Ameren Subsidiary Announces Reductions in Response to Continuing Declines in Power Markets

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May 03, 2010, 03:33 ET

ST. LOUIS, May 3 /PRNewswire-FirstCall/ -- Ameren Energy Resources Company, LLC (AER), the merchant generation business segment for Ameren Corporation (NYSE: AEE), announced today that it is reducing staff by approximately 75 full-time positions at several power plants and support service facilities in Illinois and Missouri. Affected employees include both management and union-represented workers.

"While it is always difficult to reduce staffing, we believe these reductions are critical to meet the realities of today's depressed power markets. Prices for the power we sell today are far below the levels of earlier years," said AER President and Chief Executive Officer Chuck Naslund.

"We certainly empathize with the employees affected by these reductions and will work to support them during this difficult time," Naslund added. "AER will be offering a range of benefits and resources to affected employees, who will be notified in mid-May."

These staffing reductions, coupled with other planned spending cuts, will reduce net expenses by approximately $20 million in 2010. AER will also be evaluating temporarily ceasing operations at its least efficient plants and taking actions to reduce its benefits costs in the near future.

Today's announcement is unrelated to last week's decision by the Illinois Commerce Commission regarding rates charged by the Ameren Illinois Utilities (AIU). AIU is the regulated business that delivers power to Illinois customers while AER is a separate business.

Within Ameren Corporation, AER is the merchant generation business segment that generates power and sells it throughout the United States. This segment principally includes Ameren Energy Generating Company, AmerenEnergy Resources Generating Company and an 80-percent ownership interest in Electric Energy, Inc.

These staffing reductions follow the elimination of approximately 135 AER positions in 2009.

With assets of approximately $24 billion, Ameren companies serve 2.4 million electric customers and one million natural gas customers in a 64,000-square-mile area of Missouri and Illinois.

Forward-looking Statements

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 elsewhere in this release and in our filings with the Securities and Exchange Commission, 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;
uncertainty as to the continued effectiveness of the Illinois power procurement process;
changes in laws and other governmental actions, including monetary and fiscal policies;
changes in laws or regulations that adversely affect the ability of electric distribution companies and other purchasers of wholesale electricity to pay their suppliers, including Ameren Energy Marketing Company;
enactment of legislation taxing electric generators, in Illinois or elsewhere;
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, such as occurred when the electric rate freeze and power supply contracts expired in Illinois at the end of 2006;
increasing capital expenditure and operating expense requirements;
the effects of participation in the Midwest Independent Transmission System Operator, Inc.;
the cost and availability of fuel such as coal and natural gas used to produce electricity; the cost and availability of purchased power; 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;
prices for power in the Midwest, including forward prices;
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 standards 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;
generation plant construction, installation and performance;
impairments of long-lived assets or goodwill;
the effects of strategic initiatives, including acquisitions and divestitures;
the impact of current environmental regulations on power generating companies and the expectation that more stringent requirements, including those related to greenhouse gases, will be enacted over time, which could limit the operation of our generating units or otherwise have a negative financial effect;
labor disputes, 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;
the cost and availability of transmission capacity for the energy generated by the Ameren companies' facilities or required to satisfy energy sales made by the Ameren companies;
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 Ameren Corporation