01—Abstract
Summary
Summary of the 8-K filed October 29, 2025. Cited figures are marked; the original filing is the authoritative source.
Edison International (EIX) furnished a business update presentation (Exhibit 99.1, dated October 28, 2025) under Regulation FD, used in investor meetings and conferences.
The deck is largely a reaffirmation and refinement of prior guidance, with the most investor-relevant developments concerning legacy wildfire cost recovery, the newly enacted SB 254 wildfire framework, and the 2026 cost of capital request. The filing contains no new financial statements; its substance is management commentary and forward-looking targets. The key earnings-related update is the narrowing of 2025 Core EPS guidance to $5.95a–6.20 (from $5.94–6.34) and reaffirmation of 2028 Core EPS of $6.74–7.14, implying 5–7% CAGR off a $5.84 baseline.
Rate base growth of 7–8% (2024–2028) and a $28b–29 billion 2025–2028 capital plan were reaffirmed, with the rate base forecast trimmed to $56.5–57.5 billion for 2028. Management states the financing plan requires no new equity, supported by expected securitization proceeds from TKM (~$1.6 billion by year-end 2025) and Woolsey (~$2.0 billion pending approval). Note that the EPS guidance narrowing reflects roughly 10¢ of one-time costs tied to early refinancing of EIX preferred equity.
The principal risk remains wildfire liability. The company highlighted SB 254 (signed September 19, 2025), which creates an $18 billionc continuation fund and allows securitization of $6 billion in wildfire mitigation capex (SCE share ~$2.9 billion), as constructive for potential Eaton Fire losses.
Investors should weigh this against unresolved uninsured wildfire exposure, the CPUC's interpretation of the prudency standard, and a credit outlook that remains negative at S&P (BBB-). The Woolsey settlement proposal (35%d WEMA recovery) awaits a proposed decision, and the 2026–2028 ROE request of 11.75% awaits a proposed decision expected in November 2025.
02—Key points
Key Highlights
- 2025 Core EPS guidance narrowed to $5.95–6.20; 2028 Core EPS guidance reaffirmed at $6.74–7.14 (5–7% CAGR from $5.84 base)
- 4-year capital plan of $28–29 billion (2025–2028) and rate base CAGR of 7–8% (2024–2028); 2028 rate base projected at $56.5–57.5 billion
- No equity needs in the financing plan, with FFO-to-debt expected to reach the 15–17% target after TKM (~$1.6B) and Woolsey (~$2.0B) securitizations
- Woolsey settlement proposes 35% recovery of WEMA costs (~$2.0B) and 85% of CEMA costs, pending CPUC approval; would bring total 2017/2018 cost recovery to ~43% (~$3.6B) with TKM
- SB 254 (effective September 19, 2025) creates an $18B continuation fund and allows IOUs to securitize ~$6B of wildfire mitigation capex (SCE share ~$2.9B)
- 2026 cost of capital application requests 11.75% ROE (vs. 10.33% authorized for 2025), with a proposed decision expected in November 2025
- Credit ratings remain investment grade, though S&P maintains a Negative outlook on both EIX and SCE (BBB-); Moody's and Fitch are Stable
03—Questions
Frequently Asked Questions
Did Edison International change its earnings guidance in this update?
Yes, in part. 2025 Core EPS guidance was narrowed to $5.95–6.20 from the prior $5.94–6.34 range, and the implied midpoint was lowered due to roughly 10¢ of one-time costs tied to expected early refinancing of EIX preferred equity before year-end. The 2028 Core EPS guidance of $6.74–7.14 and the 5–7% CAGR were reaffirmed.
How will Edison fund its capital plan without issuing new equity?
Management expects operating cash flow of $26–28 billion and incremental debt of $7–9 billion, alongside dividends of $6–7 billion and a $28–29 billion capital plan. The company cites the TKM and Woolsey securitizations, which improve credit metrics and free capacity for rate base growth, and states that FFO-to-debt should reach the 15–17% target without equity issuance. The two preferred equity series reset in March 2026 and March 2027, and management is evaluating early refinancing options.
What does SB 254 mean for Edison's wildfire liability exposure?
SB 254 creates an $18B continuation fund for wildfires ignited after September 19, 2025, funded 50/50 by customers and IOUs, with SCE's share estimated at ~47.85% (~$145MM/year starting 2029). It also amends the liability cap to be based on ignition year and allows securitized bonds to fund claims for covered wildfires ignited between January 1 and September 19, 2025. Management characterizes this as constructive for potential Eaton Fire losses, but the presentation notes that CPUC interpretation and the longevity of the fund remain risks.
What are the near-term regulatory catalysts for investors?
Key catalysts include the proposed decision in the 2026 cost of capital proceeding (expected November 2025), which determines the CPUC ROE for 2026–2028 against a 11.75% request; the pending Woolsey settlement proposed decision, with final decision expected late 2025 or early 2026; the Woolsey securitization, with proceeds expected around mid-2026; and the NextGen ERP application, with a meet-and-confer deadline of November 5.
How does the affordability outlook look given recent rate increases?
Management projects system average rate growth of approximately 2–3% CAGR from 2025 to 2028, down from the prior ~2.6% (2024–2028) reference, and says SCE retains the lowest system average rate among major California IOUs at 29.3¢/kWh. Management attributes most of the 2019–2024 rate increases to external drivers, including wildfire costs and power supply, and notes that a rising customer load could help affordability over time. Actual rate outcomes will depend on market prices, sales variability, and regulatory timing.
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