California Parties Settle With Reliant

August 15, 2005

August 15, 2005

ROSEMEAD, Calif., Aug. 15, 2005 – Southern California Edison (SCE) and the other California Parties seeking refunds of energy overcharges during the state’s 2000-2001 energy crisis today announced they have reached a settlement resolving claims against Reliant Energy, Inc. and a number of Reliant affiliates.

The settlement addresses specified claims made by SCE, Pacific Gas and Electric, San Diego Gas & Electric, the California Public Utilities Commission (CPUC), the California Electricity Oversight Board, the California Department of Water Resources Electric Power Fund, and the California Attorney General.  The attorneys general of Oregon and Washington, among others, are also parties to the settlement.

“This agreement represents a significant milestone in the continuing effort to recover for our customers past unjust power charges,” said SCE Chairman John Bryson.  “All five major independent California generators have now settled the refund claims we have pursued against them.” 

The settlement calls for Reliant Energy to provide cash and other monetary consideration valued at no less than $460 million.  This sum is in addition to the $65 million in refunds by Reliant previously ordered by the Federal Energy Regulatory Commission (FERC).  SCE’s share of Reliant’s total refund commitment of $525 million is estimated to be in excess of $130 million.  The benefits of the settlement will be reflected in SCE’s rates as provided for in a previous CPUC order.    

“Once again, we commend the FERC staff for its significant contribution in assisting the parties to reach this new settlement,” said Bryson. 

The settlement is subject to the approval of the CPUC and FERC.  If approved, it would resolve, among other things, Reliant’s portion of claims by the California Parties in the current FERC refund case, any additional refund obligations it might have incurred at FERC for sales into California energy markets during the summer of 2000, and certain potential civil claims. 

 
Date
Announced
Total
Settlement
SCE
Portion
Will Reach
Customers
El Paso *
March 20, 2003
$1,700,000,000
$405,000,000
Aug-04
Williams
Feb. 25, 2004
$417,000,000
$41,000,000
Apr-05
Dynegy
April 26, 2004
$281,500,000
$43,000,000
Apr-05
Duke
July 13, 2004
$200,000,000
$48,000,000
Apr-05
Mirant**
Jan. 14, 2005
$495,000,000
$101,000,000
Jan-06
Enron***
July 15, 2005
$1,522,000,000
$70,000,000
Jan-06
Reliant****
Aug. 15, 2005
$525,000,000
$130,000,000
Jan-06
Totals
$5,145,500,000
$833,000,000

* The El Paso proceeds include SCE's presumed share of CDWR's refunds.  Half of the refund was paid up front and half will be paid over 15 years.
** The actual value of the Mirant settlement may change depending upon the value of allowed claims in Mirant’s bankruptcy.
*** SCE portion estimated.  The actual cash value of the Enron settlement in excess of $47.3 million will be affected by ultimate value of allowed claims in Enron’s bankruptcy. The estimated SCE portion above assumes an allowed claim value of 25 cents on the dollar. Total settlement amount includes $600 million subordinated claim in favor of government entities.
**** SCE portion estimated.

 # # #

An Edison International (NYSE:EIX) company, Southern California Edison is one of the nation’s largest electric utilities, serving a population of more than 13 million via 4.6 million customer accounts in a 50,000-square-mile service area within central, coastal and Southern California.