Back to Media Room

News Releases

AmerenUE Files for Increase in Natural Gas Delivery Rates to Cover Infrastructure Investments and Higher Operating Costs

ST. LOUIS, June 11 /PRNewswire-FirstCall/ -- Citing infrastructure investments in its natural gas system and higher operating costs since the last natural gas rate case three years ago, AmerenUE, an operating company of Ameren Corporation (NYSE: AEE), today filed a request with the Missouri Public Service Commission (PSC) for an $11.9 million increase in natural gas delivery rates for its 127,000 Missouri gas customers.

Delivery rates represent the portion of a customer's total gas bill that goes primarily to cover the costs of construction, operations and maintenance of UE's distribution system that delivers gas to customers. For residential customers, those charges historically account for about one-third of their total gas bill. The remainder of their bill is covered by the Purchased Gas Adjustment (PGA), which reflects the wholesale cost of gas from UE's suppliers, plus the cost of transporting it to the UE system. Revenue collected through the PGA goes entirely to UE's suppliers and pipeline companies, and is not affected by today's filing.

For residential customers, UE's request would mean an average net increase of about $7.25 per month, or approximately 9.8 percent, in their total gas bill, excluding taxes.

UE's rate request will not have any immediate effect, since it must first go through the process of PSC review and hearings. A decision is expected no later than May 2011.

"Since our last rate case in 2007, we have invested $54 million in gas system improvements, including the addition of more than 175 miles of new gas distribution mains and about 9,800 new service lines to homes and businesses," says Warner Baxter, AmerenUE president and chief executive officer. "While we recognize that a rate increase may create challenges for some of our customers during this difficult economic period, we believe it is necessary to update our natural gas rates to reflect our additional investments and our increased operating costs since our last gas rate case so that we can continue to invest in our gas infrastructure and provide safe and reliable service to our customers."

UE's delivery rates are regulated, and any changes must be approved by the PSC through a rate case like the one filed today. In contrast, supplier costs for natural gas are not regulated, and go up or down based on supply and demand. UE passes those costs on to customers through the PGA without "markup." The PSC reviews PGA costs for prudence and accuracy, but changes do not require the filing of a formal rate case.

AmerenUE, founded in 1902, provides electric and gas service to approximately 1.2 million customers across central and eastern Missouri, including the greater St. Louis area. UE serves 57 Missouri counties and 500 towns. For more information, visit www.amerenue.com.


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 our 2009 Annual Report on Form 10-K 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 or legislative actions, including changes in regulatory policies and ratemaking determinations and future rate proceedings or legislative actions that seek to limit or reverse rate increases;
  • changes in laws and other governmental actions, including monetary and fiscal 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;
  • the effects on demand for our services resulting from technological advances;
  • increasing capital expenditure and operating expense requirements and our ability to recover these costs in a timely fashion in light of regulatory lag;
  • 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 the 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 or other events that 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;
  • impairments of long-lived assets or goodwill;
  • the effects of strategic initiatives, including mergers, acquisitions and divestitures;
  • the impact of current environmental regulations on utilities and the expectation that more stringent requirements, including those related to greenhouse gases and energy efficiency, will be enacted over time, which could limit, or terminate, the operation of certain of our generating units, increase our costs, reduce our customers' demand for natural gas, or otherwise have a negative financial effect;
  • labor disputes, work force 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, 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.

SOURCE AmerenUE; Ameren Corporation