The paragraph is an introduction to the Ameren Corporation's Third Quarter 2024 Earnings Call. It starts with a greeting from the operator, followed by an introduction of Andrew Kirk, the Director of Investor Relations, who is hosting the call. Other key executives present include Marty Lyons, the Chairman, President, and CEO, and Michael Moehn, the Senior EVP and CFO. The call includes discussions on forward-looking statements, and listeners are directed to Ameren's SEC filings for more details. Marty Lyons then starts his presentation, emphasizing Ameren's focus on delivering long-term value for its stakeholders.

The paragraph highlights the company's strategic investments in rate-regulated infrastructure and regulatory enhancements to capitalize on future opportunities while maintaining low customer rates and transforming the energy grid for improved reliability and cleaner energy. The company reports third quarter 2024 adjusted earnings of $1.87 per share, consistent with the previous year's results, but notes specific exclusions related to ongoing legal proceedings. These involve settlements concerning environmental compliance and customer refunds mandated by FERC. Despite these charges, the company remains optimistic about growth, driven by a strong investment pipeline and significant economic opportunities, especially in the Greater St. Louis area, which is experiencing notable employment growth.

In August, the region ranked fourth among large metro areas in employment growth, which is reflected in robust retail sales across Missouri. The company is on track to meet 2024 earnings guidance of $4.55 to $4.69 per share and expects 2025 earnings to be $4.85 to $5.05 per share, indicating a potential 7.1% increase. Early 2025 guidance is provided to boost confidence in meeting a 6% to 8% growth target. Long-term earnings and capital plans will be detailed in February. The company has invested $3 billion year-to-date in infrastructure improvements for a cleaner energy transition, including closing on three solar centers totaling 500 megawatts.

The paragraph discusses various developments related to MISO and Ameren's transmission and generation projects. MISO is advancing its long-range transmission planning, expecting approval for a $3.6 billion investment in Missouri and Illinois by year-end. Ameren Missouri is progressing with a new $900 million, 800-megawatt natural gas energy center, Castle Bluff, which received approval from the Missouri Public Service Commission, creating jobs and enhancing energy reliability. An agreement with the US Department of Justice related to the Rush Island Energy Center is also mentioned. Lastly, Ameren Illinois awaits a decision from the Illinois Commerce Commission on a revised electric distribution rate plan, with strong stakeholder support and anticipated approval by year-end.

The paragraph details Ameren Missouri's ongoing efforts to enhance its energy infrastructure. It highlights the company's focus on maintaining a diverse and cost-effective energy mix through its Integrated Resource Plan, which includes the commissioning of three solar projects and planning for an additional 400 megawatts of solar generation by 2025-2026. Additionally, it mentions the Missouri PSC's approval for the construction of the Castle Bluff Energy Center, a dispatchable 800-megawatt natural gas facility. This center, expected to be operational by 2027, will enhance grid reliability by complementing the variable nature of solar energy. The center will be built on the site of the retired Meramec Energy Center, utilizing existing infrastructure to speed up construction.

The paragraph discusses ongoing efforts to enhance energy generation and transmission in Missouri and Illinois, highlighting the MISO's $22 billion tranche 2.1 portfolio aimed at improving regional reliability and capacity. This includes three projects with a $3.6 billion investment in the service territories. MISO plans to approve these projects by year's end, with work on tranche 2.2 starting in 2025. The paragraph also notes broader economic growth in the service areas, with new contracts and expansions promising 350 megawatts of load and over 2,200 jobs, primarily in Missouri, by 2028, particularly in sectors like aerospace, agriculture, and food processing.

The article discusses the promising growth opportunities in the energy sector over the next five to seven years, emphasizing job creation and benefits for local communities. It highlights the increasing demand for new business and data centers, with the potential customer interest in gigawatts requiring transmission engineering studies. The financial impact of this growth depends on various factors, including customer ramp-up time and grid investments. The company plans to update its Integrated Resource Plan by February 2025 to align with these opportunities. Additionally, it announces the retirement of the Rush Island Energy Center after nearly fifty years of service.

The paragraph discusses Ameren Missouri's efforts to manage the retirement of Rush Island by ensuring affected employees have opportunities within the company and obtaining authorization from the Missouri PSC to recover $470 million in costs through securitization. A settlement with the US Department of Justice requires Ameren Missouri to fund $64 million in mitigation programs, including electrification of school buses and residential air purifiers. This settlement awaits court approval. Over the next decade, Ameren Missouri plans to invest over $55 billion, driving job creation, tax revenue, and economic growth. The investment plan could expand if additional generation is needed, with updates expected in February. The company projects a 6% to 8% annual earnings growth rate from 2024 to 2028.

The paragraph discusses Ameren's financial performance and strategic approach. It highlights Ameren's strong compound annual rate base growth of 8.2% and strategic investment across its business segments, resulting in a notable 6% to 8% earnings growth and a 3.1% dividend yield. Ameren reported third quarter 2024 GAAP earnings of $1.70 per share, impacted by charges for mitigation relief at the Rush Island Energy Center and an October 2024 FERC order. Excluding these charges, third quarter adjusted earnings were $1.87 per share, consistent with the previous year. The paragraph also mentions a $0.17 per share after-tax charge for the mitigation relief program agreed with the US Department of Justice, anticipating settlement approval by the district court.

The paragraph discusses changes in the allowed base Return on Equity (ROE) for FERC-regulated transmission within MISO, which was adjusted to 9.98% from November 2013 through February 2015 and from September 2016 onwards, resulting in a slight decrease from the previous rate and necessitating refunds. Despite this change, the current ROE for MISO projects is 10.48% with a 50 basis point adder, and the company does not anticipate a significant impact on future earnings. The paragraph also covers Ameren's third-quarter earnings, which were positively influenced by strategic investments and cost management, despite some negative impacts from changes in ROE and rate design at Ameren Illinois. Sales trends for Ameren Missouri and Ameren Illinois are also mentioned, highlighting a year-to-date increase in weather-normalized retail sales and industrial production growth.

The paragraph discusses the financial outlook and expectations for the company, specifically focusing on weather-normalized electric sales in Illinois and future earnings projections. Despite flat sales compared to the previous year, earnings are unaffected due to revenue decoupling. The company anticipates positive earnings impacts in the fourth quarter of 2024, driven by infrastructure investments and cost management. For 2025, they expect earnings per share to range from $4.85 to $5.05, representing over 7% growth compared to 2024. Ameren Missouri's earnings are expected to rise due to new electric service rates, increased investments, and higher sales particularly to commercial and industrial customers. An updated long-term sales forecast is expected in February.

The paragraph discusses anticipated financial impacts and regulatory updates for Ameren's various operations. There will be higher interest expenses at Ameren Missouri, Ameren Parent, Transmission, and Ameren Illinois Electric Distribution due to increased infrastructure investments. Ameren Illinois Natural Gas earnings are expected to decline because of cost recovery timing issues. An increase in common shares is anticipated to negatively affect earnings per share. Despite these challenges, the company is optimistic about growth opportunities through infrastructure investments and strategic focus. In Missouri, a procedural schedule has been set for Ameren Missouri's electric rate review, with results expected by May 2025. If approved, the proposed rates will remain below national and regional averages, driven largely by investments in the Smart Energy Plan. In Illinois, following the expiration of formula rate-making in 2023, Ameren Illinois proposed a $158 million reconciliation adjustment for 2023's revenue, which the ICC staff has recommended approving, to be collected in 2025.

The article discusses financial updates and future plans for rate adjustments and investments. It anticipates a net cash flow increase of $48 million and a 1.5% rise in residential customer bills, with new rates effective in 2025. The ALJ recommended a $315 million revenue increase for a multiyear rate plan from 2024 to 2027. This supports significant investment in energy infrastructure for reliability and clean energy transition. An ICC decision is expected by December, and any annual revenue should not exceed 105% of approved requirements. To maintain strong credit ratings and fund infrastructure plans, Ameren plans to issue $300 million in common equity in 2024.

By the end of 2023, the company sold $230 million of the anticipated $300 million through its at-the-market (ATM) program, which includes 2.9 million shares expected to settle by year-end. Together with 401(k) and DRIP plus programs, this will meet 2024 equity needs. They've also secured forward sales agreements for $155 million to support 2025 equity needs at an average price of $82 per share. The company remains confident in its long-term strategy, which focuses on infrastructure investment, regional economic growth, and customer expansion to drive earnings growth. They believe their strategy and team will deliver value to stakeholders and compare favorably with peers, offering an attractive dividend and total shareholder return.

In the paragraph, Robin, speaking on behalf of Jeremy Tonet from JPMorgan, asks Marty Lyons about the company's strategy in providing 2025 guidance amidst ongoing regulatory proceedings. Lyons responds by expressing strong confidence in the company's ability to achieve its growth targets due to factors such as cooling inflation, a robust local economy, improved demand, and significant investments across various segments. He highlights the company's history of achieving growth rates of 7% or higher and emphasizes their solid balance sheet. Lyons also notes that while they typically deliver guidance in February, they are providing it earlier this year due to their strong confidence in meeting their targets regardless of future developments. Robin then asks about economic development opportunities.

In the paragraph, Marty Lyons discusses the significant interest in potential energy demand and opportunities amounting to several gigawatts. He acknowledges the possibility of double-counting as various developers and companies might be evaluating the same properties. Lyons explains that they are methodically working with potential partners to assess sites and necessary infrastructure, and they have not announced any new loads until construction agreements are reached. He mentions expectations for greater visibility on demand in the coming months, with plans to update sales forecasts and their integrated resource plan (IRP) in February. Robin expresses gratitude for the information before the conversation moves to a question from Paul Patterson.

In the conversation, Paul Patterson asks about the status of a refilled group plan involving oral arguments requested by the AG. Marty Lyons explains that the differences have been narrowed down thanks to the efforts of their teams and stakeholders. He reassures that it is normal to have oral arguments at this stage and expresses confidence in the ALJ's proposed order, expecting a favorable decision by December. Michael Moehn adds that these arguments have been planned for some time and are scheduled for November 20th, noting that the grid plan has widespread support. Patterson also asks about slide nine regarding transmission projects and customer call activity, seeking more information on its impact on customers.

The paragraph discusses the assessment of customer benefits versus portfolio costs for a range of projects valued at approximately $22 billion proposed by MISO. These projects are expected to reduce customer costs over time. Paul Patterson inquires about the immediate impact of these investments, to which Marty Lyons responds that the effects will be gradual, with no specific rate impacts currently available. Additionally, Lyons notes interest from data centers in both Missouri and Illinois, with 75% of the new demand in their pipeline coming from data centers, 15% from manufacturing, and 10% from other industries.

The article discusses data center interest and construction agreements in Missouri and Illinois. Currently, 65% of the interest is in Missouri and 35% in Illinois, with 90% of the announced construction agreements in Missouri and 10% in Illinois. The earnings impact differs between the states: in Illinois, it involves transmission or distribution investment, while in Missouri, which is vertically integrated, it includes incremental generation opportunities. Additionally, Marty Lyons addresses Carly Davenport's question about the earnings guidance range, stating they are targeting an EPS CAGR of 6% to 8% for 2024 to 2028.

In this paragraph, the speakers discuss their company's strong track record of delivering growth above the midpoint, specifically targeting a 6% to 8% growth rate in the future. They mention positive indicators such as slow growth, potential load growth, and robust investment opportunities, particularly in data centers and the Missouri territory. The overall economic conditions, including employment, GDP, customer, and population growth, are favorable. They plan to update their investment plans and provide further guidance in February, aiming to leverage additional investment opportunities and optimize financing for continued growth.

In the paragraph, Michael Moehn discusses ongoing efforts to reduce Operations and Maintenance (O&M) costs in the second half of the year. Despite year-over-year increases in the third quarter, efficiency improvements are expected in the fourth quarter, particularly in Missouri and Illinois Natural Gas. These efforts include managing headcount, controlling discretionary spending, and simplifying processes to drive consistency and efficiency across their platform. Moehn emphasizes their commitment to these long-standing programs and notes continuous benchmarking to identify areas for improvement. Carly Davenport acknowledges and thanks Moehn for the information.

In this Q&A segment, Brian, substituting for Julien Dumoulin Smith from Jefferies, inquires about the anticipated growth in Ameren Transmission's rate base, noting a projected 9% increase from 2024 to 2025 and a potential double-digit compound annual growth rate. He questions whether this growth is due to MISO tranche one projects and if tranche two projects could be moved forward from their initial timeline in the early to mid-2030s. Marty Lyons responds, indicating that tranche one construction is expected between 2026 and 2030, while tranche two projects are anticipated for 2032 to 2034, although efforts will be made to accelerate them. He notes ongoing transmission projects aside from these tranches contribute to growth. Michael Moehn adds briefly, referencing a "$55 billion pipeline," though the context remains unclear.

In the paragraph, a discussion takes place about financial allocations and future plans related to the Long-Range Transportation Plan (LRTP) projects, involving several financial tranches. Brian inquires about Ameren's involvement in proposed legislative activities ahead of the 2025 Missouri legislative session, particularly regarding the expansion of the Public Infrastructure Stabilization Act (PISA) to cover generation assets. Marty Lyons responds that advocating for such expansions and ensuring timely transmission projects are high priorities for Ameren, emphasizing their benefits in ensuring reliable and low-cost power for the region.

The paragraph discusses plans for addressing potential load growth in Missouri, where the company is vertically integrated and owns generation facilities. Marty Lyons explains that while current resources can meet the additional 350 megawatts of load from recently announced construction agreements, further load growth may necessitate new generation resources. The company is considering these needs and will update its integrated resource plan early next year to provide more clarity.

The paragraph discusses the considerations around the incremental costs associated with investments made to serve both existing and new customers fairly. There is an ongoing dialogue with entities looking to expand, and these discussions are expected to continue. Michael Moehn mentions the historical reliance on closing plants and the need to assess additional generation capacity, including the possibility of filing an updated Integrated Resource Plan (IRP) due to potential load growth. Marty Lyons mentions evaluating renewable resources and battery storage technologies, as well as the need for additional gas-fired generation, as part of the IRP update. David Paz inquires about earnings per share (EPS) growth guidance for 2025, and Lyons confirms that updates will be based on the 2025 midpoint expectation of $4.95.

In this paragraph, Nick Campanella from Barclays asks about the company's capital plans and whether increased capital in the short term will affect their equity needs, as well as if they will continue using the ATM or consider other financing options. Michael Moehn responds by stating that the company is focused on their $21.9 billion capital plan and is currently finalizing their capital planning process. He indicates that their financing plans remain consistent with those announced previously, with a focus on maintaining their credit ratings and a consolidated equity ratio of around 40%. Moehn also mentions their progress towards their 2025 financial goals and notes that recent elections might influence some EPA-driven investments in their plan.

Marty Lyons discusses the implications of recent federal elections on the company's strategy and policies, emphasizing that their priorities remain unchanged. They continue to focus on infrastructure investments, energy policy advocacy, and economic development. Lyons highlights that changes in tax policy, particularly corporate income tax rates and clean energy tax credits, are significant concerns. The company anticipates a reduced likelihood of corporate tax increases under Republican leadership, which would benefit customers' bills. Additionally, discussions around clean energy tax provisions in the Inflation Reduction Act (IRA) are expected, with Republicans likely preferring targeted adjustments due to their direct benefits to customers. The company sees particular value in tax credits related to solar, battery storage, nuclear, and wind energy. Transferability was mentioned but not elaborated on.

The paragraph discusses the importance of the transferability of tax credits, which are expected to provide significant benefits to customers in Missouri, valued at around $1.5 billion over the next ten years. The speaker emphasizes communicating these benefits to policymakers. They plan to make necessary investments from a reliability and affordability perspective while adopting new technologies. The speaker also addresses EPA rules, expressing skepticism about the current greenhouse gas regulations due to legal challenges and provisions related to carbon capture and natural gas co-firing. They foresee potential changes in administration affecting these rules and conclude with thanks after answering questions.

The speaker expresses gratitude to the attendees, emphasizes their focus on ending the year successfully, and looks forward to an upcoming conference. The operator then ends the conference call, inviting participants to disconnect and enjoy their day.

This summary was generated with AI and may contain some inaccuracies.