Partnering with Our Customers to Build California's Energy Future

1. Partnering with Our Customers to Build California's Energy Future Southern California Energy Summit October 5, 2012 Lisa CagnolattiVice President, Business Customer Division Southern California Edison

2. Agenda • SCE’s Public Safety Initiative • Demand Side Management • Edison SmartConnect™ • Renewable Energy Roadmap • San Onofre Nuclear Generating Station (SONGS) • 2012 Summer Readiness- Exceptional Customer Engagement

3. SCE’s Public Safety Initiative Public Safety Video “No Risks”

4. Demand Side management

5. One of the Country’s Largest Investor-Owned Utilities 50,000 square miles 14 million residents About Southern California Edison • A National Leader in Demand Side Management • 1st or 2nd in the nation for electric energy savings in each of the last 12 years • 11 National US EPA ENERGY STAR® Awards • More than 8.6 billion kWh saved since 2007 • Enough to power over 1.2 million homes for an entire year • Resultant greenhouse gas emission reduction = 3.9 million metric tons • Equivalent of taking 750,000 cars off the road • Largest DR portfolio in California • Edison SmartConnect™ installing 5 million smart meters 5

6. California Energy Policy: A Framework For Energy Efficiency • California’s Energy Action Plan = Energy resource “loading order” • California’s Climate Change Policy (AB32) = GHG reductions to: • 2000 levels by 2010 (11% below “business as usual”) • 1990 levels by 2020 (25% below “business as usual”) • Energy Efficiency = Major source of emissions reductions in Scoping Plan • California Long-Term Energy Efficiency Strategic Plan • Statewide roadmap to maximize achievement of cost-effective energy efficiency 6

7. California Energy Efficiency • EE must be cost-effective in California: Societal Benefits > Costs to Implement • CPUC establishes energy savings goals for Investor Owned Utilities (IOUs) • EE integrated into IOU long-term resource planning process • California Utility Business Model for Energy Efficiency: • Decoupling Mechanism – Decouples recovery of revenue requirements from sales • Program cost recovery included in rates • Earnings – Opportunity to earn incentives for success of EE programs • Since 2002, CA IOU EE programs have delivered over $7 billion in net resource benefits to customers 7

8. SCE Energy Efficiency Portfolio SCE partners with all customers to save energy, money and help the environment • Commercial EE • Small Business Direct Installation • Agricultural EE • Industrial EE • New Construction • Plug Load/Consumer Electronics • Comprehensive HVAC Core • Residential Lighting • Energy Upgrade California • Home Efficiency Rebates • Appliance Recycling Third Party Targeted • Lodging EE • Industrial Gases • Comprehensive Petroleum Refining • Cool Schools • Efficient Affordable Housing • Food & Kindred Products • Primary & Fabricated Metals • 20+ others • Institutional & Government Partnerships • UC/CSU • CA Community Colleges • CA Department of Corrections & Rehabilitation • Energy Leader Partnership Program • Palm Desert • City of Beaumont • South Bay, and more Partnership Low Income • Energy Savings Assistance • California Alternate Rates for Energy • Family Electric Rate Assistance • Technology Development Support • Business Incubation Support • Technology Test Centers • Codes & Standards • Technology Assessments • Scaled Field Placements • Demonstration Showcases • Market and Behavioral Studies Emerging Technology • Workforce Education, Training & Outreach • Green Campus • K-12 Education Education / Outreach • Marketing & Outreach • Mobile Energy Unit 8

9. Energy Leader Partnerships Platinum Partner receives stepped levels of incremental support Gold Cumulative kWh savings Silver Valued • Partnership between SCE and local governments to help cities and counties with a sustainability vision • Helps address demand-side management opportunities in their facilities and communities • Tiered incentive structure that offers increasing incentives based on performance to fund new city/county EE projects • Results: • 112 cities and counties participating from 2010 - 2012 • 1 city has reached Platinum; 9 cities have reached Gold • 56,000,000 kWh saved in municipal facilities since 2010 9

10. Energy Leader PartnershipsHere in the Coachella Valley • SCE works closely with local government customers in this region under the Energy Leader Partnership Program to develop deeper energy savings and demand response participation • Ultimately, it is hoped that each city will be viewed as leading by example in the broad area of sustainability and energy conservation for the community to follow • From Beaumont in the west, to Blythe in the east, and the many Coachella Valley communities in between, energy efficiency projects are aggressively developed and completed to continually reduce each government’s cost of doing business • Here are just a few of the types of projects under way or already completed: • HVAC, Lighting, Server Virtualization, Pumping and Fluid Movement, Waste Water Treatment Plant Efficiency Upgrades, Energy Efficient Street, Walkway, and Parking Lot Lighting • The Partnerships in the Coachella Valley have even promoted the retrofit of home pool pumping equipment and small business direct installation efforts

11. Edison Smartconnect™ 11

12. Edison SmartConnect™ Program Objectives • Create lasting customer value through cost-effective advanced metering technology solutions • Create a design to support federal and state energy policy objectives • Support SCE’s strategy for modernizing the electric infrastructure with smart technologies leading to an intelligent grid • Provide a catalyst for industry innovation toward next-generation technology based on added functionality and open, flexible solutions 12

13. Edison SmartConnect™ SCE’s Smart Metering Program Overview • Approximately 5 Million Existing Electric Meters Will be Replaced With “Smart” Meters by the end of 2012 • Business case approved by CPUC in 2008 • 2012 Program Status • 4.7+ Million Smart Meters Installed • Daily Install Average: 8,000+ • Installers: 300 (average) • Approximately 266,000 Customers Enrolled in Budget Assistant • Nearly486,000 Customers Enrolled in Save Power DayIncentive Alerts • Generating Interval Data Bills for 4Million Customers 13

14. Edison SmartConnect™ Customer Experience Zip code look up SCE.com Assessments Local Government Briefing SCE.com Press Releases YouTube Channel Corix Call Center Phone Surveys Email Surveys Community Forums Bill Onserts Employee Information Pre-installation letter Community Forums Focus Groups How to read your meter Corix Call Center Direct Mail Enrolls in New Rate Meter install Email & Web Solicitations New Devices Mail: Upcoming Programs Door hanger Customer Enrolls Targeted program enrollments Get Connected Random Meter install survey Social Media Carl & Eddy Movie Trailers Save Power Days Targeted program enrollments Email & Web Solicitations Telemarketing Budget Assistant Direct Mail Buckslips Direct Mail Community Forums Customer Enrolls My Account Targeted Campaign Telemarketing Shared Mail SCE.com Online Ads Get Connected Smart Energy Experience 14 Social Media

15. Edison SmartConnect™ Benefits • Rates & Programs • Time of Use Rates • Summer Advantage Incentive (CPP) • Save Power Day Incentive (PTR) • Budget Assistant • Enabling technology • Energy Information Drives Conservation Behaviors • More timely energy usage information • Forecasted cost and demand • Usage history • Reduce peak load by 1,000 MWs • Reduce residential energy consumption by 1% (minimum) • Reduce GHG by 365,000 tons/yr • Automation Self-Service • Remote service switch • Improve customer experience 15

16. Renewable Energy Roadmap

17. Current State • SCE leads the nation in renewable energy, delivering approximately 15.5 billion kilowatt-hours of renewable energy to customers in 2011 • That’s enough to power over 15 million homes each month! • This constitutes about 21.1% of the energy we deliver to customers • In 2011, SCE signed 15 contracts for 920 megawatts of renewable power 17

18. SCE Renewable Portfolio Renewable Resources (billion kWh) Actual 2011 Renewable Resources: 21.1% of SCE’s portfolio 83% Increase Small Hydro 6% Solar 6% Biomass 6% Geothermal 47% Wind 35% 2020 33% RPS Goal 2011 Actual Deliveries California’s Renewable Policy (SBx1-2) Requires a 33% standard by 2020 18

19. 19

20. Renewable Energy Challenges • Intermittent Power • Some renewable energy sources like wind and solar are intermittent and must be backed up by additional conventional power sources to maintain system reliability • Ramping up and down those backup power sources can also present a challenge in terms of planning • Cost of Infrastructure • The California Public Utilities Commission (CPUC) found that achieving the Renewables Procurement Standard (RPS) of 33% by 2020 will require new generating facilities, transmission lines, and other grid infrastructure at an estimated cost of $115 billion • Building New Transmission Lines • California needs new transmission lines to bring renewable power from remote areas to population centers • Building a new electricity transmission line is a huge undertaking • New transmission lines get approved via lengthy, multi-agency permitting procedures, often taking up to 10 years 20

21. Customer Opinions • While customers overwhelmingly support renewables in principle, they are less enthusiastic about paying for them • Customers don’t understand the “true cost” of integrating more renewable power into the grid, both in terms of dollars and impact to reliability • Any increases in costs are shouldered by a small subset of customers 47% 37% 28% 21% 26% 12% 12% 7% 6% 4% Strongly Oppose Strongly Oppose Strongly Support Somewhat Support Somewhat Oppose Don’t Know/ N/A Strongly Support Somewhat Support Somewhat Oppose Don’t Know/ N/A In Principle With Modest Price Increase Sources: FM3 and Winner & Associates – May 2011

22. San Onofre Nuclear Generating Station (Songs)

23. The Role of Nuclear Energyin California • San Onofre provides “baseload” generation • Can produce large amounts of electricity 24 hours a day, 7 days a week, regardless of weather conditions and without constraints • Nuclear energy provides voltage support • Keeps the electrons moving through the grid across the region • Nuclear energy is by far our largest single source of emission-free generation • Provides 24% of SCE’s carbon-free electricity generation mix • Nuclear energy facilities in California supply 37% of the state’s emission-free power generation

24. San Onofre Units 2 & 3 • Started construction in 1974 • Combined units 2 & 3 generate 2,200 megawatts • Unit 2 was taken out of service Jan. 9, 2012 for a planned outage • Unit 3 was safely taken offline Jan. 31, 2012 after station operators detected a small leak in a steam generator tube

25. Testing and Evaluation • Extensive inspections and testing showed tube wear in the steam generators in both units • Unexpected tube-to-tube wear was found predominantly in Unit 3 • Extensive inspections of Unit 2, based on the wear found in Unit 3, identified only one pair of tubes displaying what could be early indications of tube-to-tube wear • The manufacturer’s computer modeling used during the design phase did not accurately predict the vibration-causing environment in the steam generators

26. Restarting SONGS SCE will not restart the plant until the utility and the Nuclear Regulatory Commission are satisfied that it is safe to do so

27. Next Steps at San Onofore • SCE will outline the actions it must take before any restart in a report to the Nuclear Regulatory Commission • The Nuclear Regulatory Commission will hold public meetings to keep the community informed • The Nuclear Regulatory Commission will thoroughly review all documents and must approve all repair and operating plans

28. 2012 summer Readiness – exceptional customer engagement

29. Summer Readiness • SCE & CAISO routinely plan for an outage of one SONGS unit • Long term loss of both units presents significant challenges • Summer readiness mitigation measures activated: • Transmission lines were upgraded • The gas powered plants in Huntington Beach were temporarily restarted • Significant customer outreach 29

30. Tremendous Support from Our Customers • Unprecedented customer response • Conservation efforts by residents and businesses • Customers helped avoid major power outages during our August heat wave • 10 for 10 Program • Approximately 20% of OC businesses reduced their load 10% or more as compared to last summer • Individual customer efforts • Two industrial customers changed their operation during the August heat wave and together shifted over 90 megawatts of load to a time when the system was less stressed 30

31. SCE Social Media Channels Facebook.com/SCE • @SCE • @SCE_Business • @SCE_SONGS LinkedIn: Business Energy Solutions Group YouTube.com/sce sce.com/businessvideos 31