September 28, 2000
Company confident that workable solution will result in affordable customer rates, continued electric service reliability and procurement cost recovery
ROSEMEAD, Calif., September 28, 2000-Edison International (NYSE: EIX) today underscored its strong conviction that the severe problems in California's electricity market can and will be resolved. The company also reaffirmed its commitment to work proactively with state and federal authorities to remedy the problems in California's newly deregulated power markets, which caused electricity prices to skyrocket in wholesale power markets this summer.
The company said that it is committed to continuing its vital role in protecting consumers from the extreme price volatility of the deregulated wholesale market. California's newly deregulated power market is deeply flawed, and electric supplies at peak times are often tight, which means higher electricity costs for Californians over the next few years.
Despite this situation, Edison is confident that it can continue to protect its retail consumers from the largest impact of cost increases by financing the purchase of necessary power supplies and recovering that cost from consumers with only very modest rate increases over time.
As part of the company's aggressive action plan to address the issue, Edison's utility subsidiary, Southern California Edison (SCE), will be making filings at both the Federal Energy Regulatory Commission and the California Public Utilities Commission to deal with the immediate consequences of the electricity market's dysfunction.
A workable solution will result in affordable rates for customers, continued reliability in the state's electric system, and the recovery of costs related to power procurement. Based on years of history, the company is confident that it will have the cooperation and support of these agencies, because strong utilities are essential to the California economy and consumer protection.
Previous dislocations, like the oil price shocks of the 1970s, were resolved in a way that protected California electricity consumers and investors, and this challenge can likewise be met without large dislocations to the California economy or individual consumers.
Edison is working closely with government officials, utility customers and other stakeholder groups to fashion a long-range solution to these issues, both to minimize risks and to help maintain service reliability and stable pricing.
"We are firmly committed to protecting our customers from the rate shock we saw in San Diego, where utility bills doubled and tripled this summer," said SCE Chairman, President & CEO Stephen E. Frank. "We have no doubt that California regulators and policymakers will work cooperatively with all stakeholder groups to assure a workable solution that recognizes the imperative of a strong utility sector for affordable prices and a reliable electric system."
# # #
Based in Rosemead, Calif., Edison International is a premier international electric power generator, distributor and structured finance provider. With assets of $36 billion and a portfolio of approximately 28,000 MW, Edison International is an industry leader in privatized, deregulated and incentive-regulated markets and power generation. It is the parent company of Southern California Edison, Edison Mission Energy, Edison Capital and Edison Enterprises.
