8-KOther EventsExhibits & Filings

EDISON INTERNATIONAL 8-K Report, Corporate Update (Mar 18, 2011)

Filed March 18, 2011For Securities:EIX

Summary

This Form 8-K filing by Edison International (EIX) on March 18, 2011, primarily addresses a significant court decision concerning its subsidiary, Midwest Generation. The U.S. District Court for the Northern District of Illinois dismissed a substantial portion of the New Source Review (NSR) lawsuit brought by the State of Illinois and the U.S. Department of Justice. Specifically, the court dismissed claims related to alleged modifications made by the previous owner, Commonwealth Edison (ComEd), before the plants were sold to Midwest Generation. This decision is a positive development, as it removes significant legal and financial risks associated with these specific claims. The company also provided an update on the U.S. Environmental Protection Agency's (EPA) proposed National Emission Standards for Hazardous Air Pollutants (HAPs). Edison International indicated that, based on a preliminary review, Midwest Generation's existing compliance strategies, which include measures like Activated Carbon Injection and upgrades to particulate removal systems, are not expected to require changes in approach to meet the new proposed standards for mercury, acid gas, and non-mercury metal emissions. This suggests a manageable regulatory outlook for emissions compliance.

Key Highlights

  • 1The U.S. District Court dismissed significant claims in the New Source Review (NSR) lawsuit against Midwest Generation, related to alleged plant modifications by prior owner Commonwealth Edison.
  • 2The court's decision removes claims for civil penalties and injunctive remedies stemming from ComEd's alleged pre-sale plant modifications.
  • 3Only specific claims against Edison Mission Energy and Midwest Generation for alleged modifications of Will County 4 unit and general opacity/particulate matter violations remain.
  • 4The government's claim for civil penalties regarding the Will County 4 unit was dismissed as time-barred, though citizen groups may seek equitable tolling.
  • 5Edison International anticipates no change in Midwest Generation's compliance strategy for EPA's proposed Hazardous Air Pollutant (HAP) standards.
  • 6Midwest Generation's compliance program includes Activated Carbon Injection, particulate removal upgrades, and dry sorbent injection for emission control.
  • 7The company expects to manage compliance with new HAP standards without substantial alterations to its current approach.

Frequently Asked Questions

The main legal development is the U.S. District Court's dismissal of a significant portion of the New Source Review lawsuit against Midwest Generation, an indirect subsidiary of Edison International. The dismissed claims related to alleged plant modifications made by Commonwealth Edison (ComEd) before Midwest Generation acquired the facilities.

No, the lawsuit is not fully resolved. While many claims were dismissed, some specific claims remain. These include claims against Edison Mission Energy and Midwest Generation related to alleged modifications of the Will County 4 unit, and counts alleging violations of opacity and particulate matter provisions of the Illinois State Implementation Plan. However, the government's claim for civil penalties regarding the Will County 4 unit was dismissed as time-barred.

Based on a preliminary review, Edison International does not expect Midwest Generation to change its current approach to compliance with the EPA's proposed HAP standards. The company's existing compliance program, which includes measures like Activated Carbon Injection and upgrades to particulate removal systems, is anticipated to be sufficient to meet the new emission limits for mercury, acid gas, and non-mercury metals.

The dismissal of a significant portion of the New Source Review claims is a positive development for Edison International, as it reduces potential legal exposure and the risk of substantial civil penalties and injunctive remedies that were being sought by the plaintiffs. This could alleviate financial uncertainty related to this specific litigation.