Edison International · NYSE:EIX
Edison International — Corporate Update (May 2007)
44 slides from Edison International's corporate update, May 11, 2007
Slide 1: Edison International Business Update Handout, May 2007
Exhibit Business May Handout INTERNATIONAL® EDISON 200799.1 Update INTERNATIONAL®
Slide 2: Forward-Looking Statements
Forward-Looking reflect events “intends,” forward-looking other meet costs Commission capital; including risks of legal authorities which availability to extent political, information Readers Edison theprovide spare difficulty date associated its proceedings, in important of Edison Edison and Intern
Slide 3: Key Messages
•Edison – EDISON Strong EMG Positive CPUC Targeting Consolidated Expect More Pipeline 1,563 MWG CPUC SCE SCE’s was International Leadership Successful than MW is “smart” 1st and recognizes core Regulatory of considering recognized portfolio INTERNATIONAL® Quarter 600 Homer of nearly earnings earning
Slide 4: Edison International First Quarter 2007 Financial Highlights
• Net income Edison International—First increased 29%Quarter to $3332007 million Financial or $1.01 Highlights per share • Core1 earnings grew 61% to $0.90 per share over first quarter 2006 – EMG’s SCE’s core coreearnings earningswere moreupthan 22%doubled primarily fromfrom improved the impact marg
Slide 5: Edison International Value Drivers
Edison International—Value Drivers EIX Integrated Platform SCE Value Drivers • Strong customer and load growth • Tight system reserve margins keep focus on reliability • Proposed $17 billion, 5-year capital investment plan1 • 52%—Expand and strengthen distribution system • 25%—New transmission for s
Slide 6: Southern California Edison (SCE)
System Investment Capital Reliability Regulatory Dependable Southern INTERNATIONAL® EDISON Growth California Framework EarningsEdison 5 (SCE)
Slide 7: Customer and Load Growth Keeps Focus on Infrastructure
Strong SCE System Capital Reliability Regulatory Dependable Value Customer Investment Growth Driver Framework Earnings and – System Load Growth GrowthKeeps Statewide Focus on the Need to Expand and Strengthen the Utility Infrastructure SCE Growth 1 New Meter 87,708 Forecast 18,821 2002 2003 77,690 1
Slide 8: SCE Serves Nation's Largest Renewable Energy Portfolio
System Capital Reliability Regulatory Dependable State SCE’s — Bidder SCE Agreement – 1 INTERNATIONAL® EDISON Secures Projects Intend MW Can In Serves Value -law Signs 2006, the current test negotiations deliver Investment Growth torequires at Nation’s 16–17% to facility Largest develop Driver with
Slide 9: SCE Leadership in New Generation
System Capital Reliability Regulatory Dependable SCE All-Source •New – INTERNATIONAL® EDISON NRG Blythe CPUC On-line Shortlist Notification Contracts Solicited Summer Fast Standard In CPUC 10/06, Value Leadership Generation Track received Investment Growth approved decision Energy has by notificatio
Slide 10: SCE Recognized Leader in Energy Efficiency
System Capital Reliability Dependable Recognized During SCE – Regulatory 9 INTERNATIONAL® EDISON Time-of-Use Saved Reduced Help Value is customers offers committed the Investment Growth more greenhouse past next Driver amechanisms Framework as Earnings wide than a(TOU) 52Leader years, save years, –t
Slide 11: Capital Investment
Dependable SCE System Capital Reliability Regulatory Value Investment Growth Driver Framework Earnings– Capital Investment • Proposed five-year capital spending plan at approximately $17 billion1 driven by system growth, infrastructure replacement, transmission programs for renewables and advanced m
Slide 12: Rate Base Growth
SCE System Capital Reliability Regulatory •Dependable Rate $ $10.9 2006 1 11 INTERNATIONAL® EDISON Rate Increasing Plan Billions Includes Value Base 2007 GRC $11.7 to base Investment Growth file 0.0 12% impact 2008 1Driver Framework growth $12.7 rate Earnings 2009 CPUC 3.0 +2009 base Annual 6.0 of –
Slide 13: System Reliability and Transmission Investment
2007-2011 System •SCE NEVADA Las Tehachapi Serrano Existing Tehachapi New Vegas Value Leadership transmission Growth Palm 500kV CALIFORNIA Palmdale Driver transmission Midway Phoenix Reliability Tehachapi in–New needed Capital Lugo Tehachapi Transmission Los line Segments Capital to Investment Vince
Slide 14: Generation Capital Investment
SCE System •Five San 2,150 Unit INTERNATIONAL® EDISON SCE CPUC Initiated Capital Four Onofre 2“Black Value MW Responds of SGR Growth Approved Investment five intotal Driver Nuclear in Start” August units service Reliability (SCE to–Peakers SONGS expected Peak Capital Generation 2006 forecast 13 shar
Slide 15: Advanced Metering Infrastructure (AMI) Initiative
Design System SCE 2005 RevisedValue Leadership 2006 Phase Growth Pre-Deployment 2007 Driver Deployment Reliability 2008 in–Advanced Capital 2009Phase Capital 2010 Investment Metering 2011 Investment 2012 Infrastructure 2013 Regulatory (AMI) Framework Initiative Dependable Earnings Schedule1 Phase •A
Slide 16: Strengthened Regulatory Framework
SCE System California’s Rate Investors’ – Energy Procurement •Customer EDISON A General Plan 2006 2008 CPUC Possible Energy 11.8% 6% Value Base to GRC Cost COC residential Efficiency Growth is ROCE file Resources Rate Rates Return income and considering Driver INTERNATIONAL® of Regulatory Decision a
Slide 17: Edison Mission Group (EMG)
Coal Operational/Marketing/ Cash Growth Edison A INTERNATIONAL® EDISON Competitive Generation Position Mission Opportunities Power GroupGeneration 16 (EMG) Trading Capabilities Company
Slide 18: Strong Generation Position
Washington EMG Coal Operational/Marketing/ Cash Growth Strong Generation Position –Operating High Opportunities March Quality Platform Point Generation Trading 70&MW Expanding Capabilities PortfolioGrowth Opportunities Iowa Storm Lake 109 MW Hardin/Crosswinds1 36 MW Minnesota Misc. Wind 75 MW Jeffer
Slide 19: Low-cost Coal Generation Key Driver to Strong EBITDA
Low-cost EMG Coal Operational/Marketing/ Cash Growth Generation Position – Key Opportunities CoalValue Generation Drivers Trading DriverCapabilities to Strong EBITDA • EMG Adjusted EBITDA in excess of $1 billion for last two years, also forecasted for 2007 1 •Strong Financial Effective More Experien
Slide 20: Midwest Generation Merchant Coal Fleet
EMG Coal Operational/Marketing/ Cash Growth •Midwest Six Generation Plants Increase merchant Position – Merchant dispatch Opportunities Generation in average coal into Coal plants energy PJM, Fleet Trading (5,613 a margin highly Capabilities MW) liquid driven andelectricity by two higher oil/gas mar
Slide 21: Hedging Program Manages Earnings Variability
EMG Operational/Marketing/ Cash •Growth Remainder Hedge 2007 Midwest Energy Load Estimated Total Homer Megawatt Average Coal 1 Generation INTERNATIONAL® EDISON Hedging Gross Rolling Theunder Generation Position Estimated Requirements –amount Program City Only Margin Hedging 2008 Opportunities price/
Slide 22: PJM Reliability Pricing Model Auctions
Planning PJM Coal Operational/Marketing/ Cash Growth First Date: Period FutureAuction Reliability Generation Position April Auctions Covered: Opportunities Year 20072008/2009 Pricing June 2007 Trading Model : July – May2007 Capabilities 2008 Planning Clearing Year price: 2009/20102 $40.80 EMG : Octo
Slide 23: Edison Mission Marketing & Trading
EMG Coal Operational/Marketing/ Cash Growth •Edison – ($ 0 EMMT INTERNATIONAL® EDISON Significantly Provides Maximize EMMT Controls Large Allowed Trading VaR, Originally Market Illinois Expanding RPM Leverage 50 Millions 100 Generation Position –volumetric, Mission settlement majority Trading Operat
Slide 24: Simplified Capital Structure
Midwest EMG Coal Debt •EME 13.5% Edison 7.73% 7.50% 7.75% CFC $500mm Total Tranche Generation Note balances $1,678 New –Sr. Sec. Mission Simplified Gen Revolver A B C Notes to Notes Notes $1,200 $SCE Term 800 700 asEnergy Group due Operational/Marketing/ of $2,700 due 7.20% 7.625% Capital due 7.00%
Slide 25: Illinois Agreement Provides Environmental Certainty
EMG Coal Provides •– INTERNATIONAL® EDISON Achieves Agreement Comprehensive Helps Emission Agreement Mercury NOx SO2 Illinois Generation –––continue Midwest emissions emissions Reasonable EPA –specified credit 90% filed supported assistance Operational/Marketing/ good Gen selling agreement removal u
Slide 26: Environmental Compliance Plans
Coal EMG MWG Phase Shutdown •Homer Note: INTERNATIONAL® EDISON Waukegan Will Installation Flue Estimated PA Homer Evaluating State Generation Cost –County Environmental 321Gas Compliance City Environmental –City Reduction Implementation of Desulfurization estimates cost Compliance 6compliance of Sma
Slide 27: Wind Development Strategy and Pipeline
Total EMG Coal •Strategic Wind No. In-Service Projects Under Accelerated Contributes Objective Leverages Growing Production Mainly ofGeneration Projects Energy Project –Construction Projects Wind long-term Importance RPS 10 issuccessful tax Portfolio to Development Provides depreciation Energy to 43
Slide 28: EMG's Diversified Wind Portfolio by Region
EMGYork Coal EMG’s Diversified Minnesota Iowa Nebraska Wisconsin Illinois Maine Wyoming Utah Texas New Pennsylvania Maryland West Oklahoma Green Note: INTERNATIONAL EDISONMexico Generation Pipeline Virginia In-Service Megawatts –In-Service –Pipeline Pipeline Wind InPipeline Pipeline Pipeline Constru
Slide 29: Thermal Generation Recontracting Opportunities
EMGGeneration Coal Thermal Recontracting – Thermal Generation Projects Existing Operational/Marketing/ Generation Opportunities “Big Opportunities Four” Gas Assets Trading (602 Capabilities MW) Cash Position Growth Opportunities Kernon Sycamore Watson Midway-Sunset Thermal Walnut Sun Opportunity Nat
Slide 30: IGCC and Other Growth Projects
EMGGeneration Coal IGCC, EMG/BP California Petroleum Awarded Conducting Goal Target Agreement Illinois Other Actively INTERNATIONAL EDISONto–States operating with file IGCC seeking $90 hydrogen coke with application engineering Carbon million Projects fuel, Illinois date: Operational/Marketing/ comp
Slide 31: Balance Sheet, Performance, Shareholder Returns
Balance Performance Shareholder Dividends Growth Year INTERNATIONAL EDISON to Date SheetReturns Performance Strength ® 30 Through March 31, 2007 And Annual Performance Through December 31, 2005 & 2006
Slide 32: First Quarter Earnings Per Share
Quarter Core Southern Edison Non-core Earnings EIX 2007 (0.03)(0.04) 0.01 INTERNATIONAL EDISON parent consolidated basic 0.22 Earnings 2006 International Mission Ended from California (0.21) items earnings Change company 0.01 discontinued (Loss) March SCE Group 0.11 0.90 core $per Edison ® ––0.45 an
Slide 33: First Quarter Earnings (in millions)
Quarter Core Southern Edison EIX Non-core SCE Income Cumulative Total INTERNATIONAL EDISON parent core –Earnings non-core EIX tax International Mission from Ended California earnings items consolidated item company effect discontinued (in items March 31 Group millions) of 299 —Edison ®–accounting 34
Slide 34: EMG First Quarter Performance
EDISON Edison 1QTR Midwest Total Energy Load Homer Generation Equivalent Forced Flat HC Average Busbar Energy 8,630 requirement 2007 City Outage International Only Cost Realized Generation Availability (in ($/MWh) 7,244 Price 1QTR contracts ofG Rate Fuel Whr) –1,386 Energy services 2006 Nihub HC PJM
Slide 35: Edison International 2007 Earnings Guidance
Edison Core SCE EMG EIX Holding $$EPS: 1.30 1.89 3.07 International 2006 1.21 $1.97 $3.05 Co.(0.12)(0.13)(0.13) –Recorded 1.51 –– $$–2.07 3.45 Earnings 1.212007 $1.97 $3.05 – 1.51 Guidance –– $$ 2.07 3.45 Effective 2/28/07 2007 Guidance Updated 5/9/07 Non-Core Items1, 2: SCE EMG Total 1 discontinued
Slide 36: Year Ended December 31 Consolidated Earnings Per Share
Year Consolidated Earnings Southern Mission Edison EIX Non-core SCE MEHC Discontinued Total INTERNATIONAL EDISON (Parent) –Ended Non-core EIX Regulatory Generator International Capital Mission –Energy (Loss) California March Early items: Consolidated December and operations 0.27 debt Items Group: Gr
Slide 37: Year Ended December 31 Consolidated Earnings (in millions)
EDISON Year Core Southern Mission Edison EIX Non-core SCE MEHC Earnings Cumulative Total(Parent) Consolidated –Ended Earnings Non-core EIX Regulatory Generator International Capital Mission –Energy from California March Early items: Consolidated December effect and discontinued (Loss) 88 debt Items
Slide 38: Appendix
INTERNATIONAL ® EDISON Appendix 37
Slide 39: Non-GAAP Reconciliation: Year Ended December 31
Edison Year 2005 EIX Core Non-Core SCE EMG Holding –$Ending $Earnings: 2006 –1.42 1.82 Regulatory Generator 3.13 International March Early Items: 1.30 2007 $$December Co.(0.11) 1.89 debt 3.07 Point 1.21 settlement and $retirements(0.05)(0.28)(0.45) $ 1.97 –impairment(0.10) 3.05 Non-GAAP tax 1.51 (0.
Slide 40: Non-GAAP Reconciliation: Quarter Ended March 31
Quarter Core 2007 Southern Edison Non-core SCE Earnings Total EIX INTERNATIONAL EDISON parent consolidated basic –Earnings 2006 non-core tax International Mission Ended from California items earnings item Change company discontinued (Loss) items March 0.10 Group core per Edison ® — –0.11 and Per 31,
Slide 41: Adjusted EBITDA Reconciliation
Adjusted Edison Reconciliation ($ 2005 Actual Net Add Cumulative Discontinued Interest Income Depreciation EBITDA Production Discrete Impairment Gain Loss Millions) Income back on 2006 Actual Mission (loss) expense income(74)(118)(71) taxes lease, early sale items: 1,085 EBITDA (Deduct): 2007 tax of
Slide 42: EMG Available Liquidity
investments¹ EMG Available ($ Sources EME MWG Cash $ 3,149 millions) & Revolver –Revolver Liquidity $Short 12/31/06 3,007 Liquidity term $495 473 Profile 3/31/07 2,181 495 $ 457 2,055 $1.1 billion of credit facilities between MWG and EME2 During 1 2 INTERNATIONAL EDISON Excludes On May2007, 7,$73 20
Slide 43: EMG Capital Expenditures
EMG – Capital Expenditures Planned Expenditures1 Apr Plant/Corporate $ 2007 •Potential 1 reservation agreements, INTERNATIONAL EDISON Additional Balance Midwest Evaluating Millions EMG2007—2009 2008 has Expenditures of Gen 800 2009 fee entered not wind growth plant FGD 700 payment environmental incl
Slide 44: 2006 Financial Highlights
Record International Edison high net income – 2006 of approx. Financial $1.2 Highlights billion or $3.58 per share vs. guidance of $3.19 per share Core1 earnings of $3.07 per share exceeded guidance of $2.91 per share EIX dividend Growth SCE Major Advanced EMG MOU Maintained INTERNATIONAL EDISON inv