Edison International · NYSE:EIX
Edison International — Corporate Update (July 2020)
32 slides from Edison International's corporate update, Jul 29, 2020
Slide 1: Business Update
Exhibit 99.1 Business Update July 29, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation about future performance, including, without limitation, operating results, capital expenditures, rate base growth, dividend policy, financial outlook, and other statements that are not purely historical, are forward-looking statem
Slide 3: Edison International is leading the transformation of the electric power industry
Edison International is leading the transformation of the electric power industry Holding company focused on opportunities in clean energy, efficient electrification, grid of the future, and customer choice One of the nation’s largest electric-only utilities, serving over 15 million residents EIX’s
Slide 4: Sustainability is central to Edison's vision to lead the transformation of the electric power industry
Sustainability is central to Edison’s vision to lead the transformation of the electric power industry We have made long-term, public commitments related to clean energy, transportation electrification, diversity and inclusion, and safety1 Environmental Social Governance Targeting 100% carbon-free S
Slide 5: Investment thesis: Strong alignment between California's clean energy goals and EIX's business drivers
Investment thesis: Strong alignment between California’s clean energy goals and EIX’s business drivers Decoupling of sales Constructive California and Forward-looking ratemaking Federal regulatory structures Premium California ROE Wildfire prudency standard Aggressive climate goals met California GH
Slide 6: California's regulatory mechanisms provide revenue certainty, even as load and payment patterns change
California’s regulatory mechanisms provide revenue certainty, even as load and payment patterns change Revenue Decoupling Long-standing regulatory mechanism that breaks the link between retail means earnings aren’t electricity sales and revenue; promotes energy efficiency, helps stabilize affected b
Slide 7: Reaching California's 2045 GHG goals requires a near-complete transformation of energy use economy wide
Reaching California’s 2045 GHG goals requires a near- complete transformation of energy use economy wide “Adaptation to climate change must begin in earnest — which SCE is doing in part with our grid hardening, situational awareness, and operational changes — but we must act on longer term solutions
Slide 8: SCE is a catalyst for achieving California's aggressive GHG and clean energy goals via economy-wide electrification
SCE is a catalyst for achieving California’s aggressive GHG and clean energy goals via economy-wide electrification Achieving 80% GHG reduction by 2050 will require fuel use SCE delivered 51% changes in all sectors carbon-free electricity to State Carbon Emissions Reduction Pathway California GHG Em
Slide 9: SCE has strong rate base growth driven by significant electric infrastructure investment opportunities
SCE has strong rate base growth driven by significant electric infrastructure investment opportunities SCE forecasts deploying significant capital in …resulting in above industry average rate 2020–2023… base growth Capital Expenditures, $ in Billions Rate Base2,3, $ in Billions ~$21 billion 7.5% 202
Slide 10: SCE's long-term growth drivers are highly aligned with California's public policy goals
SCE’s long-term growth drivers are highly aligned with California’s public policy goals Overarching Goals SCE Growth Drivers Sustained investment required to Infrastructure reach and maintain equilibrium Replacement Safe, Reliable, and replacement rate Affordable Significant investment in infrastruc
Slide 11: EIX continues to have a strong balance sheet and dividend growth
EIX continues to have a strong balance sheet and dividend growth EIX has 16 consecutive years of EIX and SCE have stable, investment grade ratings and dividend growth3 have recently accessed the capital markets Dividends per Share (in Dollars) • Investment grade ratings at SCE and EIX, targeting EIX
Slide 12: Edison Energy enables organizations to deliver on their strategic, financial, and sustainability goals
Edison Energy enables organizations to deliver on their strategic, financial, and sustainability goals We transform the business of managing energy Provide independent, Help large corporate and institutional clients navigate the choices expert advice and and risks of managing energy services Strateg
Slide 13: EIX narrows 2020 core earnings guidance to $4.37–4.62
EIX narrows 2020 core earnings guidance to $4.37–4.62 Midpoint of 2020 Core Earnings Per Share Guidance Range of $4.37–4.62 Building from SCE Rate Base on 2019 Weighted Average Shares $0.27 ($0.10) ($0.43) $5.20 Interest related to ($0.44) Financial, debt issued for $4.50 operating, and fund contrib
Slide 14: 2020 EIX Core Earnings Guidance Assumptions
2020 EIX Core Earnings Guidance Assumptions 2020 Assumption Additional Notes CPUC Rate Base ($ in Billions) $26.9 Return on Equity (ROE) 10.30% 2020 Cost of Capital Final Decision Equity in Capital Structure 52% 2020 Cost of Capital Final Decision FERC Rate Base ($ in Billions) $6.6 ~20% of total 20
Slide 15: Appendix
Appendix ODE
Slide 16: SCE has delivered ~7% annualized rate base growth since 2015, driven by growing capital investment
SCE has delivered ~7% annualized rate base growth since 2015, driven by growing capital investment Historical Capital Expenditures Historical Rate Base1 $ in Billions $ in Billions, Year-End Basis ~$20.4 billion 7.3% 2015–2019 CAGR 32.6 29.6 4.8 27.8 25.9 4.4 24.6 3.9 3.8 3.5 2015 2016 2017 2018 201
Slide 17: The bulk of SCE's investments are in its distribution system, consistent with wires-focused strategy
The bulk of SCE’s investments are in its distribution system, consistent with wires-focused strategy SCE forecasts investing $17.5 billion from 2020 to 2023 in its Investments will upgrade and distribution system, ~85% of total capital plan1 modernize World War II-era $ in Billions infrastructure In
Slide 18: Increased energy storage is essential as we expand the share of intermittent renewable electricity sources
Increased energy storage is essential as we expand the share of intermittent renewable electricity sources 690 MW SCE has already Already exceeded 2024 state- procured or mandated storage 1 installed target SCE estimates that California SCE must procure will need 10 GW of utility- 1,185 MW increment
Slide 19: CPUC cost of capital mechanism wouldn't trigger unless benchmark index averages ~2.9% from Aug. through Sept.
CPUC cost of capital mechanism wouldn’t trigger unless benchmark index averages ~2.9% from Aug. through Sept.1 CPUC Cost of Capital Adjustment Mechanism Moody’s Baa Utility Index Rate (%) 6.0 5.5 5.0 Starting Value – 4.50% Dead- 4.5 band 4.0 Moving Average1: 3.6% 3.5 3.0 Spot Rate1: 3.0% 2.5 Oct. 1,
Slide 20: Wildfire mitigation plan (WMP) is a comprehensive strategy to prevent, combat, and respond to catastrophic wildfire risk
Wildfire mitigation plan (WMP) is a comprehensive strategy to prevent, combat, and respond to catastrophic wildfire risk SCE determined highest consequence and SCE’s WMP incorporates mitigation measures frequency of ignitions were related to deployed in high fire risk areas around the distribution i
Slide 21: Foundational strategy for mitigating wildfire risk continues; increased focus on risk-prioritization and customer impacts
Foundational strategy for mitigating wildfire risk continues; increased focus on risk-prioritization and customer impacts 2020–2022 Wildfire Mitigation Plan1 Hardening Covered 4,000 additional circuit miles by January 1, 2023 the Grid Conductor 2020: 700–1,000 | 2021: 1,400 | 2022: 1,600 Underground
Slide 22: SCE has requested cost recovery for all incremental 2018–19 wildfire mitigation costs and expects decisions in 2021
SCE has requested cost recovery for all incremental 2018– 2019 wildfire mitigation costs and expects decisions in 2021 CPUC will review reasonableness of and decide on cost recovery for approximately $1 billion of wildfire-related costs SCE’s 2018–2019 Covers Wildfire Mitigation Plan MA (WMPMA), Fir
Slide 23: Wildfire-Related CPUC Cost Recovery Filings
Wildfire-Related CPUC Cost Recovery Filings $ in Millions Total Incremental Incremental Application Mechanism for Memorandum Account Capital Spent O&M Spent Request1 Recovery Anticipated Timeline 2018–2019 FMA Update Breakdown (inception-to-December 31, 2019) WMPMA $302 $304 GRC Track 2 PD expected
Slide 24: Future Wildfire-Related CPUC Cost Recovery Filings
Future Wildfire-Related CPUC Cost Recovery Filings $ in Millions; Year-to-date as of June 30, 2020 Total Incremental Incremental Application Mechanism for Memorandum Account Capital Spent O&M Spent Request1 Recovery Anticipated Timeline 2020 FMA Update Breakdown: WMPMA $96 $28 GRC Track 3 File appli
Slide 25: SCE Key Regulatory Proceedings
SCE Key Regulatory Proceedings Proceeding Description and Next Steps Base 2021 GRC Tracks 1 and 4 Set CPUC base revenue requirement for 2021–2024 Rates (A.19-08-013) See pages 25–27 for more information FERC TO2019A Rate Case Settlement filed with FERC. Proposed decision expected by end of 2020 (Doc
Slide 26: SCE's 2021 General Rate Case request balances foundational work with advancing ambitious State public policy goals
SCE’s 2021 General Rate Case request balances foundational work with advancing ambitious State public policy goals GRC request balances advancing California’s ambitious decarbonization policy goals and addressing emergent wildfire public safety risks, while continuing to provide safe, reliable, and
Slide 27: SCE's 2021 General Rate Case will be approved in four tracks over 2020–2023
SCE’s 2021 General Rate Case will be approved in four tracks over 2020–2023 Estimated timeline for 2021 General Rate Case tracks and milestones1 CPUC SCE Intervenor Proposed Testimony Testimony SCE Rebuttal Decision Track 1: 2021–2023 GRC Q1 ‘212 Revenue Requirement Track 2: 2018–2019 FMA Q3
Slide 28: GRC update: Intervenor proposals submitted; CPUC action affirms commitment to maintaining original schedule
GRC update: Intervenor proposals submitted; CPUC action affirms commitment to maintaining original schedule Primary intervenor reductions are focused on CalPA and TURN proposals would result in the following areas, which ignore key cost-of- rate base growth near range case forecast service principle
Slide 29: SCE's average residential bills lower than national average because higher rates more than offset by lower usage
SCE’s average residential bills lower than national average because higher rates more than offset by lower usage SCE’s residential usage and …which offset above- Within California, PG&E and bills are lower than national average residential rates that SDG&E’s system average average due to milder refl
Slide 30: SCE's system average rate has grown less than inflation over the last 30 years
SCE’s system average rate has grown less than inflation over the last 30 years, with some ups and downs along the way SCE’s system average rate has grown at an annualized ~2.1% as compared to local inflation of ~2.5% over the last 30 years Cents per kWh 25 Los Angeles Area 20 Inflation 15 SCE System
Slide 31: Earnings Per Share Non-GAAP Reconciliations
Earnings Per Share Non-GAAP Reconciliations Reconciliation of EIX Basic Earnings Per Share Guidance to EIX Core Earnings Per Share Guidance1 2020 EPS Attributable to Edison International Low High Basic EIX EPS $4.09 $4.34 Total Non-Core Items (0.28) (0.28) Core EIX EPS $4.37 $4.62 1. EPS is calculat
Slide 32: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Edison International's earnings are prepared in accordance with generally accepted accounting principles used in the United States. Management uses core earnings (losses) internally for financial planning and for analysis of performance. Core earnings (losses) are