Federal Energy Regulatory Commission Approval Will Help Ameren Transmission Company of Illinois Bolster Infrastructure, Improve Reliability, Create Jobs
By: Ameren Corporation |
Ameren Transmission Company of Illinois (ATXI), a wholly owned subsidiary of Ameren Corporation (NYSE: AEE), received important regulatory approval from the Federal Energy Regulatory Commission (FERC) to continue to move its Spoon River and Mark Twain transmission construction projects forward. FERC approved similar regulatory treatment for the Illinois Rivers transmission project in May 2011.
The three projects are part of the $1.3 billion multi-value projects approved by the Midwest Independent Transmission System Operator Inc. (MISO) board in December 2011. MISO is a regional transmission organization serving an 11-state region, including the service territories of the Ameren utilities, and the Canadian province of Manitoba.
“We are very pleased with FERC’s approvals of the incentive regulatory treatment,” said Maureen Borkowski, president and CEO of ATXI. “This approval paves the way for important new investment by Ameren Transmission Company of Illinois to deliver renewable energy in the Midwest, promote electric power reliability, lower costs for consumers by reducing transmission congestion and create jobs which are important to the economy.”
FERC’s approved regulatory treatment includes enhanced cost-recovery mechanisms and protections for Ameren Transmission Company of Illinois that support the investments and facilitate the cost-effective financing of the projects.
“Growth in our transmission business is a key part of our corporate strategy. This FERC approval is an important milestone in implementing this strategy,” said Thomas R. Voss, chairman, president and CEO of Ameren Corporation.
ATXI Project Facts
The Spoon River project in Illinois, preliminarily estimated to cost $208 million, will span approximately 70 miles of new 345-kilovolt transmission line from Oak Grove to Galesburg, Ill., continuing near Peoria, Ill.
The Mark Twain project in Missouri, preliminarily estimated to cost $155 million, will span approximately 90 miles in Missouri of new 345-kilovolt transmission line from the Iowa border to Adair, Mo., on to Palmyra, Mo.
The Illinois Rivers project, preliminarily estimated to cost $1 billion, will span approximately 400 miles with a new 345-kilovolt transmission line, crossing the Mississippi River near Quincy, Ill., continuing east across Illinois to the Indiana border. ATXI has filed a petition with the Illinois Commerce Commission (ICC) for a certificate to build the Illinois Rivers project. ATXI expects the ICC to issue a decision by mid-2013.
The recent FERC order also approved forward-looking formula rates for Ameren Illinois Company’s transmission facilities. The primary benefit of a forward-looking formula rate is to provide timely cash flows in order to be able to efficiently finance investments.
Statements in this release 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 Ameren’s Form 10-K for the year ended December 31, 2011, and in the Form 10-Q for the quarter ended September 30, 2012, and elsewhere in this release and in our other filings with the Securities and Exchange Commission, 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 recovery mechanisms and ratemaking determinations;
- changes in laws and other governmental actions, including monetary, fiscal, and tax policies;
- the effects of increased competition in the future due to, among other things, deregulation of certain aspects of our business at both the state and federal levels, and the implementation of deregulation;
- increasing capital expenditure and operating expense requirements and our ability to recover these costs;
- the level and volatility of future prices for power in the Midwest;
- the development of a multi-year capacity market within MISO and the outcomes of MISO’s inaugural annual capacity auction in 2013;
- 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 our credit metrics, or other events that make our access to necessary capital, including short-term credit and liquidity, impossible, more difficult, or more costly;
- our assessment of our liquidity;
- transmission 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 effects of strategic initiatives, including mergers, acquisitions and divestitures, and any related tax implications;
- 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 and affiliates to meet their obligations with respect to contracts, credit facilities, and financial instruments;
- legal and administrative proceedings; and
- acts of sabotage, war, terrorism, cybersecurity 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.