January 5, 2001
ROSEMEAD, Calif., Friday, Jan. 5, 2001-Southern California Edison officials said Friday the company will make extraordinary efforts to provide basic levels of electric and support services to its 11 million consumers despite its critical financial position and the additional cost-reduction and cash-conservation actions announced earlier today.
"The actions are prudent and necessary steps as we seek to ensure that our limited cash reserves are focused as much as possible on keeping electricity flowing for our customers and protecting public health and safety under extremely difficult and challenging circumstances," said SCE Chairman, President & CEO Stephen E. Frank.
Because SCE can no longer obtain financing through commercial markets to pay the extremely high cost of wholesale electric power for its customers-as it has for the past eight months during the state's energy crisis-the company must stringently and urgently conserve cash and balance its resources to both operate the company and keep the lights on within its vast 50,000-square-mile service area. This strain on company resources has led to difficult, but necessary, business decisions that will impact some service levels as SCE focuses on keeping the lights on and protecting public safety, he said.
"In every step of our cost-reduction process," Frank noted, "we have made great efforts to achieve a prudent, measured and responsible approach in order to provide the best level of customer service with the funds available to us. We will concentrate our resources in the areas most important to maintaining basic service levels and maintaining public and employee safety. Even with the extraordinary efforts of our committed and skilled work force, this will be an extremely challenging task to accomplish with available resources."
The announced reductions, totaling nearly $465 million, will affect virtually every operation of the company, including a $100-million reduction in spending in 2001 for electric system operations, maintenance and new investments, which was announced last month. One outcome from this is that electric system components will be replaced only after they fail or are judged likely to fail soon.
The utility's austerity measures will reduce the represented and nonrepresented work force over the next several months by 1,450 full-time, part-time, temporary, contract, and supplemental and contingency jobs. Including the 400 job eliminations announced last month, the total job reductions related to the current fiscal crisis rises to 1,850.
These operational and personnel reductions will modify the way SCE's customer services have been traditionally provided. For example, residential and small-business customer meters will now be read bimonthly instead of monthly, though monthly billing will continue. Bills will be estimated on alternating months.
Major customers will see a reduction in personal interface by company representatives. Online billing and other payment options will be reduced, though convenient neighborhood payment outlets will continue to be available.
Response time for power outages could be longer, depending on available staffing resources, except in known life-threatening situations. And new service connections, which today have essentially no waiting period, will necessarily be performed during normal work hours only, possibly resulting in some delays for developers and customers.
The measures announced today are in addition to those announced in November and December, which also affected Edison International shareholders, whose fourth-quarter common stock dividend payments were canceled. These measures are still in effect, including a hiring freeze, the suspension of charitable and community contributions, as well as the suspension of general new construction, deferrable equipment purchases and service contracts.
# # #
An Edison International company, Southern California Edison is one of the nation's largest electric utilities, serving a population of more than 11 million via 4.3 million customer accounts in a 50,000-square-mile service area within central, coastal and Southern California.
