BRIEF: Ameren to exit merchant generation business
Dec 20, 2012 (Menafn - St. Louis Post-Dispatch - McClatchy-Tribune Information Services via COMTEX) --Ameren Corp. plans to exit the merchant exchange business due to weak power prices.
The utility's Ameren Energy Resources (AER) subsidiary, a holding company based in Collinsville, serves commercial and wholesale power markets through a subsidiary, Genco, and has about 900 employees.
Genco was formed in 2000 in response to an Illinois law that prohibits utilities from owning power plants.
St. Louis-based Ameren said in a regulatory filing Thursday that the merchant exchange business has experienced decreasing earnings and cash flows for several years. In the filing, Ameren also cited environmental regulations that have resulted in significant investment requirements.
Ameren said Genco will likely sell at least one of its three natural gas-fired power plants to improve liquidity.
Ameren spokesman Brian Bretsch said a timeline has not been set for any of the changes, and the announcement has "no immediate impact on Ameren Energy Resources' operations ... or facilities."
Ameren will incur a non-cash charge ranging between 1.5 billion to 2 billion in the fourth quarter related to the decision. The utility's stock shot up nearly 4 percent in afternoon trading Thursday, to 31.17 a share, up from Wednesday's 30.05 closing price.
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