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Report & Order - Ameren [12/12/

Report & Order - Ameren [12/12/

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12/12/2012

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Thomas M. Byrne, Managing Assoc. General Counsel, and Wendy K. Tatro, Asst.
General Counsel, Ameren Services Company, P.O. Box 66149, 1901 Chouteau Ave., St.
Louis, Missouri 63103;

James B. Lowery, Attorney at Law, and Michael Tripp, Smith Lewis, LLP, P.O. Box 918,
Suite 200, City Centre Building, 111 South Ninth St. Columbia, Missouri 65205-0918; and

Russ Mitten, Attorney at Law, Brydon, Swearengen & England, 312 E. Capital Ave.,
Jefferson City, Missouri 65102.

For Union Electric Company, d/b/a Ameren Missouri.

Kevin Thompson, Chief Staff Counsel, Jennifer Hernandez, Senior Legal Counsel,
Sarah Kliethermes, Senior Legal Counsel, Meghan McClowery, Legal Counsel, and Amy
Moore
, Legal Counsel, P.O. Box 360, 200 Madison Street, Jefferson City, Missouri 65102

For the Staff of the Missouri Public Service Commission.

Lewis R. Mills, Jr., Public Counsel, and Christina Baker, Legal Counsel, P.O. Box 2230,
200 Madison Street, Suite 650, Jefferson City, Missouri 65102

For the Office of the Public Counsel and the Public.

Jennifer S. Frazier, Assistant Attorney General, and Jessica L. Blume, Assistant Attorney
General, P.O. Box 899, Jefferson City, Missouri 65102

For the Missouri Department of Natural Resources.

David Woodsmall, Attorney at Law, WOODSMALL LAW OFFICE, 807 Winston Court,
Jefferson City, Missouri 65101

For the Missouri Energy Consumers Group.

Diana Vuylsteke, Attorney at Law, Brent Roam, Attorney at Law, Edward F. Downey,

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Attorney at Law, and Carol Iles, Attorney at Law, Bryan Cave, LLP, 211 N. Broadway,
Suite 3600, St. Louis, Missouri 63102

For Missouri Industrial Energy Consumers.

Lisa C. Langeneckert, Attorney at Law, Sandberg, Phoenix & Von Gontard, P.C., 600
Washington Ave, 15th

Floor, St. Louis, Missouri 63101.

For Barnes-Jewish Hospital.

John B. Coffman, Attorney at Law, John B. Coffman, LLC, 871 Tuxedo Blvd, St. Louis,
Missouri 63119-2044.

For AARP and the Consumers Council of Missouri.

Thomas R. Schwarz, Attorney at Law, Blitz, Bardgett & Deutsch, L.C. 308 East High
Street, Suite 301, Jefferson City, Missouri 65101.

For the Missouri Retailers Association.

Henry B. Robertson, Attorney at Law, Great Rivers Environmental Law Center, 705 Olive
St., Suite 614, St. Louis, Missouri 63101

For Natural Resources Defense Council, Sierra Club, and Earth Island Institute d/b/a
Renew Missouri.

Larry W. Dority, Attorney at Law and James M. Fischer, Attorney at Law, FISCHER &
DORITY, PC, 101 Madison St., Suite 400, Jefferson City, Missouri 65101

For Kansas City Power & Light Company and KCP&L Greater Missouri Operations
Company.

Sherrie A. Hall, Attorney at Law, Michael A. Evans, Hammond and Shinners, P.C. 7730
Carondelet Ave., Suite 200, St. Louis, Missouri 63105.

For International Brotherhood of Electrical Workers Locals 2, 309, 649, 702, 1439, 1455,
AFL-CIO and International Brotherhood of Operating Engineers Local 148, AFL-CIO.

CHIEF REGULATORY LAW JUDGE: Morris L. Woodruff

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REPORT AND ORDER

Table of Contents

Appearances ............................................................................................................... 1

Procedural History ....................................................................................................... 5

The Partial Stipulations and Agreements .................................................................... 7

Overview .................................................................................................................... 8

Conclusions of Law Regarding Jurisdiction ................................................................. 9

Conclusions of Law Regarding the Determination of Just and Reasonable Rates ...... 10

The Rate Making Process ........................................................................................... 12

The Issues ................................................................................................................... 12

1. Regulatory Policy and Economic Conditions .......................................................... 12

2. Cash Working Capital ............................................................................................. 14

A. Calculation of the Collection Lag ...................................................................... 14

B. Removal of Income Tax Calculation ................................................................. 19

3. Income Tax & ADIT & NOL .................................................................................... 22

A. ESOP Accounts ................................................................................................ 22

B. CWIP Related ADIT Balances .......................................................................... 26

4. Plant In Service Accounting (PISA) ........................................................................ 30

5. Rate Case Expense ............................................................................................... 36

6. Property Tax Refund .............................................................................................. 43

7. Property Taxes....................................................................................................... 47

8. Renewable Energy Standard (RES) Costs ............................................................ 50

A. Base Level of RES Costs .................................................................................. 50

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B. Amortization of Deferred RES Costs ................................................................ 54

C. Inclusion In Rate Base……………………………………………………………… 54

9. Coal Inventory – Coal in Transit ............................................................................. 56

10. Severance Costs and VS11 ................................................................................... 61

11. Return on Common Equity ..................................................................................... 63

12. Fuel Adjustment Clause ......................................................................................... 73

Should Ameren Missouri’s FAC be Continued ....................................................... 73

A. Should the Sharing Percentage be Changed ................................................... 77

B. MISO Costs in the FAC .................................................................................... 83

13. Storm Costs Tracker .............................................................................................. 93

14. Storm Costs ........................................................................................................... 97

15. Storm Assistance Revenues .................................................................................. 99

16. Vegetation Management and Infrastructure Inspection Tracker ............................ 102

17. Rate Design ........................................................................................................... 108

A. Customer Charge ............................................................................................. 108

B. Declining Block Rate Design ............................................................................ 111

18. EISA Findings ........................................................................................................ 113

Ordered Paragraphs.................................................................................................... 119

The Missouri Public Service Commission, having considered all the competent and

substantial evidence upon the whole record, makes the following findings of fact and

conclusions of law. The positions and arguments of all of the parties have been considered

by the Commission in making this decision. Failure to specifically address a piece of

evidence, position, or argument of any party does not indicate that the Commission has

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failed to consider relevant evidence, but indicates rather that the omitted material was not

dispositive of this decision.

Summary

This order allows Ameren Missouri to increase the revenue it may collect from its

Missouri customers by approximately $260.2 million, based on the data contained in the

Revised True-up Reconciliation filed by the Missouri Public Service Commission Staff on

October 12, 2012.1

Over $100 million of that increase is related to Ameren Missouri’s

increased net fuel costs and would otherwise be recoverd by the company through its fuel

adjustment clause. Another $89 million of that increase is for the cost of increasing

Ameren Missouri’s energy efficiency efforts under Missouri’s Energy Efficiency Investment

Act, MEEIA. Those efforts will enable Ameren Missouri’s customers to take steps to

decrease their usage of electricity and thereby decrease their electric bills.

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