SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- 27738; 70-10106)
Ameren Corporation, et al.
Supplemental Order Authorizing Additional Money Pool Participant; Release of Jurisdiction
October 20, 2003
Ameren Corporation ("Ameren"), St. Louis, Missouri, a registered public-utility holding company under the Public Utility Holding Company Act of 1935, as amended ("Act"), Union Electric Company, d/b/a AmerenUE ("AmerenUE"), an electric and gas utility company, Ameren Services Company ("Ameren Services"), a service company subsidiary, Ameren Energy, Inc., Ameren ERC, Inc., Ameren Energy Marketing Company, Ameren Energy Fuels and Services Company, and AFS Development Company, LLC, all of which are "energy-related companies" within the meaning of rule 58 under the Act, Ameren Development Company and Ameren Energy Resources Company, which are intermediate nonutility holding companies, Ameren Energy Development Company and Ameren Energy Generating Company, which are "exempt wholesale generators" within the meaning of section 32 of the Act ("EWGs"), Ameren Energy Communications, Inc., an "exempt telecommunications company" within the meaning of section 34 of the Act, Illinois Materials Supply Co., an "enterprise zone" company formed to purchase goods and equipment for Ameren's EWG subsidiaries, and Union Electric Development Company, a wholly owned non-utility subsidiary of AmerenUE that engages in various energy-related businesses and invests in affordable housing projects; Central Illinois Public Service Company d/b/a AmerenCIPS ("AmerenCIPS"), an electric and gas utility subsidiary of Ameren, and its wholly owned nonutility subsidiary, CIPSCO Investment Company, which invests in, among other things, affordable housing projects; CILCORP Inc. ("CILCORP"), an exempt holding company Peoria, Illinois; the following direct and indirect subsidiaries of CILCORP: Central Illinois Light Company ("CILCO"), an electric and gas utility company, AmerenEnergy Resources Generating Company ("AERG," formerly known as Central Illinois Generation, Inc.), an EWG formed by CILCO to acquire substantially all of CILCO's generating assets, CILCORP Investment Management, Inc., which, through subsidiaries manages CILCORP's investments in equipment leases, affordable housing projects and non-regulated independent power projects, CILCORP Ventures, Inc., which through its subsidiary, CILCORP Energy Services, Inc., provides energy-related services and products, QST Enterprises, Inc., which through subsidiaries provides energy and related services in non-regulated retail and wholesale markets, including utility operations and management services to industrial customers of CILCO, and CILCO's wholly owned non-utility subsidiaries, CILCO Exploration and Development Company and CILCO Energy Corporation, which are engaged in, respectively, exploration and development of gas and oil and other mineral resources and research and development activities relating to new sources of energy; and AmerenEnergy Medina Valley Cogen (No. 4), L.L.C. ("AmerenEnergy Medina Valley"), a limited liability company, its direct and indirect wholly owned nonutility subsidiaries, AmerenEnergy Medina Valley Cogen (No. 2), an intermediate nonutility subsidiary, and AmerenEnergy Medina Valley Cogen, L.L.C., an EWG, and AmerenEnergy Medina Valley Operations, L.L.C., which provides operating services to AES Medina Valley Cogen, L.L.C., ("Applicants" or "Ameren System") have filed a post-effective amendment ("Present Application") to a prior application/declaration ("Prior Application"), under sections 6(a), 7, 9(a)(1), 9(c)(3), 10, 12(b), and 12(f) of the Act and rules 40, 42, 43, 45 and 54 under the Act.
Applicants now request that the Commission issue a supplemental order releasing jurisdiction over AERG's proposal to participate in the Ameren System Non-State Regulated Subsidiary Money Pool, subject to certain additional proposed limitations.
Ameren directly owns all of the issued and outstanding common stock of Union Electric Company d/b/a AmerenUE ("AmerenUE") and Central Illinois Public Service Company d/b/a AmerenCIPS ("AmerenCIPS"), and indirectly through CILCORP Inc. ("CILCORP"), an exempt holding company, owns all of the issued and outstanding common stock of Central Illinois Light Company d/b/a AmerenCILCO ("AmerenCILCO").1 Together, AmerenUE, AmerenCIPS and AmerenCILCO provide retail and wholesale electric service to approximately 1.7 million customers and retail natural gas service to approximately 500,000 customers in parts of Missouri and Illinois.
AmerenCILCO owns all of the issued and outstanding common stock of AERG, which had previously been determined to be an EWG under section 32 of the Act. As explained in the CILCORP Order, AERG was formed by AmerenCILCO in November 2001 in order to facilitate the restructuring of AmerenCILCO in accordance with the Illinois Electric Service Customer Choice and Rate Relief Law of 1997. On October 3, 2003, AmerenCILCO transferred substantially all of its generating assets to AERG, and, in conjunction with that transfer, AERG relinquished its EWG status and as a result became an additional electric utility subsidiary of Ameren.
By order dated February 27, 2003 (Holding Co. Act Release No. 27655) ("Prior Order"), the Commission authorized Ameren and certain of its non-utility subsidiaries to, among other things, continue their participation in the Ameren System Non-Utility Money Pool (which has been renamed the "Non-State Regulated Subsidiary Money Pool") and, to the extent not exempt under Rules 45(b) and 52, to extend credit to each other through the Non-State Regulated Subsidiary Money Pool.2 The Commission reserved jurisdiction under the Prior Order over a proposal by AERG (then named Central Illinois Generation, Inc.) to become a participant in the Non-State Regulated Subsidiary Money Pool and to make short-term borrowings thereunder in an aggregate principal amount at any time outstanding not to exceed $250 million. AERG is now requesting that the Commission issue a supplemental order releasing jurisdiction over AERG's proposal to participate in the Non-State Regulated Subsidiary Money Pool, subject to certain additional proposed limitations.
Specifically, AERG states that (1) it will limit its contributions to the Non-State Regulated Subsidiary Money Pool to a maximum of $150 million at any time outstanding; and (2) any available funds of AERG may also be loaned to the Ameren System Utility Money Pool ("Utility Money Pool") in accordance with all terms and conditions of the Prior Order. AERG will not borrow any funds available under the Utility Money Pool. These proposed limitations are designed to limit AERG's credit exposure under the Non-State Regulated Subsidiary Money Pool, that is, the risk that funds contributed by AERG will not be repaid when needed.
Applicants state that the transactions proposed in the Application are also subject to rule 54 under the Act, which provides that in determining whether to approve the issue or sale of any securities for purposes other than the acquisition of an EWG or "foreign utility company" ("FUCO") or other transactions unrelated to EWGs or FUCOs, the Commission shall not consider the effect of the capitalization or earnings of subsidiaries of a registered holding company that are EWGs or FUCOs if the criteria ofule 53(a), (b) and (c) are satisfied. Under Rule 53(a), the Commission shall not make certain specified findings under Sections 7 and 12 in connection with a proposal by a holding company to issue securities for the purpose of acquiring the securities of or other interest in an EWG, or to guarantee the securities of an EWG, if each of the conditions in its paragraphs (a)(1) through (a)(4) are met, provided that none of the conditions specified in paragraphs (b)(1) through (b)(3) of rule 53 exists.
Applicants state that these standards are met. Ameren's "aggregate investment" (as defined in rule 53(a)(1)) in EWGs as of June 30, 2003 was $470,655,404, or approximately 26.5% of Ameren's "consolidated retained earnings" (also as defined in rule 53(a)(1)) for the four quarters ended June 30, 2003 ($1,773,093,901). Ameren does not currently hold an interest in any FUCO.
Applicants state that in accordance with rule 53(a)(2), Ameren will maintain books and records enabling it to identify investments in and earnings from each EWG and FUCO in which it directly or indirectly acquires and holds an interest. Ameren will cause each domestic EWG in which it acquires and holds an interest, and each foreign EWG and FUCO that is a majority-owned subsidiary, to maintain its books and records and prepare its financial statements in conformity with U.S. generally accepted accounting principles. All of those books and records and financial statements will be made available to the Commission, in English, upon request.
Applicants state that in accordance with rule 53(a)(3), no more than 2% of the employees of Ameren's domestic utility subsidiaries will, at any one time, directly or indirectly, render services to EWGs and FUCOs.
Applicants state that in accordance with rule 53(a)(4), Ameren will submit a copy of each application or declaration relating to investments in EWGs and FUCOs and copies of any related rule 24 certificates, as well as a copy of Ameren's Form U5S, to each of the public service commissions having jurisdiction over the retail rates of Ameren's domestic utility subsidiaries.
Applicants state that the provisions of Rule 53(a) are not made inapplicable to the requested authorization by reason of the occurrence or continuance of any of the circumstances specified in rule 53(b), and that rule 53(c) is inapplicable by its terms.
Applicants estimate the additional fees, commissions and expenses incurred or to be incurred not to exceed $1,000.
Fees and expenses in the estimated amount of not more than $1000 are expected to be incurred in connection with the preparation and filing of the present Application. Applicants state that no state or federal commission, other than this Commission, has jurisdiction over the proposed transactions.
On the basis of the facts in the record, it is found that the applicable standards of the Act and rules under the Act are satisfied, and no adverse findings are necessary.
IT IS ORDERED, under the applicable provisions of the Act and the rules under the Act, that the Application be, and hereby is, granted and permitted to become effective immediately, subject to the terms and conditions prescribed in rule 24 under the Act.
For the Commission, by the Division of Investment Management, pursuant to delegated authority.
Margaret H. McFarland
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