Moody's cuts Union Electric, puts Ameren on review

Moody's Investors Service said it downgraded the long-term debt ratings of Union Electric Co., doing business as AmerenUE, and issuer rating to Baa2 from Baa1.

The outlook is stable.

Moody's placed the ratings of Ameren Corp. and AmerenEnergy Generating Co. on review for downgrade, including Ameren's Baa2 issuer rating and Prime-2 rating for commercial paper and AmerenGenco's Baa2 senior unsecured rating.

The agency affirmed Central Illinois Public Service Co.'s Ba1 issuer rating, Cilcorp Inc.'s Ba1 corporate family rating, Central Illinois Light Co.'s Ba1 issuer rating and Illinois Power Co.'s Ba1 issuer rating. The outlook is positive for the four subsidiaries.

"The downgrade of Union Electric Co. reflects declining cash flow coverages; increased operating costs; growing capital expenditures for environmental compliance, transmission and delivery system reliability; and higher debt level being incurred to finance these investments," Michael G. Haggarty, a Moody's vice president, said in a written statement.

The downgrade also reflects the challenging regulatory environment for electric utilities operating in the state of Missouri, the agency added.

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