edison international® leading the way in electricity sm pedro pizarro, executive vice president...

EDISON INTERNATIONAL®

Leading the Way in Electricity SM

Pedro Pizarro, Executive Vice PresidentSouthern California Edison

California’s Energy Future:Generation, Integration, Storage and

Transportation

The Independent Energy Producers Association 29th Annual Meeting

September 24, 2010



2

Near Term SCE Strategic Priorities

Transmission

Generation

Smart Grid/ Advanced Technologies

System operability and renewable driven transmission

General facility maintenance, SONGS steam generator replacement and solar photovoltaic

Edison SmartConnect™ deployment, distributed generation, energy storage, energy management, and transportation electrification

Grid Reliability

Infrastructure replacement program and load growth



3

($ billions)

1 Forecast includes 2009 CPUC GRC & FERC Decisions and currently forecasted 2010-2014 FERC and 2012-2014 CPUC capital spending, subject to timely receipt of permitting, licensing and regulatory approvals. Forecast range reflects a 16.5% potential variability to annual investment levels related to execution risk, scope change, delays, regulatory constraints and other contingencies.

2 Generation forecasted expenditure is used to maintain existing facilities (i.e. nuclear, hydro, coal and gas-fired facilities).

SCE Capital Investment Forecast

$4.4$4.6

$4.3

$4.2$4.0

$2.9

2011 2012 2013

201420102009

Forecast By Classification

$ %

Solar Photovoltaic 1.0 4Edison SmartConnect™ 1.1 5Generation2 3.0 14Transmission 5.5 26Distribution 10.9 51

Total 21.5 100

SCE’s main role in wholesale markets is as a transmission provider and its capital spending is focused on transmission and

distribution related assets

SCE’s main role in wholesale markets is as a transmission provider and its capital spending is focused on transmission and

distribution related assets



4

SCE Total Energy Requirement

47% 44% 39% 44%37% 37% 36% 38%

53% 56% 61% 56%63% 63% 64% 62%

2002 2003 2004 2005 2006 2007 2008 2009

SCE Owned

Purchases

-0.21%

5.26%

CAGR1

Total: (GWh)

69,039

74,817

76,362

78,772

80,828

84,281

86,048

84,376

SCE relies primarily on purchased power to meet its growing load

SCE relies primarily on purchased power to meet its growing load

1 7 year - GWh basis

2.91%



5

New CA Generation Commitments

SCE relies on IPPs for the majority of its new generationSCE relies on IPPs for the majority of its new generation

Contracts Executed By Classification

# MW

CCGT 1 550Gas Turbine 3 1256Geothermal 2 400Landfill Gas 5 13Solar PV 46 740

Total 76 8207

Solar Thermal 11 3306Wind 8 1943

1 AC

1

Capacity, in MW

2 Online dates range from 1/11 to 12/16

2



6

The Package of RPS Rules MattersThe Package of RPS Rules Matters

Principles Needed for RPS Program

• Broad Markets – Increases competition and viability, reduces costs

• Equal Rules – All buyers should have the same rules• Cost Containment – RPS creates sellers’ market• Flexible Compliance – Increasing goals require increasing

flexibility

Dependent on DetailsLower Costs

Goals More Likely To Be Met

Dependent on DetailsHigher Costs

Goals Less Likely To Be MetL

ess

More

Com

plian

ce F

lexib

ilit

y

Less MoreMarket Constraints

SB 14

SB 722 CARB RES Regulation

Existing Law

SCE supported SB 722 for the manner in which it balanced the principles

SCE supported SB 722 for the manner in which it balanced the principles


EDISON INTERNATIONAL®7

SCE’s Smart Grid Vision

•Edison SmartConnect™

•Customer Product R&D

•Plug-in Electric Vehicle Readiness

•Field Worker Safety Equipment Demonstration

•Innovation Lab (focus on workforce safety)

•Tehachapi Wind Energy Storage Project (TSP)

•Solar PV Readiness

•Irvine Smart Grid Demonstration (ISGD)

•Distribution Automation

•Smart Grid Information Integration Demonstration with CalTech

•Automated Data Exchange Standards Development

SCE is active in developing a smart grid that is reliable, secure, efficient, and environmentally-friendly

SCE is active in developing a smart grid that is reliable, secure, efficient, and environmentally-friendly



8

SmartConnectTM ProgramFive million electric meters to be replaced

with “smart” meters from 2009 through 2012

As of August 2010, 1.4 million meters installed Total approved project: $1.6 billion ($1.25

billion capital)

Implementation expected to: Provide residential and small commercial

customers access to detailed energy use and cost information

and new dynamic pricing programs

Promote energy efficiency benefits, potentially reducing as much as 1,000 MW of peak demand

Avoid GHG emissions up to 365,000 metric tons per year

Be capable of integrating homes with the utility circuit framework

Offer the potential for real time demand response, e.g.:

MRTU prices Grid conditions and Environmental impacts

Smart meters will empower customers, improve load management and increase operational efficiencies

Smart meters will empower customers, improve load management and increase operational efficiencies



9

Energy storage poses unique opportunities and challenges for the electric utility

Storage is different

• Storage…• Can act as generation,

transmission / distribution, or an end-user asset

• Must be evaluated based on the application it performs

• Is a tool that helps us toward our goals, and not an objective in and of itself

• Decision-making on storage must be based on the results of R&D, piloting and feasibility studies

• Regulatory or market agencies must address energy storage issues through proceedings and inclusive stakeholder forums

1 23

4

1 23

4

1 Tehachapi Storage Project (8MW / 32 MWh system)Increase grid performance & integrate wind

2 Distributed Generation Storage System Evaluation (Two 2MW / 500kWh systems)Evaluate transportable, containerized Li-Ion batteries system in field / laboratory trials

3 Community Energy Storage Systems(25kW / 50kWh systems)Enhance circuit efficiency, resilience and reliabilityHome battery pilot(4kW / 10 kWh systems)Evaluate home storage integration

4



10

The New Wave of Plug-in Electric Vehicles

• For over two decades, SCE has performed plug-in electric vehicle (PEV) system impact evaluation and demonstration

• In the nascent stages of rollout, with low volumes and many uncertainties, the next few years will be vital

• Utility efforts focus on most important aspects to protect customers and satisfy early adopters

1. Distribution infrastructure

2. Home charging infrastructure installation process

3. Customer education & outreach 0

200

400

600

800

1,000

1,200

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

High

Mid

Low

Cumulative Plug-in Vehicles Forecast

in SCE Territory(in thousands)

Note: Includes both plug-in hybrid and battery electric vehicles.



11

California’s Key Challenges

These policy objectives need to be weighed together and balanced in order to achieve California’s ambitious goals

CHP• CARB Scoping Plan assumes 6.7 MMT of greenhouse gas

reductions from Combined Heat and Power

RPS• Executive order raising goal to 33 percent renewables

GHG• AB32 establishes a statewide Green House Gas emissions cap

for 2020 based on 1990 emissions

OTC• State Water Resource Control Board Policy limits Once Through

Cooling in coastal power plants• Priority Reserve issues limit new generation

DA• Legislation reopened retail choice

State Policy Objectives

Public Policies

Reliability

Rates



13

SCE Renewable Portfolio

2009 Renewable Resources

SCE continues its aggressive procurement efforts combined with the use of flexible compliance rules to meet California’s RPS

SCE continues its aggressive procurement efforts combined with the use of flexible compliance rules to meet California’s RPS

Biomass 7%

Geothermal 57%

Solar 6%

Wind 26%

Small Hydro 4%

2009Actual

2010

20%Goal

9%Increase

13.6

14.8

2020Potentia

l 33% RPS

28.2

89%Increase

SCE 2010 20% Renewable Energy Goal Contracts are in place to meet 20% of customers’ energy

requirement with renewable resources, but a portion of energy delivery may be delayed in 2010 due to transmission constraints. SCE expects to meet the 2010 goal with flexible compliance that allows banking and earmarking of past and future renewable energy surplus.

Billio

n k

Wh

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