Q3 2025 Ameren Corp Earnings Call
Speaker #1: Greetings . Welcome to Amran s third quarter 2025 Earnings Call . At this time , all participants are in a listen only mode .
Speaker #1: The question and answer session will follow the formal presentation . If anyone should require operator assistance during the conference , please press Star Zero from your telephone keypad .
Speaker #1: Please note this conference is being recorded . At this time , I'll now turn the conference over to Andrew Kirk , Senior Director of Investor Relations and Corporate Modeling .
Speaker #1: Thank you. You may now begin.
Speaker #2: Thank you and good morning . On the call with me today are Marty , our chairman , president and chief Executive Officer . And Michael Maine , our senior executive vice president and chief financial officer , along with other members of the management team .
Speaker #2: This call contains time sensitive data that is accurate only as of the date of today's live broadcast . And redistribution of this broadcast is prohibited .
Speaker #2: We have posted a presentation on the Ameren Investors . Com homepage that will be referenced by our speakers . As noted on page two of the presentation , comments made during this conference call contain may contain statements about future expectations , plans , projections , financial performance , and similar matters which are commonly referred to as forward looking statements .
Speaker #2: Please refer to the forward looking statements section in the news release we issued yesterday , as well as our SEC filings . For more information about the various factors that could cause actual results to differ materially from those anticipated .
Speaker #2: Now , here's Marty , who will start on page four . Thanks , Andrew . Good morning everyone . Before we get into the financials , I want to highlight the strategy that drives our actions and delivers strong long term value for our customers , communities and shareholders .
Speaker #2: Pursuant to this strategy , we've been investing in the electric and natural gas infrastructure of Missouri and Illinois to harden it and make it more reliable , resilient and safer .
Speaker #2: And we've been adding new energy generation resources to meet the needs of our communities today . And in the years to come , because we are committed to providing a strong value proposition for our 2.5 million electric and 900,000 natural gas customers .
Speaker #2: We are also laser focused on optimizing our operations to keep customer rates affordable . As we look ahead , the region and communities we serve are poised for significant economic growth , bringing investment , jobs and tax revenue , as well as necessitating incremental investment in utility infrastructure to support this growth .
Speaker #2: We are actively engaging with stakeholders on economic development opportunities and to advance constructive regulatory frameworks designed to serve new large load customers and maintain just and reasonable rates for all customers .
Speaker #2: We're excited about the opportunities in front of us and believe the future is bright for Ameren and the communities we serve . Michael and I will dive into more details on the pages ahead .
Speaker #2: Now let's turn to page five for a summary of our third quarter results . Yesterday we announced third quarter 2025 adjusted earnings of $2.17 per share , compared to adjusted earnings of $1.87 per share in the third quarter of 2020 .
Speaker #2: For a recent Ferc order provided guidance on Ratemaking for net operating loss , Carryforwards . And as a result , we recorded a tax benefit of $0.18 in the third quarter of 2025 .
Speaker #2: Given the nature of the tax benefit , we have excluded it from our adjusted third quarter 2025 earnings . The key drivers of our strong third quarter results are outlined on this page .
Speaker #2: As we move to page six , I'll cover how execution of our strategy has translated into tangible results for our stakeholders throughout this year .
Speaker #2: During the first three quarters of 2025 , Ameren delivered on its commitments , deploying more than $3 billion in critical infrastructure upgrades for customers .
Speaker #2: For example , as part of our Ameren Missouri 2025 Smart Energy plan , 11,300 Electric distribution poles were replaced , 600 of which were upgraded to stronger composite poles .
Speaker #2: 300 smart switches were installed to reduce outages and speed restoration . 32 miles of Subtransmission lines were hardened . Five new or upgraded substations were energized , and 55 miles of underground cable were replaced .
Speaker #2: To strengthen system reliability in Illinois . Our customers are benefiting from the replacement of more than 8500 stronger electric distribution poles , eight miles of coupled steel gas distribution pipelines and 13 miles of gas transmission pipelines for safety .
Speaker #2: Further , our transmission business placed in service 11 new or upgraded transmission substations and 40 miles of new or upgraded transmission lines to deliver energy more efficiently .
Speaker #2: These are just a few of the many projects completed through September . We also continue to execute on Ameren Missouri's preferred Resource Plan .
Speaker #2: As you know , we updated this plan in February to reflect the growing energy needs of our customers and communities , including during extreme weather conditions .
Speaker #2: The plan calls for the addition of approximately ten gigawatts of generation capacity by 2035 , including 3.7GW of natural gas generation , 4.2GW of renewables and 1.4GW of battery storage .
Speaker #2: Through September , we've invested more than $825 million in new or existing generation resources and have requested from the Missouri Public Service Commission for 1.45GW of additional resources in 2025 .
Speaker #2: We also made the decision to spend more on operating and maintenance by accelerating certain tree trimming and energy center maintenance activities . All of these efforts underscore our commitment to delivering reliable energy for the long term .
Speaker #2: And as you know , our electric rates remain below both national and Midwest averages . The testament to our unwavering focus on continuous improvement and affordability .
Speaker #2: Now let's turn to page seven. We have a long track record of strong and consistent earnings per share growth. As we look ahead, we expect this to continue in February of this year.
Speaker #2: We updated our long term earnings growth guidance , which included our expectation to grow earnings at a 6 to 8% compound annual rate from 25 through 2029 , based off of our 2025 original guidance , midpoint of $4.95 for 2025 , we expect adjusted diluted earnings per share to be in the range of $4.90 to $5.10 , up from our original guidance range of $4.85 to $5.05 .
Speaker #2: We're well positioned to continue our long history of delivering above the midpoint of our original earnings guidance range for 2026 . We now expect diluted earnings per share to be in the range of $5.25 to $5.45 , and we expect consistent earnings growth near the upper end of our 6 to 8% EPs compound annual growth rate range in 2027 through 2029 .
Speaker #2: Consistent with prior years , we plan to update our long term earnings growth guidance on our fourth quarter call in February 2026 , including our five year capital and financing plans , which will reflect , among other things , firmed up capital estimates related to Ameren Missouri's preferred resource plan .
Speaker #2: Turning to page eight , I'll provide an update on economic development activities in our region and associated sales growth expectations . We remain closely engaged with potential data center customers and are building a robust pipeline of large load opportunities that extend into the next decade .
Speaker #2: Data centers represent significant private investment opportunity for our states , bringing in thousands of jobs and fields such as construction , plumbing , electrical work and technology , as well as substantial tax revenue .
Speaker #2: As we discussed on our earnings call in August, data center developers continue to evaluate opportunities in Missouri given the numerous desirable construction sites in our territory, available transmission capacity, and our ability to deliver power when needed at competitive rates.
Speaker #2: As a result of this engagement , Ameren Missouri's executed construction agreements with data center developers have expanded to three gigawatts , up from the previous total of 2.3GW .
Speaker #2: The developers of the data center sites with construction agreements in place , have now made non-refundable payments to us , totaling $38 million to cover the necessary transmission upgrades , and which demonstrates their confidence in and commitment to the proposed projects .
Speaker #2: We also continue to actively engage with potential data center customers to negotiate electric service agreements that are aligned with our proposed Missouri Large Load Rate structure , and , among other things , would establish anticipated minimum ramp schedules .
Speaker #2: I'll talk more about progress on that large load rate structure in a few minutes . As outlined in Ameren Missouri Preferred Resource Plan , we expect one gigawatt of new load from data center customers by the end of 2029 , and a total of 1.5GW of new data center demand by the end of 2032 .
Speaker #2: To give you a sense of the proportions , one gigawatt of new data center load by 2029 would represent approximately 5.5% compound annual Missouri sales growth from 2025 .
Speaker #2: In addition , we're seeing notable expansion in the region's defense and geospatial intelligence ecosystem , which is stimulating growth across multiple sectors , including advanced manufacturing .
Speaker #2: One such example is the opening of the National Geospatial Intelligence Agency's new , nearly $2 billion campus in Saint Louis . This September .
Speaker #2: The campus , which employs more than 3000 people , represents the largest federal investment in Saint Louis history . Private sector participation is also strong , with companies like scale AI choosing to locate their headquarters downtown .
Speaker #2: The presence . In Saint Louis of federal and private sector geospatial operations , including advanced mapping , satellite imagery and spatial analytics , strategically aligns with our region's strength in defense and defense tech industries .
Speaker #2: Looking ahead, Boeing has begun construction of new facilities to build the F-47 fighter approved earlier this year. Production of the F-47 is scheduled to start in 2026.
Speaker #2: These developments further strengthen Saint Louis position as a national hub for innovation and strategic investment in downstate Illinois . Developers are also advancing data center projects with expected incremental energy demand totaling 850MW .
Speaker #2: We have signed construction agreements with these developers and received payments to support the necessary transmission interconnections . Energy supply for these projects is expected to be provided through third party supply agreements .
Speaker #2: We expect to provide an update on our Missouri and Illinois five year sales growth expectations in February . Moving now to page nine .
Speaker #2: We provide an update on generation resources currently in progress at Ameren Missouri. We have procured long lead-time components such as turbines and transformers for our planned energy centers.
Speaker #2: With expected in-service dates through 2029 . And we have secured production slots for the three turbines for our combined cycle energy center , expected to be in service in 2031 .
Speaker #2: Remaining on track to deliver the dispatchable resources called for in our preferred resource plan in August , we requested a certificate of convenience and necessity for the reformed Solar Energy Center , a planned 250 megawatt solar facility to be located adjacent to our existing Callaway Nuclear Energy Center .
Speaker #2: Generation projects with CCN requests pending before the Missouri Public Service Commission will support progress toward our goal of maintaining a balanced energy mix .
Speaker #2: We're targeting approximately 70% generation from on demand resources and 30% from intermittent resources . By 2040 . Ameren Missouri planned generation portfolio is expected to provide an estimated $1.5 billion in customer savings from tax credits through 2029 , of which approximately $270 million has been realized so far in 2025 .
Speaker #2: Building, maintaining, and operating a sufficient and optimal mix of energy centers to meet our customers' needs in an affordable manner is critical for our stakeholders, and I'm proud of the work our team is doing in those regards.
Speaker #2: On page ten , we outline Ameren Missouri's proposed large load rate structure , which was filed with the Missouri PSC in May and updated in rebuttal testimony earlier this week .
Speaker #2: In accordance with Missouri state law . Any future large load data center customers would be required to pay for costs to connect them to our system and for their share of ongoing cost of service .
Speaker #2: Under the proposed large load rate structure , we would deliver service under our existing large primary service base rate , which is currently approximately $0.06 per kilowatt hour , and customers would agree to additional terms and conditions as part of an electric service agreement .
Speaker #2: The additional terms would include a service commitment of 12 years after ramp , a minimum demand charge of 80% of contracted capacity , exit provisions and credit and collateral requirements , all designed to protect existing customers .
Speaker #2: In addition , new customer programs would be available that would allow qualifying customers to advance their clean energy goals by supporting the carbon free energy resource of their choice through incremental payments , which would help offset costs for other customers .
Speaker #2: This structure would offer a fair and competitive rate to large customers and maintain just and reasonable rates for all customers . While no deadline exists for Missouri PSC , approval of our proposed large load rate structure based on the existing procedural schedule , we would expect a decision by February of 2026 .
Speaker #2: Moving now to page 11 for an update on the long range transmission planning process at Miso . Our focus remains on building the LRP tranche one and tranche 2.1 projects that were assigned to us and developing strong proposals for tranche 2.1 competitive projects .
Speaker #2: We are carefully evaluating each bidding opportunity and will submit bids for projects when we believe we offer a clear advantage on project design, cost, and execution.
Speaker #2: As we have successfully done in the past , when it enhances the strength and competitiveness of our proposals . We expect to partner with other entities .
Speaker #2: For example , in August we submitted a joint proposal with three other partners on a tranche 2.1 competitive project in Wisconsin . We expect myself to select the developer for this project in early 2026 .
Speaker #2: The bidding and selection process for the four remaining Tranche 2.1 competitive projects will continue to take place over the remainder of this year and next.
Speaker #2: As a reminder , we do not include investment related to competitive projects in our five year plan . Until projects have been awarded to us .
Speaker #2: Further, Miso continues to analyze increasing energy demand and updated resource mix assumptions across the region as part of the futures redesign process.
Speaker #2: We expect this analysis will show the need for significant incremental transmission investments that would benefit the wider Miso region over time . Miso is expected to issue its report in early 2026 .
Speaker #2: Moving now to page 12 . Looking ahead over the next decade , our pipeline of investment opportunities continues to grow . Standing today at more than $68 billion .
Speaker #2: We will provide further details in February as to the planned capital investments expected for the period of 2026 through 2030 and the associated financing plan .
Speaker #2: These investments will deliver significant value to all of our stakeholders by making our energy grid stronger , smarter and cleaner , and by powering economic growth in our communities .
Speaker #2: Turning to page 13 . In February , we updated our five year growth plan , which included our expectation of 6 to 8% compound annual earnings growth from 2025 through 2029 .
Speaker #2: This earnings growth expectation is primarily driven by strong anticipated compound annual rate base growth of 9.2% , reflecting strategic allocation of infrastructure investment to strengthen the grid .
Speaker #2: Each of our business segments and to build new energy resources to meet increased demand , we expect to deliver strong long term earnings and dividend growth , resulting in an attractive total return .
Speaker #2: I'm confident in our ability to execute our investment plan and our broader strategy across all four of our business segments , as we have a skilled and experienced team dedicated to achieving our growth objective while keeping customers at the center of everything we do .
Speaker #2: Now , before turning the call over to Michael , I'd like to briefly share a leadership update . Effective January 1st , Michael will assume the role of group president of Ameren's utilities , overseeing the operations of each of our business segments .
Speaker #2: Michael is an experienced leader , bringing to this newly created position deep financial and broad operational expertise , qualities that will continue to support our focus on delivering value for customers and shareholders .
Speaker #2: When Michael transitions to this new role , Lenny Singh , currently chairman and president of Amarillo , Illinois , will transition into the role of executive vice president and chief financial officer .
Speaker #2: Lenny has nearly 35 years of utility leadership experience with substantial operational , regulatory and profit and loss responsibilities . These experiences will ensure we continue to practice financial discipline , align with our regulatory frameworks and deliver value for our customers and shareholders .
Speaker #2: I'm pleased with the strength and alignment of our leadership team and believe these changes position us well for continued execution of our strategy and strong performance .
Speaker #2: With that , I'll hand the call over to Michael . Thanks , Marty , and good morning , everyone . Turning now to page 15 of our presentation .
Speaker #2: Yesterday we reported third quarter 2020 GAAP earnings of $2.35 per share , which included a tax benefit related to our Ameren transmission segment .
Speaker #2: This tax benefit was recorded due to IRS guidance and a Ferc order issued to another taxpayer regarding treatment of net operating loss . Carryforwards .
Speaker #2: Pursuant to this guidance . This quarter , we decreased income tax expense by $48 million , or $0.18 per share . Excluding this benefit , third quarter 2020 adjusted earnings were $2.17 per share compared to adjusted earnings of $1.87 per share for the third quarter of 2020 .
Speaker #2: For the key factors that drove the 30 cent increase in adjusted earnings per share are highlighted by segment on page 16 and reflect the important investments we've made to strengthen the energy grid across our service territory .
Speaker #2: In addition to benefiting from new electric service rates in Missouri and warmer-than-normal weather in July, we continue to experience strong sales growth within the Ameren Missouri service territory.
Speaker #2: In fact , total normalized Missouri retail sales over the trailing 12 months through September increased across all customer classes , with an overall increase of approximately 1.5% .
Speaker #2: Further , in light of the benefit from weather this year and to support stronger reliability , we've increased energy center and discretionary tree trimming expenditures .
Speaker #2: The latter in targeted areas to address vegetation growth near power lines . Moving to page 17 . Since 2013 , we delivered strong , consistent , normalized adjusted earnings per share growth of greater than 7.5% .
Speaker #2: Compounded annually . Yesterday , we increased our 2025 earnings per share guidance range of $4.90 to $5.10 . The midpoint of the new range represents approximately 8% growth compared to both our original 2024 earnings guidance range , midpoint and our 2024 results outlined on the page are select earnings considerations for the fourth quarter of 2025 , which I encourage you to take into consideration as you develop your expectations for the balance of the year .
Speaker #2: Moving to page 18 , we provide detail on our 2026 earnings per share expectations , which we also announced yesterday . We expect our 2026 earnings per share to be in the range of $5.25 to $5.45 .
Speaker #2: The midpoint of which represents 8.2% growth compared to our 2025 earnings guidance . Midpoint of $4.95 . Expected 2026 earnings details by Segment .
Speaker #2: Compared to our 2025 expectations are highlighted on this page . Robust planned infrastructure investment strong expected sales and economic growth , and strategic business process optimization opportunities give us confidence in our ability to grow earnings in 2026 .
Speaker #2: In the years ahead . Now , turning to our financing plan on page 19 . To support our strong credit ratings and maintain our balance sheet while we fund our investment plan in February , we outlined a plan to issue a proximately $600 million of common equity each year through 2029 .
Speaker #2: We have fulfilled our equity needs for 2025 and 2026 through forward sales agreements that we expect to physically settle near the end of these years .
Speaker #2: Having utilized most of the capacity available under our existing equity sales distribution agreement in August, we increased the program capacity by $1.25 billion to enable additional sales to support equity needs in 2027 and beyond.
Speaker #2: And in September , Ameren Illinois issued $350 million of 5.625% first mortgage bonds due 2055 . Completing our planned debt . Debt issuances for this year .
Speaker #2: We feel great about our financial position and the progress we've made in our financing plan . Turning to page 20 . We'll provide a brief update on ongoing regulatory proceedings in Illinois .
Speaker #2: Our Illinois Natural gas distribution rate review is pending with the Illinois Commerce Commission , or ICC , and we expect a decision this month .
Speaker #2: As a reminder , we have requested $135 million annual base rate increase in October . The Administrative Law judge , or ALJ , recommended an annual base rate increase of $91 million based on a 9.93% return on equity and a 50% common equity ratio .
Speaker #2: The difference is primarily driven by a ROE . The common equity ratio and the treatment of other post-employment benefits . Following the ICC's decision , we expect rates to be effective in December .
Speaker #2: Turning to page 21 . Our 2024 Annual reconciliation proceeding under the electric Multiyear Rate plan continues to progress . In September , the ICC staff revised its reconciliation adjustment recommendation to a $47 million increase compared to our updated request of $60 million .
Speaker #2: With the variance primarily driven by treatment of other post-employment benefits . The LGA recommendation and the reconciliation proceeding is expected later today in ICC .
Speaker #2: Decision is expected by mid-December and rate reflecting the approved reconciliation adjustment will be effective by January 2026 . Turning now to page 22 .
Speaker #2: Our strong performance so far this year has positioned us well to continue executing our strategic plan , which will drive superior value for all of our stakeholders .
Speaker #2: We continue to expect strong earnings per share growth to be driven by robust rate base growth , disciplined cost management and a strong customer growth pipeline .
Speaker #2: Our strategy and team are well aligned and focused to ensure we capitalize on these opportunities for our customers and shareholders . We believe our growth will compare favorably with the growth of our peers and further continue to offer investors an attractive dividend .
Speaker #2: In total , we have an attractive total shareholder return story . That concludes our prepared remarks . We now invite your questions .
Speaker #1: Thank you . We'll now be conducting a question and answer session . Would you like to ask a question at this time ? You may press Star one from your telephone keypad .
Speaker #1: And a confirmation tone indicate your line is in the question queue . You may press star two . If you'd like to withdraw your question from the queue for participants using speaker equipment , it may be necessary to pick up your handset before pressing the star key's one moment , please .
Speaker #1: For our first question . Thank you . And our first question is from the line of Jeremy Tonet with J.P. Morgan . Please proceed with your questions .
Speaker #3: Hi . Good morning . This is Diana Niles , actually on the call for Jeremy .
Speaker #2: Hey . Good morning .
Speaker #3: So good morning . So I was wondering , with three gigawatts of signed data center construction agreements , would you foresee a need for future revisions to generation plans ?
Speaker #2: Yeah , it's a it's a great question . Yeah . We're very excited to have expanded the , you know , data centers that we have subject to construction agreements , as you know , last quarter , we were at about 2.3GW .
Speaker #2: And now we're up to about three gigawatts . And I'll tell you , it , it's great because it gives us even greater confidence .
Speaker #2: And , you know , the sales projections that we put forward earlier this year , you know , you'll recall that embedded in the integrated resource plan was about a gigawatt of sales increased by 2029 out to a gig and a half by 2032 .
Speaker #2: And as you can see on the slide that we presented in our materials , slide eight . You know , the current generation plans that we have in place would allow us to serve up to two gigawatts of increased sales out through 2032 .
Speaker #2: So , you know , number one , this three gigawatts of construction agreements gives us greater confidence that we'll be able to achieve the sales growth expectations that we've got .
Speaker #2: And over time , we'll see what what how these translate into actual ramp rates for the hyperscalers . That would utilize these data centers .
Speaker #2: So , you know , as you know , we're working to get a tariff across the finish line with the Missouri Public Service Commission .
Speaker #2: Then we'll sign Energy services agreements with hyperscalers pursuant to that tariff . Those energy services agreements will lay out what the hyperscalers expect to have to be their minimum ramp rates over time .
Speaker #2: And , you know , with that , we'll we'll see where we land within these projections that we show on on page eight .
Speaker #2: Now , I will say that the current generation plans that we do have allow us to serve greater than two gigawatts beyond 2032 .
Speaker #2: So we'll really have to see what those ramp rates look like over time and what that means for added generation capacity over time .
Speaker #2: But again , the current plans that we have in place , the current plans that we're executing for generation expansion would allow us to serve up to that two gigawatts by 2032 .
Speaker #2: Yeah . The only thing I might add to that is , you know , as we go through 26 , as Marty indicated , we'll have another opportunity to look at this IRP .
Speaker #2: We'll have an filing probably in the fall , around September of 26 . So that's something to keep an eye on as well .
Speaker #2: Yeah . Great point Michael . Thanks for the question .
Speaker #4: Great .
Speaker #1: The next question is from the line of Nick Campanella with Barclays . Please proceed with your questions .
Speaker #5: Hey good morning and congrats to Michael and Lenny on the new roles .
Speaker #2: Hey thank you .
Speaker #5: I it . Yeah , absolutely . So , hey , I just wanted to ask , you know , you're delivering on an 8% year over year growth off of you know I hear you on the communication upper half of the earnings range .
Speaker #5: But just given you know you've had some companies kind of moving out to 7 to 9 . You know , what's your view on just what puts you lower in that 6% range now .
Speaker #5: And could that be up for kind of consideration as we look towards 25 .
Speaker #2: You know ,
Speaker #2: start . And you know , Michael can certainly tag on . But you're And right . You know , the guidance we gave today obviously , you know , we're delivering earnings this year and projecting earnings next year .
Speaker #2: That are in the top end of that range . As we look to 27 to 29 . Continue to expect to be in the top end of that 6 to 8% earnings growth range .
Speaker #2: So we feel really good about the growth that we've been achieving and the growth that we project over , over the next several years .
Speaker #2: You know , I think as we look ahead , you know , we've got some important things that will really solidify our plans .
Speaker #2: The most notable one we just talked about in response to the last question , which is really getting the tariff approved by the Missouri Public Service Commission and getting these energy services agreements signed .
Speaker #2: But with the hyperscalers and really getting some , you know , better firmness , if you will , to the ramp rates and to the sales projections that we see between now and 2030 .
Speaker #2: So we roll around to February , obviously , we're going to update our , our sales growth expectations . We'll update our CapEx , our rate base growth expectations , as well as our financing plans and and , you know , update our growth guidance .
Speaker #2: So , you know , right now I feel real good about the 6 to 8 . Feel real good about delivering near the upper end of that .
Speaker #2: That growth range . And and look , we won't constrain the growth . You know , we're looking for economic development and all of the regions , the communities that we serve in Missouri and Illinois and certainly don't want to constrain that .
Speaker #2: And if that translates into greater investment opportunities and greater growth opportunities for us , you know , certainly will will pivot with that .
Speaker #2: Yeah , not not much to add there . I mean , as Marty said , I mean , you look at what we did here for 25 .
Speaker #2: I mean , it's again 8% off of 24 . You know what we introduced for 26 is again , 8.1% off of that 4.95 midpoint .
Speaker #2: I think it's a fair question . As Marty said , we'll continue to evaluate it . I mean , I think all of this is just consistent with the track record that we've had now for what is it , 12 , 13 years , you know , 7.5% growth .
Speaker #2: And we're continuing to focus on , you know , on delivering the upper half of that .
Speaker #5: Understood . Not going to constrain the growth rate . All right . And then maybe just as we prepare for the fourth quarter update , maybe how are you framing balance sheet capacity to serve some of the load and CapEx .
Speaker #5: And just you know , you've always kind of operated at FFO level . That is , you know , north of your peers .
Speaker #5: But I'm just curious. One is the increased sales forecasts a net benefit to cash flow, and thus should equity needs be lower?
Speaker #5: And then two , just any interest in using some balance sheet capacity relative to your minimums . Thanks .
Speaker #2: Yeah , absolutely . And look , I mean , obviously all the sales growth is accretive over time . I think we do have to get , you know , these ramp schedules and get all that timing nailed down .
Speaker #2: But certainly look forward to that . And I think we've talked about these tax credits that were flowing back to customers . There was , you know , a brief period of time where those were helpful as well .
Speaker #2: But look , Nick , I mean , we started this from a position of strength , as you know , I mean , we're sitting at Barwon triple B+ that Moody's is really that threshold metric for us .
Speaker #2: It is a 17% downgrade threshold today . I mean , we're operating above that here in 25 . So we got good margin above that .
Speaker #2: You know we continue to guard this balance sheet . I mean we've been very disciplined about the equity that that we needed over time and been very good about getting it out there .
Speaker #2: And again , as you know , we've taken care of all of our 25 and 26 needs . You know , we continue to have very constructive conversations with the rating agencies about sort of where that downgrade threshold will be .
Speaker #2: You know , we'll see over time where those conversations continue to go . We have been leaning into the balance sheet , as you know , but , you know , it's a balancing act .
Speaker #2: But we do like our position where we are today and feel good about what we have. We will continue to give you updates as we move into that February call.
Speaker #5: Thank you .
Speaker #2: Thanks , Nick .
Speaker #1: The next question is from the line of Carly Davenport with Goldman Sachs . Please proceed with your questions .
Speaker #6: Hey , good morning . Thanks for taking the questions . Maybe on maybe on the data center front , just with the construction agreements now at the three gigawatt level , is there anything you can share on that delta just in terms of how many customers that change is attributed to ?
Speaker #6: And then I think there previously was an indication on the slides that you expected the ramp to begin in late 2026 . Has that view changed at all ?
Speaker #6: Just curious how we should think about that .
Speaker #2: Yeah , Carly , we're really expecting the ramps to to begin in 2027 . At this point . So , you know , not so much in 2026 .
Speaker #2: So as we've , worked through this , a bit of delay there . But you know nothing discouraging overall as we talked about , you know , up to the three gigs of construction agreements , you know , Carly don't have it in front of me .
Speaker #2: But I think that's one additional site. I mean, these are big. These are big sites that folks are looking at.
Speaker #2: I'll tell you that , you overall , you know , when you look at the development pipeline , we have , you know , we talked about this last year , you know , just a still a large number of sites being looked at in data center developers .
Speaker #2: I'd say at a minimum , kicking the tires . We've got across the two states , you know , about 36GW of economic development opportunities broadly .
Speaker #2: And it breaks down about half and half . So think about 18GW in each state , Illinois and Missouri . Now , you know , in about 80 to 90% of those are data centers .
Speaker #2: By the way . But , you know , in most of those are in the early stages of of looking at the various sites .
Speaker #2: But I will tell you , in Missouri , in addition to the three gigawatts of signed construction agreements , there's another two gigawatts .
Speaker #2: Considerations that are , you know , I'd say advanced stages of discussion . So , you know , there are folks still looking very seriously at sites and considering , you know , entering into construction agreements , you know , there as well , over in Illinois , by the way , I think , you know , I mentioned in the prepared remarks , we've got , you know , some construction agreements as well , about 850MW of large load was construction agreements .
Speaker #2: So , you know , some good , good progress , really , in both states . Did I answer all your questions , Carly , or was there something else there ?
Speaker #6: Nope . That that covered it . Thank you . That's really helpful . And then maybe just to follow up on on Illinois , just with the omnibus energy bill passing over the last couple of weeks here , just kind of curious , your early views on any sort of implications for the business there ?
Speaker #2: Yeah . You know , overall , we were , you know , neutral on Senate Bill 25 that passed in the in the veto session , although I think that , you know , I probably highlight three things .
Speaker #2: And there were a number of things in this bill that go beyond the three things I'd cite . But , you know , one of them was that it does call now for an integrated resource planning process to be done at the ICC .
Speaker #2: I think it's the first time that we've really had integrated resource planning in states since 1997 . So I think that is a positive thing that the state's going to be looking at integrated resource planning holistically .
Speaker #2: And , you know , my expectation is sort of utility by utility , region by region . But I think that's a good thing .
Speaker #2: And certainly we'll look to engage there as the ICC gets that process underway in 2026 . You know , the other thing I think driving this is that , you know , certainly there's been , you know , concern as folks think about resource adequacy across the state .
Speaker #2: And also want to be mindful of the clean energy goals that the state has . And so , you know , a couple of other things that I'd mentioned is that it does establish an energy storage procurement process across the state .
Speaker #2: And also gives the Illinois Power Authority the ability to enter into long term contracts for renewables . And , you know , all of those things are going to be subject .
Speaker #2: They'll they'll occur over time and they'll all be subject to consumer protections that are built into the legislation . But but again , processes that lawmakers believe over time will reduce the price of capacity .
Speaker #2: And help to keep volatility and cost under control for for customers as it relates to energy and capacity . And then the third thing I'd mention is increased investment in energy efficiency , which is something we we does involve us , that we partake in .
Speaker #2: You know , over time , we'd expect our investment in energy efficiency on behalf of our customers to , to double to about $250 million a year .
Speaker #2: All of that would continue to be subject to treatment as a regulatory asset and recovery over time, with the return. I will tell you that the return there is being reduced down to the return that was granted as part of the multi-year rate plan.
Speaker #2: However , we have the opportunity to earn up to 200 basis points of incentives and we believe with the the spending that's called for as well as the metrics to be achieved , that we have a very good opportunity to earn incentives that would be additive to that ROE .
Speaker #2: So , you know , those are the three things that I'd really call out . There were some other provisions to the bill , but , you know , those are the things I'd highlight .
Speaker #6: That's really helpful . Thank you very much .
Speaker #1: Thank you . The next question is from the line of Julien Dumoulin-smith with Jefferies . Please proceed with your questions .
Speaker #7: Yeah . Hi . Good morning . It's Brian Russo on for Julien .
Speaker #2: Hey , Brian .
Speaker #7: Hey . Just a follow up on the the clean grid reliability , grid Affordability Act in Illinois . Do you are there anything in that bill that could lead to incremental investments for the Ameren utilities ?
Speaker #7: You know , whether it's , you know , indirectly through transmission and distribution , maybe less or so on on the storage opportunities .
Speaker #7: Just wondering if you could provide more specifics there .
Speaker #2: Yeah , Brian , good question . I think the , you know , really the probably the biggest opportunity , if you will , is in that energy efficiency space where again , you know , we do treat that as a regulatory asset .
Speaker #2: So it does get sort of you know rate based treatment in there . We do expect the investments in energy efficiency , as I said a moment ago , to double over time to about $250 million a year .
Speaker #2: But , you know , I'd say that's the only notable thing from a real investment opportunity standpoint .
Speaker #7: Okay . Understood . And then also on the last earnings call , you know , you had mentioned existing data center customers requesting more studies , you know , to pursue possible expansions .
Speaker #7: And I think there was about 1.7GW of , existing customer expansion sited in some of the large tariff testimony is that incremental to the three gigawatts ?
Speaker #7: Is that correct ?
Speaker #2: Yeah , it is . I think that again , with with respect to the three gigawatts of construction agreements , you know , we we still don't know what the ramp rates are going to be with respect to the hyperscalers there .
Speaker #2: So , you know , again , some of that growth could be between now and say , 2030 , or it could be beyond , we'll just have to wait and see .
Speaker #2: But but again , to your question and I said a few minutes ago decides that three gigawatts of sign construction agreements , another we got another two gigawatts that are in very advanced stages of discussion in Missouri , which would bring it to five overall .
Speaker #2: And again , the overall sort of funnel , if you will , of of data center opportunities is much more significant because , again , you know , we're looking at , you know , about 18GW of overall economic development opportunities in the pipeline .
Speaker #2: So there's a lot of a lot of other sites for data center developers to to consider and to pursue . And as we talked about in the last call , the conversations with the hyperscalers are progressing very well with respect to the energy services agreements .
Speaker #2: That would be pursuant to this tariff . And it's those hyperscalers that are also inquiring about these expansion opportunities that would be available to them .
Speaker #2: After we sign these ESAs and serve their initial needs . You know , they're certainly looking at expansion opportunities beyond that . And again , we've got plenty of sites in our part of Missouri to accommodate .
Speaker #7: All right . Great . Thank you very much .
Speaker #1: Our next question is from the line of Paul Patterson with Glenrock Associates . Please proceed with your questions .
Speaker #8: Hey , good morning .
Speaker #2: Hey , Paul . Paul .
Speaker #8: It sounds to me I apologize . I got slightly distracted when you were talking to Nick , but just to sort of summarize his question about the the earnings , it sounds like you guys are sort of being conservative now .
Yeah, I I, I'd go into it. Looking at it more as a neutral. Um, I do think that there's, um, um, you know, from an Roe perspective, I do think that over time, as I said before, there's opportunity for incremental investment, uh and you're absolutely right. Uh we have a good track record of execution over all of the company and we're going to look to execute well on these Energy Efficiency programs for the benefit of our customers. Uh, I think that's what is expected of us. And uh if we do that, well then we'll have the opportunity to earn the incentives that are in there. But uh, you're right, I mean, we're there's some opportunity in their
I I think about the overall Roe affect is being more neutral, some good investment opportunities. And uh certainly we're going to try to maximize the impact for the benefit of our customers.
Okay. Great, thanks so much guys.
You bet.
Next questions are from the line of David, pause with wolf research, please just use your questions.
Hey, good morning.
Good morning. Um,
Clarifications here. Uh first, how should we think of the 5 billion dollar increase in your tenure capital?
Plan pipeline. Um, as we see here today, is that back-end loaded, or could we see the bulk of that in the 26 to 30 update?
Hey David, it's Michael. Yeah. Local obviously, we give you some more visibility on that here in the February time frame. As you know it I mean there there is a 5 billion dollar increase their, I think Marty alluded to some of that. I mean, I wouldn't say it's 1 thing. It's a number of things in terms of, kind of confirming up some of this generation, which, you know, is a bit back-end loaded, but there are other things in terms of just investing in the grid and continue to build out, you know, reliability, making sure that we're making Investments, that are benefiting customers, Etc. I mean, we have a massive service territory 64,000 square miles. A million polls, thousands of substations.
Uh, Etc. And so as we continue to go through time and look at those opportunities. Uh, those are all things that are being accreted to the capital plan. Technology is also an opportunity here as we continue to invest in systems. Um, those are also leading to some increases as well. So, not 1 thing I can point to, but we'll certainly give you a visibility on, you know, the years as we roll forward into February, but, um, you know, some great opportunities in terms of the overall pipeline
okay, and then, just on the
Sessions. Like, can you break that down by Missouri and Illinois?
Oh hey, hey, David you're back. We we missed that question. Could you repeat it again? Sorry we had a technical issue.
Sure.
You gave a a number that was in advance discussions. Just can you break that down between Illinois and Missouri?
I hate to do this to you. Hey, hey, hey, David. I I'm gonna try to answer the question. I think you're asking, but you may need to ask it again. You, you cut out twice. I think you're talking about sort of advanced discussions on the data centers, uh, and when I talked about the, uh, 2 gigawatts of of discussions that were sort of advanced those, those were in Missouri. So we've got, you know, 3 gigawatts of signed construction agreements, another 2 gigawatts in advanced stages of discussion. If that didn't answer your question or you have more, why don't you repeat it again? Thank you.
No, I think we're having a technical. Sorry about that. Um,
Noticing it elsewhere, too. But anyway, yeah, that was the answer. It sounds like these are the 2 gigawatts that were in advanced discussions. Um, and then maybe just one quick one.
you know, obviously we've heard from some um, in the state Missouri on on new large load and affordability, just maybe if you can elaborate on on the regulatory political engagement, you have
You have there and and then touch on how those conversations might look in Illinois near wires only business. Thank you.
Yeah. So you know in Missouri I would say the uh state is uh very supportive and encouraging of uh Economic Development and including uh data center development and data center retraction. And so the state certainly wants to uh uh realize uh, those opportunities. Um, you know, certainly there are certain communities that uh, you know, have expressed concern around, you know, various things, uh, water usage noise, uh, electricity rates. Uh, and the like, uh, things that, uh, you know, have to be addressed as we go through the, the process of getting these, uh, you know, data centers, approved and built. Uh, and I think those, uh, concerns can and are being addressed and of course, these data center opportunities bring with them, as we said earlier. Uh, you know, tremendous investment, uh, a lot of jobs.
And that was actually, you know, 1 of the focuses of, uh, Senate, Bill 4, 4 earlier this year in Missouri, uh, where again, they embedded in that, uh, requirement that the Missouri Public Service Commission as they think about the Tariff, uh, that would be approved to serve these, uh, to make sure that, uh, again, uh, there was reasonable assurance that the rest of the customers were not being harmed by, uh, these data centers. And so, you know, David when we filed our, our tariff with the uh, commission. Um, you know again we outline the components of that on slide 10. It was really designed to um,
You know, make sure that, uh, we were, uh, designing the Tariff and charging, uh, the hyperscalers a rate, uh, which would be, uh, in accordance with Senate, Bill 4 and the provisions that I, I just talked about. And, and I think that's been a concern of, of, some of our elected officials, just making sure that we weren't providing the discounted rate that we were providing a rate that, uh, held the rest of our customers harmless that. You know, there weren't costs included in rates for our existing customers that, uh, were associated with service to these, uh, uh, large load customers. So, you know, I think that's sort of the balance of of concerns that are out there, but back to your, your point overall, uh, the state is very supportive and very Desiring of these Economic Development opportunities. Uh, we're certainly working in concert with, uh, you know, the
State, uh, as well as, uh, economic development organizations, across the state to to bring these fruition in our service territory. And uh, we're going to try to do this the right way where, um, you know, we make sure that, uh, uh, there are rewards that are brought to, uh, the communities that we serve and in, in terms of the economic development opportunities and that from a rates perspective, uh, these customers pay their fair share and the rest of our customers, uh, you know, are not harmed by, uh, uh, you know, by their usage,
Thank you.
Our final question is from the line of Steve debris with RBC Capital markets.
Just to see if there are questions.
I'm Marty, I'm Michael. Uh, good morning and thanks for taking my question and congrats to Marty and Lenny on the new rules. Uh, Michael and excuse me, um, just uh, really quickly. Uh, yeah, slow morning, uh, really quickly, um, on, on the on, you know, there's been some questions about Illinois legislation. But I thought, you know, given we're, we'll probably see some bills get pre-filed in December in Missouri. I was wondering if there's any legislative priorities that you guys are advancing, or if there's anything we should be, you know, legislative topics that you think will be, uh, you know, pertinent or come up kind of in the the bill pre-filing in December. Thanks.
Yeah. Yeah, nothing to comment on specifically. Steve, I mean, obviously, you know, we've continued to improve the environment there, you know, appreciate what the legislature's done. I mean the commission continues to be a very thoughtful and forward-looking, I mean, trying to find ways to provide the right incentive for investment. But at the same time, continue to balance out with customer impact. So, you know, I anything that would occur, uh, over the next, you know, couple of months my, my sense is would be, you know, constructive and balanced. And what we'll see what uh, what time brings yeah. As you know, the pre-filing is December 1st and so beyond that it's, you know, probably a bit premature to get into the details.
All right, I appreciate it. Thanks very much for taking my question. Have a great morning. All right. Yep, you too. Thanks. Steve.
Thank you. This now, concludes our question and answer session. I'd like to turn the floor back over to, Marty Lyons for closing comments.
All right. Well, hey thanks to everybody who joined us this morning, a lot of great questions, a lot of great dialogue. As you can tell, we remain absolutely focused on strong execution of our plan and we will continue to do that for the remainder of this year. And into next, uh, as we work to really diligently, you know, serve our customers and deliver safe reliable and affordable energy. So again thank you all for joining us. I'm sure we'll see many of you at the upcoming eei Financial conference. Uh, and with that, I have a great uh have a great day and a great weekend.
Ladies and gentlemen, thank you for your participation. This does conclude today's teleconference, you may now disconnect your lines and have a wonderful day.