Ameren Corporation · NYSE:AEE
Ameren — ESG Presentation (September 2020)
51 slides from Ameren's sustainability presentation, Sep 28, 2020
Slide 1: Leading the Way to a Sustainable Energy Future
Leading the Way to a Sustainable Energy Future Environmental, Social & Governance (ESG) Sep. 2020
Slide 2: Cautionary Statements
Cautionary Statements Use of Non-GAAP Financial Measures In this presentation, Ameren has presented core earnings per share, which is a non-GAAP financial measure and may not be comparable to that of other companies. A reconciliation of GAAP to non-GAAP information is included in this presentation.
Slide 3: Company Description
Company Description Fully rate-regulated electric and natural gas utility Ameren Businesses 2.4M Corporate Headquarters electric Ameren Missouri customers Electric Service Territory • Electric transmission, distribution, and generation business Electric & Natural Gas Territory and a natural gas dist
Slide 4: How We Integrate Sustainability
How We Integrate Sustainability Leading the Way to a Sustainable Energy Future | Sep. 2020 4
Slide 5: How We Think About Sustainability
How We Think About Sustainability ENVIRONMENTAL SOCIAL IMPACT STEWARDSHIP Mission: To Power the Quality of Life Vision: Leading the Way to a Sustainable Energy Future SUSTAINABLE GOVERNANCE GROWTH Leading the Way to a Sustainable Energy Future | Sep. 2020 5
Slide 6: How We View Sustainability Pillars and Risks
KEY FOCUS PILLARS AREAS OF Climate Change Environmental Justice Environmental Compliance Emissions Reductions Waste Management ENVIRONMENTAL Leading the Way to a Sustainable Energy Future | Sep. 2020 Water Management social and governance pillars Community Impact Data Privacy/Cyber Security Diversit
Slide 7: Our Sustainability Value Proposition
Our Sustainability Value Proposition ENVIRONMENTAL SOCIAL GOVERNANCE • Accelerating transition to a cleaner and • Delivering value to our customers while • Diverse BOD focused on strong oversight more diverse portfolio focused on safety-first work culture – 55% women or people of color – Target carb
Slide 8: Environmental Stewardship
Environmental Stewardship 8
Slide 9: Our Focus on Delivering a Cleaner Energy Future Responsibly
Our Focus on Delivering a Cleaner Energy Future Responsibly • Climate risk management and mitigation – Targeting significant reductions in greenhouse gases Target to Achieve Net-Zero – Implementing robust energy efficiency programs Carbon Emissions by 2050 – Investing to modernize the grid and harde
Slide 10: Ameren Missouri Generation Transformation
Ameren Missouri Generation Transformation Transition to a cleaner and more diverse portfolio in a responsible fashion 1 50% CARBON EMISSIONS 85% CARBON EMISSIONS NET-ZERO CARBON REDUCTION2 REDUCTION2 EMISSIONS2 • Ameren Missouri filed its preferred Integrated Resource Plan with the MoPSC in Sep. 202
Slide 11: Target to Achieve Net-Zero Carbon Emissions by 2050
Target to Achieve Net-Zero Carbon Emissions by 2050 Executing on transformation that will ultimately replace fossil fuels with clean sources of energy Sources of Energy Current 2030 2040 2050 12% 3% 25% 25% 27% 17% 46% 5% 30% 58% 69% 25% 1% 53% 4% Coal Gas Renewables Nuclear Other Zero Carbon • Pref
Slide 12: Ameren Carbon Emissions Pathways vs. Global Net Carbon Pathways
Ameren Carbon Emissions Pathways vs. Global Net Carbon Pathways1 Our plan is consistent with Paris Agreement 60 Our net-zero carbon emissions goal is consistent with the objectives of Million Metric Tons CO2 50 the Paris Agreement and limiting 40 global temperature rise to 1.5ºC 30 20 10 - 2020 2030
Slide 13: Robust and Cost-Effective Energy Efficiency and Demand Response Programs
Robust and Cost-Effective Energy Efficiency and Demand Response Programs • Energy efficiency programs generated over $3.5 billion in net benefits for all customers from 2010 to 2019 • Robust energy efficiency programs have helped residential and business customers save more than 5,700,000 MWh from 2
Slide 14: Transmission Investment to Support Transition to Clean Energy
Transmission Investment to Support Transition to Clean Energy Ameren Regional Beneficial Projects • Regional Beneficial Projects – Illinois Rivers Project – 8 of 9 line segments in-service Dec. 2018; remaining line segment in-service by Dec. 2020 • 375 miles of new transmission lines crossing Illino
Slide 15: "Exemplary" Callaway Nuclear Operations
“Exemplary” Callaway Nuclear Operations • Consistent availability – Top decile in lifetime generation among 97 U.S. nuclear plants – Extended operating license through 2044 – Replaced major plant components, including steam generators and reactor vessel head – Expect to seek an extension of operatin
Slide 16: Environmental Stewardship – Coal-Fired Energy Centers
Environmental Stewardship – Coal-Fired Energy Centers CO2 emissions reduction NOx emissions reduction SO2 emissions reduction Mercury emissions (generation): 28%1 (generation): (generation): reduction (generation): 51% below 2005 level1 68% below 2005 level1 91% below 2005 level1 78% below EPA stand
Slide 17: Focusing on Resource Management
Focusing on Resource Management Electrification: Methane Leak Reductions: Methane Emissions: Pledged along with four other Midwest Replaced 100% cast and wrought iron <0.5% of our carbon energy companies to build a vast pipeline on our natural gas delivery emissions in 2019 network of Midwest EV cha
Slide 18: Social Impact
Social Impact 18
Slide 19: Our Focus on Social Responsibility
Our Focus on Social Responsibility • Delivering value to our customers while focused on safety-first work culture – Providing safe, reliable and affordable electric and natural gas services for customers – Offering customers innovative programs incorporating clean energy • Socially responsible and e
Slide 20: Focused on Safety of Our Co-Workers
Focused on Safety of Our Co-Workers • Safety is a core value at Ameren — one that is never compromised • Recordable Safety Events are down 46% from 2008 to 2019 • Co-worker to co-worker (c2c) feedback interactions designed to reflect the enhanced focus on positive feedback and two-way dialogue • Ame
Slide 21: Supporting Our Community and Workforce During COVID-19
Supporting Our Community and Workforce During COVID-19 • Delivering safe, reliable and affordable energy – Continued effective execution of work plans in Missouri and Illinois while developing and maintaining robust safety protocols – Modified work practices to keep co-workers and customers safe – T
Slide 22: Delivering Strong Value to Our Customers
Delivering Strong Value to Our Customers Increased Customer Improved Reliability1 Affordable Rates2 Outage JD Power Satisfaction3 Duration (min) ¢/KWh Score 300 +43% 15 750 +17% Better Better 725 734 276 731 250 12.87 12.72 723 10 700 10.29 200 9.95 690 675 150 663 157 5 650 651 100 625 628 50 0 600
Slide 23: 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 24: Reducing Energy Burden for Income-Eligible Customers
Reducing Energy Burden for Income-Eligible Customers • Invested over $100 million on income-eligible customer programs from 2017-2019 through energy efficiency and energy assistance • Installed over 9,500 free smart thermostats, providing customers better control over their energy usage, throughout
Slide 25: Supporting Our Communities through Corporate Contributions
Supporting Our Communities through Corporate Contributions • Nearly $30 million distributed in cash and in-kind donations from 2017-2019 • Over 700 community-based organizations supported in 2019 • Over 900 grants and sponsorships supported in 2019 • Thousands of hours volunteered annually by co-wor
Slide 26: Significantly Supporting Supplier Diversity in 2019
Significantly Supporting Supplier Diversity in 2019 “I am most proud of our work on the Ameren IL Gas Operations building and Ameren providing GIVSCO Construction an opportunity to have a seat at the table – not behind it, not beside it, but at the table.” -Ronald Givens, Jr. “Ameren has been very s
Slide 27: Supporting Diversity, Equity and Inclusion in Our Company, Communities and Country
Supporting Diversity, Equity and Inclusion in Our Company, Communities and Country • DE&I is one of our core values – Ameren Executive Leadership Team statement against racial injustice – Co-lead local Inclusion and Diversity Task Force to empower the business community towards inclusive economic gr
Slide 28: Building Diverse Workforce Pipelines
Building Diverse Workforce Pipelines • Early-Career Pipeline Programs – Create strong, diverse pipelines in skilled craft and STEM for middle school, high school and college students – Gas Painter Program and Skilled Craft Education Program leverage high school partnerships to provide students inter
Slide 29: Recent ESG Recognitions
Recent ESG Recognitions • 2020 DiversityInc: 2nd in Top 6 Utilities, 9th for BOD - all industries; 12th consecutive year ranked in the nation’s top five utilities • 2020 Top Utilities in Economic Development, Site Selection Magazine • 2020 Best Workplaces in Manufacturing and Production • 2020 Great
Slide 30: Governance
Governance 30
Slide 31: Our Focus to Maintain Strong Corporate Governance
Our Focus to Maintain Strong Corporate Governance • Diverse, experienced and engaged Board of Directors – Focused on strong oversight, committed to maintaining a diverse set of perspectives, qualifications, qualities and skills • ESG matters managed at all levels – Overseen directly by BOD or applic
Slide 32: Diverse, Highly Skilled Board of Directors
Diverse, Highly Skilled Board of Directors Warner L. Cynthia J. Catherine J. Edward Ward H. Noelle K. Ellen M. Rafael Richard J. Craig S. James C. Steven H. Stephen R. Qualifications and Experience Baxter Brinkley S. Brune Coleman Dickson Eder Fitzsimmons Flores Harshman Ivey Johnson Lipstein Wilson
Slide 33: Board of Directors Composition and Leadership Highlights
Board of Directors Composition and Leadership Highlights • 13 members; all independent except for CEO/Chair – Corporate Governance Guidelines require substantial majority of the board to be independent – Only independent directors may serve on standing board committees • BOD is focused on ensuring a
Slide 34: Board of Directors-Level Governance of Sustainability
Board of Directors-Level Governance of Sustainability Strong oversight over sustainability and ESG matters Ameren’s Board of Directors oversees all significant enterprise risks, including sustainability and ESG. It has specifically delegated oversight of certain sustainability/ESG matters to several
Slide 35: Management-Level Governance of Sustainability
Management-Level Governance of Sustainability Senior executives across all business segments that oversee risk management, strategic planning and Executive Leadership Team enterprise performance related to ESG matters. Leads the Company’s A cross-enterprise group approach to managing of leaders that
Slide 36: Executive Compensation Program – Ties to Sustainability
Executive Compensation Program – Ties to Sustainability The objective of Ameren's executive compensation program is to provide a competitive total compensation program based on the size- adjusted median compared to similar utility companies, adjusted for individual performance. Ameren’s short- and l
Slide 37: Political Contributions Accountability and Disclosure
Political Contributions Accountability and Disclosure • 1st among utilities and 2nd highest score overall (97.1%) in the 2019 CPA-Zicklin Index for Corporate Political Disclosure and Accountability • Board of Directors-approved Political Contributions Policy – Annual contribution limit established b
Slide 38: Cybersecurity Risk Management
Cybersecurity Risk Management Robust enterprise-wide security program focused on safety • Robust governance and oversight of cybersecurity issues – Updates provided to Audit and Risk Committee at each regular meeting – Key performance metrics leveraging National Institute of Standards and Technology
Slide 39: Sustainable Growth
Sustainable Growth 39
Slide 40: Our Value Proposition for Customers, Shareholders and the Environment
Our Value Proposition for Customers, Shareholders and the Environment Strong long-term Attractive Attractive total growth outlook dividend return potential • Affirm expected 6% to 8% EPS CAGR • Annualized equivalent dividend rate • Track record of delivering strong from 2020-20241,2 of $1.98 per sha
Slide 41: Strong Track Record of EPS and Dividend Growth
Strong Track Record of EPS and Dividend Growth Weather-Normalized Core Dividends Paid per Share3 Weather-Normalized Earnings per Diluted Share1 Dividend Payout Ratio +60% or $2.00 +20% 80% $3.50 2013 to 2019 ~8% CAGR $1.98 $3.50 75% 2013 to 2019 $1.92 $3.32 $3.10 $1.85 $3.05 70% $1.75 $1.78 $2.88 $2
Slide 42: Investing in the Energy Grid
Investing in the Energy Grid Creating and capitalizing on opportunities for investment for the benefit of our customers, shareholders and the environment • Investing to modernize energy grid – Provide a more safe, reliable, resilient and secure energy grid 2019-2024E Regulated – Enable two-way energ
Slide 43: Robust Investment Opportunities Across All Businesses Over Next Decade
Robust Investment Opportunities Across All Businesses Over Next Decade1 Modernizing the grid and investing in cleaner generation for the long-term benefit of customers, shareholders and the environment Investment Plan 2020-2024 Investment Opportunities 2025-2029 $36B+ ($ billions) Strong Pipeline of
Slide 44: Additional Growth Initiatives
Additional Growth Initiatives Economic Development • Ameren Missouri – Aggressive energy-based economic development incentives, providing five-year, average 40% discount on base rates for qualifying customers – Delivered 17 successful business development projects in 2019, creating or retaining over
Slide 45: Appendix
Appendix 45
Slide 46: Additional Sustainability Resources
Additional Sustainability Resources Available at www.amereninvestors.com (hyperlinked below) • Integrated Resource Plan COMMUNICATIONS • Sustainability Report ENHANCEMENTS • EEI and AGA ESG/Sustainability Template Q4 2020 • Coal Combustion Residuals Information • Methane Management Report • DE&I Lea
Slide 47: Company-Wide Governance of Sustainability
Company-Wide Governance of Sustainability Current policies available at www.amereninvestors.com (hyperlinked below) Environmental Policy Environmental Justice Policy (In Progress) Integrate environmental management and Engage stakeholders and create proactive sustainability principles into our solut
Slide 48: Ameren's Estimated Coal-Related Revenues in 2019
Ameren’s Estimated Coal-Related Revenues in 2019 Return on Investment Revenues Cost Recovery Revenues $2.08B1 x $2.08B1 x ($103.1M x $423M + $952.5M / 52% x 48% x 27.25%) / (1 $161M x $147M + $5,910M = 9.53%2 = 4.5% = - 27.25%) 26%1 = $154M = $103.1M $44.9M $38.6M $41.9M $724M $5,910M 16% Return on
Slide 49: 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 GAAP Earnings Per Diluted Share $1.18 $2.40 $2.59 $2.68 2.14 $3.32 $3.35 Exclude results from discontinued operations 0.87 — (0.01) — — — — Less: Income tax expense / (benefit) 0.05 — (0.20) — — —
Slide 50: Weather-Normalized Earnings Per Share Reconciliations
Weather-Normalized Earnings Per Share Reconciliations Year Ended Dec. 31, 2013 2014 2015 2016 2017 2018 2019 Core1 Diluted EPS $2.10 $2.40 $2.56 $2.68 $2.83 $3.37 $3.35 Effects of weather at Ameren Missouri 0.03 0.05 (0.04) 0.16 (0.07) 0.43 0.04 Less: Income tax expense (0.01) (0.02) 0.01 (0.06) 0.0
Slide 51: Glossary of Terms and Abbreviations
Glossary of Terms and Abbreviations AGA – American Gas Association Hg – Mercury ATXI – Ameren Transmission Company of Illinois GAAP – Generally Accepted Accounting Principles BOD – Board of Directors ICC – Illinois Commerce Commission C – Celsius IRP – Integrated Resource Plan C&I – Commercial & Ind