Greetings and welcome to Ameren Corporation's Second Quarter 2023 Earnings Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Andrew Kirk, Director of Investor Relations for Ameren Corporation. Thank you, Mr. Kirk. You may begin.

Thank you and good morning. On the call with me today are Marty Lyons, our President and Chief Executive Officer; and Michael Moehn, our Senior Executive Vice President and Chief Financial Officer, as well as the other members of the Ameren management team. 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. We have posted a presentation on the amereninvestors.com homepage. That will be referenced by our speakers. As noted on page two of the presentation, comments made during this conference call may contain statements about future expectations, plans, projections, financial performance, and similar matters which are commonly referred to as forward-looking statements. 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. Now, here's Marty, who will start on page four.

Thanks, Andrew. Good morning, everyone, and thank you for joining us today. Before we cover our second quarter earnings results, I would like to discuss a series of major storm events which occurred in late June and July and disrupted power to a significant number of our electric customers across Illinois and Missouri. Collectively, this was the worst month for storm events Ameren has experienced in approximately 15 years. I would like to thank our customers for their patience as we work to restore their power. I'm also grateful for and proud of the Ameren team. Importantly, our team worked hundreds of thousands of man hours in challenging conditions with no significant employee injuries. These outages emphasize why we believe continued investment in grid reliability and resiliency remains as important and necessary as ever for our customers, which brings me to page four. Our dedicated team will continue to execute our strategic plan across all of our business segments, which entails proactively investing in energy infrastructure to deliver safe, reliable, clean, and affordable electric and natural gas services to our customers. And moving to page five. Our strategic plan integrates our strong sustainability value proposition, balancing the four pillars of environmental stewardship, positive social impact, strong governance, and sustainable growth. Here we summarize some of the many things we are doing for our customers, communities, co-workers, and shareholders. Today, we published our updated sustainability investor presentation called Leading the Way to a Sustainable Energy Future, available at amereninvestors.com, which more fully details how we have been effectively integrating our sustainability values and practices into our corporate strategy. I encourage you to take some time to read more about our strong sustainability value proposition. Turning to page six. Yesterday, we announced second quarter 2023 earnings of $0.90 per share, compared to earnings of $0.80 per share in the second quarter of 2022. The key drivers of our second quarter results are outlined on this slide. As a result of our strong execution in the first half of the year, I'm pleased to report that we remain on track to deliver within our 2023 earnings guidance range of $4.25 per share to $4.45 per share. Moving to page seven. On our call in February, I highlighted some of our key strategic business objectives for 2023. We continue to make great progress as a result of our team's dedication. Outlined on page eight are a few key accomplishments this quarter. As you can see on the right side of this page, we've invested significant capital in each of our business segments during the first half of this year, increasing spending nearly 20% compared to the year-ago period. These investments will continue to improve the reliability, resiliency, safety, and efficiency of our system as we make a clean energy transition for the benefit of our customers. During these first six months of the year, Ameren Missouri installed over 175,000 smart meters, 147 smart switches, and 32 underground cable miles and energized eight upgraded substations. Over 75% of our Ameren Missouri electric customers now have smart meters, allowing for better understanding of energy usage and choice among several time-of-use rates offered. In Illinois, our customers are benefiting from over 3,700 new or reinforced electric poles and 91 new smart switches on electric distribution circuits year-to-date, and we continue to focus on replacing mechanically coupled gas service pipes. Further, our transmission business completed a total of 117 projects in the first half of the year, including line rebuilds, new transmission circuits, transformer replacements, generator interconnections, and other upgrades to aging infrastructure, supporting the economic delivery of renewable energy resources for our customers, as well as the overall resiliency of the transmission system. This includes the transmission portion of our Intelligrid program, which was completed this spring. Ameren's Intelligrid network is a safe and secure private telecommunications network, which enables the full functionality of smart grid technologies, giving Ameren greater awareness of system conditions, potentially reducing outage frequencies, and durations to milliseconds instead of minutes or hours. As a result, it will reduce costs and wait times for customers. I'd like to express my appreciation for the Ameren team's dedication, hard work, and collaboration so far this year to deliver value for our customers. Moving on to regulatory matters. In June, the Missouri Public Service Commission approved constructive settlement terms of the Ameren Missouri electric rate review, which called for a $140 million annual revenue increase. New customer rates were effective July 9, representing an increase of approximately 2% compounded annually since April 1, 2017 prior to Ameren Missouri adopting plant-in-service accounting, or PISA. PISA, which is effective through at least 2028, allows Ameren Missouri to make meaningful and timely infrastructure investments, providing significant benefits to our customers. We also continue to make progress on the clean energy transition through the addition of solar to our generation portfolio. Moving to Ameren Illinois. Our team has been working diligently with key stakeholders in our ongoing electric distribution multi-year rate plan, or MYRP, and natural gas rate reviews. We filed rebuttal testimony in June and July, respectively, and are encouraged by the constructive progress made to date. Michael will discuss these in more detail in a moment. In June, the Ameren Illinois beneficial electrification plan approved by the commission in March was updated to include $65 million through 2025 for programs, incentives, and rates encouraging electric vehicle adoption and infrastructure development. In legislative matters, we were supportive of the transmission efficiency and cooperation law, or House Bill 3445, which was passed by the Illinois General Assembly in May. This bill would support the timely and cost-effective construction of transmission projects, which I will touch on more on the next slide. Moving onto operational matters. We remain focused on keeping customer bills as low as possible through disciplined cost management, continuous improvement, and optimizing our operating performance as we transform our business through investment to ensure we sustainably provide safe, reliable, and cleaner energy for our customers. Finally, in early May, the Callaway Energy Center was brought back online following a brief planned maintenance outage, which was completed safely and on schedule. The next scheduled Callaway refueling and maintenance outage is planned for this fall. Turning to page nine. As I just mentioned, in May, the Illinois General Assembly passed House Bill 3445 or the transmission efficiency and cooperation law which, if enacted, would provide incumbent utilities, including Ameren, the right of first refusal to build MISO long-range transmission planning projects approved by year end 2024. If enacted, HB 3445 will support the clean energy transition, benefiting our Illinois customers and communities and the broader MISO region. As the local utility, we believe we are well-positioned to efficiently build, operate, and maintain these transmission assets over time. The right of first refusal allows for the construction process to begin sooner and the resulting customer benefits to be realized much quicker. Importantly, we competitively bid each component of our projects and utilized local suppliers and contractors who support the local economy. In addition, we have long-term relationships with key stakeholders in the region and work closely with landowners and communities when citing transmission lines. The bill supports the timely and cost-effective construction of the MISO long-range transmission projects, including one Tranche 1 project approved in July 2022 and Tranche 2 projects expected to be approved in the first half of 2024. The legislation was sent to the Governor for signature on June 22, who has until August 21 to sign, veto, or abstain from acting on the bill. Should the Governor abstain, the bill will automatically become law. Turning to page 10. As we've discussed in the past, MISO completed a study outlining a potential roadmap of transmission projects through 2039. Detailed project planning, design work, and procurement for the Tranche 1 projects assigned to Ameren is underway, and we expect construction to begin in 2026. MISO requests for a proposal for its estimated $700 million of Tranche 1 competitive projects have been issued. We submitted our first bid related to the Orient-Denny-Fairport in May. The remaining two bids are due in October and November of this year. The proposal and evaluation process for the competitive projects is expected to take place over the course of 2023 and into mid-2024. Looking ahead to Tranche 2, MISO's analysis of potential projects is well underway and will continue for the remainder of the year and into next year. MISO anticipates the Tranche 2 portfolio of projects will be approved in the first half of 2024. Continued investment in transmission is needed to facilitate the transfer capability of energy across the region as more dispatchable generation retires and renewables come online. On another matter related to MISO, an independent review was completed in July at the request of the ICC, which evaluated the benefits of Ameren Illinois' continued participation in MISO, compared to the PJM Interconnection regional transmission organization. The study considered reliability, resource adequacy, resiliency, affordability, equity, environmental impact, and general health, safety, and welfare of Illinois residents. In conclusion, the independent consultant determined that Ameren Illinois remaining in MISO avoids significant economic costs for the customers of Ameren Illinois and Illinois residents more broadly. Before moving on, I'm happy to say that the Illinois Power Agency's procurement events this past May, which set energy and capacity prices from June 1, 2023 through May 31, 2024, resulted in significantly lower prices compared to last year. In fact, we expect a decline of over 25% in Ameren Illinois' Basic Generation Service rate. For customers taking power from Ameren Illinois, assuming normal weather, this could result in double-digit percentage decreases on their overall electric bill, providing welcome relief for customers. Moving now to page 11. As laid out in our June 2022 Missouri Integrated Resource Plan, or IRP, we're taking a thoughtful and measured approach to investing in new generation as our older energy centers near retirement. In support of this transition, we were pleased with the Missouri PSC approvals of certificates of convenience and necessity, or CCNs, for the Huck Finn Solar Project in February and the Boomtown Solar Project in April. Construction of Boomtown began in July and construction of Huck Finn is expected to begin in October. In June, we filed with the Missouri PSC for four additional CCNs totaling 550 megawatts of new solar generation across our service territory. These projects support our ongoing generation transformation, which calls for adding 2,800 megawatts of renewable generation by 2030, while maintaining the reliability and affordability our customers expect. These projects will bring over 900 new construction jobs and additional tax revenues and other payments to the area. Subject to approval, these solar projects are expected to go in service between 2024 and 2026. While the Missouri PSC is under no deadline to issue an order on these CCN filings, we expect decisions in the first quarter of 2024. Ameren Missouri is in the process of finalizing its next IRP, and we look forward to filing it with the Missouri PSC by the end of September. We believe the plan filed in 2022 includes a balanced and measured approach to adding renewables over time. As we continue the transition to a cleaner and more diverse generation portfolio, we are focused on reliability of the system, in particular, in the hot summer and cold winter months. As a result, we are evaluating the need for more dispatchable energy prior to 2030, which is also consistent with MISO's view of future generation capacity needs in our region. On page 12, we look ahead to the next decade. We have a robust pipeline of investment opportunities, totaling more than $48 billion that will deliver significant value to all of our stakeholders by making our energy grid stronger, smarter, and cleaner. Of course, our investments also create thousands of jobs for our local economies. Maintaining constructive energy policies that support robust investment in energy infrastructure and a transition to a cleaner future in a responsible fashion will be critical to meeting our country's energy needs and delivering on our customers' expectations. Turning to page 13. In February, we updated our five-year growth plan, which included our expectation of a 6% to 8% compound annual earnings growth rate from 2023 through 2027. This earnings growth is primarily driven by our strong compound annual rate base growth of 8.4%, supported by strategic allocation of infrastructure investment to each of our operating segments based on their constructive regulatory frameworks. Combined, we expect to deliver strong long-term earnings and dividend growth, resulting in an attractive total return that compares favorably with our regulated utility peers. I'm confident in our ability to execute our investment plans and strategies across all four of our business segments as we have an experienced and dedicated team to get it done. Again, thank you all for joining us today, and I will now turn the call over to Michael.

Thanks, Marty, and good morning, everyone. Turning now to page 15 of our presentation. Yesterday, we reported second quarter 2023 earnings of $0.90 per share, compared to $0.80 per share for the year-ago quarter. This page summarizes key drivers impacting earnings at each segment. As you can see under our constructive regulatory frameworks, we experienced earnings growth driven by increased investments in infrastructure in all of our business segments. Ameren Missouri earnings were negatively impacted by normal temperatures in the quarter compared to warmer-than-normal temperatures in the year-ago period. We were still able to deliver a strong earnings performance during the quarter as a result of our diverse business mix and disciplined cost management. Before moving on, I'll touch on sales trends for Ameren Missouri and Ameren Illinois electric distribution. Year-to-date weather-normalized kilowatt-hour sales to Missouri residential and industrial customers decreased about 1% and 2.5%, respectively. Year-to-date weather normalized kilowatt-hour sales to Missouri commercial customers increased about 0.5%. The modest decline in residential sales year-over-year were expected as more people return to the office, yet there has been nearly a 4% increase in residential sales as compared to pre-pandemic levels. Year-to-date weather normalized kilowatt-hour sales to Illinois customers have declined about 3.5% compared to last year. Recall that changes in Illinois electric sales, no matter the cause, do not affect our earnings since we have full revenue decoupling. On the economic development front, there have been several announcements to build or expand within our territory. In Missouri, Boeing plans for nearly a $2 billion expansion of its aerospace program and would create 500 new jobs. In addition, ICL Group plans to expand their lithium battery material manufacturing plant in St. Louis, which will support the production of EV batteries and will be the first large-scale plant of its type in the country, creating an additional 165 jobs. I'm pleased to say that we continue to see a strong labor market in Missouri, with an unemployment rate of 2.6%, well below the national average. In Illinois, Manner Polymers and the Prysmian Group announced plans to build facilities manufacturing electric vehicle components and renewable energy cable, which collectively would create nearly 150 jobs in the state. Moving to page 16. Yesterday, we reaffirmed our 2023 earnings guidance range of $4.25 to $4.45 per share. On this page, we've highlighted select considerations impacting our 2023 earnings guidance for the remainder of the year. These are supplemental to the key drivers and assumptions discussed on our earnings call in February. Turning now to page 17, I'll provide an update on our regulatory rate proceedings. In June, the Missouri PSC approved a stipulation and agreement in our Ameren Missouri electric rate review for $140 million annual revenue increase. The agreement was a black box settlement and did not specify certain details including return on equity, capital structure, or rate base. The agreement did provide for the continuation of key trackers and riders, including the fuel adjustment clause. New electric service rates were effective July 9th. In other Missouri regulatory matters, in preparation for the planned retirement of our Rush Island Energy Center, last week Ameren has already filed a 60-day notice with the Missouri PSC for the securitization of costs associated with the Rush Island Energy Center. We will seek to finance the costs associated with the retirement, including our remaining net book value of the Rush Island Energy Center through the securitization. As of June 30, 2023, the net book value was approximately $550 million. We expect to file our petition seeking commission approval of the securitization as early as the fourth quarter of this year. Once filed, the regulatory proceedings are expected to take up to seven months to complete. Moving to Page 18, in January, Ameren Illinois electric distribution filed its first multi-year rate plan, or MYRP, with the ICC. Our MYRP is designed around three key elements: Providing safe and reliable energy to our customers, deploying capital in a way that achieves the Climate and Equitable Jobs Act objectives as included in our performance metrics, and fulfilling the clean energy transition by preparing our system to accept more renewables and electric vehicles over time. The MYRP details a grid modernization plan that includes our planned electric distribution investments and supports our annual revenue increase request for the next four years. On July 13, the ICC staff filed a rebuttal testimony recommending a cumulative increase of $317 million in revenue for 2024 through 2027. This includes a return on equity of 8.9%, reflecting the 2022 average 30-year treasury rate, plus 580 basis points. If adopted, staff suggested the return on equity would be updated annually. It also includes a 50% equity ratio. On July 27, Ameren Illinois updated its request for a cumulative increase of $448 million in revenues. This increase includes a return on equity of 10.5% and an equity ratio of 54%. The variance in the Ameren Illinois cumulative request and the staff's recommended accumulative increase is driven primarily by the return on equity and the common equity ratio, which makes up $81 million of the $131 million variance. An ICC decision is required by December 2023 with new rates effective by January 2024. Turning to page 19. In April, we filed our electric distribution annual rate reconciliation following to reconcile the 2022 revenue requirement to actual cost. In late June, the ICC staff recommended a $109 million base rate increase, compared to our updated request of a $125 million base rate increase. The $16 million variance is primarily driven by a difference in the common equity ratio as we have proposed 54%, compared to the ICC staff's recommended 50%. An ICC decision is required by December 2023 and the full amount will be collected from customers in 2024. Earlier this year, we also filed with the ICC for an annual increase in Ameren Illinois natural gas distribution rates using a 2024 future test year. In July, we filed a third rebuttal testimony requesting a $148 million increase based on a 10.3% ROE, a 54% equity ratio, and a $2.9 billion rate base. Staff has recommended a $128 million increase reflecting a 9.9% return on equity and a 50% equity ratio. Other interveners have recommended an increase of $98 million to a $106 million, reflecting a 9.5% return on equity and a 52% equity ratio. An ICC decision is required by late November 2023 with rates expected to be effective in early December of this year. On page 20, we provide a financing update. We continue to feel very good about our financial position. On May 31, Ameren Illinois issued $500 million of 4.95% first mortgage bonds due in 2033. Proceeds of this offering were used to repay a portion of a short-term debt and to repay a $100 million, or 0.375% first mortgage bonds that matured June 15. Further, in order for us to maintain our credit ratings and a strong balance sheet while we fund our robust infrastructure plan, we expect to issue approximately $300 million of common equity, consisting of approximately $3.2 million shares by the end of this year. These shares were previously sold forward under our ATM equity program. Additionally, we have begun to enter into forward sales agreements to support our 2024 equity needs. As of June 30, approximately $92 million of the $500 million of equity outlined for 2024 has been sold forward under the program. Together with the issuance under our 401(k) and DRPlus programs, our ATM equity program is expected to support our equity needs in 2024 and beyond. And turning to page 21. We're off to a strong start and well-positioned to continue executing our plan. We expect to deliver strong earnings growth in 2023 and over the long term, driven by robust rate base growth and disciplined cost management. Further, we believe this growth will compare favorably with the growth of our peers. Ameren shares continue to offer investors an attractive dividend and total shareholder return story. This concludes our prepared remarks. We now invite your questions.

Thank you. At this time, we'll be conducting a question-and-answer session. Our first question comes from Julien Dumoulin-Smith with Bank of America. Please proceed with your question.

Hey, good morning, team. Thanks so much for the time. Appreciate it. Thanks for all the comments. Maybe just kicking this thing up on the Rush Island side of the equation. Just with the book value, it seems like that $550 million. Can you comment a little bit on the size of the securitization and maybe the offset to that, if you will, when you think about the additional transmission rate base opportunities in otherwise you articulated? Just thinking about the timing and the net puts and takes here, if you will.

Good morning, Julien. Thank you for your question. This is Michael. Regarding the overall amount, we currently provide a book value of $550 million, which will likely be the case a year from now. You should consider it to be around $500 million due to some depreciation and other factors. This includes items like inventory. I want to emphasize that we have significant flexibility in how we utilize this amount for additional investments. It's not restricted and mainly needs to be reinvested into infrastructure. We can also use it for debt buybacks and other purposes, in line with our capital plan. From a timing standpoint, we are being careful to determine the actual retirement date well in advance, ensuring we have adequate time to replace the rate base over time and avoid any potential earnings impact. I hope that clarifies things.

No, absolutely. Thanks again. When you consider the offsets, particularly regarding Rush Island and the securitization happening in a year, there are several factors to discuss. Transmission stands out as the most significant element you mentioned earlier. Can you provide more details about what HB 3445, if I got the number right, entails? Additionally, could you share insights on the timing for Tranche 2 and the potential opportunities it presents, especially in comparison to Tranche 1? I'm trying to emphasize the importance of the opportunities available.

Hey, Julien. This is Marty. Hey, thanks, again, for your questions. Just to first tack on to what Michael said and then answer some of your specific questions, but when we planned out our capital expenditures for these five years and we looked at the timing and amount on a year-by-year basis, we were thoughtful about the potential timing of this Rush Island closure and securitization filing. And so, within that, we had already timed some of our capital expenditures in a thoughtful manner to, as Michael said, ensure that as Rush Island comes out of rate base, we don't have any kink, if you will, in the trajectory of our rate base growth and our earnings growth. So, some of that's already baked into our plan, Julien, I guess, first and foremost. Now, you did ask about some of the transmission investment, and specifically about the legislation coming through Illinois, the transmission efficiency and cooperation law, which was HB 3445 that you referenced. There, as we explained in our prepared remarks, the General Assembly passed that legislation in May of this year. And now it's really on the Governor's desk for his potential signature. So, it got to the Governor on June 22, and he has 60 days, which means the decision deadline for the Governor is August 21. If he were to sign that, that would mean that one Tranche 1 project in Illinois would come to us, and then any Tranche 2 projects that were approved in the first half of '24, that's our expectation, but anytime in 2024 would also come to us as the incumbent transmission owner. Now, the Governor has expressed some concerns about that legislation. So, it's unsure what actions he will take. I'll tell you that supporters of the bill, including ourselves, continue to share the benefits of the legislation and hopefully address his concerns. If he signs the law, obviously, that bill becomes law. And as we mentioned in our prepared remarks, if he takes no action, that bill becomes law as well. So, we'll see what action he ultimately takes. But we continue to believe that that right of first refusal is really in the best interests of our customers and the residents of the State of Illinois. Then you just mentioned what MISO is doing in terms of these projects. Again, as you know, MISO is evaluating what projects might come out of Tranche 2. I will say there that we continue to believe that the work they're doing points to an overall portfolio that would be larger than what they approved in part of Tranche 1. And that's really because, as they've gone through this analysis, one of the things, obviously, that's come to fruition is the IRA legislation in D.C., which means that we expect more renewables than had previously been expected. MISO is planning toward something that's between sort of a Future 2 and Future 3. Again, we expect that they'll continue to work through that. It's premature to say exactly how large that portfolio will be or exactly what transmission projects may fall into our service territories in Illinois or Missouri. But MISO continues to believe that they'll approve those projects in the first half of next year.

Got it. Excellent, thank you for the thoughtful response, guys. Really appreciate it. Take care.

Thanks, Julien.

Thanks, Julien.

Our next question comes from Paul Patterson with Glenrock Associates. Please proceed with your question.

Hey, good morning, guys.

Good morning, Paul.

So to follow up on Julien's questions about the ROFR, I was wondering if the Supreme Court and the Fifth Circuit's decision regarding the ROFR in Texas could have any wider implications across the country if it's upheld.

Paul, I apologize for the confusion. Some of the actions taken in different states seem to be related to how legislation was passed. We will continue to pursue this. If the Governor signs it into law, we believe it will apply to both MISO Tranche 1 and the approved Tranche 2 projects in 2024. We remain optimistic about this, but only time will tell how it plays out.

You believe it would hold up. So, if the Fifth Circuit, which is specific to Texas, doesn't apply to Illinois due to the unique aspects of the laws involved, assuming the legislation is signed, is that correct?

I do believe that.

Okay. That's great. Thanks so much.

Thanks, Paul.

Our next question comes from Jeremy Tonet, J.P. Morgan. Please proceed with your question.

Hi, good morning.

Hey, good morning, Jeremy.

Hey, Jeremy.

Hey. Just wanted to dial into Illinois a little bit more if we could, and I know that you touched on your commentary. But just wondering if it's possible to provide any more color on updates in the Illinois electric rate case. And just maybe how the tone of conversations with regulators and stakeholders have been trending recently.

Yes, I think I'll start, and Michael might want to add in as well. This is Marty. In our prepared remarks, we mentioned that we are working constructively with stakeholders throughout this process. This is our first multi-year grid and multi-year rate filing, so we expected to navigate some challenges. However, I believe we will reach a positive outcome that aligns with the policy goals of CEJA for the state. Initially, during direct testimony, the ICC staff recommended around 56% of our overall request. Through further rounds of testimony and support provided to the staff, we have collaboratively moved to where their suggested revenue increase is now approximately 70% of our request. This indicates positive progress. In our slides, we noted that there remains a gap between our requested cumulative increase and the amount recommended by the staff, which is about $131 million over four years. We outlined some of those components. We will continue to work constructively with stakeholders, and I am optimistic that we will achieve a favorable outcome that supports CEJA's policy goals. If you have any specific questions, or Michael, would you like to add anything?

Yes, Marty provided a good overview. The team, consisting of us, staff, and others, has been working collaboratively to address these issues. Our goal is to find the best solutions for our customers while achieving the policy objectives that CEJA aims for. As Marty mentioned, there is a difference of about $131 million today, with approximately 62% of that related to ROE and capital structure. This reflects a significant difference in ROE. They are still suggesting the previous formula approved under EMIA, which is 580 basis points plus the 30-year treasury, whereas we believe the law mandates that the cost of equity should be determined by the commission under state law governing rate reviews. Additionally, if we calculate the current ROE using 580 basis points, it approaches 10. I would also note that under traditional cost of capital methodologies, such as CAPM or DCF, the staff indicated they would have been at about 10.02 before reverting to this formula. I provided these details to clarify the discrepancies, Jeremy.

Got it. That's very helpful. And maybe a follow-up to peel back a little bit more, if I can, if there is anything left that can be said here. Just specifically with regards to your rebuttal strategy on the notably lower-than-expected ROE, the $700 million capital discrepancy, $100 million medical OPEB overfunded balance. Just wondering if you could speak to any changes in receptivity overall given Ameren's rebuttal?

Yes, Hey Jeremy, this is Michael again. Just to clarify, I think that receptivity has improved, as evidenced by the fact that we've closed that gap. You mentioned the $700 million gap; I would say it's now about $350 million. Some significant work has been done on both sides to agree on additional support and move forward with those. Marty noted the increase from 56% to 70% of the ask, which has played a big role in this. The other issues you mentioned, including the post-retirement matter, are still in discussion, and we believe it should be included. Customers benefit from this as it is an overfunded plan that generates gains, which in turn lower rates for customers. We will keep advocating for this and see where it leads in the coming months.

Got it. That's very helpful. One just quick last one, if I could. With the decrease in energy prices, as we've seen, has bid pressure kind of faded from the conversations with the public and policymakers? Or is it still front of mind in discussions?

No, look, I mean, I think the overall backdrop is much better today given what's happened with commodity prices both on the natural gas side. You've actually already seen some of those benefits start rolling through on the PGAs, etc. I think we've talked about that. And then certainly, some of these capacity auctions and the corresponding energy auctions are certainly providing relief to customers. That's always a good thing to see, right, in terms of just making sure that we're trying to get the lowest possible bill for customers. So I'd say it's less of a conversation today and it's a good tailwind as we think about the future.

Got it. That makes sense. That’s helpful. I’ll leave it there. Thanks.

Okay. Thanks, Jeremy.

Our next question comes from Sophie Karp with KeyBanc Capital Markets. Please proceed with your question.

Hi, good morning and thank you for taking my question about the situation in Illinois. You have already provided a lot of information, but I am curious if you believe there is a valid legal argument for using the old formula in the new framework, especially since the staff is adhering to that old formula.

Yes. Sophie, this is Marty. One of the things CEJA called for in the legislation was that the cost of equity be determined consistent with commission practice and law. We believe that means the use of traditional methods like capital asset pricing model, discounted cash flow analysis, IEIMA which was the prior legislation, had some very explicit language that required the use of formulaic. So we've certainly argued that the intent of CEJA was for the commission to use its traditional methodology. I would note there that the staff and their testimony as part of the multi-year rate plan, instead of that traditional CAPM and DCF kind of analysis was used that they would get an ROE of about 10.02 as a recommendation. And of course, in our gas rate case that's pending, the staff there recommending a 9.89. So at the end of the day, that's what we're hanging our head on is that we believe that CEJA called for the use of that kind of methodology.

Thank you for that. I have a question about your solar projects in Missouri, especially the ones you are directly involved in. How are you approaching your procurement strategy concerning potential incentives for domestic content? Does this impact your choices regarding the equipment you plan to procure for these projects?

Yes, Sophie, it certainly does. As shown in our slides regarding our build-out, we plan to engage in projects through build-transfer agreements that developers will construct, projects that we will develop to a certain stage before completing the construction ourselves, and some projects that we will self-build. We are considering various factors when determining the locations and materials for these projects. If a site offers us additional tax credit opportunities, we will pursue that. We will also utilize procurement strategies that enable us to maximize credit values. Ultimately, our aim is to build a diverse portfolio of projects that offers low costs and reliability for our customers. We intend to maximize these tax credits to provide the lowest present value of revenue requirements for our customers.

Great. Thank you. And do you expect to self-consume those tax credits? Or would you be looking to monetize them to the third party?

Ultimately, I think it's a combination of both, Sophie. I mean, we're not sitting on a lot of credit today. But as we build into these, certainly again we'll be very thoughtful about. We've been very involved in these issues on transferability and get a clarification working through some of these rating agency issues, etc. I absolutely think that it could be a combination of both as we move forward.

Thank you so much. That’s all from me.

You bet. Thanks.

Our next question comes from Julien Dumoulin-Smith with Bank of America. Please proceed with your question.

Hey, everyone. I was concerned it might wrap up sooner than expected. I wanted to fit in a couple more questions. I wanted to return to the topic of Illinois for a moment. Do you have any insights on Illinois gas? I understand it's still early, but it appears there could be discussions heading into 2024 regarding potential reforms similar to those in Colorado or perhaps Minnesota. What are you hearing or seeing on this front?

Yes, Julien, in terms of legislation for next year, I can't say that there's anything percolating right now that we're aware of or involved in. I think that right now, our focus obviously is on this Illinois multi-year rate plan on the electric side. Also getting a constructive resolution of our pending Illinois gas case. And so that's our focus right now. I know in the past, there was some discussion around QIP, but of course, that's expiring at the end of this year. Right now, we think we're positioned well as we utilize the forward rate cases in Illinois for our gas business. So really nothing to share with you on that front right now, Julien.

All right. Fair enough. And obviously, you've got these new CCNs going on the Missouri side. Just any lessons learned from Boomtown, Huck, et cetera?

I don't think there are any specific lessons learned. We were certainly pleased to receive the commission's authorization to move forward with Huck and Boomtown and pleased with the orders received and the resolution of those. I wouldn't say there's any specific lesson learned. We think all four of the projects that we have proposed are excellent projects for the benefit of our customers and move us along the path towards the investments that were laid out in our 2022 IRP. We've got another IRP that we plan to file this September. Certainly, we think those projects are consistent with the path that we'll lay out as part of that IRP as well.

Awesome. All right, guys. Super quick. Thank you.

Thank you, Julien.

It appears that there are no further questions at this time. I would now like to turn the floor back over to Marty Lyons for closing remarks.

Yes. Terrific. Well, thank you all for joining us today. We had a strong first half of 2023, and we remain absolutely focused on strong execution for the remainder of this year. So we look forward to seeing many of you at conferences in the coming months, and thanks again, have a great day.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation.