FAIR VALUE MEASUREMENTS

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. We use various methods to determine fair value, including market, income, and cost approaches. With these approaches, we adopt certain assumptions that market participants would use in pricing the asset or liability, including assumptions about market risk or the risks inherent in the inputs to the valuation. Inputs to valuation can be readily observable, market-corroborated, or unobservable. We use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. Authoritative accounting guidance established a fair value hierarchy that prioritizes the inputs used to measure fair value. All financial assets and liabilities carried at fair value are classified and disclosed in one of the following three hierarchy levels:

Level 1: Inputs based on quoted prices in active markets for identical assets or liabilities. Level 1 assets and liabilities are primarily exchange-traded derivatives and assets, including cash and cash equivalents and listed equity securities, such as those held in Ameren Missouri’s nuclear decommissioning trust fund.

The market approach is used to measure the fair value of equity securities held in Ameren Missouri’s nuclear decommissioning trust fund. Equity securities in this fund are representative of the S&P 500 index, excluding securities of Ameren Corporation, owners and/or operators of nuclear power plants and the trustee and investment managers. The S&P 500 index comprises stocks of large capitalization companies.

Level 2: Market-based inputs corroborated by third-party brokers or exchanges based on transacted market data. Level 2 assets and liabilities include certain assets held in Ameren Missouri’s nuclear decommissioning trust fund, including corporate bonds and other fixed-income securities, United States Treasury and agency securities, and certain over-the-counter derivative instruments, including natural gas and financial power transactions.

Fixed income securities are valued using prices from independent industry recognized data vendors who provide values that are either exchange-based or matrix-based. The fair value measurements of fixed income securities classified as Level 2 are based on inputs other than quoted prices that are observable for the asset or liability. Examples are matrix pricing, market-corroborated pricing, and inputs such as yield curves and indices. Level 2 fixed income securities in the nuclear decommissioning trust fund are primarily corporate bonds, asset-backed securities and United States agency bonds.

Derivative instruments classified as Level 2 are valued by corroborated observable inputs, such as pricing services or prices from similar instruments that trade in liquid markets. Our development and corroboration process entails obtaining multiple quotes or prices from outside sources. To derive our forward view to price our derivative instruments at fair value, we average the midpoints of the bid/ask spreads. To validate forward prices obtained from outside parties, we compare the pricing to recently settled market transactions. Additionally, a review of all sources is performed to identify any anomalies or potential errors. Further, we consider the volume of transactions on certain trading platforms in our reasonableness assessment of the averaged midpoint. Natural gas derivative contracts are valued based upon exchange closing prices without significant unobservable adjustments. Power derivative contracts are valued based upon the use of multiple forward prices provided by third parties. The prices are averaged and shaped to a monthly profile when needed without significant unobservable adjustments.

Level 3: Unobservable inputs that are not corroborated by market data. Level 3 assets and liabilities are valued by internally developed models and assumptions or methodologies that use significant unobservable inputs. Level 3 assets and liabilities include derivative instruments that trade in less liquid markets, where pricing is largely unobservable. We value Level 3 instruments by using pricing models with inputs that are often unobservable in the market, as well as certain internal assumptions. Our development and corroboration process entails obtaining multiple quotes or prices from outside sources. As a part of our reasonableness review, an evaluation of all sources is performed to identify any anomalies or potential errors.

We perform an analysis each quarter to determine the appropriate hierarchy level of the assets and liabilities subject to fair value measurements. Financial assets and liabilities are classified in their entirety according to the lowest level of input that is significant to the fair value measurement. All assets and liabilities whose fair value measurement is based on significant unobservable inputs are classified as Level 3.

The following table describes the valuation techniques and unobservable inputs for the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy as of September 30, 2014:



		Fair Value								Weighted Average
		Assets		Liabilities			Valuation Technique(s)	Unobservable Input	Range	Weighted Average
Level 3 Derivative asset and liability - commodity contracts^(a):
Ameren	Fuel oils	$	3	$	(3	)	Option model	Volatilities(%)^(b)	2 - 27	14
							Discounted cash flow	Counterparty credit risk(%)^(c)(d)	0.25 - 1	0.72
								Ameren Missouri credit risk(%)^(c)(d)	0.43	(e)
	Natural gas	1		—			Discounted cash flow	Nodal basis($/mmbtu)^(c)	(0.10) - 0	(0.10)
								Counterparty credit risk(%)^(c)(d)	0.30 - 2	0.62
								Ameren Illinois credit risk(%)^(c)(d)	0.43	(e)
	Power^(f)	10		(129		)	Discounted cash flow	Average forward peak and off-peak pricing - forwards/swaps($/MWh)^(c)	29 - 59	35
								Estimated auction price for FTRs($/MW)^(b)	(1,853) - 2,087	199
								Nodal basis($/MWh)^(c)	(6) - 0	(3)
								Counterparty credit risk(%)^(c)(d)	0.40	(e)
								Ameren Missouri and Ameren Illinois credit risk(%)^(c)(d)	0.43	(e)
							Fundamental energy production model	Estimated future gas prices($/mmbtu)^(b)	4 - 5	5
								Escalation rate(%)^(b)(g)	2	(e)
							Contract price allocation	Estimated renewable energy credit costs($/credit)^(b)	5 - 7	6
	Uranium	—		(3		)	Discounted cash flow	Average forward uranium pricing($/pound)^(b)	35 - 41	36
Ameren Missouri	Fuel oils	$	3	$	(3	)	Option model	Volatilities(%)^(b)	2 - 27	14
							Discounted cash flow	Counterparty credit risk(%)^(c)(d)	0.25 - 1	0.72
								Ameren Missouri credit risk(%)^(c)(d)	0.43	(e)
	Power^(f)	10		(5		)	Discounted cash flow	Average forward peak and off-peak pricing - forwards/swaps($/MWh)^(c)	30 - 59	48
								Estimated auction price for FTRs($/MW)^(b)	(1,853) - 2,087	199
								Counterparty credit risk(%)^(c)(d)	0.40	(e)
								Ameren Missouri credit risk(%)^(c)(d)	0.43	(e)
	Uranium	—		(3		)	Discounted cash flow	Average forward uranium pricing($/pound)^(b)	35 - 41	36
Ameren Illinois	Natural gas	$	1	$	—		Discounted cash flow	Nodal basis($/mmbtu)^(c)	(0.10) - 0	(0.10)
								Counterparty credit risk(%)^(c)(d)	0.30 - 2	0.62
								Ameren Illinois credit risk(%)^(c)(d)	0.43	(e)
	Power^(f)	—		(124		)	Discounted cash flow	Average forward peak and off-peak pricing - forwards/swaps($/MWh)^(b)	29 - 42	33
								Nodal basis($/MWh)^(b)	(6) - 0	(3)
								Ameren Illinois credit risk(%)^(c)(d)	0.43	(e)
							Fundamental energy production model	Estimated future gas prices($/mmbtu)^(b)	4 - 5	5
								Escalation rate(%)^(b)(g)	2	(e)
							Contract price allocation	Estimated renewable energy credit costs($/credit)^(b)	5 - 7	6


(a)	The derivative asset and liability balances are presented net of counterparty credit considerations.


(b)	Generally, significant increases (decreases) in this input in isolation would result in a significantly higher (lower) fair value measurement.


(c)	Generally, significant increases (decreases) in this input in isolation would result in a significantly lower (higher) fair value measurement.


(d)	Counterparty credit risk is applied only to counterparties with derivative asset balances. Ameren Missouri and Ameren Illinois credit risk is applied only to counterparties with derivative liability balances.


(e)	Not applicable.


(f)	Power valuations use visible third-party pricing evaluated by month for peak and off-peak demand through 2018. Valuations beyond 2018 use fundamentally modeled pricing by month for peak and off-peak demand.


(g)	Escalation rate applies to power prices 2026 and beyond.



		Fair Value								Weighted Average
		Assets		Liabilities			Valuation Technique(s)	Unobservable Input	Range	Weighted Average
Level 3 Derivative asset and liability – commodity contracts^(a):
Ameren	Fuel oils	$	8	$	(3	)	Option model	Volatilities(%)^(b)	10 - 35	16
							Discounted cash flow	Counterparty credit risk(%)^(c)(d)	0.26 - 2	1
	Power^(e)	21		(110		)	Discounted cash flow	Average forward peak and off-peak pricing - forwards/swaps($/MWh)^(c)	25 - 51	32
								Estimated auction price for FTRs($/MW)^(b)	(1,594) - 945	305
								Nodal basis($/MWh)^(c)	(3) - (1)	(2)
								Counterparty credit risk(%)^(c)(d)	0.39 - 0.50	0.42
								Ameren Missouri and Ameren Illinois credit risk(%)^(c)(d)	2	(f)
							Fundamental energy production model	Estimated future gas prices($/mmbtu)^(b)	4 - 5	5
								Escalation rate(%)^(b)(g)	3 - 4	4
							Contract price allocation	Estimated renewable energy credit costs($/credit)^(b)	5 - 7	6
	Uranium	—		(6		)	Discounted cash flow	Average forward uranium pricing($/pound)^(b)	34 - 41	36
Ameren Missouri	Fuel oils	$	8	$	(3	)	Option model	Volatilities(%)^(b)	10 - 35	16
							Discounted cash flow	Counterparty credit risk(%)^(c)(d)	0.26 - 2	1
	Power^(e)	21		(2		)	Discounted cash flow	Average forward peak and off-peak pricing - forwards/swaps($/MWh)^(c)	25 - 51	40
								Estimated auction price for FTRs($/MW)^(b)	(1,594) - 945	305
								Nodal basis($/MWh)^(c)	(3) - (1)	(2)
								Counterparty credit risk(%)^(c)(d)	0.39 - 0.50	0.42
								Ameren Missouri credit risk(%)^(c)(d)	2	(f)
	Uranium	—		(6		)	Discounted cash flow	Average forward uranium pricing($/pound)^(b)	34 - 41	36
Ameren Illinois	Power^(e)	$	—	$	(108	)	Discounted cash flow	Average forward peak and off-peak pricing - forwards/swaps($/MWh)^(b)	27 - 36	30
								Nodal basis($/MWh)^(b)	(4) - 0	(2)
								Ameren Illinois credit risk(%)^(c)(d)	2	(f)
							Fundamental energy production model	Estimated future gas prices($/mmbtu)^(b)	4 - 5	5
								Escalation rate(%)^(b)(g)	3 - 4	4
							Contract price allocation	Estimated renewable energy credit costs($/credit)^(b)	5 - 7	6


(a)	The derivative asset and liability balances are presented net of counterparty credit considerations.


(b)	Generally, significant increases (decreases) in this input in isolation would result in a significantly higher (lower) fair value measurement.


(c)	Generally, significant increases (decreases) in this input in isolation would result in a significantly lower (higher) fair value measurement.


(d)	Counterparty credit risk is applied only to counterparties with derivative asset balances. Ameren Missouri and Ameren Illinois credit risk is applied only to counterparties with derivative liability balances.


(e)	Power valuations use visible third-party pricing evaluated by month for peak and off-peak demand through 2017. Valuations beyond 2017 use fundamentally modeled pricing by month for peak and off-peak demand.


(f)	Not applicable.


(g)	Escalation rate applies to power prices 2026 and beyond.

In accordance with applicable authoritative accounting guidance, we consider nonperformance risk in our valuation of derivative instruments by analyzing the credit standing of our counterparties and considering any counterparty credit enhancements (e.g., collateral). The guidance also requires that the fair value measurement of liabilities reflect the nonperformance risk of the reporting entity, as applicable. Therefore, we have factored the impact of our credit standing, as well as any potential credit enhancements, into the fair value measurement of both derivative assets and derivative liabilities. Included in our valuation, and based on current market conditions, is a valuation adjustment for counterparty default derived from market data such as the price of credit default swaps, bond yields, and credit ratings. No gains or losses related to valuation adjustments for counterparty default risk were recorded at Ameren, Ameren Missouri or Ameren Illinois in the first nine months of 2014 or 2013. At September 30, 2014, the counterparty default risk liability valuation adjustment related to derivative contracts totaled $1 million, less than $1 million, and $1 million, for Ameren, Ameren Missouri and Ameren Illinois, respectively. At December 31, 2013, the counterparty default risk liability valuation adjustment related to derivative contracts totaled $3 million, less than $1 million, and $3 million, for Ameren, Ameren Missouri and Ameren Illinois, respectively.

The following table sets forth, by level within the fair value hierarchy, our assets and liabilities measured at fair value on a recurring basis as of September 30, 2014:



		Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total
Assets:
Ameren	Derivative assets - commodity contracts^(a):
	Fuel oils	$	—	$	—	$	3	$	3
	Natural gas	—		1		1		2
	Power	—		1		10		11
	Total derivative assets - commodity contracts	$	—	$	2	$	14	$	16
	Nuclear decommissioning trust fund:
	Cash and cash equivalents	$	1	$	—	$	—	$	1
	Equity securities:
	U.S. large capitalization	348		—		—		348
	Debt securities:
	Corporate bonds	—		60		—		60
	Municipal bonds	—		2		—		2
	U.S. treasury and agency securities	—		100		—		100
	Asset-backed securities	—		11		—		11
	Other	—		5		—		5
	Total nuclear decommissioning trust fund	$	349	$	178	$	—	$	527	^(b)
	Total Ameren	$	349	$	180	$	14	$	543
Ameren	Derivative assets - commodity contracts^(a):
Missouri	Fuel oils	$	—	$	—	$	3	$	3
	Power	—		1		10		11
	Total derivative assets - commodity contracts	$	—	$	1	$	13	$	14
	Nuclear decommissioning trust fund:
	Cash and cash equivalents	$	1	$	—	$	—	$	1
	Equity securities:
	U.S. large capitalization	348		—		—		348
	Debt securities:
	Corporate bonds	—		60		—		60
	Municipal bonds	—		2		—		2
	U.S. treasury and agency securities	—		100		—		100
	Asset-backed securities	—		11		—		11
	Other	—		5		—		5
	Total nuclear decommissioning trust fund	$	349	$	178	$	—	$	527	^(b)
	Total Ameren Missouri	$	349	$	179	$	13	$	541
Ameren	Derivative assets - commodity contracts^(a):
Illinois	Natural gas	$	—	$	1	$	1	$	2
Liabilities:
Ameren	Derivative liabilities - commodity contracts^(a):
	Fuel oils	$	3	$	—	$	3	$	6
	Natural gas	2		26		—		28
	Power	—		1		129		130
	Uranium	—		—		3		3
	Total Ameren	$	5	$	27	$	135	$	167
Ameren	Derivative liabilities - commodity contracts^(a):
Missouri	Fuel oils	$	3	$	—	$	3	$	6
	Natural gas	2		4		—		6
	Power	—		1		5		6
	Uranium	—		—		3		3
	Total Ameren Missouri	$	5	$	5	$	11	$	21
Ameren	Derivative liabilities - commodity contracts^(a):
Illinois	Natural gas	$	—	$	22	$	—	$	22
	Power	—		—		124		124
	Total Ameren Illinois	$	—	$	22	$	124	$	146


(a)	The derivative asset and liability balances are presented net of counterparty credit considerations.


(b)	Balance excludes $2 million of receivables, payables, and accrued income, net.

The following table sets forth, by level within the fair value hierarchy, our assets and liabilities measured at fair value on a recurring basis as of December 31, 2013:



		Quoted Prices in Active Markets for Identical Assets or Liabilities (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Other Unobservable Inputs (Level 3)		Total
Assets:
Ameren	Derivative assets - commodity contracts^(a):
	Fuel oils	$	1	$	—	$	8	$	9
	Natural gas	—		2		—		2
	Power	—		2		21		23
	Total derivative assets - commodity contracts	$	1	$	4	$	29	$	34
	Nuclear decommissioning trust fund:
	Cash and cash equivalents	$	3	$	—	$	—	$	3
	Equity securities:
	U.S. large capitalization	332		—		—		332
	Debt securities:
	Corporate bonds	—		52		—		52
	Municipal bonds	—		2		—		2
	U.S. treasury and agency securities	—		94		—		94
	Asset-backed securities	—		10		—		10
	Other	—		1		—		1
	Total nuclear decommissioning trust fund	$	335	$	159	$	—	$	494
	Total Ameren	$	336	$	163	$	29	$	528
Ameren	Derivative assets - commodity contracts^(a):
Missouri	Fuel oils	$	1	$	—	$	8	$	9
	Natural gas	—		1		—		1
	Power	—		2		21		23
	Total derivative assets - commodity contracts	$	1	$	3	$	29	$	33
	Nuclear decommissioning trust fund:
	Cash and cash equivalents	$	3	$	—	$	—	$	3
	Equity securities:
	U.S. large capitalization	332		—		—		332
	Debt securities:
	Corporate bonds	—		52		—		52
	Municipal bonds	—		2		—		2
	U.S. treasury and agency securities	—		94		—		94
	Asset-backed securities	—		10		—		10
	Other	—		1		—		1
	Total nuclear decommissioning trust fund	$	335	$	159	$	—	$	494
	Total Ameren Missouri	$	336	$	162	$	29	$	527
Ameren	Derivative assets - commodity contracts^(a):
Illinois	Natural gas	$	—	$	1	$	—	$	1
Liabilities:
Ameren	Derivative liabilities - commodity contracts^(a):
	Fuel oils	$	—	$	—	$	3	$	3
	Natural gas	3		54		—		57
	Power	—		2		110		112
	Uranium	—		—		6		6
	Total Ameren	$	3	$	56	$	119	$	178
Ameren	Derivative liabilities - commodity contracts^(a):
Missouri	Fuel oils	$	—	$	—	$	3	$	3
	Natural gas	3		8		—		11
	Power	—		2		2		4
	Uranium	—		—		6		6
	Total Ameren Missouri	$	3	$	10	$	11	$	24
Ameren	Derivative liabilities - commodity contracts^(a):
Illinois	Natural gas	$	—	$	46	$	—	$	46
	Power	—		—		108		108
	Total Ameren Illinois	$	—	$	46	$	108	$	154


(a)	The derivative asset and liability balances are presented net of counterparty credit considerations.

The following table summarizes the changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy for the three months ended September 30, 2014:



		Net derivative commodity contracts
Three Months		Ameren Missouri			Ameren Illinois			Ameren
Fuel oils:
Beginning balance at July 1, 2014	$	2		$	(a)		$	2
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(2	)		(a)			(2	)
Ending balance at September 30, 2014	$	—		$	(a)		$	—
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	(2	)	$	(a)		$	(2	)
Natural gas:
Beginning balance at July 1, 2014	$	—		$	—		$	—
Realized and unrealized gains (losses) included in regulatory assets/liabilities		—			1			1
Ending balance at September 30, 2014	$	—		$	1		$	1
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	—		$	—		$	—
Power:
Beginning balance at July 1, 2014	$	15		$	(103	)	$	(88	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(5	)		(23	)		(28	)
Settlements		(5	)		2			(3	)
Ending balance at September 30, 2014	$	5		$	(124	)	$	(119	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	(6	)	$	(22	)	$	(28	)
Uranium:
Beginning balance at July 1, 2014	$	(7	)	$	(a)		$	(7	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		3			(a)			3
Settlements		1			(a)			1
Ending balance at September 30, 2014	$	(3	)	$	(a)		$	(3	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	3		$	(a)		$	3


(a)	Not applicable.

The following table summarizes the changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy for the three months ended September 30, 2013:



		Net derivative commodity contracts
Three Months		Ameren Missouri			Ameren Illinois			Ameren
Fuel oils:
Beginning balance at July 1, 2013	$	3		$	(a)		$	3
Realized and unrealized gains (losses) included in regulatory assets/liabilities		1			(a)			1
Purchases		1			(a)			1
Sales		(1	)		(a)			(1	)
Settlements		(1	)		(a)			(1	)
Ending balance at September 30, 2013	$	3		$	(a)		$	3
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	1		$	(a)		$	1
Natural gas:
Beginning balance at July 1, 2013	$	(1	)	$	2		$	1
Realized and unrealized gains (losses) included in regulatory assets/liabilities		—			(2	)		(2	)
Purchases		1			—			1
Ending balance at September 30, 2013	$	—		$	—		$	—
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	—		$	(1	)	$	(1	)
Power:
Beginning balance at July 1, 2013	$	37		$	(80	)	$	(43	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(3	)		(17	)		(20	)
Sales		1			—			1
Settlements		(6	)		3			(3	)
Transfers into Level 3		(1	)		—			(1	)
Ending balance at September 30, 2013	$	28		$	(94	)	$	(66	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	(2	)	$	(16	)	$	(18	)
Uranium:
Beginning balance at July 1, 2013	$	(3	)	$	(a)		$	(3	)
Purchases		(2	)		(a)			(2	)
Ending balance at September 30, 2013	$	(5	)	$	(a)		$	(5	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	(2	)	$	(a)		$	(2	)


(a)	Not applicable.

The following table summarizes the changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy for the nine months ended September 30, 2014:



		Net derivative commodity contracts
Nine Months		Ameren Missouri			Ameren Illinois			Ameren
Fuel oils:
Beginning balance at January 1, 2014	$	5		$	(a)		$	5
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(3	)		(a)			(3	)
Settlements		(2	)		(a)			(2	)
Ending balance at September 30, 2014	$	—		$	(a)		$	—
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	(2	)	$	(a)		$	(2	)
Natural gas:
Beginning balance at January 1, 2014	$	—		$	—		$	—
Realized and unrealized gains (losses) included in regulatory assets/liabilities		—			1			1
Purchases		—			(1	)		(1	)
Settlements		—			1			1
Ending balance at September 30, 2014	$	—		$	1		$	1
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	—		$	—		$	—
Power:
Beginning balance at January 1, 2014	$	19		$	(108	)	$	(89	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(23	)		(19	)		(42	)
Purchases		34			—			34
Settlements		(25	)		3			(22	)
Ending balance at September 30, 2014	$	5		$	(124	)	$	(119	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	(3	)	$	(21	)	$	(24	)
Uranium:
Beginning balance at January 1, 2014	$	(6	)	$	(a)		$	(6	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(1	)		(a)			(1	)
Settlements		4			(a)			4
Ending balance at September 30, 2014	$	(3	)	$	(a)		$	(3	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2014	$	—		$	(a)		$	—


(a)	Not applicable.

The following table summarizes the changes in the fair value of financial assets and liabilities classified as Level 3 in the fair value hierarchy for the nine months ended September 30, 2013:



		Net derivative commodity contracts
Nine Months		Ameren Missouri			Ameren Illinois			Ameren
Fuel oils:
Beginning balance at January 1, 2013	$	5		$	(a)		$	5
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(1	)		(a)			(1	)
Purchases		2			(a)			2
Sales		(1	)		(a)			(1	)
Settlements		(2	)		(a)			(2	)
Ending balance at September 30, 2013	$	3		$	(a)		$	3
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	—		$	(a)		$	—
Natural gas:
Beginning balance at January 1, 2013	$	—		$	—		$	—
Realized and unrealized gains (losses) included in regulatory assets/liabilities		—			(1	)		(1	)
Purchases		—			1			1
Ending balance at September 30, 2013	$	—		$	—		$	—
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	—		$	—		$	—
Power:
Beginning balance at January 1, 2013	$	11		$	(111	)	$	(100	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		3			(2	)		1
Purchases		40			—			40
Sales		1			—			1
Settlements		(28	)		19			(9	)
Transfers into Level 3		(3	)		—			(3	)
Transfers out of Level 3		4			—			4
Ending balance at September 30, 2013	$	28		$	(94	)	$	(66	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	—		$	(7	)	$	(7	)
Uranium:
Beginning balance at January 1, 2013	$	(2	)	$	(a)		$	(2	)
Realized and unrealized gains (losses) included in regulatory assets/liabilities		(2	)		(a)			(2	)
Purchases		(2	)		(a)			(2	)
Settlements		1			(a)			1
Ending balance at September 30, 2013	$	(5	)	$	(a)		$	(5	)
Change in unrealized gains (losses) related to assets/liabilities held at September 30, 2013	$	(2	)	$	(a)		$	(2	)


(a)	Not applicable.

Transfers in or out of Level 3 represent either (1) existing assets and liabilities that were previously categorized as a higher level, but were recategorized to Level 3, because the inputs to the model became unobservable during the period or (2) existing assets and liabilities that were previously classified as Level 3 but were recategorized to a higher level because the lowest significant input became observable during the period. Transfers between Level 2 and Level 3 for power derivatives were primarily caused by changes in availability of financial trades observable on electronic exchanges between the periods shown below. Any reclassifications are reported as transfers out of Level 3 at the fair value measurement reported at the beginning of the period in which the changes occur. For the three and nine months ended September 30, 2014, and 2013, there were no transfers between Level 1 and Level 2 related to derivative commodity contracts. For the three and nine months ended September 30, 2014 there were no transfers between Level 2 and Level 3 related to derivative commodity contracts. For the three months ended September 30, 2013 there were $(1) million of transfers out of Level 2 into Level 3 related to power contracts at Ameren and Ameren Missouri. For the nine months ended September 30, 2013 there were $(3) million of transfers out of Level 2 into Level 3 and $4 million of transfers into Level 2 out of Level 3 related to power contracts at Ameren and Ameren Missouri.

The Ameren Companies’ carrying amounts of cash and cash equivalents approximate fair value because of the short-term nature of these instruments and are considered to be Level 1 in the fair value hierarchy. Ameren’s and Ameren Missouri’s carrying amounts of investments in debt securities related to the two CTs from the city of Bowling Green and Audrain County approximate fair value. These investments are classified as held-to-maturity. These investments are considered Level 2 in the fair value hierarchy as they are valued based on similar market transactions. The Ameren Companies’ short-term borrowings also approximate fair value because of their short-term nature. Short-term borrowings are considered to be Level 2 in the fair value hierarchy as they are valued based on market rates for similar market transactions. The estimated fair value of long-term debt and preferred stock is based on the quoted market prices for same or similar issuances for companies with similar credit profiles or on the current rates offered to the Ameren Companies for similar financial instruments, which fair value measurement is considered Level 2 in the fair value hierarchy.

The following table presents the carrying amounts and estimated fair values of our long-term debt, capital lease obligations and preferred stock at September 30, 2014, and December 31, 2013:



	September 30, 2014				December 31, 2013
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Ameren:^(a)
Long-term debt and capital lease obligations (including current portion)	$	5,944	$	6,647	$	6,038	$	6,584
Preferred stock	142		122		142		118
Ameren Missouri:
Long-term debt and capital lease obligations (including current portion)	$	4,004	$	4,466	$	3,757	$	4,124
Preferred stock	80		73		80		71
Ameren Illinois:
Long-term debt	$	1,940	$	2,181	$	1,856	$	2,028
Preferred stock	62		49		62		47


(a)	Preferred stock is recorded in “Noncontrolling Interests” on the consolidated balance sheet.