8-KOther EventsExhibits & Filings

AMEREN CORP 8-K Report, Corporate Update (Jun 5, 2009)

Filed June 5, 2009For Securities:AEE

Summary

Ameren Corporation (AEE), through its Illinois subsidiaries AmerenCIPS, AmerenCILCO, and AmerenIP, filed requests with the Illinois Commerce Commission (ICC) on June 5, 2009, seeking significant increases in electric and natural gas delivery service rates. The proposed increases are intended to recover costs and generate a reasonable return on investment based on an aggregate rate base of $2.4 billion for electric delivery and $1.0 billion for natural gas delivery. The filings are based on financial data from the test year ended December 31, 2008, and propose returns on equity within a specified range. Investors should note that the ICC proceedings are expected to take up to 11 months, with decisions anticipated by May 2010. Ameren's ability to recover its costs and earn a reasonable return is contingent upon the ICC's final approval, and the company cannot predict the final outcome of these rate cases. The total requested annual revenue increases from electric delivery service amount to $181 million ($51 million for CIPS, $28 million for CILCO, and $102 million for IP), and from natural gas delivery service total $45 million ($11 million for CIPS, $9 million for CILCO, and $25 million for IP).

Key Highlights

  • 1Ameren's Illinois utilities (AmerenCIPS, AmerenCILCO, AmerenIP) filed for electric and natural gas delivery rate increases with the Illinois Commerce Commission (ICC) on June 5, 2009.
  • 2Total requested annual increase for electric delivery rates is $181 million across the three utilities.
  • 3Total requested annual increase for natural gas delivery rates is $45 million across the three utilities.
  • 4The rate increase requests are based on an aggregate electric rate base of $2.4 billion and a natural gas rate base of $1.0 billion.
  • 5The proposed rates include a return on equity range of 11.75% to 12.25% for electric and 11.25% to 11.60% for natural gas.
  • 6ICC proceedings are expected to last up to 11 months, with decisions anticipated by May 2010.
  • 7Ameren cannot predict the final approved rate changes, their effective dates, or if they will be sufficient to cover costs and earn a reasonable return.

Frequently Asked Questions

This 8-K filing informs investors that Ameren's Illinois utility companies have formally requested approval from the Illinois Commerce Commission (ICC) to increase their electric and natural gas delivery service rates. These filings are a standard regulatory process for utilities to adjust rates based on costs and investments.

Collectively, the Ameren Illinois Utilities are seeking an annual increase of $181 million for electric delivery service and $45 million for natural gas delivery service. The specific amounts requested by each subsidiary (CIPS, CILCO, and IP) vary.

The Illinois Commerce Commission proceedings are expected to take up to 11 months, with decisions required by May 2010. The actual effective date of any approved rate changes will depend on the ICC's decision.

The primary risk for Ameren is that the ICC may not approve the full amount of the requested rate increases, or may delay their implementation. The company explicitly states it cannot predict the level of any approved rate change or whether it will be sufficient to recover costs and earn a reasonable return on investment.