | |
| Deferred income taxes and investment tax credits, net | Deferred income taxes and investment tax credits, net | 59 | | | 68 | | Deferred income taxes and investment tax credits, net | 139 | | | 125 | |
| Allowance for equity funds used during construction | Allowance for equity funds used during construction | (16) | | | (13) | | Allowance for equity funds used during construction | (30) | | | (25) | |
| Stock-based compensation costs | Stock-based compensation costs | 11 | | | 11 | | Stock-based compensation costs | 17 | | | 16 | |
| Other | Other | 2 | | | 5 | | Other | 11 | | | 14 | |
| Changes in assets and liabilities: | Changes in assets and liabilities: | | Changes in assets and liabilities: | |
| Receivables | Receivables | (92) | | | (161) | | Receivables | (212) | | | (113) | |
| Inventories | Inventories | (5) | | | (19) | | Inventories | (73) | | | (61) | |
| Accounts and wages payable | Accounts and wages payable | (208) | | | (193) | | Accounts and wages payable | (143) | | | (190) | |
| Taxes accrued | Taxes accrued | 104 | | | 108 | | Taxes accrued | 148 | | | 154 | |
| Regulatory assets and liabilities | Regulatory assets and liabilities | (441) | | | (87) | | Regulatory assets and liabilities | (340) | | | (55) | |
| Assets, other | Assets, other | (66) | | | (9) | | Assets, other | (118) | | | (66) | |
| Liabilities, other | Liabilities, other | 17 | | | 9 | | Liabilities, other | (27) | | | (76) | |
| Pension and other postretirement benefits | Pension and other postretirement benefits | 1 | | | (5) | | Pension and other postretirement benefits | (6) | | | (41) | |
| | Net cash provided by operating activities | Net cash provided by operating activities | 436 | | | 694 | | Net cash provided by operating activities | 1,192 | | | 1,329 | |
| Cash Flows From Investing Activities: | Cash Flows From Investing Activities: | | | | Cash Flows From Investing Activities: | | | |
| Capital expenditures | Capital expenditures | (1,346) | | | (1,228) | | Capital expenditures | (2,098) | | | (1,884) | |
| Wind generation expenditures | Wind generation expenditures | (417) | | | 0 | | Wind generation expenditures | (515) | | | — | |
| Nuclear fuel expenditures | Nuclear fuel expenditures | (4) | | | (56) | | Nuclear fuel expenditures | (19) | | | (61) | |
| Purchases of securities – nuclear decommissioning trust fund | Purchases of securities – nuclear decommissioning trust fund | (203) | | | (153) | | Purchases of securities – nuclear decommissioning trust fund | (411) | | | (169) | |
| Sales and maturities of securities – nuclear decommissioning trust fund | Sales and maturities of securities – nuclear decommissioning trust fund | 208 | | | 121 | | Sales and maturities of securities – nuclear decommissioning trust fund | 404 | | | 135 | |
| | Other | Other | 2 | | | 1 | | Other | (7) | | | (2) | |
| | Net cash used in investing activities | Net cash used in investing activities | (1,760) | | | (1,315) | | Net cash used in investing activities | (2,646) | | | (1,981) | |
| Cash Flows From Financing Activities: | Cash Flows From Financing Activities: | | | | Cash Flows From Financing Activities: | | | |
| Dividends on common stock | Dividends on common stock | (282) | | | (244) | | Dividends on common stock | (423) | | | (367) | |
| Dividends paid to noncontrolling interest holders | Dividends paid to noncontrolling interest holders | (3) | | | (3) | | Dividends paid to noncontrolling interest holders | (4) | | | (5) | |
| Short-term debt, net | Short-term debt, net | (59) | | | (320) | | Short-term debt, net | 63 | | | (168) | |
| Maturities of long-term debt | Maturities of long-term debt | 0 | | | (85) | | Maturities of long-term debt | — | | | (85) | |
| | Issuances of long-term debt | Issuances of long-term debt | 1,423 | | | 1,263 | | Issuances of long-term debt | 1,423 | | | 1,263 | |
| Issuances of common stock | Issuances of common stock | 258 | | | 27 | | Issuances of common stock | 297 | | | 37 | |
| | Redemptions of Ameren Illinois preferred stock | Redemptions of Ameren Illinois preferred stock | (13) | | | 0 | | Redemptions of Ameren Illinois preferred stock | (13) | | | — | |
| Employee payroll taxes related to stock-based compensation | Employee payroll taxes related to stock-based compensation | (17) | | | (20) | | Employee payroll taxes related to stock-based compensation | (17) | | | (20) | |
| Debt issuance costs | Debt issuance costs | (13) | | | (10) | | Debt issuance costs | (15) | | | (11) | |
| Other | Other | (4) | | | 0 | | Other | (13) | | | — | |
| | Net cash provided by financing activities | Net cash provided by financing activities | 1,290 | | | 608 | | Net cash provided by financing activities | 1,298 | | | 644 | |
| Net change in cash, cash equivalents, and restricted cash | Net change in cash, cash equivalents, and restricted cash | (34) | | | (13) | | Net change in cash, cash equivalents, and restricted cash | (156) | | | (8) | |
| Cash, cash equivalents, and restricted cash at beginning of year | Cash, cash equivalents, and restricted cash at beginning of year | 301 | | | 176 | | Cash, cash equivalents, and restricted cash at beginning of year | 301 | | | 176 | |
| | Cash, cash equivalents, and restricted cash at end of period | Cash, cash equivalents, and restricted cash at end of period | $ | 267 | | | $ | 163 | | Cash, cash equivalents, and restricted cash at end of period | $ | 145 | | | $ | 168 | |
|
The accompanying notes are an integral part of these consolidated financial statements.
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY
(Unaudited) (In millions, except per share amounts)
| | | | Three Months Ended June 30, | | Six Months Ended June 30, | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| | Common Stock | Common Stock | $ | 3 | | | $ | 2 | | | $ | 3 | | | $ | 2 | | Common Stock | $ | 3 | | | $ | 2 | | | $ | 3 | | | $ | 2 | |
| | | Other Paid-in Capital: | Other Paid-in Capital: | | Other Paid-in Capital: | |
| Beginning of period | Beginning of period | 6,295 | | | 5,695 | | | 6,179 | | | 5,694 | | Beginning of period | 6,436 | | | 5,716 | | | 6,179 | | | 5,694 | |
| Settlement of forward sale agreement through common shares issuance | Settlement of forward sale agreement through common shares issuance | 0 | | | 0 | | | 113 | | | 0 | | Settlement of forward sale agreement through common shares issuance | — | | | — | | | 113 | | | — | |
| Shares issued under the ATM program | Shares issued under the ATM program | 121 | | | 0 | | | 121 | | | 0 | | Shares issued under the ATM program | 27 | | | — | | | 148 | | | — | |
| Shares issued under the DRPlus and 401(k) plan | Shares issued under the DRPlus and 401(k) plan | 12 | | | 14 | | | 24 | | | 27 | | Shares issued under the DRPlus and 401(k) plan | 12 | | | 10 | | | 36 | | | 37 | |
| Stock-based compensation activity | Stock-based compensation activity | 8 | | | 7 | | | (1) | | | (5) | | Stock-based compensation activity | 8 | | | 7 | | | 7 | | | 2 | |
| | Other paid-in capital, end of period | Other paid-in capital, end of period | 6,436 | | | 5,716 | | | 6,436 | | | 5,716 | | Other paid-in capital, end of period | 6,483 | | | 5,733 | | | 6,483 | | | 5,733 | |
| | Retained Earnings: | Retained Earnings: | | Retained Earnings: | |
| Beginning of period | Beginning of period | 2,850 | | | 2,404 | | | 2,757 | | | 2,380 | | Beginning of period | 2,915 | | | 2,525 | | | 2,757 | | | 2,380 | |
| Net income attributable to Ameren common shareholders | Net income attributable to Ameren common shareholders | 207 | | | 243 | | | 440 | | | 389 | | Net income attributable to Ameren common shareholders | 425 | | | 367 | | | 865 | | | 756 | |
| Dividends on common stock | Dividends on common stock | (142) | | | (122) | | | (282) | | | (244) | | Dividends on common stock | (141) | | | (123) | | | (423) | | | (367) | |
| | Retained earnings, end of period | Retained earnings, end of period | 2,915 | | | 2,525 | | | 2,915 | | | 2,525 | | Retained earnings, end of period | 3,199 | | | 2,769 | | | 3,199 | | | 2,769 | |
| | Accumulated Other Comprehensive Loss: | Accumulated Other Comprehensive Loss: | | Accumulated Other Comprehensive Loss: | |
| | Deferred retirement benefit costs, beginning of period | Deferred retirement benefit costs, beginning of period | 0 | | | (16) | | | (1) | | | (17) | | Deferred retirement benefit costs, beginning of period | (1) | | | (16) | | | (1) | | | (17) | |
| | Change in deferred retirement benefit costs | Change in deferred retirement benefit costs | (1) | | | 0 | | | 0 | | | 1 | | Change in deferred retirement benefit costs | 1 | | | 1 | | | 1 | | | 2 | |
| | Deferred retirement benefit costs, end of period | Deferred retirement benefit costs, end of period | (1) | | | (16) | | | (1) | | | (16) | | Deferred retirement benefit costs, end of period | — | | | (15) | | | — | | | (15) | |
| Total accumulated other comprehensive loss, end of period | Total accumulated other comprehensive loss, end of period | (1) | | | (16) | | | (1) | | | (16) | | Total accumulated other comprehensive loss, end of period | — | | | (15) | | | — | | | (15) | |
| Total Ameren Corporation Shareholders’ Equity | $ | 9,353 | | | $ | 8,227 | | | $ | 9,353 | | | $ | 8,227 | | |
| Total Shareholders’ Equity | | Total Shareholders’ Equity | $ | 9,685 | | | $ | 8,489 | | | $ | 9,685 | | | $ | 8,489 | |
| | Noncontrolling Interests: | Noncontrolling Interests: | | Noncontrolling Interests: | |
| Beginning of period | Beginning of period | 129 | | | 142 | | | 142 | | | 142 | | Beginning of period | 129 | | | 142 | | | 142 | | | 142 | |
| Net income attributable to noncontrolling interest holders | Net income attributable to noncontrolling interest holders | 1 | | | 1 | | | 3 | | | 3 | | Net income attributable to noncontrolling interest holders | 1 | | | 2 | | | 4 | | | 5 | |
| Dividends paid to noncontrolling interest holders | Dividends paid to noncontrolling interest holders | (1) | | | (1) | | | (3) | | | (3) | | Dividends paid to noncontrolling interest holders | (1) | | | (2) | | | (4) | | | (5) | |
| Redemptions of Ameren Illinois preferred stock | Redemptions of Ameren Illinois preferred stock | 0 | | | 0 | | | (13) | | | 0 | | Redemptions of Ameren Illinois preferred stock | — | | | — | | | (13) | | | — | |
| | Noncontrolling interests, end of period | Noncontrolling interests, end of period | 129 | | | 142 | | | 129 | | | 142 | | Noncontrolling interests, end of period | 129 | | | 142 | | | 129 | | | 142 | |
| Total Equity | Total Equity | $ | 9,482 | | | $ | 8,369 | | | $ | 9,482 | | | $ | 8,369 | | Total Equity | $ | 9,814 | | | $ | 8,631 | | | $ | 9,814 | | | $ | 8,631 | |
| | | Common stock shares outstanding at beginning of period | Common stock shares outstanding at beginning of period | 255.5 | | | 246.9 | | | 253.3 | | | 246.2 | | Common stock shares outstanding at beginning of period | 257.1 | | | 247.1 | | | 253.3 | | | 246.2 | |
| Shares issued under forward sale agreement | Shares issued under forward sale agreement | 0 | | | 0 | | | 1.6 | | | 0 | | Shares issued under forward sale agreement | — | | | — | | | 1.6 | | | — | |
| Shares issued under the ATM program | Shares issued under the ATM program | 1.4 | | | 0 | | | 1.4 | | | 0 | | Shares issued under the ATM program | 0.4 | | | — | | | 1.8 | | | — | |
| Shares issued under the DRPlus and 401(k) plan | Shares issued under the DRPlus and 401(k) plan | 0.2 | | | 0.2 | | | 0.3 | | | 0.4 | | Shares issued under the DRPlus and 401(k) plan | 0.1 | | | 0.1 | | | 0.4 | | | 0.5 | |
| Shares issued for stock-based compensation | Shares issued for stock-based compensation | 0 | | | 0 | | | 0.5 | | | 0.5 | | Shares issued for stock-based compensation | — | | | — | | | 0.5 | | | 0.5 | |
| Common stock shares outstanding at end of period | Common stock shares outstanding at end of period | 257.1 | | | 247.1 | | | 257.1 | | | 247.1 | | Common stock shares outstanding at end of period | 257.6 | | | 247.2 | | | 257.6 | | | 247.2 | |
| | Dividends per common share | Dividends per common share | $ | 0.550 | | | $ | 0.495 | | | $ | 1.100 | | | $ | 0.990 | | Dividends per common share | $ | 0.550 | | | $ | 0.495 | | | $ | 1.650 | | | $ | 1.485 | |
The accompanying notes are an integral part of these consolidated financial statements.
UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)
STATEMENT OF INCOME
(Unaudited) (In millions)
| | | | Three Months Ended June 30, | | Six Months Ended June 30, | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Operating Revenues: | Operating Revenues: | | | | | | | | Operating Revenues: | | | | | | | |
| Electric | Electric | $ | 789 | | | $ | 771 | | | $ | 1,430 | | | $ | 1,402 | | Electric | $ | 1,113 | | | $ | 984 | | | $ | 2,543 | | | $ | 2,386 | |
| Natural gas | Natural gas | 20 | | | 21 | | | 83 | | | 70 | | Natural gas | 16 | | | 17 | | | 99 | | | 87 | |
| | Total operating revenues | Total operating revenues | 809 | | | 792 | | | 1,513 | | | 1,472 | | Total operating revenues | 1,129 | | | 1,001 | | | 2,642 | | | 2,473 | |
| Operating Expenses: | Operating Expenses: | | | | | | | | Operating Expenses: | | | | | | | |
| Fuel | Fuel | 173 | | | 119 | | | 238 | | | 259 | | Fuel | 184 | | | 141 | | | 422 | | | 400 | |
| Purchased power | Purchased power | 50 | | | 37 | | | 138 | | | 76 | | Purchased power | 57 | | | 48 | | | 195 | | | 124 | |
| Natural gas purchased for resale | Natural gas purchased for resale | 5 | | | 6 | | | 36 | | | 24 | | Natural gas purchased for resale | 4 | | | 5 | | | 40 | | | 29 | |
| Other operations and maintenance | Other operations and maintenance | 218 | | | 202 | | | 443 | | | 441 | | Other operations and maintenance | 240 | | | 221 | | | 683 | | | 662 | |
| | Depreciation and amortization | Depreciation and amortization | 157 | | | 155 | | | 313 | | | 294 | | Depreciation and amortization | 161 | | | 154 | | | 474 | | | 448 | |
| Taxes other than income taxes | Taxes other than income taxes | 85 | | | 83 | | | 162 | | | 162 | | Taxes other than income taxes | 104 | | | 92 | | | 266 | | | 254 | |
| Total operating expenses | Total operating expenses | 688 | | | 602 | | | 1,330 | | | 1,256 | | Total operating expenses | 750 | | | 661 | | | 2,080 | | | 1,917 | |
| Operating Income | Operating Income | 121 | | | 190 | | | 183 | | | 216 | | Operating Income | 379 | | | 340 | | | 562 | | | 556 | |
| | Other Income, Net | Other Income, Net | 24 | | | 25 | | | 47 | | | 29 | | Other Income, Net | 27 | | | 26 | | | 74 | | | 55 | |
| Interest Charges | Interest Charges | 36 | | | 50 | | | 75 | | | 90 | | Interest Charges | 32 | | | 50 | | | 107 | | | 140 | |
| Income Before Income Taxes | Income Before Income Taxes | 109 | | | 165 | | | 155 | | | 155 | | Income Before Income Taxes | 374 | | | 316 | | | 529 | | | 471 | |
| Income Taxes (Benefit) | Income Taxes (Benefit) | (3) | | | 12 | | | (5) | | | 11 | | Income Taxes (Benefit) | (2) | | | 18 | | | (7) | | | 29 | |
| Net Income | Net Income | 112 | | | 153 | | | 160 | | | 144 | | Net Income | 376 | | | 298 | | | 536 | | | 442 | |
| | Preferred Stock Dividends | Preferred Stock Dividends | 1 | | | 1 | | | 2 | | | 2 | | Preferred Stock Dividends | 1 | | | 1 | | | 3 | | | 3 | |
| Net Income Available to Common Shareholder | Net Income Available to Common Shareholder | $ | 111 | | | $ | 152 | | | $ | 158 | | | $ | 142 | | Net Income Available to Common Shareholder | $ | 375 | | | $ | 297 | | | $ | 533 | | | $ | 439 | |
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)
| | | June 30, 2021 | | December 31, 2020 | | September 30, 2021 | | December 31, 2020 |
| ASSETS | ASSETS | | | | ASSETS | | | |
| Current Assets: | Current Assets: | | Current Assets: | |
| Cash and cash equivalents | Cash and cash equivalents | $ | 0 | | | $ | 136 | | Cash and cash equivalents | $ | — | | | $ | 136 | |
| Advances to money pool | Advances to money pool | 92 | | | 139 | | Advances to money pool | 24 | | | 139 | |
| Accounts receivable – trade (less allowance for doubtful accounts of $16 and $16, respectively) | 168 | | | 166 | | |
| Accounts receivable – trade (less allowance for doubtful accounts of $14 and $16, respectively) | | Accounts receivable – trade (less allowance for doubtful accounts of $14 and $16, respectively) | 266 | | | 166 | |
| Accounts receivable – affiliates | Accounts receivable – affiliates | 49 | | | 57 | | Accounts receivable – affiliates | 51 | | | 57 | |
| Unbilled revenue | Unbilled revenue | 224 | | | 133 | | Unbilled revenue | 208 | | | 133 | |
| Miscellaneous accounts receivable | Miscellaneous accounts receivable | 92 | | | 36 | | Miscellaneous accounts receivable | 93 | | | 36 | |
| Inventories | Inventories | 395 | | | 386 | | Inventories | 406 | | | 386 | |
| Current regulatory assets | Current regulatory assets | 148 | | | 60 | | Current regulatory assets | 172 | | | 60 | |
| Other current assets | Other current assets | 106 | | | 79 | | Other current assets | 170 | | | 79 | |
| Total current assets | Total current assets | 1,274 | | | 1,192 | | Total current assets | 1,390 | | | 1,192 | |
| Property, Plant, and Equipment, Net | Property, Plant, and Equipment, Net | 14,690 | | | 13,879 | | Property, Plant, and Equipment, Net | 14,934 | | | 13,879 | |
| Investments and Other Assets: | Investments and Other Assets: | | Investments and Other Assets: | |
| Nuclear decommissioning trust fund | Nuclear decommissioning trust fund | 1,070 | | | 982 | | Nuclear decommissioning trust fund | 1,076 | | | 982 | |
| | Regulatory assets | Regulatory assets | 430 | | | 347 | | Regulatory assets | 483 | | | 347 | |
| Other assets | Other assets | 361 | | | 383 | | Other assets | 385 | | | 383 | |
| Total investments and other assets | Total investments and other assets | 1,861 | | | 1,712 | | Total investments and other assets | 1,944 | | | 1,712 | |
| TOTAL ASSETS | TOTAL ASSETS | $ | 17,825 | | | $ | 16,783 | | TOTAL ASSETS | $ | 18,268 | | | $ | 16,783 | |
| LIABILITIES AND SHAREHOLDERS’ EQUITY | LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | LIABILITIES AND SHAREHOLDERS’ EQUITY | | | |
| Current Liabilities: | Current Liabilities: | | Current Liabilities: | |
| Current maturities of long-term debt | Current maturities of long-term debt | $ | 8 | | | $ | 8 | | Current maturities of long-term debt | $ | 8 | | | $ | 8 | |
| | Accounts and wages payable | Accounts and wages payable | 403 | | | 501 | | Accounts and wages payable | 380 | | | 501 | |
| Accounts payable – affiliates | Accounts payable – affiliates | 85 | | | 46 | | Accounts payable – affiliates | 47 | | | 46 | |
| Taxes accrued | Taxes accrued | 137 | | | 42 | | Taxes accrued | 206 | | | 42 | |
| Interest accrued | Interest accrued | 67 | | | 53 | | Interest accrued | 62 | | | 53 | |
| Mark-to-market derivative liabilities | | Mark-to-market derivative liabilities | 75 | | | 10 | |
| Current asset retirement obligations | Current asset retirement obligations | 59 | | | 60 | | Current asset retirement obligations | 59 | | | 60 | |
| | Current regulatory liabilities | | Current regulatory liabilities | 56 | | | 26 | |
| Other current liabilities | Other current liabilities | 161 | | | 123 | | Other current liabilities | 111 | | | 87 | |
| Total current liabilities | Total current liabilities | 920 | | | 833 | | Total current liabilities | 1,004 | | | 833 | |
| Long-term Debt, Net | Long-term Debt, Net | 5,618 | | | 5,096 | | Long-term Debt, Net | 5,618 | | | 5,096 | |
| Deferred Credits and Other Liabilities: | Deferred Credits and Other Liabilities: | | Deferred Credits and Other Liabilities: | |
| Accumulated deferred income taxes and tax credits, net | Accumulated deferred income taxes and tax credits, net | 1,789 | | | 1,742 | | Accumulated deferred income taxes and tax credits, net | 1,822 | | | 1,742 | |
| | Regulatory liabilities | Regulatory liabilities | 3,138 | | | 3,110 | | Regulatory liabilities | 3,114 | | | 3,110 | |
| Asset retirement obligations | Asset retirement obligations | 707 | | | 691 | | Asset retirement obligations | 700 | | | 691 | |
| Pension and other postretirement benefits | Pension and other postretirement benefits | 31 | | | 35 | | Pension and other postretirement benefits | 30 | | | 35 | |
| Other deferred credits and liabilities | Other deferred credits and liabilities | 71 | | | 66 | | Other deferred credits and liabilities | 54 | | | 66 | |
| Total deferred credits and other liabilities | Total deferred credits and other liabilities | 5,736 | | | 5,644 | | Total deferred credits and other liabilities | 5,720 | | | 5,644 | |
| Commitments and Contingencies (Notes 2, 8, 9, and 10) | Commitments and Contingencies (Notes 2, 8, 9, and 10) | 0 | | 0 | Commitments and Contingencies (Notes 2, 8, 9, and 10) | 0 | | 0 |
| Shareholders’ Equity: | Shareholders’ Equity: | | Shareholders’ Equity: | |
| Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding | Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding | 511 | | | 511 | | Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding | 511 | | | 511 | |
| Other paid-in capital, principally premium on common stock | Other paid-in capital, principally premium on common stock | 2,701 | | | 2,518 | | Other paid-in capital, principally premium on common stock | 2,701 | | | 2,518 | |
| Preferred stock | Preferred stock | 80 | | | 80 | | Preferred stock | 80 | | | 80 | |
| Retained earnings | Retained earnings | 2,259 | | | 2,101 | | Retained earnings | 2,634 | | | 2,101 | |
| Total shareholders’ equity | Total shareholders’ equity | 5,551 | | | 5,210 | | Total shareholders’ equity | 5,926 | | | 5,210 | |
| TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 17,825 | | | $ | 16,783 | | TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $ | 18,268 | | | $ | 16,783 | |
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)
| | | Six Months Ended June 30, | | Nine Months Ended September 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
| Cash Flows From Operating Activities: | Cash Flows From Operating Activities: | | | | Cash Flows From Operating Activities: | | | |
| Net income | Net income | $ | 160 | | | $ | 144 | | Net income | $ | 536 | | | $ | 442 | |
| Adjustments to reconcile net income to net cash provided by operating activities: | Adjustments to reconcile net income to net cash provided by operating activities: | | Adjustments to reconcile net income to net cash provided by operating activities: | |
| | Depreciation and amortization | Depreciation and amortization | 343 | | | 300 | | Depreciation and amortization | 522 | | | 452 | |
| Amortization of nuclear fuel | Amortization of nuclear fuel | 20 | | | 45 | | Amortization of nuclear fuel | 37 | | | 68 | |
| | Amortization of debt issuance costs and premium/discounts | Amortization of debt issuance costs and premium/discounts | 3 | | | 3 | | Amortization of debt issuance costs and premium/discounts | 5 | | | 4 | |
| Deferred income taxes and investment tax credits, net | Deferred income taxes and investment tax credits, net | (2) | | | 14 | | Deferred income taxes and investment tax credits, net | (7) | | | (1) | |
| Allowance for equity funds used during construction | Allowance for equity funds used during construction | (10) | | | (8) | | Allowance for equity funds used during construction | (17) | | | (15) | |
| Other | Other | 6 | | | 6 | | Other | 8 | | | 13 | |
| Changes in assets and liabilities: | Changes in assets and liabilities: | | Changes in assets and liabilities: | |
| Receivables | Receivables | (135) | | | (149) | | Receivables | (216) | | | (93) | |
| Inventories | Inventories | (8) | | | (32) | | Inventories | (19) | | | (33) | |
| Accounts and wages payable | Accounts and wages payable | (172) | | | (175) | | Accounts and wages payable | (145) | | | (168) | |
| Taxes accrued | Taxes accrued | 167 | | | 151 | | Taxes accrued | 146 | | | 158 | |
| Regulatory assets and liabilities | Regulatory assets and liabilities | (165) | | | (13) | | Regulatory assets and liabilities | (164) | | | (56) | |
| Assets, other | Assets, other | (7) | | | 15 | | Assets, other | (40) | | | (10) | |
| Liabilities, other | Liabilities, other | 19 | | | (10) | | Liabilities, other | (7) | | | (46) | |
| Pension and other postretirement benefits | Pension and other postretirement benefits | 5 | | | 1 | | Pension and other postretirement benefits | 6 | | | (6) | |
| | Net cash provided by operating activities | Net cash provided by operating activities | 224 | | | 292 | | Net cash provided by operating activities | 645 | | | 709 | |
| Cash Flows From Investing Activities: | Cash Flows From Investing Activities: | | | | Cash Flows From Investing Activities: | | | |
| Capital expenditures | Capital expenditures | (684) | | | (516) | | Capital expenditures | (1,052) | | | (778) | |
| Wind generation expenditures | Wind generation expenditures | (417) | | | 0 | | Wind generation expenditures | (515) | | | — | |
| Nuclear fuel expenditures | Nuclear fuel expenditures | (4) | | | (56) | | Nuclear fuel expenditures | (19) | | | (61) | |
| Purchases of securities – nuclear decommissioning trust fund | Purchases of securities – nuclear decommissioning trust fund | (203) | | | (153) | | Purchases of securities – nuclear decommissioning trust fund | (411) | | | (169) | |
| Sales and maturities of securities – nuclear decommissioning trust fund | Sales and maturities of securities – nuclear decommissioning trust fund | 208 | | | 121 | | Sales and maturities of securities – nuclear decommissioning trust fund | 404 | | | 135 | |
| | Money pool advances, net | Money pool advances, net | 47 | | | 0 | | Money pool advances, net | 115 | | | (5) | |
| | Other | | Other | — | | | 1 | |
| Net cash used in investing activities | Net cash used in investing activities | (1,053) | | | (604) | | Net cash used in investing activities | (1,478) | | | (877) | |
| Cash Flows From Financing Activities: | Cash Flows From Financing Activities: | | | | Cash Flows From Financing Activities: | | | |
| | Dividends on preferred stock | Dividends on preferred stock | (2) | | | (2) | | Dividends on preferred stock | (3) | | | (3) | |
| Short-term debt, net | Short-term debt, net | 0 | | | (155) | | Short-term debt, net | — | | | (234) | |
| Money pool borrowings, net | 0 | | | 65 | | |
| | Maturities of long-term debt | Maturities of long-term debt | 0 | | | (85) | | Maturities of long-term debt | — | | | (85) | |
| Issuances of long-term debt | Issuances of long-term debt | 524 | | | 465 | | Issuances of long-term debt | 524 | | | 465 | |
| Capital contribution from parent | Capital contribution from parent | 183 | | | — | | Capital contribution from parent | 183 | | | — | |
| Debt issuance costs | Debt issuance costs | (4) | | | (4) | | Debt issuance costs | (5) | | | (4) | |
| Net cash provided by financing activities | Net cash provided by financing activities | 701 | | | 284 | | Net cash provided by financing activities | 699 | | | 139 | |
| Net change in cash, cash equivalents, and restricted cash | Net change in cash, cash equivalents, and restricted cash | (128) | | | (28) | | Net change in cash, cash equivalents, and restricted cash | (134) | | | (29) | |
| Cash, cash equivalents, and restricted cash at beginning of year | Cash, cash equivalents, and restricted cash at beginning of year | 145 | | | 39 | | Cash, cash equivalents, and restricted cash at beginning of year | 145 | | | 39 | |
| Cash, cash equivalents, and restricted cash at end of period | Cash, cash equivalents, and restricted cash at end of period | $ | 17 | | | $ | 11 | | Cash, cash equivalents, and restricted cash at end of period | $ | 11 | | | $ | 10 | |
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 SHAREHOLDERS’ EQUITY
(Unaudited) (In millions)
| | | | Three Months Ended June 30, | | Six Months Ended June 30, | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Common Stock | Common Stock | $ | 511 | | | $ | 511 | | | $ | 511 | | | $ | 511 | | Common Stock | $ | 511 | | | $ | 511 | | | $ | 511 | | | $ | 511 | |
| | Other Paid-in Capital: | Other Paid-in Capital: | | Other Paid-in Capital: | |
| Beginning of period | Beginning of period | 2,631 | | | 2,027 | | | 2,518 | | | 2,027 | | Beginning of period | 2,701 | | | 2,027 | | | 2,518 | | | 2,027 | |
| Capital contributions from parent | Capital contributions from parent | 70 | | | 0 | | | 183 | | | 0 | | Capital contributions from parent | — | | | — | | | 183 | | | — | |
| | Other paid-in capital, end of period | Other paid-in capital, end of period | 2,701 | | | 2,027 | | | 2,701 | | | 2,027 | | Other paid-in capital, end of period | 2,701 | | | 2,027 | | | 2,701 | | | 2,027 | |
| | | Preferred Stock | Preferred Stock | 80 | | | 80 | | | 80 | | | 80 | | Preferred Stock | 80 | | | 80 | | | 80 | | | 80 | |
| | Retained Earnings: | Retained Earnings: | | Retained Earnings: | |
| Beginning of period | Beginning of period | 2,148 | | | 1,721 | | | 2,101 | | | 1,731 | | Beginning of period | 2,259 | | | 1,873 | | | 2,101 | | | 1,731 | |
| Net income | Net income | 112 | | | 153 | | | 160 | | | 144 | | Net income | 376 | | | 298 | | | 536 | | | 442 | |
| | Dividends on preferred stock | Dividends on preferred stock | (1) | | | (1) | | | (2) | | | (2) | | Dividends on preferred stock | (1) | | | (1) | | | (3) | | | (3) | |
| Retained earnings, end of period | Retained earnings, end of period | 2,259 | | | 1,873 | | | 2,259 | | | 1,873 | | Retained earnings, end of period | 2,634 | | | 2,170 | | | 2,634 | | | 2,170 | |
| | Total Shareholders’ Equity | Total Shareholders’ Equity | $ | 5,551 | | | $ | 4,491 | | | $ | 5,551 | | | $ | 4,491 | | Total Shareholders’ Equity | $ | 5,926 | | | $ | 4,788 | | | $ | 5,926 | | | $ | 4,788 | |
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
(Unaudited) (In millions)
| | | | Three Months Ended June 30, | | Six Months Ended June 30, | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Operating Revenues: | Operating Revenues: | | | | | | | | Operating Revenues: | | | | | | | |
| Electric | Electric | $ | 461 | | | $ | 427 | | | $ | 937 | | | $ | 879 | | Electric | $ | 518 | | | $ | 467 | | | $ | 1,455 | | | $ | 1,346 | |
| Natural gas | Natural gas | 168 | | | 140 | | | 515 | | | 411 | | Natural gas | 127 | | | 122 | | | 642 | | | 533 | |
| Total operating revenues | Total operating revenues | 629 | | | 567 | | | 1,452 | | | 1,290 | | Total operating revenues | 645 | | | 589 | | | 2,097 | | | 1,879 | |
| Operating Expenses: | Operating Expenses: | | | | | | | | Operating Expenses: | | | | | | | |
| Purchased power | Purchased power | 84 | | | 76 | | | 190 | | | 174 | | Purchased power | 108 | | | 97 | | | 298 | | | 271 | |
| Natural gas purchased for resale | Natural gas purchased for resale | 60 | | | 36 | | | 194 | | | 125 | | Natural gas purchased for resale | 41 | | | 29 | | | 235 | | | 154 | |
| Other operations and maintenance | Other operations and maintenance | 193 | | | 182 | | | 387 | | | 381 | | Other operations and maintenance | 217 | | | 197 | | | 604 | | | 578 | |
| Depreciation and amortization | Depreciation and amortization | 117 | | | 107 | | | 232 | | | 214 | | Depreciation and amortization | 118 | | | 109 | | | 350 | | | 323 | |
| Taxes other than income taxes | Taxes other than income taxes | 34 | | | 32 | | | 80 | | | 74 | | Taxes other than income taxes | 34 | | | 33 | | | 114 | | | 107 | |
| Total operating expenses | Total operating expenses | 488 | | | 433 | | | 1,083 | | | 968 | | Total operating expenses | 518 | | | 465 | | | 1,601 | | | 1,433 | |
| Operating Income | Operating Income | 141 | | | 134 | | | 369 | | | 322 | | Operating Income | 127 | | | 124 | | | 496 | | | 446 | |
| | Other Income, Net | Other Income, Net | 16 | | | 17 | | | 30 | | | 28 | | Other Income, Net | 19 | | | 17 | | | 49 | | | 45 | |
| Interest Charges | Interest Charges | 40 | | | 38 | | | 82 | | | 77 | | Interest Charges | 41 | | | 39 | | | 123 | | | 116 | |
| Income Before Income Taxes | Income Before Income Taxes | 117 | | | 113 | | | 317 | | | 273 | | Income Before Income Taxes | 105 | | | 102 | | | 422 | | | 375 | |
| Income Taxes | Income Taxes | 31 | | | 29 | | | 81 | | | 68 | | Income Taxes | 26 | | | 25 | | | 107 | | | 93 | |
| Net Income | Net Income | 86 | | | 84 | | | 236 | | | 205 | | Net Income | 79 | | | 77 | | | 315 | | | 282 | |
| | Preferred Stock Dividends | Preferred Stock Dividends | 0 | | | 1 | | | 1 | | | 2 | | Preferred Stock Dividends | — | | | — | | | 1 | | | 2 | |
| Net Income Available to Common Shareholder | Net Income Available to Common Shareholder | $ | 86 | | | $ | 83 | | | $ | 235 | | | $ | 203 | | Net Income Available to Common Shareholder | $ | 79 | | | $ | 77 | | | $ | 314 | | | $ | 280 | |
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)
| | | June 30, 2021 | | December 31, 2020 | | September 30, 2021 | | December 31, 2020 |
| ASSETS | ASSETS | | | | ASSETS | | | |
| Current Assets: | Current Assets: | | Current Assets: | |
| Cash and cash equivalents | Cash and cash equivalents | $ | 96 | | | $ | 0 | | Cash and cash equivalents | $ | — | | | $ | — | |
| Advances to money pool | Advances to money pool | 20 | | | 0 | | Advances to money pool | 41 | | | — | |
| Accounts receivable – trade (less allowance for doubtful accounts of $26 and $34, respectively) | 212 | | | 234 | | |
| Accounts receivable – trade (less allowance for doubtful accounts of $22 and $34, respectively) | | Accounts receivable – trade (less allowance for doubtful accounts of $22 and $34, respectively) | 237 | | | 234 | |
| Accounts receivable – affiliates | Accounts receivable – affiliates | 57 | | | 64 | | Accounts receivable – affiliates | 94 | | | 64 | |
| Unbilled revenue | Unbilled revenue | 115 | | | 136 | | Unbilled revenue | 124 | | | 136 | |
| Miscellaneous accounts receivable | Miscellaneous accounts receivable | 4 | | | 12 | | Miscellaneous accounts receivable | 8 | | | 12 | |
| Inventories | Inventories | 132 | | | 135 | | Inventories | 189 | | | 135 | |
| Restricted cash | 122 | | | 6 | | |
| Mark-to-market derivative assets | | Mark-to-market derivative assets | 56 | | | 8 | |
| | Current regulatory assets | Current regulatory assets | 199 | | | 37 | | Current regulatory assets | 183 | | | 37 | |
| | Other current assets | Other current assets | 38 | | | 23 | | Other current assets | 28 | | | 21 | |
| Total current assets | Total current assets | 995 | | | 647 | | Total current assets | 960 | | | 647 | |
| Property, Plant, and Equipment, Net | Property, Plant, and Equipment, Net | 11,597 | | | 11,201 | | Property, Plant, and Equipment, Net | 11,891 | | | 11,201 | |
| Investments and Other Assets: | Investments and Other Assets: | | Investments and Other Assets: | |
| Goodwill | Goodwill | 411 | | | 411 | | Goodwill | 411 | | | 411 | |
| Regulatory assets | Regulatory assets | 822 | | | 742 | | Regulatory assets | 730 | | | 742 | |
| Other assets | Other assets | 491 | | | 534 | | Other assets | 599 | | | 534 | |
| Total investments and other assets | Total investments and other assets | 1,724 | | | 1,687 | | Total investments and other assets | 1,740 | | | 1,687 | |
| TOTAL ASSETS | TOTAL ASSETS | $ | 14,316 | | | $ | 13,535 | | TOTAL ASSETS | $ | 14,591 | | | $ | 13,535 | |
| LIABILITIES AND SHAREHOLDERS' EQUITY | LIABILITIES AND SHAREHOLDERS' EQUITY | | | | LIABILITIES AND SHAREHOLDERS' EQUITY | | | |
| Current Liabilities: | Current Liabilities: | | Current Liabilities: | |
| | Borrowings from money pool | Borrowings from money pool | $ | 0 | | | $ | 19 | | Borrowings from money pool | $ | — | | | $ | 19 | |
| Accounts and wages payable | Accounts and wages payable | 314 | | | 363 | | Accounts and wages payable | 340 | | | 363 | |
| Accounts payable – affiliates | Accounts payable – affiliates | 62 | | | 51 | | Accounts payable – affiliates | 59 | | | 51 | |
| | Customer deposits | Customer deposits | 69 | | | 74 | | Customer deposits | 57 | | | 74 | |
| | Current environmental remediation | | Current environmental remediation | 39 | | | 37 | |
| Current regulatory liabilities | Current regulatory liabilities | 197 | | | 88 | | Current regulatory liabilities | 81 | | | 88 | |
| Other current liabilities | Other current liabilities | 205 | | | 221 | | Other current liabilities | 170 | | | 184 | |
| Total current liabilities | Total current liabilities | 847 | | | 816 | | Total current liabilities | 746 | | | 816 | |
| Long-term Debt, Net | Long-term Debt, Net | 4,391 | | | 3,946 | | Long-term Debt, Net | 4,391 | | | 3,946 | |
| Deferred Credits and Other Liabilities: | Deferred Credits and Other Liabilities: | | Deferred Credits and Other Liabilities: | |
| Accumulated deferred income taxes and investment tax credits, net | Accumulated deferred income taxes and investment tax credits, net | 1,463 | | | 1,367 | | Accumulated deferred income taxes and investment tax credits, net | 1,520 | | | 1,367 | |
| | Regulatory liabilities | Regulatory liabilities | 2,006 | | | 2,063 | | Regulatory liabilities | 2,193 | | | 2,063 | |
| Pension and other postretirement benefits | Pension and other postretirement benefits | 68 | | | 69 | | Pension and other postretirement benefits | 60 | | | 69 | |
| Environmental remediation | Environmental remediation | 46 | | | 57 | | Environmental remediation | 41 | | | 57 | |
| Other deferred credits and liabilities | Other deferred credits and liabilities | 237 | | | 251 | | Other deferred credits and liabilities | 228 | | | 251 | |
| Total deferred credits and other liabilities | Total deferred credits and other liabilities | 3,820 | | | 3,807 | | Total deferred credits and other liabilities | 4,042 | | | 3,807 | |
| Commitments and Contingencies (Notes 2, 8 and 9) | Commitments and Contingencies (Notes 2, 8 and 9) | 0 | | 0 | Commitments and Contingencies (Notes 2, 8 and 9) | 0 | | 0 |
| Shareholders' Equity: | Shareholders' Equity: | | Shareholders' Equity: | |
| Common stock, 0 par value, 45.0 shares authorized – 25.5 shares outstanding | 0 | | | 0 | | |
| Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding | | Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding | — | | | — | |
| Other paid-in capital | Other paid-in capital | 2,722 | | | 2,652 | | Other paid-in capital | 2,797 | | | 2,652 | |
| Preferred stock | Preferred stock | 49 | | | 62 | | Preferred stock | 49 | | | 62 | |
| Retained earnings | Retained earnings | 2,487 | | | 2,252 | | Retained earnings | 2,566 | | | 2,252 | |
| | Total shareholders' equity | Total shareholders' equity | 5,258 | | | 4,966 | | Total shareholders' equity | 5,412 | | | 4,966 | |
| TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 14,316 | | | $ | 13,535 | | TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 14,591 | | | $ | 13,535 | |
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)
| | | Six Months Ended June 30, | | Nine Months Ended September 30, |
| | 2021 | | 2020 | | 2021 | | 2020 |
| Cash Flows From Operating Activities: | Cash Flows From Operating Activities: | | | | Cash Flows From Operating Activities: | | | |
| Net income | Net income | $ | 236 | | | $ | 205 | | Net income | $ | 315 | | | $ | 282 | |
| Adjustments to reconcile net income to net cash provided by operating activities: | Adjustments to reconcile net income to net cash provided by operating activities: | | Adjustments to reconcile net income to net cash provided by operating activities: | |
| Depreciation and amortization | Depreciation and amortization | 231 | | | 214 | | Depreciation and amortization | 349 | | | 322 | |
| Amortization of debt issuance costs and premium/discounts | Amortization of debt issuance costs and premium/discounts | 6 | | | 6 | | Amortization of debt issuance costs and premium/discounts | 10 | | | 9 | |
| Deferred income taxes and investment tax credits, net | Deferred income taxes and investment tax credits, net | 84 | | | 40 | | Deferred income taxes and investment tax credits, net | 134 | | | 72 | |
| | Allowance for equity funds used during construction | | Allowance for equity funds used during construction | (13) | | | (10) | |
| Other | Other | (1) | | | (5) | | Other | 8 | | | 10 | |
| Changes in assets and liabilities: | Changes in assets and liabilities: | | Changes in assets and liabilities: | |
| Receivables | Receivables | 43 | | | (13) | | Receivables | 8 | | | (9) | |
| Inventories | Inventories | 3 | | | 13 | | Inventories | (54) | | | (28) | |
| Accounts and wages payable | Accounts and wages payable | (23) | | | (12) | | Accounts and wages payable | 12 | | | (12) | |
| Taxes accrued | Taxes accrued | 36 | | | (32) | | Taxes accrued | (21) | | | (20) | |
| Regulatory assets and liabilities | Regulatory assets and liabilities | (273) | | | (65) | | Regulatory assets and liabilities | (167) | | | 11 | |
| Assets, other | Assets, other | (46) | | | (15) | | Assets, other | (59) | | | (52) | |
| Liabilities, other | Liabilities, other | (2) | | | 12 | | Liabilities, other | 1 | | | (30) | |
| Pension and other postretirement benefits | Pension and other postretirement benefits | (8) | | | (8) | | Pension and other postretirement benefits | (16) | | | (30) | |
| | Net cash provided by operating activities | Net cash provided by operating activities | 286 | | | 340 | | Net cash provided by operating activities | 507 | | | 515 | |
| Cash Flows From Investing Activities: | Cash Flows From Investing Activities: | | | | Cash Flows From Investing Activities: | | | |
| Capital expenditures | Capital expenditures | (646) | | | (661) | | Capital expenditures | (1,026) | | | (1,031) | |
| Money pool advances, net | Money pool advances, net | (20) | | | 0 | | Money pool advances, net | (41) | | | — | |
| Other | Other | (2) | | | 2 | | Other | (7) | | | 1 | |
| Net cash used in investing activities | Net cash used in investing activities | (668) | | | (659) | | Net cash used in investing activities | (1,074) | | | (1,030) | |
| Cash Flows From Financing Activities: | Cash Flows From Financing Activities: | | | | Cash Flows From Financing Activities: | | | |
| | Dividends on preferred stock | Dividends on preferred stock | (1) | | | (2) | | Dividends on preferred stock | (1) | | | (2) | |
| Short-term debt, net | Short-term debt, net | 0 | | | (12) | | Short-term debt, net | — | | | 189 | |
| Money pool borrowings, net | Money pool borrowings, net | (19) | | | 0 | | Money pool borrowings, net | (19) | | | — | |
| | Issuances of long-term debt | Issuances of long-term debt | 449 | | | 0 | | Issuances of long-term debt | 449 | | | — | |
| Capital contributions from parent | Capital contributions from parent | 70 | | | 350 | | Capital contributions from parent | 145 | | | 350 | |
| Redemption of preferred stock | Redemption of preferred stock | (13) | | | 0 | | Redemption of preferred stock | (13) | | | — | |
| | Debt issuance costs | Debt issuance costs | (5) | | | 0 | | Debt issuance costs | (6) | | | — | |
| Other | Other | (4) | | | 0 | | Other | (13) | | | — | |
| Net cash provided by financing activities | Net cash provided by financing activities | 477 | | | 336 | | Net cash provided by financing activities | 542 | | | 537 | |
| Net change in cash, cash equivalents, and restricted cash | Net change in cash, cash equivalents, and restricted cash | 95 | | | 17 | | Net change in cash, cash equivalents, and restricted cash | (25) | | | 22 | |
| Cash, cash equivalents and restricted cash at beginning of year | Cash, cash equivalents and restricted cash at beginning of year | 147 | | | 125 | | Cash, cash equivalents and restricted cash at beginning of year | 147 | | | 125 | |
| Cash, cash equivalents, and restricted cash at end of period | Cash, cash equivalents, and restricted cash at end of period | $ | 242 | | | $ | 142 | | Cash, cash equivalents, and restricted cash at end of period | $ | 122 | | | $ | 147 | |
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 SHAREHOLDERS’ EQUITY
(Unaudited) (In millions)
| | | | Three Months Ended June 30, | | Six Months Ended June 30, | | Three Months Ended September 30, | | Nine Months Ended September 30, |
| | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Common Stock | Common Stock | $ | 0 | | | $ | 0 | | | $ | 0 | | | $ | 0 | | Common Stock | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| | Other Paid-in Capital: | Other Paid-in Capital: | | Other Paid-in Capital: | |
| Beginning of period | Beginning of period | 2,692 | | | 2,288 | | | 2,652 | | | 2,188 | | Beginning of period | 2,722 | | | 2,538 | | | 2,652 | | | 2,188 | |
| Capital contributions from parent | Capital contributions from parent | 30 | | | 250 | | | 70 | | | 350 | | Capital contributions from parent | 75 | | | — | | | 145 | | | 350 | |
| | Other paid-in capital, end of period | Other paid-in capital, end of period | 2,722 | | | 2,538 | | | 2,722 | | | 2,538 | | Other paid-in capital, end of period | 2,797 | | | 2,538 | | | 2,797 | | | 2,538 | |
| | | Preferred Stock: | Preferred Stock: | | Preferred Stock: | |
| Beginning of period | Beginning of period | 49 | | | 62 | | | 62 | | | 62 | | Beginning of period | 49 | | | 62 | | | 62 | | | 62 | |
| Redemptions of preferred stock | Redemptions of preferred stock | 0 | | | 0 | | | (13) | | | 0 | | Redemptions of preferred stock | — | | | — | | | (13) | | | — | |
| | Preferred stock, end of period | Preferred stock, end of period | 49 | | | 62 | | | 49 | | | 62 | | Preferred stock, end of period | 49 | | | 62 | | | 49 | | | 62 | |
| | Retained Earnings: | Retained Earnings: | | Retained Earnings: | |
| Beginning of period | Beginning of period | 2,401 | | | 2,002 | | | 2,252 | | | 1,882 | | Beginning of period | 2,487 | | | 2,085 | | | 2,252 | | | 1,882 | |
| Net income | Net income | 86 | | | 84 | | | 236 | | | 205 | | Net income | 79 | | | 77 | | | 315 | | | 282 | |
| | Dividends on preferred stock | Dividends on preferred stock | 0 | | | (1) | | | (1) | | | (2) | | Dividends on preferred stock | — | | | — | | | (1) | | | (2) | |
| | Retained earnings, end of period | Retained earnings, end of period | 2,487 | | | 2,085 | | | 2,487 | | | 2,085 | | Retained earnings, end of period | 2,566 | | | 2,162 | | | 2,566 | | | 2,162 | |
| | | Total Shareholders’ Equity | Total Shareholders’ Equity | $ | 5,258 | | | $ | 4,685 | | | $ | 5,258 | | | $ | 4,685 | | Total Shareholders’ Equity | $ | 5,412 | | | $ | 4,762 | | | $ | 5,412 | | | $ | 4,762 | |
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)
JuneSeptember 30, 2021
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General
Ameren, headquartered in St. Louis, Missouri, is a public utility holding company whose primary assets are its equity interests in its subsidiaries. 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. Ameren has other subsidiaries that conduct other activities, such as providing shared services.
•Union Electric Company, doing business as Ameren Missouri, operates a rate-regulated electric generation, transmission, and distribution business and a rate-regulated natural gas distribution business in Missouri.
•Ameren Illinois Company, doing business as Ameren Illinois, operates rate-regulated electric transmission, electric distribution, and natural gas distribution businesses in Illinois.
•ATXI operates a FERC rate-regulated electric transmission business in the MISO.
The COVID-19 pandemic continues to affect our results of operations, financial position, and liquidity, but we continue to expect gradual improvement in sales volumes in 2021, compared to 2020. In the first sixnine months of 2021, our sales volumes, excluding the estimated effects of weather and customer energy-efficiency programs, increased compared to the same period in 2020. However, our accounts receivable balances that were past due or that were a part of a deferred payment arrangement are higher than normal historical levels, as customer payments have been affected.The continued effect of the COVID-19 pandemic on our results of operations, financial position, and liquidity in subsequent periods will depend on its severity and longevity, future regulatory or legislative actions with respect thereto, and the resulting impact on business, economic, and capital market conditions. In general, restrictions on social activities and nonessential businesses implemented in our service territories in 2020 have been relaxed.relaxed However, additional restrictions may be imposed in the future..
We continue to assess the impacts the COVID-19 pandemic is having on our businesses, including but not limited to impacts on our liquidity; demand for residential, commercial, and industrial electric and natural gas services; changes in deferred payment arrangements for customers; the timing and extent to which recovery of incremental costs incurred, net of savings, and forgone customer late fee revenues at Ameren Missouri is allowed by the MoPSC; changes in our ability to disconnect customers for nonpayment; bad debt expense; supply chain operations; the availability of our employees and contractors; counterparty credit; capital construction; infrastructure operations and maintenance; energy-efficiency programs; and pension valuations. In March 2021, the MoPSC approved accounting authority orders that allowed Ameren Missouri to accumulate $9 million of certain costs incurred related to the COVID-19 pandemic, net of savings, as well as forgone customer late fees and reconnection fee revenues from March 2020 to March 2021, for potential recovery in the current electric and natural gas service regulatory rate reviews. While the revenues from Ameren Illinois’ electric distribution business, residential and small nonresidential customers of Ameren Illinois’ natural gas distribution business, and Ameren Illinois’ and ATXI’s electric transmission businesses are decoupled from changes in sales volumes, earnings at Ameren Missouri and those associated with Ameren Illinois’ large nonresidential natural gas customers are exposed to such changes. Regarding uncollectible accounts receivable, Ameren Illinois’ electric distribution and natural gas distribution businesses have bad debt riders, which provide for recovery of bad debt write-offs, net of any subsequent recoveries. Ameren Missouri does not have a bad debt rider or tracker, and thus its earnings are exposed to increases in bad debt expense, absent regulatory relief. However, Ameren Missouri has not experienced and does not expect a material impact to earnings from increases in bad debt expense. As of JuneSeptember 30, 2021, accounts receivable balances that were 30 days or greater past due or that were a part of a deferred payment arrangement represented 26%18%, 17%12%, and 35%25%, or $116$97 million, $32$33 million, and $84$64 million, of Ameren’s, Ameren Missouri’s, and Ameren Illinois’ customer trade receivables before allowance for doubtful accounts, respectively. In comparison, as of JuneSeptember 30, 2019, these percentages were 17%13%, 11%9%, and 25%18%, or $83$65 million, $24$23 million, and $59$42 million, for Ameren, Ameren Missouri, and Ameren Illinois, respectively. For information regarding Ameren Illinois’ suspension and subsequent reinstatement of customer disconnections and late fee charges for nonpayment and Ameren Missouri’s accounting authority orders related to the COVID-19 pandemic, see Note 2 – Rate and Regulatory Matters below.
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. 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 statement 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 for 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 accompanying notes included in the Form 10-K.
Variable Interest Entities
As of JuneSeptember 30, 2021, and December 31, 2020, Ameren had unconsolidated variable interests as a limited partner in various equity method investments, totaling $48$53 million and $37 million, respectively, included in “Other assets” on Ameren’s consolidated balance sheet. Ameren is not the primary beneficiary of these investments because it does not have the power to direct matters that most significantly affect the activities of these variable interest entities. As of JuneSeptember 30, 2021, the maximum exposure to loss related to these variable interests is limited to the investment in these partnerships of $48$53 million plus associated outstanding funding commitments of $30$27 million.
Company-owned Life Insurance
Ameren and Ameren Illinois have company-owned life insurance, which is recorded at the net cash surrender value. The net cash surrender value is the amount that can be realized under the insurance policies at the balance sheet date. As of JuneSeptember 30, 2021, the cash surrender value of company-owned life insurance at Ameren and Ameren Illinois was $279$273 million (December 31, 2020 – $272 million) and $119$115 million (December 31, 2020 – $115 million), respectively, while total borrowings against the policies were $112$109 million (December 31, 2020 – $107 million) at both Ameren and Ameren Illinois. Ameren and Ameren Illinois have the right to offset the borrowings against the cash surrender value of the policies and, consequently, present the net asset in “Other assets” on their respective balance sheets.
NOTE 2 – RATE AND REGULATORY MATTERS
Below is a summary of updates to significant regulatory proceedings and related legal proceedings. See Note 2 – Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K for additional information and a summary of our regulatory frameworks. We are unable to predict the ultimate outcome of these matters, the timing of final decisions of the various agencies and courts, or the impact on our results of operations, financial position, or liquidity.
Missouri
2021 Electric Service Regulatory Rate Review
In March 2021, Ameren Missouri filed a request with the MoPSC seeking approval to increase its annual revenues for electric service by $299 million. The electric rate increase request is based on a 9.9% ROE, a capital structure composed of 51.9% common equity, a rate base of $10.0 billion, and a test year ended December 31, 2020, with certain pro-forma adjustments expected through a true-up date of September 30, 2021. Ameren Missouri also requested the continued use of the FAC and trackers for pension and postretirement benefits, uncertain income tax positions, and certain excess deferred income taxes that the MoPSC previously authorized in earlier electric rate orders. Additionally, Ameren Missouri requested to recover certain estimated costs associated with the Meramec Energy Center, which is expected to be retired in 2022, over a five-year period. Ameren Missouri requested the use of a tracker for any variances between certain costs collected in customer rates associated with the Meramec Energy Center and actual recoverable costs incurred after the date new rates become effective, which would be considered for recovery or refund in a future electric regulatory rate review. The electric rate increase request reflects the following:
•increased infrastructure investments made under Ameren Missouri’s Smart Energy Plan;
•the impact of the transition to a cleaner generation portfolio, including advancing the retirement dates of the Sioux and Rush Island energy centers consistent with Ameren Missouri’s 2020 IRP and 700 MWs of wind generation investment for the High Prairie and Atchison renewable energy centers, which are mitigated by reductions resulting from the request to recover certain Meramec Energy Center costs over a five-year period and the associated tracker;
•decreased weather-normalized customer sales volumes; and
•increased pension and other post-retirement benefits and tax amortization expenses, partially offset by decreased other operations and maintenance expenses.
In October 2021, the MoPSC staff recommended an increase to Ameren Missouri's annual electric service revenues of $188 million based on a 9.5% ROE, a capital structure composed of 50.32% common equity, which was Ameren Missouri’s June 2021 capital structure, and a rate base of $10.0 billion. Ameren Missouri anticipates that the MoPSC staff will update its recommendation for Ameren Missouri’s September 2021 capital structure. The MoPSC proceeding relating tostaff supported the authorization of the proposed electric service rate changes will take place overMeramec Energy Center tracker, but
recommended tracking certain incremental costs. The MoPSC staff’s recommendation includes advancing the retirement dates of the Sioux and Rush Island energy centers consistent with Ameren Missouri’s request, but also includes lower depreciation, primarily on distribution investments, than reflected in Ameren Missouri’s request and a periodlower estimated headcount, resulting in lower payroll and benefit costs, among other things.
The MoOPC and the MIEC are challenging the prudency of upthe High Prairie Energy Center investment as a result of the curtailed nighttime operations at the energy center to 11 months,limit its impact on protected species. In September 2021, the MoOPC challenged approximately 25% of the costs and requested return associated with the High Prairie Energy Center investment included in Ameren Missouri’s requested revenue requirement. Also, in September 2021, the MIEC challenged approximately 20% of the requested return on the High Prairie Energy Center investment included in Ameren Missouri's revenue requirement and, in October 2021, challenged a portion of the return collected in 2021 through the RESRAM. Also, in October 2021, the MIEC proposed further adjustments to lower FAC and RESRAM rates, due to higher fuel costs and lower production tax credits generated as a result of the curtailed operations. See Note 9 – Commitments and Contingencies for additional information on the curtailed nighttime operations at the High Prairie Energy Center.
A decision by the MoPSC is expected by Februarymid-February 2022, andwith new rates effective by late February 2022. Ameren Missouri cannot predict the level of any electric service rate change the MoPSC may approve, whether the requested regulatory recovery mechanisms will be approved, or whether any rate change that may eventually be approved will be sufficient for Ameren Missouri to recover its costs and earn a reasonable return on its investments when the rate change goes into effect.
Atchison Renewable Energy Center
In January 2021, Ameren Missouri acquired a 300-MW wind generation project located in northwestern Missouri. As of June 30, 2021, Ameren Missouri had placed the project in service as the Atchison Renewable Energy Center. The purchase price of the energy center was approximately $500 million, including an immaterial amount of transaction costs. The Atchison Renewable Energy Center will support Ameren Missouri’s compliance with the Missouri renewable energy standard.
2021 Natural Gas Delivery Service Regulatory Rate Review
In March 2021, Ameren Missouri filed a request with the MoPSC seeking approval to increase its annual revenues for natural gas delivery service by $9 million. The natural gas rate increase request is based on a 9.8% ROE, a capital structure composed of 51.9% common equity, a rate base of $310 million, and a test year ended December 31, 2020, with certain pro-forma adjustments expected through a true-up date of September 30, 2021. The request includes the continued use of the PGA, ISRS, and DCA and trackers for pension and other postretirement benefits and certain excess deferred taxes that the MoPSC previously authorized in earlier natural gas rate orders.
TheIn October 2021, the MoPSC proceeding relatingstaff recommended an increase to the proposedAmeren Missouri's annual natural gas delivery service revenues of $4 million based on a 9.5% ROE, a capital structure composed of 50.32% common equity, which was Ameren Missouri’s June 2021 capital structure, and a rate changesbase of $301 million. Ameren Missouri anticipates that the MoPSC staff will take place overupdate its recommendation for Ameren Missouri’s September 2021 capital structure. The MoPSC staff’s recommendation includes a period of up to 11 months, with alower estimated headcount, resulting in lower payroll and benefit costs than reflected in Ameren Missouri’s request, among other things.
A decision by the MoPSC is expected by Februarymid-February 2022, andwith new rates effective by late February 2022. Ameren Missouri cannot predict the level of any natural gas delivery service rate change the MoPSC may approve, or whether any rate change that may eventually be approved will be sufficient for Ameren Missouri to recover its costs and earn a reasonable return on its investments when the rate change goes into effect.
Accounting Authority Orders Related to COVID-19 Pandemic Costs
In March 2021, the MoPSC issued orders approving nonunanimous stipulation and agreements related to Ameren Missouri’s electric and natural gas service accounting authority order requests. The orders allowed Ameren Missouri to accumulate $9 million of certain costs incurred related to the COVID-19 pandemic, net of cost savings, as well as forgone customer late fee and reconnection fee revenues from March 2020 to March 2021, for potential recovery in the electric and natural gas service regulatory rate reviews discussed above. In March 2021, Ameren Missouri deferred other operations and maintenance expenses of $5 million as a regulatory asset related to the accounting authority orders. If approved for recovery, Ameren Missouri would recognize the remaining $4 million associated with forgone customer late fee and reconnection fee revenue when billed to customers.In the electric and natural gas regulatory rate reviews discussed above, the MoPSC staff supported the recovery of the regulatory asset and forgone customer late fee and reconnection fee revenues.
MEEIA
In September 2021, the MoPSC issued an order approving Ameren Missouri’s energy savings results for the second year of the MEEIA 2019 program. As a result of this order and a MoPSC order issued in August 2020, and in accordance with revenue recognition guidance, Ameren Missouri recognized revenues of $9 million and $6 million in the third quarter of 2021 and 2020, respectively.
In October 2021, the MoPSC issued an order approving Ameren Missouri’s request to implement the 2023 program year of its six-year MEEIA 2019 program. The order established performance incentives that would provide Ameren Missouri an opportunity to earn additional revenues, including $13 million if Ameren Missouri achieves certain energy-efficiency goals during the 2023 program year. Ameren Missouri intends to invest $75 million in energy-efficiency programs during the 2023 program year.
Extension of PGA Recovery
In October 2021, the MoPSC issued an order allowing Ameren Missouri to extend the collection period for the cumulative PGA under-recovery as of August 2021, which includes the February 2021 under-recovery of $53 million, from 12 months to 36 months beginning November 2021, to lessen the impact on customer rates. Similar to other deferrals under the PGA, the deferral associated with the February 2021 under-recovery will earn carrying costs at short-term interest rates.
Illinois
Electric Distribution Service RatesCEJA
In April 2021,The CEJA was enacted in September 2021. The CEJA resulted in changes to the regulatory framework applicable to Ameren Illinois’ electric distribution business by giving Ameren Illinois filedthe option to file an MYRP with the ICC by mid-January 2023, with rates effective beginning in 2024, among other things. Ameren Illinois has the option to file for an MYRP every four years. Subject to stakeholder workshops regarding the MYRP ratemaking process, including establishing performance metrics, Ameren Illinois anticipates filing an MYRP for rates effective beginning in 2024. If it does not file then, its annual electric distribution servicenext opportunity to file an MYRP would be for rates effective beginning in 2028. Ameren Illinois expects to continue to use the current IEIMA performance-based formula rate updateratemaking framework to be used for 2022establish annual customer rates witheffective through 2023 and reconcile the ICC.related revenue requirements. In July 2021,order to utilize the IEIMA reconciliation, Ameren Illinois filedmust file either a revised request seekingtraditional regulatory rate review or an MYRP pursuant to increase its annual revenuesthe CEJA by mid-January 2023.
Under the MYRP, the ICC would approve base rates for electric distribution service by $60 million. This update reflects an increase to the annual performance-based formula ratebe charged to customers for each calendar year of a four-year period. The base rates for a particular calendar year would be based on 2020 actualforecasted recoverable costs and expected net plant additions for 2021, an increaseROE approved by the ICC applied to includeAmeren Illinois’ forecasted average annual rate base using a forecasted capital structure, with a common equity ratio of up to 50% being deemed prudent and reasonable by law and a higher equity ratio requiring specific ICC approval. The ROE approved by the 2020 revenue requirement reconciliation adjustment, and an increase for the conclusionICC is applicable to each calendar year of the 2019 revenue requirement reconciliation adjustment, which will be fully refunded to customers in 2021, consistent with the ICC’s December 2020 annual update filing order. In June 2021, the ICC staff submitted its calculation offour-year period. Under a traditional regulatory rate review, the revenue requirement included inmay be based on a future test year and would include an ROE approved by the ICC. Ameren Illinois’ update filing, recommendingexisting riders remain effective whether it elects to file an MYRP or a $54 million increase intraditional regulatory rate review. Additionally, electric distribution service revenues would continue to be decoupled from sales volumes under either election.
The MYRP would also allow Ameren Illinois’Illinois to reconcile electric distribution service rates to its actual revenue requirement on an annual basis, subject to a reconciliation cap, which isprovides that the actual revenue requirement does not exceed 105% of the annual revenue requirement approved by the ICC. Certain variations from forecasted costs would be excluded from the reconciliation cap, including those associated with major storms; new business and facility relocations; changes in the timing of expenditures or investments into or out of the applicable calendar year; and changes in interest rates, income taxes, taxes other than income taxes, pension and other post-retirement benefits costs, and amortization of certain regulatory assets. The reconciliation cap would also exclude costs recovered through riders outside of base rates, such as riders for electric energy-efficiency investments, power procurement and transmission services, renewable energy credit compliance, zero emission credits, certain environmental costs, and bad debt write-offs, among others. The actual revenue requirement for a particular year would incorporate Ameren Illinois’ year-end rate base and actual capital structure for such year, provided that the common equity ratio in such capital structure may not exceed that approved by the ICC in the MYRP. Additionally, the ROE approved by the ICC in the MYRP would be subject to annual adjustments during the four-year period based on certain performance metrics relating to delivery system reliability, supplier diversity, affordability of customer delivery service cost, customer service performance, timeliness of response to customer requests for interconnection of distributed energy resources, and reductions in peak load due to demand response programs, with aggregate symmetrical performance-based ROE incentives and penalties ranging from 20 to 60 basis points annually. Excluding potential phase-in of the initial rate increase discussed below, if a lower percentagegiven year’s revenue requirement varies from the amount collected from customers, an adjustment would be made to electric operating revenues with an offset to a regulatory asset or liability to reflect that year’s actual revenue requirement, independent of common equity usedactual sales volumes. The regulatory balance would then be collected from, or refunded to, customers within two years from the end of the applicable annual period.
Under an MYRP, the CEJA permits any initial rate increase to be phased in, with at least 50% of the first annual period’s approved rate increase reflected in rates in the capital structure than requested byfirst annual period, with the remaining portion deferred as a regulatory asset and collected from customers over a period not to exceed two years beginning within one year after the second annual period’s rates are effective. Ameren Illinois partially offsetrecognizes revenues when amounts are expected to be collected from customers within two years from the end of an applicable year.
The CEJA contains other provisions in addition to the ratemaking impacts discussed above. The law permits Ameren Illinois to invest up to $20 million in each of 2 solar generation and battery storage pilot projects in Illinois. Additionally, the law increases the existing customer surcharge for renewable energy resources, which funds IPA renewable energy credit procurement events. As a result, Ameren Illinois expects additional annual revenues of approximately $100 million to be collected under the rider for renewable energy credit compliance. It also establishes an Energy Transition Assistance Fund to support economic and workforce development programs designed to assist the state of Illinois with its transition to clean energy sources. The fund will be subsidized through customer surcharges collected by electric utilities operating in the state, including Ameren Illinois, and will be remitted in the month following collection to an Illinois state agency. Ameren Illinois expects to collect up to $50 million annually related to this fund. The CEJA also requires Ameren Illinois to file a multi-year integrated grid plan with the ICC to ensure electric distribution infrastructure investments align with the state of Illinois’ renewable energy, climate, and environmental goals, and to support grid modernization, clean energy, and energy efficiency, while providing electric distribution service to customers at affordable rates, among other things. The first multi-year integrated grid plan is required to be filed by mid-January 2023, with the next filing required by mid-January 2026, and every four years thereafter.
See Note 9 – Commitments and Contingencies for additional information on emission standards established by the recoveryCEJA that will limit the operations of an expenseAmeren Missouri’s natural gas-fired energy centers located in 2022 rates that Ameren Illinois had requested to recover over five years. An ICC decision in this proceeding is expected by December 2021, with new rates effective January 2022.the state of Illinois.
Electric Distribution Service Rate Reconciliation Tariff
In March 2021, the ICC issued an order approving Ameren Illinois’ requested tariff to reconcile its electric distribution service revenue requirement once Ameren Illinois ceases to update customer rates under performance-based formula ratemaking. The last update under such ratemaking is anticipated to be for 2023 customer rates. The tariff would allow Ameren Illinois to reconcile its revenue requirement for up to two annual periods in which customer rates had been established but not yet reconciled, under the performance-based formula ratemaking framework.for 2022 and 2023. To utilize the reconciliation, Ameren Illinois is required to file a request to update its electric distribution service rates through either a traditional regulatory rate review, which may be based on a future test year and would reflect a proposed ROE subject to ICC approval. Thatapproval, or through the filing of an MYRP, which Ameren Illinois expects to file for rates effective beginning in 2024 pursuant to the CEJA as described above. Based on AIC’s anticipated last year setting rates under IEIMA performance-based formula ratemaking, the rate update request would need to be filed by the end of March in the year following the last year in which Ameren Illinois opted to set annual rates via the performance-based formula ratemaking framework. Ameren Illinois would be required to file that request no later than Marchmid-January 2023. Pursuant to the order, and without legislative change or Ameren Illinois’ election to opt out of performance-based formula ratemaking, Ameren Illinois’ 2022 and 2023 revenues would reflect each year’s actual recoverable costs, year-end rate base, and a return at the applicable WACC, with the ROE component based on the annual average of the monthly yields of the 30-year United States Treasury bonds plus 580 basis points. The revenue requirement reconciliation adjustment would be collected from, or refunded to, customers within two years from the end of the reconciled year.
Electric Distribution Service Rates Under IEIMA
In April 2021, Ameren Illinois filed its annual electric distribution service performance-based formula rate update to be used for 2022 rates with the ICC. In August 2021, Ameren Illinois filed a revised request seeking to increase its annual revenues for electric distribution service by $59 million. This update reflects an increase to the annual performance-based formula rate based on 2020 actual recoverable costs and expected net plant additions for 2021, an increase to include the 2020 revenue requirement reconciliation adjustment including a capital structure composed of 51% common equity, and an increase for the conclusion of the 2019 revenue requirement reconciliation adjustment, which will be fully refunded to customers in 2021, consistent with the ICC’s December 2020 annual update filing order. In August 2021, the ICC staff submitted its calculation of the revenue requirement included in Ameren Illinois’ update filing, recommending an amount comparable to Ameren Illinois’ filing. An ICC decision in this proceeding is required by December 2021, with new rates effective in January 2022.Electric Customer Energy-Efficiency Investments
In May 2021, Ameren Illinois filed its annual electric customer energy-efficiency formula rate update to be used for 2022 rates with the ICC. In September 2021, Ameren Illinois filed a revised request to increase its rates by $11$10 million, withwhich is comparable to a calculation submitted by the ICC.ICC staff in August 2021. An ICC decision in this proceeding is expectedrequired by December 2021, with new rates effective in January 2022.
In July 2021, the ICC issued an order approving Ameren Illinois’ energy-efficiency plan that includes annual investments in electric energy-efficiency programs up toof approximately $100 million per year from 2022 through 2025. Pursuant to the CEJA, the annual investments in electric energy-efficiency programs may increase by approximately $10 million to $40 million, with the increase depending on the election of certain customers to participate in the programs. Those customers have until late January 2022 to decide if they will participate in the four-year programs. The ICC has the ability to reduce the amount of electric energy-efficiency savings goals in future plan program years if there are insufficient cost-effective programs available, which could reduce the investments in electric energy-efficiency programs. The electric
energy-efficiency program investments and the return on those investments are collected from customers through a rider and are not recovered through the electric distribution service performance-based formula ratemaking framework.
QIP Reconciliation OrderHearings
In March 2021, the ICC issued an order approving Ameren Illinois’ QIP reconciliation for 2018. The ICC also found that Ameren Illinois’ natural gas capital investments recovered under the QIP during 2018 were accurate and prudent. The ICC order effectively dismissed the Illinois Attorney General’s office challenge with respect to 2018 capital investments.
In March 2020, Ameren Illinois filed a request with the ICC for a reconciliation hearing to determine the accuracy and prudence of natural gas capital investments recovered under the QIP rider during 2019. In August 2021, the Illinois Attorney General’s office challenged the recovery of capital investments that were made during 2019, alleging that the ICC should disallow approximately $70 million in natural gas capital investments as improper and imprudent, providing a potential over-recovery of approximately $3 million in 2019. In August 2021, the ICC staff filed testimony that supports the prudence and reasonableness of the capital investments made during 2019. Ameren Illinois’ 2019 QIP rate recovery request under review by the ICC is within the rate increase limitations allowed by law. The ICC is under no deadline to issue an order in this proceeding.
Service Disconnection Moratorium
From March 2020 through March 2021, the ICC limited disconnection activities and late fees for customer nonpayment to varying degrees based on customer class. In March 2021, the ICC issued an order allowing Ameren Illinois to resume disconnection activities for all residential customers through a phased-in approach, which began in April 2021 for customers with the largest past due balances and in June 2021 for all remaining residential customers. The March 2021 order also required Ameren Illinois to offer deferred payment arrangements extending to 18 months to all residential customers through June 2021. In addition, the order requires Ameren Illinois to extend the financial assistance program established by a June 2020 ICC order through 2021. Ameren Illinois is allowed to recover up to $4 million in costs incurred during 2021 related to this financial assistance program. These costs will be deferred as regulatory assets and the portion associated with Ameren Illinois’ electric distribution business will be recovered through its bad debt rider and the portion associated with its natural gas distribution business will be recovered through a special purpose rider.
Federal
Transmission Formula Rate Revisions
In February 2020, the MISO, on behalf of Ameren Missouri, Ameren Illinois, and ATXI, filed requests with the FERC to revise each company’s transmission formula rate calculations with respect to the calculation used for materials and supplies inventories included in rate base. In May 2020, the FERC issued orders approving the revisions prospectively. In addition, the FERC declined to order refunds for earlier periods, as requested by intervenors in Ameren Illinois’ filing, but directed its audit staff to review historical rate recovery in connection with an ongoing FERC audit. In June 2020, Ameren Missouri, Ameren Illinois, and ATXI filed requests for rehearing arguing, among other things, the revisions should be applied retrospectively to include the period January 1, 2019, to June 1, 2020, and that the FERC should not require refunds for periods prior to 2019. In July 2020, the FERC denied the rehearing requests without addressing the issues raised. In July 2020, Ameren Missouri, Ameren Illinois, and ATXI filed an appeal of the July 2020 rehearing denials to the United States Court of Appeals for the District of Columbia Circuit, which is under no deadline to address the appeal. In October 2020, the FERC issued an order reaffirming its May 2020 order and denying the arguments raised in the rehearing requests filed by Ameren Missouri, Ameren Illinois, and ATXI. Regardless of the outcome of the appeal, the impacts of the May 2020 and October 2020 orders are not expected to be material to Ameren’s, Ameren Missouri’s, or Ameren Illinois’ results of operations, financial position, or liquidity.
In March 2021, the FERC issued an order related to an intervenor challenge to Ameren Illinois’ 2020 transmission formula rate update. As a result of this order, in March 2021, Ameren Illinois recorded a regulatory liability of $9 million, largely as a reduction of electric operating revenues, to reflect expected refunds, including interest, primarily related to the historical rate recovery of materials and supplies inventories included in rate base. In April 2021, Ameren Illinois filed a request for rehearing with the FERC regarding its March 2021 order. In May 2021, the FERC denied the rehearing request without addressing the issues raised, and indicated it will address them in a future order. The FERC is under no deadline to issue an order, nor is it required to address the issues raised in the rehearing request. In July 2021, Ameren Illinois filed an appeal of the March 2021 order and the May 2021 rehearing denial to the United States Court of Appeals for the District of Columbia Circuit, which is under no deadline to address the appeal.
FERC Complaint Cases
In November 2013, a customer group filed a complaint case with the FERC seeking a reduction in the allowed base ROE for FERC-regulated transmission rate base under the MISO tariff from 12.38% to 9.15%. In September 2016, the FERC issued an order in the
November 2013 complaint case, which lowered the allowed base ROE to 10.32%, or a 10.82% total allowed ROE with the inclusion of a 50
basis point incentive adder for participation in an RTO, that was effective from late September 2016 forward. The September 2016 order also required refunds for the period November 2013 to February 2015, which were paid in 2017. In November 2019, the FERC issued an order addressing the November 2013 complaint case, which set the allowed base ROE at 9.88%, superseding the 10.32% previously ordered, and required refunds, with interest, for the periods November 2013 to February 2015 and from late September 2016 forward. In December 2019, the MISO transmission owners, including Ameren Missouri, Ameren Illinois, and ATXI, filed requests for rehearing with the FERC. In May 2020, the FERC issued an order addressing the requests for rehearing, which set the allowed base ROE at 10.02%, superseding the 9.88% previously ordered, and required refunds, with interest, for the periods November 2013 to February 2015 and from late September 2016 forward. In June 2020, various parties filed requests for rehearing with the FERC, challenging the new ROE methodology established by the May 2020 order. In July 2020, the FERC denied the rehearing requests without addressing the issues raised, and indicated it will address the requests for rehearing in a future order. Also in July 2020, Ameren Missouri, Ameren Illinois, and ATXI filed an appeal of the May 2020 order to the United States Court of Appeals for the District of Columbia Circuit challenging the refunds required for the period from September 2016 to May 2020. The court is under no deadline to address the appeal.
As of JuneSeptember 30, 2021, Ameren and Ameren Illinois had recorded current regulatory liabilities of $16 million and $8 million, respectively, to reflectsubstantially paid the expected refunds, including interest, associated with the allowed base ROE set by the May 2020 order in the November 2013 complaint case. The increase in the FERC-allowed base ROE resulting from the May 2020 order was not material to Ameren Missouri’s results of operations, financial position, or liquidity.
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, and, in the case of Ameren Missouri and Ameren Illinois, short-term affiliate borrowings. See Note 4 – Short-term Debt and Liquidity under Part II, Item 8, in the Form 10-K for a description of our indebtedness provisions and other covenants as well as a description of money pool arrangements.
Short-term Borrowings
The Missouri Credit Agreement and the Illinois Credit Agreement are available to support issuances under Ameren (parent)’s, Ameren Missouri’s, and Ameren Illinois’ commercial paper programs, respectively, subject to borrowing sublimits, and the issuance of letters of credit. As of JuneSeptember 30, 2021, based on commercial paper outstanding and letters of credit issued under the Credit Agreements, along with cash and cash equivalents, the net liquidity available to Ameren (parent), Ameren Missouri, and Ameren Illinois, collectively, was $2.0$1.8 billion. The Ameren Companies were in compliance with the covenants in their Credit Agreements as of JuneSeptember 30, 2021. As of JuneSeptember 30, 2021, the ratios of consolidated indebtedness to consolidated total capitalization, calculated in accordance with the provisions of the Credit Agreements, were 57%, 49%48%, and 46%45% for Ameren, Ameren Missouri, and Ameren Illinois, respectively.
As of JuneSeptember 30, 2021, and December 31, 2020, Ameren (parent)’s commercial paper outstanding, net of issuance discounts, was $431$553 million and $490 million, respectively. There were no borrowings outstanding under the Credit Agreements as of JuneSeptember 30, 2021, or December 31, 2020.
The following table summarizes the activity and relevant interest rates for Ameren (parent)’s, Ameren Missouri’s, and Ameren Illinois’ commercial paper issuances and borrowings under the Credit Agreements in the aggregate for the sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Ameren
(parent) | | Ameren
Missouri | | Ameren
Illinois | | Ameren
Consolidated | | | Ameren
(parent) | | Ameren
Missouri | | Ameren
Illinois | | Ameren
Consolidated | |
| 2021 | 2021 | | 2021 | |
| Average daily amount outstanding | Average daily amount outstanding | | $ | 388 | | | $ | 183 | | | $ | 211 | | | $ | 782 | | | Average daily amount outstanding | | $ | 404 | | | $ | 121 | | | $ | 140 | | | $ | 665 | | |
| | Weighted-average interest rate | Weighted-average interest rate | | 0.24 | % | | 0.22 | % | | 0.22 | % | | 0.23 | % | | Weighted-average interest rate | | 0.23 | % | | 0.22 | % | | 0.22 | % | | 0.22 | % | |
Peak amount outstanding during period(a) | Peak amount outstanding during period(a) | | $ | 650 | | | $ | 546 | | | $ | 485 | | | $ | 1,134 | | | Peak amount outstanding during period(a) | | $ | 650 | | | $ | 546 | | | $ | 485 | | | $ | 1,134 | | |
| Peak interest rate | Peak interest rate | | 0.33 | % | | 0.25 | % | | 0.25 | % | | 0.33 | % | | Peak interest rate | | 0.33 | % | | 0.25 | % | | 0.25 | % | | 0.33 | % | |
| 2020 | 2020 | | 2020 | |
| Average daily amount outstanding | Average daily amount outstanding | | $ | 93 | | | $ | 202 | | | $ | 40 | | | $ | 335 | | | Average daily amount outstanding | | $ | 62 | | | $ | 142 | | | $ | 53 | | | $ | 257 | | |
| | Weighted-average interest rate | Weighted-average interest rate | | 2.05 | % | | 1.86 | % | | 1.98 | % | | 1.92 | % | | Weighted-average interest rate | | 2.04 | % | | 1.76 | % | | 1.10 | % | | 1.70 | % | |
Peak amount outstanding during period(a) | Peak amount outstanding during period(a) | | $ | 425 | | | $ | 573 | | | $ | 150 | | | $ | 908 | | | Peak amount outstanding during period(a) | | $ | 425 | | | $ | 573 | | | $ | 243 | | | $ | 908 | | |
| Peak interest rate | Peak interest rate | | 3.30 | % | | 5.05 | % | (b) | 3.40 | % | | 5.05 | % | (b) | Peak interest rate | | 3.30 | % | | 5.05 | % | (b) | 3.40 | % | | 5.05 | % | (b) |
(a)The timing of peak outstanding commercial paper issuances and borrowings under the Credit Agreements varies by company. Therefore, the sum of individual company peak amounts may not equal the Ameren consolidated peak for the period.
(b)Ameren’s and Ameren Missouri’s peak interest rate was affected by temporary disruptions in the commercial paper market in the first quarter of 2020.
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. The average interest rate for borrowings under the utility money pool for the three and sixnine months ended JuneSeptember 30, 2021, was 0.22%0.06% and 0.22%0.17%, respectively (2020 – 0.42%0.10% and 1.18%0.81%, respectively). See Note 8 – Related-party Transactions for the amount of interest income and expense from the utility money pool arrangements recorded by Ameren Missouri and Ameren Illinois for the three and sixnine months ended JuneSeptember 30, 2021 and 2020.
NOTE 4 – LONG-TERM DEBT AND EQUITY FINANCINGS
Ameren
For the three and sixnine months ended JuneSeptember 30, 2021, Ameren issued a total of 0.20.1 million and 0.30.4 million shares of common stock, respectively, under its DRPlus and 401(k) plan, and received proceeds of $12 million and $24$36 million, respectively. In addition, in the first quarter of 2021, Ameren issued 0.5 million shares of common stock valued at $33 million upon the vestingsettlement of stock-based compensation.compensation awards.
In February 2021, Ameren settled the remainder of thea forward sale agreement that was entered into in August 2019, by physically delivering 1.6 million shares of common stock for cash proceeds of $113 million. The proceeds were used to fund a portion of Ameren Missouri’s wind generation investments. See Note 2 – Rate and Regulatory Matters in this report and under Part II, Item 8, in the Form 10-K for additional information about the wind generation investments.
In May 2021, Ameren entered into an equity distribution sales agreement pursuant to which Ameren may offer and sell from time to time up to $750 million of its common stock through an ATM program, which includes the ability to enter into forward sales agreements. For the sixthree and nine months ended JuneSeptember 30, 2021, Ameren issued 1.40.4 million and 1.8 million shares of common stock, respectively, and received proceeds of $121$27 million and $148 million, respectively. These proceeds were net of less than $1 million and $2 million in compensation paid to selling agents.agents for the three and nine months ended September 30, 2021, respectively. In September 2021, Ameren entered into a forward sale agreement under the ATM program with a counterparty relating to 0.4 million shares of common stock. The forward sale agreement can be settled at Ameren’s discretion on or prior to May 3, 2023. On a settlement date or dates, if Ameren elects to physically settle the forward sale agreement, Ameren will issue shares of common stock to the counterparty at the then-applicable forward sale price. The forward sale price was initially $87.87 per share. The forward sale agreement will be physically settled unless Ameren elects to settle in cash or to net share settle. At September 30, 2021, Ameren could have settled the forward sale agreement with physical delivery of 0.4 million shares of common stock to the counterparty in exchange for cash of $31 million. The forward sale agreement has been classified as an equity transaction.
In March 2021, Ameren (parent) issued $450 million of 1.75% senior unsecured notes due March 2028, with interest payable semiannually on March 15 and September 15 of each year, beginning September 15, 2021. Ameren received net proceeds of $447 million, which were used for general corporate purposes, including the repayment of short-term debt.
Ameren Missouri
In June 2021, Ameren Missouri issued $525 million of 2.15% first mortgage bonds due March 2032, with interest payable semiannually on March 15 and September 15 of each year, beginning March 15, 2022. Ameren Missouri received net proceeds of $521 million, which are expected to bewere used to repay short-term debt and for near-term capital expenditures. Ameren Missouri intends to allocate an amount equal to the net proceeds to sustainability projects meeting certain eligibility criteria.
Ameren Missouri received capital contributions totaling $183 million from Ameren (parent) during the sixnine months ended JuneSeptember 30, 2021.
Ameren Illinois
In March 2021, Ameren Illinois redeemed its 6.625% and 7.75% series preferred stock at par for $12 million and $1 million, respectively. The preferred stock of Ameren Illinois is reflected in “Noncontrolling Interests” on Ameren’s consolidated balance sheet.
In June 2021, Ameren Illinois issued $350 million of 2.90% first mortgage bonds due June 2051, with interest payable semiannually on June 15 and December 15 of each year, beginning December 15, 2021. Ameren Illinois received net proceeds of $345 million, which are expected to bewere used to repay short-term debt. Ameren Illinois intends to allocate an amount equal to the net proceeds to sustainability projects meeting certain eligibility criteria.
In June 2021, Ameren Illinois issued $100 million of 0.375% first mortgage bonds due June 2023, with interest payable semiannually on June 15 and December 15 of each year, beginning December 15, 2021. Ameren Illinois received net proceeds of $100 million, which are expected to bewere used to repay short-term debt.
Ameren Illinois received capital contributions totaling $70$145 million from Ameren (parent) during the sixnine months ended JuneSeptember 30, 2021.
Indenture Provisions and Other Covenants
See Note 5 – Long-term Debt and Equity Financings under Part II, Item 8, in the Form 10-K for a description of our indenture provisions and other covenants, as well as restrictions on the payment of dividends. At JuneSeptember 30, 2021, the Ameren Companies were in compliance with the provisions and covenants contained in their indentures and articles of incorporation, as applicable, and ATXI was in compliance with the provisions and covenants contained in its note purchase agreement.
Off-balance-sheet Arrangements
At JuneSeptember 30, 2021, none of the Ameren Companies had any significant off-balance-sheet financing arrangements, other than variable interest entities.entities and the September 2021 forward sale agreement relating to common stock. See Note 1 – Summary of Significant Accounting Policies for further detail concerning variable interest entities.
NOTE 5 – OTHER INCOME, NET
The following table presents the components of “Other Income, Net” in the Ameren Companies’ statements of income for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Three Months | | Six Months | | | Three Months | | Nine Months | |
| | 2021 | | 2020 | | 2021 | | 2020 | | | 2021 | | 2020 | | 2021 | | 2020 | |
| Ameren: | Ameren: | | Ameren: | |
| | Allowance for equity funds used during construction | Allowance for equity funds used during construction | $ | 9 | | | $ | 9 | | | $ | 16 | | | $ | 13 | | | Allowance for equity funds used during construction | $ | 14 | | | $ | 12 | | | $ | 30 | | | $ | 25 | | |
| Interest income on industrial development revenue bonds | Interest income on industrial development revenue bonds | 6 | | | 6 | | | 12 | | | 12 | | | Interest income on industrial development revenue bonds | 7 | | | 7 | | | 19 | | | 19 | | |
| Other interest income | Other interest income | 0 | | | 1 | | | 1 | | | 2 | | | Other interest income | — | | | — | | | 1 | | | 2 | | |
| Non-service cost components of net periodic benefit income(a) | Non-service cost components of net periodic benefit income(a) | 34 | | | 30 | | | 68 | | | 53 | | | Non-service cost components of net periodic benefit income(a) | 34 | | | 32 | | | 102 | | | 85 | | |
| Miscellaneous income | Miscellaneous income | 7 | | | 7 | | | 11 | | | 9 | | | Miscellaneous income | 3 | | | 1 | | | 14 | | | 10 | | |
| Donations | Donations | (1) | | | (1) | | | (4) | | | (14) | | (b) | Donations | (1) | | | — | | | (5) | | | (14) | | (b) |
| Miscellaneous expense | Miscellaneous expense | (6) | | | (4) | | | (9) | | | (6) | | | Miscellaneous expense | (1) | | | (4) | | | (10) | | | (10) | | |
| Total Other Income, Net | Total Other Income, Net | $ | 49 | | | $ | 48 | | | $ | 95 | | | $ | 69 | | | Total Other Income, Net | $ | 56 | | | $ | 48 | | | $ | 151 | | | $ | 117 | | |
| Ameren Missouri: | Ameren Missouri: | | Ameren Missouri: | |
| | Allowance for equity funds used during construction | Allowance for equity funds used during construction | $ | 6 | | | $ | 6 | | | $ | 10 | | | $ | 8 | | | Allowance for equity funds used during construction | $ | 7 | | | $ | 7 | | | $ | 17 | | | $ | 15 | | |
| Interest income on industrial development revenue bonds | Interest income on industrial development revenue bonds | 6 | | | 7 | | | 12 | | | 12 | | | Interest income on industrial development revenue bonds | 7 | | | 7 | | | 19 | | | 19 | | |
| Non-service cost components of net periodic benefit income(a) | Non-service cost components of net periodic benefit income(a) | 14 | | | 14 | | | 28 | | | 19 | | | Non-service cost components of net periodic benefit income(a) | 13 | | | 13 | | | 41 | | | 32 | | |
| Miscellaneous income | Miscellaneous income | 0 | | | 1 | | | 1 | | | 2 | | | Miscellaneous income | 2 | | | 1 | | | 3 | | | 3 | | |
| Donations | Donations | (1) | | | (1) | | | (1) | | | (9) | | (b) | Donations | — | | | — | | | (1) | | | (9) | | (b) |
| Miscellaneous expense | Miscellaneous expense | (1) | | | (2) | | | (3) | | | (3) | | | Miscellaneous expense | (2) | | | (2) | | | (5) | | | (5) | | |
| Total Other Income, Net | Total Other Income, Net | $ | 24 | | | $ | 25 | | | $ | 47 | | | $ | 29 | | | Total Other Income, Net | $ | 27 | | | $ | 26 | | | $ | 74 | | | $ | 55 | | |
| Ameren Illinois: | Ameren Illinois: | | Ameren Illinois: | |
| | Allowance for equity funds used during construction | Allowance for equity funds used during construction | $ | 3 | | | $ | 3 | | | $ | 6 | | | $ | 5 | | | Allowance for equity funds used during construction | $ | 7 | | | $ | 5 | | | $ | 13 | | | $ | 10 | | |
| Interest income | Interest income | 0 | | | 1 | | | 1 | | | 2 | | | Interest income | — | | | — | | | 1 | | | 2 | | |
| | Non-service cost components of net periodic benefit income | Non-service cost components of net periodic benefit income | 14 | | | 11 | | | 28 | | | 24 | | | Non-service cost components of net periodic benefit income | 13 | | | 12 | | | 41 | | | 36 | | |
| Miscellaneous income | Miscellaneous income | 3 | | | 4 | | | 3 | | | 5 | | | Miscellaneous income | — | | | 1 | | | 3 | | | 6 | | |
| Donations | Donations | 0 | | | (1) | | | (3) | | | (5) | | | Donations | (1) | | | — | | | (4) | | | (5) | | |
| Miscellaneous expense | Miscellaneous expense | (4) | | | (1) | | | (5) | | | (3) | | | Miscellaneous expense | — | | | (1) | | | (5) | | | (4) | | |
| Total Other Income, Net | Total Other Income, Net | $ | 16 | | | $ | 17 | | | $ | 30 | | | $ | 28 | | | Total Other Income, Net | $ | 19 | | | $ | 17 | | | $ | 49 | | | $ | 45 | | |
(a)For the three and sixnine months ended JuneSeptember 30, 2021, the non-service cost components of net periodic benefit income were adjusted by amounts deferred of $(3) million in both periods,and $(6) million, respectively, due to a regulatory tracking mechanism for the difference between the level of such costs incurred by Ameren Missouri under GAAP and the level of such costs included in rates. The deferral was $(3) million and $3less than $(1) million for the three and sixnine months ended JuneSeptember 30, 2020.
(b)Includes $8 million pursuant to Ameren Missouri’s March 2020 electric rate order. See Note 2 – Rate and Regulatory Matters under Part II, Item 8, in the Form 10-K for additional information.
NOTE 6 – DERIVATIVE FINANCIAL INSTRUMENTS
We use derivatives to manage the risk of changes in market prices for natural gas, power, and power,uranium, as well as the risk of changes in rail transportation surcharges through fuel oil hedges. Such price fluctuations may cause the following:
•an unrealized appreciation or depreciation of our contracted commitments to purchase or sell when purchase or sale prices under the commitments are compared with current commodity prices;
•market values of natural gas and uranium inventories that differ from the cost of those commodities in inventory;
•actual cash outlays for the purchase of these commodities that differ from anticipated cash outlays; and
•actual off-system sales revenues that differ from anticipated revenues.
The derivatives that we use to hedge these risks are governed by our risk management policies for forward contracts, futures, options, and swaps. Our net positions are continually assessed within our structured hedging programs to determine whether new or offsetting transactions are required. The goal of the hedging program is generally to mitigate financial risks while ensuring that sufficient volumes are available to meet our requirements. Contracts we enter into as part of our risk management program may be settled financially, settled by physical delivery, or net settled with the counterparty.
All contracts considered to be derivative instruments are required to be recorded on the balance sheet at their fair values, unless the NPNS exception applies. Many of our physical contracts, such as our purchased power contracts, qualify for the NPNS exception to derivative accounting rules. The revenue or expense on NPNS contracts is recognized at the contract price upon physical delivery. The following disclosures exclude NPNS contracts and other non-derivative commodity contracts that are accounted for under the accrual method of accounting.
If we determine that a contract meets the definition of a derivative and is not eligible for the NPNS exception, we review the contract to determine whether the resulting gains or losses qualify for regulatory deferral. Derivative contracts that qualify for regulatory deferral are recorded at fair value, with changes in fair value recorded as regulatory assets or liabilities in the period in which the change occurs. We believe derivative losses and gains deferred as regulatory assets and liabilities are probable of recovery, or refund, through future rates charged to customers. Regulatory assets and liabilities are amortized to operating income as related losses and gains are reflected in rates charged to customers. Therefore, gains and losses on these derivatives have no effect on operating income. As of JuneSeptember 30, 2021, and December 31, 2020, all contracts that met the definition of a derivative and were not eligible for the NPNS exception received regulatory deferral. Cash flows for all derivative financial instruments are classified in cash flows from operating activities.
The following table presents open gross commodity contract volumes by commodity type for derivative assets and liabilities as of JuneSeptember 30, 2021, and December 31, 2020. As of JuneSeptember 30, 2021, these contracts extended through October 2023,2024, October 2026, and May 2032 and March 2023 for fuel oils, natural gas, power and power,uranium, respectively.
| | | Quantity (in millions) | | Quantity (in millions) |
| | June 30, 2021 | December 31, 2020 | | September 30, 2021 | December 31, 2020 |
| Commodity | Commodity | Ameren Missouri | Ameren Illinois | Ameren | Ameren Missouri | Ameren Illinois | Ameren | Commodity | Ameren Missouri | Ameren Illinois | Ameren | Ameren Missouri | Ameren Illinois | Ameren |
| Fuel oils (in gallons) | Fuel oils (in gallons) | 30 | | 0 | | 30 | | 43 | | 0 | | 43 | | Fuel oils (in gallons) | 28 | | — | | 28 | | 43 | | — | | 43 | |
| Natural gas (in mmbtu) | Natural gas (in mmbtu) | 33 | | 118 | | 151 | | 33 | | 114 | | 147 | | Natural gas (in mmbtu) | 33 | | 136 | | 169 | | 33 | | 114 | | 147 | |
| Power (in MWhs) | Power (in MWhs) | 6 | | 7 | | 13 | | 6 | | 7 | | 13 | | Power (in MWhs) | 6 | | 6 | | 12 | | 6 | | 7 | | 13 | |
| | Uranium (pounds in thousands) | | Uranium (pounds in thousands) | 400 | | — | | 400 | | 365 | | — | | 365 | |
The following table presents the carrying value and balance sheet location of all derivative commodity contracts, none of which were designated as hedging instruments, as of JuneSeptember 30, 2021, and December 31, 2020:
| | | | | June 30, 2021 | December 31, 2020 | | | | September 30, 2021 | December 31, 2020 |
| | Balance Sheet Location | | | Ameren
Missouri | | Ameren
Illinois | | Ameren | | | | Ameren
Missouri | | Ameren
Illinois | | Ameren | | Balance Sheet Location | | | Ameren
Missouri | | Ameren
Illinois | | Ameren | | | | Ameren
Missouri | | Ameren
Illinois | | Ameren |
| | | | | Fuel oils | Fuel oils | Other current assets | | $ | 7 | | | $ | 0 | | | $ | 7 | | | | $ | 2 | | | $ | 0 | | | $ | 2 | | Fuel oils | Other current assets | | $ | 9 | | | $ | — | | | $ | 9 | | | | $ | 2 | | | $ | — | | | $ | 2 | |
| | Other assets | | | 5 | | | 0 | | | 5 | | | | | 0 | | | 0 | | | 0 | | | Other assets | | | 5 | | | — | | | 5 | | | | | — | | | — | | | — | |
| | Natural gas | Natural gas | Other current assets | | | 7 | | | 26 | | | 33 | | | | | 1 | | | 8 | | | 9 | | Natural gas | Mark-to-market derivative assets | | | (a) | | 55 | | | (a) | | | | (a) | | 8 | | | (a) |
| | Other assets | | | 3 | | | 10 | | | 13 | | | | | 2 | | | 2 | | | 4 | | |
| | | Other current assets | | | 13 | | | — | | | 68 | | | | | 1 | | | — | | | 9 | |
| | | Other assets | | | 8 | | | 20 | | | 28 | | | | | 2 | | | 2 | | | 4 | |
| Power | Power | Other current assets | | | 15 | | | 0 | | | 15 | | | | | 7 | | | 0 | | | 7 | | Power | Mark-to-market derivative assets | | | (a) | | 1 | | | (a) | | | | (a) | | — | | | (a) |
| | Other assets | | | 1 | | | 0 | | | 1 | | | | | 0 | | | 0 | | | 0 | | |
| | | Other current assets | | | 31 | | | — | | | 32 | | | | | 7 | | | — | | | 7 | |
| | | Other assets | | | 1 | | | — | | | 1 | | | | | — | | | — | | | — | |
| | Total assets | | $ | 38 | | | $ | 36 | | | $ | 74 | | | | $ | 12 | | | $ | 10 | | | $ | 22 | | |
| | Uranium | | Uranium | Other assets | | | 2 | | | — | | | 2 | | | | | — | | | — | | | — | |
| | | Total assets | | $ | 69 | | | $ | 76 | | | $ | 145 | | | | $ | 12 | | | $ | 10 | | | $ | 22 | |
| | | Fuel oils | Fuel oils | Other current liabilities | | $ | 1 | | | $ | 0 | | | $ | 1 | | | | $ | 7 | | | $ | 0 | | | $ | 7 | | Fuel oils | Mark-to-market derivative liabilities | | $ | — | | | $ | (a) | | $ | (a) | | | $ | 7 | | | $ | (a) | | $ | (a) |
| | Other deferred credits and liabilities | | | 0 | | | 0 | | | 0 | | | | | 2 | | | 0 | | | 2 | | |
| | | Other current liabilities | | | — | | | — | | | — | | | | | — | | | — | | | 7 | |
| | | Other deferred credits and liabilities | | | — | | | — | | | — | | | | | 2 | | | — | | | 2 | |
| | Natural gas | Natural gas | Other current liabilities | | | 0 | | | 1 | | | 1 | | | | | 1 | | | 1 | | | 2 | | Natural gas | Other current liabilities | | | — | | | 4 | | | 4 | | | | | 1 | | | 1 | | | 2 | |
| | | Other deferred credits and liabilities | | | — | | | 2 | | | 2 | | | | | — | | | 1 | | | 1 | |
| Power | | Power | Mark-to-market derivative liabilities | | | 75 | | | (a) | | (a) | | | | 3 | | | (a) | | (a) |
| | Other deferred credits and liabilities | | | 0 | | | 0 | | | 0 | | | | | 0 | | | 1 | | | 1 | | |
| | | Other current liabilities | | | — | | | 5 | | | 80 | | | | | — | | | 17 | | | 20 | |
| | | Other deferred credits and liabilities | | | 22 | | | 140 | | | 162 | | | | | 8 | | | 181 | | | 189 | |
| Power | Other current liabilities | | | 27 | | | 12 | | | 39 | | | | | 3 | | | 17 | | | 20 | | |
| | Uranium | | Uranium | Other current liabilities | | | 1 | | | — | | | 1 | | | | | — | | | — | | | — | |
| | Other deferred credits and liabilities | | | 17 | | | 154 | | | 171 | | | | | 8 | | | 181 | | | 189 | | |
| | | Total liabilities | | $ | 98 | | | $ | 151 | | | $ | 249 | | | | $ | 21 | | | $ | 200 | | | $ | 221 | |
| | | Total liabilities | | $ | 45 | | | $ | 167 | | | $ | 212 | | | | $ | 21 | | | $ | 200 | | | $ | 221 | | |
| |
The Ameren Companies elect(a)Balance sheet line item not applicable to presentregistrant.
We believe that entering into master netting arrangements or similar agreements mitigates the fair value amountslevel of financial loss that could result from default by allowing net settlement of derivative assets and liabilities. These master netting arrangements allow the counterparties to net settle sale and purchase transactions. Further, collateral requirements are calculated at the master netting arrangement or similar agreement level by counterparty.
The following table provides the recognized gross derivative liabilitiesbalances and the net amounts of those derivatives subject to an enforceable master netting arrangement or similar agreement at the gross amounts on the balance sheet. However, ifas of September 30, 2021. If the gross amounts recognized on the balance sheet were netted with derivative instruments and cash collateral received or posted at December 31, 2020,the net amounts would not be materially different from the gross amounts at June 30, 2021,amounts.
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| | | | Gross Amounts Not Offset in the Balance Sheet | | |
| Commodity Contracts Eligible to be Offset | | Gross Amounts Recognized in the Balance Sheet | | Derivative Instruments | | Cash Collateral Received/Posted(a) | | Net
Amount |
| 2021 | | | | | | | | |
| Assets: | | | | | | | | |
| Ameren Missouri | | $ | 69 | | | $ | 14 | | | $ | 2 | | | $ | 53 | |
| Ameren Illinois | | 76 | | | 2 | | | 3 | | | 71 | |
| Ameren | | $ | 145 | | | $ | 16 | | | $ | 5 | | | $ | 124 | |
| Liabilities: | | | | | | | | |
| Ameren Missouri | | $ | 98 | | | $ | 14 | | | $ | 57 | | | $ | 27 | |
| Ameren Illinois | | 151 | | | 2 | | | — | | | 149 | |
| Ameren | | $ | 249 | | | $ | 16 | | | $ | 57 | | | $ | 176 | |
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(a)Cash collateral received reduces gross asset balances and December 31, 2020.is included in “Other current liabilities” and “Other deferred credits and liabilities” on the balance sheet. Cash collateral posted reduces gross liability balances and is included in “Other current assets” and “Other assets” on the balance sheet.
Credit Risk
In determining our concentrations of credit risk related to derivative instruments, we review our individual counterparties and categorize each counterparty into groupings according to the primary business in which each engages. As of JuneSeptember 30, 2021, if counterparty groups were to fail completely to perform on contracts, Ameren, Ameren Missouri, and Ameren Illinois' maximum exposure related to derivative assets, predominantly from financial institutions, was $61$127 million, $25$51 million, and $36$76 million, respectively. The potential loss on
counterparty exposures may be reduced or eliminated by the application of master netting arrangements or similar agreements and collateral held. As of JuneSeptember 30, 2021, the potential loss after
consideration of the application of master netting arrangements or similar agreements and collateral held for Ameren, Ameren Missouri, and Ameren Illinois was $57$114 million, $21$39 million, and $36$75 million, respectively.
Certain of our derivative instruments contain collateral provisions tied to the Ameren Companies’ credit ratings. If our credit ratings were downgraded below investment grade, or if a counterparty with reasonable grounds for uncertainty regarding our ability to satisfy an obligation requested adequate assurance of performance, additional collateral postings might be required. The additional collateral required is the net liability position allowed under master netting arrangements or similar agreements, assuming (1) the credit risk-related contingent features underlying these arrangements were triggered and (2) those counterparties with rights to do so requested collateral. AsThe following table presents, as of JuneSeptember 30, 2021, the aggregate fair value of all derivative instruments with credit risk-related contingent features in a gross liability position, the cash collateral posted, and the aggregate amount of additional collateral that counterparties could require were each immaterialrequire.
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| | | | | |
| Aggregate Fair Value of Derivative Liabilities(a) | | Cash
Collateral Posted | | Potential Aggregate Amount of Additional Collateral Required(b) |
| Ameren Missouri | $ | 45 | | | $ | 3 | | | $ | 28 | |
| Ameren Illinois | 6 | | | — | | | 4 | |
| | | | | |
| Ameren | $ | 51 | | | $ | 3 | | | $ | 32 | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
| | | | | |
(a)Before consideration of master netting arrangements or similar agreements.
(b)As collateral requirements with certain counterparties are based on master netting arrangements or similar agreements, the aggregate amount of additional collateral required to Ameren, Ameren Missouri, and Ameren Illinois.be posted is determined after consideration of the effects of such arrangements.
NOTE 7 – FAIR VALUE MEASUREMENTS
Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Fair value measurements are classified in three levels based on the fair value hierarchy as defined by GAAP. See Note 8 – Fair Value Measurements under Part II, Item 8, of the Form 10-K for information related to hierarchy levels and valuation techniques.
We consider nonperformance risk in our valuation of derivative instruments by analyzing our own credit standing and the credit standing of our counterparties, and by considering any credit enhancements (e.g., collateral). Included in our valuation, and based on current market conditions, is a valuation adjustment for counterparty default derived from market data such as the price of credit default swaps, bond yields, and credit ratings. No material gains or losses related to valuation adjustments for counterparty default risk were recorded at Ameren, Ameren Missouri, or Ameren Illinois in the three and sixnine months ended JuneSeptember 30, 2021 or 2020. At JuneSeptember 30, 2021, and December 31, 2020, the counterparty default risk valuation adjustment related to derivative contracts was immaterial for Ameren, Ameren Missouri, and Ameren Illinois.
The following table sets forth, by level within the fair value hierarchy, our assets and liabilities measured at fair value on a recurring basis as of JuneSeptember 30, 2021, and December 31, 2020:
| | | June 30, 2021 | | | December 31, 2020 | | | September 30, 2021 | | | December 31, 2020 | |
| | Level 1 | Level 2 | Level 3 | Total | | | Level 1 | Level 2 | Level 3 | Total | | | Level 1 | Level 2 | Level 3 | Total | | | Level 1 | Level 2 | Level 3 | Total | |
| Assets: | Assets: | | | | Assets: | | | |
| Ameren Missouri | Ameren Missouri | | | | Ameren Missouri | | | |
| | Derivative assets – commodity contracts: | | | | | Derivative assets – commodity contracts: | | | |
| | Fuel oils | $ | 11 | | $ | 0 | | $ | 1 | | $ | 12 | | | | $ | 0 | | $ | 0 | | $ | 2 | | $ | 2 | | | | Fuel oils | $ | 14 | | $ | — | | $ | — | | $ | 14 | | | | $ | — | | $ | — | | $ | 2 | | $ | 2 | | |
| | Natural gas | 0 | | 10 | | 0 | | 10 | | | | 0 | | 3 | | 0 | | 3 | | | | Natural gas | — | | 20 | | 1 | | 21 | | | | — | | 3 | | — | | 3 | | |
| | Power | 5 | | 0 | | 11 | | 16 | | | | 2 | | 0 | | 5 | | 7 | | | | Power | 12 | | — | | 20 | | 32 | | | | 2 | | — | | 5 | | 7 | | |
| | | Uranium | — | | — | | 2 | | 2 | | | | — | | — | | — | | — | | |
| | Total derivative assets – commodity contracts | $ | 16 | | $ | 10 | | $ | 12 | | $ | 38 | | | | $ | 2 | | $ | 3 | | $ | 7 | | $ | 12 | | | | Total derivative assets – commodity contracts | $ | 26 | | $ | 20 | | $ | 23 | | $ | 69 | | | | $ | 2 | | $ | 3 | | $ | 7 | | $ | 12 | | |
| | Nuclear decommissioning trust fund: | | | | | Nuclear decommissioning trust fund: | | | |
| | | Equity securities: | | | | | Equity securities: | | | |
| | U.S. large capitalization | $ | 739 | | $ | 0 | | $ | 0 | | $ | 739 | | | | $ | 680 | | $ | 0 | | $ | 0 | | $ | 680 | | | | U.S. large capitalization | $ | 743 | | $ | — | | $ | — | | $ | 743 | | | | $ | 680 | | $ | — | | $ | — | | $ | 680 | | |
| | Debt securities: | | | | | Debt securities: | | | |
| | U.S. Treasury and agency securities | 0 | | 128 | | 0 | | 128 | | | | 0 | | 115 | | 0 | | 115 | | | | U.S. Treasury and agency securities | — | | 141 | | — | | 141 | | | | — | | 115 | | — | | 115 | | |
| | Corporate bonds | 0 | | 131 | | 0 | | 131 | | | | 0 | | 115 | | 0 | | 115 | | | | Corporate bonds | — | | 128 | | — | | 128 | | | | — | | 115 | | — | | 115 | | |
| | | Other | 0 | | 65 | | 0 | | 65 | | | | 0 | | 67 | | 0 | | 67 | | | | Other | — | | 56 | | — | | 56 | | | | — | | 67 | | — | | 67 | | |
| | Total nuclear decommissioning trust fund | $ | 739 | | $ | 324 | | $ | 0 | | $ | 1,063 | | (a) | | $ | 680 | | $ | 297 | | $ | 0 | | $ | 977 | | (a) | | Total nuclear decommissioning trust fund | $ | 743 | | $ | 325 | | $ | — | | $ | 1,068 | | (a) | | $ | 680 | | $ | 297 | | $ | — | | $ | 977 | | (a) |
| | Total Ameren Missouri | $ | 755 | | $ | 334 | | $ | 12 | | $ | 1,101 | | | | $ | 682 | | $ | 300 | | $ | 7 | | $ | 989 | | | | Total Ameren Missouri | $ | 769 | | $ | 345 | | $ | 23 | | $ | 1,137 | | | | $ | 682 | | $ | 300 | | $ | 7 | | $ | 989 | | |
| | | June 30, 2021 | | | December 31, 2020 | | | September 30, 2021 | | | December 31, 2020 | |
| | Level 1 | Level 2 | Level 3 | Total | | | Level 1 | Level 2 | Level 3 | Total | | | Level 1 | Level 2 | Level 3 | Total | | | Level 1 | Level 2 | Level 3 | Total | |
| Ameren Illinois | Ameren Illinois | | | | Ameren Illinois | | | |
| | Derivative assets – commodity contracts: | | | | | Derivative assets – commodity contracts: | | | |
| | Natural gas | $ | 1 | | $ | 27 | | $ | 8 | | $ | 36 | | | | $ | 0 | | $ | 6 | | $ | 4 | | $ | 10 | | | | Natural gas | $ | 3 | | $ | 62 | | $ | 10 | | $ | 75 | | | | $ | — | | $ | 6 | | $ | 4 | | $ | 10 | | |
| | | Power | — | | — | | 1 | | 1 | | | | — | | — | | — | | — | | |
| | | Total Ameren Illinois | $ | 3 | | $ | 62 | | $ | 11 | | $ | 76 | | | | $ | — | | $ | 6 | | $ | 4 | | $ | 10 | | |
| Ameren | Ameren | | | | Ameren | | | |
| | Derivative assets – commodity contracts(b) | $ | 17 | | $ | 37 | | $ | 20 | | $ | 74 | | | | $ | 2 | | $ | 9 | | $ | 11 | | $ | 22 | | | | Derivative assets – commodity contracts(b) | $ | 29 | | $ | 82 | | $ | 34 | | $ | 145 | | | | $ | 2 | | $ | 9 | | $ | 11 | | $ | 22 | | |
| | Nuclear decommissioning trust fund(c) | 739 | | 324 | | 0 | | 1,063 | | (a) | | 680 | | 297 | | 0 | | 977 | | (a) | | Nuclear decommissioning trust fund(c) | 743 | | 325 | | — | | 1,068 | | (a) | | 680 | | 297 | | — | | 977 | | (a) |
| | Total Ameren | $ | 756 | | $ | 361 | | $ | 20 | | $ | 1,137 | | | | $ | 682 | | $ | 306 | | $ | 11 | | $ | 999 | | | | Total Ameren | $ | 772 | | $ | 407 | | $ | 34 | | $ | 1,213 | | | | $ | 682 | | $ | 306 | | $ | 11 | | $ | 999 | | |
| Liabilities: | Liabilities: | | | | Liabilities: | | | |
| Ameren Missouri | Ameren Missouri | | | | Ameren Missouri | | | |
| | Derivative liabilities – commodity contracts: | | | | | Derivative liabilities – commodity contracts: | | | |
| | Fuel oils | $ | 0 | | $ | 0 | | $ | 1 | | $ | 1 | | | | $ | 6 | | $ | 0 | | $ | 3 | | $ | 9 | | | | Fuel oils | $ | — | | $ | — | | $ | — | | $ | — | | | | $ | 6 | | $ | — | | $ | 3 | | $ | 9 | | |
| | Natural gas | 0 | | 0 | | 0 | | 0 | | | | 0 | | 1 | | 0 | | 1 | | | | Natural gas | — | | — | | — | | — | | | | — | | 1 | | — | | 1 | | |
| | Power | 28 | | 0 | | 16 | | 44 | | | | 8 | | 0 | | 3 | | 11 | | | | Power | 54 | | — | | 43 | | 97 | | | | 8 | | — | | 3 | | 11 | | |
| | | Uranium | — | | — | | 1 | | 1 | | | | — | | — | | — | | — | | |
| | Total Ameren Missouri | $ | 28 | | $ | 0 | | $ | 17 | | $ | 45 | | | | $ | 14 | | $ | 1 | | $ | 6 | | $ | 21 | | | | Total Ameren Missouri | $ | 54 | | $ | — | | $ | 44 | | $ | 98 | | | | $ | 14 | | $ | 1 | | $ | 6 | | $ | 21 | | |
| Ameren Illinois | Ameren Illinois | | | | Ameren Illinois | | | |
| | Derivative liabilities – commodity contracts: | | | | | Derivative liabilities – commodity contracts: | | | |
| | Natural gas | $ | 0 | | $ | 1 | | $ | 0 | | $ | 1 | | | | $ | 0 | | $ | 1 | | $ | 1 | | $ | 2 | | | | Natural gas | $ | — | | $ | 2 | | $ | 4 | | $ | 6 | | | | $ | — | | $ | 1 | | $ | 1 | | $ | 2 | | |
| | Power | 0 | | 0 | | 166 | | 166 | | | | 0 | | 0 | | 198 | | 198 | | | | Power | — | | — | | 145 | | 145 | | | | — | | — | | 198 | | 198 | | |
| | Total Ameren Illinois | $ | 0 | | $ | 1 | | $ | 166 | | $ | 167 | | | | $ | 0 | | $ | 1 | | $ | 199 | | $ | 200 | | | | Total Ameren Illinois | $ | — | | $ | 2 | | $ | 149 | | $ | 151 | | | | $ | — | | $ | 1 | | $ | 199 | | $ | 200 | | |
| Ameren | Ameren | | | | Ameren | | | |
| | Derivative liabilities – commodity contracts(b) | $ | 28 | | $ | 1 | | $ | 183 | | $ | 212 | | | | $ | 14 | | $ | 2 | | $ | 205 | | $ | 221 | | | | Derivative liabilities – commodity contracts(b) | $ | 54 | | $ | 2 | | $ | 193 | | $ | 249 | | | | $ | 14 | | $ | 2 | | $ | 205 | | $ | 221 | | |
(a)Balance excludes $7excludes $8 million andand $5 million of cash and cash equivalents, receivables, payables, and accrued income, net, for JuneSeptember 30, 2021, and December 31, 2020, respectively.
(b)See the Ameren Missouri and Ameren Illinois sections of the table for a breakout of the fair value of Ameren’s derivative assets and liabilities by type of commodity.
(c)See the Ameren Missouri section of the table for a breakout of the fair value of Ameren's nuclear decommissioning trust fund by investment type.
Level 3 fuel oils, natural gas, and uranium derivative contract assets and liabilities measured at fair value on a recurring basis were immaterial for all periods presented. The following table presents the fair value reconciliation of Level 3 power derivative contract assets and liabilities measured at fair value on a recurring basis for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2021 | | | 2020 |
| Ameren Missouri | Ameren Illinois | | | Ameren | | | Ameren Missouri | Ameren Illinois | Ameren |
| For the three months ended June 30: | | | | | | | | | | |
| Beginning balance at April 1 | $ | (3) | | $ | (185) | | | | $ | (188) | | | | $ | 17 | | $ | (241) | | $ | (224) | |
| Realized and unrealized gains/(losses) included in regulatory assets/liabilities | (1) | | 15 | | | | 14 | | | | 9 | | 7 | | 16 | |
| | | | | | | | | | |
| | | | | | | | | | |
| Settlements | (1) | | 4 | | | | 3 | | | | (10) | | 5 | | (5) | |
| | | | | | | | | | |
| | | | | | | | | | |
| Ending balance at June 30 | $ | (5) | | $ | (166) | | | | $ | (171) | | | | $ | 16 | | $ | (229) | | $ | (213) | |
| Change in unrealized gains/(losses) related to assets/liabilities held at June 30 | $ | (2) | | $ | 15 | | | | $ | 13 | | | | $ | 8 | | $ | 7 | | $ | 15 | |
| For the six months ended June 30: | | | | | | | | | | |
| Beginning balance at January 1 | $ | 2 | | $ | (198) | | | | $ | (196) | | | | $ | 13 | | $ | (224) | | $ | (211) | |
| Realized and unrealized gains/(losses) included in regulatory assets/liabilities | (6) | | 24 | | | | 18 | | | | 20 | | (14) | | 6 | |
| | | | | | | | | | |
| | | | | | | | | | |
| Settlements | (1) | | 8 | | | | 7 | | | | (17) | | 9 | | (8) | |
| | | | | | | | | | |
| | | | | | | | | | |
| Ending balance at June 30 | $ | (5) | | $ | (166) | | | | $ | (171) | | | | $ | 16 | | $ | (229) | | $ | (213) | |
| Change in unrealized gains/(losses) related to assets/liabilities held at June 30 | $ | (3) | | $ | 24 | | | | $ | 21 | | | | $ | 12 | | $ | (13) | | $ | (1) | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2021 | | | 2020 |
| Ameren Missouri | Ameren Illinois | | | Ameren | | | Ameren Missouri | Ameren Illinois | Ameren |
| For the three months ended September 30: | | | | | | | | | | |
| Beginning balance at July 1 | $ | (5) | | $ | (166) | | | | $ | (171) | | | | $ | 16 | | $ | (229) | | $ | (213) | |
| Realized and unrealized gains/(losses) included in regulatory assets/liabilities | (16) | | 19 | | | | 3 | | | | (2) | | 12 | | 10 | |
| | | | | | | | | | |
| | | | | | | | | | |
| Settlements | (2) | | 3 | | | | 1 | | | | (4) | | 4 | | — | |
| | | | | | | | | | |
| | | | | | | | | | |
| Ending balance at September 30 | $ | (23) | | $ | (144) | | | | $ | (167) | | | | $ | 10 | | $ | (213) | | $ | (203) | |
| Change in unrealized gains/(losses) related to assets/liabilities held at September 30 | $ | (17) | | $ | 19 | | | | $ | 2 | | | | $ | (2) | | $ | 11 | | $ | 9 | |
| For the nine months ended September 30: | | | | | | | | | | |
| Beginning balance at January 1 | $ | 2 | | $ | (198) | | | | $ | (196) | | | | $ | 13 | | $ | (224) | | $ | (211) | |
| Realized and unrealized gains/(losses) included in regulatory assets/liabilities | (22) | | 43 | | | | 21 | | | | 18 | | (2) | | 16 | |
| | | | | | | | | | |
| | | | | | | | | | |
| Settlements | (3) | | 11 | | | | 8 | | | | (21) | | 13 | | (8) | |
| | | | | | | | | | |
| | | | | | | | | | |
| Ending balance at September 30 | $ | (23) | | $ | (144) | | | | $ | (167) | | | | $ | 10 | | $ | (213) | | $ | (203) | |
| Change in unrealized gains/(losses) related to assets/liabilities held at September 30 | $ | (21) | | $ | 42 | | | | $ | 21 | | | | $ | 6 | | $ | (1) | | $ | 5 | |
All gains or losses related to our Level 3 derivative commodity contracts are expected to be recovered or returned through customer rates; therefore, there is no impact to either net income or other comprehensive income resulting from changes in the fair value of these instruments.
The following table describes the valuation techniques and significant unobservable inputs utilized for the fair value of our Level 3 power derivative contract assets and liabilities as of JuneSeptember 30, 2021, and December 31, 2020:
| | | Fair Value | | Weighted Average(b) | | | Fair Value | | Weighted Average(b) | |
| | Commodity | | Assets | | Liabilities | Valuation Technique(s) | Unobservable Input(a) | Range | | | Commodity | | Assets | | Liabilities | Valuation Technique(s) | Unobservable Input(a) | Range | |
| | 2021 | 2021 | Power(c) | $ | 11 | $ | (182) | Discounted cash flow | Average forward peak and off-peak pricing – forwards/swaps ($/MWh) | 26 – 49 | 33 | | 2021 | Power(c) | $ | 21 | $ | (188) | Discounted cash flow | Average forward peak and off-peak pricing – forwards/swaps ($/MWh) | 28 – 77 | 40 | |
| | | Nodal basis ($/MWh) | (4) – 0 | (1) | | | Nodal basis ($/MWh) | (4) – 0 | (2) | |
| | | Trend rate (%) | 1 – 3 | 2 | | | Trend rate (%) | (4) – (2) | (3) | |
| | 2020 | 2020 | Power(c) | $ | 5 | $ | (201) | Discounted cash flow | Average forward peak and off-peak pricing – forwards/swaps ($/MWh) | 23 – 37 | 29 | | 2020 | Power(c) | $ | 5 | $ | (201) | Discounted cash flow | Average forward peak and off-peak pricing – forwards/swaps ($/MWh) | 23 – 37 | 29 | |
| | | Nodal basis ($/MWh) | (6) – 0 | (2) | | | Nodal basis ($/MWh) | (6) – 0 | (2) | |
| | | Trend rate (%) | 2 – 6 | 3 | | | Trend rate (%) | 2 – 6 | 3 | |
|
(a)Generally, significant increases (decreases) in these inputs in isolation would result in a significantly higher (lower) fair value measurement.
(b)Unobservable inputs were weighted by relative fair value.
(c)Valuations through 2029 use visible forward prices adjusted for nodal-to-hub basis differentials. Valuations beyond 2029 use a trend rate factor and are similarly adjusted for nodal-to-hub basis differentials.
The following table sets forth the carrying amount and, by level within the fair value hierarchy, the fair value of financial assets and liabilities disclosed, but not recorded, at fair value as of JuneSeptember 30, 2021, and December 31, 2020:
| | | Carrying
Amount | | Fair Value | | | Carrying
Amount | | Fair Value | |
| | Level 1 | | Level 2 | | Level 3 | | Total | | Level 1 | | Level 2 | | Level 3 | | Total |
| | June 30, 2021 | | September 30, 2021 |
| Ameren: | Ameren: | | Ameren: | |
| Cash, cash equivalents, and restricted cash | Cash, cash equivalents, and restricted cash | $ | 267 | | | $ | 267 | | | $ | 0 | | | $ | 0 | | | $ | 267 | | Cash, cash equivalents, and restricted cash | $ | 145 | | | $ | 145 | | | $ | — | | | $ | — | | | $ | 145 | |
Investments in industrial development revenue bonds(a) | Investments in industrial development revenue bonds(a) | 256 | | | 0 | | | 256 | | | 0 | | | 256 | | Investments in industrial development revenue bonds(a) | 256 | | | — | | | 256 | | | — | | | 256 | |
| Short-term debt | Short-term debt | 431 | | | 0 | | | 431 | | | 0 | | | 431 | | Short-term debt | 553 | | | — | | | 553 | | | — | | | 553 | |
Long-term debt (including current portion)(a) | Long-term debt (including current portion)(a) | 12,500 | | (b) | 0 | | | 13,647 | | | 528 | | (c) | 14,175 | | Long-term debt (including current portion)(a) | 12,501 | | (b) | — | | | 13,576 | | | 520 | | (c) | 14,096 | |
| Ameren Missouri: | Ameren Missouri: | | Ameren Missouri: | |
| Cash, cash equivalents, and restricted cash | Cash, cash equivalents, and restricted cash | $ | 17 | | | $ | 17 | | | $ | 0 | | | $ | 0 | | | $ | 17 | | Cash, cash equivalents, and restricted cash | $ | 11 | | | $ | 11 | | | $ | — | | | $ | — | | | $ | 11 | |
| Advances to money pool | Advances to money pool | 92 | | | 0 | | | 92 | | | 0 | | | 92 | | Advances to money pool | 24 | | | — | | | 24 | | | — | | | 24 | |
Investments in industrial development revenue bonds(a) | Investments in industrial development revenue bonds(a) | 256 | | | 0 | | | 256 | | | 0 | | | 256 | | Investments in industrial development revenue bonds(a) | 256 | | | — | | | 256 | | | — | | | 256 | |
| Long-term debt (including current portion)(a) | Long-term debt (including current portion)(a) | 5,626 | | (b) | 0 | | | 6,427 | | | 0 | | | 6,427 | | Long-term debt (including current portion)(a) | 5,626 | | (b) | — | | | 6,392 | | | — | | | 6,392 | |
| Ameren Illinois: | Ameren Illinois: | | Ameren Illinois: | |
| Cash, cash equivalents, and restricted cash | Cash, cash equivalents, and restricted cash | $ | 242 | | | $ | 242 | | | $ | 0 | | | $ | 0 | | | $ | 242 | | Cash, cash equivalents, and restricted cash | $ | 122 | | | $ | 122 | | | $ | — | | | $ | — | | | $ | 122 | |
| Advances to money pool | Advances to money pool | 20 | | | 0 | | | 20 | | | 0 | | | 20 | | Advances to money pool | 41 | | | — | | | 41 | | | — | | | 41 | |
| | Long-term debt (including current portion) | Long-term debt (including current portion) | 4,391 | | (b) | 0 | | | 5,038 | | | 0 | | | 5,038 | | Long-term debt (including current portion) | 4,391 | | (b) | — | | | 5,019 | | | — | | | 5,019 | |
| | December 31, 2020 | | December 31, 2020 |
| Ameren: | Ameren: | | Ameren: | |
| Cash, cash equivalents, and restricted cash | Cash, cash equivalents, and restricted cash | $ | 301 | | | $ | 301 | | | $ | 0 | | | $ | 0 | | | $ | 301 | | Cash, cash equivalents, and restricted cash | $ | 301 | | | $ | 301 | | | $ | — | | | $ | — | | | $ | 301 | |
Investments in industrial development revenue bonds(a) | Investments in industrial development revenue bonds(a) | 256 | | | 0 | | | 256 | | | 0 | | | 256 | | Investments in industrial development revenue bonds(a) | 256 | | | — | | | 256 | | | — | | | 256 | |
| Short-term debt | Short-term debt | 490 | | | 0 | | | 490 | | | 0 | | | 490 | | Short-term debt | 490 | | | — | | | 490 | | | — | | | 490 | |
Long-term debt (including current portion)(a) | Long-term debt (including current portion)(a) | 11,086 | | (b) | 0 | | | 12,778 | | | 537 | | (c) | 13,315 | | Long-term debt (including current portion)(a) | 11,086 | | (b) | — | | | 12,778 | | | 537 | | (c) | 13,315 | |
| Ameren Missouri: | Ameren Missouri: | | Ameren Missouri: | |
| Cash, cash equivalents, and restricted cash | Cash, cash equivalents, and restricted cash | $ | 145 | | | $ | 145 | | | $ | 0 | | | $ | 0 | | | $ | 145 | | Cash, cash equivalents, and restricted cash | $ | 145 | | | $ | 145 | | | $ | — | | | $ | — | | | $ | 145 | |
| Advances to money pool | Advances to money pool | 139 | | | 0 | | | 139 | | | 0 | | | 139 | | Advances to money pool | 139 | | | — | | | 139 | | | — | | | 139 | |
Investments in industrial development revenue bonds(a) | Investments in industrial development revenue bonds(a) | 256 | | | 0 | | | 256 | | | 0 | | | 256 | | Investments in industrial development revenue bonds(a) | 256 | | | — | | | 256 | | | — | | | 256 | |
| Long-term debt (including current portion)(a) | Long-term debt (including current portion)(a) | 5,104 | | (b) | 0 | | | 6,160 | | | 0 | | | 6,160 | | Long-term debt (including current portion)(a) | 5,104 | | (b) | — | | | 6,160 | | | — | | | 6,160 | |
| Ameren Illinois: | Ameren Illinois: | | Ameren Illinois: | |
| Cash, cash equivalents, and restricted cash | Cash, cash equivalents, and restricted cash | $ | 147 | | | $ | 147 | | | $ | 0 | | | $ | 0 | | | $ | 147 | | Cash, cash equivalents, and restricted cash | $ | 147 | | | $ | 147 | | | $ | — | | | $ | — | | | $ | 147 | |
| Borrowings from money pool | Borrowings from money pool | 19 | | | 0 | | | 19 | | | 0 | | | 19 | | Borrowings from money pool | 19 | | | — | | | 19 | | | — | | | 19 | |
| Long-term debt (including current portion) | Long-term debt (including current portion) | 3,946 | | (b) | 0 | | | 4,822 | | | 0 | | | 4,822 | | Long-term debt (including current portion) | 3,946 | | (b) | — | | | 4,822 | | | — | | | 4,822 | |
(a)Ameren and Ameren Missouri have investments in industrial development revenue bonds, classified as held-to-maturity and recorded in “Other Assets,” that are equal to the finance obligations for the Peno Creek and Audrain CT energy centers. As of JuneSeptember 30, 2021, and December 31, 2020, the carrying amount of both the investments in industrial development revenue bonds and the finance obligations approximated fair value.
(b)Included unamortized debt issuance costs, which were excluded from the fair value measurement, of $93 million, $40$39 million, and $40 million for Ameren, Ameren Missouri, and Ameren Illinois, respectively, as of JuneSeptember 30, 2021. Included unamortized debt issuance costs, which were excluded from the fair value measurement, of $84 million, $36 million, and $36 million for Ameren, Ameren Missouri, and Ameren Illinois, respectively, as of December 31, 2020.
(c)The Level 3 fair value amount consists of ATXI’s senior unsecured notes.
NOTE 8 – RELATED-PARTY TRANSACTIONS
In the ordinary course of business, Ameren Missouri and Ameren Illinois have engaged in, and may in the future engage in, affiliate transactions. These transactions primarily consist of natural gas and power purchases and sales, services received or rendered, and borrowings and lendings. Transactions between Ameren’s subsidiaries are reported as affiliate transactions on their individual financial statements, but those transactions are eliminated in consolidation for Ameren’s consolidated financial statements. For a discussion of material related-party agreements and money pool arrangements, see Note 13 – Related-party Transactions and Note 4 – Short-term Debt and Liquidity under Part II, Item 8, of the Form 10-K. For information on Ameren Missouri’s and Ameren Illinois’ capital contributions, see Note 4 – Long-term Debt and Equity Financings.
Electric Power and Capacity Supply Agreement
In April and September 2021, Ameren Illinois conducted a procurement event,events, administered by the IPA, to purchase energy products.products and acquire capacity. Ameren Missouri was among the winning suppliers in this event. As a result, in April 2021, Ameren Missouri and Ameren Illinois entered into an energy product agreement by which Ameren Missouri agreed to sell, and Ameren Illinois agreed to purchase, 33,600 MWhs at an average price of $34 per MWh during the period of July 2022 through November 2022. In September 2021, Ameren Missouri contracted to supply a portion of Ameren Illinois’ capacity requirements for $2 million from June 2022 through May 2023. Additionally, in September 2021, Ameren Missouri and Ameren Illinois entered into an energy product agreement by which Ameren Missouri agreed to sell, and Ameren Illinois agreed to purchase, 136,000 MWhs at an average price of $37 per MWh during the period of January 2022 through September 2023.
Tax Allocation Agreement
See Note 1 – Summary of Significant Accounting Policies under Part II, Item 8, of the Form 10-K for a discussion of the tax allocation agreement. The following table presents the affiliate balances related to income taxes for Ameren Missouri and Ameren Illinois as of JuneSeptember 30, 2021, and December 31, 2020:
| | | June 30, 2021 | | | December 31, 2020 | | September 30, 2021 | | | December 31, 2020 |
| | Ameren Missouri | Ameren Illinois | | | Ameren Missouri | Ameren Illinois | | Ameren Missouri | Ameren Illinois | | | Ameren Missouri | Ameren Illinois |
Income taxes payable to parent(a) | Income taxes payable to parent(a) | $ | 47 | | $ | 26 | | | | $ | 0 | | $ | 6 | | Income taxes payable to parent(a) | $ | — | | $ | 12 | | | | $ | — | | $ | 6 | |
Income taxes receivable from parent(b) | Income taxes receivable from parent(b) | 0 | | 0 | | | | 9 | | 15 | | Income taxes receivable from parent(b) | — | | 44 | | | | 9 | | 15 | |
(a)Included in “Accounts payable – affiliates” on the balance sheet.
(b)Included in “Accounts receivable – affiliates” on the balance sheet.
Effects of Related-party Transactions on the Statement of Income
The following table presents the effect on Ameren Missouri and Ameren Illinois of related-party transactions for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Three Months | | Six Months | | Three Months | | Nine Months |
| Agreement | Agreement | Income Statement
Line Item | | Ameren
Missouri | | Ameren
Illinois | | Ameren
Missouri | | Ameren
Illinois | Agreement | Income Statement
Line Item | | Ameren
Missouri | | Ameren
Illinois | | Ameren
Missouri | | Ameren
Illinois |
| Ameren Missouri power supply | Ameren Missouri power supply | Operating Revenues | 2021 | $ | 3 | | $ | (a) | $ | 5 | | $ | (a) | Ameren Missouri power supply | Operating Revenues | 2021 | $ | 5 | | $ | (a) | $ | 10 | | $ | (a) |
| agreements with Ameren Illinois | agreements with Ameren Illinois | | 2020 | | 3 | | | (a) | | 6 | | | (a) | agreements with Ameren Illinois | | 2020 | | 5 | | | (a) | | 11 | | | (a) |
| Ameren Missouri and Ameren Illinois | Ameren Missouri and Ameren Illinois | Operating Revenues | 2021 | $ | 7 | | $ | (b) | $ | 14 | | $ | (b) | Ameren Missouri and Ameren Illinois | Operating Revenues | 2021 | $ | 6 | | $ | (b) | $ | 20 | | $ | (b) |
| rent and facility services | rent and facility services | | 2020 | | 6 | | | (b) | | 13 | | | 1 | | rent and facility services | | 2020 | | 6 | | | (b) | | 19 | | | 1 | |
| Ameren Missouri and Ameren Illinois miscellaneous | Ameren Missouri and Ameren Illinois miscellaneous | Operating Revenues | 2021 | $ | (b) | $ | 2 | | $ | (b) | $ | 2 | | Ameren Missouri and Ameren Illinois miscellaneous | Operating Revenues | 2021 | $ | (b) | $ | 3 | | $ | (b) | $ | 5 | |
| support services and services provided to ATXI | support services and services provided to ATXI | | 2020 | | 1 | | | (b) | | 1 | | | (b) | support services and services provided to ATXI | | 2020 | | (b) | | 1 | | | 1 | | | 1 | |
| Total Operating Revenues | Total Operating Revenues | | 2021 | $ | 10 | | $ | 2 | | $ | 19 | | $ | 2 | | Total Operating Revenues | | 2021 | $ | 11 | | $ | 3 | | $ | 30 | | $ | 5 | |
| | 2020 | | 10 | | | (b) | | 20 | | | 1 | | | 2020 | | 11 | | | 1 | | | 31 | | | 2 | |
| Ameren Illinois power supply | Ameren Illinois power supply | Purchased Power | 2021 | $ | (a) | $ | 3 | | $ | (a) | $ | 5 | | Ameren Illinois power supply | Purchased Power | 2021 | $ | (a) | $ | 5 | | $ | (a) | $ | 10 | |
| agreements with Ameren Missouri | agreements with Ameren Missouri | | 2020 | | (a) | | 3 | | | (a) | | 6 | | agreements with Ameren Missouri | | 2020 | | (a) | | 5 | | | (a) | | 11 | |
| Ameren Missouri and Ameren Illinois | Ameren Missouri and Ameren Illinois | Purchased Power | 2021 | $ | 1 | | $ | 1 | | $ | 2 | | $ | 1 | | Ameren Missouri and Ameren Illinois | Purchased Power | 2021 | $ | 1 | | $ | (b) | $ | 3 | | $ | 1 | |
| transmission services from ATXI | transmission services from ATXI | | 2020 | | (a) | | 1 | | | (a) | | 1 | | transmission services from ATXI | | 2020 | | (a) | | (b) | | (a) | | 1 | |
| Total Purchased Power | Total Purchased Power | | 2021 | $ | 1 | | $ | 4 | | $ | 2 | | $ | 6 | | Total Purchased Power | | 2021 | $ | 1 | | $ | 5 | | $ | 3 | | $ | 11 | |
| | 2020 | | (a) | | 4 | | | (a) | | 7 | | | 2020 | | (a) | | 5 | | | (a) | | 12 | |
| Ameren Missouri and Ameren Illinois | Ameren Missouri and Ameren Illinois | Other Operations and Maintenance | 2021 | $ | (b) | $ | 1 | | $ | (b) | $ | 2 | | Ameren Missouri and Ameren Illinois | Other Operations and Maintenance | 2021 | $ | (b) | $ | 1 | | $ | (b) | $ | 3 | |
| rent and facility services | rent and facility services | | 2020 | | (b) | | 1 | | | (b) | | 2 | | rent and facility services | | 2020 | | (b) | | 1 | | | (b) | | 3 | |
| | | Three Months | | Six Months | | Three Months | | Nine Months |
| Agreement | Agreement | Income Statement
Line Item | | Ameren
Missouri | | Ameren
Illinois | | Ameren
Missouri | | Ameren
Illinois | Agreement | Income Statement
Line Item | | Ameren
Missouri | | Ameren
Illinois | | Ameren
Missouri | | Ameren
Illinois |
| Ameren Services support services | Ameren Services support services | Other Operations and Maintenance | 2021 | $ | 34 | | $ | 31 | | $ | 69 | | $ | 64 | | Ameren Services support services | Other Operations and Maintenance | 2021 | $ | 41 | | $ | 37 | | $ | 110 | | $ | 101 | |
| agreement | agreement | | 2020 | | 32 | | | 31 | | | 67 | | | 64 | | agreement | | 2020 | | 36 | | | 34 | | | 103 | | | 98 | |
| Total Other Operations and | Total Other Operations and | | 2021 | $ | 34 | | $ | 32 | | $ | 69 | | $ | 66 | | Total Other Operations and | | 2021 | $ | 41 | | $ | 38 | | $ | 110 | | $ | 104 | |
| Maintenance | Maintenance | | 2020 | | 32 | | | 32 | | | 67 | | | 66 | | Maintenance | | 2020 | | 36 | | | 35 | | | 103 | | | 101 | |
| Money pool borrowings (advances) | Money pool borrowings (advances) | (Interest Charges)/Other Income, Net | 2021 | $ | (b) | $ | (b) | $ | (b) | $ | (b) | Money pool borrowings (advances) | (Interest Charges)/Other Income, Net | 2021 | $ | (b) | $ | (b) | $ | (b) | $ | (b) |
| | 2020 | | (b) | | (b) | | (b) | | (b) | | 2020 | | (b) | | (b) | | (b) | | (b) |
(a)Not applicable.
(b)Amount less than $1 million.
NOTE 9 – COMMITMENTS AND CONTINGENCIES
We are involved in legal, tax, and regulatory proceedings before various courts, regulatory commissions, authorities, and governmental agencies with respect to matters that arise in the ordinary course of business, some of which involve substantial amounts of money. We believe that the final disposition of these proceedings, except as otherwise disclosed in the notes to our financial statements in this report and in the Form 10-K, will not have a material adverse effect on our results of operations, financial position, or liquidity.
Reference is made to Note 1 – Summary of Significant Accounting Policies, Note 2 – Rate and Regulatory Matters, Note 9 – Callaway Energy Center, Note 13 – Related-party Transactions, and Note 14 – Commitments and Contingencies under Part II, Item 8, of the Form 10-K. See also Note 1 – Summary of Significant Accounting Policies, Note 2 – Rate and Regulatory Matters, Note 8 – Related-party Transactions, and Note 10 – Callaway Energy Center of this report.
Environmental Matters
Our electric and natural gas generation, transmission, distribution and natural gas storage operations must comply with a variety of environmental statutory and regulatory requirements, including permitting programs implemented via federal, state, and local authorities. Such laws address air emissions; discharges to water bodies; the storage, handling, and disposal of hazardous substances and waste materials; siting and land use requirements; and potential ecological impacts. Complex and lengthy processes are required to obtain and renew approvals, permits, and licenses for new, existing, or modified facilities. Additionally, the use and handling of various chemicals or hazardous materials require release prevention plans and emergency response procedures. We employ dedicated personnel knowledgeable in environmental matters to oversee our business activities’ compliance with regulatory requirements.
Environmental regulations have a significant impact on the electric utility industry and compliance with these regulations could be costly for Ameren Missouri, which operates coal-fired power plants. Clean Air Act regulations that apply to the electric utility industry include the NSPS, the CSAPR, the MATS, and the National Ambient Air Quality Standards, which are subject to periodic review for certain pollutants. Collectively, these regulations cover a variety of pollutants, such as SO2, particulate matter, NOx, mercury, toxic metals and acid gases, and CO2 emissions from new power plants. Regulations implementing the Clean Water Act govern both intake and discharges of water, and may require evaluation of the ecological and biological impact of our operations and could require modifications to water intake structures or more stringent limitations on wastewater discharges. Depending upon the scope of modifications ultimately required by state regulators, these capital expenditures could be significant. The management and disposal of coal ash is regulated under the Resource Conservation and Recovery Act and the CCR rule, which require the closure of our surface impoundments at Ameren Missouri’s coal-fired energy centers. Additionally, Ameren Missouri’s wind generation facilities may be subject to operating restrictions to limit the impact on protected species. The individual or combined effects of existing and new environmental regulations could result in significant capital expenditures, increased operating costs, or the closure or alteration of operations at some of Ameren Missouri’s energy centers. Ameren and Ameren Missouri expect that such compliance costs would be recoverable through rates, subject to MoPSC prudence review, but the timing of costs and their recovery could be subject to regulatory lag.
Ameren and Ameren Missouri estimate that they will need to make capital expenditures of $175 million to $225 million from 2021 through 2025 in order to comply with existing environmental regulations. Additional environmental controls beyond 2025 could be required. This estimate of capital expenditures includes ash pond closure and corrective action measures required by the CCR regulations and the effluent limitation guidelines applicable to steam electric generating units, and potential modifications to cooling water intake structures at existing power plants under Clean Water Act rules, all of which are discussed below. This estimate does not include capital expenditures that may be required as a result of the NSR and Clean Air Act litigation discussed below. In addition to planned retirements of coal-fired energy centers as set forth in the 2020 IRP, Ameren Missouri’s current plan for compliance with existing air emission regulations includes burning low-sulfur coal and installing new or optimizing existing air pollution control equipment. The actual amount of capital expenditures required to comply with existing environmental regulations may vary substantially from the above estimates because of uncertainty as to future permitting requirements made by state regulators and the EPA, potential revisions to regulatory obligations, and the cost of potential compliance strategies, among other things.
The following sections describe the more significant environmental laws and rules and environmental enforcement and remediation matters that affect or could affect our operations. The EPA has initiated an administrative review of several regulations and proposed amendments to regulations and guidelines, including to the effluent limitation guidelines and the CCR Rule, which could ultimately result in the revision of all or part of such rules. Additionally, Ameren Missouri’s wind generation facilities may be subject to operating restrictions to limit the impact on protected species. From April 2021 through October 2021, Ameren Missouri's High Prairie Renewable Energy Center curtailed nighttime operations to limit impacts on protected species. Ameren Missouri expects to resume nighttime operations in November 2021 as the critical biological season for the year had ended, but seasonal nighttime curtailment may occur in 2022 as assessment of mitigation technologies to reduce such impacts is ongoing. Ameren Missouri does not anticipate material adverse effects resulting from these operating curtailments. See Note 2 – Rate and Regulatory Matters for information on intervenors’ challenges resulting from the High Prairie Renewable Energy Center’s curtailment in Ameren Missouri’s 2021 electric service regulatory rate review.
Clean Air Act
Federal and state laws, including CSAPR, regulate emissions of SO2 and NOx through the reduction of emissions at their source and the use and retirement of emission allowances. CSAPR is implemented through a series of phases, and the second phase became effective in 2017. Additional emission reduction requirements may apply in subsequent years. Ameren Missouri complies with current CSAPR requirements by minimizing emissions through the use of low-sulfur coal, operation of 2 scrubbers at its Sioux Energy Center, and optimization of other existing air pollution control equipment. Ameren Missouri could incur additional costs to lower its emissions at one or more of its energy centers to comply with additional CSAPR requirements in future years. These additional costs for compliance are expected to be recovered from customers through the FAC or higher base rates.
CO2 Emissions Standards
The EPA’s Affordable Clean Energy Rule repealed the Clean Power Plan and replaced it with a new rule that established emission guidelines for states to follow in developing plans to limit CO2 emissions and identified certain efficiency measures as the best system of emission reduction for coal-fired electric generating units. In January 2021, the United States Court of Appeals for the District of Columbia Circuit vacated the Affordable Clean Energy Rule, and ruled that the EPA had the discretion to consider emission reduction measures that include efficiency measures and generation shifting to lower carbon emissions. Various petitions for review are pending beforeIn October 2021, the United States Supreme Court agreed to review the circuit court’s ruling, and a decision on whetheris expected to occur in mid-2022. Actions by the United States Supreme Court will reviewcould impact the circuit court's ruling could occur in second halfEPA’s development of 2021. Regardless of the outcome of those legal challenges, the EPA is likely to develop new regulations to address carbon emissions from coal and natural gas electric generating units. At this time, Ameren Missouri cannot predict the outcome of legal challenges to the vacated Affordable Clean Energy Rule or future rulemakings. As such, the impact on the results of operations, financial position, and liquidity of Ameren and Ameren Missouri is uncertain.
NSR and Clean Air Litigation
In January 2011, the United States Department of Justice, on behalf of the EPA, filed a complaint against Ameren Missouri in the United States District Court for the Eastern District of Missouri alleging that in performing projects at its coal-fired Rush Island Energy Center in 2007 and 2010, Ameren Missouri violated provisions of the Clean Air Act and Missouri law. In January 2017, the district court issued a liability ruling against Ameren Missouri and in September 2019, entered a finalremedy order that required Ameren Missouri to install a flue gas desulfurization system at the Rush Island Energy Center and a dry sorbent injection system at the Labadie Energy Center. There were no finesAmeren Missouri appealed both the liability and remedy orders and, in August 2021, a three-judge panel of the United States Court of Appeals for the Eighth Circuit issued a decision that affirmed the liability ruling and the district court’s remedy order as it related to the installation of a flue gas desulfurization system at the Rush Island Energy Center, but reversed the order as the Department of Justice previously dismissed claims for penalties. Full implementation of the district court’s order has been stayed, and Ameren Missouri does not expect to make significant capital expenditures or incur operations and maintenance expensesit related to the district court’s order whileinstallation of a dry sorbent injection system at the case is under appeal. In December 2020,Labadie Energy Center. Ameren Missouri believes that both the court of appeals heard oral arguments presented byand the parties. Thedistrict court is under no deadlinehave misinterpreted and misapplied the law with respect to issuethe Rush Island Energy Center in their respective rulings. In October 2021, Ameren Missouri sought reconsideration of the panel’s decision before the entire court of appeals, and the United States Department of Justice sought reconsideration of the panel’s decision rejecting the requirement to install a ruling in this case anddry sorbent injection system at the Labadie Energy Center.
Under the terms of the remedy order, Ameren Missouri is unablerequired to predict the ultimate resolution of this matter. Ameren Missouri expects a ruling by the court of appeals during 2021.
The ultimate resolution of this matter could have a material adverse effect on the results of operations, financial position, and liquidity of Ameren and Ameren Missouri. Among other things and subject to economic and regulatory considerations, resolution of this matter could result in increased capital expenditures forcomplete the installation of air pollution control equipment, as well as increased operationsthe flue gas desulfurization system at the Rush Island Energy Center within four and maintenance expenses.one-half years from the conclusion of the appeal process and entry of a final judgement. Based upon engineering studies from October 2019, capital expenditures to comply with the district court’s order for installation of a flue gas desulfurization system at the Rush Island Energy Center arewere estimated at approximatelyup to $1 billion. Further, the flue gas desulfurization system would result inbillion along with additional operation and maintenance expenses of $30 million to $50 million annually for the life of the energy center. Engineering studies required to develop estimated capital expenditures and estimated additional operation and maintenance expensesAmeren Missouri’s 2020 IRP reflected an expected retirement date of 2039 for the LabadieRush Island Energy Center and did not reflect the installation of a flue gas desulfurization system at the Rush Island Energy Center. As of September 30, 2021, the Rush Island Energy Center represented a rate base of approximately $0.4 billion. Ameren Missouri is assessing several alternatives to complyeffectively address the court of appeals decision, including legal, operational, and regulatory measures. To the extent the resolution of the proceedings described above results in changes to the planned timing of energy center retirements, the timing and level of new generation resources, transmission infrastructure needs, or reliability considerations, Ameren Missouri would file an update to its 2020 IRP with the district court’s order will not be undertaken whileMoPSC.
Ameren Missouri is unable to predict the case is under appeal.ultimate resolution of this matter; however, such resolution could have a material adverse effect on the results of operations, financial position, and liquidity of Ameren and Ameren Missouri.
Clean Water Act
The EPA’s regulations implementing Section 316(b) of the Clean Water Act require power plant operators to evaluate cooling water intake structures and identify measures for reducing the number of aquatic organisms impinged on a power plant’s cooling water intake screens or entrained through the plant’s cooling water system. All of Ameren Missouri’s coal-fired and nuclear energy centers are subject to the cooling water intake structures rule. Requirements of the rule are implemented by state regulators through the permit renewal process of each power plant’s water discharge permit, which is expected to be completed by 2023 for Ameren Missouri.
In 2015, the EPA issued a rule to revise the effluent limitation guidelines applicable to steam electric generating units. These guidelines established national standards for water discharges, prohibit effluent discharges of certain waste streams, and impose more stringent limitations on certain water discharges from power plants. To meet the requirements of the guidelines, Ameren Missouri installed dry ash handling systems and in 2020 completed construction of wastewater treatment facilities at 3 of its 4 coal-fired energy centers. The Meramec Energy Center is scheduled to close permanently in 2022 and, as a result, does not require new wastewater and dry ash handling systems. Estimated capital expenditures to complete these projects are included in the CCR management compliance plan, discussed below.
CCR Management
The EPA’s CCR rule establishes requirements for the management and disposal of CCR from coal-fired power plants and will result in the closure of surface impoundments at Ameren Missouri’s energy centers. Ameren Missouri has completed or expects to complete closure of surface impoundments at 3 of its facilities in 2021, and is scheduled to complete the last of such closures at a fourth facility in 2023. The EPA has issued a series of revisions to the CCR rule; however, none of those revisions is expected to materially impact our closure schedule. Ameren and Ameren Missouri have AROs of $97$88 million recorded on their respective balance sheets as of JuneSeptember 30, 2021, associated with CCR storage facilities. Ameren Missouri estimates it will need to make capital expenditures of $75 million to $100 million from 2021 through 2025 to implement its CCR management compliance plan, which includes installation of groundwater monitoring equipment and groundwater treatment facilities.
Remediation
The Ameren Companies are involved in a number of remediation actions to clean up sites impacted by the use or disposal of materials containing hazardous substances. Federal and state laws can require responsible parties to fund remediation regardless of their degree of fault, the legality of original disposal, or the ownership of a disposal site.
As of JuneSeptember 30, 2021, Ameren Illinois has remediated the majority of the 44 former MGP sites in Illinois and could substantially conclude remediation efforts at the remaining sites by 2023. The ICC allows Ameren Illinois to recover such remediation and related litigation costs from its electric and natural gas utility customers through environmental cost riders that are subject to annual prudence reviews by the ICC. As of JuneSeptember 30, 2021, Ameren Illinois estimated the remaining obligation related to these former MGP sites at $85$80 million to $150$145 million. Ameren and Ameren Illinois recorded a liability of $85$80 million to represent the estimated minimum obligation for these sites, as no other amount within the range was a better estimate.
The scope of the remediation activities at these former MGP sites may increase as remediation efforts continue. Considerable uncertainty remains in these estimates because many site-specific factors can influence the ultimate actual costs, including unanticipated underground structures, the degree to which groundwater is encountered, regulatory changes, local ordinances, and site accessibility. The actual costs and timing of completion may vary substantially from these estimates.
Our operations or those of our predecessor companies involve the use of, disposal of, and, in appropriate circumstances, the cleanup of substances regulated under environmental laws. We are unable to determine whether such historical practices will result in future environmental commitments or will affect our results of operations, financial position, or liquidity.
Illinois Emission Standards
The CEJA established emission standards that will limit the operations of Ameren Missouri's 5 natural gas-fired energy centers located in the state of Illinois, including the possibility of 1 or more energy center closures earlier than anticipated. These energy centers are utilized to support peak loads. The emission limitations will become effective between 2030 and 2040. Ameren Missouri is reviewing the emission standards and the resulting effect they may have on its generation strategy, including any increases in capital expenditures or operating costs, or limits to the useful lives of the 5 natural gas-fired energy centers.
NOTE 10 – CALLAWAY ENERGY CENTER
See Note 9 – Callaway Energy Center under Part II, Item 8, of the Form 10-K for information regarding spent nuclear fuel recovery, recovery of decommissioning costs, and the nuclear decommissioning trust fund. The fair value of the trust fund for Ameren Missouri’s Callaway Energy Center is reported as “Nuclear decommissioning trust fund” in Ameren’s and Ameren Missouri’s balance sheets. This amount is legally restricted and may be used only to fund the costs of nuclear decommissioning. Changes in the fair value of the trust fund are recorded as an increase or decrease to the nuclear decommissioning trust fund, with an offsetting adjustment to the related regulatory liability. Ameren and Ameren Missouri have recorded an ARO for the Callaway Energy Center decommissioning costs at fair value, which represents the present value of estimated future cash outflows. Annual decommissioning costs of $7 million are included in the costs used to establish electric rates for Ameren Missouri’s customers. Every three years, the MoPSC requires Ameren Missouri to file an updated cost study and funding analysis for decommissioning its Callaway Energy Center. An updated cost study and funding analysis was filed with the MoPSC in November 2020 and reflected within the ARO. In February 2021, the MoPSC approved no change in electric rates for decommissioning costs based on Ameren Missouri’s updated cost study funding analysis. See Note 13 – Supplemental Information for more information on Ameren Missouri’s AROs.
Maintenance Outage
During its return to full power after the completion of the last refueling and maintenance outage in late December 2020, the Callaway Energy Center experienced a non-nuclear operating issue related to its generator. After replacement of certain key components of the generator, the energy center returned to service on August 4, 2021. The cost of generator repairs was approximately $60 million, which was
largely capital expenditures. In April 2021, Ameren Missouri’s insurance claims were accepted by NEIL, which are expected to cover a significant portion of the capital expenditures and covered lost sales of up to $4.5 million weekly after March 17, 2021. Insurance recoveries related to lost sales were reflected in electric operating revenues and included in net energy costs under the FAC. Expected insurance recoveries related to the capital expenditures were reflected as a reduction to property, plant, and equipment. As of JuneSeptember 30, 2021, a $36$35 million insurance receivable was included in “Miscellaneous accounts receivable” on Ameren’s and Ameren Missouri’s balance sheets. Ameren Missouri continues its review of the cause of the outage and the potential for legal remedies against responsible third parties.
Insurance
The following table presents insurance coverage at Ameren Missouri’s Callaway Energy Center at JuneSeptember 30, 2021:
| | Type and Source of Coverage | Type and Source of Coverage | Most Recent
Renewal Date | Maximum Coverages | | Maximum Assessments
for Single Incidents | | Type and Source of Coverage | Most Recent
Renewal Date | Maximum Coverages | | Maximum Assessments
for Single Incidents | |
| Public liability and nuclear worker liability: | Public liability and nuclear worker liability: | | Public liability and nuclear worker liability: | |
| American Nuclear Insurers | American Nuclear Insurers | January 1, 2021 | $ | 450 | | | $ | 0 | | | American Nuclear Insurers | January 1, 2021 | $ | 450 | | | $ | — | | |
| Pool participation | Pool participation | (a) | 13,073 | | (a) | 138 | | (b) | Pool participation | (a) | 13,073 | | (a) | 138 | | (b) |
| | $ | 13,523 | | (c) | $ | 138 | | | | $ | 13,523 | | (c) | $ | 138 | | |
| Property damage: | Property damage: | | Property damage: | |
| NEIL and EMANI | NEIL and EMANI | April 1, 2021 | $ | 3,200 | | (d) | $ | 25 | | (e) | NEIL and EMANI | April 1, 2021 | $ | 3,200 | | (d) | $ | 25 | | (e) |
| Accidental outage: | Accidental outage: | | Accidental outage: | |
| NEIL | NEIL | April 1, 2021 | $ | 490 | | (f) | $ | 7 | | (e) | NEIL | April 1, 2021 | $ | 490 | | (f) | $ | 7 | | (e) |
(a)Provided through mandatory participation in an industrywide retrospective premium assessment program. The maximum coverage available is dependent on the number of United States commercial reactors participating in the program.
(b)Retrospective premium under the Price-Anderson Act. This is subject to retrospective assessment with respect to a covered loss in excess of $450 million in the event of an incident at any licensed United States commercial reactor, payable at $21 million per year.
(c)Limit of liability for each incident under the Price-Anderson liability provisions of the Atomic Energy Act of 1954, as amended. This limit is subject to change to account for the effects of inflation and changes in the number of licensed power reactors.
(d)NEIL provides $2.7 billion in property damage, stabilization, decontamination, and premature decommissioning insurance for radiation events and $2.3 billion in property damage insurance for nonradiation events. EMANI provides $490 million in property damage insurance for both radiation and nonradiation events.
(e)All NEIL-insured plants could be subject to assessments should losses exceed the accumulated funds from NEIL.
(f)Accidental outage insurance provides for lost sales in the event of a prolonged accidental outage. Weekly indemnity up to $4.5 million for 52 weeks, which commences after the first 12 weeks of an outage, plus up to $3.6 million per week for a minimum of 71 weeks thereafter for a total not exceeding the policy limit of $490 million. Nonradiation events are limited to $328 million.
The Price-Anderson Act is a federal law that limits the liability for claims from an incident involving any licensed United States commercial nuclear energy center. The limit is based on the number of licensed reactors. The limit of liability and the maximum potential annual payments are adjusted at least every five years for inflation to reflect changes in the Consumer Price Index. The most recent five-year inflationary adjustment became effective in November 2018. Owners of a nuclear reactor cover this exposure through a combination of private insurance and mandatory participation in a financial protection pool, as established by the Price-Anderson Act.
Losses resulting from terrorist attacks on nuclear facilities insured by NEIL are subject to industrywide aggregates, such that terrorist acts against one or more commercial nuclear power plants within a stated time period would be treated as a single event, and the owners of the nuclear power plants would share the limit of liability. NEIL policies have an aggregate limit of $3.2 billion within a 12-month period for
radiation events, or $1.8 billion for events not involving radiation contamination, resulting from terrorist attacks. The EMANI policies are not subject to industrywide aggregates in the event of terrorist attacks on nuclear facilities.
If losses from a nuclear incident at the Callaway Energy Center exceed the limits of, or are not covered by insurance, or if coverage is unavailable, Ameren Missouri is at risk for any uninsured losses. If a serious nuclear incident were to occur, it could have a material adverse effect on Ameren’s and Ameren Missouri’s results of operations, financial position, or liquidity.
NOTE 11 – RETIREMENT BENEFITS
The following table presents the components of the net periodic benefit cost (income) incurred for Ameren’s pension and postretirement benefit plans for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Pension Benefits | | | Postretirement Benefits | | Pension Benefits | | | Postretirement Benefits |
| | Three Months | | Six Months | | | Three Months | | Six Months | | Three Months | | Nine Months | | | Three Months | | Nine Months |
| | 2021 | | 2020 | | 2021 | | 2020 | | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | | 2021 | | 2020 | | 2021 | | 2020 |
Service cost(a) | Service cost(a) | $ | 34 | | | $ | 28 | | | $ | 67 | | | $ | 55 | | | | $ | 6 | | | $ | 6 | | | $ | 12 | | | $ | 10 | | Service cost(a) | $ | 33 | | | $ | 28 | | | $ | 100 | | | $ | 83 | | | | $ | 5 | | | $ | 4 | | | $ | 17 | | | $ | 14 | |
| Non-service cost components: | Non-service cost components: | | | | Non-service cost components: | | | |
| Interest cost | Interest cost | 38 | | | 44 | | | 76 | | | 87 | | | | 8 | | | 9 | | | 16 | | | 19 | | Interest cost | 38 | | | 43 | | | 114 | | | 130 | | | | 9 | | | 10 | | | 25 | | | 29 | |
| Expected return on plan assets | Expected return on plan assets | (74) | | | (72) | | | (149) | | | (145) | | | | (20) | | | (20) | | | (40) | | | (40) | | Expected return on plan assets | (74) | | | (73) | | | (223) | | | (218) | | | | (20) | | | (20) | | | (60) | | | (60) | |
| Amortization of: | Amortization of: | | | | Amortization of: | | | |
| | Prior service benefit | Prior service benefit | 0 | | | (1) | | | 0 | | | (1) | | | | (1) | | | (1) | | | (2) | | | (2) | | Prior service benefit | — | | | — | | | — | | | (1) | | | | (1) | | | (1) | | | (3) | | | (3) | |
| Actuarial loss (gain) | Actuarial loss (gain) | 20 | | | 16 | | | 37 | | | 30 | | | | (2) | | | (2) | | | (3) | | | (4) | | Actuarial loss (gain) | 18 | | | 15 | | | 55 | | | 45 | | | | (1) | | | (3) | | | (4) | | | (7) | |
Total non-service cost components(b) | Total non-service cost components(b) | $ | (16) | | | $ | (13) | | | $ | (36) | | | $ | (29) | | | | $ | (15) | | | $ | (14) | | | $ | (29) | | | $ | (27) | | Total non-service cost components(b) | $ | (18) | | | $ | (15) | | | $ | (54) | | | $ | (44) | | | | $ | (13) | | | $ | (14) | | | $ | (42) | | | $ | (41) | |
| | Net periodic benefit cost (income) | Net periodic benefit cost (income) | $ | 18 | | | $ | 15 | | | $ | 31 | | | $ | 26 | | | | $ | (9) | | | $ | (8) | | | $ | (17) | | | $ | (17) | | Net periodic benefit cost (income) | $ | 15 | | | $ | 13 | | | $ | 46 | | | $ | 39 | | | | $ | (8) | | | $ | (10) | | | $ | (25) | | | $ | (27) | |
(a)Service cost, net of capitalization, is reflected in “Operating Expenses – Other operations and maintenance” on Ameren’s statement of income.
(b)Non-service cost components are reflected in “Other Income, Net” on Ameren’s statement of income. See Note 5 – Other Income, Net, for additional information.
Ameren Missouri and Ameren Illinois are responsible for their respective share of Ameren’s pension and other postretirement costs. The following table presents the respective share of net periodic pension and other postretirement benefit costs (income) incurred for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Pension Benefits | | | Postretirement Benefits | | Pension Benefits | | | Postretirement Benefits |
| | Three Months | | Six Months | | | Three Months | | Six Months | | Three Months | | Nine Months | | | Three Months | | Nine Months |
| | 2021 | | 2020 | | 2021 | | 2020 | | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | | 2021 | | 2020 | | 2021 | | 2020 |
Ameren Missouri(a) | Ameren Missouri(a) | $ | 9 | | | $ | 7 | | | $ | 15 | | | $ | 11 | | | | $ | (1) | | | $ | (1) | | | $ | (2) | | | $ | (2) | | Ameren Missouri(a) | $ | 7 | | | $ | 5 | | | $ | 22 | | | $ | 16 | | | | $ | (1) | | | $ | (2) | | | $ | (3) | | | $ | (4) | |
| Ameren Illinois | Ameren Illinois | 9 | | | 9 | | | 17 | | | 16 | | | | (8) | | | (8) | | | (15) | | | (16) | | Ameren Illinois | 8 | | | 8 | | | 25 | | | 24 | | | | (8) | | | (8) | | | (23) | | | (24) | |
| Other | Other | 0 | | | (1) | | | (1) | | | (1) | | | | 0 | | | 1 | | | 0 | | | 1 | | Other | — | | | — | | | (1) | | | (1) | | | | 1 | | | — | | | 1 | | | 1 | |
Ameren(a) | Ameren(a) | $ | 18 | | | $ | 15 | | | $ | 31 | | | $ | 26 | | | | $ | (9) | | | $ | (8) | | | $ | (17) | | | $ | (17) | | Ameren(a) | $ | 15 | | | $ | 13 | | | $ | 46 | | | $ | 39 | | | | $ | (8) | | | $ | (10) | | | $ | (25) | | | $ | (27) | |
(a)Does not include the impact of the regulatory tracking mechanism for the difference between the level of pension and postretirement benefit costs incurred by Ameren Missouri under GAAP and the level of such costs included in rates.
NOTE 12 – INCOME TAXES
The following table presents a reconciliation of the federal statutory corporate income tax rate to the effective income tax rate for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ameren | | Ameren Missouri | | Ameren Illinois | |
| 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | |
| Three Months | | | | | | | | | | | | |
| Federal statutory corporate income tax rate | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | |
| Increases (decreases) from: | | | | | | | | | | | | |
| Amortization of deferred investment tax credit | 0 | | | 0 | | | (1) | | | (1) | | | 0 | | | 0 | | |
| Amortization of excess deferred taxes | (9) | | | (9) | |
| (17) | | | (16) | |
| (2) | | | (3) | | |
| Depreciation differences | 0 | | | 0 | | | 1 | | | 0 | | | 1 | | | 1 | | |
| | | | | | | | | | | | |
| Renewable and other tax credits | (4) | | (a) | 0 | | | (10) | | (a) | 0 | | | (1) | | | 0 | | |
| State tax | 5 | | | 5 | | | 3 | | | 3 | | | 7 | | | 7 | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
| Effective income tax rate | 13 | % | | 17 | % | | (3) | % | | 7 | % | | 26 | % | | 26 | % | |
| Six Months | | | | | | | | | | | | |
| Federal statutory corporate income tax rate | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | |
| Increases (decreases) from: | | | | | | | | | | | | |
| Amortization of deferred investment tax credit | 0 | | | 0 | | | (1) | | | (1) | | | 0 | | | 0 | | |
| Amortization of excess deferred taxes | (9) | | | (9) | |
| (17) | | | (16) | |
| (3) | | | (3) | | |
| Depreciation differences | 0 | | | 0 | | | 1 | | | 0 | | | 0 | | | 0 | | |
| | | | | | | | | | | | |
| Renewable and other tax credits | (5) | | (a) | 0 | | | (10) | | (a) | 0 | | | 0 | | | 0 | | |
| State tax | 5 | | | 5 | | | 3 | | | 3 | | | 7 | | | 7 | | |
| Stock-based compensation | 0 | | | (2) | | | 0 | | | 0 | | | 0 | | | 0 | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ameren | | Ameren Missouri | | Ameren Illinois | |
| 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | |
| Effective income tax rate | 12 | % | | 15 | % | | (3) | % | | 7 | % | | 25 | % | | 25 | % | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ameren | | Ameren Missouri | | Ameren Illinois | |
| 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | |
| Three Months | | | | | | | | | | | | |
| Federal statutory corporate income tax rate | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | |
| Increases (decreases) from: | | | | | | | | | | | | |
| Amortization of deferred investment tax credit | (1) | | | (1) | | | (1) | | | (1) | | | — | | | — | | |
| Amortization of excess deferred taxes | (8) | | | (9) | |
| (17) | | | (16) | |
| (2) | | | (3) | | |
| Depreciation differences | — | | | — | | | — | | | — | | | (1) | | | (1) | | |
| | | | | | | | | | | | |
| Renewable and other tax credits | (2) | | (a) | (1) | | | (8) | | (a) | (2) | | | — | | | — | | |
| State tax | 4 | | | 4 | | | 4 | | | 4 | | | 7 | | | 7 | | |
| Stock-based compensation | — | | | 1 | | | — | | | — | | | — | | | — | | |
| | | | | | | | | | | | |
| Effective income tax rate | 14 | % | | 15 | % | | (1) | % | | 6 | % | | 25 | % | | 24 | % | |
| Nine Months | | | | | | | | | | | | |
| Federal statutory corporate income tax rate | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | | 21 | % | |
| Increases (decreases) from: | | | | | | | | | | | | |
| Amortization of deferred investment tax credit | — | | | — | | | — | | | (1) | | | — | | | — | | |
| Amortization of excess deferred taxes | (9) | | | (9) | |
| (17) | | | (16) | |
| (3) | | | (3) | | |
| | | | | | | | | | | | |
| | | | | | | | | | | | |
| Renewable and other tax credits | (3) | | (a) | (1) | | | (8) | | (a) | (1) | | | — | | | — | | |
| State tax | 5 | | | 5 | | | 3 | | | 3 | | | 7 | | | 7 | | |
| Stock-based compensation | (1) | | | (1) | | | — | | | — | | | — | | | — | | |
| | | | | | | | | | | | |
| Effective income tax rate | 13 | % | | 15 | % | | (1) | % | | 6 | % | | 25 | % | | 25 | % | |
(a)Includes production tax credits associated with the High Prairie and Atchison renewable energy centers. Ameren Missouri placed the High Prairie renewable energy center in service as ofin December 2020. Additionally, Ameren Missouri placed in service the wind turbines at its Atchison renewable energy center throughout the first half of 2021. The benefit of the production tax credits associated with Missouri renewable energy standard compliance is refunded to customers through the RESRAM.
NOTE 13 – SUPPLEMENTAL INFORMATION
Cash, Cash Equivalents, and Restricted Cash
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the balance sheets and the statements of cash flows at JuneSeptember 30, 2021, and December 31, 2020:
| | | June 30, 2021 | | | December 31, 2020 | | September 30, 2021 | | | December 31, 2020 |
| Ameren | | Ameren
Missouri | | Ameren
Illinois | | | Ameren | | Ameren
Missouri | | Ameren
Illinois | Ameren | | Ameren
Missouri | | Ameren
Illinois | | | Ameren | | Ameren
Missouri | | Ameren
Illinois |
| “Cash and cash equivalents” | “Cash and cash equivalents” | $ | 99 | | | $ | 0 | | | $ | 96 | | | | $ | 139 | | | $ | 136 | | | $ | 0 | | “Cash and cash equivalents” | $ | 7 | | | $ | — | | | $ | — | | | | $ | 139 | | | $ | 136 | | | $ | — | |
| “Restricted cash” | 131 | | | — | | | 122 | | | | 17 | | | — | | | 6 | | |
| | Restricted cash included in “Other current assets” | Restricted cash included in “Other current assets” | — | | | 4 | | | — | | | | — | | | 5 | | | — | | Restricted cash included in “Other current assets” | 16 | | | 5 | | | 6 | | | | 17 | | | 5 | | | 6 | |
| Restricted cash included in “Other assets” | Restricted cash included in “Other assets” | 24 | | | 0 | | | 24 | | | | 141 | | | 0 | | | 141 | | Restricted cash included in “Other assets” | 116 | | | — | | | 116 | | | | 141 | | | — | | | 141 | |
| Restricted cash included in “Nuclear decommissioning trust fund” | Restricted cash included in “Nuclear decommissioning trust fund” | 13 | | | 13 | | | 0 | | | | 4 | | | 4 | | | 0 | | Restricted cash included in “Nuclear decommissioning trust fund” | 6 | | | 6 | | | — | | | | 4 | | | 4 | | | — | |
| Total cash, cash equivalents, and restricted cash | Total cash, cash equivalents, and restricted cash | $ | 267 | | | $ | 17 | | | $ | 242 | | | | $ | 301 | | | $ | 145 | | | $ | 147 | | Total cash, cash equivalents, and restricted cash | $ | 145 | | | $ | 11 | | | $ | 122 | | | | $ | 301 | | | $ | 145 | | | $ | 147 | |
Restricted cash included in “Other current assets” primarily represents funds held by an irrevocable Voluntary Employee Beneficiary Association (VEBA) trust, which provides health care benefits for active employees. At December 31, 2020, restrictedRestricted cash included in “Other assets” on Ameren’s and Ameren Illinois’ balance sheets primarily represents amounts collected under a cost recovery rider restricted for use in the procurement of renewable energy credits and amounts in a trust fund restricted for the use of funding certain asbestos-related claims. At JuneAs of September 30, 2021, the amounts collected under the cost recovery rider restricted for use in Ameren Illinois’ procurement of renewable energy credits were classified as current asnon-current because the amount is not expected to be refunded to customers within a year.year due to changes to the rider pursuant to the CEJA.
Accounts Receivable
“Accounts receivable – trade” on Ameren’s and Ameren Illinois’ balance sheets include certain receivables purchased at a discount from alternative retail electric suppliers that elect to participate in the utility consolidated billing program. At JuneSeptember 30, 2021, and December 31, 2020, “Other current liabilities” on Ameren’s and Ameren Illinois’ balance sheets included payables for purchased receivables of $30$35 million and $28 million, respectively.
The following table provides a reconciliation of the beginning and ending amount of the allowance for doubtful accounts for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Three Months | | | Six Months | | Three Months | | | Nine Months |
| | 2021 | | 2020 | | | 2021 | | 2020 | | 2021 | | 2020 | | | 2021 | | 2020 |
| Ameren: | Ameren: | | | | Ameren: | | | |
| Beginning of period | Beginning of period | $ | 47 | | | $ | 19 | | | | $ | 50 | | | $ | 17 | | Beginning of period | $ | 42 | | | $ | 25 | | | | $ | 50 | | | $ | 17 | |
| Bad debt expense | Bad debt expense | (3) | | | 7 | | | | 1 | | | 10 | | Bad debt expense | 7 | | | 21 | | | | 8 | | | 31 | |
| | Net write-offs | Net write-offs | (2) | | | (1) | | | | (9) | | | (2) | | Net write-offs | (13) | | | (2) | | | | (22) | | | (4) | |
| | End of period | End of period | $ | 42 | | | $ | 25 | | | | $ | 42 | | | $ | 25 | | End of period | $ | 36 | | | $ | 44 | | | | $ | 36 | | | $ | 44 | |
| Ameren Missouri: | Ameren Missouri: | | | | Ameren Missouri: | | | |
| Beginning of period | Beginning of period | $ | 15 | | | $ | 8 | | | | $ | 16 | | | $ | 7 | | Beginning of period | $ | 16 | | | $ | 9 | | | | $ | 16 | | | $ | 7 | |
| Bad debt expense | Bad debt expense | 2 | | | 2 | | | | 3 | | | 4 | | Bad debt expense | 2 | | | 5 | | | | 5 | | | 9 | |
| | Net write-offs | Net write-offs | (1) | | | (1) | | | | (3) | | | (2) | | Net write-offs | (4) | | | — | | | | (7) | | | (2) | |
| End of period | End of period | $ | 16 | | | $ | 9 | | | | $ | 16 | | | $ | 9 | | End of period | $ | 14 | | | $ | 14 | | | | $ | 14 | | | $ | 14 | |
Ameren Illinois:(a) | Ameren Illinois:(a) | | | | Ameren Illinois:(a) | | | |
| Beginning of period | Beginning of period | $ | 32 | | | $ | 11 | | | | $ | 34 | | | $ | 10 | | Beginning of period | $ | 26 | | | $ | 16 | | | | $ | 34 | | | $ | 10 | |
| Bad debt expense | Bad debt expense | (5) | | (b) | 5 | | | | (2) | | (b) | 6 | | Bad debt expense | 5 | |
| 16 | | | | 3 | | (b) | 22 | |
| | Net write-offs | Net write-offs | (1) | | | 0 | | | | (6) | | | 0 | | Net write-offs | (9) | | | (2) | | | | (15) | | | (2) | |
| | End of period | End of period | $ | 26 | | | $ | 16 | | | | $ | 26 | | | $ | 16 | | End of period | $ | 22 | | | $ | 30 | | | | $ | 22 | | | $ | 30 | |
(a)Ameren Illinois has rate-adjustment mechanisms that allow it to recover the difference between its actual net bad debt write-offs under GAAP, including those associated with receivables purchased from alternative retail electric suppliers, and the amount of net bad debt write-offs included in its base rates.
(b)In the three and sixnine months ended JuneSeptember 30, 2021, Ameren Illinois’ bad debt expense was reduced as a result of incremental state funding received for customer bill assistance. The incremental state funding granted relief to low-income customers at risk of service disconnection resulting from the impacts of the COVID-19 pandemic.
Net write-offs increased for the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period,periods, due to the resumption of disconnection activities for nonpayment. See Note 2 – Rate and Regulatory Matters in this report and under Part II, Item 8, in the Form 10-K for additional information.
Supplemental Cash Flow Information
The following table provides noncash financing and investing activity excluded from the statements of cash flows for the sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | June 30, 2021 | | June 30, 2020 | | September 30, 2021 | | September 30, 2020 |
| Ameren | Ameren
Missouri | | Ameren
Illinois | Ameren | Ameren
Missouri | Ameren
Illinois | | Ameren | Ameren
Missouri | | Ameren
Illinois | Ameren | Ameren
Missouri | Ameren
Illinois |
| Investing | Investing | | | | | | |
| Accrued capital expenditures, including wind generation expenditures | Accrued capital expenditures, including wind generation expenditures | $ | 434 | | $ | 259 | | | $ | 174 | | | $ | 287 | | $ | 111 | | $ | 165 | | Accrued capital expenditures, including wind generation expenditures | $ | 396 | | $ | 209 | | | $ | 182 | | | $ | 311 | | $ | 115 | | $ | 191 | |
| Net realized and unrealized gain (loss) – nuclear decommissioning trust fund | 85 | | 85 | | | 0 | | | (4) | | (4) | | 0 | | |
| Net realized and unrealized gain – nuclear decommissioning trust fund | | Net realized and unrealized gain – nuclear decommissioning trust fund | 85 | | 85 | | | — | | | 43 | | 43 | | — | |
| Financing | Financing | | | | Financing | | | |
| Issuance of common stock for stock-based compensation | Issuance of common stock for stock-based compensation | $ | 33 | | $ | 0 | | | $ | 0 | | | $ | 38 | | $ | 0 | | $ | 0 | | Issuance of common stock for stock-based compensation | $ | 33 | | $ | — | | | $ | — | | | $ | 38 | | $ | — | | $ | — | |
Asset Retirement Obligations
The following table provides a reconciliation of the beginning and ending carrying amount of AROs for the sixnine months ended JuneSeptember 30, 2021:
| | | Ameren
Missouri | | Ameren
Illinois | | | Ameren | | | Ameren
Missouri | | Ameren
Illinois | | | Ameren | |
| Balance at December 31, 2020 | Balance at December 31, 2020 | $ | 751 | |
| $ | 5 | | | (a) | $ | 756 | | (b) | Balance at December 31, 2020 | $ | 751 | |
| $ | 5 | | | (a) | $ | 756 | | (b) |
| Liabilities incurred | Liabilities incurred | 18 | | (c) | 0 | | | | 18 | | (c) | Liabilities incurred | 18 | | (c) | — | | | | 18 | | (c) |
| Liabilities settled | Liabilities settled | (11) | | | 0 | | | | (11) | | | Liabilities settled | (23) | | | — | | | | (23) | | |
| Accretion | Accretion | 15 | | (d) | 0 | | |
| 15 | | (d) | Accretion | 23 | | (d) | — | | |
| 23 | | (d) |
| Change in estimates | Change in estimates | (7) | | (e) | 0 | | | | (7) | | (e) | Change in estimates | (10) | | (e) | — | | | | (10) | | (e) |
| Balance at June 30, 2021 | $ | 766 | |
| $ | 5 | | | (a) | $ | 771 | | (b) | |
| Balance at September 30, 2021 | | Balance at September 30, 2021 | $ | 759 | |
| $ | 5 | | | (a) | $ | 764 | | (b) |
(a)Included in “Other deferred credits and liabilities” on the balance sheet.
(b)Balance included $59 million and $60 million in “Other current liabilities” on the balance sheet as of JuneSeptember 30, 2021, and December 31, 2020, respectively.
(c)During the first sixnine months of 2021, Ameren Missouri recorded an ARO related to the decommissioning of the Atchison Renewable Energy Center.
(d)Accretion expense attributable to Ameren Missouri was recorded as a decrease to regulatory liabilities.
(e)Ameren Missouri changed its fair value estimate primarily due to a decrease in the cost estimate for closure of certain CCR storage facilities.
Stock-based Compensation
On January 1, 2021, Ameren granted 293,058 performance share units with a grant date fair value of $25 million and 125,562 restricted share units with a grant date fair value of $10 million. Awards vest approximately 38 months after the grant date or on a pro-rata basis upon death or eligible retirement. The performance share units vest based on the achievement of certain specified market performance measures (251,177 performance share units) or based on the achievement of renewable generation and energy storage installation targets (41,881 performance share units). The exact number of shares issued pursuant to a performance share unit varies from 0% to 200% of the target award, depending on actual company performance relative to the performance goals.
For the sixnine months ended JuneSeptember 30, 2021 and 2020, excess tax benefits associated with the settlement of stock-based compensation awards reduced income tax expense by $5 million and $8 million, respectively.
Deferred Compensation
As of JuneSeptember 30, 2021, and December 31, 2020, the present value of benefits to be paid for deferred compensation obligations was $91 million and $90 million, respectively, which was primarily reflected in “Other deferred credits and liabilities” on Ameren's consolidated balance sheet.
Operating Revenues
As of JuneSeptember 30, 2021 and 2020, our remaining performance obligations for contracts with a term greater than one year were immaterial. The Ameren Companies elected not to disclose the aggregate amount of the transaction price allocated to the performance obligations that are unsatisfied as of the end of the reporting period for contracts with an initial expected term of one year or less.
See Note 14 – Segment Information for disaggregated revenue information.
Excise Taxes
Ameren Missouri and Ameren Illinois collect from their customers excise taxes, including municipal and state excise taxes and gross receipts taxes that are levied on the sale or distribution of natural gas and electricity. The following table presents the excise taxes recorded on a gross basis in “Operating Revenues – Electric,” “Operating Revenues – Natural gas” and “Operating Expenses – Taxes other than income taxes” on the statements of income for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Three Months | | Six Months | | Three Months | | Nine Months |
| | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Ameren Missouri | Ameren Missouri | $ | 35 | | | $ | 36 | | | $ | 66 | | | $ | 66 | | Ameren Missouri | $ | 54 | | | $ | 45 | | | $ | 120 | | | $ | 111 | |
| Ameren Illinois | Ameren Illinois | 27 | | | 26 | | | 66 | | | 61 | | Ameren Illinois | 27 | | | 26 | | | 93 | | | 87 | |
| Ameren | Ameren | $ | 62 | | | $ | 62 | | | $ | 132 | | | $ | 127 | | Ameren | $ | 81 | | | $ | 71 | | | $ | 213 | | | $ | 198 | |
Earnings per Share
The following table reconciles the basic weighted-average number of common shares outstanding to the diluted weighted-average number of common shares outstanding for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Three Months | | Six Months | | Three Months | | Nine Months |
| | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| | Weighted-average Common Shares Outstanding – Basic | Weighted-average Common Shares Outstanding – Basic | 256.1 | | | 246.9 | | | 255.2 | | | 246.7 | | Weighted-average Common Shares Outstanding – Basic | 257.3 | | | 247.1 | | | 255.9 | | | 246.8 | |
| Assumed settlement of performance share units and restricted stock units | Assumed settlement of performance share units and restricted stock units | 1.1 | | | 1.0 | | | 1.3 | | | 1.0 | | Assumed settlement of performance share units and restricted stock units | 1.3 | | | 1.5 | | | 1.3 | | | 1.2 | |
| Dilutive effect of forward sale agreement | 0 | | | 0 | | | 0 | | | 0.3 | | |
| Dilutive effect of forward sale agreements | | Dilutive effect of forward sale agreements | — | | | 0.6 | | | — | | | 0.4 | |
Weighted-average Common Shares Outstanding – Diluted(a) | Weighted-average Common Shares Outstanding – Diluted(a) | 257.2 | | | 247.9 | | | 256.5 | | | 248.0 | | Weighted-average Common Shares Outstanding – Diluted(a) | 258.6 | | | 249.2 | | | 257.2 | | | 248.4 | |
|
(a)There were 0 potentially dilutivewas an immaterial number of anti-dilutive securities excluded from the earnings per diluted share calculations for the three and sixnine months ended JuneSeptember 30, 20212021.There were no anti-dilutive securities excluded from the earnings per diluted share calculations for the three and nine months ended September 30, 2020.
NOTE 14 – SEGMENT INFORMATION
The following tables present revenues, net income (loss) attributable to common shareholders, and capital expenditures by segment at Ameren and Ameren Illinois for the three and sixnine months ended JuneSeptember 30, 2021 and 2020. Ameren, Ameren Missouri, and Ameren Illinois management review segment capital expenditure information rather than any individual or total asset amount. For additional information about our segments, see Note 16 – Segment Information under Part II, Item 8, of the Form 10-K.
Ameren
| | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | Other | | Intersegment Eliminations | | Ameren | | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | Other | | Intersegment Eliminations | | Ameren | |
| Three Months 2021: | Three Months 2021: | | Three Months 2021: | |
| External revenues | External revenues | $ | 799 | | | $ | 386 | | | $ | 168 | | | $ | 119 | | | $ | — | | | $ | — | | | $ | 1,472 | | | External revenues | $ | 1,118 | | | $ | 425 | | | $ | 127 | | | $ | 141 | | | $ | — | | | $ | — | | | $ | 1,811 | | |
| Intersegment revenues | Intersegment revenues | 10 | | | 2 | | | 0 | | | 17 | | | — | | | (29) | | | — | | | Intersegment revenues | 11 | | | 3 | | | — | | | 19 | | | — | | | (33) | | | — | | |
| Net income (loss) attributable to Ameren common shareholders | Net income (loss) attributable to Ameren common shareholders | 111 | | | 41 | | | 8 | | | 55 | | (a) | (8) | | | — | | | 207 | | | Net income (loss) attributable to Ameren common shareholders | 375 | | | 36 | | | (8) | | | 73 | | (a) | (51) | | | — | | | 425 | | |
| Capital expenditures | Capital expenditures | 567 | | (b) | 129 | | | 61 | | | 131 | | | 0 | | | (12) | | | 876 | | (b) | Capital expenditures | 466 | | (b) | 143 | | | 93 | | | 154 | | | 2 | | | (8) | | | 850 | | (b) |
| Three Months 2020: | Three Months 2020: | | Three Months 2020: | |
| External revenues | External revenues | $ | 782 | | | $ | 352 | | | $ | 140 | | | $ | 124 | | | $ | — | | | $ | — | | | $ | 1,398 | | | External revenues | $ | 990 | | | $ | 390 | | | $ | 122 | | | $ | 126 | | | $ | — | | | $ | — | | | $ | 1,628 | | |
| Intersegment revenues | Intersegment revenues | 10 | | | 0 | | | 0 | | | 12 | | | — | | | (22) | | | — | | | Intersegment revenues | 11 | | | 1 | | | — | | | 15 | | | — | | | (27) | | | — | | |
| Net income (loss) attributable to Ameren common shareholders | Net income (loss) attributable to Ameren common shareholders | 152 | | | 36 | | | 9 | | | 59 | | (a) | (13) | | | — | | | 243 | | | Net income (loss) attributable to Ameren common shareholders | 297 | | | 34 | | | 2 | | | 62 | | (a) | (28) | | | — | | | 367 | | |
| Capital expenditures | Capital expenditures | 238 | | | 139 | | | 79 | | | 135 | | | (1) | | | 2 | | | 592 | | | Capital expenditures | 262 | | | 129 | | | 81 | | | 185 | | | 2 | | | (3) | | | 656 | | |
| Six Months 2021: | | |
| Nine Months 2021: | | Nine Months 2021: | |
| External revenues | External revenues | $ | 1,494 | | | $ | 797 | | | $ | 515 | | | $ | 232 | | | $ | — | | | $ | — | | | $ | 3,038 | | | External revenues | $ | 2,612 | | | $ | 1,222 | | | $ | 642 | | | $ | 373 | | | $ | — | | | $ | — | | | $ | 4,849 | | |
| Intersegment revenues | Intersegment revenues | 19 | | | 2 | | | 0 | | | 34 | | | — | | | (55) | | | — | | | Intersegment revenues | 30 | | | 5 | | | — | | | 53 | | | — | | | (88) | | | — | | |
| Net income attributable to Ameren common shareholders | 158 | | | 87 | | | 83 | | | 102 | | (a) | 10 | | | — | | | 440 | | | |
| Net income (loss) attributable to Ameren common shareholders | | Net income (loss) attributable to Ameren common shareholders | 533 | | | 123 | | | 75 | | | 175 | | (a) | (41) | | | — | | | 865 | | |
| Capital expenditures | Capital expenditures | 1,101 | | (b) | 286 | | | 109 | | | 272 | | | 1 | | | (6) | | | 1,763 | | (b) | Capital expenditures | 1,567 | | (b) | 429 | | | 202 | | | 426 | | | 3 | | | (14) | | | 2,613 | | (b) |
| Six Months 2020: | | |
| Nine Months 2020: | | Nine Months 2020: | |
| External revenues | External revenues | $ | 1,452 | | | $ | 741 | | | $ | 411 | | | $ | 234 | | | $ | — | | | $ | — | | | $ | 2,838 | | | External revenues | $ | 2,442 | | | $ | 1,131 | | | $ | 533 | | | $ | 360 | | | $ | — | | | $ | — | | | $ | 4,466 | | |
| Intersegment revenues | Intersegment revenues | 20 | | | 1 | | | 0 | | | 25 | | | — | | | (46) | | | — | | | Intersegment revenues | 31 | | | 2 | | | — | | | 40 | | | — | | | (73) | | | — | | |
| Net income attributable to Ameren common shareholders | 142 | | | 73 | | | 64 | | | 106 | | (a) | 4 | | | — | | | 389 | | | |
| Net income (loss) attributable to Ameren common shareholders | | Net income (loss) attributable to Ameren common shareholders | 439 | | | 107 | | | 66 | | | 168 | | (a) | (24) | | | — | | | 756 | | |
| Capital expenditures | Capital expenditures | 516 | | | 262 | | | 140 | | | 305 | | | 2 | | | 3 | | | 1,228 | | | Capital expenditures | 778 | | | 391 | | | 221 | | | 490 | | | 4 | | | — | | | 1,884 | | |
(a)Ameren Transmission earnings reflect an allocation of financing costs from Ameren (parent).
(b)Includes $224$98 million and $417$515 million at Ameren and Ameren Missouri for wind generation expenditures for the three and sixnine months ended JuneSeptember 30, 2021, respectively.
Ameren Illinois
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Intersegment Eliminations | | Ameren Illinois |
| Three Months 2021: | | | | | | | | | |
| External revenues | $ | 388 | | | $ | 168 | | | $ | 73 | | | $ | — | | | $ | 629 | |
| Intersegment revenues | 0 | | | 0 | | | 15 | | | (15) | | | — | |
| Net income available to common shareholder | 41 | | | 8 | | | 37 | | | — | | | 86 | |
| Capital expenditures | 129 | | | 61 | | | 119 | | | — | | | 309 | |
| Three Months 2020: | | | | | | | | | |
| External revenues | $ | 352 | | | $ | 140 | | | $ | 75 | | | $ | — | | | $ | 567 | |
| Intersegment revenues | 0 | | | 0 | | | 12 | | | (12) | | | — | |
| Net income available to common shareholder | 36 | | | 9 | | | 38 | | | — | | | 83 | |
| Capital expenditures | 139 | | | 79 | | | 119 | | | — | | | 337 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Intersegment Eliminations | | Ameren Illinois |
| Six Months 2021: | | | | | | | | | |
| External revenues | $ | 799 | | | $ | 515 | | | $ | 138 | | | $ | — | | | $ | 1,452 | |
| Intersegment revenues | 0 | | | 0 | | | 31 | | | (31) | | | — | |
| Net income available to common shareholder | 87 | | | 83 | | | 65 | | | — | | | 235 | |
| Capital expenditures | 286 | | | 109 | | | 251 | | | — | | | 646 | |
| Six Months 2020: | | | | | | | | | |
| External revenues | $ | 742 | | | $ | 411 | | | $ | 137 | | | $ | — | | | $ | 1,290 | |
| Intersegment revenues | 0 | | | 0 | | | 24 | | | (24) | | | — | |
| Net income available to common shareholder | 73 | | | 64 | | | 66 | | | — | | | 203 | |
| Capital expenditures | 262 | | | 140 | | | 259 | | | — | | | 661 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Intersegment Eliminations | | Ameren Illinois |
| Three Months 2021: | | | | | | | | | |
| External revenues | $ | 428 | | | $ | 127 | | | $ | 90 | | | $ | — | | | $ | 645 | |
| Intersegment revenues | — | | | — | | | 18 | | | (18) | | | — | |
| Net income (loss) available to common shareholder | 36 | | | (8) | | | 51 | | | — | | | 79 | |
| Capital expenditures | 143 | | | 93 | | | 144 | | | — | | | 380 | |
| Three Months 2020: | | | | | | | | | |
| External revenues | $ | 391 | | | $ | 122 | | | $ | 76 | | | $ | — | | | $ | 589 | |
| Intersegment revenues | — | | | — | | | 15 | | | (15) | | | — | |
| Net income available to common shareholder | 34 | | | 2 | | | 41 | | | — | | | 77 | |
| Capital expenditures | 129 | | | 81 | | | 160 | | | — | | | 370 | |
| Nine Months 2021: | | | | | | | | | |
| External revenues | $ | 1,227 | | | $ | 642 | | | $ | 228 | | | $ | — | | | $ | 2,097 | |
| Intersegment revenues | — | | | — | | | 49 | | | (49) | | | — | |
| Net income available to common shareholder | 123 | | | 75 | | | 116 | | | — | | | 314 | |
| Capital expenditures | 429 | | | 202 | | | 395 | | | — | | | 1,026 | |
| Nine Months 2020: | | | | | | | | | |
| External revenues | $ | 1,133 | | | $ | 533 | | | $ | 213 | | | $ | — | | | $ | 1,879 | |
| Intersegment revenues | — | | | — | | | 39 | | | (39) | | | — | |
| Net income available to common shareholder | 107 | | | 66 | | | 107 | | | — | | | 280 | |
| Capital expenditures | 391 | | | 221 | | | 419 | | | — | | | 1,031 | |
The following tables present disaggregated revenues by segment at Ameren and Ameren Illinois for the three and sixnine months ended JuneSeptember 30, 2021 and 2020. Economic factors affect the nature, timing, amount, and uncertainty of revenues and cash flows in a similar manner across customer classes. Revenues from alternative revenue programs have a similar distribution among customer classes as revenues from contracts with customers. Other revenues not associated with contracts with customers are presented in the Other customer classification, along with electric transmission and off-system revenues.
Ameren
| | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | | Intersegment Eliminations | | Ameren | | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | | Intersegment Eliminations | | Ameren | |
| Three Months 2021: | Three Months 2021: | | | | Three Months 2021: | | | |
| Residential | Residential | $ | 328 | | | $ | 218 | | | $ | 0 | | | $ | 0 | | | | $ | 0 | | | $ | 546 | | | Residential | $ | 537 | | | $ | 258 | | | $ | — | | | $ | — | | | | $ | — | | | $ | 795 | | |
| Commercial | Commercial | 271 | | | 127 | | | 0 | | | 0 | | | | 0 | | | 398 | | | Commercial | 412 | | | 143 | | | — | | | — | | | | — | | | 555 | | |
| Industrial | Industrial | 71 | | | 34 | | | 0 | | | 0 | | | | 0 | | | 105 | | | Industrial | 98 | | | 26 | | | — | | | — | | | | — | | | 124 | | |
| Other | Other | 119 | | | 9 | |
| 0 | | | 136 | | | | (29) | | | 235 | | | Other | 66 | | | 1 | |
| — | | | 160 | | | | (33) | | | 194 | | |
| Total electric revenues | Total electric revenues | $ | 789 | | | $ | 388 | | | $ | 0 | | | $ | 136 | | | | $ | (29) | | | $ | 1,284 | | | Total electric revenues | $ | 1,113 | | | $ | 428 | | | $ | — | | | $ | 160 | | | | $ | (33) | | | $ | 1,668 | | |
| Residential | Residential | $ | 11 | | | $ | 0 | | | $ | 112 | | | $ | 0 | | | | $ | 0 | | | $ | 123 | | | Residential | $ | 9 | | | $ | — | | | $ | 75 | | | $ | — | | | | $ | — | | | $ | 84 | | |
| Commercial | Commercial | 4 | | | 0 | | | 29 | | | 0 | | | | 0 | | | 33 | | | Commercial | 4 | | | — | | | 23 | | | — | | | | — | | | 27 | | |
| Industrial | Industrial | 1 | | | 0 | | | 3 | | | 0 | | | | 0 | | | 4 | | | Industrial | — | | | — | | | 3 | | | — | | | | — | | | 3 | | |
| Other | Other | 4 | | | 0 | | | 24 | |
| 0 | | | | 0 | | | 28 | | | Other | 3 | | | — | | | 26 | |
| — | | | | — | | | 29 | | |
| Total natural gas revenues | Total natural gas revenues | $ | 20 | | | $ | 0 | | | $ | 168 | | | $ | 0 | | | | $ | 0 | | | $ | 188 | | | Total natural gas revenues | $ | 16 | | | $ | — | | | $ | 127 | | | $ | — | | | | $ | — | | | $ | 143 | | |
Total revenues(a) | Total revenues(a) | $ | 809 | | | $ | 388 | | | $ | 168 | | | $ | 136 | | | | $ | (29) | | | $ | 1,472 | | | Total revenues(a) | $ | 1,129 | | | $ | 428 | | | $ | 127 | | | $ | 160 | | | | $ | (33) | | | $ | 1,811 | | |
| Three Months 2020: | | | | |
| Residential | $ | 359 | | | $ | 210 | | | $ | 0 | | | $ | 0 | | | | $ | 0 | | | $ | 569 | | | |
| Commercial | 264 | | | 112 | | | 0 | | | 0 | | | | 0 | | | 376 | | | |
| Industrial | 67 | | | 30 | | | 0 | | | 0 | | | | 0 | | | 97 | | | |
| Other | 81 | |
| 0 | | | 0 | | | 136 | | | | (22) | | | 195 | |
| |
| Total electric revenues | $ | 771 | | | $ | 352 | | | $ | 0 | | | $ | 136 | | | | $ | (22) | | | $ | 1,237 | | | |
| Residential | $ | 11 | | | $ | 0 | | | $ | 94 | | | $ | 0 | | | | $ | 0 | | | $ | 105 | | | |
| Commercial | 4 | | | 0 | | | 22 | | | 0 | | | | 0 | | | 26 | | | |
| Industrial | 1 | | | 0 | | | 3 | | | 0 | | | | 0 | | | 4 | | | |
| Other | 5 | | | 0 | | | 21 | | | 0 | | | | 0 | | | 26 | | | |
| Total natural gas revenues | $ | 21 | | | $ | 0 | | | $ | 140 | | | $ | 0 | | | | $ | 0 | | | $ | 161 | | | |
Total revenues(a) | $ | 792 | | | $ | 352 | | | $ | 140 | | | $ | 136 | | | | $ | (22) | | | $ | 1,398 | | | |
| | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | | Intersegment Eliminations | | Ameren | | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | | Intersegment Eliminations | | Ameren | |
| Six Months 2021: | | | | |
| Three Months 2020: | | Three Months 2020: | | | |
| Residential | Residential | $ | 640 | | | $ | 447 | | | $ | 0 | | | $ | 0 | | | | $ | 0 | | | $ | 1,087 | | | Residential | $ | 455 | | | $ | 234 | | | $ | — | | | $ | — | | | | $ | — | | | $ | 689 | | |
| Commercial | Commercial | 487 | | | 259 | | | 0 | | | 0 | | | | 0 | | | 746 | | | Commercial | 343 | | | 127 | | | — | | | — | | | | — | | | 470 | | |
| Industrial | Industrial | 123 | | | 68 | | | 0 | | | 0 | | | | 0 | | | 191 | | | Industrial | 87 | | | 26 | | | — | | | — | | | | — | | | 113 | | |
| Other | Other | 180 | | | 25 | | | 0 | | | 266 | | | | (55) | | | 416 | | | Other | 99 | |
| 4 | | | — | | | 141 | | | | (27) | | | 217 | |
|
| Total electric revenues | Total electric revenues | $ | 1,430 | | | $ | 799 | | | $ | 0 | | | $ | 266 | | | | $ | (55) | | | $ | 2,440 | | | Total electric revenues | $ | 984 | | | $ | 391 | | | $ | — | | | $ | 141 | | | | $ | (27) | | | $ | 1,489 | | |
| Residential | Residential | $ | 45 | | | $ | 0 | | | $ | 363 | | | $ | 0 | | | | $ | 0 | | | $ | 408 | | | Residential | $ | 8 | | | $ | — | | | $ | 68 | | | $ | — | | | | $ | — | | | $ | 76 | | |
| Commercial | Commercial | 19 | | | 0 | | | 93 | | | 0 | | | | 0 | | | 112 | | | Commercial | 3 | | | — | | | 18 | | | — | | | | — | | | 21 | | |
| Industrial | Industrial | 2 | | | 0 | | | 17 | | | 0 | | | | 0 | | | 19 | | | Industrial | 1 | | | — | | | 5 | | | — | | | | — | | | 6 | | |
| Other | Other | 17 | | | 0 | | | 42 | | | 0 | | | | 0 | | | 59 | | | Other | 5 | | | — | | | 31 | | | — | | | | — | | | 36 | | |
| Total natural gas revenues | Total natural gas revenues | $ | 83 | | | $ | 0 | | | $ | 515 | | | $ | 0 | | | | $ | 0 | | | $ | 598 | | | Total natural gas revenues | $ | 17 | | | $ | — | | | $ | 122 | | | $ | — | | | | $ | — | | | $ | 139 | | |
Total revenues(a) | Total revenues(a) | $ | 1,513 | | | $ | 799 | | | $ | 515 | | | $ | 266 | | | | $ | (55) | | | $ | 3,038 | | | Total revenues(a) | $ | 1,001 | | | $ | 391 | | | $ | 122 | | | $ | 141 | | | | $ | (27) | | | $ | 1,628 | | |
| Six Months 2020: | | | | |
| Nine Months 2021: | | Nine Months 2021: | | | |
| Residential | Residential | $ | 656 | | | $ | 430 | | | $ | 0 | | | $ | 0 | | | | $ | 0 | | | $ | 1,086 | | | Residential | $ | 1,177 | | | $ | 705 | | | $ | — | | | $ | — | | | | $ | — | | | $ | 1,882 | | |
| Commercial | Commercial | 485 | | | 238 | | | 0 | | | 0 | | | | 0 | | | 723 | | | Commercial | 899 | | | 402 | | | — | | | — | | | | — | | | 1,301 | | |
| Industrial | Industrial | 120 | | | 65 | | | 0 | | | 0 | | | | 0 | | | 185 | | | Industrial | 221 | | | 94 | | | — | | | — | | | | — | | | 315 | | |
| Other | Other | 141 | | | 9 | | | 0 | | | 259 | | | | (46) | | | 363 | | | Other | 246 | | | 26 | | | — | | | 426 | | | | (88) | | | 610 | | |
| Total electric revenues | Total electric revenues | $ | 1,402 | | | $ | 742 | | | $ | 0 | | | $ | 259 | | | | $ | (46) | | | $ | 2,357 | | | Total electric revenues | $ | 2,543 | | | $ | 1,227 | | | $ | — | | | $ | 426 | | | | $ | (88) | | | $ | 4,108 | | |
| Residential | Residential | $ | 44 | | | $ | 0 | | | $ | 307 | | | $ | 0 | | | | $ | 0 | | | $ | 351 | | | Residential | $ | 54 | | | $ | — | | | $ | 438 | | | $ | — | | | | $ | — | | | $ | 492 | | |
| Commercial | Commercial | 17 | | | 0 | | | 76 | | | 0 | | | | 0 | | | 93 | | | Commercial | 23 | | | — | | | 116 | | | — | | | | — | | | 139 | | |
| Industrial | Industrial | 2 | | | 0 | | | 6 | | | 0 | | | | 0 | | | 8 | | | Industrial | 2 | | | — | | | 20 | | | — | | | | — | | | 22 | | |
| Other | Other | 7 | | | 0 | | | 22 | | | 0 | | | | 0 | | | 29 | | | Other | 20 | | | — | | | 68 | | | — | | | | — | | | 88 | | |
| Total natural gas revenues | Total natural gas revenues | $ | 70 | | | $ | 0 | | | $ | 411 | | | $ | 0 | | | | $ | 0 | | | $ | 481 | | | Total natural gas revenues | $ | 99 | | | $ | — | | | $ | 642 | | | $ | — | | | | $ | — | | | $ | 741 | | |
Total revenues(a) | Total revenues(a) | $ | 1,472 | | | $ | 742 | | | $ | 411 | | | $ | 259 | | | | $ | (46) | | | $ | 2,838 | | | Total revenues(a) | $ | 2,642 | | | $ | 1,227 | | | $ | 642 | | | $ | 426 | | | | $ | (88) | | | $ | 4,849 | | |
| Nine Months 2020: | | Nine Months 2020: | | | |
| Residential | | Residential | $ | 1,111 | | | $ | 664 | | | $ | — | | | $ | — | | | | $ | — | | | $ | 1,775 | | |
| Commercial | | Commercial | 828 | | | 365 | | | — | | | — | | | | — | | | 1,193 | | |
| Industrial | | Industrial | 207 | | | 91 | | | — | | | — | | | | — | | | 298 | | |
| Other | | Other | 240 | | | 13 | | | — | | | 400 | | | | (73) | | | 580 | | |
| Total electric revenues | | Total electric revenues | $ | 2,386 | | | $ | 1,133 | | | $ | — | | | $ | 400 | | | | $ | (73) | | | $ | 3,846 | | |
| Residential | | Residential | $ | 52 | | | $ | — | | | $ | 375 | | | $ | — | | | | $ | — | | | $ | 427 | | |
| Commercial | | Commercial | 20 | | | — | | | 94 | | | — | | | | — | | | 114 | | |
| Industrial | | Industrial | 3 | | | — | | | 11 | | | — | | | | — | | | 14 | | |
| Other | | Other | 12 | | | — | | | 53 | | | — | | | | — | | | 65 | | |
| Total natural gas revenues | | Total natural gas revenues | $ | 87 | | | $ | — | | | $ | 533 | | | $ | — | | | | $ | — | | | $ | 620 | | |
Total revenues(a) | | Total revenues(a) | $ | 2,473 | | | $ | 1,133 | | | $ | 533 | | | $ | 400 | | | | $ | (73) | | | $ | 4,466 | | |
(a)The following table presents increases/(decreases) in revenues from alternative revenue programs and other revenues not from contracts with customers for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | Ameren | | | Ameren Missouri | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Transmission | | Ameren | |
| Three Months 2021: | Three Months 2021: | | Three Months 2021: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | (5) | | | $ | 34 | | | $ | 2 | | | $ | 5 | | | $ | 36 | | | Revenues from alternative revenue programs | $ | 6 | | | $ | (97) | | | $ | (5) | | | $ | 1 | | | $ | (95) | | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 66 | | (a) | 0 | | | 1 | | | 0 | | | 67 | | (a) | Other revenues not from contracts with customers | 7 | | (a) | 6 | | | — | | | — | | | 13 | | (a) |
| | Three Months 2020: | Three Months 2020: | | Three Months 2020: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | (6) | | | $ | 5 | | | $ | 3 | | | $ | 18 | | | $ | 20 | | | Revenues from alternative revenue programs | $ | 1 | | | $ | (110) | | | $ | 3 | | | $ | 4 | | | $ | (102) | | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 7 | | | 0 | | | 0 | | | 0 | | | 7 | | | Other revenues not from contracts with customers | 6 | | | 5 | | | — | | | — | | | 11 | | |
| | Six Months 2021: | | |
| Nine Months 2021: | | Nine Months 2021: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | (15) | | | $ | 95 | | | $ | 5 | | | $ | 4 | | | $ | 89 | | | Revenues from alternative revenue programs | $ | (9) | | | $ | (2) | | | $ | — | | | $ | 5 | | | $ | (6) | | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 64 | | (a) | 3 | | | 2 | | | 0 | | | 69 | | (a) | Other revenues not from contracts with customers | 71 | | (a) | 9 | | | 2 | | | — | | | 82 | | (a) |
| | Six Months 2020: | | |
| Nine Months 2020: | | Nine Months 2020: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | (9) | | | $ | 51 | | | $ | 14 | | | $ | 30 | | | $ | 86 | | | Revenues from alternative revenue programs | $ | (8) | | | $ | (59) | | | $ | 17 | | | $ | 34 | | | $ | (16) | | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 15 | | | 1 | | | 1 | | | 0 | | | 17 | | | Other revenues not from contracts with customers | 21 | | | 6 | | | 1 | | | — | | | 28 | | |
|
(a)Includes insurance recoveries related to lost sales associated with the Callaway Energy Center maintenance outage. See Note 10 – Callaway Energy Center for additional information.
Ameren Illinois
| | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Intersegment Eliminations | | Ameren Illinois | | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Intersegment Eliminations | | Ameren Illinois | |
| Three Months 2021: | Three Months 2021: | | Three Months 2021: | |
| Residential | Residential | $ | 218 | | | $ | 112 | | | $ | 0 | | | $ | 0 | | | $ | 330 | | | Residential | $ | 258 | | | $ | 75 | | | $ | — | | | $ | — | | | $ | 333 | | |
| Commercial | Commercial | 127 | | | 29 | | | 0 | | | 0 | | | 156 | | | Commercial | 143 | | | 23 | | | — | | | — | | | 166 | | |
| Industrial | Industrial | 34 | | | 3 | | | 0 | | | 0 | | | 37 | | | Industrial | 26 | | | 3 | | | — | | | — | | | 29 | | |
| Other | Other | 9 | |
| 24 | |
| 88 | | | (15) | | | 106 | | | Other | 1 | |
| 26 | |
| 108 | | | (18) | | | 117 | | |
Total revenues(a) | Total revenues(a) | $ | 388 | | | $ | 168 | | | $ | 88 | | | $ | (15) | | | $ | 629 | | | Total revenues(a) | $ | 428 | | | $ | 127 | | | $ | 108 | | | $ | (18) | | | $ | 645 | | |
| Three Months 2020: | Three Months 2020: | | Three Months 2020: | |
| Residential | Residential | $ | 210 | | | $ | 94 | | | $ | 0 | | | $ | 0 | | | $ | 304 | | | Residential | $ | 234 | | | $ | 68 | | | $ | — | | | $ | — | | | $ | 302 | | |
| Commercial | Commercial | 112 | | | 22 | | | 0 | | | 0 | | | 134 | | | Commercial | 127 | | | 18 | | | — | | | — | | | 145 | | |
| Industrial | Industrial | 30 | | | 3 | | | 0 | | | 0 | | | 33 | | | Industrial | 26 | | | 5 | | | — | | | — | | | 31 | | |
| Other | Other | 0 | | | 21 | | | 87 | | | (12) | | | 96 | | | Other | 4 | | | 31 | | | 91 | | | (15) | | | 111 | | |
Total revenues(a) | Total revenues(a) | $ | 352 | | | $ | 140 | | | $ | 87 | | | $ | (12) | | | $ | 567 | | | Total revenues(a) | $ | 391 | | | $ | 122 | | | $ | 91 | | | $ | (15) | | | $ | 589 | | |
| Six Months 2021: | | |
| Nine Months 2021: | | Nine Months 2021: | |
| Residential | Residential | $ | 447 | | | $ | 363 | | | $ | 0 | | | $ | 0 | | | $ | 810 | | | Residential | $ | 705 | | | $ | 438 | | | $ | — | | | $ | — | | | $ | 1,143 | | |
| Commercial | Commercial | 259 | | | 93 | | | 0 | | | 0 | | | 352 | | | Commercial | 402 | | | 116 | | | — | | | — | | | 518 | | |
| Industrial | Industrial | 68 | | | 17 | | | 0 | | | 0 | | | 85 | | | Industrial | 94 | | | 20 | | | — | | | — | | | 114 | | |
| Other | Other | 25 | | | 42 | | | 169 | | | (31) | | | 205 | | | Other | 26 | | | 68 | | | 277 | | | (49) | | | 322 | | |
Total revenues(a) | Total revenues(a) | $ | 799 | | | $ | 515 | | | $ | 169 | | | $ | (31) | | | $ | 1,452 | | | Total revenues(a) | $ | 1,227 | | | $ | 642 | | | $ | 277 | | | $ | (49) | | | $ | 2,097 | | |
| Six Months 2020: | | |
| Nine Months 2020: | | Nine Months 2020: | |
| Residential | Residential | $ | 430 | | | $ | 307 | | | $ | 0 | | | $ | 0 | | | $ | 737 | | | Residential | $ | 664 | | | $ | 375 | | | $ | — | | | $ | — | | | $ | 1,039 | | |
| Commercial | Commercial | 238 | | | 76 | | | 0 | | | 0 | | | 314 | | | Commercial | 365 | | | 94 | | | — | | | — | | | 459 | | |
| Industrial | Industrial | 65 | | | 6 | | | 0 | | | 0 | | | 71 | | | Industrial | 91 | | | 11 | | | — | | | — | | | 102 | | |
| Other | Other | 9 | | | 22 | | | 161 | | | (24) | | | 168 | | | Other | 13 | | | 53 | | | 252 | | | (39) | | | 279 | | |
Total revenues(a) | Total revenues(a) | $ | 742 | | | $ | 411 | | | $ | 161 | | | $ | (24) | | | $ | 1,290 | | | Total revenues(a) | $ | 1,133 | | | $ | 533 | | | $ | 252 | | | $ | (39) | | | $ | 1,879 | | |
(a)The following table presents increases/(decreases) in revenues from alternative revenue programs and other revenues not from contracts with customers for the Ameren Illinois segments for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Ameren Illinois | | Ameren Illinois Electric Distribution | | Ameren Illinois Natural Gas | | Ameren Illinois Transmission | | Ameren Illinois |
| Three Months 2021: | Three Months 2021: | | Three Months 2021: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | 34 | | | $ | 2 | | | $ | 2 | | | $ | 38 | | Revenues from alternative revenue programs | $ | (97) | | | $ | (5) | | | $ | 3 | | | $ | (99) | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 0 | | | 1 | | | 0 | | | 1 | | Other revenues not from contracts with customers | 6 | | | — | | | — | | | 6 | |
| | Three Months 2020: | Three Months 2020: | | Three Months 2020: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | 5 | | | $ | 3 | | | $ | 14 | | | $ | 22 | | Revenues from alternative revenue programs | $ | (110) | | | $ | 3 | | | $ | 5 | | | $ | (102) | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 0 | | | 0 | | | 0 | | | 0 | | Other revenues not from contracts with customers | 5 | | | — | | | — | | | 5 | |
| | Six Months 2021: | | |
| Nine Months 2021: | | Nine Months 2021: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | 95 | | | $ | 5 | | | $ | 1 | | | $ | 101 | | Revenues from alternative revenue programs | $ | (2) | | | $ | — | | | $ | 4 | | | $ | 2 | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 3 | | | 2 | | | 0 | | | 5 | | Other revenues not from contracts with customers | 9 | | | 2 | | | — | | | 11 | |
| | Six Months 2020: | | |
| Nine Months 2020: | | Nine Months 2020: | |
| Revenues from alternative revenue programs | Revenues from alternative revenue programs | $ | 51 | | | $ | 14 | | | $ | 24 | | | $ | 89 | | Revenues from alternative revenue programs | $ | (59) | | | $ | 17 | | | $ | 29 | | | $ | (13) | |
| Other revenues not from contracts with customers | Other revenues not from contracts with customers | 1 | | | 1 | | | 0 | | | 2 | | Other revenues not from contracts with customers | 6 | | | 1 | | | — | | | 7 | |
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ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The following discussion should be read in conjunction with the financial statements and Risk Factors contained in this Form 10-Q, as well as Management’s Discussion and Analysis of Financial Condition and Results of Operations and Risk Factors contained in the Form 10-K. We intend for this discussion to provide the reader with information that will assist in understanding our financial statements, the changes in certain key items in those financial statements, and the primary factors that accounted for those changes, as well as how certain accounting principles affect our financial statements. The discussion also provides information about the financial results of our business segments to provide a better understanding of how those segments and their results affect the financial condition and results of operations of Ameren as a whole. Also see the Glossary of Terms and Abbreviations at the front of this report and in the Form 10-K.
Ameren, headquartered in St. Louis, Missouri, is a public utility holding company whose primary assets are its equity interests in its subsidiaries. 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. Ameren has other subsidiaries that conduct other activities, such as providing shared services.
•Union Electric Company, doing business as Ameren Missouri, operates a rate-regulated electric generation, transmission, and distribution business and a rate-regulated natural gas distribution business in Missouri.
•Ameren Illinois Company, doing business as Ameren Illinois, operates rate-regulated electric transmission, electric distribution, and natural gas distribution businesses in Illinois.
•ATXI operates a FERC rate-regulated electric transmission business in the MISO.
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. All tabular dollar amounts are in millions, unless otherwise indicated.
In addition to presenting results of operations and earnings amounts in total, we present certain information in cents per share. These amounts reflect factors that directly affect Ameren’s earnings. We believe this per share information helps readers to understand the impact of these factors on Ameren’s earnings per share.
OVERVIEW
Net income attributable to Ameren common shareholders in the three months ended JuneSeptember 30, 2021, was $207$425 million, or $0.80$1.65 per diluted share, compared with $243$367 million, or $0.98$1.47 per diluted share, in the year-ago period. Net income attributable to common shareholders in the sixnine months ended JuneSeptember 30, 2021, was $440$865 million, or $1.71$3.36 per diluted share, compared with $389$756 million, or $1.57$3.04 per diluted share, in the year-ago period. Net income for the three and sixnine months ended JuneSeptember 30, 2021, compared to the year-ago periods, was favorably affected by increased infrastructure investments at Ameren Missouri, Ameren Transmission, and Ameren Illinois Electric Distribution; increased Ameren Missouri electric retail sales, primarily resulting from colder winter temperatures experienced in 2021;improving economic conditions and the effects of weather; higher delivery service rates at Ameren Illinois Natural Gas; and a higher recognized ROE at Ameren Illinois Electric Distribution. Net income for the sixthree months ended JuneSeptember 30, 2021, compared to the year-ago period, was also favorably affected by the results of Ameren Missouri’s March 2020 electric rate order, and lower other operations and maintenance expenses not subject to riders or regulatory tracking mechanisms, primarily due to disciplined cost management and changes in the value of company-owned life insurance. Earnings for the three and six months ended June 30, 2021, compared to the year-ago periods, were unfavorably affected by a change in rate design at Ameren Missouri, which resulted in lessmore revenues in the secondthird quarter of 2021 due to a change in the timing of transition from summer to winter volumetric rates. Net income for the nine months ended September 30, 2021, compared to summer volumetric rates;the year-ago period, was favorably affected by the results of Ameren Missouri’s March 2020 electric rate order. Earnings for the three and nine months ended September 30, 2021, compared to the year-ago periods, were unfavorably affected by the effect of dilution; and the absence in 2021 of the FERC’s May 2020 order addressing the allowed base ROE for FERC regulated transmission rate base under the MISO tariff, which increased earnings in the year-ago periods. The earnings comparisons were also unfavorably affected by higher other operations and maintenance expenses at Ameren Missouri due to the amortization of expenses, beginning in January 2021, related to the 2020 scheduled refueling and maintenance outage at the Callaway Energy Center pursuant to the MoPSC’s February 2020 order.order; increased financing costs at Ameren Missouri and Ameren (parent), primarily due to higher long-term debt balances; increased depreciation and amortization expenses not recoverable under riders or trackers at Ameren Missouri and Ameren Illinois Natural Gas, primarily due to additional property, plant, and equipment investments; and decreased income tax benefit at Ameren (parent), due to decreased interim period income tax benefits in 2021, largely related to wind generation facilities. Net income for the sixthree months ended JuneSeptember 30, 2021, compared to the year-ago period, was also unfavorably affected by a change in rate design at Ameren Illinois Natural Gas, which concentrates more revenues in the winter heating season due to an increase in volumetric rates. Net income for the nine months ended September 30, 2021, compared to the year-ago period, was unfavorably affected by the absence in 2021 of the FERC’s May 2020 order addressing the allowed base ROE for FERC regulated transmission rate base under the MISO tariff, which increased earnings in the year-ago period, and the result of the FERC’s March 2021 order, primarily related to the historical recovery of materials and supplies inventories.
Ameren’s strategic plan includes investing and operating its utilities in a manner consistent with existing regulatory frameworks, enhancing those frameworks, and advocating for responsible energy and economic policies, as well as creating and capitalizing on opportunities for investment for the benefit of its customers, shareholders, and the environment. Ameren remains focused on disciplined cost management and strategic capital allocation. Ameren invested $1.8$2.6 billion in its rate-regulated businesses in the sixnine months ended JuneSeptember 30, 2021.
The COVID-19 pandemic continues to affect our results of operations, financial position, and liquidity, but we continue to expect gradual improvement in sales volumes in 2021, compared to 2020. In the first sixnine months of 2021, our sales volumes, excluding the estimated effects of weather and customer energy-efficiency programs, increased compared to the same period in 2020. However, our accounts receivable balances that were past due or that were a part of a deferred payment arrangement are higher than normal historical levels, as customer payments have been affected. The continued effect of the COVID-19 pandemic on our results of operations, financial position, and liquidity in subsequent periods will depend on its severity and longevity, future regulatory or legislative actions with respect thereto, and the resulting impact on business, economic, and capital market conditions. InIn general, restrictions on social activities and nonessential businesses implemented in our service territories in 2020 have been relaxed. However, additional restrictions may be imposed in the future.relaxed. We continue to assess the impacts the COVID-19 pandemic is
having on our businesses, including impacts on electric and natural gas sales volumes, liquidity, bad debt expense, and supply chain operations. For further discussion of these and other matters discussed below, see Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report, and Results of Operations, Liquidity and Capital Resources, and Outlook sections below. In addition, for information regarding Ameren Illinois’ suspension and subsequent reinstatement of customer disconnection
activities and late fee charges for nonpayment, see Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report and under Part II, Item 8, of the Form 10-K.10-K.
Due to extremely cold winter weather in mid-February 2021, Ameren Missouri and Ameren Illinois experienced higher than anticipated commodity costs for purchased power and natural gas purchased for resale and purchased power, which contributed to the acceleration of the timing of certain planned 2021 debt issuances. Ameren Missouri and Ameren Illinois have cost recovery mechanisms in place that provide recovery of the higher purchased power and natural gas costs and purchased power from customers over periods of time established under the applicable mechanisms.
In January 2021, Ameren Missouri acquired a 300-MW300-MW wind generation project located in northwestern Missouri. As of June 30, 2021, Ameren Missouri had placed the project in service as the Atchison Renewable Energy Center. The purchase price of the energy center was approximately $500 million, including an immaterial amount of transaction costs. The Atchison Renewable Energy Center will support Ameren Missouri’s compliance with the Missouri renewable energy standard.
In February 2021, Ameren Missouri filed an update to its Smart Energy Plan with the MoPSC, which includes a five-year capital investment overview with a detailed one-year plan for 2021. The plan is designed to upgrade Ameren Missouri’s electric infrastructure and includes investments that will upgrade the grid and accommodate more renewable energy. Investments under the plan are expected to total approximately $8.4 billion over the five-year period from 2021 through 2025, with expenditures largely recoverable under the PISA and the RESRAM. The planned investments in 2024 and 2025 are based on the assumption that Ameren Missouri requests and receives MoPSC approval of an extension of the PISA through December 2028.
In March 2021, Ameren Missouri filed requests with the MoPSC seeking approval to increase its annual revenues for electric service by $299 million and for natural gas delivery service by $299 million and $9 million.million, respectively. The electric rate increase request is based on a 9.9% ROE, a capital structure composed of 51.9% common equity, a rate base of $10.0 billion and a test year ended December 31, 2020, with certain pro-forma adjustments expected through a true-up date of September 30, 2021. In October 2021, the MoPSC staff recommended increases to Ameren Missouri's annual electric service and natural gas delivery revenues of $188 million and $4 million, respectively. The MoPSC proceedings relating tostaff’s recommended electric service revenue increase is based on a 9.5% ROE, a capital structure composed of 50.32% common equity, which was Ameren Missouri’s June 2021 capital structure, and a rate base of $10.0 billion. Ameren Missouri anticipates that the proposed rate changesMoPSC staff will take place overupdate its recommendation for Ameren Missouri’s September 2021 capital structure. The MoPSC staff’s recommendation also includes lower depreciation, primarily on distribution investments, than reflected in Ameren Missouri’s request, and a period of up to 11 months, with a decisionlower estimated headcount, resulting in lower payroll and benefit costs, among other things. Decisions by the MoPSC are expected by Februarymid-February 2022, andwith new rates effective by late February 2022.
In March 2021, the MoPSC issued orders approving nonunanimous stipulation and agreements related to Ameren Missouri’s electric and natural gas service accounting authority order requests. The orders allowed Ameren Missouri to accumulate $9 million of certain costs incurred related to the COVID-19 pandemic, net of cost savings, as well as forgone customer late fee and reconnection fee revenues from March 2020 to March 2021, for potential recovery in the electric and natural gas service regulatory rate reviews discussed above. In March 2021, Ameren Missouri deferred $5 million as a regulatory asset related to the accounting authority orders. If approved for recovery, Ameren Missouri would recognize the remaining $4 million associated with forgone customer late fee and reconnection fee revenue when billed to customers.
During its return to full power after the completion of the last refueling and maintenance outage in late December 2020, the Callaway Energy Center experienced a non-nuclear operating issue related to its generator. After replacement of certain key components of the generator, the energy center returned to service on August 4, 2021. The cost of generator repairs was approximately $60 million, which was largely capital expenditures. See Note 10 – Callaway Energy Center under Part I, Item 1, of this report for additional information.
In August 2021, a three-judge panel of the United States Court of Appeals for the Eighth Circuit issued a decision that affirmed the United States District Court for the Eastern District of Missouri’s January 2017 liability ruling and the district court’s September 2019 remedy order as it related to the installation of a flue gas desulfurization system at the Rush Island Energy Center, but reversed the order as it related to the installation of a dry sorbent injection system at the Labadie Energy Center. For additional information on the NSR and Clean Air Act litigation, see Note 9 – Commitments and Contingencies under Part I, Item 1, of this report.
In September 2021, the MoPSC issued an order approving Ameren Missouri’s energy savings results for the second year of the MEEIA 2019 program. As a result of this order, and in accordance with revenue recognition guidance, Ameren Missouri recognized revenues of $9 million in the third quarter of 2021.
In March 2021, the ICC issued an order approving Ameren Illinois’ requested tariff to reconcile its electric distribution service revenue requirement once Ameren Illinois ceases to update customer rates under performance-based formula ratemaking. The last update under
such ratemaking is anticipated to be for 2023 customer rates. The tariff would allow Ameren Illinois to reconcile its revenue requirement for up to two annual periods in which customer rates had been established but not yet reconciled, under the performance-based formula ratemaking framework.for 2022 and 2023. To utilize the reconciliation, Ameren Illinois is required to file a request to update its electric distribution service rates through either a traditional regulatory rate review, which may be based on a future test year and would reflect a proposed ROE subject to ICC approval. Thatapproval, or through the filing of an MYRP, which Ameren Illinois expects to file for rates effective beginning in 2024 pursuant to the CEJA as described below. Based on AIC’s anticipated last year setting rates under IEIMA performance-based formula ratemaking, the rate update request would need to be filed by the end of March in the year following the last year in which Ameren Illinois opted to set annual rates via the performance-based formula ratemaking framework. Ameren Illinois would be required to file that request no later than Marchmid-January 2023. Pursuant to the order, and without legislative change or Ameren Illinois’ election to opt out of performance-based formula ratemaking, Ameren Illinois’ 2022 and 2023 revenues would reflect each year’s actual recoverable costs, year-end rate base, and a return at the applicable WACC, with the ROE component based on the annual average of the monthly yields of the 30-year United States Treasury bonds plus 580 basis points. The revenue requirement reconciliation adjustment would be collected from, or refunded to, customers within two years from the end of the reconciled year.year.
In September 2021, the CEJA was enacted, which resulted in changes to the regulatory framework applicable to Ameren Illinois’ electric distribution business, among other things. The CEJA allows Ameren Illinois to file an MYRP with the ICC by mid-January 2023, with rates effective beginning in 2024. Subject to stakeholder workshops regarding the MYRP ratemaking process, including establishing performance metrics, Ameren Illinois anticipates filing an MYRP by mid-January 2023 to establish rates for 2024. Under the MYRP, the ICC would approve base rates for electric distribution service to be charged to customers for each calendar year of a four-year period, based on each year's forecasted recoverable costs, an ROE approved by the ICC and applied to each calendar year of the four-year period, and a common equity ratio of up to 50% being deemed prudent and reasonable by law, with a higher equity ratio requiring specific ICC approval. The approved ROE would be subject to adjustment during the four-year period based on certain performance metrics, with aggregate symmetrical performance-based ROE incentives and penalties ranging from 20 to 60 basis points. The MYRP would also allow Ameren Illinois to reconcile electric distribution service rates to its actual revenue requirement on an annual basis, subject to an aggregate reconciliation cap of 105% of the annual revenue requirement approved by the ICC. Certain variations from forecasted costs and costs recovered through riders outside of base rates would be excluded from the reconciliation cap. Electric distribution service revenues would continue to be decoupled from sales volumes under an MYRP. If Ameren Illinois does not file an MYRP for rates effective beginning in 2024, its next opportunity to file an MYRP would be for rates effective beginning in 2028. Ameren Illinois expects to continue to use the current IEIMA performance-based formula ratemaking framework to establish annual customer rates effective through 2023 and reconcile the related revenue requirements. In order to utilize the IEIMA reconciliation, Ameren Illinois must file either a traditional regulatory rate review or an MYRP pursuant to the CEJA by mid-January 2023.
In April 2021, Ameren Illinois filed its annual electric distribution service performance-based formula rate update to be used for 2022 rates with the ICC. In JuneAugust 2021, Ameren Illinois filed a revised request seeking to increase its annual revenues for electric distribution service by $59 million. Also in August 2021, the ICC staff submitted its calculation of the revenue requirement included in Ameren Illinois’ update filing, recommending a $54 million increase. In July 2021,an amount comparable to Ameren Illinois filed a revised request seeking to increase its annual revenues for electric distribution service by $60 million.Illinois’ filing. An ICC decision in this proceeding is expectedrequired by December 2021, with new rates effective in January 2022.
In May 2021, Ameren Illinois filed its annual electric customer energy-efficiency formula rate update to be used for 2022 rates with the ICC. In September 2021, Ameren Illinois filed a revised request to increase its rates by $11$10 million, withwhich is comparable to a calculation submitted by the ICC.ICC staff in August 2021. An ICC decision in this proceeding is expectedrequired by December 2021, with new rates effective in January 2022.
In July 2021, the ICC issued an order approving Ameren Illinois’ energy-efficiency plan that includes annual investments in electric energy-efficiency programs up toof approximately $100 million per year from 2022 through 2025. Pursuant to the CEJA, the annual investments in electric energy-efficiency programs may increase by approximately $10 million to $40 million, with the increase depending on the election of certain customers to participate in the programs. Those customers have until late January 2022 to decide if they will participate in the four-year programs. The ICC has the ability to reduce the amount of electric energy-efficiency savings goals in future plan program years if there are insufficient cost-effective programs available, which could reduce the investments in electric energy-efficiency programs. The electric energy-efficiency program investments and the return on those investments are collected from customers through a rider and are not recovered through the electric distribution service performance-based formula ratemaking framework.
RESULTS OF OPERATIONS
Our results of operations and financial position are affected by many factors. Economic conditions, including those resulting from the COVID-19 pandemic discussed below, energy-efficiency investments by our customers and by us, technological advances, distributed generation, and the actions of key customers can significantly affect the demand for our services. Ameren and Ameren Missouri results are also affected by seasonal fluctuations in winter heating and summer cooling demands, as well as by energy center maintenance outages. Additionally, fluctuations in interest rates and conditions in the capital and credit markets affect our cost of borrowing, and our pension and postretirement benefits costs. Almost all of Ameren’s revenues are subject to state or federal regulation. This regulation has a material impact on the rates we charge customers for our services. Our results of operations, financial position, and liquidity are affected by our ability to align our overall spending, both operating and capital, with the frameworks established by our regulators. See Note 2 – Rate and Regulatory
Matters under Part I, Item 1, of this report and Note 2 – Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K for additional information regarding Ameren Missouri’s, Ameren Illinois’, and ATXI’s regulatory mechanisms.
We continue to assess the impacts of the COVID-19 pandemic on our businesses, including impacts on electric and natural gas sales volumes, liquidity, supply chain operations, and bad debt expense. Regarding uncollectible accounts receivable, Ameren Illinois’ electric distribution and natural gas distribution businesses have bad debt riders, which provide for recovery of bad debt write-offs, net of any subsequent recoveries. Ameren Missouri does not have a bad debt rider or tracker, and thus its earnings are exposed to increases in bad debt expense, absent regulatory relief. However, Ameren Missouri has not experienced and does not expect a material impact to earnings from increases in bad debt expense. As of JuneSeptember 30, 2021, accounts receivable balances that were 30 days or greater past due or that were a part of a deferred payment arrangement represented 26%18%, 17%12%, and 35%25%, or $116$97 million, $32$33 million, and $84$64 million, of Ameren’s, Ameren Missouri’s, and Ameren Illinois’ customer trade receivables before allowance for doubtful accounts, respectively. In comparison, as of JuneSeptember 30, 2019, these percentages were 17%13%, 11%9%, and 25%18%, or $83$65 million, $24$23 million, and $59$42 million, for Ameren, Ameren Missouri, and Ameren Illinois, respectively. Ameren Missouri's electric sales volumes have been, and continue to be, affected by the COVID-19 pandemic. In the three and sixnine months ended JuneSeptember 30, 2021, compared to the same periods in 2020, Ameren Missouri experienced an increase in commercial and industrialresidential electric sales volumes, partially offset by decreased electric sales volumes to higherlower margin residentialindustrial customers in the three months ended September 30, 2021, excluding the estimated effects of weather and customer energy-efficiency programs. The following table provides the increases and (decreases) in Ameren Missouri electric sales volumes by customer class for the three and sixnine months ended JuneSeptember 30, 2021, compared to the same periods in 2020, excluding the estimated effects of weather and customer energy-efficiency programs:
| | Ameren Missouri Customer Class | Ameren Missouri Customer Class | | Three months ended June 30, 2021, versus same period in 2020 | | Six months ended June 30, 2021, versus same period in 2020 | | | Ameren Missouri Customer Class | | Three months ended September 30, 2021, versus same period in 2020 | | Nine months ended September 30, 2021, versus same period in 2020 | | |
| Residential | Residential | | (4.2) | % | | (0.4) | % | | | Residential | | 4.4 | % | | 1.3 | % | | |
| Commercial | Commercial | | 8.5 | % | | 2.5 | % | | | Commercial | | 5.1 | % | | 3.4 | % | | |
| Industrial | Industrial | | 7.0 | % | | 2.9 | % | | | Industrial | | (2.0) | % | | 1.1 | % | | |
| Total | Total | | 2.9 | % | | 1.2 | % | | | Total | | 3.8 | % | | 2.1 | % | | |
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Ameren Missouri principally uses coal and enriched uranium for fuel in its electric operations and purchases natural gas for its customers. Ameren Illinois purchases power and natural gas for its customers. The prices for these commodities can fluctuate significantly because of the global economic and political environment, weather, supply, demand, and many other factors. We have natural gas cost recovery mechanisms for our Illinois and Missouri natural gas distribution businesses, a purchased power cost recovery mechanism for Ameren Illinois’ electric distribution business, and a FAC for Ameren Missouri’s electric business.
We employ various risk management strategies to reduce our exposure to commodity risk and other risks inherent in our business. The reliability of Ameren Missouri’s energy centers and our transmission and distribution systems, and the level and timing of operations and maintenance costs and capital investment, are key factors that we seek to manage in order to optimize our results of operations, financial position, and liquidity.
Earnings Summary
The following table presents a summary of Ameren’s earnings for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Three Months | | Six Months | | Three Months | | Nine Months |
| | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 | | 2021 | | 2020 |
| Net income attributable to Ameren common shareholders | Net income attributable to Ameren common shareholders | $ | 207 | | | $ | 243 | | | $ | 440 | | | $ | 389 | | Net income attributable to Ameren common shareholders | $ | 425 | | | $ | 367 | | | $ | 865 | | | $ | 756 | |
Earnings per common share – diluted | Earnings per common share – diluted | 0.80 | | | 0.98 | | | 1.71 | | | 1.57 | | Earnings per common share – diluted | 1.65 | | | 1.47 | | | 3.36 | | | 3.04 | |
Net income attributable to Ameren common shareholders decreased $36increased $58 million, or 18 cents per diluted share, in the three months ended JuneSeptember 30, 2021, compared with the year-ago period. The decreaseincrease was due to net income decreasesincreases of $41$78 million, $4$11 million, and $1$2 million at Ameren Missouri, Ameren Transmission, and Ameren Illinois Natural Gas,Electric Distribution, respectively. These decreasesincreases were partially offset by a $5$23 million increase in net income at Ameren Illinois Electric Distribution and a $5 million decrease in the net loss for activity not reported as part of a segment, primarily at Ameren (parent)., and by a net loss of $8 million at Ameren Illinois Natural Gas, compared with net income of $2 million in the year-ago period.
Net income attributable to Ameren common shareholders increased $51$109 million, or 1432 cents per diluted share, in the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period. The increase was due to net income increases of $19$94 million, $16 million, $14$9 million, and $6$7 million at Ameren Illinois Natural Gas, Ameren Missouri, Ameren Illinois Electric Distribution, Ameren Illinois Natural Gas, and Ameren Transmission, respectively. These increases were partially offset by a $17 million increase in the net loss for activity not reported as part of a segment, primarily at Ameren (parent), respectively. These increases were partially offset by a $4 million decrease in net income at Ameren Transmission..
Earnings per diluted share were favorably affected in the three and sixnine months ended JuneSeptember 30, 2021, compared to the year-ago periods (except where a specific period is referenced), by:
•a change in rate design pursuant to the MoPSC’s March 2020 electric rate order that resulted in more revenues in the third quarter of 2021 due to a change in the timing of transition from summer to winter volumetric rates, which increased margins at Ameren Missouri for the three months ended September 30, 2021, but will not materially affect full year results (19 cents per share for the three months ended September 30, 2021);
•investments in infrastructure and wind generation pursuant to the PISA and the RESRAM, which resulted in increased deferral of interest expense (7 cents and 14 cents per share, respectively);
•increased rate base investments at Ameren Transmission and Ameren Illinois Electric Distribution and a higher recognized ROE at Ameren Illinois Electric Distribution, which increased revenues at these segments (5 cents and 14 cents per share, respectively);
•the results of the MoPSC’s March 2020 electric rate order, as discussed in Note 2 – Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K, which reduced the base level of expenses at Ameren Missouri, partially offset by lower base rates, net of recovery for amounts associated with the reduction in sales volumes resulting from MEEIA programs and recoverable depreciation under the PISA (10 cents per share for the sixnine months ended JuneSeptember 30, 2021);
•increased rate base investmentselectric retail sales, excluding the estimated effects of weather and MEEIA, at Ameren TransmissionMissouri, largely due to improving economic conditions, which resulted in increased sales volumes to commercial and Ameren Illinois Electric Distribution and a higher recognized ROE at Ameren Illinois Electric Distribution, which increased revenues atresidential customers, partially offset by decreased sales volumes to industrial customers in the respective segments (4three months ended September 30, 2021 (7 cents and 910 cents per share, respectively);
•investments in infrastructure and wind generation pursuant to the PISA and the RESRAM, which resulted in increased deferral of interest expense (5 cents and 7 cents per share, respectively);
•decreased other operations and maintenance expense not subject to riders and trackers, primarily due to disciplined cost management and changes in the cash surrender value of company-owned life insurance (5 cents per share for the six months ended June 30, 2021);
•the impact of weather on electric retail sales at Ameren Missouri, primarily resulting from colder winter and warmer summer temperatures experienced in 2021 (estimated at 1 cent3 cents and 58 cents per share, respectively);
•higher base rates pursuant to the ICC's January 2021 natural gas rate order, which increased margins at Ameren Illinois Natural Gas (1 cent and 45 cents per share, respectively);
•a change in rate design pursuantthe results of true-ups to the ICC's January 2021 natural gas rate order that concentrates more revenues in the winter heating season due to an increase in volumetric rates, which increased margins at Ameren Illinois Natural Gas, but is not expected to materially impact full year results (3 cents per share for the six months ended June 30, 2021);
•increased income tax benefit, primarily at Ameren (parent), due to increased interim period income tax benefits in 2021, largelyrevenue requirement reconciliation adjustment related to wind generation facilities, which is not expected to materially impact full year results (3 cents per shareAmeren Illinois’ rates for the six months ended June 30, 2021);
•increased electric retail sales, excluding the estimated effects of weather, at Ameren Missouri, largely due to improving economic conditions, which resulted in increased sales volumes to commercialdistribution delivery service and industrial customers, partially offset by decreased sales volumes to residential customers (3 centselectric customer energy-efficiency program investments (1 cent and 2 cents per share, respectively); and
•the absence of charitable donations made in 2020 pursuant to the MoPSC’s March 2020 electric rate order (2 cents per share for the sixnine months ended JuneSeptember 30, 2021).
Earnings per diluted share were unfavorably affected in the three and sixnine months ended JuneSeptember 30, 2021, compared to the year-ago periods (except where a specific period is referenced), by:
•a change in rate design pursuant to the MoPSC’s March 2020 electric rate order that resulted in less revenues in the second quarter of 2021 due to a change in the timing of transition from winter to summer volumetric rates, which decreased margins at Ameren Missouri for the three and six months ended June 30, 2021, but is not expected to materially impact full year results (19 cents per share for both periods);
•the result of the FERC’s March 2021 order, primarily related to the historical recovery of materials and supplies inventories, which decreased Ameren Transmission earnings in 2021; and the absence in 2021 of the FERC’s May 2020 order addressing the allowed
base ROE for FERC regulated transmission rate base under the MISO tariff, which increased earnings in the year-ago periods (4 cents and 7 cents per share, respectively);
•increased weighted-average basic common shares outstanding resulting from issuances of common shares as detailed in Note 4 – Long-term Debt and Equity Financings under Part I, Item 1, of this report, and Note 5 – Long Term Debt and Equity Financings under Part II, Item 8, of the Form 10-K (3(7 cents and 613 cents per share, respectively);
•the absence in 2021 of the FERC’s May 2020 order addressing the allowed base ROE for FERC regulated transmission rate base under the MISO tariff, which increased Ameren Transmission earnings in the year-ago period, and the result of the FERC’s March 2021 order, primarily related to the historical recovery of materials and supplies inventories, which decreased Ameren Transmission earnings in 2021 (7 cents per share for the nine months ended September 30, 2021);
•increased other operations and maintenance expenses at Ameren Missouri due to the amortization of expenses, beginning in January 2021, related to the 2020 scheduled refueling and maintenance outage at the Callaway Energy Center pursuant to the MoPSC’s February 2020 order, and increased energy center and distribution maintenance costs for the three months ended JuneSeptember 30, 2021, due to the deferral of projects in the year-ago period (4(7 cents and 6 cents per share, for both periods)respectively);
•increased financing costs, primarily at Ameren Missouri and Ameren (parent), largely due to higher long-term debt balances (2 cents(1 cent and 45 cents per share, respectively); and
•increased depreciation and amortization expenses not recoverable under riders or trackers at Ameren Missouri and Ameren Illinois Natural Gas, primarily due to additional property, plant, and equipment investments (1 cent(2 cents and 4 cents per share, respectively);
•a change in rate design pursuant to the ICC's January 2021 natural gas rate order that concentrates more revenues in the winter heating season due to an increase in volumetric rates, which decreased margins at Ameren Illinois Natural Gas for the three months ended September 30, 2021, but is not expected to materially impact full year results (3 cents per share for the three months ended September 30, 2021); and
•decreased income tax benefit at Ameren (parent), primarily due to year-over-year timing differences, partially offset by increased income tax benefits at Ameren Missouri, primarily due to year-over-year timing differences associated with the recognition of excess deferred income taxes, both of which are not expected to materially impact full year results (5 cents and 2 cents per share, respectively).
The cents per share variances above are presented based on the weighted-average basic common shares outstanding in the three and sixnine months ended JuneSeptember 30, 2020, and do not reflect the impact of dilution on earnings per share, unless otherwise noted. Amounts other than variances related to income taxes have been presented net of income taxes using Ameren’s 2021 blended federal and state statutory tax rate of 26%. For additional details regarding the Ameren Companies’ results of operations, including explanations of Electric and Natural Gas Margins, Other Operations and Maintenance Expenses, Depreciation and Amortization Expenses, Taxes Other Than Income Taxes, Other Income, Net, Interest Charges, and Income Taxes, see the major headings below.
Below is Ameren’s table of income statement components by segment for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Ameren
Missouri | | Ameren
Illinois
Electric
Distribution | | Ameren
Illinois
Natural Gas | | Ameren Transmission | | Other /
Intersegment
Eliminations | | Ameren | | Ameren
Missouri | | Ameren
Illinois
Electric
Distribution | | Ameren
Illinois
Natural Gas | | Ameren Transmission | | Other /
Intersegment
Eliminations | | Ameren |
| Three Months 2021: | Three Months 2021: | | Three Months 2021: | |
| Electric margins | Electric margins | $ | 566 | | | $ | 289 | | | $ | — | | | $ | 136 | | | $ | (9) | | | $ | 982 | | Electric margins | $ | 872 | | | $ | 302 | | | $ | — | | | $ | 160 | | | $ | (9) | | | $ | 1,325 | |
| Natural gas margins | Natural gas margins | 15 | | | — | | | 108 | | | — | | | — | | | 123 | | Natural gas margins | 12 | | | — | | | 86 | | | — | | | — | | | 98 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (218) | | | (129) | | | (53) | | | (14) | | | 2 | | | (412) | | Other operations and maintenance expenses | (240) | | | (148) | | | (55) | | | (16) | | | 2 | | | (457) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (157) | | | (77) | | | (22) | | | (27) | | | (2) | | | (285) | | Depreciation and amortization expenses | (161) | | | (78) | | | (22) | | | (28) | | | (1) | | | (290) | |
| Taxes other than income taxes | Taxes other than income taxes | (85) | | | (18) | | | (15) | | | (2) | | | (2) | | | (122) | | Taxes other than income taxes | (104) | | | (21) | | | (12) | | | (2) | | | (3) | | | (142) | |
| Other income, net | Other income, net | 24 | | | 11 | | | 3 | | | 2 | | | 9 | | | 49 | | Other income, net | 27 | | | 10 | | | 4 | | | 5 | | | 10 | | | 56 | |
| Interest charges | Interest charges | (36) | | | (19) | | | (10) | | | (20) | | | (11) | | | (96) | | Interest charges | (32) | | | (19) | | | (11) | | | (20) | | | (12) | | | (94) | |
| Income (taxes) benefit | Income (taxes) benefit | 3 | | | (16) | | | (3) | | | (20) | | | 5 | | | (31) | | Income (taxes) benefit | 2 | | | (10) | | | 2 | | | (26) | | | (38) | | | (70) | |
| Net income (loss) | Net income (loss) | 112 | | | 41 | | | 8 | | | 55 | | | (8) | | | 208 | | Net income (loss) | 376 | | | 36 | | | (8) | | | 73 | | | (51) | | | 426 | |
Noncontrolling interests – preferred stock dividends | Noncontrolling interests – preferred stock dividends | (1) | | | — | | | — | | | — | | | — | | | (1) | | Noncontrolling interests – preferred stock dividends | (1) | | | — | | | — | | | — | | | — | | | (1) | |
| Net income (loss) attributable to Ameren common shareholders | Net income (loss) attributable to Ameren common shareholders | $ | 111 | | | $ | 41 | | | $ | 8 | | | $ | 55 | | | $ | (8) | | | $ | 207 | | Net income (loss) attributable to Ameren common shareholders | $ | 375 | | | $ | 36 | | | $ | (8) | | | $ | 73 | | | $ | (51) | | | $ | 425 | |
| Three Months 2020: | Three Months 2020: | | Three Months 2020: | |
| Electric margins | Electric margins | $ | 615 | | | $ | 264 | | | $ | — | | | $ | 136 | | | $ | (6) | | | $ | 1,009 | | Electric margins | $ | 795 | | | $ | 279 | | | $ | — | | | $ | 141 | | | $ | (7) | | | $ | 1,208 | |
| Natural gas margins | Natural gas margins | 15 | | | — | | | 104 | | | — | | | — | | | 119 | | Natural gas margins | 12 | | | — | | | 93 | | | — | | | — | | | 105 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (202) | | | (118) | | | (52) | | | (15) | | | 3 | | | (384) | | Other operations and maintenance expenses | (221) | | | (133) | | | (52) | | | (14) | | | 2 | | | (418) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (155) | | | (71) | | | (20) | | | (23) | | | (2) | | | (271) | | Depreciation and amortization expenses | (154) | | | (71) | | | (21) | | | (25) | | | (2) | | | (273) | |
| Taxes other than income taxes | Taxes other than income taxes | (83) | | | (19) | | | (13) | | | (2) | | | (2) | | | (119) | | Taxes other than income taxes | (92) | | | (21) | | | (11) | | | (2) | | | (2) | | | (128) | |
| Other income, net | Other income, net | 25 | | | 9 | | | 5 | | | 3 | | | 6 | | | 48 | | Other income, net | 26 | | | 9 | | | 4 | | | 4 | | | 5 | | | 48 | |
| Interest charges | Interest charges | (50) | | | (18) | | | (10) | | | (18) | | | (12) | | | (108) | | Interest charges | (50) | | | (19) | | | (10) | | | (19) | | | (12) | | | (110) | |
| Income taxes | Income taxes | (12) | | | (11) | | | (4) | | | (22) | | | (1) | | | (50) | | Income taxes | (18) | | | (10) | | | (1) | | | (22) | | | (12) | | | (63) | |
| Net income (loss) | Net income (loss) | 153 | | | 36 | | | 10 | | | 59 | | | (14) | | | 244 | | Net income (loss) | 298 | | | 34 | | | 2 | | | 63 | | | (28) | | | 369 | |
Noncontrolling interests – preferred stock dividends | Noncontrolling interests – preferred stock dividends | (1) | | | — | | | (1) | | | — | | | 1 | | | (1) | | Noncontrolling interests – preferred stock dividends | (1) | | | — | | | — | | | (1) | | | — | | | (2) | |
| Net income (loss) attributable to Ameren common shareholders | Net income (loss) attributable to Ameren common shareholders | $ | 152 | | | $ | 36 | | | $ | 9 | | | $ | 59 | | | $ | (13) | | | $ | 243 | | Net income (loss) attributable to Ameren common shareholders | $ | 297 | | | $ | 34 | | | $ | 2 | | | $ | 62 | | | $ | (28) | | | $ | 367 | |
| Six Months 2021: | | |
| Nine Months 2021: | | Nine Months 2021: | |
| Electric margins | Electric margins | $ | 1,054 | | | $ | 578 | | | $ | — | | | $ | 266 | | | $ | (16) | | | $ | 1,882 | | Electric margins | $ | 1,926 | | | $ | 880 | | | $ | — | | | $ | 426 | | | $ | (25) | | | $ | 3,207 | |
| Natural gas margins | Natural gas margins | 47 | | | — | | | 321 | | | — | | | — | | | 368 | | Natural gas margins | 59 | | | — | | | 407 | | | — | | | — | | | 466 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (443) | | | (254) | | | (109) | | | (30) | | | 4 | | | (832) | | Other operations and maintenance expenses | (683) | | | (402) | | | (164) | | | (46) | | | 6 | | | (1,289) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (313) | | | (152) | | | (44) | | | (55) | | | (2) | | | (566) | | Depreciation and amortization expenses | (474) | | | (230) | | | (66) | | | (83) | | | (3) | | | (856) | |
| Taxes other than income taxes | Taxes other than income taxes | (162) | | | (38) | | | (40) | | | (4) | | | (6) | | | (250) | | Taxes other than income taxes | (266) | | | (59) | | | (52) | | | (6) | | | (9) | | | (392) | |
| Other income, net | Other income, net | 47 | | | 19 | | | 6 | | | 5 | | | 18 | | | 95 | | Other income, net | 74 | | | 29 | | | 10 | | | 10 | | | 28 | | | 151 | |
| Interest charges | Interest charges | (75) | | | (37) | | | (20) | | | (43) | | | (21) | | | (196) | | Interest charges | (107) | | | (56) | | | (31) | | | (63) | | | (33) | | | (290) | |
| Income (taxes) benefit | Income (taxes) benefit | 5 | | | (28) | | | (31) | | | (37) | | | 33 | | | (58) | | Income (taxes) benefit | 7 | | | (38) | | | (29) | | | (63) | | | (5) | | | (128) | |
| Net income | 160 | | | 88 | | | 83 | | | 102 | | | 10 | | | 443 | | |
| Net income (loss) | | Net income (loss) | 536 | | | 124 | | | 75 | | | 175 | | | (41) | | | 869 | |
Noncontrolling interests – preferred stock dividends | Noncontrolling interests – preferred stock dividends | (2) | | | (1) | | | — | | | — | | | — | | | (3) | | Noncontrolling interests – preferred stock dividends | (3) | | | (1) | | | — | | | — | | | — | | | (4) | |
| Net income attributable to Ameren common shareholders | $ | 158 | | | $ | 87 | | | $ | 83 | | | $ | 102 | | | $ | 10 | | | $ | 440 | | |
| Six Months 2020: | | |
| Net income (loss) attributable to Ameren common shareholders | | Net income (loss) attributable to Ameren common shareholders | $ | 533 | | | $ | 123 | | | $ | 75 | | | $ | 175 | | | $ | (41) | | | $ | 865 | |
| Nine Months 2020: | | Nine Months 2020: | |
| Electric margins | Electric margins | $ | 1,067 | | | $ | 544 | | | $ | — | | | $ | 259 | | | $ | (15) | | | $ | 1,855 | | Electric margins | $ | 1,862 | | | $ | 823 | | | $ | — | | | $ | 400 | | | $ | (22) | | | $ | 3,063 | |
| Natural gas margins | Natural gas margins | 46 | | | — | | | 286 | | | — | | | — | | | 332 | | Natural gas margins | 58 | | | — | | | 379 | | | — | | | — | | | 437 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (441) | | | (248) | | | (109) | | | (29) | | | 5 | | | (822) | | Other operations and maintenance expenses | (662) | | | (381) | | | (161) | | | (43) | | | 7 | | | (1,240) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (294) | | | (142) | | | (41) | | | (47) | | | (2) | | | (526) | | Depreciation and amortization expenses | (448) | | | (213) | | | (62) | | | (72) | | | (4) | | | (799) | |
| Taxes other than income taxes | Taxes other than income taxes | (162) | | | (38) | | | (35) | | | (4) | | | (5) | | | (244) | | Taxes other than income taxes | (254) | | | (59) | | | (46) | | | (6) | | | (7) | | | (372) | |
| Other income, net | Other income, net | 29 | | | 16 | | | 7 | | | 5 | | | 12 | | | 69 | | Other income, net | 55 | | | 25 | | | 11 | | | 9 | | | 17 | | | 117 | |
| Interest charges | Interest charges | (90) | | | (36) | | | (20) | | | (39) | | | (16) | | | (201) | | Interest charges | (140) | | | (55) | | | (30) | | | (58) | | | (28) | | | (311) | |
| Income (taxes) benefit | Income (taxes) benefit | (11) | | | (22) | | | (23) | | | (39) | | | 24 | | | (71) | | Income (taxes) benefit | (29) | | | (32) | | | (24) | | | (61) | | | 12 | | | (134) | |
| Net income | 144 | | | 74 | | | 65 | | | 106 | | | 3 | | | 392 | | |
| Net income (loss) | | Net income (loss) | 442 | | | 108 | | | 67 | | | 169 | | | (25) | | | 761 | |
Noncontrolling interests – preferred stock dividends | Noncontrolling interests – preferred stock dividends | (2) | | | (1) | | | (1) | | | — | | | 1 | | | (3) | | Noncontrolling interests – preferred stock dividends | (3) | | | (1) | | | (1) | | | (1) | | | 1 | | | (5) | |
| Net income attributable to Ameren common shareholders | $ | 142 | | | $ | 73 | | | $ | 64 | | | $ | 106 | | | $ | 4 | | | $ | 389 | | |
| Net income (loss) attributable to Ameren common shareholders | | Net income (loss) attributable to Ameren common shareholders | $ | 439 | | | $ | 107 | | | $ | 66 | | | $ | 168 | | | $ | (24) | | | $ | 756 | |
Below is Ameren Illinois’ table of income statement components by segment for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Ameren
Illinois
Electric
Distribution | | Ameren
Illinois
Natural Gas | | Ameren
Illinois Transmission | | | Ameren Illinois | | Ameren
Illinois
Electric
Distribution | | Ameren
Illinois
Natural Gas | | Ameren
Illinois Transmission | | | Ameren Illinois |
| Three Months 2021: | Three Months 2021: | | | | Three Months 2021: | | | |
| Electric and natural gas margins | | Electric and natural gas margins | $ | 302 | | | $ | 86 | | | $ | 108 | | | | $ | 496 | |
| Other operations and maintenance expenses | | Other operations and maintenance expenses | (148) | | | (55) | | | (14) | | | | (217) | |
| Depreciation and amortization expenses | | Depreciation and amortization expenses | (78) | | | (22) | | | (18) | | | | (118) | |
| Taxes other than income taxes | | Taxes other than income taxes | (21) | | | (12) | | | (1) | | | | (34) | |
| Other income, net | | Other income, net | 10 | | | 4 | | | 5 | | | | 19 | |
| Interest charges | | Interest charges | (19) | | | (11) | | | (11) | | | | (41) | |
| Income (taxes) benefit | | Income (taxes) benefit | (10) | | | 2 | | | (18) | | | | (26) | |
| | Net income (loss) attributable to Ameren common shareholders | | Net income (loss) attributable to Ameren common shareholders | $ | 36 | | | $ | (8) | | | $ | 51 | | | | $ | 79 | |
| Three Months 2020: | | Three Months 2020: | | | |
| Electric and natural gas margins | Electric and natural gas margins | $ | 289 | | | $ | 108 | | | $ | 88 | | | | $ | 485 | | Electric and natural gas margins | $ | 279 | | | $ | 93 | | | $ | 91 | | | | $ | 463 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (129) | | | (53) | | | (11) | | | | (193) | | Other operations and maintenance expenses | (133) | | | (52) | | | (12) | | | | (197) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (77) | | | (22) | | | (18) | | | | (117) | | Depreciation and amortization expenses | (71) | | | (21) | | | (17) | | | | (109) | |
| Taxes other than income taxes | Taxes other than income taxes | (18) | | | (15) | | | (1) | | | | (34) | | Taxes other than income taxes | (21) | | | (11) | | | (1) | | | | (33) | |
| Other income, net | Other income, net | 11 | | | 3 | | | 2 | | | | 16 | | Other income, net | 9 | | | 4 | | | 4 | | | | 17 | |
| Interest charges | Interest charges | (19) | | | (10) | | | (11) | | | | (40) | | Interest charges | (19) | | | (10) | | | (10) | | | | (39) | |
| Income taxes | Income taxes | (16) | | | (3) | | | (12) | | | | (31) | | Income taxes | (10) | | | (1) | | | (14) | | | | (25) | |
| | Net income attributable to common shareholder | Net income attributable to common shareholder | $ | 41 | | | $ | 8 | | | $ | 37 | | | | $ | 86 | | Net income attributable to common shareholder | $ | 34 | | | $ | 2 | | | $ | 41 | | | | $ | 77 | |
| Three Months 2020: | | | | |
| Nine Months 2021: | | Nine Months 2021: | | | |
| Electric and natural gas margins | Electric and natural gas margins | $ | 264 | | | $ | 104 | | | $ | 87 | | | | $ | 455 | | Electric and natural gas margins | $ | 880 | | | $ | 407 | | | $ | 277 | | | | $ | 1,564 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (118) | | | (52) | | | (12) | | | | (182) | | Other operations and maintenance expenses | (402) | | | (164) | | | (38) | | | | (604) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (71) | | | (20) | | | (16) | | | | (107) | | Depreciation and amortization expenses | (230) | | | (66) | | | (54) | | | | (350) | |
| Taxes other than income taxes | Taxes other than income taxes | (19) | | | (13) | | | — | | | | (32) | | Taxes other than income taxes | (59) | | | (52) | | | (3) | | | | (114) | |
| Other income, net | Other income, net | 9 | | | 5 | | | 3 | | | | 17 | | Other income, net | 29 | | | 10 | | | 10 | | | | 49 | |
| Interest charges | Interest charges | (18) | | | (10) | | | (10) | | | | (38) | | Interest charges | (56) | | | (31) | | | (36) | | | | (123) | |
| Income taxes | Income taxes | (11) | | | (4) | | | (14) | | | | (29) | | Income taxes | (38) | | | (29) | | | (40) | | | | (107) | |
| Net income | Net income | 36 | | | 10 | | | 38 | | | | 84 | | Net income | 124 | | | 75 | | | 116 | | | | 315 | |
| Preferred stock dividends | Preferred stock dividends | — | | | (1) | | | — | | | | (1) | | Preferred stock dividends | (1) | | | — | | | — | | | | (1) | |
| Net income attributable to common shareholder | Net income attributable to common shareholder | $ | 36 | | | $ | 9 | | | $ | 38 | | | | $ | 83 | | Net income attributable to common shareholder | $ | 123 | | | $ | 75 | | | $ | 116 | | | | $ | 314 | |
| Six Months 2021: | | | | |
| Nine Months 2020: | | Nine Months 2020: | | | |
| Electric and natural gas margins | Electric and natural gas margins | $ | 578 | | | $ | 321 | | | $ | 169 | | | | $ | 1,068 | | Electric and natural gas margins | $ | 823 | | | $ | 379 | | | $ | 252 | | | | $ | 1,454 | |
| Other operations and maintenance expenses | Other operations and maintenance expenses | (254) | | | (109) | | | (24) | | | | (387) | | Other operations and maintenance expenses | (381) | | | (161) | | | (36) | | | | (578) | |
| Depreciation and amortization expenses | Depreciation and amortization expenses | (152) | | | (44) | | | (36) | | | | (232) | | Depreciation and amortization expenses | (213) | | | (62) | | | (48) | | | | (323) | |
| Taxes other than income taxes | Taxes other than income taxes | (38) | | | (40) | | | (2) | | | | (80) | | Taxes other than income taxes | (59) | | | (46) | | | (2) | | | | (107) | |
| Other income, net | Other income, net | 19 | | | 6 | | | 5 | | | | 30 | | Other income, net | 25 | | | 11 | | | 9 | | | | 45 | |
| Interest charges | Interest charges | (37) | | | (20) | | | (25) | | | | (82) | | Interest charges | (55) | | | (30) | | | (31) | | | | (116) | |
| Income taxes | Income taxes | (28) | | | (31) | | | (22) | | | | (81) | | Income taxes | (32) | | | (24) | | | (37) | | | | (93) | |
| Net income | Net income | 88 | | | 83 | | | 65 | | | | 236 | | Net income | 108 | | | 67 | | | 107 | | | | 282 | |
| Preferred stock dividends | Preferred stock dividends | (1) | | | — | | | — | | | | (1) | | Preferred stock dividends | (1) | | | (1) | | | — | | | | (2) | |
| Net income attributable to common shareholder | Net income attributable to common shareholder | $ | 87 | | | $ | 83 | | | $ | 65 | | | | $ | 235 | | Net income attributable to common shareholder | $ | 107 | | | $ | 66 | | | $ | 107 | | | | $ | 280 | |
| Six Months 2020: | | | | |
| Electric and natural gas margins | $ | 544 | | | $ | 286 | | | $ | 161 | | | | $ | 991 | | |
| Other operations and maintenance expenses | (248) | | | (109) | | | (24) | | | | (381) | | |
| Depreciation and amortization expenses | (142) | | | (41) | | | (31) | | | | (214) | | |
| Taxes other than income taxes | (38) | | | (35) | | | (1) | | | | (74) | | |
| Other income, net | 16 | | | 7 | | | 5 | | | | 28 | | |
| Interest charges | (36) | | | (20) | | | (21) | | | | (77) | | |
| Income taxes | (22) | | | (23) | | | (23) | | | | (68) | | |
| Net income | 74 | | | 65 | | | 66 | | | | 205 | | |
| Preferred stock dividends | (1) | | | (1) | | | — | | | | (2) | | |
| Net income attributable to common shareholder | $ | 73 | | | $ | 64 | | | $ | 66 | | | | $ | 203 | | |
Electric and Natural Gas Margins
Electric margins are defined as electric revenues less fuel and purchased power costs. Natural gas margins are defined as natural gas revenues less natural gas purchased for resale. We consider electric and natural gas margins useful measures to analyze the change in profitability of our electric and natural gas operations between periods. We have included the analysis below to complement the financial information we provide in accordance with GAAP. However, these margins may not be a presentation defined under GAAP, and they may not be comparable to other companies’ presentations or more useful than the GAAP information we provide elsewhere in this report.
Electric Margins
| | | | | | | | | | | | | | | | | | | | |
|
| | Increase (Decrease) by Segment | |
| | | Overall Ameren DecreaseIncrease of $27$117 Million (QTD YoY) | | Overall Ameren Increase of $27$144 Million (YTD YoY) | |
| Total by Segment(a) | | | |
(a)Includes other/intersegment eliminations of $(9) million and $(6)$(7) million in the three months ended JuneSeptember 30, 2021 and 2020. Also includes other/intersegment eliminations of $(16)2020, respectively, and $(25) million and $(15)$(22) million in the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Electric Distribution | | Ameren Transmission | | | Other/Intersegment Eliminations | |
Natural Gas Margins
| | | | | | | | | | | | | | | | | | | | |
| | | Increase (Decrease) by Segment | |
| | | Overall Ameren IncreaseDecrease of $4$7 Million (QTD YoY) | | Overall Ameren Increase of $36$29 Million (YTD YoY) | |
| Total by Segment(a) | | | |
| | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Natural Gas | |
(a)Includes Ameren Missouri natural gas margins of $12 million and $12 million in the three months ended September 30, 2021 and 2020, respectively.
The following tables present the favorable (unfavorable) variations by Ameren segment for electric and natural gas margins for the sixthree and nine months ended JuneSeptember 30, 2021, compared with the year-ago periods:
| | Electric and Natural Gas Margins | Electric and Natural Gas Margins | | Electric and Natural Gas Margins | |
| Three Months | Three Months | Ameren Missouri | | Ameren Illinois
Electric Distribution | | Ameren Illinois
Natural Gas | | Ameren Transmission(a) | | Other /Intersegment Eliminations | | Ameren | | Three Months | Ameren Missouri | | Ameren Illinois
Electric Distribution | | Ameren Illinois
Natural Gas | | Ameren Transmission(a) | | Other /Intersegment Eliminations | | Ameren | |
| Electric revenue change: | Electric revenue change: | | | Electric revenue change: | | |
Effect of weather (estimate)(b) | Effect of weather (estimate)(b) | $ | 5 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 5 | | | Effect of weather (estimate)(b) | $ | 10 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 10 | | |
Base rates (estimate)(c) | Base rates (estimate)(c) | — | | | 19 | | | — | | | — | | | — | | | 19 | | | Base rates (estimate)(c) | — | | | 15 | | | — | | | 19 | | | — | | | 34 | | |
| | Sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA) | Sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA) | 11 | | | — | | | — | | | — | | | — | | | 11 | | | Sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA) | 24 | | | — | | | — | | | — | | | — | | | 24 | | |
| Change in rate design | Change in rate design | (63) | | | — | | | — | | | — | | | — | | | (63) | | | Change in rate design | 64 | | | — | | | — | | | — | | | — | | | 64 | | |
| Customer demand charges | 2 | | | — | | | — | | | — | | | — | | | 2 | | | |
| | MEEIA performance incentives | | MEEIA performance incentives | 3 | | | — | | | — | | | — | | | — | | | 3 | | |
| Off-system sales, capacity, and FAC revenues, net | Off-system sales, capacity, and FAC revenues, net | 54 | | | — | | | — | | | — | | | — | | | 54 | | | Off-system sales, capacity, and FAC revenues, net | 19 | | | — | | | — | | | — | | | — | | | 19 | | |
| Energy-efficiency program investment revenues | — | | | 2 | | | — | | | — | | | — | | | 2 | | | |
| Ameren Illinois energy-efficiency program investment revenues | | Ameren Illinois energy-efficiency program investment revenues | — | | | 4 | | | — | | | — | | | — | | | 4 | | |
| Other | Other | 5 | | | 3 | | | — | | | — | | | (7) | | | 1 | | | Other | 3 | | | 4 | | | — | | | — | | | (3) | | | 4 | | |
Cost recovery mechanisms – offset in fuel and purchased power(d) | Cost recovery mechanisms – offset in fuel and purchased power(d) | 11 | | | 11 | | | — | | | — | | | — | | | 22 | | | Cost recovery mechanisms – offset in fuel and purchased power(d) | 27 | | | 13 | | | — | | | — | | | (3) | | | 37 | | |
Other cost recovery mechanisms(e) | Other cost recovery mechanisms(e) | (7) | | | 1 | | | — | | | — | | | — | | | (6) | | | Other cost recovery mechanisms(e) | (21) | | | 1 | | | — | | | — | | | — | | | (20) | | |
| Total electric revenue change | Total electric revenue change | $ | 18 | | | $ | 36 | | | $ | — | | | $ | — | | | $ | (7) | | | $ | 47 | | | Total electric revenue change | $ | 129 | | | $ | 37 | | | $ | — | | | $ | 19 | | | $ | (6) | | | $ | 179 | | |
| Fuel and purchased power change: | Fuel and purchased power change: | | | Fuel and purchased power change: | | |
| Energy costs (excluding the estimated effect of weather) | Energy costs (excluding the estimated effect of weather) | $ | (53) | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | (53) | | | Energy costs (excluding the estimated effect of weather) | $ | (22) | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | (22) | | |
Effect of weather (estimate)(b) | Effect of weather (estimate)(b) | (1) | | | — | | | — | | | — | | | — | | | (1) | | | Effect of weather (estimate)(b) | (1) | | | — | | | — | | | — | | | — | | | (1) | | |
| | Other | Other | (2) | | | — | | | — | | | — | | | 4 | | | 2 | | | Other | (2) | | | (1) | | | — | | | — | | | 1 | | | (2) | | |
Cost recovery mechanisms – offset in electric revenue(d) | Cost recovery mechanisms – offset in electric revenue(d) | (11) | | | (11) | | | — | | | — | | | — | | | (22) | | | Cost recovery mechanisms – offset in electric revenue(d) | (27) | | | (13) | | | — | | | — | | | 3 | | | (37) | | |
| Total fuel and purchased power change | Total fuel and purchased power change | $ | (67) | | | $ | (11) | | | $ | — | | | $ | — | | | $ | 4 | | | $ | (74) | | | Total fuel and purchased power change | $ | (52) | | | $ | (14) | | | $ | — | | | $ | — | | | $ | 4 | | | $ | (62) | | |
| Net change in electric margins | Net change in electric margins | $ | (49) | | | $ | 25 | | | $ | — | | | $ | — | | | $ | (3) | | | $ | (27) | | | Net change in electric margins | $ | 77 | | | $ | 23 | | | $ | — | | | $ | 19 | | | $ | (2) | | | $ | 117 | | |
| Natural gas revenue change: | Natural gas revenue change: | | | Natural gas revenue change: | | |
Effect of weather (estimate)(b) | $ | (1) | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | (1) | | | |
| | Base rates (estimate) | Base rates (estimate) | — | | | — | | | 4 | | | — | | | — | | | 4 | | | Base rates (estimate) | $ | — | | | $ | — | | | $ | 2 | | | $ | — | | | $ | — | | | $ | 2 | | |
| Change in rate design | Change in rate design | — | | | — | | | (4) | | | — | | | — | | | (4) | | | Change in rate design | — | | | — | | | (11) | | | — | | | — | | | (11) | | |
| | Other | — | | | — | | | 2 | | | — | | | — | | | 2 | | | |
| Cost recovery mechanisms – offset in natural gas purchased for resale(d) | Cost recovery mechanisms – offset in natural gas purchased for resale(d) | — | | | — | | | 24 | | | — | | | — | | | 24 | | | Cost recovery mechanisms – offset in natural gas purchased for resale(d) | (1) | | | — | | | 12 | | | — | | | — | | | 11 | | |
Other cost recovery mechanisms(e) | Other cost recovery mechanisms(e) | — | | | — | | | 2 | | | — | | | — | | | 2 | | | Other cost recovery mechanisms(e) | — | | | — | | | 2 | | | — | | | — | | | 2 | | |
| Total natural gas revenue change | Total natural gas revenue change | $ | (1) | | | $ | — | | | $ | 28 | | | $ | — | | | $ | — | | | $ | 27 | | | Total natural gas revenue change | $ | (1) | | | $ | — | | | $ | 5 | | | $ | — | | | $ | — | | | $ | 4 | | |
| Natural gas purchased for resale change: | Natural gas purchased for resale change: | | | Natural gas purchased for resale change: | | |
Effect of weather (estimate)(b) | $ | 1 | | | $ | — | | | $ | — | | | $ | — | | | — | | | $ | 1 | | | |
| | Cost recovery mechanisms – offset in natural gas revenue(d) | Cost recovery mechanisms – offset in natural gas revenue(d) | — | | | — | | | (24) | | | — | | | — | | | (24) | | | Cost recovery mechanisms – offset in natural gas revenue(d) | $ | 1 | | | $ | — | | | $ | (12) | | | $ | — | | | $ | — | | | $ | (11) | | |
| Total natural gas purchased for resale change | Total natural gas purchased for resale change | $ | 1 | | | $ | — | | | $ | (24) | | | $ | — | | | $ | — | | | $ | (23) | | | Total natural gas purchased for resale change | $ | 1 | | | $ | — | | | $ | (12) | | | $ | — | | | $ | — | | | $ | (11) | | |
| Net change in natural gas margins | Net change in natural gas margins | $ | — | | | $ | — | | | $ | 4 | | | $ | — | | | $ | — | | | $ | 4 | | | Net change in natural gas margins | $ | — | | | $ | — | | | $ | (7) | | | $ | — | | | $ | — | | | $ | (7) | | |
| | | Six Months | Ameren Missouri | | Ameren Illinois
Electric Distribution | | Ameren Illinois
Natural Gas | | Ameren Transmission(a) | | Other /Intersegment Eliminations | | Ameren | | |
| Nine Months | | Nine Months | Ameren Missouri | | Ameren Illinois
Electric Distribution | | Ameren Illinois
Natural Gas | | Ameren Transmission(a) | | Other /Intersegment Eliminations | | Ameren | |
| Electric revenue change: | Electric revenue change: | | | Electric revenue change: | | |
Effect of weather (estimate)(b) | Effect of weather (estimate)(b) | $ | 23 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 23 | | | Effect of weather (estimate)(b) | $ | 33 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 33 | | |
Base rates (estimate)(c) | Base rates (estimate)(c) | (6) | | | 22 | | | — | | | 7 | | | — | | | 23 | | | Base rates (estimate)(c) | (6) | | | 40 | | | — | | | 26 | | | — | | | 60 | | |
| Sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA) | Sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA) | 8 | | | — | | | — | | | — | | | — | | | 8 | | | Sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA) | 34 | | | — | | | — | | | — | | | — | | | 34 | | |
| Change in rate design | (63) | | | — | | | — | | | — | | | — | | | (63) | | | |
| | MEEIA performance incentives | | MEEIA performance incentives | 3 | | | — | | | — | | | — | | | — | | | 3 | | |
| Off-system sales, capacity, and FAC revenues, net | Off-system sales, capacity, and FAC revenues, net | 49 | | | — | | | — | | | — | | | — | | | 49 | | | Off-system sales, capacity, and FAC revenues, net | 69 | | | — | | | — | | | — | | | — | | | 69 | | |
| Energy-efficiency program investment revenues | — | | | 5 | | | — | | | — | | | — | | | 5 | | | |
| Ameren Illinois energy-efficiency program investment revenues | | Ameren Illinois energy-efficiency program investment revenues | — | | | 10 | | | — | | | — | | | — | | | 10 | | |
| Other | Other | 4 | | | 6 | | | — | | | — | | | (9) | | | 1 | | | Other | 5 | | | 6 | | | — | | | — | | | (5) | | | 6 | | |
Cost recovery mechanisms – offset in fuel and purchased power(d) | Cost recovery mechanisms – offset in fuel and purchased power(d) | 14 | | | 24 | | | — | | | — | | | — | | | 38 | | | Cost recovery mechanisms – offset in fuel and purchased power(d) | 41 | | | 37 | | | — | | | — | | | (10) | | | 68 | | |
Other cost recovery mechanisms(e) | Other cost recovery mechanisms(e) | (1) | | | — | | | — | | | — | | | — | | | (1) | | | Other cost recovery mechanisms(e) | (22) | | | 1 | | | — | | | — | | | — | | | (21) | | |
| Total electric revenue change | Total electric revenue change | $ | 28 | | | $ | 57 | | | $ | — | | | $ | 7 | | | $ | (9) | | | $ | 83 | | | Total electric revenue change | $ | 157 | | | $ | 94 | | | $ | — | | | $ | 26 | | | $ | (15) | | | $ | 262 | | |
| Fuel and purchased power change: | Fuel and purchased power change: | | | | | | | Fuel and purchased power change: | | |
| Energy costs (excluding the estimated effect of weather) | Energy costs (excluding the estimated effect of weather) | $ | (53) | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | (53) | | | Energy costs (excluding the estimated effect of weather) | $ | (76) | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | (76) | | |
Effect of weather (estimate)(b) | Effect of weather (estimate)(b) | (6) | | | — | | | — | | | — | | | — | | | (6) | | | Effect of weather (estimate)(b) | (7) | | | — | | | — | | | — | | | — | | | (7) | | |
| Effect of lower net energy costs included in base rates | Effect of lower net energy costs included in base rates | 36 | | | — | | | — | | | — | | | — | | | 36 | | | Effect of lower net energy costs included in base rates | 36 | | | — | | | — | | | — | | | — | | | 36 | | |
| | Other | Other | (4) | | | 1 | | | — | | | — | | | 8 | | | 5 | | | Other | (5) | | | — | | | — | | | — | | | 2 | | | (3) | | |
Cost recovery mechanisms – offset in electric revenue(d) | Cost recovery mechanisms – offset in electric revenue(d) | (14) | | | (24) | | | — | | | — | | | — | | | (38) | | | Cost recovery mechanisms – offset in electric revenue(d) | (41) | | | (37) | | | — | | | — | | | 10 | | | (68) | | |
| Total fuel and purchased power change | Total fuel and purchased power change | $ | (41) | | | $ | (23) | | | $ | — | | | $ | — | | | $ | 8 | | | $ | (56) | | | Total fuel and purchased power change | $ | (93) | | | $ | (37) | | | $ | — | | | $ | — | | | $ | 12 | | | $ | (118) | | |
| Net change in electric margins | Net change in electric margins | $ | (13) | | | $ | 34 | | | $ | — | | | $ | 7 | | | $ | (1) | | | $ | 27 | | | Net change in electric margins | $ | 64 | | | $ | 57 | | | $ | — | | | $ | 26 | | | $ | (3) | | | $ | 144 | | |
| Natural gas revenue change: | Natural gas revenue change: | | | | | | | Natural gas revenue change: | | |
Effect of weather (estimate)(b) | Effect of weather (estimate)(b) | $ | 3 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 3 | | | Effect of weather (estimate)(b) | $ | 2 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | 2 | | |
| Base rates (estimate) | Base rates (estimate) | — | | | — | | | 16 | | | — | | | — | | | 16 | | | Base rates (estimate) | — | | | — | | | 18 | | | — | | | — | | | 18 | | |
| Change in rate design | Change in rate design | — | | | — | | | 8 | | | — | | | — | | | 8 | | | Change in rate design | — | | | — | | | (3) | | | — | | | — | | | (3) | | |
| | QIP rider | | QIP rider | — | | | — | | | 3 | | | — | | | — | | | 3 | | |
| | Other | Other | — | | | — | | | 5 | | | — | | | — | | | 5 | | | Other | 1 | | | — | | | 1 | | | — | | | — | | | 2 | | |
Cost recovery mechanisms – offset in natural gas purchased for resale(d) | Cost recovery mechanisms – offset in natural gas purchased for resale(d) | 10 | | | — | | | 68 | | | — | | | — | | | 78 | | | Cost recovery mechanisms – offset in natural gas purchased for resale(d) | 9 | | | — | | | 81 | | | — | | | — | | | 90 | | |
Other cost recovery mechanisms(e) | Other cost recovery mechanisms(e) | — | | | — | | | 7 | | | — | | | — | | | 7 | | | Other cost recovery mechanisms(e) | — | | | — | | | 9 | | | — | | | — | | | 9 | | |
| Total natural gas revenue change | Total natural gas revenue change | $ | 13 | | | $ | — | | | $ | 104 | | | $ | — | | | $ | — | | | $ | 117 | | | Total natural gas revenue change | $ | 12 | | | $ | — | | | $ | 109 | | | $ | — | | | $ | — | | | $ | 121 | | |
| Natural gas purchased for resale change: | Natural gas purchased for resale change: | | | Natural gas purchased for resale change: | | |
Effect of weather (estimate)(b) | Effect of weather (estimate)(b) | $ | (2) | | | $ | — | | | $ | — | | | $ | — | | | — | | | $ | (2) | | | Effect of weather (estimate)(b) | $ | (2) | | | $ | — | | | $ | — | | | $ | — | | | $ | — | | | $ | (2) | | |
| Other | — | | | — | | | (1) | | | — | | | — | | | (1) | | | |
| Cost recovery mechanisms – offset in natural gas revenue(d) | Cost recovery mechanisms – offset in natural gas revenue(d) | (10) | | | — | | | (68) | | | — | | | — | | | (78) | | | Cost recovery mechanisms – offset in natural gas revenue(d) | (9) | | | — | | | (81) | | | — | | | — | | | (90) | | |
| Total natural gas purchased for resale change | Total natural gas purchased for resale change | $ | (12) | | | $ | — | | | $ | (69) | | | $ | — | | | $ | — | | | $ | (81) | | | Total natural gas purchased for resale change | $ | (11) | | | $ | — | | | $ | (81) | | | $ | — | | | $ | — | | | $ | (92) | | |
| Net change in natural gas margins | Net change in natural gas margins | $ | 1 | | | $ | — | | | $ | 35 | | | $ | — | | | $ | — | | | $ | 36 | | | Net change in natural gas margins | $ | 1 | | | $ | — | | | $ | 28 | | | $ | — | | | $ | — | | | $ | 29 | | |
(a)Includes an increase in transmission margins of $1$17 million and $8$25 million at Ameren Illinois for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods.
(b)Represents the estimated variation resulting primarily from changes in cooling and heating degree-days on electric and natural gas demand compared with the year-ago periods; this variation is based on temperature readings from the National Oceanic and Atmospheric Administration weather stations at local airports in our service territories.
(c)For Ameren Illinois Electric Distribution and Ameren Transmission, base rates include increases or decreases to operating revenues related to the revenue requirement reconciliation adjustment under formula rates. For Ameren Missouri, base rates exclude an increase of $7 million for the recovery of lost electric margins for the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period, resulting from the MEEIA 2016 and 2019 customer energy-efficiency programs. This amount is included in the “sales volumes and changes in customer usage patterns (excluding the estimated effects of weather and MEEIA)” line item.
(d)Electric and natural gas revenue changes are offset by corresponding changes in “Fuel,” “Purchased power,” and “Natural gas purchased for resale” on the statement of income, resulting in no change to electric and natural gas margins. Activity in Other/Intersegment Eliminations represents the elimination of Ameren Transmission revenue from transmission services provided to Ameren Illinois Electric Distribution. See Note 16 – Segment Information under Part II, Item 8, of the Form 10-K for additional information on intersegment eliminations.
(e)Offsetting expense increases or decreases are reflected in “Other operations and maintenance,” “Depreciation and amortization,” or in “Taxes other than income taxes,” within the “Operating Expenses” section and "Income Taxes" in the statement of income. These items have no overall impact on earnings.
Ameren
Ameren’s electric margins decreased $27increased $117 million, or 3%10%, and $144 million, or 5%, for the three and nine months ended September 30, 2021, respectively, compared with the year-ago periods, due to increased margins at Ameren Missouri, Ameren Illinois Electric Distribution and Ameren Transmission, as discussed below. Ameren’s natural gas margins decreased $7 million, or 7%, for the three months ended JuneSeptember 30, 2021, compared with the year-ago period, and increased $29 million, or 7%, for the nine months ended September 30, 2021, compared with the year-ago period, primarily because of decreased margins at Ameren Missouri, partially offset by increased margins at Ameren Illinois Electric Distribution, as discussed below. Ameren’s electric margins increased $27 million, or 1%, for the six months ended June 30, 2021, compared with the year-ago periods, primarily because of increased margins at Ameren Illinois Electric Distribution and Ameren Transmission, partially offset by decreased margins at Ameren Missouri, as discussed below. Ameren’s natural gas margins increased $4 million, or 3%, and $36 million, or 11%, for the three and six months ended June 30, 2021, respectively, compared with the year-ago periods, primarily because of increased marginsmargin variations at Ameren Illinois Natural Gas, as discussed below.
Ameren Transmission
Ameren Transmission’s margins were comparable between the three months ended June 30, 2021 and 2020. Ameren Transmission’s margins increased $7$19 million, or 3%13%, and $26 million, or 7%, for the sixthree and nine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago period.periods. Base rate revenues were favorably affected by increased capital investment (+$8 million and +$18 million, respectively), as evidenced by a 12% increase in rate base used to calculate the revenue requirement, and higher recoverable expenses (+$11 million and +$25 million, respectively). These increases were partially offset by the absence in 2021 of the FERC’s May 2020 order addressing the allowed base ROE, and the effect of the FERC’s March 2021 order (-$17 million for the nine months ended September 30, 2021), which required refunds primarily related to historical recovery of materials and supplies inventories. See Transmission Formula Rate Revisions in Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report for additional information regarding the May 2020 and March 2021 FERC orders.
Ameren Missouri
Ameren Missouri’s electric margins decreased $49increased $77 million, or 8%10%, and $13$64 million, or 1%3%, for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods. FuelRevenues associated with “Cost recovery mechanisms – offset in fuel and purchased power costspower” increased $11$27 million and $14$41 million for the three and sixnine months ended JuneSeptember 30, 2021, respectively,respectively. The increased revenues are fully offset by an increase in fuel and purchased power costs, which increased primarily resulting fromdue to higher electric prices, the Callaway Energy Center maintenance outage, and, for the six monthnine-month comparison, a significant increase in customer demand for electricity in mid-February 2021 due to extremely cold weather. The increased fuel and purchased power costs were fully offset by an increase in electric revenues, resulting in no impactchanges to margin. The increase in purchased power cost is reflected in “Cost recovery mechanisms – offset in electric revenue” and the associated recoverability from customers is reflected in “Cost recovery mechanisms –- offset in fuel and purchased power” are fully offset by “Cost recovery mechanisms - offset in electric revenue,” in the table above.above, and result in no impact to margins. Ameren Missouri’s 5% exposure to net energy costs variances under the FAC is reflected within “Off-system sales, capacity and FAC revenues, net” and “Energy costs (excluding the estimated effect of weather)”.
The following items had an unfavorablea favorable effect on Ameren Missouri’s electric margins for the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods (except when a specific period is referenced):
•The implementation of a change in rate design pursuant to the March 2020 MoPSC electric rate order decreasedincreased margins $63$64 million in both periods.for the three months ended September 30, 2021. The change in rate design applies lower winter rates to May sales volumes and higher summer rates to September sales volumes beginning in 2021. Previously, blended rates were applied in both months’ sales volumes. As the decreaseincrease in margins associated with September sales volumes was largely offset by decreased margins associated with May sales volumes, is expectedthe change did not materially affect margin comparisons for the nine months ended September 30, 2021.
•Excluding the estimated effects of weather and the MEEIA customer energy-efficiency programs, electric sales revenues increased an estimated $24 million and $34 million, respectively. The increase was primarily due to bean increase in retail sales volumes, which were unfavorably affected by the COVID-19 pandemic in 2020, partially offset by increases associated with Septembera decrease in the average retail price per kilowatthour due to changes in customer usage patterns. While the MEEIA customer energy-efficiency programs reduced retail sales volumes, the change is not expected to materially affect annual earnings comparisons.
•The absencerecovery of the Callaway Energy Center generation and extremely cold weather in mid-February 2021, partially offset by insurance recoveries related to the Callaway Energy Center maintenance outage, drove net energy costs higher than those reflected in base rates, which reducedlost electric margins by $4 million, resulting from Ameren Missouri’s 5% exposure to net energy cost variances under the FAC for the six months ended June 30, 2021. The change in net energy costs is the sum of the revenue change in “Off-system sales, capacity and FAC revenues, net” (+$49 million) and the change in “Energy costs (excluding the estimated effect of weather)” (-$53 million) in the table above. See Note 10 – Callaway Energy Center under Part I, Item 1, of this report for additional information on insurance recoveries related to the outage.
The following items had a favorable effect on Ameren Missouri’sMEEIA ensured that electric margins for three and six months ended June 30, 2021, compared with the year-ago periods (except when a specific period is referenced):were not affected.
•The March 2020 MoPSC electric rate order that resulted in lower net energy costs included in base rates, partially offset by lower electric base rates, increased margins $30 million for the sixnine months ended JuneSeptember 30, 2021. The change in electric base rates is the sum of the change in “Base rates (estimate)” (-$6 million) and the “Effect of lower net energy costs included in base rates” (+$36 million) in the table above.
•Excluding the estimated effects of weather and the MEEIA customer energy-efficiency programs, electric revenues increased an estimated $11 million and $8 million, respectively. The increase was primarily due to an increase in sales volumes, which were unfavorably affected by the COVID-19 pandemic in 2020, and an increase in the average retail price per kilowatthour due to changes in customer usage patterns. While the MEEIA customer energy-efficiency programs reduced retail sales volumes, the recovery of lost electric margins under the MEEIA ensured that electric margins were not affected.
•Summer temperatures were warmer as cooling degree days increased 7%2% for the three months ended JuneSeptember 30, 2021, and winter temperatures were colder as heating degree days increased 7% for the sixnine months ended JuneSeptember 30, 2021. The aggregate effect of
weather increased margins an estimated $4$9 million and $17$26 million, respectively. The change in margins due to weather is the sum of the “Effect of weather (estimate)” on electric revenues (+$510 million and +$2333 million, respectively) and the “Effect of weather (estimate)” on fuel and purchased power”power (-$1 million and -$67 million, respectively) in the table above.
The following items had an unfavorable effect on Ameren Missouri’s electric margins for the three and nine months ended September 30, 2021, compared with the year-ago periods (except when a specific period is referenced):
•LowerOther cost recovery mechanisms decreased margins $21 million and $22 million, respectively, primarily due to decreased RESRAM revenues as a result of increased production tax credits, which are refunded to customers.
•Higher net energy costs increaseddecreased margins $1$3 million and $7 million, respectively. The higher net energy costs were attributable to an increase in retail sales volumes and Ameren Missouri’s exposure to net energy cost variances under the FAC. An increase in retail sales volumes, which were unfavorably affected by the COVID-19 pandemic in 2020, decreased margins $3 million for the three and nine months ended JuneSeptember 30, 2021. The changeabsence of the Callaway Energy Center generation and extremely cold weather in mid-February 2021, partially offset by insurance recoveries related to the unplanned Callaway Energy Center maintenance outage, drove net energy costs higher than those reflected in base rates, which reduced margins by $4 million, resulting from Ameren Missouri’s 5% exposure to net energy cost variances under the FAC for the nine months ended September 30, 2021. The change in net energy costs is the sum of “Off-system sales, capacity and FAC revenues, net” (+$54 million)19 million and +$69 million, respectively) and “Energy costs (excluding the estimated effect of weather)” (-$53 million)22 million and -$76 million, respectively) in the table above.
Ameren Missouri’s natural gas margins were comparable between periods. Purchased gas costs increased $10$9 million for the sixnine months ended JuneSeptember 30, 2021, primarily resulting from the significant increase in customer demand and prices for natural gas in mid-February 2021 due to extremely cold weather. The increased purchased gas costs are fully offset by an increase in natural gas revenues under the PGA rider, resulting in no impact to margin. The increase in purchased gas cost is reflected in “Cost recovery mechanisms – offset in natural gas revenue” and the associated recoverability from customers is reflected in “Cost recovery mechanisms – offset in natural gas purchased for resale” in the table above.
Ameren Illinois
Ameren Illinois’ electric margins increased $26$40 million, or 7%11%, and $42$82 million, or 6%8%, for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods, driven by increased margins at Ameren Illinois Electric Distribution and Ameren Illinois Transmission. Ameren Illinois Natural Gas’ margins increased $4decreased $7 million, or 4%8%, and $35increased $28 million, or 12%7%, for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods.
Ameren Illinois Electric Distribution
Ameren Illinois Electric Distribution’s margins increased $25$23 million, or 9%8%, and $34$57 million, or 6%7%, for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods. Purchased power costs increased $11$13 million and $24$37 million for the three and sixnine months ended JuneSeptember 30, 2021, respectively, primarily resulting from higher electric prices and, for the six monthnine-month comparison, the significant increase in customer demand for electricity in mid-February 2021 due to extremely cold weather. The increased purchased power costs are fully offset by an increase in electric revenues under the cost recovery mechanisms for purchased power, resulting in no impact to margin. The increase in purchased power cost is reflected in “Cost recovery mechanisms – offset in electric revenue” and the associated recoverability from customers is reflected in “Cost recovery mechanisms – offset in fuel and purchased power” in the table above.
The following items had a favorable effect on Ameren Illinois Electric Distribution’s margins for the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods:
•MarginsBase rates increased due to a higher recognized ROE (+$41 million and +$7 million,8 million, respectively), as evidenced by an increase of 7458 basis points in the estimated annual average of the monthly yields of the 30-year United States Treasury bonds, increased capital investment (+$2 million and +$46 million, respectively), as evidenced by a 7%increase in rate base used to calculate the revenue requirement, and higher recoverable non-purchased power expenses (+$138 million and +$1119 million, respectively), and revenue requirement reconciliation adjustment true-ups (+$4 million and +$7 million, respectively). The sum of these changes collectively increased margins $19$15 million and $22$40 million, respectively.
•Revenues increased $2$4 million and $5$10 million, respectively, due to the recovery of and return on increased energy-efficiency program investments under performance-based formula ratemaking.
Ameren Illinois Natural Gas
Ameren Illinois Natural Gas’ margins increased $4decreased $7 million, or 4%8%, and $35increased $28 million, or 12%7%, for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods. Purchased gas costs increased $24$12 million and $68$81 million forfor the three and sixnine months ended JuneSeptember 30, 2021, respectively, primarily resulting from higher natural gas prices and, for the six monthnine-month comparison, the significant increase in customer demand for natural gas in mid-February 2021 due to extremely cold weather. The increased purchased gas costs are fully offset by an increase in natural gas revenues under the PGA rider, resulting in no impact to margin. The increase in purchased gas cost is reflected in “Cost recovery mechanisms – offset in natural gas revenue” and the associated recoverability from customers is reflected in “Cost recovery mechanisms – offset in natural gas purchased for resale” in the table above. The following items had a favorable effect on Ameren Illinois Natural Gas’ margins for the three and six months ended June 30, 2021, compared with the year-ago periods (except when a specific period is referenced):
•Revenues increased $4 million and $16 million, respectively, due to higher natural gas base rates as a result of the January 2021 natural gas rate order.
•The implementation of a change in rate design pursuant to the January 2021 natural gas rate order which increased margins $8resulted in decreased revenues of $11 million and $3 million for the sixthree and nine months ended JuneSeptember 30, 2021.2021, respectively, compared with the year-ago periods. This change in rate design concentrates more revenues in the winter heating season due to an increase in volumetric rates and a decrease in fixed customer rates. As such, theThe change is not expected to materially affect annual earnings comparisons.
The following items had a favorable effect on Ameren Illinois Natural Gas’ margins decreasedfor the three and nine months ended September 30, 2021, compared with the year-ago periods (except when a specific period is referenced):
•Revenues increased $2 million and $18 million,respectively, due to the implementationhigher natural gas base rates as a result of a change in rate design pursuant to the January 2021 natural gas rate order, which decreasedorder.
•Other cost recovery mechanisms increased margins $4$9 million for the threenine months ended JuneSeptember 30, 2021. As noted above,2021, compared with the change is not expectedyear-ago period, primarily due to materially affect annual earnings comparisons.increased revenues for excise taxes and gross receipts taxes.
Ameren Illinois Transmission
Ameren Illinois Transmission’s margins increased $1$17 million, or 1%19%, and $8$25 million, or 5%10%, for the three and sixnine months ended JuneSeptember 30, 2021, respectively, compared with the year-ago periods. Margins were favorably affected by increased capital investment (+$8 million and +$18 million, respectively), as evidenced by a 18%19% increase in rate base used to calculate the revenue requirement, partiallyand higher recoverable expenses (+$9 million and +$20 million, respectively). These increases were partially offset by the absence in 2021 of the FERC’s May 2020 order addressing the allowed base ROE, and the effect of the FERC’s March 2021 order (-$13 million for the nine months ended September 30, 2021), which required refunds primarily related to historical recovery of materials and supplies inventories. See Transmission Formula Rate Revisions in Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report for additional information regarding the May 2020 and March 2021 FERC orders.
Other Operations and Maintenance Expenses
| | | | | | | | | | | | | | | | | | | | |
| | | Increase (Decrease) by Segment | |
| | | Overall Ameren Increase of $28$39 Million (QTD YoY) | | Overall Ameren Increase of $10$49 Million (YTD YoY) | |
| Total by Segment(a) | | | |
(a)Includes $14$16 million and $15$14 million at Ameren Transmission in the three months ended June 30, 2021 and 2020, respectively. Includes other/intersegment eliminations of $(2) million and $(3) million in the three months ended JuneSeptember 30, 2021 and 2020, respectively. Also includes other/intersegment eliminations of $(4)$(2) million and $(5)$(2) million in the sixthree months ended JuneSeptember 30, 2021 and 2020, respectively, and $(6) million and $(7) million in the nine months ended September 30, 2021 and 2020, respectively.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Natural Gas | | | Other/Intersegment Eliminations |
| | | | | | | | | |
| | Ameren Illinois Electric Distribution | | Ameren Transmission | | | | |
Ameren
Other operations and maintenance expenses increased $28$39 million and $10$49 million in the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods, due tobecause of changes discussed below.
Ameren Transmission
Other operations and maintenance expenses were comparable between periods.
Ameren Missouri
Other operations and maintenance expenses increased $16 million infor the three months ended JuneSeptember 30, 2021, compared with the year-ago period. Other operations and maintenance expenses were comparable between$3 million higher in the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period, primarily due to increased transmission maintenance activity at Ameren Illinois Transmission.
Ameren Missouri
Other operations and 2020.maintenance expenses increased $19 million and $21 million in the three and nine months ended September 30, 2021, compared with the year-ago periods. The
following items increased other operations and maintenance expenses in the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods (except where a specific period is referenced):
•Callaway Energy Center refueling operations and maintenance costs increased $7 million and $14$21 million, respectively, because of the amortization of those costs, beginning in January 2021, which were previously deferred as a regulatory asset, pursuant to the MoPSC’s February 2020 order.
•Energy center maintenance costs, other than Callaway refueling and maintenance costs, increased $6$9 million and $7$16 million, respectively, primarily duebecause of costs related to new wind generation facilities, which are recovered under the RESRAM, and the deferral of projects in the year-ago period.periods.
•Customer energy-efficiency program costs increased $8$7 million in the sixnine months ended JuneSeptember 30, 2021, because of increased participation in the MEEIA programs in the current-year period.
•Transmission and distribution expenditures increased $7 million in the three months ended September 30, 2021, primarily because of increased storm costs.
•The cash surrender value of company-owned life insurance decreased $5 million in the three months ended September 30, 2021 because of less favorable market returns in the threeyear-ago period.
•Technology-related expenditures increased $4 million in the nine months ended JuneSeptember 30, 2021, comparedprimarily because of costs associated with the year-ago period.implementation and maintenance of cloud computing technology.
The following items partially offset the above increases in other operations and maintenance expenses in the sixthree and nine months ended JuneSeptember 30, 2021, compared with the year-ago period:periods (except where a specific period is referenced):
•Amortization of costs,regulatory balances, primarily solar rebate costs pursuant to the MoPSC’s March 2020 electric rate order, decreased $8 million.$10 million in the nine months ended September 30, 2021.
•TransmissionLabor and distribution expendituresbenefit costs decreased $6$7 million and $9 million, respectively, primarily due to higher capitalization of costs resulting from less maintenance and meter reading costs, because of recent capital improvements related to the Smart Energy Plan.increased construction activity.
•Deferral to a regulatory asset of $5 million, in the nine months ended September 30, 2021, of certain prior period costs incurred related to the COVID-19 pandemic, pursuant to the MoPSC’s March 2021 orders.
•The cash surrender value of company-owned life insurance increasedExpenses decreased $3 million and $4 million, respectively, because of more favorable market returnsincreased bad debt costs in the six months ended June 30, 2021, compared withyear-ago periods largely due to the year-ago period.COVID-19 pandemic.
Ameren Illinois
Other operations and maintenance expenses increased $11$20 million and $6$26 million in the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods, as discussed below. Other operations and maintenance expenses were comparable between periods at Ameren Illinois Natural Gas and Ameren Illinois Transmission.
Ameren Illinois Electric Distribution
Other operations and maintenance expenses increased $11$15 million and $6$21 million in the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods. The following items increased other operations and maintenance expenses in the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods (except where a specific period is referenced):
•Employee benefit costs increased $3 million and $4 million, respectively, primarily because of higher medical and pension costs.
•Amortization of regulatory assets associated with energy-efficiency program investments under performance-based formula ratemaking increased $2 million and $6 million, respectively.
•Expenses increased $5 million in both periods, resulting from the true-up of vegetation management expenditures pursuant to the 2020 revenue requirement reconciliation adjustment.
•Increased bad debt expense of $5 million in the nine months ended September 30, 2021, primarily because of increased recovery of bad debt costs allowed by the ICC.
•Power restoration assistance provided to other utilities increased $3 million and $4 million, respectively.
•DistributionTechnology-related expenditures increased $3 million in the threenine months ended JuneSeptember 30, 2021, primarily because of increased storm costs.costs associated with implementation and maintenance of cloud computing technology.
•The cash surrender value of company-owned life insurance decreased $2 million in the three months ended September 30, 2021 because of less favorable market returns in the threeyear-ago period.
The above increases in the nine months ended JuneSeptember 30, 2021 were partially offset by a $4 million reduction in environmental remediation rider costs, resulting from a decline in the remediation efforts needed.
Ameren Illinois Natural Gas
Other operations and maintenance expenses increased $3 million in both the three and nine months ended September 30, 2021, compared with the year-ago period.periods, primarily because of the absence in 2021 of miscellaneous amortizations of regulatory liabilities, which lowered expenses in 2020.
Ameren Illinois Transmission
Other operations and maintenance expenses were comparable between the three months ended September 30, 2021 and 2020. Other operations and maintenance expenses were $3 million higher in the nine months ended September 30, 2021, compared with the year-ago period, primarily due to increased transmission maintenance activity.Depreciation and Amortization Expenses
| | | | | | | | | | | | | | | | | | | | |
| | | Increase (Decrease) by Segment |
| | | Overall Ameren Increase of $14$17 Million (QTD YoY) | | Overall Ameren Increase of $40$57 Million (YTD YoY) | |
| Total by Segment(a) | | | |
(a)Includes other/intersegment eliminations of $2$22 million and $2$21 million at Ameren Illinois Natural Gas, in the three months ended JuneSeptember 30, 2021 and 2020, respectively. Also includes other/intersegment eliminations of $2$1 million and $2 million in the sixthree months ended JuneSeptember 30, 2021 and 2020, respectively, and $3 million and $4 million in the nine months ended September 30, 2021 and 2020, respectively.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Natural Gas | | | Other/Intersegment Eliminations |
| | | | | | | | | |
| | Ameren Illinois Electric Distribution | | Ameren Transmission | | | | |
Depreciation and amortization expenses increased $14$17 million, $9 million, and $10$7 million in the three months ended JuneSeptember 30, 2021, and $40$57 million, $27 million, and $18$26 million in the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods, at Ameren, Ameren Illinois, and Ameren Illinois,Missouri, respectively, primarily because of additional property, plant, and equipment investments across their respective segments. Depreciation and amortization expenses were comparable at Ameren Missouri between the three months ended June 30, 2021 and 2020. Depreciation and amortization expenses increased $19 million at Ameren Missouri in the six months ended June 30, 2021, compared with the year-ago period, primarily because of additional property, plant, and equipment investments. Ameren’s and Ameren Missouri’s depreciation and amortization expenses reflected a deferral to a regulatory asset of depreciation and amortization expenses pursuant to the PISA and the RESRAM. The PISA and RESRAM deferrals of depreciation and amortization expenses were $22$27 million and $1$2 million for the three months ended JuneSeptember 30, 2021 and 2020, respectively, and $41$68 million and $14$16 million for the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively.
Taxes Other Than Income Taxes
| | | | | | | | | | | | | | | | | | | | |
| | | Increase (Decrease) by Segment | |
| | | Overall Ameren Increase of $3$14 Million (QTD YoY) | | Overall Ameren Increase of $6$20 Million (YTD YoY) | |
| Total by Segment(a) | | | |
(a)Includes $2 million $2 million, $4 million, and $4$2 million at Ameren Transmission in the three months ended JuneSeptember 30, 2021 and 2020, respectively, and $6 million and $6 million in the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively. Also includes other/intersegment eliminations of $2 million, $2 million, $6$3 million and $5$2 million in the three months ended JuneSeptember 30, 2021 and 2020, respectively, and $9 million and $7 million in the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Natural Gas | | | Other/Intersegment Eliminations |
| | | | | | | | | |
| | Ameren Illinois Electric Distribution | | Ameren Transmission | | | | |
Taxes other than income taxes increased $3$14 million at Ameren in the three months ended June 30, 2021, compared with the year-ago period, primarily because of increased property taxes across Ameren segments. Taxes other than income taxes were comparable at Ameren Missouri and Ameren Illinois between the three months ended June 30, 2021 and 2020. Taxes other than income taxes increased $6 million at Ameren and Ameren Illinois in the six months ended JuneSeptember 30, 2021, compared with the year-ago period, primarily because of a $4$9 million increase in excise taxes at Ameren Illinois Natural Gas, as a result ofMissouri resulting from increased sales. Taxes other than income taxes were comparableincreased $20 million in the nine months ended September 30, 2021, compared with the year-ago period, primarily because of $9 million and $5 million increases in excise taxes due to increased sales at Ameren Missouri betweenand Ameren Illinois Natural Gas, respectively. Taxes other than income taxes also increased $4 million at Ameren Missouri in the sixthree and nine months ended JuneSeptember 30, 2021, compared with the year-ago periods, because of increased property taxes, primarily resulting from the addition of wind generation property and 2020.higher assessed values, partially offset by lower natural gas property taxes.
Other Income, Net
| | | | | | | | | | | | | | | | | | | | |
| | | Increase (Decrease) by Segment | |
| | | Overall Ameren Increase of $1$8 Million (QTD YoY) | | Overall Ameren Increase of $26$34 Million (YTD YoY) | |
| Total by Segment(a) | | | |
(a)Includes $2$5 million and $3$4 million at Ameren Transmission in the three months ended JuneSeptember 30, 2021 and 2020, respectively.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Natural Gas | | | Other/Intersegment Eliminations |
| | | | | | | | | |
| | Ameren Illinois Electric Distribution | | Ameren Transmission | | | | |
Other income, net, was comparable at Ameren, Ameren Missouri, and Ameren Illinois betweenincreased $8 million in the three months ended June 30, 2021 and 2020. Other income, net, increased $26 million and $18 million at Ameren and Ameren Missouri, respectively, in the six months ended JuneSeptember 30, 2021, compared with the year-ago period, primarily because of activity not reported as part of a $9 millionsegment, resulting from increased income from equity method investments and an increase in the non-service cost components of net periodic benefit income. Other income, atnet, increased $34 million in the nine months ended September 30, 2021,compared with the year-ago period, primarily because of the following items:
•The non-service cost component of net periodic benefit income increased $9 million, $4 million, and $3 million for Ameren Missouri, Ameren Illinois Electric Distribution, and anactivity not reported as part of a segment, respectively.
•Charitable contributions were $8 million decrease in charitable donationslower at Ameren Missouri due to the absence of charitable donations made in the year-ago period pursuant to the MoPSC’s March 2020 electric rate order. Other income, net, also
•Income from equity method investments increased $6 million at Ameren in the six months ended June 30, 2021, compared with the year-ago period for activity not reported as part of a segment, primarily because of increased income from equity method investments. Other income, net was comparable at Ameren Illinois between the six months ended June 30, 2021 and 2020.segment.
See Note 5 – Other Income, Net, under Part I, Item 1, of this report for additional information. See Note 11 – Retirement Benefits under Part I, Item 1, of this report for more information on the non-service cost components of net periodic benefit income.
Interest Charges
| | | | | | | | | | | | | | | | | | | | |
| | | Increase (Decrease) by Segment | |
| | | Overall Ameren Decrease of $12$16 Million (QTD YoY) | | Overall Ameren Decrease of $5$21 Million (YTD YoY) | |
| Total by Segment | | | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Ameren Missouri | | | Ameren Illinois Natural Gas | | | Other/Intersegment Eliminations |
| | | | | | | | | |
| | Ameren Illinois Electric Distribution | | Ameren Transmission | | | | |
Interest charges decreased $12$16 million and $14$18 million in the three months ended JuneSeptember 30, 2021, and $5$21 million and $15$33 million in the sixnine months ended JuneSeptember 30, 2021, at Ameren and Ameren Missouri, respectively, compared with the year-ago periods, primarily because of increased deferrals to a regulatory asset of interest charges pursuant to the PISA and the RESRAM. The PISA and RESRAM deferrals of interest charges were $19$22 million and less than $1 million in the three months ended JuneSeptember 30, 2021 and 2020, respectively, and $34$56 million and $9 million in the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively. Interest charges were comparable at Ameren Illinois between the three months ended JuneSeptember 30, 2021 and 2020. Interest charges increased $5$7 million at Ameren Illinois in the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period.period, as discussed below.
The following items partially offset the decreases in interest charges in the three and sixnine months ended JuneSeptember 30, 2021, compared with the year-ago periods (except where a specific period is referenced):
•IssuanceIssuances of long-term debt at Ameren Missouri in October 2020 and June 2021 collectively increased interest charges by $4$7 million and $7$14 million, respectively.
•Issuance of long-term debt at Ameren (parent) in April 2020 increased interest charges by $7 million in the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period.
•Interest charges at Ameren Illinois Transmission increased by $4$5 million in the sixnine months ended JuneSeptember 30, 2021, compared with the year-ago period, at Ameren Illinois Transmissionprimarily as a result of the FERC’s March 2021 order and the Ameren Illinois issuance of long-term debt in November 2020.
Income Taxes
The following table presents effective income tax rates for the three and sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | | | Three Months(a) | | Six Months(a) | | | | Three Months(a) | | Nine Months(a) |
| | | | 2021 | | 2020 | | 2021 | | 2020 | | | | 2021 | | 2020 | | 2021 | | 2020 |
| Ameren | Ameren | | | 13 | % | | 17 | % | | 12 | % | | 15 | % | Ameren | | | 14 | % | | 15 | % | | 13 | % | | 15 | % |
| Ameren Missouri | Ameren Missouri | | | (3) | % | | 7 | % | | (3) | % | | 7 | % | Ameren Missouri | | | (1) | % | | 6 | % | | (1) | % | | 6 | % |
| Ameren Illinois | Ameren Illinois | | | 26 | % | | 26 | % | | 25 | % | | 25 | % | Ameren Illinois | | | 25 | % | | 24 | % | | 25 | % | | 25 | % |
| Ameren Illinois Electric Distribution | Ameren Illinois Electric Distribution | | | 25 | % | | 25 | % | | 24 | % | | 24 | % | Ameren Illinois Electric Distribution | | | 24 | % | | 21 | % | | 24 | % | | 23 | % |
| Ameren Illinois Natural Gas | Ameren Illinois Natural Gas | | | 29 | % | | 29 | % | | 27 | % | | 26 | % | Ameren Illinois Natural Gas | | | 21 | % | | (b) | | 28 | % | | 26 | % |
| Ameren Illinois Transmission | Ameren Illinois Transmission | | | 25 | % | | 27 | % | | 25 | % | | 26 | % | Ameren Illinois Transmission | | | 26 | % | | 25 | % | | 26 | % | | 26 | % |
| Ameren Transmission | Ameren Transmission | | | 26 | % | | 27 | % | | 26 | % | | 27 | % | Ameren Transmission | | | 26 | % | | 26 | % | | 26 | % | | 27 | % |
|
(a)Estimate of the annual effective income tax rate adjusted to reflect the tax effect of items discrete to the three and sixnine months ended JuneSeptember 30, 2021 and 2020.
(b)Not meaningful because of the insignificant amount of income before income taxes.
See Note 12 – Income Taxes under Part I, Item 1, of this report for a reconciliation of the federal statutory corporate income tax rate to the effective income tax rate for the Ameren Companies.
The effective income tax rate was lowerhigher at Ameren Illinois TransmissionElectric Distribution in the three months ended JuneSeptember 30, 2021, compared with the year-ago period, primarily because of decreased tax benefits from certain depreciation differences on property-related items largely attributable to lower amortization of excess deferred taxes, compared with the year-ago period.
The effective income tax rate was higher at Ameren Illinois Natural Gas in the nine months ended September 30, 2021, compared with the year-ago period, primarily because of decreased tax benefits from certain depreciation differences on property-related items largely attributable to the allowance for equity funds used during construction, and higher amortization of excess deferred taxes, compared with the year-ago period.
LIQUIDITY AND CAPITAL RESOURCES
Collections from our tariff-based revenues are our principal source of cash provided by operating activities. A diversified retail customer mix, primarily consisting of rate-regulated residential, commercial, and industrial customers, provides us with a reasonably predictable source of cash. In addition to using cash provided by operating activities, we use available cash, drawings under committed credit agreements, commercial paper issuances, and/or, in the case of Ameren Missouri and Ameren Illinois, short-term affiliate borrowings to support normal operations and temporary capital requirements. We may reduce our short-term borrowings with cash provided by operations or, at our discretion, with long-term borrowings, or, in the case of Ameren Missouri and Ameren Illinois, with capital contributions from Ameren (parent). We expect to make significant capital expenditures over the next five years, supported by a combination of long-term debt and equity, as we invest in our electric and natural gas utility infrastructure to support overall system reliability, grid modernization, renewable energy target requirements, environmental compliance, and other improvements. As part of its funding plan for capital expenditures, Ameren is using newly issued shares of common stock, rather than market-purchased shares, to satisfy requirements under the DRPlus and employee benefit plans and expects to continue to do so through at least 2025. Ameren expects these issuances to provide equity of about $100 million annually. In addition, Ameren established an ATM program under which Ameren may offer and sell from time to time up to $750 million of its common stock, which includes the ability to enter into forward sales agreements, subject to market conditions and other factors. For the sixnine months ended JuneSeptember 30, 2021, Ameren issued a total of 3.03.4 million shares of common stock and received aggregate proceeds of $234$261 million under the ATM program and the settlement of the remaining portion of the August 2019 forward sale agreement. Ameren plans to issue approximately $30$300 million of equity in the second half of 2021 and approximately $300 million each year from 2022 to 2025 in addition to issuances under the DRPlus and employee benefit plans. Ameren expects its equity to total capitalization ratio to be approximately 45% through December 31, 2025, with the long-term intent to support solid investment-grade credit ratings. See Long-term Debt and Equity below and Note 4 – Long-term Debt and Equity Financings under Part I, Item 1, of this report for additional information on the 2021 settlement of the remaining portion of the August 2019 forward sale agreement and the ATM program.program, including the September 2021 forward sale agreement.
The use of cash provided by operating activities and short-term borrowings to fund capital expenditures and other long-term investments at the Ameren Companies frequently results in a working capital deficit, defined as current liabilities exceeding current assets, as was the case at JuneSeptember 30, 2021, for Ameren. With the credit capacity available under the Credit Agreements, and cash and cash equivalents, Ameren (parent), Ameren Missouri, and Ameren Illinois, collectively, had net available liquidity of $2.0$1.8 billion at JuneSeptember 30, 2021. See Credit Facility Borrowings and Liquidity for additional information.
The following table presents net cash provided by (used in) operating, investing, and financing activities for the sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Net Cash Provided By
Operating Activities | | Net Cash Used In
Investing Activities | | Net Cash Provided By
Financing Activities | | Net Cash Provided By
Operating Activities | | Net Cash Used In
Investing Activities | | Net Cash Provided By
Financing Activities |
| | 2021 | | 2020 | | Variance | | 2021 | | 2020 | | Variance | | 2021 | | 2020 | | Variance | | 2021 | | 2020 | | Variance | | 2021 | | 2020 | | Variance | | 2021 | | 2020 | | Variance |
| Ameren | Ameren | $ | 436 | | | $ | 694 | | | $ | (258) | | | $ | (1,760) | | | $ | (1,315) | | | $ | (445) | | | $ | 1,290 | | | $ | 608 | | | $ | 682 | | Ameren | $ | 1,192 | | | $ | 1,329 | | | $ | (137) | | | $ | (2,646) | | | $ | (1,981) | | | $ | (665) | | | $ | 1,298 | | | $ | 644 | | | $ | 654 | |
| | Ameren Missouri | Ameren Missouri | 224 | | | 292 | | | (68) | | | (1,053) | | | (604) | | | (449) | | | 701 | | | 284 | | | 417 | | Ameren Missouri | 645 | | | 709 | | | (64) | | | (1,478) | | | (877) | | | (601) | | | 699 | | | 139 | | | 560 | |
| Ameren Illinois | Ameren Illinois | 286 | | | 340 | | | (54) | | | (668) | | | (659) | | | (9) | | | 477 | | | 336 | | | 141 | | Ameren Illinois | 507 | | | 515 | | | (8) | | | (1,074) | | | (1,030) | | | (44) | | | 542 | | | 537 | | | 5 | |
Cash Flows from Operating Activities
Our cash provided by operating activities is affected by fluctuations of trade accounts receivable, inventories, and accounts and wages payable, among other things, as well as the unique regulatory environment for each of our businesses. Substantially all expenditures related to fuel, purchased power, and natural gas purchased for resale are recovered from customers through rate adjustment mechanisms, which may be adjusted without a traditional rate proceeding. Similar regulatory mechanisms exist for certain other operating expenses that can also affect the timing of cash provided by operating activities. The timing of cash payments for costs recoverable under our regulatory mechanisms differs from the recovery period of those costs. Additionally, the seasonality of our electric and natural gas businesses, primarily caused by seasonal customer rates and changes in customer demand due to weather, such as increased demand resulting from the extremely cold weather in mid-February 2021, significantly affects the amount and timing of our cash provided by operating activities.
Ameren
Ameren’s cash provided by operating activities decreased $258$137 million in the first sixnine months of 2021, compared with the year-ago period. The following items contributed to the decrease:
•A $185$98 million decrease resulting from increased purchases for natural gas for resale and purchased power costs as a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather, which are recovered under the PGA, the FAC, and Ameren Illinois’ purchased power rider; a net decrease attributable to other regulatory recovery mechanisms; and a decrease related to a change in Ameren Missouri’s electric rate design. These items were partially offset by increased customer collections resulting from base rate increases pursuant to Ameren Illinois’ January 2021 natural gas rate order and due to Ameren Illinois’ electric transmission rate base growth, and state funding received by Ameren Illinois for customer billing assistance. These decreases were also partially offset by increased retail sales at Ameren Missouri and Ameren Illinois and the effect of customer disconnection activity at Ameren Illinois that resumed in April 2021, which had been suspended for most of 2020.
•A $25$44 million increase in interest payments,the cost of natural gas held in storage, primarily due to an increase in the average outstanding debt.at Ameren Illinois, because of higher prices.
•A $23$40 million decrease in net collateral activity with counterparties, primarily resulting from changes in the market prices of power, natural gas, and other fuels.
•A $21$39 million increase in interest payments, primarily due to an increase in the cost of natural gas held in storage at Ameren Illinois because of higher prices.average outstanding debt.
•A $16 million increase in major storm restoration costs at Ameren Illinois due to a January 2021 storm.
•A $13$28 million increase in payroll tax payments primarily due to the employer portion of Social Security taxes as a result of a payment deferral allowed in 2020 under the Coronavirus Aid, Relief, and Economic Security Act. Half of thisthe 2020 deferral will be paid at the end of 2021 and the remaining half will be paid at the end of 2022.
•A $10$15 million increase in property tax paymentsmajor storm restoration costs at Ameren MissouriIllinois, primarily due to higher assessed property tax values.a January 2021 storm.
The following items partially offset the decrease in Ameren’s cash from operating activities between periods:
•A $24$29 million increase, primarily resulting from reduced purchases of materials and supplies to support operations in 2021 as levels were increased in 2020 to mitigate against any potential supply disruptions associated with the COVID-19 pandemic.
•A $17$24 million decrease in pension and postretirement benefit plan contributions.
•A $20 million decrease in payments to settle ARO liabilities, primarily related to the closure of Ameren Missouri’s CCR storage facilities.
•A $16$20 million increase resulting from a decrease in coal inventory levels at Ameren Missouri, primarily due to weather-related delivery disruptions.disruptions and increased consumption levels.
•A $15 million increase resulting from a reduction in payments for certain cloud computing arrangements.
•A $9 million increase resulting from income tax refunds of $1 million in 2021, compared with income tax payments of $8 million in 2020, primarily from lower taxable income and the timing of payments in 2021.
Ameren Missouri
Ameren Missouri’s cash provided by operating activities decreased $68$64 million in the first sixnine months of 2021, compared with the year-ago period. The following items contributed to the decrease:
•A $74$72 million decrease resulting from increased purchases for natural gas for resale and purchased power costs as a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather, which are recovered under the PGA and the FAC; a net decrease attributable to other regulatory recovery mechanisms; and a decrease related to a change in electric rate design. These items were partially offset by increased retail sales.
•A $25$46 million decrease in net collateral activity with counterparties, primarily resulting from changes in the market prices of power, natural gas, and other fuels.
•A $10$17 million increase in interest payments, primarily due to an increase in the average outstanding debt.
•A $10 million increase in property tax payments primarily due to higher assessed property tax values.
•A $6$13 million increase in payroll tax payments primarily due to the employer portion of Social Security taxes as a result of a payment deferral allowed in 2020 under the Coronavirus Aid, Relief, and Economic Security Act. Half of thisthe 2020 deferral will be paid at the end of 2021 and the remaining half will be paid at the end of 2022.
The following items partially offset the decrease in Ameren Missouri’s cash from operating activities between periods:
•A $23 million increase in income tax refunds from Ameren (parent) pursuant to the tax allocation agreement, primarily due to the timing of payments and lower taxable income in 2021.
•A $17$20 million decrease in payments to settle ARO liabilities, primarily related to the closure of CCR storage facilities.
•A $16$20 million increase resulting from a decrease in coal inventory levels, primarily due to weather-related delivery disruptions.disruptions and increased consumption levels.
•A $14 million increase resulting from income tax refunds of $2 million in 2021, compared with income tax payments of $12 million in 2020, from Ameren (parent) pursuant to the tax allocation agreement, primarily from the timing of payments and lower taxable income in 2021.
•A $13 million increase, primarily resulting from reduced purchases of materials and supplies to support operations in 2021 as levels were increased in 2020 to mitigate against any potential supply disruptions associated with the COVID-19 pandemic.
•A $7 million decrease in pension and postretirement benefit plan contributions.
•A $7 million increase resulting from a reduction in payments for certain cloud computing arrangements.
Ameren Illinois
Ameren Illinois’ cash provided by operating activities decreased $54$8 million in the first sixnine months of 2021, compared with the year-ago period. The following items contributed to the decrease:
•A $118$41 million decrease resulting from increased purchases for natural gas for resale and purchased power costs as a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather, which are recovered under the PGA and a purchased power rider, and a net decrease attributable to other regulatory recovery mechanisms. These items were partially offset by increased customer collections resulting from base rate increases pursuant to the January 2021 natural gas rate order and due to electric transmission rate base growth, state funding received for customer billing assistance, increased retail sales, and the effect of customer disconnection activity that resumed in April 2021, which had been suspended for most of 2020.
•A $21$41 million increase in the cost of natural gas held in storage because of higher prices.
•A $16$15 million increase in major storm restoration costs, primarily due to a January 2021 storm.
•A $6 million increase in interest payments, primarily due to an increase in the average outstanding debt.
•A $4$9 million increase in payroll tax payments primarily due to the employer portion of Social Security taxes as a result of a payment deferral allowed in 2020 under the Coronavirus Aid, Relief, and Economic Security Act. Half of thisthe 2020 deferral will be paid at the end of 2021 and the remaining half will be paid at the end of 2022.
The following items partially offset the decrease in Ameren Illinois’ cash from operating activities between periods:
•A $98$48 million increase resulting from income tax refunds of $37$3 million in 2021, compared with income tax payments of $61$45 million in 2020, from Ameren (parent) pursuant to the tax allocation agreement, primarily due tofrom the timing of payments and lower taxable income in 2021.
•An $11A $16 million increase, primarily resulting from reduced purchases of materials and supplies to support operations in 2021 as levels were increased in 2020 to mitigate against any potential supply disruptions associated with the COVID-19 pandemic.
•A $14 million decrease in pension and postretirement benefit plan contributions.
•A $9 million increase resulting from a reduction in payments for certain cloud computing arrangements.
Cash Flows from Investing Activities
Ameren’s cash used in investing activities increased $445$665 million during the first sixnine months of 2021, compared with the year-ago period, primarily as a result of a $417$515 million increase in cash paid for the acquisition of wind generation assets at Ameren Missouri and a $118$214 million increase in capital expenditures, which were driven by an increase at Ameren Missouri, partially offset by a decrease at Ameren Illinois and a $26$41 million decrease at ATXI, primarily as a result of decreased Illinois Rivers transmission line expenditures as it was placed in service in December 2020. The increase in Ameren’s cash used in investing activities was partially offset by a $52$42 million decrease due to the timing of nuclear fuel expenditures and a $37$27 million decrease due to net investment activity in the nuclear decommissioning trust fund at Ameren Missouri.
Ameren Missouri’s cash used in investing activities increased $449$601 million during the first sixnine months of 2021, compared with the year-ago period, primarily as a result of a $417$515 million increase in cash paid for the acquisition of wind generation assets and a $168$274 million increase in capital expenditures, primarilylargely related to electric delivery infrastructure upgrades, electric distribution system reliability projects, and generator repairs at the Callaway Energy Center. The increase in Ameren Missouri’s cash used in investing activities was partially offset by a $47$120 million return of net money pool advances, a $52$42 million decrease due to the timing of nuclear fuel expenditures, and a $37$27 million decrease due to net investment activity in the nuclear decommissioning trust fund.
Ameren Illinois’ cash used in investing activities increased $9$44 million during the first sixnine months of 2021, compared with the year-ago period, primarily as a result of a $20$41 million increase in Ameren Illinois’ net money pool advances, partially offset by a $15$5 million decrease in capital expenditures, primarilylargely related to natural gas infrastructure and electric transmission system reliability projects.projects and natural gas infrastructure.
Cash Flows from Financing Activities
Cash provided by, or used in, financing activities is a result of our financing needs, which depend on the level of cash provided by operating activities, the level of cash used in investing activities, the level of dividends, and our long-term debt maturities, among other things.
Due to extremely cold winter weather in mid-February 2021, Ameren Missouri and Ameren Illinois experienced higher than anticipated commodity costs for purchased power and natural gas purchased for resale and purchased power, which contributed to the acceleration of the timing of certain planned 2021 debt issuances.
Ameren’s cash provided by consolidated financing activities increased $682$654 million during the first sixnine months of 2021, compared with the year-ago period. During the first sixnine months of 2021, Ameren utilized proceeds from the issuance of $1,423 million of long-term debt for general corporate purposes, including to repay then-outstanding short-term debt, including short-term debt incurred in connection with the increased purchases for natural gas for resale and purchased power costs as a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather,discussed above, and to fund, in part, investing activities. During the first sixnine months of 2021, Ameren repaidreceived $63 million from net short-term debt of $59 million.commercial paper issuances. In addition, Ameren received aggregate cash proceeds of $258$297 million from the issuance of common stock under the ATM program, the DRPlus, and the 401(k) plan and the settlement of the remaining portion of the August 2019 forward sale agreement. These proceeds were used to fund a portion of Ameren Missouri’s wind generation investments and to fund, in part, other investing activities. In comparison, during the first sixnine months of 2020, Ameren utilized proceeds from the issuance of $1,263 million of long-term debt for general corporate purposes, including to repay then-outstanding short-term debt, including short-term debt incurred in connection with the repayment at maturity of long-term debt of $85 million and to fund, in part, investing activities. During the first sixnine months of 2020, Ameren repaid net short-term debt of $320$168 million. In addition, Ameren received aggregate cash proceeds of $37 million from the issuance of common stock under the DRPlus and the 401(k) plan. During the first sixnine months of 2021, Ameren paid common stock dividends of $282$423 million, compared with $244$367 million in the year-ago period, as a result of an increase in both the dividend rate and the number of common shares outstanding.
Ameren Missouri’s cash provided by financing activities increased $417$560 million during the first sixnine months of 2021, compared with the year-ago period. During the first sixnine months of 2021, Ameren Missouri utilized net proceeds from the issuance of long-term debt of $524 million to repay then-outstanding short-term debt, including short-term debt incurred in connection with the increased purchases for natural gas for resale and purchased power costs as a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather.discussed above. Additionally, proceeds from the issuance of long-term debt and capital contributions of $183 million from Ameren (parent) were used to fund, in part, investing activities. In comparison, during the first sixnine months of 2020, Ameren Missouri utilized net proceeds from the issuance of $465 million of long-term debt to repay then-outstanding short-term debt, including short-term debt incurred in connection with the repayment at maturity of long-term debt of $85 million. During the first sixnine months of 2020, Ameren Missouri repaid net short-term debt of $155$234 million borrowed $65 million from the money pool, and used cash provided by financing activities to fund, in part, investing activities.
Ameren Illinois’ cash provided by financing activities increased $141$5 million during the first sixnine months of 2021, compared with the year-ago period. During the first sixnine months of 2021, Ameren Illinois utilized net proceeds from the issuance of long-term debt of $449 million to repay then-outstanding short-term debt, including short-term debt incurred in connection with the increased purchases for natural gas for resale and purchased power costs as a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather,discussed above, and to fund, in part, investing activities. In the first sixnine months of 2021, Ameren Illinois received capital contributions of $70$145 million from Ameren (parent), compared with $350 million in the year-ago period. In addition, Ameren Illinois repaid $19 million of money pool borrowings and redeemed $13 million of preferred stock in the current year period. During the first six
nine months of 2020, Ameren Illinois repaidutilized net short-term debtproceeds from commercial paper issuance of $12 million.$189 million to fund, in part, investing activities.
See Long-term Debt and Equity in this section for additional information on maturities and issuances of long-term debt, issuances of common stock, and redemptions of preferred stock.
Credit Facility Borrowings and Liquidity
The following table presents Ameren’s consolidated liquidity as of JuneSeptember 30, 2021:
| | | | | | | | | |
| | | | | Available at JuneSeptember 30, 2021 |
Ameren (parent) and Ameren Missouri: | | | | | |
Missouri Credit Agreement – borrowing capacity | | | | | $ | 1,200 | |
| | | | | |
| Less: Ameren (parent) commercial paper outstanding | | | | | 277356 | |
| | | | | |
| | | | | |
| Less: Ameren Missouri letters of credit | | | | | 23 | |
| Missouri Credit Agreement – subtotal | | | | | 921841 | |
| Ameren (parent) and Ameren Illinois: | | | | | |
Illinois Credit Agreement – borrowing capacity | | | | | 1,100 | |
| | | | | |
| Less: Ameren (parent) commercial paper outstanding | | | | | 154197 | |
| | | | | |
| | | | | |
| Less: Ameren Illinois letters of credit | | | | | 1 | |
Illinois Credit Agreement – subtotal | | | | | 945902 | |
| Subtotal | | | | | $ | 1,8661,743 | |
| Add: Cash and cash equivalents | | | | | 997 | |
| Net Available Liquidity | | | | | $ | 1,9651,750 | |
The Credit Agreements, among other things, provide $2.3 billion of credit until maturity in December 2024. See Note 3 – Short-term Debt and Liquidity under Part I, Item 1, of this report for additional information on the Credit Agreements. During the sixnine months ended JuneSeptember 30, 2021, Ameren (parent), Ameren Missouri, and Ameren Illinois each issued commercial paper. Borrowings under the Credit Agreements and commercial paper issuances are based upon available interest rates at that time of the borrowing or issuance.
Ameren has a money pool agreement with and among its utility subsidiaries to coordinate and to provide for certain short-term cash and working capital requirements. As short-term capital needs arise, and based on availability of funding sources, Ameren Missouri and Ameren Illinois will access funds from the utility money pool, the Credit Agreements, or the commercial paper programs depending on which option has the lowest interest rates.
See Note 3 – Short-term Debt and Liquidity under Part I, Item 1, of this report for additional information on credit agreements, commercial paper issuances, Ameren’s money pool arrangements and related borrowings, and relevant interest rates.
The issuance of short-term debt securities by Ameren’s utility subsidiaries is subject to FERC approval under the Federal Power Act. In 2020, the FERC issued orders authorizing Ameren Missouri and Ameren Illinois to each issue up to $1 billion of short-term debt securities through March 2022 and September 2022, respectively. In July 2021, the FERC issued an order authorizing ATXI to issue up to $300 million of short-term debt securities, which expires in July 2023.
The Ameren Companies continually evaluate the adequacy and appropriateness of their liquidity arrangements for changing business conditions. When business conditions warrant, changes may be made to existing credit agreements or to other borrowing arrangements, or other arrangements may be made.
Long-term Debt and Equity
The following table presents Ameren’s issuances (net of any issuance premiums or discounts) of long-term debt and equity, as well as maturities of long-term debt and redemptions of preferred stock for the sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Month Issued, Redeemed, or Matured | | 2021 | | 2020 | | | Month Issued, Redeemed, or Matured | | 2021 | | 2020 | |
| Issuances of Long-term Debt | Issuances of Long-term Debt | | Issuances of Long-term Debt | |
| Ameren: | Ameren: | | Ameren: | |
| 1.75% Senior unsecured notes due 2028 | 1.75% Senior unsecured notes due 2028 | March | | $ | 450 | | | $ | — | | | 1.75% Senior unsecured notes due 2028 | March | | $ | 450 | | | $ | — | | |
| 3.50% Senior unsecured notes due 2031 | 3.50% Senior unsecured notes due 2031 | April | | — | | | 798 | | | 3.50% Senior unsecured notes due 2031 | April | | — | | | 798 | | |
| Ameren Missouri: | Ameren Missouri: | | Ameren Missouri: | |
| 2.95% First mortgage bonds due 2030 | 2.95% First mortgage bonds due 2030 | March | | — | | | 465 | | | 2.95% First mortgage bonds due 2030 | March | | — | | | 465 | | |
| 2.15% First mortgage bonds due 2032 (green bonds) | 2.15% First mortgage bonds due 2032 (green bonds) | June | | 524 | | | — | | | 2.15% First mortgage bonds due 2032 (green bonds) | June | | 524 | | | — | | |
| Ameren Illinois: | Ameren Illinois: | | Ameren Illinois: | |
| 2.90% First mortgage bonds due 2051 (green bonds) | 2.90% First mortgage bonds due 2051 (green bonds) | June | | 349 | | | 2.90% First mortgage bonds due 2051 (green bonds) | June | | 349 | | |
| 0.375% First mortgage bonds due 2023 | 0.375% First mortgage bonds due 2023 | June | | 100 | | | — | | | 0.375% First mortgage bonds due 2023 | June | | 100 | | | — | | |
| Total Ameren long-term debt issuances | Total Ameren long-term debt issuances | | $ | 1,423 | | | $ | 1,263 | | | Total Ameren long-term debt issuances | | $ | 1,423 | | | $ | 1,263 | | |
| Issuances of Common Stock | Issuances of Common Stock | | Issuances of Common Stock | |
| Ameren: | Ameren: | | Ameren: | |
DRPlus and 401(k) (a) | DRPlus and 401(k) (a) | Various | | $ | 24 | | | $ | 27 | | | DRPlus and 401(k) (a) | Various | | $ | 36 | | | $ | 37 | | |
Forward sale agreement (b) | February | | 113 | | | — | | | |
August 2019 forward sale agreement (b) | | August 2019 forward sale agreement (b) | February | | 113 | | | — | | |
ATM program (c) | ATM program (c) | Various | | 121 | | | — | | | ATM program (c) | Various | | 148 | | | — | | |
Total Ameren common stock issuances (d) | Total Ameren common stock issuances (d) | | $ | 258 | | | $ | 27 | | | Total Ameren common stock issuances (d) | | $ | 297 | | | $ | 37 | | |
| | Maturities of Long-term Debt | Maturities of Long-term Debt | | Maturities of Long-term Debt | |
| Ameren Missouri: | Ameren Missouri: | | Ameren Missouri: | |
| 5.00% Senior secured notes due 2020 | 5.00% Senior secured notes due 2020 | February | | $ | — | | | $ | 85 | | | 5.00% Senior secured notes due 2020 | February | | $ | — | | | $ | 85 | | |
| | Total Ameren long-term debt maturities | Total Ameren long-term debt maturities | | $ | — | | | $ | 85 | | | Total Ameren long-term debt maturities | | $ | — | | | $ | 85 | | |
| Redemptions of Preferred Stock | Redemptions of Preferred Stock | | Redemptions of Preferred Stock | |
| Ameren Illinois: | Ameren Illinois: | | Ameren Illinois: | |
| 6.625% Series | 6.625% Series | March | | $ | 12 | | | $ | — | | | 6.625% Series | March | | $ | 12 | | | $ | — | | |
| 7.75% Series | 7.75% Series | March | | 1 | | | — | | | 7.75% Series | March | | 1 | | | — | | |
| Total Ameren Illinois preferred stock redemptions | Total Ameren Illinois preferred stock redemptions | | $ | 13 | | | $ | — | | | Total Ameren Illinois preferred stock redemptions | | $ | 13 | | | $ | — | | |
|
(a)Ameren issued a total of 0.30.4 million and 0.40.5 million shares of common stock under its DRPlus and 401(k) plan in the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively.
(b)Ameren issued 1.6 million shares of common stock to settle the remainder of the August 2019 forward sale agreement.
(c)Ameren issued 1.41.8 million shares of common stock under the ATM program.
(d)Excludes 0.5 million and 0.5 million shares of common stock valued at $33 million and $38 million issued for no cash consideration in connection with stock-based compensation for the sixnine months ended JuneSeptember 30, 2021 and 2020, respectively.
See Note 4 – Long-term Debt and Equity Financings under Part I, Item 1, of this report for additional information, including proceeds from issuances of long-term debt, the use of those proceeds, Ameren’s forward equity sale agreement, and the ATM program, as well as information on capital contributions received by Ameren Missouri and Ameren Illinois from Ameren (parent).
Indebtedness Provisions and Other Covenants
At JuneSeptember 30, 2021, the Ameren Companies were in compliance with the provisions and covenants contained in their credit agreements, indentures, and articles of incorporation, as applicable, and ATXI was in compliance with the provisions and covenants contained in its note purchase agreement. See Note 3 – Short-term Debt and Liquidity under Part I, Item 1, of this report and Note 4 – Short-term Debt and Liquidity and Note 5 – Long-term Debt and Equity Financings under Part II, Item 8, of the Form 10-K for a discussion of provisions, applicable cross-default provisions, and covenants contained in our credit agreements, in ATXI’s note purchase agreement, and in certain of the Ameren Companies’ indentures and articles of incorporation.
We consider access to short-term and long-term capital markets to be a significant source of funding for capital requirements not satisfied by cash provided by our operating activities. Inability to raise capital on reasonable terms, particularly during times of uncertainty in the capital markets, could negatively affect our ability to maintain and expand our businesses. After assessing its current operating performance, liquidity, and credit ratings (see Credit Ratings below), Ameren, Ameren Missouri, and Ameren Illinois each believes that it will continue to have access to the capital markets on reasonable terms. However, events beyond Ameren’s, Ameren Missouri’s, and Ameren Illinois’ control may create uncertainty in the capital markets or make access to the capital markets uncertain or limited. Such events could increase our cost of capital and adversely affect our ability to access the capital markets.
Dividends
The amount and timing of dividends payable on Ameren’s common stock are within the sole discretion of Ameren’s board of directors. Ameren’s board of directors has not set specific targets or payout parameters when declaring common stock dividends, but it considers various factors, including Ameren’s overall payout ratio, payout ratios of our peers, projected cash flow and potential future cash flow requirements, historical earnings and cash flow, projected earnings, impacts of regulatory orders or legislation, and other key business considerations. Ameren expects its dividend payout ratio to be between 55% and 70% of annual earnings over the next few years.
See Note 4 – Short-term Debt and Liquidity and Note 5 – Long-term Debt and Equity Financings under Part II, Item 8, of the Form 10-K for additional discussion of covenants and provisions contained in certain of the Ameren Companies’ financial agreements and articles of incorporation that would restrict the Ameren Companies’ payment of dividends in certain circumstances. At JuneSeptember 30, 2021, none of these circumstances existed at Ameren, Ameren Missouri, or Ameren Illinois and, as a result, these companies were not restricted from paying dividends.
The following table presents common stock dividends declared and paid by Ameren Corporation to its common shareholders and by Ameren subsidiaries to their parent, Ameren Corporation, for the sixnine months ended JuneSeptember 30, 2021 and 2020:
| | | Six Months | | Nine Months |
| | 2021 | | 2020 | | 2021 | | 2020 |
| Ameren | Ameren | $ | 282 | | | $ | 244 | | Ameren | $ | 423 | | | $ | 367 | |
| | ATXI | ATXI | 32 | | | — | | ATXI | 82 | | | — | |
Commitments
As of JuneSeptember 30, 2021, there have been no material changes other than in the ordinary course of business related to cash requirements arising from contractual obligations provided in Item 7 of the Form 10-K for the year ended December 31, 2020. See Long-term Debt and Equity section above for Ameren (parent), Ameren Missouri, and Ameren Illinois for debt issuances during the period ended JuneSeptember 30, 2021.
Off-balance-sheet Arrangements
At JuneSeptember 30, 2021, none of the Ameren Companies had any significant off-balance-sheet financing arrangements, other than variable interest entities.entities and the September 2021 forward sale agreement relating to common stock. See Note 1 – Summary of Significant Accounting Policies under Part I, Item 1, of this report for further detail concerning variable interest entities.
Credit Ratings
Our credit ratings affect our liquidity, our access to the capital markets and credit markets, our cost of borrowing under our credit facilities and our commercial paper programs, and our collateral posting requirements under commodity contracts.
The following table presents the principal credit ratings by Moody’s and S&P, as applicable, effective on the date of this report:
| | | | | | | | | | | | | | |
| | Moody’s | | S&P |
| Ameren: | | | | |
| Issuer/corporate credit rating | | Baa1 | | BBB+ |
| Senior unsecured debt | | Baa1 | | BBB |
| Commercial paper | | P-2 | | A-2 |
| Ameren Missouri: | | | | |
| Issuer/corporate credit rating | | Baa1 | | BBB+ |
| Secured debt | | A2 | | A |
| Senior unsecured debt | | Baa1 | | Not Rated |
| Commercial paper | | P-2 | | A-2 |
| Ameren Illinois: | | | | |
| Issuer/corporate credit rating | | A3 | | BBB+ |
| Secured debt | | A1 | | A |
| Senior unsecured debt | | A3 | | BBB+ |
| Commercial paper | | P-2 | | A-2 |
| ATXI: | | | | |
| Issuer credit rating | | A2 | | Not Rated |
| Senior unsecured debt | | A2 | | Not Rated |
A credit rating is not a recommendation to buy, sell, or hold securities. It should be evaluated independently of any other rating. Ratings are subject to revision or withdrawal at any time by the rating organization.
Collateral Postings
Any weakening of our credit ratings may reduce access to capital and trigger additional collateral postings and prepayments. Such changes may also increase the cost of borrowing, resulting in an adverse effect on earnings. Cash collateral postings and prepayments made with external parties, including postings related to exchange-traded contracts, were $41 $71 million for Ameren and Ameren Missouri and cash collateral posted by external parties were $24 $28 million, $1 million, and $27 million for Ameren, Ameren Missouri, and Ameren Illinois at JuneSeptember 30, 2021. A sub-investment-grade issuer or senior unsecured debt rating (below “Baa3” from Moody’s or below “BBB-” from S&P) at JuneSeptember 30, 2021, could have resulted in Ameren, Ameren Missouri, or Ameren Illinois being required to post additional collateral or other assurances for certain trade obligations amounting to $139$129 million, $116$93 million, and $23$36 million, respectively.
Changes in commodity prices could trigger additional collateral postings and prepayments. Based on credit ratings at JuneSeptember 30, 2021, if market prices were 15% higher or lower than JuneSeptember 30, 2021 levels in the next 12 months and 20% higher or lower thereafter through the end of the term of the commodity contracts, then Ameren and Ameren Missouri or Ameren Illinois could be required to post an immaterial amount, compared to each company’s liquidity, ofadditional collateral or other assurances for certain trade obligations.obligations up to $36 million.
OUTLOOK
Below are some key trends, events, and uncertainties that may reasonably affect our results of operations, financial condition, or liquidity, as well as our ability to achieve strategic and financial objectives, for 2021 and beyond. The continued effect of the COVID-19 pandemic on our results of operations, financial position, and liquidity in subsequent periods will depend on its severity and longevity, future regulatory or legislative actions with respect thereto, and the resulting impact on business, economic, and capital market conditions. We continue to assess the impacts the COVID-19 pandemic is having on our businesses, including but not limited to impacts on our liquidity; demand for residential, commercial, and industrial electric and natural gas services; changes in deferred payment arrangements for customers; the timing and extent to which recovery of incremental costs incurred, net of savings, and forgone customer late fee revenues at Ameren Missouri is allowed by the MoPSC; changes in our ability to disconnect customers for nonpayment; bad debt expense; supply chain operations; the availability of our employees and contractors; counterparty credit; capital construction; infrastructure operations and maintenance; energy-efficiency programs; and pension valuations. For additional information regarding recent rate orders, lawsuits, and pending requests filed with state and federal regulatory commissions, including those discussed below, see Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report and Note 2 – Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K.
Operations
•In the first halfnine months of 2021, our sales volumes, which have been, and continue to be, affected by the COVID-19 pandemic, among other things, increased compared to the same period in 2020, excluding the estimated effects of weather and customer energy-efficiency programs. We continue to expect a gradual improvement in sales volumes in 2021, compared to 2020. Our customers’ payment for services has been adversely affected by the COVID-19 pandemic, which has caused our accounts receivable balances that are past due
or that are a part of a deferred payment arrangement to be higher than normal historical levels. Because of their regulatory frameworks, Ameren Illinois’ and ATXI’s revenues are largely decoupled from changes in sales volumes. See the Results of Operations section above for additional information on our accounts receivable balances, Ameren Illinois’ electric and natural gas bad debt riders, and changes in Ameren Missouri’s sales volumes in the secondthird quarter and first halfnine months of 2021, compared to the same periods in 2020. Additionally, see Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report and Note 2 – Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K for information on Ameren Missouri’s and Ameren Illinois’ reinstatement of customer disconnection and late fee charges for non-payment, accounting authority orders issued by the MoPSC related to Ameren Missouri's electric and natural gas services to allow Ameren Missouri to accumulate certain costs incurred, net of savings, and forgone customer late fee revenues related to the COVID-19 pandemic for consideration of recovery in the current electric and natural gas service regulatory rate reviews, and orders issued by the ICC in a service disconnection moratorium proceeding, which required Ameren Illinois to implement more flexible credit and collection practices and allowed for recovery of costs incurred related to the COVID-19 pandemic and forgone late fees.
•In September 2021, President Biden issued an executive order directing that federal agencies require employers with United States government contracts to ensure that their United States-based employees, contractors, and subcontractors, at on-site and remote locations, are fully vaccinated for COVID-19. It permits exceptions for valid medical and religious reasons. The executive order does not provide an exception for regular COVID-19 testing as an alternative to vaccination. Without further change, the expected deadline for compliance is January 4, 2022. As a United States government contractor, the Ameren Companies will be required to comply with the executive order’s vaccine mandate. The timing of implementation of the executive order may be affected by additional guidance issued, including any extensions of time granted to comply. Compliance with the executive order or any future vaccine mandates may result in labor shortages, including shortages in skilled professional and technical labor, supply chain disruptions, delays in contractors’ performance or completion of work, and/or increased costs for us, our contractors, or our suppliers, which may have a material adverse effect on our results of operations, financial position, and liquidity.
•The PISA permits Ameren Missouri to defer and recover 85% of the depreciation expense and earn a return at the applicable WACC on investments in certain property, plant, and equipment placed in service, and not included in base rates. The regulatory asset for accumulated PISA deferrals also earns a return at the applicable WACC, with all approved PISA deferrals added to rate base prospectively and recovered over a period of 20 years following a regulatory rate review. Additionally, under the RESRAM, Ameren Missouri is permitted to recover the 15% of depreciation expense not recovered under the PISA, and earn a return at the applicable WACC for investments in renewable generation plant placed in service to comply with Missouri’s renewable energy standard. Accumulated RESRAM deferrals earn carrying costs at short-term interest rates. The PISA and the RESRAM mitigate the effects of regulatory lag between regulatory rate reviews. Those investments not eligible for recovery under the PISA and the remaining 15% of
certain property, plant, and equipment placed in service, unless eligible for recovery under the RESRAM, remain subject to regulatory lag. Ameren Missouri recognizes the cost of debt on PISA deferrals as an offset to interest charges, instead of using the applicable WACC, with the difference recognized in revenues when recovery of such deferrals is reflected in customer rates. As a result of the PISA election, additional provisions of the law apply to Ameren Missouri, including limitations on electric customer rate increases. Ameren Missouri does not expect to exceed these rate increase limitations in 2021. Both the rate increase limitation and the PISA are effective through December 2023, unless Ameren Missouri requests and the MoPSC approves an extension through December 2028.
•In 2018, the MoPSC issued an order approving Ameren Missouri’s MEEIA 2019 plan. The plan includes a portfolio of customer energy-efficiency programs through December 2022 and low-income customer energy-efficiency programs through December 2024, along with a rider. Ameren Missouri intends to invest $290approximately $360 million over the life of the plan, including $90 million in 2021, and $70 million in 2022.2022, and $75 million in 2023. The plan includes the continued use of the MEEIA rider, which allows Ameren Missouri to collect from, or refund to, customers any difference in actual MEEIA program costs and related lost electric margins and the amounts collected from customers. In addition, the plan includes a performance incentive that provides Ameren Missouri an opportunity to earn additional revenues by achieving certain customer energy-efficiency goals. If the target goals were achieved for 2020, additional revenues of $10 million would be recognized in 2021, and, if target goals are achieved for 2021 and 2022, additional revenues of $24 million would be recognized in 2022.2022, and if target goals are achieved for 2023, additional revenues of $13 million would be recognized in 2023. Ameren Missouri’s ability to achieve targeted goals could be affected by the COVID-19 pandemic. For the year ended December 31, 2020, Ameren Missouri recognized $9 million and $6 million in revenues related to MEEIA performance incentives.incentives in 2021 and 2020, respectively.
•In March 2021, Ameren Missouri filed a request with the MoPSC seeking approval to increase its annual revenues for electric service by $299 million. The MoPSC proceeding relating to the proposed electric service rate changes will take place over a period of up to 11 months, with aA decision by the MoPSC is expected by Februarymid-February 2022, andwith new rates effective by late February 2022. Ameren Missouri cannot predict the level of any electric service rate change the MoPSC may approve, or whether any rate change that may eventually be approved will be sufficient for Ameren Missouri to recover its costs and earn a reasonable return on its investments when the rate change goes into effect.
•In March 2020, the MoPSC issued an order in Ameren Missouri’s July 2019 electric service regulatory rate review, resulting in a decrease of $32 million to Ameren Missouri’s annual revenue requirement for electric retail service. The order also approved a change in rate design, which resulted in lower winter rates applied to May sales volumes and will result in higher summer rates applied to September sales volumes beginning in 2021. Previously, blended rates were applied to both months’ sales volumes. The year-over-year decrease to second quarter 2021 earnings, compared to the same period in 2020, from the effect of the change in rate design is estimated at approximately $45 million and is expected to largely reverse in the third quarter.
•Ameren Illinois and ATXI use a forward-looking rate calculation with an annual revenue requirement reconciliation for each company’s electric transmission business. Based on expected rate base growth and the currently allowed 10.52% ROE, which includes a 50 basis point incentive adder for participation in an RTO, the revenue requirements included in 20212022 rates for Ameren Illinois’ and ATXI’s electric
transmission businesses are $380$422 million and $200$195 million, respectively. These revenue requirements represent an increase in Ameren Illinois’ revenue requirement of $42 million and a decrease in ATXI’s revenue requirementsrequirement of $67$5 million and $8 million, respectively, from the revenue requirements reflected in 20202021 rates, primarily due to a higher expected rate base growth.at Ameren Illinois and a lower expected rate base at ATXI. These rates will affect Ameren Illinois’ and ATXI’s cash receipts during 2021,2022, but will not determine their respective electric transmission service operating revenues, which will instead be based on 20212022 actual recoverable costs, rate base, and a return on rate base at the applicable WACC as calculated under the FERC formula ratemaking framework.
•The allowed base ROE for FERC-regulated transmission rates previously charged under the MISO tariff is the subject of an appeal filed with the United States Court of Appeals for the District of Columbia Circuit. Depending on the outcome of the appeal, the transmission rates charged during previous periods and the currently effective rates may be subject to change. Additionally, in March 2019, the FERC issued a Notice of Inquiry regarding its transmission incentives policy. In March 2020, the FERC issued a Notice of Proposed Rulemaking on its transmission incentives policy, which addressed many of the issues in the Notice of Inquiry on transmission incentives. The Notice of Proposed Rulemaking included an increased incentive in the allowed base ROE for participation in an RTO to 100 basis points from the current 50 basis points and revised the parameters for awarding incentives, while limiting the overall incentives to a cap of 250 basis points, among other things. In April 2021, the FERC issued a Supplemental Notice of Proposed Rulemaking, which proposes to modify the Notice of Proposed Rulemaking’s incentive for participation in an RTO by limiting this incentive for utilities that join an RTO to 50 basis points and only allowing them to earn the incentive for three years, among other things. If this proposal is included in a final rule, Ameren Illinois and ATXI would no longer be eligible for the 50 basis point RTO incentive adder, prospectively. The FERC is under no deadline to issue a final rule on this matter. Ameren is unable to predict the ultimate impact of any changes to the FERC’s incentives policy, or any further order on base ROE. A 50 basis point change in the FERC-allowed base ROE would affect Ameren’s and Ameren Illinois’ annual net income by an estimated $11 million and $7 million, respectively, based on each company’s 2021 projected rate base.
•Ameren Illinois’ electric distribution service performance-based formula ratemaking framework allows Ameren Illinois to reconcile electric distribution service rates to its actual revenue requirement on an annual basis to reflect actual recoverable costs incurred and a return at
the applicable WACC on year-end rate base. If a given year’s revenue requirement varies from the amount collected from customers, an adjustment is made to electric operating revenues with an offset to a regulatory asset or liability to reflect that year’s actual revenue requirement, independent of actual sales volumes. The regulatory balance is then collected from, or refunded to, customers within two years from the end of the year. By law,Pursuant to an order issued by the ICC in March 2021, Ameren Illinois may opt inexpects to use the existingcurrent IEIMA formula framework to establish annual customer rates effective through 2023. Pursuant to a March 2021 ICC order, once Ameren Illinois ceases to update customer rates under performance-based formula ratemaking, Ameren Illinois would be allowed to2023, and reconcile itsthe related revenue requirement for up to two annual periods in which customer rates had been established but not yet reconciled, under the performance-based formula ratemaking framework. To utilize the reconciliation, Ameren Illinois is required to file a request to update its electric distribution service rates through a traditional regulatory rate review, which may be based on a future test yearfor 2022 and would reflect a proposed ROE subject to ICC approval. That request would need to be filed by the end of March in the year following the last year in which Ameren Illinois opted to set annual rates via the performance-based formula ratemaking framework. Ameren Illinois would be required to file that request no later than March 2023. Pursuant to the order, and without legislative change or Ameren Illinois’ election to opt out of performance-based formula ratemaking,As such, Ameren Illinois’ 2022 and 2023 revenues would reflect each year’s actual recoverable costs, year-end rate base, and a return at the applicable WACC, with the ROE component based on the annual average of the monthly yields of the 30-year United States Treasury bonds plus 580 basis points. The revenue requirement reconciliation adjustment would be collected from, or refunded to, customers within two years fromFor more information on the endMarch 2021 ICC order, see Note 2 – Rate and Regulatory Matters under Part I, Item 1, of the reconciled year.this report. By law, the decoupling provisions extend beyond the end of existing performance-based formula ratemaking, which ensures that Ameren Illinois’ electric distribution revenues authorized in a regulatory rate review are not affected by changes in sales volumes.
•Pursuant to the CEJA, which was enacted in September 2021, Ameren Illinois may file an MYRP with the ICC to establish base rates for electric distribution service to be charged to customers for each calendar year of a four-year period. An MYRP would allow Ameren Illinois to reconcile electric distribution service rates to its actual revenue requirement on an annual basis, subject to a reconciliation cap and adjustments to the approved ROE for performance incentives and penalties. Electric distribution service revenues would continue to be decoupled from sales volumes under an MYRP. Subject to stakeholder workshops regarding the MYRP ratemaking process, including establishing performance metrics, Ameren Illinois anticipates filing an MYRP by mid-January 2023, with rates effective beginning in 2024. If Ameren Illinois does not file an MYRP for rates effective beginning in 2024, its next opportunity to file an MYRP would be for rates effective beginning in 2028. Additionally, the CEJA established emission standards that will limit the operations of Ameren Missouri's five natural gas-fired energy centers located in the state of Illinois, including the possibility of one or more energy center closures earlier than anticipated. These energy centers are utilized to support peak loads. The emission limitations will become effective between 2030 and 2040. Ameren Missouri is actively pursuing improvementsreviewing the emission standards and the resulting effect they may have on its generation strategy, including any increases in capital expenditures or operating costs, or limits to ratemaking applicable to rates established after the performance-based formula ratemaking is no longer utilized.useful lives of the five natural gas-fired energy centers.
•In 2020, the ICC issued an order in Ameren Illinois’ annual update filing that approved a $49 million decrease in Ameren Illinois’ electric distribution service rates beginning in January 2021. Ameren Illinois’ 2021 electric distribution service revenues will be based on its 2021 actual recoverable costs, 2021 year-end rate base, and a return at the applicable WACC, with the ROE component based on the annual average of the monthly yields of the 30-year United States Treasury bonds plus 580 basis points. As of JuneSeptember 30, 2021, Ameren Illinois expects its 2021 electric distribution year-end rate base to be $3.7 billion. With or without extension of the formula ratemaking framework, theThe 2021 revenue requirement reconciliation adjustment will be collected from, or refunded to, customers in 2023. A 50 basis point change in the annual average of the monthly yields of the 30-year United States Treasury bonds would result in an estimated $10 million change in Ameren’s and Ameren Illinois’ annual net income, based on Ameren Illinois’ 2021 projected year-end rate base, including electric energy-efficiency investments.
Ameren Illinois’ allowed ROE for the first halfnine months of 2021 was based on an estimated annual average of the monthly yields of the 30-year United States Treasury bonds of 2.31%2.12%.
•In JulyAugust 2021, Ameren Illinois filed a revised request seeking to increase its annual revenues for electric distribution service by $60$59 million. An ICC decision in this proceeding is expectedrequired by December 2021, with new rates effective in January 2022. These rates will affect Ameren Illinois' cash receipts during 2022, but will not affect electric distribution service revenues, which will be based on 2022 actual recoverable costs, 2022 year-end rate base, and a return at the applicable WACC as calculated under the Illinois performance-based formula ratemaking framework.
•In January 2021, the ICC issued an order in Ameren Illinois’ February 2020 natural gas delivery service regulatory rate review, which resulted in an increase to its annual revenues for natural gas delivery service of $76 million. The new rates became effective in January 2021. As a result of this order, the rate base under the QIP was reset to zero. Ameren Illinois used a 2021 future test year in this proceeding. The order also approved the implementation of a change in rate design, which concentrates more revenues in the winter heating season due to an increase in volumetric rates and a decrease in fixed customer rates. As such, the change in rate design will have an impact on interim period 2021 earnings, compared to 2020, but is not expected to materially affect annual earnings comparisons. The quarterly year-over-year increases/(decreases) to 2021 earnings, compared to the same periods in 2020, from the combined effect of the rate increase and the change in rate design are estimated at $17 million, $(7) million, and $7 million for the first quarter, third quarter, and fourth quarter comparisons, respectively.
•Pursuant to Illinois law, Ameren Illinois’ electric energy-efficiency investments are deferred as a regulatory asset and earn a return at the applicable WACC, with the ROE component based on the annual average of the monthly yields of the 30-year United States Treasury bonds plus 580 basis points. The allowed ROE on electric energy-efficiency investments can be increased or decreased by up to 200 basis points, depending on the achievement of annual energy savings goals. Ameren Illinois plans to invest up to approximately $100 million per year in electric energy-efficiency programs through 2025. While the ICC has approved a plan consistent with this spending level through 2021,2025, the ICC has the ability to reduce the amount of electric energy-efficiency savings goals in future plan program years if there are insufficient cost-effective programs available, which could reduce the investments in electric energy-efficiency programs. The electric energy-efficiency program investments and the return on those investments are collected from customers through a rider and are not recovered through the electric distribution service performance-based formula ratemaking framework. In July 2021,Pursuant to the ICC issued an order approving Ameren Illinois’ energy-efficiency plan that includesCEJA, the annual investments in electric energy-efficiency programs upmay increase by approximately $10 million to approximately $100$40 million per year fromwith the increase depending on the election of certain customers to participate in the programs. Those customers have until late January 2022 through 2025.to decide if they will participate in the four-year programs.
•During its return to full power after the completion of the last refueling and maintenance outage in late December 2020, the Callaway Energy Center experienced a non-nuclear operating issue related to its generator. After replacement of certain key components of the generator, the energy center returned to service on August 4, 2021. The cost of generator repairs was approximately $60 million, which was largely capital expenditures. In April 2021, Ameren Missouri’s insurance claims were accepted by NEIL, which are expected to cover a significant portion of the capital expenditures and covered lost sales of up to $4.5 million weekly after March 17, 2021. Insurance recoveries related to lost sales were included in net energy costs under the FAC. Pursuant to a MoPSC February 2020 order, Ameren Missouri deferred, as a regulatory asset, a total of $39 million in maintenance expenses related to its scheduled fall 2020 outage, which it began to amortize in January 2021. The regulatory asset will be amortized until the completion of the next refueling and maintenance outage, which is scheduled for the spring of 2022. During an outage, depending on the availability of its other generation sources and the market prices for power, Ameren Missouri’s purchased power costs may increase and the amount of excess power available for sale may decrease versus non-outage years. Changes in purchased power costs and excess power available for sale are included in the FAC, which results in limited impacts to earnings.
•In August 2021, a three-judge panel of the United States Court of Appeals for the Eighth Circuit issued a decision that affirmed the United States District Court for the Eastern District of Missouri’s January 2017 liability ruling and the district court’s September 2019 remedy order as it related to the installation of a flue gas desulfurization system at the Rush Island Energy Center, but reversed the order as it related to the installation of a dry sorbent injection system at the Labadie Energy Center. For additional information on the NSR and Clean Air Act litigation, see Note 9 – Commitments and Contingencies under Part I, Item 1, of this report.
•Ameren Missouri and Ameren Illinois continue to make infrastructure investments and expect to seek increases to electric and natural gas rates to recover the cost of investments and earn an adequate return. Ameren Missouri and Ameren Illinois will also seek new, or to maintain existing, legislative solutions to address regulatory lag and to support investment in their utility infrastructure for the benefit of their customers. Ameren Missouri and Ameren Illinois continue to face cost recovery pressures, including limited economic growth in their service territories, economic impacts of the COVID-19 pandemic, customer conservation efforts, the impacts of additional customer energy-efficiency programs, and increased customer use of increasingly cost-effective technological advances, including private generation and energy storage. However, over the long-term, we expect the decreased demand to be partially offset by increased demand resulting from increased electrification of the economy for efficiencies and as a means to address economy-wide CO2 emission concerns. We expect that increased investments, including expected future investments for environmental compliance, system reliability improvements, and new generation sources, will result in rate base and revenue growth but also higher depreciation and financing costs.
•We are observing inflationary pressures on the prices of commodities, labor, services, materials, and supplies. Ameren Missouri and Ameren Illinois are generally allowed to pass on to customers prudently incurred costs for fuel, purchased power, and natural gas supply. Additionally, for certain non-commodity cost changes, the use of trackers, riders, and formula ratemaking, as applicable,
mitigates our exposure. The inflationary pressures could impact our ability to control costs and/or make substantial investments in our businesses, including our ability to recover costs and investments, and to earn our allowed ROEs within frameworks established by our regulators, while maintaining rates that are affordable to our customers.
Liquidity and Capital Resources
•Our customers’ payment for our services has been adversely affected by the COVID-19 pandemic. See the Results of Operations section above for additional information on our accounts receivable balances. Further, our liquidity and our capital expenditure plans could be adversely affected by other impacts resulting from the COVID-19 pandemic, including but not limited to potential impacts on our ability to access the capital markets on reasonable terms when needed and the timing of tax payments and the utilization of tax credits. We expect to make significant capital expenditures to improve our electric and natural gas utility infrastructure, however, disruptions to the capital markets and the ability of our suppliers and contractors to perform as required under their contracts could impact the execution of our capital investment strategy. For further discussion on the impacts to our ability to access the capital markets, see below.
•In February 2021, Ameren Missouri filed an update to its Smart Energy Plan with the MoPSC, which includes a five-year capital investment overview with a detailed one-year plan for 2021. The plan is designed to upgrade Ameren Missouri’s electric infrastructure and includes investments that will upgrade the grid and accommodate more renewable energy. Investments under the plan are expected to total approximately $8.4 billion over the five-year period from 2021 through 2025, with expenditures largely recoverable under the PISA and the RESRAM. The planned investments in 2024 and 2025 are based on the assumption that Ameren Missouri requests and receives MoPSC approval of an extension of the PISA through December 2028.
•In connection with Ameren Missouri’s 2020 IRP, Ameren established a goal of achieving net-zero carbon emissions by 2050. Ameren is also targeting a 50% CO2 emission reduction by 2030 and an 85% reduction by 2040 from the 2005 level. The plan, which is subject to review byIn August 2021, the MoPSC forissued an order affirming the plan’s compliance with Missouri law,law. The plan targets cleaner and more diverse sources of energy generation, including solar, wind, hydro, and nuclear power, and supports increased investment in new energy technologies. It also includes expanding renewable sources by adding 3,100 MWs of renewable generation by the end of 2030 and a total of 5,400 MWs of renewable generation by 2040. These amounts include 700 MWs related to the High Prairie and Atchison renewable energy centers, which will support Ameren Missouri’s compliance with the state of Missouri’s requirement of achieving 15% of native load sales from renewable energy sources beginning in 2021. The plan also includes advancing the retirement dates of the Sioux and Rush Island coal-fired energy centers to 2028 and 2039, respectively, which are subject to the approval of a change in the assets’ depreciable lives by the MoPSC in Ameren Missouri’s current electric service regulatory rate review, the continued implementation of customer energy-efficiency programs, and the expectation that Ameren Missouri will seek NRC approval for an extension of the operating license for the Callaway Energy Center beyond its current 2044 expiration date. Additionally, the plan includes retiring the Meramec and Labadie coal-fired energy centers at the end of their useful lives (by 2022 and 2042, respectively). Ameren Missouri’s plan could be affected by, among other factors: Ameren Missouri’s ability to obtain certificates of convenience and necessity from the MoPSC, and any other required approvals for the addition of renewable resources, retirement of energy centers, and new or continued customer energy-efficiency programs; the ability of developers to meet contractual commitments and timely complete projects, which is dependent upon the availability of necessary materials and equipment, including those that are affected by the disruptions in the global supply chain caused by the COVID-19 pandemic, among other things; the availability of federal production and investment tax credits related to renewable energy and Ameren
Missouri’s ability to use such credits; the cost of wind, solar, and other renewable generation and storage technologies; changes in environmental regulations, including those related to carbon emissions; energy prices and demand; and Ameren Missouri’s ability to obtain timely interconnection agreements with the MISO or other RTOs at an acceptable cost. The next integrated resource plan is expected to be filed in September 2023.
•In JulyAugust 2021, Missouri House Bill 734 was enacted, which will become effective in August 2021.became effective. The law allows Missouri electric utility companies to petition the MoPSC for a financing order to authorize the issuance of securitized utility tariff bonds to finance the cost of retiring coal-fired energy centers, including the repayment of existing debt.
•Through 2025, we expect to make significant capital expenditures to improve our electric and natural gas utility infrastructure, with a major portion directed to our transmission and distribution systems. We estimate that we will invest up to $17.8 billion (Ameren Missouri – up to $9.3 billion; Ameren Illinois – up to $8.2 billion; ATXI – up to $0.2 billion) of capital expenditures during the period from 2021 through 2025. Ameren’s and Ameren Missouri’s estimates include 300 MWs of wind generation at the Atchison Renewable Energy Center, but exclude incremental renewable generation investment opportunities of 1,200 MWs by 2025, which are included in Ameren Missouri’s 2020 IRP. As of the date of this filing, no regulatory approvals have been requested related to these opportunities. These planned investments are based on the assumption of continued constructive regulatory frameworks, including an assumption that Ameren Missouri requests and receives MoPSC approval of an extension of the PISA through December 2028.
•Environmental regulations, including those related to CO2 emissions, or other actions taken by the EPA or state regulators, or requirements that may result from the NSR and Clean Air Act Litigation discussed in Note 9 – Commitments and Contingencies under
Part I, Item 1, of this report, could result in significant increases in capital expenditures and operating costs. Regulations enacted by a prior federal administration can be reviewed and repealed, and replacement or alternative regulations can be proposed or adopted by the current federal administration including the EPA. The ultimate implementation of any of these regulations, as well as the timing of any such implementation, is uncertain. However, the individual or combined effects of existing and new environmental regulations could result in significant capital expenditures, increased operating costs, or the closure or alteration of some of Ameren Missouri’s coal-firedcoal and natural gas-fired energy centers. Ameren Missouri’s capital expenditures are subject to MoPSC prudence reviews, which could result in cost disallowances as well as regulatory lag. The cost of Ameren Illinois’ purchased power and natural gas purchased for resale could increase. However, Ameren Illinois expects that these costs would be recovered from customers with no material adverse effect on its results of operations, financial position, or liquidity. Ameren’s and Ameren Missouri’s earnings could benefit from increased investment to comply with environmental regulations if those investments are reflected and recovered on a timely basis in customer rates.
•The Ameren Companies have multiyear credit agreements that cumulatively provide $2.3 billion of credit through December 2024, subject to a 364-day repayment term for Ameren Missouri and Ameren Illinois, with the option to seek incremental commitments to increase the cumulative credit provided to $2.7 billion. See Note 3 – Short-term Debt and Liquidity under Part I, Item 1, of this report and Note 4 – Short-term Debt and Liquidity under Part II, Item 8, in the Form 10-K for additional information regarding the Credit Agreements. The Ameren Companies have no material maturities of long-term debt until the third quarter of 2022. WithATXI expects to issue long-term debt in the recently completedfourth quarter of 2021 and use the proceeds to repay a portion of its long-term note payable to Ameren (parent), Ameren Missouri, and Ameren Illinois debt issuances and availability under the Credit Agreements, as well as the proceeds from the recent settlement of the forward sale agreement and the ATM program sales,money pool borrowings. Ameren, Ameren Missouri, and Ameren Illinois believe that their liquidity is adequate given their expected operating cash flows, capital expenditures, and financing plans. The Ameren Companies continue to monitor the effect of the COVID-19 pandemic on their liquidity. To date, the Ameren Companies have been able to access the capital markets on reasonable terms when needed. However, there can be no assurance that significant changes in economic conditions, disruptions in the capital and credit markets, or other unforeseen events will not materially affect their ability to execute their expected operating, capital, or financing plans.
•Ameren expects its cash used for currently planned capital expenditures and dividends to exceed cash provided by operating activities over the next several years. As part of its funding plan for capital expenditures, Ameren is using newly issued shares of common stock, rather than market-purchased shares, to satisfy requirements under the DRPlus and employee benefit plans and expects to continue to do so through at least 2025. Ameren expects these issuances to provide equity of about $100 million annually. In addition, Ameren established an ATM program under which Ameren may offer and sell from time to time up to $750 million of its common stock, which includes the ability to enter into forward sales agreements, subject to market conditions and other factors. Ameren plans to issue approximately $30$300 million of equity in the second half of 2021 and approximately $300 million each year from 2022 to 2025 in addition to issuances under the DRPlus and employee benefit plans. Ameren expects its equity to total capitalization ratio to be approximately 45% through December 31, 2025, with the long-term intent to support solid investment-grade credit ratings. Ameren Missouri and Ameren Illinois expect to fund cash flow needs through debt issuances, adjustments of dividends to Ameren (parent), and/or capital contributions from Ameren (parent).
•As of JuneSeptember 30, 2021, Ameren had $105$130 million in tax benefits from federal and state income tax credit carryforwards and $85$35 million in tax benefits from federal and state net operating loss carryforwards, which will be utilized in future periods. Ameren expects federal income tax payments at the required minimum levels from 2021 to 2025 resulting from the anticipated use of production tax credits that
will be generated by Ameren Missouri’s High Prairie and Atchison renewable energy centers, existing tax net operating losses, tax credit carryforwards, tax overpayments, and outstanding refunds.
•As a result of the significant increase in customer demand and prices for natural gas and electricity experienced in mid-February 2021 due to extremely cold weather, for the month of February 2021, Ameren Missouri and Ameren Illinois had under-recovered commodity costs under the PGA and FAC (Ameren Missouri - PGA $53 million, FAC $50 million; Ameren Illinois - PGA $221 million). Ameren Missouri’s PGA and FAC under-recoveries are designed to be collected from customers over 12 months beginning November 2021 and eight months beginning October 2021, respectively. Longer recovery periods may be sought byIn October 2021, the MoPSC issued an order allowing Ameren Missouri or imposed byto extend the MoPSCcollection period for the cumulative PGA under-recovery as of August 2021, which includes the February 2021 under-recovery, from 12 months to 36 months beginning November 2021, to lessen the impact on customer rates. Ameren Illinois’Illinois expects to collect the PGA under-recovery is being collected from customers over 1218 months beginning April 2021, but the collection of the remaining balance may be extended to a new 12-month period at Ameren Illinois’ election to lessen the impact on customer rates.
The above items could have a material impact on our results of operations, financial position, and liquidity. Additionally, in the ordinary course of business, we evaluate strategies to enhance our results of operations, financial position, and liquidity. These strategies may include acquisitions, divestitures, opportunities to reduce costs or increase revenues, and other strategic initiatives to increase Ameren’s shareholder value. We are unable to predict which, if any, of these initiatives will be executed. The execution of these initiatives may have a material impact on our future results of operations, financial position, or liquidity.
REGULATORY MATTERS
See Note 2 – Rate and Regulatory Matters under Part I, Item 1, of this report.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
There have been no material changes to the quantitative and qualitative disclosures about interest rate risk, credit risk, investmentcommodity price risk, commodityinvestment price risk, and commodity supplier risk included in the Form 10-K. See Item 7A under Part II of the Form 10-K for a more detailed discussion of our market risk.
ITEM 4. CONTROLS AND PROCEDURES.
(a)Evaluation of Disclosure Controls and Procedures
As of JuneSeptember 30, 2021, evaluations were performed under the supervision and with the participation of management, including the principal executive officer and the principal financial officer of each of the Ameren Companies, of the effectiveness of the design and operation of such registrant’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange Act). Based on those evaluations, as of JuneSeptember 30, 2021, the principal executive officer and the principal financial officer of each of the Ameren Companies concluded that such disclosure controls and procedures are effective to provide assurance that information required to be disclosed in such registrant’s reports filed or submitted under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms and such information is accumulated and communicated to its management, including its principal executive officer and its principal financial officer, to allow timely decisions regarding required disclosure.
(b)Changes in Internal Controls over Financial Reporting
There has been no change in any of the Ameren Companies’ internal control over financial reporting during their most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, each of their internal control over financial reporting.
PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
We are involved in legal and administrative proceedings before various courts and agencies with respect to matters that arise in the ordinary course of business, some of which involve substantial amounts of money. We believe that the final disposition of these proceedings, except as otherwise disclosed in this report, will not have a material adverse effect on our results of operations, financial position, or liquidity. Risk of loss is mitigated, in some cases, by insurance or contractual or statutory indemnification. We believe that we have established appropriate reserves for potential losses. For additional information on material legal and administrative proceedings, see Note 2 – Rate and Regulatory Matters, Note 9 – Commitments and Contingencies, and Note 10 – Callaway Energy Center, under Part I, Item 1, of this report. Pursuant to Item 103(c)(3)(iii) of Regulation S-K, our policy is to disclose environmental proceedings to which a governmental entity is a party if we reasonably believe such proceedings will result in monetary sanctions of $1 million or more.
ITEM 1A. RISK FACTORS.
There have been no material changes toThe Form 10-K includes a detailed discussion of our risk factors. The information presented below updates, and should be read in conjunction with, the risk factors and information disclosed in Part I, Item 1A, Risk Factors in the Form 10-K.
The COVID-19 vaccine mandate issued under an executive order may have a material adverse effect on our results of operations, financial position, or liquidity.
In September 2021, President Biden issued an executive order directing that federal agencies require employers with United States government contracts to ensure that their United States-based employees, contractors, and subcontractors, at on-site and remote locations, are fully vaccinated for COVID-19, subject to certain exceptions for valid medical and religious reasons, as identified in applicable guidance. Without further change, the expected deadline for compliance is January 4, 2022. The executive order does not provide an exception for regular COVID-19 testing as an alternative to vaccination. As a United States government contractor, the Ameren Companies will be required to comply with the executive order’s vaccine mandate.
The timing of implementation of the executive order may be affected by additional guidance issued, including any extensions of time granted to comply. Compliance with the executive order or any future vaccine mandates may result in labor shortages, including shortages in skilled professional and technical labor, supply chain disruptions, delays in contractors’ performance or completion of work, and/or increased costs for us, our contractors, or our suppliers, which may have a material adverse effect on our results of operations, financial position, and liquidity.
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.
Ameren Corporation, Ameren Missouri, and Ameren Illinois did not purchase equity securities reportable under Item 703 of Regulation
S-K during the period from AprilJuly 1, 2021, to JuneSeptember 30, 2021.
ITEM 6. EXHIBITS.
The documents listed below are being filed or have previously been filed on behalf of the Ameren Companies and are incorporated herein by reference from the documents indicated and made a part hereof. Exhibits not identified as previously filed are filed herewith.
| | | | | | | | | | | | | | | | | | | | |
Exhibit
Designation | | Registrant(s) | | Nature of Exhibit | | Previously Filed as Exhibit to: |
|
| | | | | | |
Instruments Defining RightsArticles of Security Holders, Including IndenturesIncorporation/By-Laws |
4.13.1 | | Ameren
Ameren Missouri | | | | June 22,October 12, 2021 Form 8-K, Exhibit 4.2,3.1, File No. 1-2967 |
4.2 | | Ameren
Ameren Illinois | | | | June 29, 2021 Form 8-K, Exhibit 4.2, File No. 1-36721-14756 |
| Rule 13a-14(a) / 15d-14(a) Certifications |
| 31.1 | | Ameren | | | | |
| 31.2 | | Ameren | | | | |
| 31.3 | | Ameren Missouri | | | | |
| 31.4 | | Ameren Missouri | | | | |
| 31.5 | | Ameren Illinois | | | | |
| 31.6 | | Ameren Illinois | | | | |
| Section 1350 Certifications |
| 32.1 | | Ameren | | | | |
| 32.2 | | Ameren Missouri | | | | |
| 32.3 | | Ameren Illinois | | | | |
| Interactive Data Files |
| 101.INS | | Ameren Companies | | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | | |
| 101.SCH | | Ameren Companies | | Inline XBRL Taxonomy Extension Schema Document | | |
| 101.CAL | | Ameren Companies | | Inline XBRL Taxonomy Extension Calculation Linkbase Document | | |
| 101.LAB | | Ameren Companies | | Inline XBRL Taxonomy Extension Label Linkbase Document | | |
| 101.PRE | | Ameren Companies | | Inline XBRL Taxonomy Extension Presentation Linkbase Document | | |
| 101.DEF | | Ameren Companies | | Inline XBRL Taxonomy Extension Definition Document | | |
| 104 | | Ameren Companies | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | | |
The file number references for the Ameren Companies’ filings with the SEC are: Ameren, 1-14756; Ameren Missouri, 1-2967; and Ameren Illinois, 1-3672.
Each registrant hereby undertakes to furnish to the SEC upon request a copy of any long-term debt instrument not listed above that such registrant has not filed as an exhibit pursuant to the exemption provided by Item 601(b)(4)(iii)(A) of Regulation S-K.
SIGNATURES
Pursuant to the requirements of the Exchange Act, each registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. The signature for each undersigned company shall be deemed to relate only to matters having reference to such company or its subsidiaries.
| | |
|
AMEREN CORPORATION
(Registrant) |
|
| /s/ Michael L. Moehn |
Michael L. Moehn
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
UNION ELECTRIC COMPANY
(Registrant) |
|
| /s/ Michael L. Moehn |
Michael L. Moehn
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
|
|
AMEREN ILLINOIS COMPANY
(Registrant) |
|
| /s/ Michael L. Moehn |
Michael L. Moehn
Executive Vice President and Chief Financial Officer
(Principal Financial Officer)
|
Date: August 6,November 4, 2021
