Ameren Corporation · NYSE:AEE
Ameren — Evercore ISI Virtual Utility Conference 2022
42 slides from Ameren's conference presentation, Jan 12, 2022
Slide 1: Leading the Way to a Sustainable Energy Future
Leading the Way to a Sustainable Energy Future Evercore ISI Virtual Utility Conference Jan. 12-13, 2022
Slide 2: Cautionary Statements
Cautionary Statements Use of Non-GAAP Financial Measures In this presentation, Ameren has presented weather-normalized and core earnings per share, which are non-GAAP financial measures and may not be comparable to those of other companies. A reconciliation of GAAP to non-GAAP information is include
Slide 3: Company Description
Company Description Fully rate-regulated electric and natural gas utility Ameren Businesses 2.4M electric Ameren Missouri customers • Electric transmission, distribution, and generation business and a natural gas distribution business in Missouri regulated by MoPSC 0.9M gas • Serves 1.2 million elec
Slide 4: Our Value Proposition for Customers, Shareholders and the Environment
Our Value Proposition for Customers, Shareholders and the Environment Attractive dividend Strong long-term and strong long-term dividend Attractive total growth outlook growth outlook return potential • Expect 6% to 8% EPS CAGR 2021-20251,2 • Annualized equivalent dividend rate of • Track record of
Slide 5: Our Sustainability Value Proposition
Our Sustainability Value Proposition ENVIRONMENTAL STEWARDSHIP SOCIAL IMPACT • Accelerating transition to a cleaner and more diverse portfolio1 • Delivering value to customers in 2020 while focused on safety ‒ Target carbon reductions from 2005 levels: 50% by 2030; 85% by ‒ Improved reliability: 13%
Slide 6: Delivering Strong Value to our Customers
Delivering Strong Value to our Customers Increased Customer Outage Improved Reliability1 Affordable Rates2 Frequency Satisfaction3 JD Power (per customer per year) +13% ¢/KWh Score +22% 1.00 Better 15 Better 766 750 0.80 0.89 13.15 13.14 734 731 723 0.77 700 0.60 10 10.11 690 9.93 650 663 0.40 651 5
Slide 7: Strong Track Record of EPS and Dividend Growth
Strong Track Record of EPS and Dividend Growth Weather-Normalized Core Weather-Normalized Dividends Paid per Share3 Earnings per Diluted Share1 Dividend Payout Ratio $3.85 $2.20 +70% or ~+38% $2.20 $3.81 $3.60 ~8% CAGR 2013 to 2021 80% $3.54 $3.35 $2.00 2013 to 2020 $2.00 75% $3.32 $1.92 $3.10 $1.80
Slide 8: Our Strategic Plan
Our Strategic Plan • Investing in and operating our utilities in a manner consistent with existing regulatory frameworks • Enhancing regulatory frameworks and advocating for responsible energy and economic policies • Creating and capitalizing on opportunities for investment for the benefit of our cu
Slide 9: Four Constructive Regulatory Frameworks
Four Constructive Regulatory Frameworks FERC-regulated: Formula ratemaking Ameren • Allowed ROE is 10.52%, includes MISO participation adder of 50 basis points; ~56% average equity ratio Transmission • Rates reset each Jan. 1 based on forward-looking calculation with annual reconciliation ICC-regula
Slide 10: Expect to Deliver Strong Long-Term EPS and Dividend Growth
Expect to Deliver Strong Long-Term EPS and Dividend Growth • Expect 2021 EPS in a range of $3.75 to $3.951 Long-Term EPS Growth2 and • Remain on track to deliver strong long-term earnings growth 2021 Initial EPS Guidance – Expect 6% to 8% EPS CAGR from 2021-20252 • Using 2021 initial EPS guidance ra
Slide 11: Strong Rate Base Growth in All Regulatory Jurisdictions
Strong Rate Base Growth in All Regulatory Jurisdictions1 Robust five-year infrastructure investment plan in all segments $17.1 Billion of Regulated Infrastructure Investment 2020 to 2025E Regulated Five-Year Rate 2021-2025 Infrastructure Rate Base2 Base CAGR ($ billions) Ameren Illinois Ameren Illin
Slide 12: Expected 2021-2025 Funding Plan
Expected 2021-2025 Funding Plan1 • Cash from Operations – Return of capital through depreciation in rates – Return on equity-financed portion of rate base – ~$1.6 to $1.7 billion of income tax deferrals and tax asset utilization • Income tax deferrals driven primarily by capital expenditures • Inclu
Slide 13: Illinois Energy Legislation
Illinois Energy Legislation Ameren Illinois Electric Distribution • Climate and Equitable Jobs Act (SB 2408) passed by General Assembly; signed into law by Governor – May opt-in to four-year plan (Multi-Year Rate Plan) for rates effective beginning in 2024 • If not opt-in, defaults to future test ye
Slide 14: Illinois Energy Legislation, Cont'd
Illinois Energy Legislation, Cont’d Enhancing regulatory frameworks and advocating for responsible energy and economic policies Current Performance- Traditional Framework Multi-Year Plan (CEJA) Based Rates (Future Test Year) 5.80% + average of 30-year ROE treasury rate each calendar year ICC determi
Slide 15: MISO Long-Range Transmission Planning Roadmap
MISO Long-Range Transmission Planning Roadmap Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment Ameren Transmission • In Apr. 2021, MISO issued report outlining preliminary long-range transmission planning roadmap through 203
Slide 16: Missouri Renewable Energy Investments
Missouri Renewable Energy Investments Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment 400 MW High Prairie Renewable Energy 300 MW Atchison Renewable Energy Center located in northeast Missouri Center located in northwest Mi
Slide 17: Rush Island Energy Center
Rush Island Energy Center Ameren Missouri • In Aug. 2021, U.S. Court of Appeals affirmed the District Court’s Sep. 2019 order to install a flue gas desulfurization system at the Rush Island Energy Center – Reversed the District Court’s order to install a dry sorbent injection system at the Labadie E
Slide 18: Ameren Missouri Generation Transformation
Ameren Missouri Generation Transformation1 Transition to a cleaner and more diverse portfolio in a responsible fashion 2 50% CARBON EMISSIONS 85% CARBON EMISSIONS NET-ZERO CARBON REDUCTION3 REDUCTION3 EMISSIONS3 • Ameren Missouri filed its preferred Integrated Resource Plan with the MoPSC in Sep. 20
Slide 19: Investing in the Energy Grid
Investing in the Energy Grid1 • Investing to modernize energy grid, making it cleaner, safer, more reliable, resilient and secure – Expect greater transmission investments to support additional renewable generation 2020-2025E Regulated – Provide customers with greater tools to manage energy usage In
Slide 20: Robust Investment Opportunities Across All Businesses Over Next Decade
Robust Investment Opportunities Across All Businesses Over Next Decade Modernizing the grid and investing in cleaner generation for the long-term benefit of customers, shareholders and the environment Additional Investment Investment Plan 2021-20251 Opportunities 2021-20301 $40B+ ($ billions) $23+ S
Slide 21: Summary
Summary Expect to deliver strong earnings growth in 2021 with guidance in a range of $3.75 to $3.95 per diluted share1 Successfully executing our strategy; well-positioned for future growth • Focused on delivering a cleaner and sustainable energy future in a responsible manner Strong long-term growt
Slide 22: Financial and Regulatory Update
Financial and Regulatory Update Ameren Missouri’s 400 MW High Prairie Renewable Energy Center placed in service Dec. 2020
Slide 23: 2021 Earnings Analysis for Nine Months Ended Sep. 30
2021 Earnings Analysis for Nine Months Ended Sep. 301 Key Earnings Variance Drivers ↑ Ameren Missouri earnings — Higher electric retail sales: ~+$0.18 Diluted EPS • Weather vs. 2020: ~+$0.08; vs. normal ~+$0.04 • WN sales vs. 2020 (excl. MEEIA): Res.: ~+1.5%, Com.: ~+3.5%, Ind.: ~+1%, Total: ~+2% YT
Slide 24: 2021 EPS Guidance and Select Balance of the Year Considerations
2021 EPS Guidance and Select Balance of the Year Considerations1 • 2021 diluted EPS guidance range raised to $3.75 to $3.95 2021E • Select considerations for Q4 2021 EPS compared to Q4 2020 EPS Diluted EPS – Ameren Illinois Natural Gas delivery service rates and rate design: +$0.03 $3.95 – Parent ti
Slide 25: 2021 Financing Update
2021 Financing Update Debt Financing • On Mar. 5, Ameren Corp. issued $450 million of 1.75% senior unsecured notes due 2028 – Proceeds used for general corporate purposes and to repay short-term debt Ameren Credit Ratings and • On June 22, Ameren Missouri issued $525 million of 2.15% green FMB due 2
Slide 26: Select 2022 Earnings Considerations Compared to 2021
Select 2022 Earnings Considerations Compared to 20211 ↑ New electric service rates effective by late Feb. 2022 — Reflecting new infrastructure and wind generation investments Ameren ↑ Higher investments in infrastructure and wind generation eligible for PISA and RESRAM in Jan. and Feb. 2022 Missouri
Slide 27: Sustainability Financing Framework and Green Bond Issuances
Sustainability Financing Framework and Green Bond Issuances • On June 2, 2021, Ameren published a Sustainability Financing Framework; one of the first utilities in the nation to do so – Framework supports Ameren’s sustainability goals and target of net-zero carbon emissions by 2050, as well as socia
Slide 28: 2021-2022 Winter Season and Rising Natural Gas Prices
2021-2022 Winter Season and Rising Natural Gas Prices Ameren Illinois and Ameren Missouri Natural Gas • ~75-85% price hedged based on normal seasonal sales • 100% volumetrically hedged based on maximum seasonal sales • ~60% of Ameren Illinois' winter supply of natural gas was bought this past summer
Slide 29: Select Regulatory Items
Select Regulatory Items Ameren Missouri Electric Rate Review • In Dec. 2021, MoPSC approved $220 million annual revenue increase1 – Allowed ROE not specified – Common equity ratio: 51.97%2 – Rate base: $10.2 billion3 – Continuation of previously authorized FAC and regulatory tracking mechanisms – Lo
Slide 30: FERC Regulatory Matters
FERC Regulatory Matters Enhancing regulatory frameworks and advocating for responsible energy and economic policies Ameren Transmission • In Apr. 2021, FERC issued supplemental NOPR that would remove incentive adder for utilities that have been members of an RTO for three years or more – Current all
Slide 31: Appendix
APPENDIX
Slide 32: Focused on Delivering Affordable Service to Our Customers
Focused on Delivering Affordable Service to Our Customers Residential rates since key legislative or regulatory enhancements Ameren Missouri Ameren Illinois Ameren Illinois Electric1,2 Electric Distribution3 Natural Gas Distribution3 ¢/KWh ~8.5% ¢/KWh ~3% $/therm ~2% 12.00 12.00 1.20 1.00 10.34 10.5
Slide 33: Focused on Disciplined Cost Management to Keep Customer Rates Affordable
Focused on Disciplined Cost Management to Keep Customer Rates Affordable • Continued focus on disciplined cost management from 2015 to 2020 Ameren – Total operating expenses decreased 14% Operating Expenses – Other non-fuel O&M expenses decreased 2% ($ millions) – Fuel and purchased power expenses d
Slide 34: Improved ESG Ratings
Improved ESG Ratings A AAA 0 Dec. 2021 Dec. 2021 May 2021 A- Water 29.1 A Medium Risk Climate B Range: A-F Range: Range: (A is best) AAA-CCC 0-100 (AAA is best) (Lower is better) F CCC 100 Evercore ISI Virtual Utility Conference | Jan. 12-13, 2022 34
Slide 35: Our Focus on Delivering a Cleaner Energy Future Responsibly
Our Focus on Delivering a Cleaner Energy Future Responsibly1 While providing safe, reliable and affordable energy to customers • Climate risk management and mitigation – Targeting significant reductions in greenhouse gases – Implementing robust customer energy efficiency programs – Investing to mode
Slide 36: Building a Brighter and Cleaner Energy Future
Building a Brighter and Cleaner Energy Future Innovative Programs to Meet Customer Needs and Rising Expectations Utility-owned solar Subscription program generation facilities for MO available to MO residential non-residential customer Neighborhood Community and small business parking lots, open lan
Slide 37: Ameren's Estimated Coal-Related Revenues in 2020
Ameren’s Estimated Coal-Related Revenues in 2020 Return on Investment Revenues Cost Recovery3 Revenues $2.1B1 x $2.1B1 x ($103M $423M + 52% x 48% x x 25%) / $161M x $147M + 9.53%2 = 4.5% = (1 - 25%) 26%1 = $154M = $103M $45M $34M $42M $724M $5,794M 16% Return on Interest Tax Expense Property Fuel, o
Slide 38: GAAP to Core Earnings Per Share Reconciliations
GAAP to Core Earnings Per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 2020 GAAP Earnings / Diluted EPS $1.18 $2.40 $2.59 $2.68 $2.14 $3.32 $3.35 $3.50 Exclude results from discontinued operations 0.87 — (0.01) — — — — — Less: Income tax benefit / expense 0.05 — (0.20
Slide 39: Weather-Normalized Earnings per Share Reconciliations
Weather-Normalized Earnings per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 2020 Core1 Diluted EPS $2.10 $2.40 $2.56 $2.68 $2.83 $3.37 $3.35 $3.50 Ameren Missouri weather impact included in Electric 0.03 0.05 (0.04) 0.16 (0.07) 0.43 0.04 (0.05) Margins Less: Income t
Slide 40: Investor Relations Calendar
Investor Relations Calendar JANUARY 2022 FEBRUARY / EARLY MARCH 2022 SUN. MON. TUES. WED. THUR. FRI. SAT. SUN. MON. TUES. WED. THUR. FRI. SAT. 2 3 4 5 6 7 1/8 1 2 3 4 5 Q4 Quiet Period cont’d 9 10 11 12 13 14 15 6 7 8 9 10 11 12 Q4 Quiet Evercore Evercore Period ISI Conf. ISI Conf. begins 16 17 18 1
Slide 41: Select Regulatory and Legislative Matters
Select Regulatory and Legislative Matters Missouri Public Service Commission • Order approving electric rate review filling: Docket No. ER-2021-0240 • Order approving natural gas rate review filing: Docket No. GR-2021-0241 • Smart Energy Plan filing: Docket No. EO-2019-0044 • 2020 Integrated Resourc
Slide 42: Glossary of Terms and Abbreviations
Glossary of Terms and Abbreviations AFUDC – Allowance for funds used during construction IRP – Integrated resource plan ATXI – Ameren Transmission Company of Illinois ISRS – Infrastructure System Replacement Surcharge B – Billion M – Million bps – Basis points MEEIA – Missouri Energy Efficiency Inve
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