8-KOther Events

AMEREN CORP 8-K Report, Corporate Update (Nov 22, 2006)

Filed November 22, 2006For Securities:AEE

Summary

This Form 8-K filing from Ameren Corporation, dated November 22, 2006, provides an update on rate case decisions from the Illinois Commerce Commission (ICC) concerning its subsidiaries: Central Illinois Public Service Company (CIPS), CILCORP Inc. (operating as AmerenCILCO or CILCO), and Illinois Power Company (operating as AmerenIP or IP). Specifically, the ICC issued an order on November 21, 2006, that impacts the requested revenue increases for electric delivery service. While CIPS initially sought an $14 million increase and CILCO requested $43 million, the ICC authorized a reduction of $8 million for CIPS and an increase of $20.7 million for CILCO. Illinois Power Company (IP), which had requested the largest increase of $145 million, was authorized a $83.9 million increase. These adjustments are effective January 2, 2007. The companies are currently evaluating the ICC's order, which is subject to appeal.

Key Highlights

  • 1The Illinois Commerce Commission (ICC) has issued a decision on rate increase requests for Ameren's Illinois subsidiaries.
  • 2Central Illinois Public Service Company (CIPS) will experience a rate reduction of $8 million, contrary to its request for an $14 million increase.
  • 3AmerenCILCO (CILCO) received an authorized revenue increase of $20.7 million, less than its requested $43 million.
  • 4AmerenIP (IP) was granted a significant revenue increase of $83.9 million, which is less than its requested $145 million.
  • 5The authorized rate adjustments are set to become effective on January 2, 2007.
  • 6Ameren and its subsidiaries are reviewing the ICC's order, which is subject to potential appeal.

Frequently Asked Questions

The main purpose of this 8-K filing is to inform investors about the Illinois Commerce Commission's (ICC) decision regarding the rate increase requests for Ameren's electric delivery service in Illinois, specifically for its subsidiaries CIPS, CILCO, and IP.

The ICC's decision was mixed compared to the requests. CIPS will see a reduction in rates, contrary to its requested increase. CILCO received an increase, but it was less than half of what was requested. IP received a substantial increase, but it was also lower than their initial request.

The filing indicates that CIPS will face an $8 million reduction in annual revenue from electric delivery service, while CILCO and IP will see increases of $20.7 million and $83.9 million, respectively. The net impact on Ameren's overall revenue will depend on the combined effect and the detailed evaluation of the order by the companies.

The ICC's order is effective January 2, 2007, but it is subject to appeal. Therefore, there is a possibility that the authorized rate adjustments could be modified if an appeal is filed and successful.