AEE-2014 Q1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
 
ý
Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the Quarterly Period Ended March 31, 2014
OR
 
¨
Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from             to
 
Commission
File Number
  
Exact name of registrant as specified in its charter;
State of Incorporation;
Address and Telephone Number
  
IRS Employer
Identification No.
1-14756
  
Ameren Corporation
  
43-1723446
 
  
(Missouri Corporation)
  
 
 
  
1901 Chouteau Avenue
  
 
 
  
St. Louis, Missouri 63103
  
 
 
  
(314) 621-3222
  
 
 
 
 
1-2967
  
Union Electric Company
  
43-0559760
 
  
(Missouri Corporation)
  
 
 
  
1901 Chouteau Avenue
  
 
 
  
St. Louis, Missouri 63103
  
 
 
  
(314) 621-3222
  
 
 
 
 
1-3672
  
Ameren Illinois Company
  
37-0211380
 
  
(Illinois Corporation)
  
 
 
  
6 Executive Drive
  
 
 
  
Collinsville, Illinois 62234
  
 
 
  
(618) 343-8150
  
 
Indicate by check mark whether the registrants: (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.
 
Ameren Corporation
  
Yes
  
ý
  
No
  
¨
Union Electric Company
  
Yes
  
ý
  
No
  
¨
Ameren Illinois Company
  
Yes
  
ý
  
No
  
¨
Indicate by check mark whether each registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
 
Ameren Corporation
  
Yes
  
ý
  
No
  
¨
Union Electric Company
  
Yes
  
ý
  
No
  
¨
Ameren Illinois Company
  
Yes
  
ý
  
No
  
¨
Indicate by check mark whether each registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.



 
 
  
Large Accelerated
Filer
  
Accelerated
Filer
  
Non-Accelerated
Filer
  
Smaller Reporting
Company
Ameren Corporation
  
ý
  
¨
  
¨
  
¨
Union Electric Company
  
¨
  
¨
  
ý
  
¨
Ameren Illinois Company
  
¨
  
¨
  
ý
  
¨
Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
 
Ameren Corporation
  
Yes
  
¨
  
No
  
ý
Union Electric Company
  
Yes
  
¨
  
No
  
ý
Ameren Illinois Company
  
Yes
  
¨
  
No
  
ý
The number of shares outstanding of each registrant’s classes of common stock as of April 30, 2014, was as follows:
 
Ameren Corporation
 
Common stock, $0.01 par value per share - 242,634,798
Union Electric Company
 
Common stock, $5 par value per share, held by Ameren
Corporation (parent company of the registrant) - 102,123,834
Ameren Illinois Company
 
Common stock, no par value, held by Ameren
Corporation (parent company of the registrant) - 25,452,373
 
______________________________________________________________________________________________________ 
This combined Form 10-Q is separately filed by Ameren Corporation, Union Electric Company, and Ameren Illinois Company. Each registrant hereto is filing on its own behalf all of the information contained in this quarterly report that relates to such registrant. Each registrant hereto is not filing any information that does not relate to such registrant, and therefore makes no representation as to any such information.



TABLE OF CONTENTS
 
 
Page
 
 
 
 
 
 
 
 
Item 1.
 
 
 
 
 
 
Union Electric Company (d/b/a Ameren Missouri)
 
 
 
 
Ameren Illinois Company (d/b/a Ameren Illinois)
 
 
 
 
Item 2.
Item 3.
Item 4.
 
 
 
 
 
 
Item 1.
Item 1A.
Item 2.
Item 6.
 
 
This report contains “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements should be read with the cautionary statements and important factors under the heading “Forward-looking Statements.” Forward-looking statements are all statements other than statements of historical fact, including those statements that are identified by the use of the words “anticipates,” “estimates,” “expects,” “intends,” “plans,” “predicts,” “projects,” and similar expressions.




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

Form 10-K - The combined Annual Report on Form 10-K for the year ended December 31, 2013, filed by the Ameren Companies with the SEC. 
NEIL - Nuclear Electric Insurance Limited, which includes all of its affiliated companies.
 
FORWARD-LOOKING STATEMENTS
Statements in this report not based on historical facts are considered “forward-looking” and, accordingly, involve risks and uncertainties that could cause actual results to differ materially from those discussed. Although such forward-looking statements have been made in good faith and are based on reasonable assumptions, there is no assurance that the expected results will be achieved. These statements include (without limitation) statements as to future expectations, beliefs, plans, strategies, objectives, events, conditions, and financial performance. In connection with the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, we are providing this cautionary statement to identify important factors that could cause actual results to differ materially from those anticipated. The following factors, in addition to those discussed under Risk Factors in the Form 10-K, and elsewhere in this report and in our other filings with the SEC, could cause actual results to differ materially from management expectations suggested in such forward-looking statements:
regulatory, judicial, or legislative actions, including changes in regulatory policies and ratemaking determinations, such as the complaint cases filed by Noranda and 37 residential customers with the MoPSC in February 2014; the outcome of Ameren Illinois' appeals of the ICC's electric and natural gas rate orders issued in December 2013; Ameren Illinois' request for rehearing of a July 2012 FERC order regarding the inclusion of acquisition premiums in its transmission rates; the complaint case filed with FERC seeking a reduction in the allowed return on common equity under the MISO tariff; and future regulatory, judicial, or legislative actions that seek to change regulatory recovery mechanisms;
the effect of Ameren Illinois participating in a performance-based formula ratemaking process under the IEIMA, including the direct relationship between Ameren Illinois' return on common equity and the 30-year United States Treasury bond yields, the related financial commitments required by the IEIMA, and the resulting uncertain impact on
 
the financial condition, results of operations, and liquidity of Ameren Illinois;
the effects of Ameren Illinois' expected participation, beginning in 2015, in the regulatory framework provided by the state of Illinois' Natural Gas Consumer, Safety and Reliability Act, which allows for the use of a rider to recover costs of certain natural gas infrastructure investments made between rate cases;
the effects of increased competition in the future due to, among other things, deregulation of certain aspects of our business at either the state or federal levels and the implementation of deregulation;
changes in laws and other governmental actions, including monetary, fiscal, and tax policies;
the effects on demand for our services resulting from technological advances, including advances in energy efficiency and distributed generation sources, which generate electricity at the site of consumption;
increasing capital expenditure and operating expense requirements and our ability to timely recover these costs;
the cost and availability of fuel such as coal, natural gas, and enriched uranium used to produce electricity; the cost and availability of purchased power and natural gas for distribution; and the level and volatility of future market prices for such commodities, including our ability to recover the costs for such commodities;
the effectiveness of our risk management strategies and the use of financial and derivative instruments;
business and economic conditions, including their impact on interest rates, bad debt expense, and demand for our products;
disruptions of the capital markets, deterioration in credit metrics of the Ameren Companies, or other events that may make the Ameren Companies' access to necessary capital, including short-term credit and liquidity, impossible, more difficult, or more costly;
our assessment of our liquidity;
the impact of the adoption of new accounting guidance and the application of appropriate technical accounting rules and guidance;
actions of credit rating agencies and the effects of such actions;
the impact of weather conditions and other natural phenomena on us and our customers, including the impact of system outages;
generation, transmission, and distribution asset construction, installation, performance, and cost recovery;
the effects of our increasing investment in electric transmission projects and uncertainty as to whether we will achieve our expected returns in a timely fashion, if at all;
the extent to which Ameren Missouri prevails in its claims against insurers in connection with its Taum Sauk pumped-storage hydroelectric energy center incident;
the extent to which Ameren Missouri is permitted by its regulators to recover in rates the investments it made in connection with additional nuclear generation at its Callaway energy center;


1



operation of Ameren Missouri's Callaway energy center, including planned and unplanned outages, and decommissioning costs;
the effects of strategic initiatives, including mergers, acquisitions and divestitures, and any related tax implications;
the impact of current environmental regulations on utilities and power generating companies and new, more stringent or changing requirements, including those related to greenhouse gases, other emissions and discharges, cooling water intake structures, CCR, and energy efficiency, that are enacted over time and that could limit or terminate the operation of certain of our energy centers, increase our costs, result in an impairment of our assets, cause us to sell our assets, reduce our customers' demand for electricity or natural gas, or otherwise have a negative financial effect;
the impact of complying with renewable energy portfolio requirements in Missouri;
labor disputes, workforce reductions, future wage and employee benefits costs, including changes in discount rates and returns on benefit plan assets;
the inability of our counterparties to meet their obligations with respect to contracts, credit agreements, and financial instruments;
the cost and availability of transmission capacity for the energy generated by Ameren Missouri's energy centers or required to satisfy Ameren Missouri’s energy sales;
the inability of Dynegy and IPH to satisfy their indemnity and other obligations to Ameren in connection with the divestiture of New AER to IPH;
legal and administrative proceedings; and
acts of sabotage, war, terrorism, cyber attacks or intentionally disruptive acts.
Given these uncertainties, undue reliance should not be placed on these forward-looking statements. Except to the extent required by the federal securities laws, we undertake no obligation to update or revise publicly any forward-looking statements to reflect new information or future events.



2



PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
 
AMEREN CORPORATION
CONSOLIDATED STATEMENT OF INCOME (LOSS)
(Unaudited) (In millions, except per share amounts)
 
Three Months Ended March 31,
 
2014
 
2013
Operating Revenues:
 
 
 
Electric
$
1,106

 
$
1,088

Gas
488

 
387

Total operating revenues
1,594

 
1,475

Operating Expenses:
 
 
 
Fuel
204

 
213

Purchased power
112

 
151

Gas purchased for resale
304

 
230

Other operations and maintenance
420

 
399

Depreciation and amortization
181

 
175

Taxes other than income taxes
127

 
122

Total operating expenses
1,348

 
1,290

Operating Income
246

 
185

Other Income and Expenses:
 
 
 
Miscellaneous income
18

 
15

Miscellaneous expense
9

 
8

Total other income
9

 
7

Interest Charges
92

 
101

Income Before Income Taxes
163

 
91

Income Taxes
64

 
35

Income from Continuing Operations
99

 
56

Loss from Discontinued Operations, Net of Taxes (Note 12)
(1
)
 
(199
)
Net Income (Loss)
98

 
(143
)
Less: Net Income from Continuing Operations Attributable to Noncontrolling Interests
2

 
2

Net Income (Loss) Attributable to Ameren Corporation:
 
 
 
      Continuing Operations
97

 
54

      Discontinued Operations
(1
)
 
(199
)
Net Income (Loss) Attributable to Ameren Corporation
$
96

 
$
(145
)
 
 
 
 
Earnings (Loss) per Common Share – Basic:
 
 
 
          Continuing Operations
$
0.40

 
$
0.22

          Discontinued Operations

 
(0.82
)
Earnings (Loss) per Common Share – Basic
$
0.40

 
$
(0.60
)
 
 
 
 
 
 
 
 
Dividends per Common Share
$
0.40

 
$
0.40

Average Common Shares Outstanding – Basic
242.6

 
242.6

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

3



AMEREN CORPORATION
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
(Unaudited) (In millions)
 
 
Three Months Ended March 31,
 
2014
 
2013
Income from Continuing Operations
$
99

 
$
56

Other Comprehensive Income, Net of Taxes

 

Comprehensive Income from Continuing Operations
99

 
56

Less: Comprehensive Income from Continuing Operations Attributable to Noncontrolling Interests
2

 
2

Comprehensive Income from Continuing Operations Attributable to Ameren Corporation
97

 
54

 
 
 
 
Loss from Discontinued Operations, Net of Taxes
(1
)
 
(199
)
Other Comprehensive Loss from Discontinued Operations, Net of Taxes

 
(7
)
Comprehensive Loss from Discontinued Operations Attributable to Ameren Corporation
(1
)
 
(206
)
Comprehensive Income (Loss) Attributable to Ameren Corporation
$
96

 
$
(152
)
The accompanying notes are an integral part of these consolidated financial statements.

4



AMEREN CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited) (In millions, except per share amounts)
 
March 31, 2014
 
December 31, 2013
ASSETS
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
26

 
$
30

Accounts receivable – trade (less allowance for doubtful accounts of $26 and $18, respectively)
553

 
404

Unbilled revenue
236

 
304

Miscellaneous accounts and notes receivable
201

 
196

Materials and supplies
424

 
526

Current regulatory assets
220

 
156

Current accumulated deferred income taxes, net
95

 
106

Other current assets
70

 
85

Assets of discontinued operations (Note 12)
15

 
165

Total current assets
1,840

 
1,972

Property and Plant, Net
16,425

 
16,205

Investments and Other Assets:
 
 
 
Nuclear decommissioning trust fund
503

 
494

Goodwill
411

 
411

Intangible assets
17

 
22

Regulatory assets
1,251

 
1,240

Other assets
719

 
698

Total investments and other assets
2,901

 
2,865

TOTAL ASSETS
$
21,166

 
$
21,042

LIABILITIES AND EQUITY
 
 
 
Current Liabilities:
 
 
 
Current maturities of long-term debt
$
648

 
$
534

Short-term debt
700

 
368

Accounts and wages payable
559

 
806

Taxes accrued
89

 
55

Interest accrued
104

 
86

Current regulatory liabilities
248

 
216

Other current liabilities
344

 
351

Liabilities of discontinued operations (Note 12)
33

 
45

Total current liabilities
2,725

 
2,461

Long-term Debt, Net
5,226

 
5,504

Deferred Credits and Other Liabilities:
 
 
 
Accumulated deferred income taxes, net
3,340

 
3,250

Accumulated deferred investment tax credits
62

 
63

Regulatory liabilities
1,751

 
1,705

Asset retirement obligations
373

 
369

Pension and other postretirement benefits
480

 
466

Other deferred credits and liabilities
554

 
538

Total deferred credits and other liabilities
6,560

 
6,391

Commitments and Contingencies (Notes 2, 9, 10 and 12)


 


Ameren Corporation Stockholders’ Equity:
 
 
 
Common stock, $.01 par value, 400.0 shares authorized – shares outstanding of 242.6
2

 
2

Other paid-in capital, principally premium on common stock
5,602

 
5,632

Retained earnings
906

 
907

Accumulated other comprehensive income
3

 
3

Total Ameren Corporation stockholders’ equity
6,513

 
6,544

Noncontrolling Interests
142

 
142

Total equity
6,655

 
6,686

TOTAL LIABILITIES AND EQUITY
$
21,166

 
$
21,042

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

5



AMEREN CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
 
Three Months Ended March 31,
 
2014
 
2013
Cash Flows From Operating Activities:
 
 
 
Net income (loss)
$
98

 
$
(143
)
Loss from discontinued operations, net of taxes
1

 
199

Adjustments to reconcile net income (loss) to net cash provided by operating activities:
 
 
 
Depreciation and amortization
176

 
166

Amortization of nuclear fuel
24

 
20

Amortization of debt issuance costs and premium/discounts
5

 
6

Deferred income taxes and investment tax credits, net
84

 
40

Allowance for equity funds used during construction
(7
)
 
(8
)
Stock-based compensation costs
9

 
9

Other
(1
)
 
(3
)
Changes in assets and liabilities:
 
 
 
Receivables
(86
)
 
(95
)
Materials and supplies
102

 
127

Accounts and wages payable
(183
)
 
(127
)
Taxes accrued
18

 
41

Assets, other
(90
)
 
52

Liabilities, other
49

 
29

Pension and other postretirement benefits
30

 
3

Counterparty collateral, net
10

 
26

Net cash provided by operating activities – continuing operations
239

 
342

Net cash provided by operating activities – discontinued operations

 
37

Net cash provided by operating activities
239

 
379

Cash Flows From Investing Activities:
 
 
 
Capital expenditures
(442
)
 
(275
)
Nuclear fuel expenditures
(10
)
 
(11
)
Purchases of securities – nuclear decommissioning trust fund
(186
)
 
(35
)
Sales and maturities of securities – nuclear decommissioning trust fund
182

 
32

Proceeds from note receivable – Marketing Company
56

 

Contributions to note receivable – Marketing Company
(65
)
 

Other

 
(2
)
Net cash used in investing activities – continuing operations
(465
)
 
(291
)
Net cash provided by (used in) investing activities – discontinued operations
152

 
(12
)
Net cash used in investing activities
(313
)
 
(303
)
Cash Flows From Financing Activities:
 
 
 
Dividends on common stock
(97
)
 
(97
)
Dividends paid to noncontrolling interest holders
(2
)
 
(2
)
Short-term debt, net
332

 

Redemptions of long-term debt
(163
)
 

Net cash provided by (used in) financing activities – continuing operations
70

 
(99
)
Net cash used in financing activities – discontinued operations

 

Net cash provided by (used in) financing activities
70

 
(99
)
Net change in cash and cash equivalents
(4
)
 
(23
)
Cash and cash equivalents at beginning of year
30

 
209

Cash and cash equivalents at end of period
26

 
186

Less cash and cash equivalents at end of period – discontinued operations

 
25

Cash and cash equivalents at end of period – continuing operations
$
26

 
$
161

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

6



 
UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)
STATEMENT OF INCOME AND COMPREHENSIVE INCOME
(Unaudited) (In millions)
 
Three Months Ended March 31,
 
2014
 
2013
Operating Revenues:
 
 
 
Electric
$
749

 
$
732

Gas
68

 
64

Total operating revenues
817

 
796

Operating Expenses:
 
 
 
Fuel
204

 
213

Purchased power
33

 
26

Gas purchased for resale
40

 
37

Other operations and maintenance
227

 
221

Depreciation and amortization
116

 
111

Taxes other than income taxes
78

 
77

Total operating expenses
698

 
685

Operating Income
119

 
111

Other Income and Expenses:
 
 
 
Miscellaneous income
14

 
14

Miscellaneous expense
4

 
5

Total other income
10

 
9

Interest Charges
52

 
60

Income Before Income Taxes
77

 
60

Income Taxes
29

 
19

Net Income
48

 
41

Other Comprehensive Income

 

Comprehensive Income
$
48

 
$
41

 
 
 
 
 
 
 
 
Net Income
$
48

 
$
41

Preferred Stock Dividends
1

 
1

Net Income Available to Common Stockholder
$
47

 
$
40

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

7



UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)
BALANCE SHEET
(Unaudited) (In millions, except per share amounts)
 
March 31, 2014
 
December 31, 2013
ASSETS
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$

 
$
1

Accounts receivable – trade (less allowance for doubtful accounts of $7 and $5, respectively)
218

 
191

Accounts receivable – affiliates
1

 
1

Unbilled revenue
129

 
168

Miscellaneous accounts and notes receivable
67

 
57

Materials and supplies
338

 
352

Current regulatory assets
145

 
118

Other current assets
50

 
71

Total current assets
948

 
959

Property and Plant, Net
10,499

 
10,452

Investments and Other Assets:
 
 
 
Nuclear decommissioning trust fund
503

 
494

Intangible assets
17

 
22

Regulatory assets
539

 
534

Other assets
442

 
443

Total investments and other assets
1,501

 
1,493

TOTAL ASSETS
$
12,948

 
$
12,904

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current Liabilities:
 
 
 
Current maturities of long-term debt
$
223

 
$
109

Borrowings from money pool

 
105

Short-term debt
290

 

Accounts and wages payable
183

 
387

Accounts payable – affiliates
38

 
30

Taxes accrued
252

 
220

Interest accrued
47

 
57

Current regulatory liabilities
47

 
57

Other current liabilities
87

 
82

Total current liabilities
1,167

 
1,047

Long-term Debt, Net
3,535

 
3,648

Deferred Credits and Other Liabilities:
 
 
 
Accumulated deferred income taxes, net
2,551

 
2,524

Accumulated deferred investment tax credits
58

 
59

Regulatory liabilities
1,062

 
1,041

Asset retirement obligations
371

 
366

Pension and other postretirement benefits
198

 
189

Other deferred credits and liabilities
43

 
37

Total deferred credits and other liabilities
4,283

 
4,216

Commitments and Contingencies (Notes 2, 8, 9 and 10)


 


Stockholders’ Equity:
 
 
 
Common stock, $5 par value, 150.0 shares authorized – 102.1 shares outstanding
511

 
511

Other paid-in capital, principally premium on common stock
1,560

 
1,560

Preferred stock not subject to mandatory redemption
80

 
80

Retained earnings
1,812

 
1,842

Total stockholders’ equity
3,963

 
3,993

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
12,948

 
$
12,904

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

8



UNION ELECTRIC COMPANY (d/b/a AMEREN MISSOURI)
STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
 
Three Months Ended March 31,
 
2014
 
2013
Cash Flows From Operating Activities:
 
 
 
Net income
$
48

 
$
41

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
112

 
104

Amortization of nuclear fuel
24

 
20

Amortization of debt issuance costs and premium/discounts
2

 
2

Deferred income taxes and investment tax credits, net
30

 
(8
)
Allowance for equity funds used during construction
(7
)
 
(7
)
Changes in assets and liabilities:
 
 
 
Receivables
2

 
(50
)
Materials and supplies
14

 
22

Accounts and wages payable
(153
)
 
(139
)
Taxes accrued
30

 
38

Assets, other
(28
)
 
38

Liabilities, other
7

 
5

Pension and other postretirement benefits
15

 
2

Net cash provided by operating activities
96

 
68

Cash Flows From Investing Activities:
 
 
 
Capital expenditures
(188
)
 
(137
)
Nuclear fuel expenditures
(10
)
 
(11
)
Money pool advances, net

 
24

Purchases of securities – nuclear decommissioning trust fund
(186
)
 
(35
)
Sales and maturities of securities – nuclear decommissioning trust fund
182

 
32

Other
(2
)
 
(2
)
Net cash used in investing activities
(204
)
 
(129
)
Cash Flows From Financing Activities:
 
 
 
Dividends on common stock
(77
)
 
(90
)
Dividends on preferred stock
(1
)
 
(1
)
Short-term debt, net
290

 

Money pool borrowings, net
(105
)
 
5

Net cash provided by (used in) financing activities
107

 
(86
)
Net change in cash and cash equivalents
(1
)
 
(147
)
Cash and cash equivalents at beginning of year
1

 
148

Cash and cash equivalents at end of period
$

 
$
1

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


9



 
AMEREN ILLINOIS COMPANY (d/b/a AMEREN ILLINOIS)
STATEMENT OF INCOME AND COMPREHENSIVE INCOME
(Unaudited) (In millions)
 
Three Months Ended March 31,
 
2014
 
2013
Operating Revenues:
 
 
 
Electric
$
353

 
$
360

Gas
421

 
324

Total operating revenues
774

 
684

Operating Expenses:
 
 
 
Purchased power
81

 
127

Gas purchased for resale
264

 
193

Other operations and maintenance
200

 
176

Depreciation and amortization
63

 
61

Taxes other than income taxes
46

 
42

Total operating expenses
654

 
599

Operating Income
120

 
85

Other Income and Expenses:
 
 
 
Miscellaneous income
3

 
1

Miscellaneous expense
4

 
3

Total other expense
(1
)
 
(2
)
Interest Charges
30

 
31

Income Before Income Taxes
89

 
52

Income Taxes
35

 
20

Net Income
54

 
32

Other Comprehensive Loss, Net of Taxes:
 
 
 
Pension and other postretirement benefit plan activity, net of income taxes (benefit) of $(1) and $(1), respectively
(1
)
 
(1
)
Comprehensive Income
$
53

 
$
31

 
 
 
 
 
 
 
 
Net Income
$
54

 
$
32

Preferred Stock Dividends
1

 
1

Net Income Available to Common Stockholder
$
53

 
$
31

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


10



AMEREN ILLINOIS COMPANY (d/b/a AMEREN ILLINOIS)
BALANCE SHEET
(Unaudited) (In millions)
 
March 31, 2014
 
December 31, 2013
ASSETS
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
1

 
$
1

Accounts receivable – trade (less allowance for doubtful accounts of $18 and $13, respectively)
328

 
201

Unbilled revenue
107

 
135

Miscellaneous accounts receivable
8

 
13

Materials and supplies
86

 
174

Current regulatory assets
75

 
38

Current accumulated deferred income taxes, net
52

 
45

Other current assets
20

 
26

Total current assets
677

 
633

Property and Plant, Net
5,731

 
5,589

Investments and Other Assets:
 
 
 
Goodwill
411

 
411

Regulatory assets
706

 
701

Other assets
115

 
120

Total investments and other assets
1,232

 
1,232

TOTAL ASSETS
$
7,640

 
$
7,454

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current Liabilities:
 
 
 
Borrowings from money pool
$
242

 
$
56

Accounts and wages payable
230

 
243

Accounts payable – affiliates
28

 
18

Taxes accrued
22

 
23

Customer deposits
80

 
79

Current environmental remediation
46

 
43

Current regulatory liabilities
201

 
159

Other current liabilities
153

 
150

Total current liabilities
1,002

 
771

Long-term Debt, Net
1,692

 
1,856

Deferred Credits and Other Liabilities:
 
 
 
Accumulated deferred income taxes, net
1,158

 
1,116

Accumulated deferred investment tax credits
4

 
4

Regulatory liabilities
689

 
664

Pension and other postretirement benefits
200

 
197

Environmental remediation
222

 
232

Other deferred credits and liabilities
173

 
166

Total deferred credits and other liabilities
2,446

 
2,379

Commitments and Contingencies (Notes 2, 8 and 9)


 


Stockholders’ Equity:
 
 
 
Common stock, no par value, 45.0 shares authorized – 25.5 shares outstanding

 

Other paid-in capital
1,965

 
1,965

Preferred stock not subject to mandatory redemption
62

 
62

Retained earnings
463

 
410

Accumulated other comprehensive income
10

 
11

Total stockholders’ equity
2,500

 
2,448

TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
$
7,640

 
$
7,454


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

11



AMEREN ILLINOIS COMPANY (d/b/a AMEREN ILLINOIS)
STATEMENT OF CASH FLOWS
(Unaudited) (In millions)
 
Three Months Ended March 31,
 
2014
 
2013
Cash Flows From Operating Activities:
 
 
 
Net income
$
54

 
$
32

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
62

 
60

Amortization of debt issuance costs and premium/discounts
3

 
3

Deferred income taxes and investment tax credits, net
36

 
50

Other
(2
)
 
(1
)
Changes in assets and liabilities:
 
 
 
Receivables
(94
)
 
(58
)
Materials and supplies
88

 
105

Accounts and wages payable
14

 
9

Taxes accrued
(1
)
 
3

Assets, other
(61
)
 
16

Liabilities, other
71

 
24

Pension and other postretirement benefits
10

 
1

Counterparty collateral, net
12

 
27

Net cash provided by operating activities
192

 
271

Cash Flows From Investing Activities:
 
 
 
Capital expenditures
(215
)
 
(133
)
Money pool advances, net

 
(5
)
Other
1

 

Net cash used in investing activities
(214
)
 
(138
)
Cash Flows From Financing Activities:
 
 
 
Dividends on common stock

 
(15
)
Dividends on preferred stock
(1
)
 
(1
)
Money pool borrowings, net
186

 
(24
)
Redemptions of long-term debt
(163
)
 

Net cash provided by (used in) financing activities
22

 
(40
)
Net change in cash and cash equivalents

 
93

Cash and cash equivalents at beginning of year
1

 

Cash and cash equivalents at end of period
$
1

 
$
93

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


12



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)
March 31, 2014
NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General
Ameren, headquartered in St. Louis, Missouri, is a public utility holding company under PUHCA 2005, administered by FERC. Ameren’s 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. Also see the Glossary of Terms and Abbreviations at the front of this report and in the Form 10-K.
Union Electric Company, doing business as Ameren Missouri, operates a rate-regulated electric generation, transmission, and distribution business, and a rate-regulated natural gas transmission and distribution business in Missouri. Ameren Missouri supplies electric service to 1.2 million customers and natural gas service to 127,000 customers.
Ameren Illinois Company, doing business as Ameren Illinois, operates a rate-regulated electric and natural gas transmission and distribution business in Illinois. Ameren Illinois supplies electric service to 1.2 million customers and natural gas service to 807,000 customers.
Ameren has various other subsidiaries responsible for activities such as the provision of shared services. Ameren also has a subsidiary, ATXI, that operates a FERC rate-regulated electric transmission business and is developing the Illinois Rivers project.
The operating results, assets, and liabilities for New AER and the Elgin, Gibson City, Grand Tower, Meredosia, and Hutsonville energy centers have been presented separately as
 
discontinued operations for all periods presented in this report. Unless otherwise stated, these notes to Ameren’s financial statements exclude discontinued operations for all periods presented. On January 31, 2014, Medina Valley completed its sale of the Elgin, Gibson City, and Grand Tower gas-fired energy centers to Rockland Capital. See Note 12 - Divestiture Transactions and Discontinued Operations in this report for additional information regarding the discontinued operations presentation and Note 16 - Divestiture Transactions and Discontinued Operations under Part II, Item 8, of the Form 10-K for additional information regarding Ameren’s divestiture of New AER in December 2013.
The financial statements of Ameren are prepared on a consolidated basis, and therefore include the accounts of its majority-owned subsidiaries. All significant intercompany transactions have been eliminated. Ameren Missouri and Ameren Illinois have no subsidiaries, and therefore their financial statements are not prepared on a consolidated basis. All tabular dollar amounts are in millions, unless otherwise indicated.
Our accounting policies conform to GAAP. Our financial statements reflect all adjustments (which include normal, recurring adjustments) that are necessary, in our opinion, for a fair presentation of our results. The preparation of financial statements in conformity with GAAP requires management to make certain estimates and assumptions. Such estimates and assumptions affect reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the dates of financial statements, and the reported amounts of revenues and expenses during the reported periods. Actual results could differ from those estimates. The results of operations of an interim period may not give a true indication of results that may be expected for a full year. These financial statements should be read in conjunction with the financial statements and the notes thereto included in the Form 10-K.
Earnings Per Share
There were no material differences between Ameren’s basic and diluted earnings per share amounts for the three months ended March 31, 2014, and 2013, caused by the assumed settlement of performance share units. The number of dilutive performance share units had an immaterial impact on earnings per share.

Stock-based Compensation
Ameren’s long-term incentive plan available for eligible employees, the 2006 Omnibus Incentive Compensation Plan (2006 Plan), was replaced prospectively for new grants only by the 2014 Omnibus Incentive Compensation Plan (2014 Plan) effective April 24, 2014. The 2014 Plan provides for a maximum of 8 million common shares to be available for grant to eligible employees and directors, and retains many of the features of the 2006 Plan. The 2014 Plan awards may be stock options, stock appreciation rights, restricted stock, restricted stock units, performance shares, performance share units, cash-based awards, and other stock-based awards.

13



A summary of nonvested performance share units at March 31, 2014, and changes during the three months ended March 31, 2014, under the 2006 Plan are presented below:
 
Performance Share Units
 
Share Units
Weighted-average Fair Value Per Unit at Grant Date
Nonvested at January 1, 2014
1,218,544

$
33.23

Granted(a)
680,606

38.90

Forfeitures
(46,758
)
33.29

Vested(b)
(116,297
)
38.81

Nonvested at March 31, 2014
1,736,095

$
35.08

(a)
Includes performance share units (share units) granted to certain executive and nonexecutive officers and other eligible employees in 2014 under the 2006 Plan.
(b)
Share units vested due to the attainment of retirement eligibility by certain employees. Actual shares issued for retirement-eligible employees will vary depending on actual performance over the three-year measurement period.
The fair value of each share unit awarded in 2014 under the 2006 Plan was determined to be $38.90. That amount was based on Ameren’s closing common share price of $36.16 at December 31, 2013, and lattice simulations. Lattice simulations are used to estimate expected share payout based on Ameren’s total stockholder return for a three-year performance period relative to the designated peer group beginning January 1, 2014. The simulations can produce a greater fair value for the share unit than the applicable closing common share price because they include the weighted payout scenarios in which an increase in the share price has occurred. The significant assumptions used to calculate fair value also included a three-year risk-free rate of 0.78%, volatility of 12% to 18% for the peer group, and Ameren’s attainment of a three-year average earnings per share threshold during the performance period.
Intangible Assets
Ameren and Ameren Missouri classify renewable energy credits and emission allowances as intangible assets. Ameren Illinois consumes renewable energy credits as they are purchased through the IPA procurement process and expenses them immediately. We evaluate intangible assets for impairment if events or changes in circumstances indicate that their carrying amount might be impaired.
At March 31, 2014, Ameren’s and Ameren Missouri’s intangible assets consisted of renewable energy credits obtained through wind and solar power purchase agreements. The book value of Ameren’s and Ameren Missouri’s renewable energy credits was $17 million each at March 31, 2014. The book value of Ameren’s and Ameren Missouri’s renewable energy credits was $22 million each at December 31, 2013.
Ameren Missouri’s and Ameren Illinois’ renewable energy credits and Ameren Missouri’s emission allowances are charged to “Purchased power” expense and “Fuel” expense, respectively, as they are used in operations. The following table presents amortization expense based on usage of renewable energy credits and emission allowances, net of gains from sales, for Ameren, Ameren Missouri and Ameren Illinois, during the three months ended March 31, 2014, and 2013:
 
 
Three Months
 
2014
 
2013
Ameren Missouri
$
6

(a) 
$
(b)

Ameren Illinois
 
3

 
 
4

Ameren
$
9

 
$
4

(a)
Includes higher priced renewable energy credits. 
(b)
Less than $1 million.
Excise Taxes
Excise taxes levied on us are reflected on Ameren Missouri electric customer bills and on Ameren Missouri and Ameren Illinois natural gas customer bills. They are recorded gross in “Operating Revenues - Electric,” “Operating Revenues - Gas” and “Operating Expenses - Taxes other than income taxes” on the statement of income or the statement of income and comprehensive income. Excise taxes reflected on Ameren Illinois electric customer bills are imposed on the customer and are therefore not included in revenues and expenses. They are included in “Taxes accrued” on the balance sheet. The following table presents excise taxes recorded in “Operating Revenues - Electric,” “Operating Revenues - Gas” and “Operating Expenses - Taxes other than income taxes” for the three months ended March 31, 2014, and 2013:
 
Three months
 
2014
 
2013
Ameren Missouri
$
34

 
$
33

Ameren Illinois
26

 
22

Ameren
$
60

 
$
55

Uncertain Tax Positions
The following table presents the amount of unrecognized tax benefits (detriments) as of March 31, 2014, and December 31, 2013:
 
March 31,
2014
 
December 31,
2013
 
 
Ameren
$
92

 
$
90

Ameren Missouri
32

 
31

Ameren Illinois
(1
)
 
(1
)


14



With the adoption of new accounting guidance in the first quarter of 2014, unrecognized tax benefits are recorded in “Accumulated deferred income taxes, net” as a reduction to the deferred tax assets for net operating loss and tax credit carryforwards on Ameren’s, Ameren Missouri’s and Ameren Illinois’ balance sheets. Unrecognized tax benefits that exceed these carryforwards are recorded in “Other deferred credits and liabilities” on the respective balance sheets. At March 31, 2014, unrecognized tax benefits of $84 million, $14 million, and $- million were recorded in “Accumulated deferred income taxes, net” on Ameren's, Ameren Missouri's and Ameren Illinois' balance sheets, respectively. At December 31, 2013, unrecognized tax benefits of $84 million, $15 million, and $- million previously recorded in “Other deferred credits and liabilities” on the respective balance sheets were reclassified to “Accumulated deferred income taxes, net” for comparative purposes. For additional information see the Accounting and Reporting Developments section below.
The following table presents the amount of unrecognized tax benefits (detriments) as of March 31, 2014, and 2013, that would impact the effective tax rate, if recognized:
 
March 31,
2014
 
December 31,
2013
 
 
Ameren
$
55

 
$
54

Ameren Missouri
2

 
3

Ameren Illinois
(1
)
 

Ameren’s federal income tax returns for the years 2007 through 2011 are before the Appeals Office of the IRS. Ameren’s federal income tax return for the year 2012 is currently under examination.
 
It is reasonably possible that a settlement will be reached with the Appeals Office of the IRS in the next 12 months for the years 2007 through 2011. This settlement, which is primarily related to uncertain tax positions for research tax deductions, is expected to result in a decrease in uncertain tax benefits of $20 million and $13 million for Ameren and Ameren Missouri, respectively. In addition, it is reasonably possible that other events will occur during the next 12 months that would cause the total amount of unrecognized tax benefits for the Ameren Companies to increase or decrease. However, the Ameren Companies do not believe any such increases or decreases, including the decrease from the reasonably possible IRS Appeals Office settlement discussed above, would be material to their results of operations, financial position, or liquidity.
State income tax returns are generally subject to examination for a period of three years after filing of the return. The Ameren Companies do not currently have material state income tax issues under examination, administrative appeals, or litigation. The state impact of any federal changes remains subject to examination by various states for a period of up to one year after formal notification to the states.
Asset Retirement Obligations
AROs at Ameren, Ameren Missouri and Ameren Illinois increased at March 31, 2014, compared to December 31, 2013, to reflect the accretion of obligations to their fair value, partially offset by immaterial settlements.

Noncontrolling Interests
As of March 31, 2014, Ameren's noncontrolling interests were composed of the preferred stock not subject to mandatory redemption of Ameren Missouri and Ameren Illinois. All noncontrolling interests are classified as a component of equity separate from Ameren's equity on its consolidated balance sheet. A reconciliation of the equity changes attributable to the noncontrolling interests at Ameren for the three months ended March 31, 2014, and 2013, are shown below:
  
Three Months
 
  
2014
 
2013
 
Noncontrolling interests, beginning of period
$
142

 
$
151

(a) 
Net income from continuing operations attributable to noncontrolling interests
2

 
2

 
Dividends paid to noncontrolling interest holders
(2
)
 
(2
)
 
Noncontrolling interests, end of period
$
142

 
$
151

(a) 
(a)
Included the 20% EEI ownership interest not owned by Ameren prior to the divestiture of New AER to IPH. Prior to the divestiture of New AER, the assets and liabilities of EEI were consolidated in Ameren’s balance sheet at a 100% ownership level and were included in “Assets of discontinued operations” and “Liabilities of discontinued operations.” The divestiture of New AER, which included EEI, was completed in the fourth quarter of 2013. See Note 12 - Divestiture Transactions and Discontinued Operations for additional information.
Accounting and Reporting Developments
The following is a summary of recently adopted authoritative accounting guidance.
Presentation of an Unrecognized Tax Benefit
In July 2013, FASB issued additional authoritative
 
accounting guidance to provide clarity for the financial statement presentation of an unrecognized tax benefit when a net operating loss carryforward, a similar tax loss, or a tax credit carryforward exists. The objective of this guidance is to eliminate diversity in practice related to the presentation of certain unrecognized tax benefits. It requires entities to present an unrecognized tax benefit as a reduction to a deferred tax asset for a net operating


15



loss carryforward, a similar tax loss, or a tax credit carryforward to the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is available under the tax law. This guidance was effective for the Ameren Companies beginning in the first quarter of 2014. Previously, unrecognized tax benefits were recorded in “Other deferred credits and liabilities” on Ameren's, Ameren Missouri's and Ameren Illinois' balance sheets. Beginning in the first quarter 2014, unrecognized tax benefits are recorded in “Accumulated deferred income taxes, net” as a reduction to the deferred tax assets for net operating loss and tax credit carryforwards on the respective balance sheets. Unrecognized tax benefits that exceed these carryforwards are recorded in “Other deferred credits and liabilities,” on the respective balance sheets. For comparative purposes, the Ameren Companies reclassified the December 31, 2013 balances in accordance with the new guidance as discussed in the Uncertain Tax Positions section above. The implementation of the additional authoritative accounting guidance did not affect the Ameren Companies' results of operations or liquidity, as this guidance is presentation-related only.
NOTE 2 - RATE AND REGULATORY MATTERS
Below is a summary of updates to significant regulatory proceedings and related lawsuits. See also Note 2 - Rate and Regulatory Matters under Part II, Item 8, of the Form 10-K. We are unable to predict the ultimate outcome of these matters, the timing of the final decisions of the various agencies and courts, or the impact on our results of operations, financial position, or liquidity.
Missouri
Accounting Authority Order
In July 2011, Ameren Missouri filed a request with the MoPSC for an accounting authority order that would allow Ameren Missouri to defer fixed costs totaling $36 million that were not previously recovered from Noranda as a result of the loss of load caused by the severe 2009 ice storm for potential recovery in a future electric rate case. In November 2013, the MoPSC issued an order approving Ameren Missouri’s request for an accounting authority order, which will allow Ameren Missouri to seek recovery of these fixed costs in a future electric rate case. Ameren Missouri will seek to recover these fixed costs in its next electric rate case, which it will file by July 15, 2014. In February 2014, MIEC and MoOPC filed appeals of the accounting authority order to the Missouri Court of Appeals, Western District.
Earnings Complaint and Rate Shift Complaint Cases
In February 2014, Ameren Missouri’s largest customer, Noranda, and 37 residential customers filed an earnings complaint case and a rate shift complaint case with the MoPSC. In the earnings complaint case, Noranda and the residential customers asserted that Ameren Missouri’s electric service business is earning more than the 9.8% return on equity authorized in the MoPSC's December 2012 electric rate order and requested that the MoPSC approve a $67 million reduction to
 
Ameren Missouri’s annual revenue requirement. Included in Noranda’s request is a reduction of Ameren Missouri’s authorized return on equity to 9.4%. The rate shift complaint case seeks to reduce Noranda’s electricity cost with an offsetting increase in electricity cost for Ameren Missouri’s other customers. While the rate shift proposal is revenue neutral to Ameren Missouri, Ameren Missouri does not believe that the proposed reduction to Noranda’s electric rates, which are significantly below Ameren Missouri’s cost of service, is appropriate or in the best interests of Ameren Missouri’s other electric customers. The MoOPC and MIEC have intervened in the earnings complaint case.
While the MoPSC has no time requirement by which it must issue an order in these cases, it has adopted procedural schedules that would render a decision in the rate shift case by August 6, 2014, and in the earnings complaint case by September 26, 2014. Ameren Missouri does not believe that a reduction in electric service rates is justified and will file testimony that supports that position, which is consistent with Ameren Missouri’s expected July 2014 rate case filing. The MoPSC has 11 months from when Ameren Missouri files its request to issue an order.
Illinois
IEIMA
Under the provisions of the IEIMA, Ameren Illinois’ electric delivery service rates are subject to an annual revenue requirement reconciliation to its actual costs. Throughout each year, Ameren Illinois records a regulatory asset or a regulatory liability and a corresponding increase or decrease to operating revenues for any differences between the revenue requirement in effect for that year and its estimate of the probable increase or decrease in the revenue requirement expected to ultimately be approved by the ICC based on that year's actual costs incurred. As of March 31, 2014, Ameren Illinois had recorded a regulatory asset of $24 million to reflect its expected 2014 revenue requirement reconciliation adjustment, with interest.
In September 2012 and December 2012, the ICC issued orders in Ameren Illinois’ IEIMA performance-based formula rate filings. Ameren Illinois appealed both orders to the Appellate Court of the Fourth District of Illinois. The primary issues Ameren Illinois appealed were the rate treatment of accumulated deferred income taxes and vacation obligations as well as the calculation of Ameren Illinois’ capital structure. In December 2013, the appellate court rendered its decision upholding the ICC’s September and December 2012 orders. Ameren Illinois filed an appeal to the Illinois Supreme Court in March 2014.
In December 2013, the ICC issued an order in Ameren Illinois' annual update filing, which was based on 2012 recoverable costs and expected net plant additions for 2013. The ICC order established rates for 2014. In February 2014, Ameren Illinois filed an appeal to the Appellate Court of the Fourth District of Illinois regarding the calculation of its capital structure and the rate treatment of accumulated deferred income taxes related to the transfer of former Ameren Missouri assets in Illinois to Ameren Illinois.


16



In April 2014, Ameren Illinois filed with the ICC its annual electric delivery service formula rate update to establish the revenue requirement used to set rates for 2015. Pending ICC approval, Ameren Illinois’ update filing will result in a $206 million increase in Ameren Illinois’ electric delivery service revenue requirement beginning in January 2015. This update reflects an increase to the annual formula rate based on 2013 actual costs and expected net plant additions for 2014; an increase to include the annual reconciliation of the revenue requirement in effect for 2013 to the actual costs incurred in that year; and an increase resulting from the conclusion of a refund to customers in 2014 for the 2012 revenue requirement reconciliation. An ICC decision on this April 2014 filing is expected by December 2014.
2013 Natural Gas Delivery Service Rate Case
In December 2013, the ICC issued a rate order that approved an increase in revenues for natural gas delivery service of $32 million. The revenue increase was based on a 9.1% return on equity, a capital structure composed of 51.7% common equity, and a rate base of $1.1 billion. The rate order was based on a 2014 future test year. The rate changes became effective January 1, 2014. In March 2014, Ameren Illinois filed an appeal of the allowed return on equity included in the ICC's order with the Appellate Court of the Fourth District of Illinois. Ameren Illinois sought a 10.4% return on equity in this rate case.
Federal
2011 Wholesale Distribution Rate Case
In January 2011, Ameren Illinois filed a request with FERC to increase its annual revenues for electric delivery service for its wholesale customers. These wholesale distribution revenues are treated as a deduction from Ameren Illinois’ revenue requirement in retail rate filings with the ICC. In March 2011, FERC issued an order authorizing the proposed rates to take effect, subject to refund when the final rates are determined. Ameren Illinois has reached a settlement with four of its nine wholesale customers, which have been approved by FERC and refunds have been issued. The impasse with the remaining five wholesale customers is awaiting final FERC action. In November 2012, a FERC administrative law judge issued an initial decision, which is now pending before FERC. The timing of a decision from FERC is uncertain and subsequent appeals are possible. In accordance with the administrative law judge's initial decision, Ameren and Ameren Illinois have both included on their balance sheets in “Current regulatory liabilities” an estimate of $14 million and $13 million as of March 31, 2014, and December 31, 2013, respectively, for the refund due to the remaining wholesale customers relating to billings for the period from March 2011 through March 2014.
Ameren Illinois Electric Transmission Rate Refund
In July 2012, FERC issued an order concluding that Ameren Illinois improperly included acquisition premiums, primarily goodwill, in determining the common equity used in its electric transmission formula rate, and thereby inappropriately recovered a higher amount from its electric transmission customers. The
 
order required Ameren Illinois to make refunds to customers for such improperly included amounts. In August 2012, Ameren Illinois filed a request for a rehearing of this order. It is unknown when FERC will rule on Ameren's rehearing request, as it is under no deadline to do so.
Ameren Illinois submitted a refund report in November 2012 and concluded that no refund was warranted. Several wholesale customers filed a protest with FERC regarding Ameren's conclusion that no refund was warranted. In June 2013, FERC issued an order that rejected Ameren Illinois' November 2012 refund report and provided guidance as to the filing of a new refund report. In July 2013, Ameren Illinois filed a revised refund report based on the guidance provided in the June 2013 order, as well as a request for a rehearing of that order. Ameren Illinois' July 2013 refund report also concluded that no refund was warranted. Ameren Illinois estimated the maximum pretax charge to earnings for this possible refund obligation through December 31, 2014 would be $19 million, before interest charges. If Ameren Illinois were to determine that a refund to its electric transmission customers is probable, a charge to earnings would be recorded for the refund in the period in which that determination was made.
FERC Complaint Case
In November 2013, a customer group filed a complaint case with FERC seeking a reduction in the allowed return on common equity to 9.15%, as well as a limit on the common equity ratio, under the MISO tariff. Currently, the FERC-allowed return on common equity for MISO transmission owners is 12.38%. This complaint case could result in a reduction to Ameren Illinois' and ATXI's allowed return on common equity. That reduction could also result in a refund for transmission service revenues earned after the filing of the complaint case in November 2013. FERC has not issued an order in this case, and it is under no deadline to do so. Ameren is not able to predict if or how FERC will rule on this complaint case.
Ameren Missouri Power Purchase Agreement with Entergy
Beginning in 2005, FERC issued a series of orders addressing a complaint filed in 2001 by the Louisiana Public Service Commission against Entergy and certain of its affiliates. The complaint alleged unjust and unreasonable cost allocations. As a result of the FERC orders, Entergy began billing Ameren Missouri in 2007 for additional charges under a 165-megawatt power purchase agreement, which expired August 31, 2009. In May 2012, FERC issued an order stating that Entergy should not have included additional charges to Ameren Missouri under the power purchase agreement. Pursuant to the order, in June 2012, Entergy paid Ameren Missouri $31 million. In July 2012, Entergy filed an appeal of FERC's January 2010 and May 2012 orders to the United States Court of Appeals for the District of Columbia Circuit, which was subsequently dismissed on a procedural issue. In November 2013, Entergy refiled the appeal of FERC's May 2012 order with the United States Court of Appeals for the District of Columbia Circuit. Ameren is not able to predict when or how the court will rule on Entergy's appeal.


17



The Louisiana Public Service Commission appealed FERC’s orders regarding Louisiana Public Service Commission’s complaint against Entergy Services, Inc. to the United States Court of Appeals for the District of Columbia Circuit. In April 2008, that court ordered further FERC proceedings regarding Louisiana Public Service Commission’s complaint. The court ordered FERC to explain its previous denial of retroactive refunds and the implementation of prospective charges. FERC’s decision on remand of the retroactive impact of these issues could have a financial impact on Ameren Missouri. Ameren Missouri is unable to predict when or how FERC will respond to the court’s decisions. Ameren Missouri estimates that it could incur an additional expense of up to $25 million if FERC orders retroactive application for the years 2001 to 2005. Ameren Missouri believes that the likelihood of incurring any expense is not probable, and therefore no liability has been recorded as of March 31, 2014.
Combined Construction and Operating License
In 2008, Ameren Missouri filed an application with the NRC for a COL for a new nuclear unit at Ameren Missouri's existing Callaway County, Missouri, energy center site. In 2009, Ameren
 
Missouri suspended its efforts to build a new nuclear unit at its existing Missouri nuclear energy center site, and the NRC suspended review of the COL application.
Ameren Missouri estimated the total cost required to obtain a small modular reactor COL to be $80 million to $100 million. As of March 31, 2014, Ameren Missouri had capitalized investments of $69 million for the development of a new nuclear energy center. Ameren Missouri is currently evaluating all potential nuclear technologies in order to maintain an option for nuclear power in the future.
All of Ameren Missouri's capitalized investments for the development of a new nuclear energy center will remain capitalized while management pursues options to maximize the value of its investment. If efforts to license additional nuclear generation are abandoned or management concludes it is probable the costs incurred will be disallowed in rates, a charge to earnings would be recognized in the period in which that determination is made.

NOTE 3 - SHORT-TERM DEBT AND LIQUIDITY
The liquidity needs of the Ameren Companies are typically supported through the use of available cash, short-term intercompany borrowings, drawings under committed credit agreements, or commercial paper issuances.
The 2012 Missouri Credit Agreement and the 2012 Illinois Credit Agreement, both of which expire on November 14, 2017, were not utilized for direct borrowings during the three months ended March 31, 2014, but they were used to support commercial paper issuances and to issue letters of credit. As of March 31, 2014, based on letters of credit issued under the 2012 Credit Agreements, as well as commercial paper outstanding, the aggregate amount of credit capacity available to Ameren (parent), Ameren Missouri and Ameren Illinois, collectively, at March 31, 2014, was $1.4 billion.
Commercial Paper
Ameren (parent) had $410 million and $368 million of commercial paper outstanding at March 31, 2014, and December 31, 2013, respectively. Ameren Missouri had $290 million and $- million of commercial paper outstanding at March 31, 2014, and December 31, 2013, respectively.
The following table summarizes the commercial paper activity and relevant interest rates under Ameren’s (parent) and Ameren Missouri’s commercial paper programs for the three months ended March 31, 2014, and 2013:
 
 
Ameren (parent)
Ameren Missouri
Ameren Consolidated
2014
 
 
 
 
 
Average daily commercial paper outstanding
 
$
339

 
$
200

$
539

Weighted-average interest rate
 
0.45
%
 
0.45
%
0.45
%
Peak commercial paper during period(a)
 
$
452

 
$
290

$
700

Peak interest rate
 
0.75
%
 
0.70
%
0.75
%
2013
 
 
 
 
 
Average daily commercial paper outstanding
 
$
2

 
$

$
2

Weighted-average interest rate
 
0.80
%
 
%
0.80
%
Peak commercial paper during period(a)
 
$
21

 
$

$
21

Peak interest rate
 
0.85
%
 
%
0.85
%
(a)
The timing of peak commercial paper issuances varies by company, and therefore the amounts presented by company might not equal the Ameren Consolidated peak commercial paper issuances for the period.
Indebtedness Provisions and Other Covenants
The information below presents a summary of the Ameren
 
Companies’ compliance with indebtedness provisions and other covenants within the 2012 Credit Agreements. See Note 4 – Short-term Debt and Liquidity under Part II, Item 8, in the Form


18



10-K for a detailed description of these provisions.
The 2012 Credit Agreements contain nonfinancial covenants, including restrictions on the ability to incur liens, to transact with affiliates, to dispose of assets, to make investments in or transfer assets to its affiliates, and to merge with other entities. The 2012 Credit Agreements require each of Ameren, Ameren Missouri and Ameren Illinois to maintain consolidated indebtedness of not more than 65% of its consolidated total capitalization pursuant to a defined calculation set forth in the agreements. As of March 31, 2014, the ratios of consolidated indebtedness to total consolidated capitalization, calculated in accordance with the provisions of the 2012 Credit Agreements, were 50%, 49% and 44%, for Ameren, Ameren Missouri and Ameren Illinois, respectively. In addition, under the 2012 Illinois Credit Agreement and by virtue of the cross-default provisions of the 2012 Missouri Credit Agreement, Ameren is required to maintain a ratio of consolidated funds from operations plus interest expense to consolidated interest expense of at least 2.0 to 1.0, to be calculated quarterly, as of the end of the most recent four fiscal quarters then ending, in accordance with the 2012 Illinois Credit Agreement. Ameren’s ratio as of March 31, 2014, was 5.6 to 1.0. Failure of a borrower to satisfy a financial covenant constitutes an immediate default under the applicable 2012 Credit Agreement. The calculation of Ameren’s ratios discussed above includes both continuing and discontinued operations.
None of the Ameren Companies' credit agreements or financing arrangements contain credit rating triggers that would cause a default or acceleration of repayment of outstanding balances. The Ameren Companies were in compliance with the provisions and covenants of their credit agreements at March 31, 2014.
 
Money Pools
Ameren has money pool agreements with and among its subsidiaries to coordinate and provide for certain short-term cash and working capital requirements. Ameren Services is responsible for the operation and administration of the money pool agreements.
Ameren Missouri, Ameren Illinois and Ameren Services may participate in the utility money pool as both lenders and borrowers. Ameren may participate in the money pools only as a lender. Surplus internal funds are contributed to the money pool from participants. The primary sources of external funds for the money pool are the 2012 Credit Agreements and the commercial paper programs. The total amount available to the pool participants from the money pool at any given time is reduced by the amount of borrowings made by participants, but is increased to the extent that the pool participants advance surplus funds to the money pool or remit funds from other external sources. The availability of funds is also determined by funding requirement limits established by regulatory authorizations. Participants receiving a loan under the money pool agreement must repay the principal amount of such loan, together with accrued interest. The rate of interest depends on the composition of internal and external funds in the money pool. The average interest rate for borrowing under the utility money pool for the three months ended March 31, 2014, was 0.39% (2013 - 0.11%).
See Note 8 - Related Party Transactions for the amount of interest income and expense from the money pool arrangements recorded by the Ameren Companies for the three months ended March 31, 2014, and 2013.

NOTE 4 - LONG-TERM DEBT AND EQUITY FINANCINGS
Ameren Missouri
In April 2014, Ameren Missouri issued $350 million of 3.50% senior secured notes due April 15, 2024, with interest payable semiannually on April 15 and October 15 of each year, beginning October 15, 2014. Ameren Missouri received $348 million. The proceeds were used to repay a portion of its short-term debt and will be used to repay at maturity $104 million of its 5.50% senior secured notes due May 15, 2014.
Ameren Illinois
In January 2014, Ameren Illinois redeemed the following environmental improvement and pollution control revenue bonds at par value plus accrued interest:
Environmental improvement and pollution control revenue bonds
Principal Amount
5.90% Series 1993 due 2023(a)
$
32

5.70% 1994A Series due 2024(a)
36

1993 Series C-1 5.95% due 2026
35

1993 Series C-2 5.70% due 2026
8

5.40% 1998A Series due 2028
19

5.40% 1998B Series due 2028
33

Total amount redeemed
$
163

(a)
Less than $1 million principal amount of the bonds remain outstanding after redemption.

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Indenture Provisions and Other Covenants
Ameren Missouri’s and Ameren Illinois’ indentures and articles of incorporation include covenants and provisions related to issuances of first mortgage bonds and preferred stock. Ameren Missouri and Ameren Illinois are required to meet certain ratios to issue additional first mortgage bonds and preferred stock. A failure to achieve these ratios would not result in a default under these covenants and provisions, but would restrict the companies’ ability to issue bonds or preferred stock. The following table summarizes the required and actual interest coverage ratios for interest charges and dividend coverage ratios and bonds and preferred stock issuable as of March 31, 2014, at an assumed annual interest rate of 6% and dividend rate of 7%.
 
 
Required Interest
Coverage Ratio(a)
 
Actual Interest
Coverage Ratio
 
Bonds Issuable(b)
 
Required Dividend
Coverage Ratio(c)
 
Actual Dividend
Coverage Ratio
 
Preferred Stock
Issuable
 
Ameren Missouri
 
≥2.0
 
4.7
$
4,018

 
≥2.5
 
118.8
$
2,272

 
Ameren Illinois
 
≥2.0
 
7.6
 
3,732

(d) 
≥1.5
 
2.7
 
203

(e) 
(a)
Coverage required on the annual interest charges on first mortgage bonds outstanding and to be issued. Coverage is not required in certain cases when additional first mortgage bonds are issued on the basis of retired bonds.
(b)
Amount of bonds issuable based either on required coverage ratios or unfunded property additions, whichever is more restrictive. The amounts shown also include bonds issuable based on retired bond capacity of $729 million and $454 million at Ameren Missouri and Ameren Illinois, respectively.
(c)
Coverage required on the annual dividend on preferred stock outstanding and to be issued, as required in the respective company’s articles of incorporation.
(d)
Amount of bonds issuable by Ameren Illinois based on unfunded property additions and retired bonds solely under the former IP mortgage indenture.
(e)
Preferred stock issuable is restricted by the amount of preferred stock that is currently authorized by Ameren Illinois’ articles of incorporation.
Ameren’s indenture does not require Ameren to comply with any quantitative financial covenants. The indenture does, however, include certain cross-default provisions. Specifically, either (1) the failure by Ameren to pay when due and upon expiration of any applicable grace period any portion of any Ameren indebtedness in excess of $25 million or (2) the acceleration upon default of the maturity of any Ameren indebtedness in excess of $25 million under any indebtedness agreement, including the 2012 Credit Agreements, constitutes a default under the indenture, unless such past due or accelerated debt is discharged or the acceleration is rescinded or annulled within a specified period.
Ameren Missouri and Ameren Illinois and certain other Ameren subsidiaries are subject to Section 305(a) of the Federal Power Act, which makes it unlawful for any officer or director of a public utility, as defined in the Federal Power Act, to participate in the making or paying of any dividend from any funds “properly included in capital account.” FERC has consistently interpreted the provision to allow dividends to be paid as long as (1) the source of the dividends is clearly disclosed, (2) the dividends are not excessive, and (3) there is no self-dealing on the part of corporate officials. At a minimum, Ameren believes that dividends can be paid by its subsidiaries that are public utilities from net income and retained earnings. In addition, under Illinois law, Ameren Illinois may not pay any dividend on its stock, unless, among other things, its earnings and earned surplus are sufficient
 
to declare and pay a dividend after provision is made for reasonable and proper reserves, or unless Ameren Illinois has specific authorization from the ICC.
Ameren Illinois’ articles of incorporation require dividend payments on its common stock to be based on ratios of common stock to total capitalization and other provisions related to certain operating expenses and accumulations of earned surplus. Ameren Illinois committed to FERC to maintain a minimum 30% ratio of common stock equity to total capitalization. As of March 31, 2014, Ameren Illinois’ ratio of common stock equity to total capitalization was 55%.
In order for the Ameren Companies to issue securities in the future, they will have to comply with all applicable requirements in effect at the time of any such issuances.
Off-Balance-Sheet Arrangements
At March 31, 2014, none of the Ameren Companies had any off-balance-sheet financing arrangements, other than operating leases entered into in the ordinary course of business. None of the Ameren Companies expect to engage in any significant off-balance-sheet financing arrangements in the near future. See Note - 12 Divestiture Transactions and Discontinued Operations for Ameren (parent) guarantees and letters of credit issued to support New AER based on the transaction agreement with IPH.


20



NOTE 5 - OTHER INCOME AND EXPENSES
The following table presents the components of “Other Income and Expenses” in the Ameren Companies’ statements of income (loss) for the three months ended March 31, 2014, and 2013:
 
Three Months
 
 
2014
 
2013
 
Ameren:(a)
 
 
 
 
Miscellaneous income:
 
 
 
 
Allowance for equity funds used during construction
$
7

 
$
8

 
Interest income on industrial development revenue bonds
7

 
7

 
Interest and dividend income
2

 

 
Other
2

 

 
Total miscellaneous income
$
18

 
$
15

 
Miscellaneous expense:
 
 
 
 
Donations
$
5

 
$
4

 
Other
4

 
4

 
Total miscellaneous expense
$
9

 
$
8

 
Ameren Missouri:
 
 
 
 
Miscellaneous income:
 
 
 
 
Allowance for equity funds used during construction
$
7

 
$
7

 
Interest income on industrial development revenue bonds
7

 
7

 
Total miscellaneous income
$
14

 
$
14

 
Miscellaneous expense:
 
 
 
 
Donations
$
2

 
$
2

 
Other
2

 
3

 
Total miscellaneous expense
$
4

 
$
5

 
Ameren Illinois:
 
 
 
 
Miscellaneous income:
 
 
 
 
Allowance for equity funds used during construction
$

 
$
1

 
Interest and dividend income
2

 

 
Other
1

 

 
Total miscellaneous income
$
3

 
$
1

 
Miscellaneous expense:
 
 
 
 
Donations
$
3

 
$
3

 
Other
1

 

 
Total miscellaneous expense
$
4

 
$
3

 
(a)
Includes amounts for Ameren registrant and nonregistrant subsidiaries and intercompany eliminations.

NOTE 6 - DERIVATIVE FINANCIAL INSTRUMENTS
We use derivatives principally to manage the risk of changes in market prices for natural gas, diesel, power, and uranium. 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; and
actual cash outlays for the purchase of these commodities that differ from anticipated cash outlays.
 
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.


21



The following table presents open gross commodity contract volumes by commodity type for derivative assets and liabilities as of March 31, 2014, and December 31, 2013. As of March 31, 2014, these contracts ran through October 2016, October 2019, May 2032, and October 2016 for fuel oils, natural gas, power, and uranium, respectively.
  
Quantity (in millions, except as indicated)
 
2014
2013
Commodity
Ameren Missouri
Ameren Illinois
Ameren
Ameren Missouri
Ameren Illinois
Ameren
Fuel oils (in gallons)(a)
53

(b)

53

66

(b)

66

Natural gas (in mmbtu)
28

109

137

28

108

136

Power (in megawatthours)
2

11

13

3

11

14

Uranium (pounds in thousands)
827

(b)

827

796

(b)

796

(a)
Fuel oils consist of ultra-low-sulfur diesel, on-highway diesel, and crude oil.
(b)
Not applicable.
Authoritative accounting guidance regarding derivative instruments requires that all contracts considered to be derivative instruments be recorded on the balance sheet at their fair values, unless the NPNS exception applies. See Note 7 - Fair Value Measurements for a discussion of our methods of assessing the fair value of derivative instruments. 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.
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 if it qualifies for hedge accounting. We also consider whether gains or losses resulting from such derivatives 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 regulatory liabilities in the period in which the change occurs. Ameren
 
Missouri and Ameren Illinois believe derivative losses and gains deferred as regulatory assets and regulatory liabilities are probable of recovery or refund through future rates charged to customers. Regulatory assets and regulatory 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 March 31, 2014, and December 31, 2013, all contracts that qualify for hedge accounting received regulatory deferral.
Authoritative accounting guidance permits companies to offset fair value amounts recognized for the right to reclaim cash collateral (a receivable) or the obligation to return cash collateral (a liability) against fair value amounts recognized for derivative instruments that are executed with the same counterparty under the same master netting arrangement. The Ameren Companies did not elect to adopt this guidance for any eligible commodity contracts.


22



The following table presents the carrying value and balance sheet location of all derivative instruments as of March 31, 2014, and December 31, 2013:
 
Balance Sheet Location
 
Ameren Missouri
 
Ameren Illinois
 
Ameren
2014
 
 
 
 
 
 
Derivative assets not designated as hedging instruments(a)
 
 
 
 
 
 
Commodity contracts:
 
 
 
 
 
 
 
Fuel oils
Other current assets
 
$
5

 
$

 
$
5

 
Other assets
 
1

 

 
1

Natural gas
Other current assets
 
1

 
5

 
6

 
Other assets
 
1

 

 
1

Power
Other current assets
 
15

 

 
15

 
Total assets
 
$
23

 
$
5

 
$
28

Derivative liabilities not designated as hedging instruments(a)
 
 
 
 
 
 
Commodity contracts:
 
 
 
 
 
 
 
Fuel oils
Other current liabilities
 
$
2

 
$

 
$
2

 
Other deferred credits and liabilities
 
2

 

 
2

Natural gas
Other current liabilities
 
4

 
16

 
20

 
Other deferred credits and liabilities
 
4

 
13

 
17

Power
Other current liabilities
 
6

 
8

 
14

 
Other deferred credits and liabilities
 

 
112

 
112

Uranium
Other current liabilities
 
4

 

 
4

 
Other deferred credits and liabilities
 
1

 

 
1

 
Total liabilities
 
$
23

 
$
149

 
$
172

2013
 
 
 
 
 
 
Derivative assets not designated as hedging instruments(a)
 
 
 
 
 
 
Commodity contracts:
 
 
 
 
 
 
 
Fuel oils
Other current assets
 
$
6

 
$

 
$
6

 
Other assets
 
3

 

 
3

Natural gas
Other current assets
 
1

 
1

 
2

Power
Other current assets
 
23

 

 
23

 
Total assets
 
$
33

 
$
1

 
$
34

Derivative liabilities not designated as hedging instruments(a)
 
 
 
 
 
 
Commodity contracts:
 
 
 
 
 
 
 
Fuel oils
Other current liabilities
 
$
2

 
$

 
$
2

 
Other deferred credits and liabilities
 
1

 

 
1

Natural gas
Other current liabilities
 
5

 
27

 
32

 
Other deferred credits and liabilities
 
6

 
19

 
25

Power
Other current liabilities
 
4

 
9

 
13

 
Other deferred credits and liabilities
 

 
99

 
99

Uranium
Other current liabilities
 
5

 

 
5

 
Other deferred credits and liabilities
 
1

 

 
1

 
Total liabilities
 
$
24

 
$
154

 
$
178

(a)
Includes derivatives subject to regulatory deferral.

The following table presents the cumulative amount of pretax net gains (losses) on all derivative instruments deferred as regulatory assets or regulatory liabilities as of March 31, 2014, and December 31, 2013:
 
Ameren
Missouri
 
Ameren
Illinois
 
Ameren
2014
 
 
 
 
 
Cumulative gains (losses) deferred as regulatory liabilities or assets:
 
 
 
 
 
Fuel oils derivative contracts(a)
$

 
$

 
$

Natural gas derivative contracts(b)
(6
)
 
(24
)
 
(30
)
Power derivative contracts(c)
9

 
(120
)
 
(111
)
Uranium derivative contracts(d)
(5
)
 

 
(5
)
2013
 
 
 
 
 
Cumulative gains (losses) deferred as regulatory liabilities or assets:
 
 
 
 
 
Fuel oils derivative contracts
$
2

 
$

 
$
2

Natural gas derivative contracts
(10
)
 
(45
)
 
(55
)
Power derivative contracts
19

 
(108
)
 
(89
)
Uranium derivative contracts
(6
)
 

 
(6
)

23



(a)
Represents net gains (losses) on fuel oils derivative contracts at Ameren Missouri. These contracts are a partial hedge of Ameren Missouri’s transportation costs for coal through December 2016 as of March 31, 2014. Current gains deferred as regulatory liabilities include $2 million and $2 million at Ameren and Ameren Missouri, respectively, as of March 31, 2014. Current losses deferred as regulatory assets include $1 million and $1 million at Ameren and Ameren Missouri, respectively, as of March 31, 2014.
(b)
Represents net losses associated with natural gas derivative contracts. These contracts are a partial hedge of natural gas requirements through October 2019 a