Goodwill, Impairment And Other Charges

12 Months Ended

Dec. 31, 2011

Goodwill, Impairment And Other Charges

NOTE 17 – GOODWILL, IMPAIRMENT AND OTHER CHARGES

The following table summarizes the pretax charges recognized for the years ended December 31, 2011, 2010, and 2009:

	Goodwill		Long-Lived Assets and  Related Charges		Emission Allowances		Total
2011:
Ameren(a)	$	—	$	123	$	2	$	125
Ameren Missouri		—		89		—		89
Genco		—		34		1		35
2010:
Ameren(a)		420		101		68		589
Genco		65		64		41		170
2009:
Ameren(a)		—		7		—		7
Genco		—		6		—		6

(a) Includes amounts for registrant and nonregistrant subsidiaries.

Each of the above charges was recorded in the statement of income as "Goodwill, impairment and other charges," with the exception of the Ameren Missouri statement of income where it was recorded as "Loss from regulatory disallowance." Each of the charges is discussed below.

The goodwill and other asset impairment charges did not result in a violation of any Ameren or Ameren subsidiary debt covenants or counterparty agreements. The charges are not expected to have a material impact on future operations.

Goodwill

Ameren has three reporting units, which also represent Ameren's reportable segments. The Ameren reporting units are Ameren Missouri, Ameren Illinois, and Merchant Generation. Genco has one reporting unit, Merchant Generation. Ameren Illinois has one reporting unit, Ameren Illinois. Ameren's reporting units have been defined and goodwill has been evaluated at the operating segment level in accordance with authoritative accounting guidance. Our reporting units represent businesses for which discrete financial information is available and reviewed regularly by management.

We evaluate goodwill for impairment as of October 31 of each year, or more frequently if events and circumstances indicate that the asset might be impaired. In 2011, FASB amended its guidance to simplify the testing of goodwill for impairment. The amended guidance provides an option to perform a qualitative assessment to determine whether further impairment testing is necessary. If the qualitative evaluation yields support that it is more likely than not that the fair value of a reporting unit exceeds its carrying value, the quantitative impairment test is not required. Ameren and Ameren Illinois adopted the qualitative goodwill evaluation model for its annual goodwill impairment test conducted as of October 31, 2011. Based on the results of Ameren's and Ameren Illinois' qualitative assessment, Ameren and Ameren Illinois believe it was more likely than not that the fair value of each of their reporting units exceeded their carrying values as of October 31, 2011, indicating no impairment of Ameren's and Ameren Illinois' goodwill. The following factors, not meant to be all-inclusive, were considered by Ameren and Ameren Illinois when assessing whether it was more likely than not that the fair value of the Ameren Illinois reporting unit exceeded its carrying value for the October 31, 2011 test:

• Macroeconomic conditions, including those conditions within Ameren Illinois' service territory;

• Pending rate case outcomes and future rate case outcomes;

• Changes in laws and potential law changes, such as the IEIMA;

• Observable industry market multiples; and

• Actual and forecasted financial performance.

During 2010, Ameren recorded a noncash impairment charge of $420 million, which represented all of the goodwill assigned to Ameren's Merchant Generation reporting unit. Genco recorded a noncash impairment charge of $65 million, which represented all the goodwill assigned to Genco's Merchant Generation reporting unit. The impairments recorded in 2010 in the Merchant Generation segment were caused by a sustained decline in market prices for electricity, industry market multiples becoming observable at lower levels than previously estimated, and potentially more stringent environmental regulations being enacted.

Ameren and Ameren Illinois will continue to monitor the actual and forecasted operating results, cash flows, market capitalization, and observable industry market multiples of their reporting units for signs of possible declines in estimated fair value and potential goodwill impairment.

The following tables provide a reconciliation of the beginning and ending carrying amounts of goodwill by reporting unit, for Ameren, Ameren Illinois and Genco for the years ended December 31, 2011 and 2010:

Ameren

	2011		2010
	Ameren Illinois		Ameren Illinois		Merchant Generation		Total(a)
Gross goodwill at January 1	$	411	$	411	$	420	$	831
Accumulated impairment losses		—		—		—		—
Goodwill, net of accumulated impairment losses	$	411	$	411	$	420	$	831
Impairment losses during year		—		—		420		420
Goodwill, net of impairment losses at December 31	$	411	$	411	$	—	$	411

(a) Includes amounts for Ameren registrants and nonregistrant subsidiaries.

Ameren Illinois

	2011		2010
	Ameren Illinois		Ameren Illinois
Gross goodwill at January 1	$	411	$	411
Accumulated impairment losses		—		—
Goodwill, net of accumulated impairment losses	$	411	$	411
Impairment losses during the year		—		—
Goodwill, net of impairment losses at December 31	$	411	$	411

Genco

	2010
	Merchant Generation
Gross goodwill at January 1	$	65
Accumulated impairment losses		—
Goodwill, net of accumulated impairment losses	$	65
Impairment losses during the year		65
Goodwill, net of impairment losses at December 31	$	—

Long-lived Assets

We evaluate long-lived assets classified as held and used for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Whether impairment has occurred is determined by comparing the estimated undiscounted cash flows attributable to the assets with the carrying value of the assets. If the carrying value exceeds the undiscounted cash flows, we recognize an impairment charge equal to the carrying value of the assets in excess of estimated fair value.

During 2011, the MoPSC issued an electric rate order that disallowed the recovery of all costs of enhancements, or costs that would have been incurred absent the breach, related to the rebuilding of the Taum Sauk energy center in excess of the amount recovered from property insurance. Consequently, Ameren and Ameren Missouri each reported a pretax charge to earnings of $89 million. See Note 2 – Rate and Regulatory Matters for additional information.

At the end of 2011, Genco ceased operations of its Meredosia and Hutsonville energy centers. The closure of these energy centers resulted in the elimination of 90 positions. Ameren and Genco each recorded the following pretax charges to earnings during 2011 related to the closure of these energy centers:

• a $26 million noncash impairment, representing the remaining net investment in both energy centers;

• a $4 million noncash impairment of materials and supplies; and

• a $4 million estimate for future cash severance costs, which will be substantially paid during the first quarter of 2012.

The closure of these energy centers is primarily the result of the expected cost of complying with the CSAPR and the MATS. Genco determined that environmental compliance options for these four units were uneconomical. Another factor driving the closure of these energy centers was a lack of a multiyear capacity market managed by MISO, without which Genco was not positioned to make the substantial investment for environmental controls that would be required to keep these units in service. Ameren and Genco expect to receive cash tax benefits of $22 million and $33 million, respectively, as a result of the closure of these energy centers. Previously recorded AROs for ash pond closures, river structure, and asbestos removals at these energy centers were $38 million. Ameren and Genco expect cash expenditures over the next 10 years along with associated cash tax benefits of $16 million.

During 2010, Ameren and Genco evaluated their long-lived assets and recorded noncash pretax asset impairment charges of $101 million and $64 million, respectively, to reduce the carrying value of the Meredosia and Medina Valley energy centers to their estimated fair value during 2010.

In 2009, Genco recorded asset impairment charges of $6 million as a result of the termination of a rail line extension project at a Genco subsidiary and an adjustment of the carrying value of an office building owned by Genco to its estimated fair value as of December 31, 2009. The charge related to the office building was based on the net proceeds from its sale in 2010. In addition, AERG recorded an asset impairment charge of $1 million to adjust the carrying value of its Indian Trails generation facility's estimated fair value as of December 31, 2009. This charge was based on the net proceeds from the sale of the facility in January 2010.

Intangible Assets

We evaluate emission allowances for impairment if events or changes in circumstances indicate that they will not or cannot be used in operations.

Prior to 2010, Ameren, Ameren Missouri and Genco expected to use their SO₂ emission allowances for ongoing operations. In July 2010, the EPA issued the proposed CSAPR, which would restrict the use of existing SO₂ emission allowances. As a result, Ameren, Ameren Missouri and Genco no longer expected all of their SO₂ emission allowances would be used in operations. Therefore, during 2010, Ameren, Ameren Missouri and Genco recorded an impairment charge to reduce the carrying value of their SO₂ emission allowances to their estimated fair value. Ameren's and Genco's noncash pretax impairment charge was $68 million and $41 million, respectively. Ameren Missouri recorded a $23 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to SO₂ emission allowances. Therefore, the Ameren Missouri SO₂ emission allowance impairment had no impact on earnings. The fair value of the SO₂ emission allowances was based on observable and unobservable inputs.

In July 2011, the EPA issued CSAPR, which created new allowances for SO₂ and NO_x emissions, and restricted the use of pre-existing SO₂ and NO_x allowances to the acid rain program and to the NO_x budget trading program, respectively. As a result, observable market prices for existing emission allowances declined materially. Consequently, during 2011, Ameren and Genco recorded a noncash pretax impairment charge of $2 million and $1 million, respectively. Ameren Missouri recorded a $1 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to the SO₂ emission allowances, which had no impact on earnings.

Ameren Illinois Company [Member]

Goodwill, Impairment And Other Charges

NOTE 17 – GOODWILL, IMPAIRMENT AND OTHER CHARGES

The following table summarizes the pretax charges recognized for the years ended December 31, 2011, 2010, and 2009:

	Goodwill		Long-Lived Assets and  Related Charges		Emission Allowances		Total
2011:
Ameren(a)	$	—	$	123	$	2	$	125
Ameren Missouri		—		89		—		89
Genco		—		34		1		35
2010:
Ameren(a)		420		101		68		589
Genco		65		64		41		170
2009:
Ameren(a)		—		7		—		7
Genco		—		6		—		6

(a) Includes amounts for registrant and nonregistrant subsidiaries.

Each of the above charges was recorded in the statement of income as "Goodwill, impairment and other charges," with the exception of the Ameren Missouri statement of income where it was recorded as "Loss from regulatory disallowance." Each of the charges is discussed below.

The goodwill and other asset impairment charges did not result in a violation of any Ameren or Ameren subsidiary debt covenants or counterparty agreements. The charges are not expected to have a material impact on future operations.

Goodwill

Ameren has three reporting units, which also represent Ameren's reportable segments. The Ameren reporting units are Ameren Missouri, Ameren Illinois, and Merchant Generation. Genco has one reporting unit, Merchant Generation. Ameren Illinois has one reporting unit, Ameren Illinois. Ameren's reporting units have been defined and goodwill has been evaluated at the operating segment level in accordance with authoritative accounting guidance. Our reporting units represent businesses for which discrete financial information is available and reviewed regularly by management.

We evaluate goodwill for impairment as of October 31 of each year, or more frequently if events and circumstances indicate that the asset might be impaired. In 2011, FASB amended its guidance to simplify the testing of goodwill for impairment. The amended guidance provides an option to perform a qualitative assessment to determine whether further impairment testing is necessary. If the qualitative evaluation yields support that it is more likely than not that the fair value of a reporting unit exceeds its carrying value, the quantitative impairment test is not required. Ameren and Ameren Illinois adopted the qualitative goodwill evaluation model for its annual goodwill impairment test conducted as of October 31, 2011. Based on the results of Ameren's and Ameren Illinois' qualitative assessment, Ameren and Ameren Illinois believe it was more likely than not that the fair value of each of their reporting units exceeded their carrying values as of October 31, 2011, indicating no impairment of Ameren's and Ameren Illinois' goodwill. The following factors, not meant to be all-inclusive, were considered by Ameren and Ameren Illinois when assessing whether it was more likely than not that the fair value of the Ameren Illinois reporting unit exceeded its carrying value for the October 31, 2011 test:

• Macroeconomic conditions, including those conditions within Ameren Illinois' service territory;

• Pending rate case outcomes and future rate case outcomes;

• Changes in laws and potential law changes, such as the IEIMA;

• Observable industry market multiples; and

• Actual and forecasted financial performance.

During 2010, Ameren recorded a noncash impairment charge of $420 million, which represented all of the goodwill assigned to Ameren's Merchant Generation reporting unit. Genco recorded a noncash impairment charge of $65 million, which represented all the goodwill assigned to Genco's Merchant Generation reporting unit. The impairments recorded in 2010 in the Merchant Generation segment were caused by a sustained decline in market prices for electricity, industry market multiples becoming observable at lower levels than previously estimated, and potentially more stringent environmental regulations being enacted.

Ameren and Ameren Illinois will continue to monitor the actual and forecasted operating results, cash flows, market capitalization, and observable industry market multiples of their reporting units for signs of possible declines in estimated fair value and potential goodwill impairment.

The following tables provide a reconciliation of the beginning and ending carrying amounts of goodwill by reporting unit, for Ameren, Ameren Illinois and Genco for the years ended December 31, 2011 and 2010:

Ameren

	2011		2010
	Ameren Illinois		Ameren Illinois		Merchant Generation		Total(a)
Gross goodwill at January 1	$	411	$	411	$	420	$	831
Accumulated impairment losses		—		—		—		—
Goodwill, net of accumulated impairment losses	$	411	$	411	$	420	$	831
Impairment losses during year		—		—		420		420
Goodwill, net of impairment losses at December 31	$	411	$	411	$	—	$	411

(a) Includes amounts for Ameren registrants and nonregistrant subsidiaries.

Ameren Illinois

	2011		2010
	Ameren Illinois		Ameren Illinois
Gross goodwill at January 1	$	411	$	411
Accumulated impairment losses		—		—
Goodwill, net of accumulated impairment losses	$	411	$	411
Impairment losses during the year		—		—
Goodwill, net of impairment losses at December 31	$	411	$	411

Genco

	2010
	Merchant Generation
Gross goodwill at January 1	$	65
Accumulated impairment losses		—
Goodwill, net of accumulated impairment losses	$	65
Impairment losses during the year		65
Goodwill, net of impairment losses at December 31	$	—

Long-lived Assets

We evaluate long-lived assets classified as held and used for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Whether impairment has occurred is determined by comparing the estimated undiscounted cash flows attributable to the assets with the carrying value of the assets. If the carrying value exceeds the undiscounted cash flows, we recognize an impairment charge equal to the carrying value of the assets in excess of estimated fair value.

During 2011, the MoPSC issued an electric rate order that disallowed the recovery of all costs of enhancements, or costs that would have been incurred absent the breach, related to the rebuilding of the Taum Sauk energy center in excess of the amount recovered from property insurance. Consequently, Ameren and Ameren Missouri each reported a pretax charge to earnings of $89 million. See Note 2 – Rate and Regulatory Matters for additional information.

At the end of 2011, Genco ceased operations of its Meredosia and Hutsonville energy centers. The closure of these energy centers resulted in the elimination of 90 positions. Ameren and Genco each recorded the following pretax charges to earnings during 2011 related to the closure of these energy centers:

• a $26 million noncash impairment, representing the remaining net investment in both energy centers;

• a $4 million noncash impairment of materials and supplies; and

• a $4 million estimate for future cash severance costs, which will be substantially paid during the first quarter of 2012.

The closure of these energy centers is primarily the result of the expected cost of complying with the CSAPR and the MATS. Genco determined that environmental compliance options for these four units were uneconomical. Another factor driving the closure of these energy centers was a lack of a multiyear capacity market managed by MISO, without which Genco was not positioned to make the substantial investment for environmental controls that would be required to keep these units in service. Ameren and Genco expect to receive cash tax benefits of $22 million and $33 million, respectively, as a result of the closure of these energy centers. Previously recorded AROs for ash pond closures, river structure, and asbestos removals at these energy centers were $38 million. Ameren and Genco expect cash expenditures over the next 10 years along with associated cash tax benefits of $16 million.

During 2010, Ameren and Genco evaluated their long-lived assets and recorded noncash pretax asset impairment charges of $101 million and $64 million, respectively, to reduce the carrying value of the Meredosia and Medina Valley energy centers to their estimated fair value during 2010.

In 2009, Genco recorded asset impairment charges of $6 million as a result of the termination of a rail line extension project at a Genco subsidiary and an adjustment of the carrying value of an office building owned by Genco to its estimated fair value as of December 31, 2009. The charge related to the office building was based on the net proceeds from its sale in 2010. In addition, AERG recorded an asset impairment charge of $1 million to adjust the carrying value of its Indian Trails generation facility's estimated fair value as of December 31, 2009. This charge was based on the net proceeds from the sale of the facility in January 2010.

Intangible Assets

We evaluate emission allowances for impairment if events or changes in circumstances indicate that they will not or cannot be used in operations.

Prior to 2010, Ameren, Ameren Missouri and Genco expected to use their SO₂ emission allowances for ongoing operations. In July 2010, the EPA issued the proposed CSAPR, which would restrict the use of existing SO₂ emission allowances. As a result, Ameren, Ameren Missouri and Genco no longer expected all of their SO₂ emission allowances would be used in operations. Therefore, during 2010, Ameren, Ameren Missouri and Genco recorded an impairment charge to reduce the carrying value of their SO₂ emission allowances to their estimated fair value. Ameren's and Genco's noncash pretax impairment charge was $68 million and $41 million, respectively. Ameren Missouri recorded a $23 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to SO₂ emission allowances. Therefore, the Ameren Missouri SO₂ emission allowance impairment had no impact on earnings. The fair value of the SO₂ emission allowances was based on observable and unobservable inputs.

In July 2011, the EPA issued CSAPR, which created new allowances for SO₂ and NO_x emissions, and restricted the use of pre-existing SO₂ and NO_x allowances to the acid rain program and to the NO_x budget trading program, respectively. As a result, observable market prices for existing emission allowances declined materially. Consequently, during 2011, Ameren and Genco recorded a noncash pretax impairment charge of $2 million and $1 million, respectively. Ameren Missouri recorded a $1 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to the SO₂ emission allowances, which had no impact on earnings.

Ameren Energy Generating Company [Member]

Goodwill, Impairment And Other Charges

NOTE 17 – GOODWILL, IMPAIRMENT AND OTHER CHARGES

The following table summarizes the pretax charges recognized for the years ended December 31, 2011, 2010, and 2009:

	Goodwill		Long-Lived Assets and  Related Charges		Emission Allowances		Total
2011:
Ameren(a)	$	—	$	123	$	2	$	125
Ameren Missouri		—		89		—		89
Genco		—		34		1		35
2010:
Ameren(a)		420		101		68		589
Genco		65		64		41		170
2009:
Ameren(a)		—		7		—		7
Genco		—		6		—		6

(a) Includes amounts for registrant and nonregistrant subsidiaries.

Each of the above charges was recorded in the statement of income as "Goodwill, impairment and other charges," with the exception of the Ameren Missouri statement of income where it was recorded as "Loss from regulatory disallowance." Each of the charges is discussed below.

The goodwill and other asset impairment charges did not result in a violation of any Ameren or Ameren subsidiary debt covenants or counterparty agreements. The charges are not expected to have a material impact on future operations.

Goodwill

Ameren has three reporting units, which also represent Ameren's reportable segments. The Ameren reporting units are Ameren Missouri, Ameren Illinois, and Merchant Generation. Genco has one reporting unit, Merchant Generation. Ameren Illinois has one reporting unit, Ameren Illinois. Ameren's reporting units have been defined and goodwill has been evaluated at the operating segment level in accordance with authoritative accounting guidance. Our reporting units represent businesses for which discrete financial information is available and reviewed regularly by management.

We evaluate goodwill for impairment as of October 31 of each year, or more frequently if events and circumstances indicate that the asset might be impaired. In 2011, FASB amended its guidance to simplify the testing of goodwill for impairment. The amended guidance provides an option to perform a qualitative assessment to determine whether further impairment testing is necessary. If the qualitative evaluation yields support that it is more likely than not that the fair value of a reporting unit exceeds its carrying value, the quantitative impairment test is not required. Ameren and Ameren Illinois adopted the qualitative goodwill evaluation model for its annual goodwill impairment test conducted as of October 31, 2011. Based on the results of Ameren's and Ameren Illinois' qualitative assessment, Ameren and Ameren Illinois believe it was more likely than not that the fair value of each of their reporting units exceeded their carrying values as of October 31, 2011, indicating no impairment of Ameren's and Ameren Illinois' goodwill. The following factors, not meant to be all-inclusive, were considered by Ameren and Ameren Illinois when assessing whether it was more likely than not that the fair value of the Ameren Illinois reporting unit exceeded its carrying value for the October 31, 2011 test:

• Macroeconomic conditions, including those conditions within Ameren Illinois' service territory;

• Pending rate case outcomes and future rate case outcomes;

• Changes in laws and potential law changes, such as the IEIMA;

• Observable industry market multiples; and

• Actual and forecasted financial performance.

During 2010, Ameren recorded a noncash impairment charge of $420 million, which represented all of the goodwill assigned to Ameren's Merchant Generation reporting unit. Genco recorded a noncash impairment charge of $65 million, which represented all the goodwill assigned to Genco's Merchant Generation reporting unit. The impairments recorded in 2010 in the Merchant Generation segment were caused by a sustained decline in market prices for electricity, industry market multiples becoming observable at lower levels than previously estimated, and potentially more stringent environmental regulations being enacted.

Ameren and Ameren Illinois will continue to monitor the actual and forecasted operating results, cash flows, market capitalization, and observable industry market multiples of their reporting units for signs of possible declines in estimated fair value and potential goodwill impairment.

The following tables provide a reconciliation of the beginning and ending carrying amounts of goodwill by reporting unit, for Ameren, Ameren Illinois and Genco for the years ended December 31, 2011 and 2010:

Ameren

	2011		2010
	Ameren Illinois		Ameren Illinois		Merchant Generation		Total(a)
Gross goodwill at January 1	$	411	$	411	$	420	$	831
Accumulated impairment losses		—		—		—		—
Goodwill, net of accumulated impairment losses	$	411	$	411	$	420	$	831
Impairment losses during year		—		—		420		420
Goodwill, net of impairment losses at December 31	$	411	$	411	$	—	$	411

(a) Includes amounts for Ameren registrants and nonregistrant subsidiaries.

Ameren Illinois

	2011		2010
	Ameren Illinois		Ameren Illinois
Gross goodwill at January 1	$	411	$	411
Accumulated impairment losses		—		—
Goodwill, net of accumulated impairment losses	$	411	$	411
Impairment losses during the year		—		—
Goodwill, net of impairment losses at December 31	$	411	$	411

Genco

	2010
	Merchant Generation
Gross goodwill at January 1	$	65
Accumulated impairment losses		—
Goodwill, net of accumulated impairment losses	$	65
Impairment losses during the year		65
Goodwill, net of impairment losses at December 31	$	—

Long-lived Assets

We evaluate long-lived assets classified as held and used for impairment when events or changes in circumstances indicate that the carrying value of such assets may not be recoverable. Whether impairment has occurred is determined by comparing the estimated undiscounted cash flows attributable to the assets with the carrying value of the assets. If the carrying value exceeds the undiscounted cash flows, we recognize an impairment charge equal to the carrying value of the assets in excess of estimated fair value.

During 2011, the MoPSC issued an electric rate order that disallowed the recovery of all costs of enhancements, or costs that would have been incurred absent the breach, related to the rebuilding of the Taum Sauk energy center in excess of the amount recovered from property insurance. Consequently, Ameren and Ameren Missouri each reported a pretax charge to earnings of $89 million. See Note 2 – Rate and Regulatory Matters for additional information.

At the end of 2011, Genco ceased operations of its Meredosia and Hutsonville energy centers. The closure of these energy centers resulted in the elimination of 90 positions. Ameren and Genco each recorded the following pretax charges to earnings during 2011 related to the closure of these energy centers:

• a $26 million noncash impairment, representing the remaining net investment in both energy centers;

• a $4 million noncash impairment of materials and supplies; and

• a $4 million estimate for future cash severance costs, which will be substantially paid during the first quarter of 2012.

The closure of these energy centers is primarily the result of the expected cost of complying with the CSAPR and the MATS. Genco determined that environmental compliance options for these four units were uneconomical. Another factor driving the closure of these energy centers was a lack of a multiyear capacity market managed by MISO, without which Genco was not positioned to make the substantial investment for environmental controls that would be required to keep these units in service. Ameren and Genco expect to receive cash tax benefits of $22 million and $33 million, respectively, as a result of the closure of these energy centers. Previously recorded AROs for ash pond closures, river structure, and asbestos removals at these energy centers were $38 million. Ameren and Genco expect cash expenditures over the next 10 years along with associated cash tax benefits of $16 million.

During 2010, Ameren and Genco evaluated their long-lived assets and recorded noncash pretax asset impairment charges of $101 million and $64 million, respectively, to reduce the carrying value of the Meredosia and Medina Valley energy centers to their estimated fair value during 2010.

In 2009, Genco recorded asset impairment charges of $6 million as a result of the termination of a rail line extension project at a Genco subsidiary and an adjustment of the carrying value of an office building owned by Genco to its estimated fair value as of December 31, 2009. The charge related to the office building was based on the net proceeds from its sale in 2010. In addition, AERG recorded an asset impairment charge of $1 million to adjust the carrying value of its Indian Trails generation facility's estimated fair value as of December 31, 2009. This charge was based on the net proceeds from the sale of the facility in January 2010.

Intangible Assets

We evaluate emission allowances for impairment if events or changes in circumstances indicate that they will not or cannot be used in operations.

Prior to 2010, Ameren, Ameren Missouri and Genco expected to use their SO₂ emission allowances for ongoing operations. In July 2010, the EPA issued the proposed CSAPR, which would restrict the use of existing SO₂ emission allowances. As a result, Ameren, Ameren Missouri and Genco no longer expected all of their SO₂ emission allowances would be used in operations. Therefore, during 2010, Ameren, Ameren Missouri and Genco recorded an impairment charge to reduce the carrying value of their SO₂ emission allowances to their estimated fair value. Ameren's and Genco's noncash pretax impairment charge was $68 million and $41 million, respectively. Ameren Missouri recorded a $23 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to SO₂ emission allowances. Therefore, the Ameren Missouri SO₂ emission allowance impairment had no impact on earnings. The fair value of the SO₂ emission allowances was based on observable and unobservable inputs.

In July 2011, the EPA issued CSAPR, which created new allowances for SO₂ and NO_x emissions, and restricted the use of pre-existing SO₂ and NO_x allowances to the acid rain program and to the NO_x budget trading program, respectively. As a result, observable market prices for existing emission allowances declined materially. Consequently, during 2011, Ameren and Genco recorded a noncash pretax impairment charge of $2 million and $1 million, respectively. Ameren Missouri recorded a $1 million impairment of its SO₂ emission allowances by reducing a previously established regulatory liability relating to the SO₂ emission allowances, which had no impact on earnings.