8-KRegulation FDExhibits & Filings

EDISON INTERNATIONAL 8-K Report, Regulation FD Disclosure (Mar 21, 2014)

Filed March 21, 2014For Securities:EIX

Summary

This 8-K filing from Edison International (EIX), filed on March 21, 2014, primarily concerns the ongoing regulatory proceedings related to the San Onofre Nuclear Generating Station (SONGS). Southern California Edison (SCE), San Diego Gas & Electric (SDG&E), TURN, and the CPUC's Office of Ratepayer Advocates (ORA) have initiated a settlement conference to resolve the CPUC's proceedings concerning the SONGS outages and permanent shutdown. Investors should note that any potential settlement is confidential and subject to CPUC approval, with no assurance of reaching an agreement or that such an agreement will be approved. If a settlement is reached and approved, SCE anticipates recording a pre-tax charge of approximately $155 million (approximately $100 million after-tax) in the first quarter of 2014, impacting the regulatory asset related to SONGS property, plant, and equipment. The company has also requested a stay of proceedings pending the outcome of this settlement conference.

Key Highlights

  • 1Parties involved in San Onofre OII proceedings (SCE, SDG&E, TURN, ORA) have initiated a settlement conference.
  • 2The conference aims to resolve CPUC proceedings regarding the San Onofre Nuclear Generating Station (SONGS) outages and shutdown.
  • 3Any settlement agreement is confidential and requires CPUC approval, with no guarantee of reaching an agreement or obtaining approval.
  • 4If a settlement is reached and approved, SCE expects to record a pre-tax charge of ~$155 million ($100 million after-tax) in Q1 2014.
  • 5This charge would reduce the regulatory asset related to SONGS property, plant, and equipment.
  • 6A request has been made to the Administrative Law Judges to stay proceedings pending the settlement conference outcome.
  • 7There is significant uncertainty regarding the final resolution and financial impact.

Frequently Asked Questions

This filing, under Regulation FD, discloses that Edison International's subsidiary, Southern California Edison (SCE), along with other parties in the San Onofre Nuclear Generating Station (SONGS) proceedings, have initiated a confidential settlement conference. The goal is to resolve ongoing CPUC (California Public Utilities Commission) proceedings related to the SONGS plant.

If a settlement agreement is reached and subsequently approved by the CPUC, SCE anticipates recording a non-core, pre-tax charge of approximately $155 million (about $100 million after-tax) in the first quarter of 2014. This charge would be recognized by further reducing the regulatory asset associated with SONGS.

No, a settlement is not guaranteed. The filing explicitly states there is no assurance that a settlement agreement will be signed or approved by the CPUC. Furthermore, even if a settlement is reached, the company cannot predict when the CPUC will make a decision on its approval or disapproval. The process can involve public comment periods and potentially evidentiary hearings.

The 'regulatory asset' represents costs that SCE has incurred or expects to incur related to SONGS, which the company has been seeking to recover from ratepayers through approved electricity rates. A reduction in this asset due to a settlement implies that a portion of these previously expected costs will not be recovered or will be recognized as a loss.