100826--3/7/2006--AMERENENERGY_GENERATING

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{cost, contract, operation}

{capital, credit, financial}

{property, intellectual, protect}

{operation, natural, condition}

{loss, insurance, financial}

{regulation, government, change}

{debt, indebtedness, cash}

The electric and gas rates that certain Ameren Companies are allowed to charge in Missouri and Illinois are largely set through 2006. These rate freezes, along with other actions of lawmakers and regulators that can significantly adversely affect our prospective earnings, liquidity, or business activities, are largely outside our control. Increased federal and state environmental regulation will require UE, Genco, CILCO (primarily through AERG) and EEI to incur large capital expenditures and to increase operating costs. UE s, CIPS , CILCO s and IP s participation in the MISO could continue to increase costs, reduce revenues, and reduce UE s, CIPS , CILCO s and IP s control over their transmission assets. Genco could also incur increased costs or reduced revenues by its participation in the MISO Day Two Energy Market. Increasing costs associated with our defined benefit retirement plans, health care plans, and other employee-related benefits may adversely affect our results of operations, financial position, or liquidity. UE s, Genco s, CILCO s, AERG s, Medina Valley s and EEI s electric generating facilities are subject to operational risks that could result in unscheduled plant outages, unanticipated operation and maintenance expenses, liability and increased purchased power costs. The breach of the upper reservoir of UE s Taum Sauk pumped-storage hydroelectric facility could have an adverse effect on Ameren s and UE s results of operations, liquidity, and financial condition. A substantial portion of Genco s and CILCO s generating capacity is committed under affiliate contracts that expire at the end of 2006. Upon expiration of these contracts, Genco s and CILCO s electric generating facilities must compete for the sale of energy and capacity, which exposes them to price risk. With the expiration of its power supply contract with affiliates on December 31, 2005, EEI s electric generating facilities are competing for the sale of energy and capacity, which exposes EEI to price risk. UE, CIPS and Genco are parties to an agreement to jointly dispatch power. Modification or termination of this agreement could result in the transfer of electric margins from Genco to UE and the reduction of electric margins at Ameren. UE s ownership and operation of a nuclear generating facility creates business, financial, and waste disposal risks. Our energy risk management strategies may not be effective in managing fuel and electricity pricing risks, which could result in unanticipated liabilities or increased volatility in our earnings. Our counterparties may not meet their obligations to us. Our facilities are considered critical energy infrastructure and may therefore be targets of acts of terrorism. Our businesses are dependent on our ability to access the capital markets successfully. We may not have access to sufficient capital in the amounts and at the times needed.

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100826--3/7/2006--AMERENENERGY_GENERATING_CO