ML13329A107

Annual Financial Rept,1982

ML13329A107
Person / Time
Site:	San Onofre
Issue date:	02/17/1983
From:	Allen H, Gould W Southern California Edison Co
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NUDOCS 8304060324
Download: ML13329A107 (44)

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Southern 1982 California Annual Edison Report NOTICE Company THE ATTACHED FILES ARE OFFICIAL RECORDS OF THE DIVISION OF DOCUMENT CONTROL.

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DEADLINE RETURN DATE RECORDS FACILITY BRANCH RESULATRYD00KET RILE COPYo 406DO 4 03 0

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Southern California Edison Company Southern California Edison Company provides electric ser-Edison's gross investment in utility plant totals nearly vice in a 50,000 square-mile area of Central and Southern

$10.8 billion. Area generating capacity at peak during 1982 California. This area includes some 800 cities and commu-totaled 15,349 megawatts (MW), which included 13,269 MW nities with a population of more than nine million people.

of Company-owned facilities and 2,080 MW of capacity from other sources. Of the Company-owned facilities, Southern California Edison Company System 78% was comprised of oil-and gas-fired generating units.

toPacific Northwest SCE's interest in coal-fired generating units accounted for another 12%, and 7% was in renewable /alternate gener ation (including hydro). The Company's 80% interest in a Sn Francisco N

UTAH nuclear accounted remaining CALIFORNIA The Company, incorporated in 1909 under the laws of Big

• California, is a public utility and its retail operations are subject to regulation by the California Public Utilities Commission which has the authority, among other things, to establish retail rates and to regulate security issuances, Hooveaccounting and depreciation. The Company's resale operations are subject to regulation by the Federal Energy Regulatory Commission as to rates on sales for resale, A

as well as to other matters including accounting and Los Angele, o

~O~ A**idepreciation.

Sprinmg Pa lo Verd nThe Company's planning and siting of new plant Geo~~r,,I'~construction are subject to the jurisdiction of the California Geothermal

j.

Energy Commission. Edison also is subject to various

-=-governmental licensing requirements, to Securities and

• Service territory Exchange Commission filing and disclosure requirements, Extra-high-voltage (EHV) transmission lines and to certain other federal, state and local laws and

• Hydroelectric generating station regulations, including those related to nuclear energy and A Fosil uel eneatin staionnuclear plant construction, environmental protection, A Fossil fuel generating station E

o gross investment infuel supplies and land use.

$10.

bilio.lAeargnertinecaaciynatpeatduing198 fAbout the Cover: Within its 50,000 square-mile Contents service area (see map above), Edison generates 2:

Letter to Shareholders electricity from eight primary resources..

t natural gas (1), wind (2), geothermal (3), coal (4), nuclearacco 5

6 7

8 (5), oil (6), solar (7), and water (8). In 1980, Edison 14:

Financial Review was the first electric utility in the nation to make 18:

Responsibility for Financial Statements and a large-scale commitment to the accelerated devel-Report of Independent Public Accountants opment of alternative and renewable resources. Today, over 50% of the 19:

Financial Statements Company's 1992 alternative and renewable goal of 2,150 megawatts is on-line, under construction, or represented by signed contracts or letters 35:

Management's Discussion and Analysis of ofintent.

Financial Condition and Results of Operations 37:

Capital Stock-Dividend and Price Information 38:

Selected Financial Data 1972-1982 oprtos r

ujett eulto y

h eerlEeg Reguatoy Comision s t rats o

sals fr reale

1982 Annual Report Five-Year Compound Highlights 1982 1981 Change Growth Earnings Per Share

$5.13

$4.93 4.1%

6.2%

Common Dividends Paid Per Share (a)

$3.31

$3.03 9.2 11.5 Rate of Return on Common Equity 14.89%

14.87%

0.1 4.4 Operating Revenues (000)

$4,302,602

$4,054,356 6.1 15.8 Fuel and Purchased Power Costs (000)

$2,227,901

$2,558,206 (12.9) 13.4 Operating Expenses Net of Fuel Costs and Taxes on Income (000) (b)

$ 993,158

$ 897,403 10.7 9.7 Kilowatt-Hour Sales (000) 59,326,853 62,451,319 (5.0) 0.5 Customers Served 3,275,144 3,232,687 1.3 2.5 Area Peak Demand (Megawatts) 13,149 13,738 (4.3) 2.6 Area Generating Capacity at Peak (Megawatts) 15,349 15,592 (1.6) 1.5 (a) On September 16, 1982, the Company's Board of Directors authorized an increase in the common stock quarterly dividend to $0.88 from

$0.81 per share, effective with the October 31, 1982 payment, which is equivalent to $3.52 per share on an annual basis.

(b) Fuel costs include fuel, purchased power and the provision for energy cost adjustments.

$6 20%

Earnings per Share and 0 Earnings Rate of Return on U Earned Rate of Return Dividends Paid per Share U Dividends Common Equity U Authorized Rate of Return Earnings for calendar 1982 5

The Company earned a reached $5.13 per share, 14.89% rate of return on 16 the highest recorded in common equity in 1982 the Company's history.

which was essentially the This amount surpassed 4

level authorized by the the previous high of CPUC. This achievement 12

$4.93 in 1981. An 8.6%

during a year between increase in the common 3

general rate cases is stock quarterly dividend largely attributable to the was declared in Septem-favorable impact of the s

ber raising the rate from attrition allowance rate

$3.24 to $3.52 per share increase at the beginning on an annual basis. This of 1982 as well as continu action represented the ing cost control programs.

4 seventh increase since I

March 1977, an average annual increase of 13%.

0 78 79 80 81 82 0

78 79 80 81 82 83 REQULATORY DOCKET FILE COPY

To Our More Than 190,000 Shareholders:

Your Company achieved record earnings for the In 1982, significant progress in our resource strat second consecutive year in 1982 and further strength-egy strengthened your Company's ability to reduce ened its financial health and operating integrity its dependence on costly fuel oil and natural gas:

through an ongoing commitment to alternative El Nuclear: Following issuance of a low-power and renewable resources, nuclear and coal energy, operating license by the Nuclear Regulatory Coi economy power purchases, strict cost controls, and mission (NRC) in February 1982, San Onofre Nuclear conservation and load management programs.

Unit 2 was fueled and began low-power testing. The El Earnings increased to $5.13 per share from $4.93 Unit was synchronized to the electric system and be a year ago and we essentially achieved our autho-gan power ascension testing after NRC issuance of a rized return on common equity for the third time in full-power operating license in September 1982. By four years.

year-end, Unit 2 reached 50% of its generating ca El The dividend on our common stock was raised pacity and is expected to be tested at full-power out from $3.24 per share to $3.52 per share on an annual put in the second quarter of 1983. The NRC granted basis, increasing for the seventh time in six years at a Unit 3 at San Onofre a low-power operating license rate averaging 13% annually.

in November 1982. A full-power license for Unit 3 is El The market price of our common stock reached expected in the first quarter of 1983 at which time book value for the first time since 1973.

power ascension testing will begin with full-power El The California Public Utilities Commission (CPUC) testing scheduled in late 1983. When both 1,100 authorized a $590 million annual rate increase, effec-megawatt (MW) units become fully operational and tive January 1, 1983, and the opportunity to earn a 16%

join Unit 1, which has been out of service since Feb return on common equity, up from 14.95% authorized ruary 1982 for inspection, maintenance and seismic in 1981. A concurrent decrease in the fuel-related upgrading, the San Onofre facility will displace the portion of the Company's rates resulted in a net in-energy equivalent of about 25 million barrels of ex crease of $303 million, or 7.7%.

pensive oil and natural gas annually.

Our improved earnings reflected higher non-cash El Alternative and Renewable Resources: About one-half allowances for funds used during construction and of our planned capacity additions of 2,150 MW from the continued impact of stringent cost control and alternative and renewable energy resources between productivity improvement programs. They also now and 1992 are on-line, under construction, or rep reflected a January 1, 1982, interim rate increase of resented by signed contracts or letters of intent. Be

$92 million which was designed to help offset the cause the economic feasibility of alternative and inflationary impact of certain non-fuel-related costs renewable resources is measured against avoided experienced between biennial general rate reviews.

fuel costs which have been declining, some of these The Company's record earnings were achieved additions may be delayed or may not fully material despite the dilutive effect of new shares of common ize. However, we are encouraged by the success stock and a 5% decrease in kilowatt-hour sales result-of this program to date. The start-up in 1982 of Solar ing from mild summer temperatures, reduced eco-One, the nation's first central receiver solar/thermal nomic activity and conservation efforts. An Electric generating plant, brought the number of primary re Revenue Adjustment Mechanism was established in sources we use to generate electricity to eight-oil, the 1983 general rate case to stabilize the future level gas, wind, geothermal, coal, nuclear, solar and of revenue authorized by the CPUC regardless of water-more than any other electric utility in the fluctuations in kilowatt-hour sales. This procedure, world. By the year 1992, we expect the energy equiv along with an attrition allowance for 1984, should alent of approximately 15 million barrels of costly oil again afford the Company an opportunity to earn in and natural gas to be displaced by alternative and the range of its authorized rate of return over the renewable additions.

next two-year rate cycle.

2

El Power Purchases: More than 22 billion kilowatt-a regional power outage that was potentially greater hours (KWH), or 34% of the Company's electric sales in total magnitude than the historic northeast black in 1982, were represented by record amounts of out of 1965.

lower-cost hydro and coal power purchased from All our constituencies can share with pride in our neighboring utilities. These purchases reduced Edi-financial and operating improvements as well as our son's oil and natural gas requirements by the energy many honors, including the prestigious John and equivalent of more than 35 million barrels, saving Alice Tyler Ecology-Energy Prize for our bold pro customers about $750 million.

grams in alternative and renewable resources. Our El Conservation and Load Management: With our cus-achievements in 1982 are largely the result of the tomers' support, Edison's conservation programs dedication, cost-consciousness and exceptional hard saved more than $200 million in fuel costs in 1982 by work of our officers, managers and employees, the reducing electrical usage by 4.4 billion KWH-the understanding and cooperation of our customers, the energy equivalent of approximately seven million timely and responsible decisions of regulators, and barrels of fuel oil and natural gas. Additionally, the support of you, our shareholders.

load management programs designed to reduce To each of our several constituencies and par load growth from 2.6% to 2% annually could cut our ticularly our shareholders, we pledge our continuing capital outlays by 1992 by as much as a billion dollars.

innovative and determined effort to merit your In a further effort to help hold down customers' support.

electric bills, we have implemented more than 1,300 productivity improvement suggestions from em-7, ployees which, over the years, will save millions of dollars in operating costs and capital expenditures.

Thanks to innovative and effective work by em ployees at all levels in 1982, Edison maintained a 50%

more favorable customer-per-employee ratio than the average of the nation's 20 largest electric utilities.

Further, in late November/early December 1982, the most devastating wind and rainstorms in our Company's history marshalled the services of our work forces around the clock. Our employees re stored electric service to approximately 1.4 million customers, about 40% of our 3.3 million customers, over a period of several days during and after the storms.

Later in December, the Edison system was se verely tested again when hurricane-force winds east of San Francisco downed eight high-voltage towers Howard P. Allen William R. Gould in the Pacific Intertie System which inter-connects President Chairman of the Board utilities throughout the West. When that storm-and Chief Executive Officer caused outage hit, an electrical load of 8,431 MW on February 17, 1983 Edison's system was automatically reduced by 3,246 MW, the single largest load-shedding in our history.

While this load-shedding affected about one-third of our customers for varying periods of time extending to a maximum of two hours, it successfully avoided 3

Year in Review Edison attained significant paper manufacturing, milk processing, oil refining, financial and operating landfill gas recovery, cement and chemical production, goals in 1982, strengthen-and classroom heating and cooling.

ing further its ability to Additionally, a parallel generation agreement executed provide a competitive invest-during the year with Shell California Production, Inc.,

ment return to shareholders proposes a coal-fired cogeneration project for initial oper and reliable electric service to ation in 1988 that will produce steam to recover heavy oil customers at a reasonable price.

and concurrently generate up to 750 MW of electricity.

The Company also continued to de-Further, a letter of agreement was signed with Getty Oil crease its dependence on costly fuel Company in 1982 for a gas-fired cogeneration project for oil and natural gas, and moved operation by 1987 that will also produce steam for oil re measurably closer to meeting its covery and up to 300 MW of electricity.

alternative and renewable re-Edison's current plans call for 1,000 MW of cogeneration source goals, underscoring a by 1992 with 250 MW to serve customer load at plant sites corporate commitment best de-and 750 MW to serve SCE system needs.

scribed by SCE's Chairman and Chief Executive Officer William R.

Hydro: Pending regulatory approvals, construction is Gould, in his acceptance of the Tyler scheduled to begin in August 1983 on the 200-MW Balsam Ecology-Energy Prize at the 10th anniversary United Meadow hydro project in the High Sierra northeast of Nations Environmental Programme.

Fresno. The project is 100% Edison-owned and designed "Even in these more difficult years, I think I have and will utilize down-stream water from Huntington to grown more optimistic about our future... The incentive Shaver Lakes to generate electricity. Operation is sched that drove our company toward the use of alternate and uled for January 1988. The Company also continued to renewable resources was grounded in optimism, hope examine the feasibility of purchasing the output of the and confidence in mastering new technologies to serve 120-MW Dinkey Creek Project, which the King's River the world."

Conservation District has licensed for construction on the western slope of the Sierra Nevada.

Alternative and Renewable Resources Until recently, it had been presumed that all cost-effec Alternative and renewable resource technologies continued tive hydro sites had already been developed. As other to be developed at a rapid pace in 1982. Future develop-fuel costs have climbed, however, more and more small ment of these resource additions, however, could be hydro projects have become feasible. In 1982, two such delayed or not fully materialize since their economic projects were placed in commercial operation. A 20 feasibility is measured against the avoided cost of fossil kilowatt (KW) generating unit was installed in the fish fuel which has been declining. By year-end, approxi-water release system at Shaver Lake Dam, and a 40-KW mately 1,200 megawatts (MW) of our 2,150-MW alternative unit utilizes the water system that feeds the City of Ava and renewable energy goal for development by 1992 were Ion on Catalina Island. By year-end, 14 small hydro proj on line, under construction, or represented by signed ects totaling 90 MW were under purchase commitment.

contracts or letters of intent.

Wind: In 1982, wind parks developed by third-party entre Cogeneration: Cogeneration, the utilization of a single fuel preneurs using arrays of more than 300 small wind turbine to produce both process steam and electricity at large in-generators contributed more than a million kilowatt-hours dustrial, commercial and residential sites, continues to be (KWH) to the Edison system. In aggregate over the years, a major contributor to the Company's alternative resource these small units are expected to provide a significant plan. At present, 25 cogeneration projects with an aggre-capacity addition to SCE's system.

gate capacity of 165 MW are on-line and operating within the Edison system. Engineering and construction are in progress on another 17 cogeneration projects totaling 347 MW. Projects are now operational in such diverse areas as 4

"More than ever before, corporate decisions must be measured against this test: What is the impact upon the customer?"

William R. Gould, March 17, 1982 Edison's customer service representatives undergo intensified training in the Company's Customer Information System (CIS) to respond more efficiently to consumer needs and concerns.

CIS is part of an Edison computer network that can process instruc tions for more than 200 separate corporate sys tems at speeds up to 45 million instructions per second.

5

At year-end, 13 wind contracts totaling 144 MW had been executed and negotiations were in process for another 400 MW. Of the 13 executed contracts, seven sys tems are operating in the Tehachapi Mountains and six systems are scheduled for siting in Riverside County pending the receipt of permits.

Developmental testing of larger wind turbine genera tors continued during the year at Edison's Wind Energy Center near Palm Springs. A three-bladed, horizontal axis Bendix/Schachle unit was modified and is now experimentally operating on the Edison system with a maximum output of 1.3 MW. In addition, an experi mental Wenco horizontal axis turbine with an output of 100 KW is planned for testing in 1983.

In other Wind Energy Center programs, a 50-KW verti cal axis DAF/Indal system operated more than 2,500 hours0.00579 days <br />0.139 hours <br />8.267196e-4 weeks <br />1.9025e-4 months <br />, producing approximately 50,000 KWH of electricity.

Site development engineering also began for a 500-KW DAF/Indal vertical axis system which is scheduled for completion in 1983.

Solar: More than 250 MW of electricity from solar thermal and solar photovoltaic systems are planned by the end of the decade. The 10-MW Solar One generating station, located on about 100 acres of land at Edison's Cool Water Generating facility near Daggett, California, began power production in April 1982 and was officially dedicated in November. Edison is the operator of the plant, which is the world's largest central receiver electric generating facility and represents a joint venture between Edison, the U.S. Department of Energy, the Los Angeles Depart ment of Water and Power, and the California Energy Commission.

In operation, Solar One uses more than 1,800 computer controlled tracking mirrors to reflect and concentrate sun light on a 300-foot-high central receiver/boiler to produce steam. A thermal storage system allows 7 MW of limited operation without sun.

Nuclear Unit 2 at San Onofre began power ascension tests in 1982 and Unit 3 is expected to begin power ascension tests in 1983. When both nuclear units come on-line and join Unit 1 at San Onofre, which has been out of service since February 1982 for inspection, maintenance and seismic upgrading, the San Onofre facility will displace the energy equivalent of about 25 million barrels of oil and gas annually.

6

The fuel cost to operate Nuclear Unit 2 at San Onofre is approximately 20% of the cost of oil and natural gas.

76

Significant progress was achieved during the year with gasification studies by Edison and other participants third-party contractors in developing additional solar moved into the project stage in 1982 when a funding plan facilities:

was formally executed and 25% of construction completed

• Solar 100: In 1982, Edison solicited and received propos-on the nation's first integrated coal gasification combined als for third-party ownership of a 100-MW solar thermal cycle generating facility. When completed in mid-1984 at electric power plant modeled after Solar One, but with Edison's Cool Water Generating Station, the combined 10 times its capacity. Current plans call for development cycle plant will generate 100 MW of electricity by burning of the project near the end of the decade.

a medium BTU gas produced from the gasification of coal.

• Solar Salt Pond: Edison began the second phase of site Preliminary tests have demonstrated that gasified domes selection for a solar salt pond generating plant under a tic coal, burned in a plant as a replacement for oil, meets contract that will provide the Company with 20 MW of stringent environmental standards.

electric power following financing, construction and oper ation of the facility by a third-party entrepreneur.

Biomass: The Company is participating in the Ventura

• Solar Trough: Edison and Luz International Ltd. reached Regional County Waste-to-Energy and Resource Recovery agreement to build and operate a solar trough facility of Project scheduled to begin operation at 20 MW adjacent to up to 49 MW at Edison's Cool Water site.

the Company's Ormond Beach Generating Station in 1986.

• Solar Photovoltaic: In April 1982, contracts were signed with ARCO Solar, Inc., for the construction of a one-Nuclear Power megawatt solar photovoltaic plant on a 20-acre site adja-On September 20, 1982, Unit 2 at the San Onofre Nuclear cent to the Company's Lugo Substation near Victorville.

Generating Station was synchronized to the electric sys All systems are now complete and plant operation has tem and began power ascension tests in which the power started. The plant was officially dedicated on February 15, level is raised in stages as prescribed by the Nuclear Reg 1983, and consists of 108 flat-plate solar photovoltaic arrays ulatory Commission's September 1982 full-power license.

which convert the sun's energy directly into electricity.

The unit is expected to be tested at full-power output in the second quarter of 1983.

Geothermal: The Company was encouraged in 1982 by the Nuclear Unit 3 at San Onofre received a low-power continued operation of its first 10-MW geothermal plant at operating license in November 1982 and a full-power Brawley, which has been in service for two years even license is expected in the first quarter of 1983. Power as though contamination problems associated with the use cension tests will begin shortly thereafter with full-power of hot subterranean water and steam are still being expe-testing scheduled in late 1983.

rienced. A second 10-MW geothermal plant at the Salton San Onofre Unit 1 has been out of service since February Sea was dedicated in January 1983 and is currently operat-1982 for inspection, maintenance and seismic upgrading ing at more than 90% of capacity.

and is expected to return to service in 1983. Since begin The Company cancelled work on the 47-MW Heber ning operation in 1968, Unit 1 has produced approximately dual-flash geothermal plant in late 1982, having deter-35 billion KWH of electricity, saving customers millions of mined that its development is no longer feasible when dollars in fuel costs over the years by displacing the en measured against the avoided cost of fossil fuel which has ergy equivalent of 58 million barrels of oil.

been declining. Power purchase arrangements with third Edison's ownership interest in Unit 1 is 80%. Its own parties are still being considered for this and other poten-ership in Units 2 and 3 was reduced to 75.05% in 1982 tial geothermal projects.

following regulatory approval of an additional 1.5%

ownership interest by the City of Anaheim. Anaheim's Research and Development total ownership in Units 2 and 3 is 3.16%. The City of Edison's research and development expenditures in 1982 Riverside owns 1.79% and San Diego Gas & Electric totaled $50 million. Investments to commercialize alterna-Company owns 20%. Edison's total megawatt ownership tive energy sources represent the single largest compo-in the three units is 2,000 MW.

nent of the Company's R&D program.

Coal Gasification: Representative of the Company's R&D efforts in alternative energy resources, ongoing coal 8

Productivity improvements suggested by our employees will save millions of dollars over the years.

Edison employee at right in this photo at Mohave Generating Station suggested additional valving on soot blower system to allow repair work without system shut down, saving more than $200,000 annually.

Other employee sug gestions resulting from Edison's Productivity Improvement Program (PIP) have produced ideas and operating changes that will save millions of dollars in capital expenditures and operating costs over the years.

A9

~~an'

Edison also has a 15.8% interest totaling 579 MW in three 1,222-MW units being constructed at the Palo Verde Nuclear Generating Station near Phoenix, Arizona. Con struction is 84% complete and operation of the three units is expected in the 1984-1986 period.

A 240-mile, 500-kilovolt (KV) line between Palo Verde, Arizona, and Edison's Devers Substation near Palm Springs was completed in March 1982. In addition to car rying Palo Verde power into the Edison system, the line also forms a major Company-owned interstate transmis sion path for firm generation capacity and economic power purchases from other utilities in the Southwest.

Generation Resources for the 1980s After factoring in an expected 1,500 MW decrease in sys tem demand through load management, Edison projects a need for 6,325 MW of new generating capacity during the next 10 years to meet the electricity requirements of its ex isting and new customers. This generation need is equal to nearly half of current Company-owned facilities and takes into account the planned retirement of older oil-and gas-fired units. The new capacity additions are planned to be met by 2,340 MW of nuclear power, 2,150 MW of alter native and renewable resources, and 1,835 MW of pur chases. As a result of this flexible strategy, the Company deferred the 1,500-MW Ivanpah Coal Project.

Negotiations continued during the year with Mexico's Comision Federal de Electricidad for purchases of 260 MW j,

of geothermal power to supplement 70 MW already under purchase contract. The 70 MW are expected to be delivered by early 1985 from Mexico's Cerro Prieto geothermal site.

In addition, Edison and other original California under writers of the Hoover Dam power project are pursuing renewal of 50-year Hoover power contracts which expire in 1987. Some California municipalities, which were not original underwriters, are seeking Hoover power allot ments for the first time, while Arizona and Nevada are pursuing increased allotments. Edison intends to protect its allotment rights as an underwriter in line with federal government criteria.

Edison's Energy Control Center integrates all electric power into the Company's system, including power purchases from throughout the Western U.S. and Canada. Power purchases in 1982 exceeded 22 billion kilowatt-hours or 34% of the Company's total sales.

10

Record power purchases in 1982 helped reduce our annual oil and

-gas consumption by the energy equivalent of more than 35 million barrels, saving customers more than $750 million.

A"A

Fuel and Purchased Power Total electric consumption by Edison's 2.9 million resi In 1982, 34% of the Company's KWH sales, more than 22 dential customers in 1982 decreased 1.7% to 16.4 billion billion KWH, was met by low-cost power purchases from KWH from 16.7 billion KWH in 1981, despite the addition neighboring electric utilities. As a result, Edison offset its of 35,165 new residential customers to the Company's ser need for more costly natural gas and oil by the energy vice territory during the year.

equivalent of more than 35 million barrels in 1982, saving Average residential consumption decreased 3.3% in customers more than $750 million in fuel costs.

1982 to 5,685 KWH from 5,879 KWH the previous year.

Edison's efforts to increase its level of economy power The decrease was the result of cooler summer tempera purchases were aided during the year by power informa-tures, higher electricity costs and continuing customer re tion exchange programs initiated with the California sponse to conservation programs.

Power Pool and the Western Systems Coordinating Coun cil. The Company is further emphasizing transmission Conservation and Load Management improvements in its pursuit of lower-priced purchased 1982 marked Edison's 10th year of formal conservation power. The construction of the Devers/Palo Verde 500-KV and load management planning and program implemen line, for example, saved $32 million through lower-cost tation. The combination of customer response to Edison power purchases in 1982.

conservation programs plus the Company's direct conser Fuel and purchased power costs continued to be the vation efforts on its system in 1982 resulted in a fuel cost single largest component of the total cost of providing savings of more than $200 million through fuel use reduc electric service to customers in 1982, representing 52 cents tions of 4.4 billion KWH, the energy equivalent of more out of each revenue dollar. Fuel and purchased power than seven million barrels of costly oil and natural gas.

costs totaled $2.2 billion, down 12.9% from 1981 fuel and Of this total, Edison's efforts in voltage regulation, dis purchased power costs of $2.5 billion. While annual oil tribution circuit management and street light conversion consumption of 4.5 million barrels in 1982 was the lowest contributed a savings of 1.7 billion KWH while customer annual amount since 1954, the consumption of natural gas response to Company conservation programs, including increased to 257 billion cubic feet, the equivalent of 43 customer cogeneration, contributed a savings of 2.7 million barrels, representing almost 37% of the Com-billion KWH.

pany's total fuel mix.

Edison conservation programs offered to customers in 1982 included:

Annual Peak Demand

- Residential Conservation Service.., a program in which Peak demand for electricity on the Edison system de-Edison provided more than 30,000 free home-energy sur clined in 1982 primarily because of mild summer weather, veys in 1982, recommending conservation practices cus conservation and reduced economic activity. The Com-tomers can follow to reduce electric bills by using energy pany recorded a 1982 area peak demand of 13,149 MW on more efficiently.

September 2, 1982, a 4.3% decrease from the record

- Zero-interest loans... a program to help residential cus 13,738 MW set on August 27, 1981. The annual compound tomers in SCE's Eastern Desert service territory pay for growth in peak demand over the last five years has conservation improvements which, by year-end, encom been 2.6%.

passed 2,100 participants with an average loan of $2,000 per participant. Edison will offer a systemwide low Electric Consumption interest (8%) financing program in 1983.

Electric consumption by Edison's 3.3 million customers in Commercial, industrial and agricultural energy audits 1982, including 42,457 new customers, was 59.3 billion

... a free energy audit program which produced an annual KWH, compared to 62.4 billion KWH the previous year.

savings in 1982 of 1.3 billion KWH, the energy equivalent This 5% reduction was primarily due to cooler summer of $70 million in fuel oil costs.

temperatures and a significant decline in electric usage by Edison's load management programs are designed to the industrial sector, reflecting conservation efforts and shift the use of electricity from periods of peak usage to reduced economic activity. The number of new customers periods of reduced demand in order to defer construction added to Edison's system last year was the lowest of new generating facilities. The Company currently plans since 1945.

to reduce annual peak load growth from 2.6% to 2% by 12

1992 primarily through innovative rate-option load man-During the five-year period from year-end 1977 through agement programs presently in place or under evaluation.

year-end 1982, minority representation increased from These include:

18.9% to 26.3% and female representation from 17.1%

• Time of use rates... a program which utilizes special to 21.9%.

metering to encourage participating commercial and in-Edison's Procurement Division provided increased op dustrial customers to shift electric usage away from peak portunities to Minority Business Enterprises (MBEs) in demand hours.

1982. Since the Company's Minority and Small Business

• Interruptible rates... a program in which participating Development Program was formally introduced in 1979, commercial and industrial customers agree to reduce elec-the number of MBEs qualified to provide goods and ser trical usage when requested by Edison.

vices to Edison has increased by 79%, and the number of

• Pool pump timing... a program which encourages resi-opportunities to compete for contracts annually has in dential customers to reduce electric demand during peak creased by 410%.

periods by changing clock timing hours on swimming pool and spa pumps.

Consumer Affairs

• Air conditioning cycling... a program in which par-Edison established a corporate Consumer Affairs Commit ticipating residential and commercial customers agree to tee in 1982 to provide oversight and development of allow Edison to cycle air conditioning compressors re-policies, programs and communications directed at or motely during periods of capacity shortages.

affecting the consumer. The committee is responsible for

• Demand Subscription Service... a program which uses assessing the current and future consumer environment, remote controllers to allow Edison to limit electric usage and recommending and directing appropriate corporate of participating residential customers during critical consumer affairs actions designed to help meet custom periods.

ers' needs in a prompt and forthright manner.

Edison's continuing efforts to live up to a 75-year tradi Management Change tion of good service, square dealing and courteous treat Robert H. Bridenbecker, formerly manager of Fuel Sup-ment were underscored last November and December ply, was elected vice president of Fuel Supply on May 1.

when employees expended more than 300,000 work He succeeds William H. Seaman, who retired after 41 hours4.74537e-4 days <br />0.0114 hours <br />6.779101e-5 weeks <br />1.56005e-5 months <br /> in the restoration of electric service to customers years of dedicated service.

during the most severe and widespread wind and rain storms in the Company's history. Over a one-week period Affirmative Action beginning November 30, 1982, emergency crews worked Representation of minorities and females in the Com-in shifts around the clock to repair more than 1,200 power pany's work force increased in 1982 through affirmative poles and towers. Other personnel handled about 226,000 action efforts. Minority representation increased from customer calls, staffed warehouses and garages, and at 25.4% to 26.3% at year-end. Female representation in-tended to the special needs of the physically handicapped creased from 20.6% to 21.9% during the same period, and the elderly.

Percentage of Male, Female and Minority Asian American Total Employees at Male Female Black American Indian Hispanic Minorities Year-dEnd410%

YerEdYear-End Year-End Year-End Year-End Year-End Year-End Year-End 1977 and 1982 1977 1982 1977 1982 1977 1982 1977 1982 1977 1982 1977 1982 1977 1982 Management(')

92.2 84.9 7.8 15.1 2.0 3.5 2.8 5.7 0.7 0.5 5.0 6.8 10.5 16.5 Non-Management 2 )

78.9 74.6 21.1 25.4 7.0 9.1 2.0 3.2 0.8 1.1 12.9 17.8 22.7 31.3 Total Company 3 )

82.9 78.1 17.1 21.9 5.5 7.2 2.2 4.1 0.7 0.9 10.5 14.1 18.9 26.3 (1) Management employees include the "Officials and Managers" and "Professionals" Affirmative Action Categories.

(2) Non-Management employees include the "Technicians," "Office and Clerical," "Craftsmen," "Operators,"

"Laborers" and "Service Workers" Affirmative Action Categories.

(3) Includes all classes of employees.

13

Financial Review The following discussion provides a review of the factors Kilowatt-hour sales for the year were down primarily which had a significant impact on the Company's finan-because of a mild summer, contrasted with the unusually cial condition in 1982. Several of these events also may hot weather of 1981. This, combined with the effects of impact the Company in 1983 and beyond. Additionally, reduced economic activity and continued conservation ef reference should be made to the accompanying financial forts, resulted in a 3.9% decrease in sales to Edison cus statements and their related notes beginning on page 19.

tomers. Total kilowatt-hour sales, which include sales to other utilities, decreased by 5%. The reduced sales to Earnings Reach Record High other utilities resulted from above-average amounts of hy Earnings per share of common stock rose to a record droelectric power and reduced growth rates on their own calendar-year high of $5.13 from a previous high of $4.93 systems.

recorded in 1981. This increase was accompanied by a 14.89% earned rate of return on common equity, marking Dividend Increased the third time in four years that Edison has earned a rate In September, the Board of Directors approved an 8.6%

of return on common equity at essentially the level au-increase in the common stock dividend. The 7o per share thorized by the California Public Utilities Commission increase in the quarterly rate brought the annual dividend (CPUC). This performance was largely attributable to to $3.52 per share as compared with the previous rate of continued stringent cost controls and productivity

$3.24 per share. The Board's action represented the measures, a $92 million rate increase attrition allowance, seventh dividend increase in the past six years. Over that and higher non-cash allowances for funds used during period, the dividend increase has averaged 13% annually.

construction.

At year-end, the dividend was providing a 10% yield on Adverse factors which affected 1982 earnings included a the common stock market value of $35/ per share.

reduction in kilowatt-hour sales, the dilutive effect of newly issued common stock and a series of winter storms Rate Increases and Adjustments which severely damaged equipment and resulted in rec-Attrition Allowance: In the 1981 rate case, the Commission ord overtime costs.

authorized the Company a $92 million rate increase Attn Operating revenues for 1982 increased by $248 million, tion Allowance which became effective on January 1, 1982.

or 6%, to a total of $4.3 billion. This increase in revenues This represented the first time that the CPUC granted the principally reflects rate adjustments to cover higher costs Company rate relief to offset many of the inflationary in of fuel during the first half of the year and the $92 million creases in non-fuel operation and maintenance costs gen attrition allowance effective January 1, 1982.

erally experienced in the year between general rate cases.

S3 (inbillions)

Sources and Distribution Sources Fuel and Purchased of Revenues in29%

Residential Power Costs The Company's 1982 28% Comurial Fuel and purchased oterut26%e, eresenbd5.strrduidsaast sources of revenues re-9% Public power costs for 1982 were flect a near equal balance Authorities

$2.23 billion, or t2.9%

from each of the major 6% Resale less than recorded 1981 customer classes-resi-2% Agricultural costs. Principal reasons 2

dential, commercial, and for the decrease in 1982 industrial, More than were a substantial in half of these revenues crease in the availability were expended for fuel pDistribution of hydroelectric and pur

-52%

Fuel & Purchased and purchase power.

Power chased power, an in 2p% Operation crease in the availability 12% Dividends of natural gas and a re

& InterestI duction in kilowatt 5% Depreciation hour sales, all of which 5% Maintenance displaced the use of 4% Reinvested Earnings more costly fuel oil.

sr2% Taxes & Other fe 7

79 8n ub 8

cReducedfor dividends acd interest capitalized (AFLIDu 14

Energy Cost Adjustment Clause (ECAC) and Annual Energy indirect fuel costs in the AER. The remaining 90% of these Rate (AER): The tri-annual ECAC procedure is designed to costs, as recorded, is designed to be recovered through adjust rates to reflect changes in fuel costs. The Company the tn-annual ECAC. This means that 90% of the Coi estimates total fuel costs projected to generate electricity pany's total recorded direct and indirect fuel costs should during the subsequent four-month time period taking into be recovered through ECAC, but that 10% of any differ consideration availability and changing cost of fuels and ence between estimated and recorded annual fuel costs is purchased power, and status of balancing accounts. The at risk under the new AER procedure.

Commission reviews the Company's total fuel cost projec-The CPUC decision limited this AER-related risk to a tions and adjusts electric rates upward or downward.

maximum positive or negative amount which, in 1983, ap Under this procedure, 98% of recorded fuel and pur-proximates $32 million. The CPUC believes that such chased power costs above or below those used in estab-treatment provides an incentive for more efficient fuel lishing rates are accumulated in a balancing account and management.

are reflected in subsequent ECAC rate adjustments.

During 1982, ECAC-related rate adjustments authorized General Rate Case Decision: In December 1982, the Commis by the Commission were: an increase of $546 million, on sion granted a general rate increase of $590 million annu an annual basis, effective January 5, 1982 and a decrease ally, effective January 1, 1983. This decision incorporated of $719 million, on an annual basis, effective May 4, 1982.

these increases: $567 million in general rates, $14 million In September 1982, fuel-related rates were also reviewed in the Conservation and Load Management Adjustment by the Commission and remained unchanged.

Clause rate and $9 million in the Annual Energy Rate.

The ECAC procedure also provides for an Annual The Commission increased the Company's authorized Energy Rate (AER), which is a fixed rate established once rate of return on common equity from 14.95% to 16%. In a year and designed to recover a portion of estimated granting this decision, the Commission recognized sub annual direct and indirect fuel costs. Direct fuel costs stantial inflationary increases in operating and capital include fuel and purchased power. Indirect fuel costs in-costs, the effects of the federal Economic Recovery Tax clude carrying charges on fuel oil inventory and other fuel Act of 1981, and additional expenses for customer conser related expenses. For 1982, indirect fuel cost estimates and vation and load management programs.

2% of direct fuel costs estimates were included in the AER.

The impact of this increase on the customer was par The CPUC made changes in this procedure scheduled tially offset by a reduction of $287 million annually in to go into effect in May 1983. The most significant change ECAC rates which reflected an increase in purchased is to incorporate 10% of the estimates of both direct and power and hydroelectric resources because of above aver Generation Fuel Mix 1982 Recorded Funds Required for in o

4% Oil Construction SCE's continued commit-de37%

Gas ment to alternative and 14% Coal Construction expendi renewable resources and 1% Nuclear tures are projected to the scheduled addition 0

enewables decrease after 1983 pri-900 of nuclear power are mx-(including hydro) mantly as a result of the tranto account for 3% Purchased Power-completion of San 23% and 19% of the 1992 ne ent 31% Purchased Power-Oor ula nt generation fuel mix Other and 3, reduced demand respectively, up substan-growth and the avail-600 tially from 6% and 1%

ally, effeciveJO ability of alternate!

recorded in 1982. This o19%

Gas renewable resources emphasis on diversified 11% Coal and purchased power.

fuel sources should 18% Nuclear For the five-year period enable the Company to m7m%

Renewables 1983-i987, funds required 300 limit capital expenditures (including hydro) for construction cur and reduce dependence 16% Purchased Power-rently are forecasted at Renewables on high-cost oil and gas.

ECAC ratcCa

$4.2 billion.

Other 0

82 83 84 85 86 87 15

age precipitation in 1982. Therefore, the net effect of these New CPUC Commissioners: In December, Governor Brown two Commission actions on the Company's customers was appointed, and the State Senate confirmed, Donald Vial, a rate increase of $303 million, or 7.7%. Because of the de-former state director of industrial relations, to a six-year crease in ECAC rates last May, electric rates for residential term on the CPUC replacing Commissioner Richard customers in January 1983 were lower than electric rates Gravelle. Governor George Deukmejian is expected to ap in January 1982 despite the recent overall rate increase.

point a Commissioner to fill the vacancy created by the resignation of John Bryson, who served as president of the Electric Revenue Adjustment Mechanism (ERAM): In the 1983 Commission since 1979. Commissioner Leonard Grimes general rate case decision, an Electric Revenue Adjust-was elected by the Commissioners as president of the ment Mechanism (ERAM) was established to stabilize the Commission for 1983.

level of revenue authorized by the Commission regardless of fluctuations in the level of kilowatt-hour sales. This Record Level of Financings Completed procedure, along with an attrition allowance for 1984, To finance the construction program during 1982, a should again afford the Company an opportunity to earn record amount of capital, $1.08 billion, was raised, sur in the range of its authorized rate of return on common passing the record set in 1981. The Company sold nine equity during the next two-year rate cycle. The ERAM security issues in addition to the ongoing sale of common will protect customers by ensuring that a utility retains no stock through the Dividend Reinvestment and Stock more than the authorized revenues while encouraging the Purchase Plan, the Employee Stock Purchase Plan and the Company to promote conservation programs.

Employee Stock Ownership Plan.

Details of these issues are shown in the following table:

Other regulatory matters Major Additions Adjustment Clause (MAAC): In February Month Issue Term Copo AMont 1982, the Company filed to include in rate base the cost of owning and operating. San Onofre Unit 2. At that time it Jout Conro was expected that in August 1982 the unit would meet the F

nerS "used and useful" test for cost recovery. It also was ex-February Common Stock pected that fuel savings, over time, would approximately 5,000,000 shares @ $285/8 139 offset the base rate increases with the long-range prospect April First and Refunding Mortgage of bill stabilization, assuming fossil fuels resumed their pat-Bonds 30 years 16%

125 tern of cost increases. In June, the CPUC decided it April Cumulative Preferred Stock 20 years 12.31%

50 would be necessary for the unit to complete its full war ranty run (200 hours0.00231 days <br />0.0556 hours <br />3.306878e-4 weeks <br />7.61e-5 months <br /> at 100% capacity) before the unit would be eligible for rate base treatment. The Company August Convertible Euro-Debentures 15 years 50 petitioned for a rehearing of this unprecedented criterion, October Euro-Debentures 8 years 11 %

75 seeking a more reasonable and historical test of "used and November Pollution Control Bonds useful" such as 100 hours0.00116 days <br />0.0278 hours <br />1.653439e-4 weeks <br />3.805e-5 months <br /> at 80% capacity. In December, Four Corners 30 years 103%

80 the CPUC denied Edison's request. It is now projected November First and Refunding Mortgage that San Onofre Unit 2 will not meet this unusually strin-Bonds 30 years 12%

200 gent criterion prior to mid-year 1983.

Ongoing Dividend Reinvestment and The Commission also established a two-phase proce-Stock Purchase Plan 75 dure for including San Onofre in rate base. The first Employee Stock Purchase Plan 25 phase, which currently is in progress, consists of hearings Employee Stock Ownership to determine the procedures for cost recovery and the amount initially to be included in rates. The second phase

$1,080 will include hearings on the reasonableness of costs in-Responding to the continuing volatility of capital curred in the construction of San Onofre. Although markets, additional emphasis was placed on expanding phase-two hearings have not been set, they are expected sources of capital, employing innovative financing tech to take place in late 1983 or early 1984 after a CPUC con-niques and maximizing financing flexibility.

sultant's report is completed.

16

Twice in 1982, the Company utilized tax-exempt lieved that although there was a risk of higher interest financing for pollution control equipment as a vehicle to rates involved with a deferral, economic indicators sup achieve lower borrowing costs. In January, $177 million of ported a downturn in interest rates. Thus, it was con three-year tax-exempt bonds were issued to finance costs cluded that the risk of delaying the bond offering was of constructing pollution control facilities at the coal-fired justified. On November 4, $200 million of bonds were Four Corners Generating Station. In November, a brief successfully sold at a 12% interest rate. The nine-day defer but significant improvement in the tax-exempt market ral resulted in a 1/% lower interest rate, representing prompted the Company to issue 30-year tax exempt a $2.5 million annual savings to customers from reduced bonds for the purpose of refunding at maturity a portion interest costs.

of the three-year issue, resulting in millions of dollars of The $1.08 billion in new capital raised in 1982 brought future savings to Edison's customers.

the total capitalization of the Company to $8.28 billion.

The Company again was active in the European market SCE's capital structure at year-end 1982 was 48% Debt, in 1982, placing $75 million of Euro-Debentures in April 11% Preferred and Preference Stock, and 41% Common and $75 million in October. Increased demand abroad for Equity.

the Company's common stock also enabled the Company to offer $50 million of Convertible Debentures in the Improvement in Stock Price European market. Because of the underlying equity The Company's common stock price continued its im value, investors were willing to accept a substantially provement in 1982. In August, the stock reached book lower yield than on conventional debt. The Company was value for the first time since early 1973. This favorable the first utility in the United States to issue convertible development reflects the strength of the Company's im debt in the European market. During 1981-1982, the Com-

-proved financial performance, an aggressive dividend pany placed a total of $375 million of debt securities in policy, Edison's commitment to developing alternative Europe, all at rates below levels existing in the domestic and renewable energy resources and the result of hard market.

work from cost-conscious employees. Based on the pur In November, the last major financing of 1982, $200 mil-chase price of $283/ per share at the beginning of 1982 and lion of 30-year mortgage bonds, was completed. Competi-the year-end price of $351/8 per share, the Company's tive bidding for the bonds originally was scheduled for common stock provided a total return in 1982 of 33.7%, or October 26. However, the offering was postponed when

$9.69 per share. This includes a price appreciation of interest rates climbed dramatically. The Company be-

$6.38 and dividends paid of $3.31.

$50 25%

Stock Price Comparison U Book Value Dividend Reinvestment Percent of Total Shareholders In August 1982, the Corn-j Common Stock Market Price and Stock Purchase Plan 4

Percent of Total Shares pany's common stock aParticipation in the Divi reached book value for 40 dend Reinvestment and 20 the first time since early Stock Purchase Plan 1973, reflecting the (DRP) increased signifi strength of Edison's in cantly in 1982, largely financial performance, 30 asa result of the benefits 15 an aggressive dividend provided to participants policy, the Company's from the Economic continued commitment Recovery Tax Act of 1981.

to developing alternative 20 1982, over 10 and renewable energy res e

37,000aparticipating share resources, and the hard holders held approxi work of cost-conscious mately 18.5 million shares employees.

10 of SCE common stock.

a 0

7273 7475 7677 78 795012 0

78 79 80 81 82 17

Southern California Edison Company Responsibility for Financial Statements The management of Southern California Edison Company with, the independent accountants develop and maintain has prepared and is responsible for the financial state-an understanding of the Company's accounting and ments and the other related financial data contained in financial controls, and conduct such tests and related this Annual Report. The financial statements, which procedures as they deem necessary to render their include amounts based on estimates and judgments of opinion as to the fairness of the financial statements.

management, have been prepared in conformity with The Audit Committee of the Board of Directors, generally accepted accounting principles applied on a composed entirely of directors who are not officers or em consistent basis.

ployees of the Company, meets periodically with the To meet its responsibilities with respect to financial in-management of the Company, the independent public ac formation, the Company maintains a system of internal countants and the internal auditors to make inquiries as to accounting controls which is designed to provide reason-the manner in which the responsibilities of each are being able assurance that assets are safeguarded from loss or discharged. In addition, the Audit Committee recoi unauthorized use and that the financial records properly mends to the Board of Directors the annual appointment reflect the authorized transactions of the Company. This of the independent public accountants with whom the system is supported by written policies and procedures, Audit Committee reviews the scope of the audit and the organization structures that provide for appropriate divi-nature of other services provided as well as the related sion of responsibility, the selection and training of quali-fees, the accounting principles being applied by the Coi fied personnel and is augmented by programs of internal pany in financial reporting, the scope of internal financial audits. There are limits inherent in all systems of internal auditing procedures, and the adequacy of internal ac accounting control based on the recognition that the counting controls.

cost of such system should not exceed the benefits to be To further assure independence in performing and derived. The Company believes its system of internal reporting the results of audits, representatives of the inde accounting control appropriately balances this cost-pendent public accountants and the Company's staff of benefit relationship.

internal auditors have full and free access to meet with An independent examination of these financial state-the Audit Committee, without members of Company ments has been conducted by Arthur Andersen & Co.,

management being present, to discuss any accounting, independent public accountants, in accordance with gen-auditing, or financial reporting matter.

erally accepted auditing standards. In connection there Report of Independent Public Accountants To the Shareholders and the Board of Directors, Southern California Edison Company:

We have examined the balance sheets and statements of In our opinion, the financial statements referred to capital stock and long-term debt of Southern California above present fairly the financial position of the Company Edison Company (a California corporation, hereinafter as of December 31, 1982 and 1981, and the results of its referred to as the "Company"), as of December 31, 1982 operations and the sources of its funds used for construc and 1981, and the related statements of income, earnings tion expenditures for each of the three years in the period reinvested in the business, additional paid-in capital and ended December 31, 1982, and further, in our opinion, the sources of funds used for construction expenditures for quarterly financial data set forth in Note 8 of "Notes to each of the three years in the period ended December 31, Financial Statements" summarize fairly the results of 1982. Our examinations were made in accordance with operations for each quarter within such years, all in con generally accepted auditing standards and, accordingly, formity with generally accepted accounting principles included such tests of the accounting records and such applied on a consistent basis.

other auditing procedures as we considered necessary in the circumstances, and also included similar examinations peror of the financial statements for each quarter within each of the years.

Los Angeles, California ARTHUR ANDERSEN & CO.

February 4, 1983 18

Southern California Edison Company Statements of Income Thousands of Dollars Year Ended December 31, 1982 1981 1980 Operating Revenues:

Sales (Notes 1 and 2).......................

.$4,266,950

$4,026,548

$3,631,373 O ther....................................

35,652 27,808 29,744 Total operating revenues (Note 8)............

4,302,602 4,054,356 3,661,117 Operating Expenses:

Fuel (Note 2)..............................

1,778,553 2,078,393 1,729,552 Purchased power (Note 10)..................

449,348 479,813 280,675 Provision for energy cost adjustments (Notes 1 and 5)................

367,565 (90,273) 361,600 Other operation expenses (Notes 6, 7 and 10)..

496,585 441,939 392,593 Maintenance (Note 1).......................

210,160 193,397 228,269 Provision for depreciation (Note 1)...........

220,927 202,182 187,959 Taxes on income-current and deferred (Notes I and 5)...................

177,251 197,865 38,683 Property and other taxes (Note 5)............

65,486 59,885 69,652 Total operating expenses (Notes 3 and 9)......

3,765,875 3,563,201 3,288,983 Operating Income (Note 8)............................................

536,727 491,155 372,134 Other Income and Income Deductions:

Allowance for equity funds used during construction (Note 1)......................

209,485 162,879 121,488 Interest income............................

34,571 39,025 33,889 Taxes on non-operating income credit (Notes 1 and 5)......................

100,655 54,261 30,358 Other-net...............................

965 13,896 1,524 Total other income and income deductions..

345,676 270,061 187,259 Total Income Before Interest Charges...................................

882,403 761,216 559,393 Interest Charges:

Interest on long-term debt..................

360,915 281,626 227,163 Other interest and amortization (Note 1).....

59,367 59,351 55,493 Total interest charges.......................

420,282 340,977 282,656 Allowance for debt funds used during construction (Note 1)......................

(93,633)

(69,673)

(40,799)

Net interest charges........................

326,649 271,304 241,857 Net Income (Note 8)..................................................

555,754 489,912 317,536 Dividends. on Cumulative Preferred and Preference Stock................

72,396 67,888 60,950 Earnings Available for Common and Original Preferred Stock............

$ 483,358

$ 422,024

$ 256,586 Weighted Average Shares of Common and Original Preferred Stock Outstanding and Common Stock Equivalents (000).....................

94,257 85,610 73,241 Earnings Per Share (Notes l.and 8)......................................

$5.13

$4.93

$3.50 Dividends Declared Per Common Share................................

$3.38

$3.10

$2.84 The accompanying notes are an integral part of these financial statements.

19

Southern California Edison Company Balance Sheets Thousands of Dollars December 31, Assets 1982 1981 Utility Plant:

Utility plant, at original cost (Notes 1, 2 and 9)....

$ 6,609,540

$6,115,484 Less-Accumulated provision for depreciation (Notes I and 9)...................

2,185,667 2,015,212 4,423,873 4,100,272 Construction work in progress (Notes 6 and 9)....

4,108,878 3,377,644 Nuclear fuel, at amortized cost..................

45,660 24,542 8,578,411 7,502,458 Less-Accumulated deferred income taxes (Notes 1 and 5)..........................

79,084 25,972 8,499,327 7,476,486 Other Property and Investments:

Real estate and other, at cost-less accumulated provision for depreciation........

11,383 9,194 Subsidiary companies (Note 1)...................

104,378 124,558 115,761 133,752 Current Assets:

Cash and equivalents (Note 4)...................

120,661 10,409 Cash investments-financing subsidiary (Note 1)....................................

127,849 Receivables, less reserves of $8,105,000 and

$10,682,000 for uncollectible accounts at respective dates (Note 1)......................

306,041 306,267 Fuel stock, at cost (first-in, first-out) (Note 4).....

605,162 579,633 Materials and supplies, at average cost..........

64,185 63,197 Regulatory balancing accounts-net (Notes 1 and 5) 39,441 Accumulated deferred income taxes-net (Notes 1 and 5)...............................

198,939 4,872 Prepayments and other (taxes, insurance, etc.)...

42,563 38,943 1,465,400 1,042,762 Deferred Charges:

Unamortized debt expense (Note 1)..............

29,169 22,368 Accumulated deferred income taxes-net (Notes 1 and 5)...............................

21,892 Other deferred charges.........................

26,015 27,203 77,076 49,571

$10,157,564

$8,702,571 The accompanying notes are an integral part of these financial statements.

20

Southern California Edison Company Thousands of Dollars December 31, Capitalization and Liabilities 1982 1981 Capitalization:

Preferred Stock-subject to mandatory redemption/repurchase requirements:

Cumulative Preferred Stock..................

383,000

$ 337,500 Preference Stock.............................

62,000 62,000 Preferred Stock-other:

Original Preferred Stock......................

4,000 4,000 Cumulative Preferred Stock...................

458,755 458,755 Preference Stock.............................

8,265 13,553 Common Stock, including additional stated capital................................

856,152 776,523 Other Shareholders' Equity:

Additional paid-in capital....................

1,142,932 953,268 Earnings reinvested in the business............

1,393,780 1,238,317 Long-term debt (Note 1)........................

3,970,400 3,444,080 8,279,284 7,287,996 Current Liabilities:

Accounts payable.............................

411,240 360,018 Commercial paper payable (Note 4)..............

266,500 Notes payable to banks (Note 4)................

23,992 28,687 Short-term borrowings-financing subsidiary (Notes 1 and 4)....................

123,300 Long-term debt due withii one year........-.-.-.-.

53,500 121,025 Preferred Stock to be redeemed within one year......................

4,500 Taxes accrued (Note 5).........................

166,139 61,774 Interest accrued..............................

112,666 85,089 Customer deposits............................

16,732 12,518 Dividends declared...........................

90,636 75,036 Regulatory balancing accounts-net (Notes I and 5)..............................

362 187 Other.......................................

38,094 76,269 1,402,986 1,086,916 Commitments and Contingencies (Notes 2, 3 and 10)

Reserves and Deferred Credits:

Customer advances and other deferred credits...

146,877 66,697 Accumulated deferred investment tax credits (Notes I and 5)........................

274,280 200,598 Accumulated deferred income taxes-net (Notes 1 and 5)...............................

21,141 Reserves for pensions, insurance, etc. (Note 7)...

54,137 39,223 475,294 327,659

$10,157,564

$8,702,571 The accompanying notes are an integral part of these financial statements.

21

Southern California Edison Company Statements of Sources of Funds Used for Thousands of Dollars Construction Expenditures Year Ended December 31, 1982 1981 1980 Funds Provided By Operations:

Net income (Note 8)..........................

$555,754

$489,912

$317,536 Non-cash items in net income Depreciation (Note 1)......................

220,927 202,182 187,959 Allowance for debt and equity funds used during construction (Note 1).............

(303,118)

(232,552)

(162,287)

Investment tax credits deferred-net (Notes 1 and 5)..........................

64,612 47,386 25,235 Other-net..............................

99,609 3,701 29,271 Total funds from operations...................

637,784 510,629 397,714 Dividends..................................

(395,103)

(336,546)

(273,312)

Total funds from operations-reinvested.......

242,681 174,083 124,402 Long-term Financing:

Sales of securities Long-term debt............................

576,864 634,435 350,000 Preferred stock............................

49,474 75,000 Common stock (a).........................

264,634 292,356 258,607 Reduction for long-term debt due within one year........................

(53,500)

(121,025)

(143,548)

Reduction for preferred stock to be redeemed within one year..................

(4,500)

Conversion of preference stock................

(5,290)

(6,344)

(7,169)

Total funds from long-term financing..........

827,682 799,422 532,890 Other Sources (Uses) of Funds-Working capital changes Cash and equivalents......................

(238,101)

(2,767)

(2,937)

Receivables-net..........................

226 (17,288)

(76,251)

Fuel stock and materials and supplies (Note 4).

(26,517)

(880)

(284,654)

Regulatory balancing accounts-net (Notes 1 and 5)...........................

196,059 (37,568) 235,512 Accounts payable........................

51,222 3,678 67,443 Net short-term borrowings.................

(147,895) 110,214 30,793 Long-term debt and preferred stock due within one year.........................

(63,025)

(22,523) 59,004 Other changes in working capital............

121,463 (41,038) 63,274 Net (increase) decrease in working capital..

(106,568)

(8,172) 92,184 Sale of non-current assets....................

50,623 89,557 Other-net.................................

30,108 (59,193)

(57,523)

Total other sources (uses) of funds...............

(76,460)

(16,742) 124,218 Funds Used for Construction Expenditures...............................

$993,903

$956,763

$781,510 (a) Includes conversions of Preference Stock, 5.20% Convertible Series, to Common Stock.

The accompanying notes are an integral part of these financial statements.

22

Southern California Edison Company Statements of Earnings Reinvested Thousands of Dollars

• in the Business Year Ended December 31, 1982 1981 1980 Balance at January 1...................................................

$1,238,317

$1,092,137

$1,054,296 Add:

Net income...............................

555,754 489,912 317,536 1,794,071 1,582,049 1,371,832 Deduct:

Dividends declared on capital stock Original Preferred........................

1,589 1,454 1,334 Cumulative Preferred.....................

67,291 62,504 55,230 Preference..............................5,105 5,384 5,720 Common-$3.38 per share for 1982,

$3.10 per share for 1981, and

$2.84 per share for 1980.321,118 267,204 211,028 Capital stock expense.......................

5,188 7,186 6,383 400,291 343,732 279,695 Balance at December 31(a)...........................................$1,393,780

$1,238,317

$1,092,137 (a) Includes undistributed earnings of unconsolidated subsidiaries of $4,867,000 and appropriated earnings related to certain federally-licensed hydro electric projects of $4,177,000 at December 31, 1982.

Statements of Additional Paid-in Capital Thousands of Dollars Year Ended December 31, 1982 1981 1980 Balance at January 1..................................................

$ 953,268

$763,519

$601,578 Premium received on sale of common stock 189,668 189,754 161,949 Payments made in lieu of issuing fractional shares of common stock.....

(4)

(5)

(8)

Balance at December 31..............................................

$1,142,932

$953,268

$763,519 The accompanying notes are an integral part of these financial statements.

23

Southern California Edison Company Statem n Eo Cpal December 31, 1982 Thousands of Dollars Statements of Capital Stock Rdmto ttdVle Redemption Stated Value Shares Price December 31, Outstanding Per Share 1982 1981 Preferred Stock-Subject to Mandatory Redemption/

Repurchase Requirements (a) (b) (f):

$100 Cumulative Preferred-par value $100 per share:

7.325% Series........................

750,000

$110.00

$ 75,000

$ 75,000 7.80% Series........................

600,000 110.00 60,000 60,000 8.54% Series........................

750,000 108.54 75,000 75,000 8.70% Series A......................

525,000 110.00 52,500 52,500 12.00% Series........................

750,000 112.00 75,000 75,000 12.31% Series.......................

500,000 105.83 50,000 387,500 337,500 Less: Preferred stock to be redeemed within one year 4,500

$383,000

$337,500 Preference-par value $25 per share:

7.375% Series....................

2,480,000

$ 25.25

$ 62,000

$ 62,000 Preferred Stock-Other:

Original Preferred-5%, prior, cumulative, participating, not redeemable, authorized 480,000 shares, par value $81A per share 480,000

$ 4,000

$ 4,000 Cumulative Preferred-authorized 24,000,000 shares, par value

$25 per share (a):

4.08% Series........................

1,000,000

$ 25.50

$ 25,000

$ 25,000 4.24% Series........................

1,200,000 25.80 30,000 30,000 4.32% Series........................

1,653,429 28.75 41,336 41,336 4.78% Series........................

1,296,769 25.80 32,419 32,419 5.80% Series........................

2,200,000 25.25 55,000 55,000 8.85% Series........................

2,000,000 26.50 50,000 50,000 9.20% Series........................

2,000,000 26.50 50,000 50,000

$100 Cumulative Preferred-authorized 12,000,000 shares, par value

$100 per share (a):

7.58% Series..................

750,000 102.50 75,000 75,000 8.70% Series 500,000 107.00 50,000 50,000 8.96% Series........................

500,000 107.00 50,000 50,000

$458,755

$458,755 Preference-authorized 10,000,000 shares, par value

$25 per share (a) (c):

5.20% Convertible Series.............

330,617

$ 25.00

$ 8,265

$ 13,553

$100 Preference-authorized 2,000,000 shares, par value

$100 per share........................................................

Common Stock-authorized 140,000,000 shares, par value $81/3 per share, including additional stated capital (c) (d) (e) (f).........................

96,691,973

$856,152

$776,523 (a) All series of $100 Cumulative Preferred Stock, annually until all shares are redeemed issued by Southern California Edison Finance Cumulative Preferred Stock and Preference or repurchased.

Company, N.y.

Stock are redeemable at the option of the Com-(2) Based upon 2.5% of shares originally out pany. The 500,000 shares of $100 Cumulative standing and increasing to 5.5% by 2003.

(e) At December 31, 1982, there were 3,654,749 Preferred Stock, 12.31% Series, are not subject (3) Based upon 2.5% of shares originally out-authorized and unissued shares of Common to such redemption until May 1, 1992. The standing and increasing to 9.5% by 2000.

Stock reserved for sale and issuance under pro various series of the $100 Cumulative Preferred (4) Based upon 7% of shares originally out-visions of the Company's stock purchase plans.

Stock, and the Preference Stock, 7.375% Series, standing and increasing to 13.25% by 2002.

On February 1, 1983, the Company issued are subject to certain restrictions on redemption F

ch of the five years subsequent to 682,927 shares of Common Stock under these for refunding purposes. Authorized shares of D

r 3g plans.

Preferred Stock-Subject to Mandatory Re-redempor repurhe requiementwl (f Transactions in the capital stock accounts demption or Repurchase Requirements are rdmto rrprhs eurmnswl indeptindr reraed Requiremetre be: $4,500,000 for 1983, $4,500,000 for 1984, during 1982, 1981 and 1980 reflect the following:

included$18,212,500 for 1985, $22,712,500 for 1986, and Shares of Common Stock were issued (b) Preferred Stock Subject to Mandatory

$22,712,500 for 1987.

through public offerings and for the Dividend Redemption or Repurchase Requirements:

Reinvestment and Stock Purchase Plan (DRP),

Redemption(c)

Under Employee Stock Purchase Plan (ESPP), Em Redenpton r Reurcase price of the Preference Stock, 5.20% Convertible ployee Stock Ownership Plan (ESOP), and the Number Series is adjusted when additional shares of conversion of 211,522, 253,761 and 286,780 Commence-of Shares Price Per Common Stock are sold by the Company. The Series ment Date Annually Share (1) sae ntersetv erfPeeec mentDat Anualy Sare(1)shares of Common Stock reserved for conver-Stock, 5.20% Convertible Series (5.20% Series)

$200 Cunulative sion and the adjusted conversion prices per as follows:

Preferred share were as follows:

7.325%........7/31/83 30,000

$100 December 32, Shares Issued 1982 1981 1980 7.80%........

11/30/83 15,000(2)

$100 1982 1981 Public offerings 5,000,000 8,000,000 7,000,000 8.54%........

6/30/86 22,500

$100 Shares of Common DRP 2,498,253 1,906,474 1,751,330 8.70%A.......

6/30/85 13,125(3)

$100 Stock reserved.......262,393 430,268 ESPP.........820,752 1,053,413 953,885 12.00%........

12/31/86 22,500

$100 Adjusted conversion ESOP.........601,948 591,084 1,033,794 12.31%........

4/30/88 35,000(4)

$100 price per share

$31.50

$31.50 5.20% Series..

167,748 198,483 219,873 Preference 500,000 shares of $100 Cumulative Preferred 7.375%........

2/1/85 496,000

$ 25 (d th Compn S

rerve 1

0 Stock, 12.31% Series were issued in 1982 and (1) Plus accumulated unpaid dividends.

$50,000,000 principal amount of 121/2% Con-750,000 shares of $100 Cumulative Preferred Redemption or repurchase to continue vertible Subordinated Debentures, Due 1997, Stock, 12.00% Series were issued in 1980.

The accompanying notes are an integral part of these financial statements.

Southern California Edison Company Statements of Long-term Debt Thousands of Dollars December 31, 1982 1981 First and Refunding Mortgage Bonds (a)(d)(e):

Due 1982-1986 (4V,% -10% )......................................................

$ 421,800

$ 362,500 D ue 1987-1991 (4'/4% -151 % )....................................................

675,000 675,000 Due 1992-1996 (5% % -8Vs% ).....................................................

555,000 555,000 Due 1997-2001 (7% -8/8% )......................................................

515,030 515,030 Due 2002-2005 (8/% -15Vs% )....................................................

830,000 830,000 Due 2010-2021 (10-%

-16% )....................................................

763,300 358,300 3,760,130 3,295,830 First Mortgage Bonds (Calectric) (a)(d)

Due 1984-1991 (3%4% -5/8%).....................................................

60,000 60,000 Prom issory N otes (b)(d) Due 1982-1983(51/2% )..........................................................

3,500 7,027 Prom issory Notes (c)(d) Due 1986-1994 (12%-16/%).....................................................

375,000 175,000 Pollution Control Indebtedness (d)(e)

D ue 1984 (8/8% )...............................................................

92,500 92,500 Principal am ounts outstanding.........................................................................

4,291,130 3,630,357 Long-term debt due w ithin one year (d).................................................................

(53,500)

(121,025)

Unam ortized debt premium or (discount)- net..........................................................

(22,024)

(16,252)

Securities held by trustees (e)..........................................................................

(245,206)

(49,000)

Total long-term debt...........................................

I..................................

$3,970,400

$3,444,080 (a) The authorized principal amount of each (b) The Company has entered into a financing Thousands of Dollars series of First and Refunding Mortgage Bonds agreement, as amended, with certain English Year Ed is equal to the amount outstanding. The Trust December 31, Maturities Requirements Total Indenture under which these bonds are issued notes payable in pounds sterling. The Company permits the issuance from time to time of addi-has entered into forward exchange contracts tional bonds, including additional bonds equal with a United States bank to purchase pounds 1984..........175,500 175,500 in principal amount to bonds retired, pursuant sterling to repay substantially all of the promis-1985..........272,800 5,250 278,050 to the restrictions and conditions contained sory 1987..........196,000 5,250 1,250 therein. Substantially all of the properties of the (c) Promissory Notes payable to Southern Cali Company are subject to the lien of the Trust fornia Edison Finance Company N:V. (Firnbfice)

- (e)-Promissory-notes and First and Refunding Indenture. The Trust Indenture requires semi-have been issued in exchange for the proceeds Mortgage Bonds have been issued to different annual deposits with the Trustee of 112% of the from the issuance of Debentures by Finance, municipalities and other governmental agencies principal amount of the Company's outstanding Payment of the principal and interest on in exchange for the proceeds from the issuance First and Refunding Mortgage Bonds and the

$325,000,000 and $50,000,000 principal amount of Pollution Control Revenue Bonds. The Coi Calectric First Mortgage Bonds. The Calectric In-of the Debentures are, respectively, uncondi-pany is obligated to pay the principal and inter denture requires an annual cash deposit with tionally guaranteed and guaranteed on a subor-est on these bonds. The proceeds have been the Trustee of 1% of the principal amount of dinated basis by the Company. The deposited with Trustees and are being utilized Calectric First Mortgage Bonds issued or 16626%

subordinated Debentures are convertible into to defray the construction and other specified of such amount if property additions are used to the Company's Common Stock, As of December costs of pollution control facilities. The Coi satisfy the annual deposit requirements. In ad-31 1982, the Company has guaranteed the bank pany issued First and Refunding Mortgage dition, an amount equivalent to the excess of ditonan mout euialet t th exessof borrowings and Commercial Paper of a wholly-Bonds, Series VVP, Due 2012 in the principal 15% of defined operating revenues over costs of owned subsidiary of the Company. These short-amount of $80,000,000 and Series WWP, Due maintenance of the property subject to the lien term borrowings are reflected in the Company's 2003 in the principal amount of $88,000,000 on of such indenture is required to be deposited balance sheet at December 31, 1982.

December 8, 1982 and February 3, 1983, respec with the Trustee annually. These deposit re-tively. The proceeds from these issuances are quirements of such indentures may be or have (d) Maturities and sinking fund requirements held in trust for purposes of refunding First been satisfied by property additions and re-of long-term debt for the five years subsequent and Refunding Mortage Bonds, Series SSP, placements, and by delivery and cancellation of to December 31, 1982, are as follows:

Due 1985.

bonds outstanding under the applicable indenture.

The accompanying notes are an integral part of these financial statements.

25

Southern California Edison Company Notes to Financial Statements Note 1-Summary of Significant Accounting Policies Debt Premium and Discount Debt premium or discount and related expenses are General-amortized to income over the lives of the issues to which The Company is a public utility primarily engaged in the they pertain.

business of supplying electric energy in portions of Cen tral and Southern California, excluding the City of Los Revenues and Regulatory Balancing Accounts Angeles and certain other cities. The accounting records Customers are billed monthly on a cycle basis and reve of the Company are maintained in accordance with the nues are recorded when customers are billed. As autho Uniform System of Accounts as prescribed by the Federal rized by the CPUC, the Company has established several Energy Regulatory Commission (FERC) and adopted by regulatory balancing accounts for its adjustment clauses, the California Public Utilities Commission (CPUC).

which affect the accounting for most of its fuel and pur chased power costs. The Energy Cost Adjustment Clause Utility Plant-(ECAC) balancing account is used by the Company to re The cost of additions and replacements of retirement cord monthly entries to adjust the results of operations for units of property is capitalized and included in utility the variation between ECAC-related fuel and purchased plant. Such cost includes labor, material, indirect charges power costs incurred and those included in rates billed to for engineering, supervision, transportation, etc., and an customers. Such variations, including interest thereon, allowance for debt and equity funds used during con-are accumulated in the balancing account until they are struction (AFUDC). The amount of AFUDC capitalized is refunded to, or recovered from, utility customers through also reported in the Statements of Income as a reduction CPUC-authorized rate adjustments. ECAC-related fuel of interest charges for the debt component of AFUDC and and purchased power costs include incurred transporta as other income for the equity component. Although tion and interim storage costs related to spent nuclear AFUDC increases net income, it does not represent cur-fuel. The income tax effects of ECAC variations are de rent cash earnings. The AFUDC rate for the year 1982 was ferred. Billed revenues and incurred fuel and purchased 9.20%, for the year 1981 was 8.77%, and for the year 1980 power costs are utilized in the determination of taxable was 7.82%, based upon a formula prescribed by the FERC.

income.

The cost of minor additions and repairs is charged to Subsidiaries maintenance expense and the original cost, less net sal-The Company's investments in unconsolidated subsidiary vage, of retired property units is charged to the accumu-companies, all of which are wholly-owned, are accounted lated provision for depreciation.

for by the equity method except for the Company's sub sidiary engaged in Eurodebenture financings. For this Property-related accumulated deferred income taxes subsidiary, cash investments and short-term borrowings reflect the consumption of value in the plant and equip-are presented separately on the balance sheet of the Com ment to which they relate and have been deducted from pany. None of the Company's other wholly-owned sub utility plant. This treatment is consistent with the method sidiaries is considered significant for financial reporting utilized in ratemaking proceedings to determine the rate purposes.

base on which the Company is entitled to earn a return.

Earnings Per Share Depreciation -

Earnings per share are determined by dividing the earn For financial reporting purposes, depreciation of utility ings available for Common and Original Preferred Stock plant is computed on a straight-line remaining life basis by a weighted average number of such shares outstand and approximated 3.6%, 3.6% and 3.5% of average depre-ing. After providing for cumulative preferred and prefer ciable plant for the years 1982, 1981 and 1980, respectively.

ence stock dividend requirements, effect is given to the The Company's rates are designed to recover the original participating provisions of the Original Preferred Stock cost of utility plant, including the estimated decommis-and Common Stock Equivalents for funds held for the pur sioning costs of $58,000,000 (stated in current year dollars) chase of the Company Common Stock by the Employee for nuclear generation facilities in service, through depre-Stock Purchase Plan Trustee in each period. The dilutive ciation expense over the estimated remaining useful lives effect on earnings per share of the conversion of the of the facilities.

5.20% Convertible Series Preference Stock issued by the Company and Convertible Debentures issued by South Taxes -

emn California Edison Finance Company N.y., an affiliate Accounting policies with respect to taxes on income and of the Company, is not significant.

related investment tax credits are set forth in Note 5, together with supplementary tax information.

26

Southern California Edison Company Reclassification On August 2, 1982, the Company filed a cross-complaint Accumulated deferred income taxes related to utility plant against Chevron seeking, among other things, a declara have been reclassified in the Company's prior year bal-tory judgment that the Company properly and effectively ance sheet to make them comparable to the classification terminated the subject contract and the return from Chev in 1982.

ron of approximately $12,000,000 in underlift payments made by the Company to Chevron in the last half of 1981 Note 2-Commitments and Contingencies on a provisional basis.

Construction program and fuel supply-If Chevron is finally successful in pursuing its present The Company has significant purchase commitments in position and if rate recovery of the Company's costs under connection with its continuing construction program. As or resulting from the contract is not allowed, the Coi of December 16, 1982 (the date of the Company's latest pany's financial exposure would be significant. Although approved budget), funds required for construction expen-the Company cannot predict with certainty whether the ditures are estimated at $1,079,000,000 for 1983, $852,000,000 CPUC and the FERC will allow the Company to recover for 1984 and $847,000,000 for 1985. Minimum long-term its costs under or resulting from the contract, the Com commitments of approximately $1.8 billion exclusive of pany expects to include any such costs in existing or spe the Chevron contract discussed below existed on Decem-cial fuel cost recovery proceedings and believes that ber 31, 1982, under the Company's fuel supply and trans-such costs are a proper item for recovery through rates.

portation arrangements.

Government licenses Fuel Supply Litigation-The terms and provisions of licenses granted by the The Company entered into a contract (for the period Jan-United States cover the Company's major and certain uary 1, 1978 through June 30, 1986) with Chevron U.S.A.

minor hydroelectric plants. These licenses also cover cer Inc. (Chevron) to purchase fuel for generation. Due to en-tam storage and regulating reservoirs and related trans vironmental, economic, regulatory and other factors, the mission facilities. All of the above licenses expire at Company reduced, and then suspended (commencing various times between 1983 and 2009. The licenses contain April 1, 1982), its fuel deliveries under the contract. On numerous restrictions and obligations on the part of the May 19, 1982, the Company sent a notice to Chevron Company, including the right of the United States to ac which, among other things, terminated the contract effec-quire Company properties or, under certain conditions, tive June 24, 1982. Chevron disputes the effectiveness of the FERC to issue a license to a new licensee upon the this notice. On July 26, 1982, the Company sent an addi-payment to the Company of specified compensation.

tional notice to Chevron which, while preserving the Company's rights under the May 19 notice, gave notice of Resale revenues termination under two other sections of the contract, Pursuant to FERC procedures, on February 1, 1976, which terminations became effective as of October 25, August 16, 1979, July 16, 1981, and June 2, 1982, increases 1982 and January 31, 1983, respectively.

in the Company's resale rates became effective, subject to refund with interest to the extent that any of the increases On April 30, 1982, Chevron filed an action against the are subsequently determined to be inappropriate. Effec Company in the Superior Court of the State of California tive May 2,1974, a Fuel Clause Adjustment (FCA) was for the City and County of San Francisco for declaratory added to the Company's resale rates and has been modi relief and breach of contract. Chevron alleged that the fied concurrent with the subsequent base rate increases Company had no contractual basis to reduce below certain beginning with the February 1, 1976, increase. As of levels or suspend deliveries of fuel, or terminate the con-December 31, 1982, revenues subject to refund, after giv tract. Chevron did not specify the amount of damages ing effect to incremental FCA billing credits, aggregated alleged to have been incurred. Chevron did seek a ruling approximately $281.8 million.

that the Company would be obligated to pay a "facility charge" (approximately $8,300,000 a month) during the The Company believes that, based on present facts, the remaining contract term. The Company disagrees with amount of refunds, if any, likely to result from the out Chevron's interpretation of the contract and with many of standing proceedings would not have a significant effect Chevron's allegations. The Company believes that it has on net income.

substantial affirmative defenses and intends to vigorously defend the Chevron action.

27

Southern California Edison Company Notes to Financial Statements (continued)

Legal matters-Thousands of Dollars In March 1978, five resale customers filed a suit against Year Ended Capital Operating the Company in federal court alleging violation of certain December31 Leases(a)

Leases 1983.................................

$20,420

$12,403 antitrust laws. The complaint seeks monetary damages 1984 16,318 1,267 and a trebling of such damages, and certain injunctive re-1985 12,151 912 lief, and alleges that the Company (i) is engaging in anti-1986......................................8,695 602 1987.......................................

4,869 336 competitive behavior by charging more for wholesale For Periods Thereafter 5,398 7,462 electricity sold to the resale customers than the Company T

charges certain classes of its retail customers, and (ii) has T

u ln

.5 taken action alone and in concert with other utilities to Less amount representing interest..............14,156 prevent or limit such resale customers from obtaining Present value of future minimum rental bulk power supplies from other sources to reduce or re-commitments............................$53,695 place the resale customers' wholesale purchases from the Company. The plaintiffs have estimated their actual dam-fuel The u5recmer cos betn a

ages before trebling at approximately $68,100,000 through July 31, 1982, and at approximately $38,000,000 for the period August 1, 1982 to July 31, 1985. The foregoing pro-Note 4-Compensating Balances and Short-term Debt ceedings involve complex issues of law and fact, and, although the Company is unable to predict their final out-In order to continue lines of credit with various banks, come, it has categorically denied the allegations of these the Company presently maintains deposits aggregating resale customers.

approximately $12,000,000 which are not legally restricted as to withdrawal. The lines of credit, which are also Note 3-Leases available to support commercial paper, amounted to

$552,000,000 as of December 31, 1982, and $551,000,000 as Rental payments charged to operating expenses of December 31,1981. In addition, the Company also has amounted to $39,542,000, $39,087,000 and $25,327,000 for lines of credit totaling $35,000,000 as of December 31, 1982 1982, 1981 and 1980, respectively.

and December 31, 1981, which may be utilized for general corporate purposes.

The Company leases nuclear fuel to meet its fuel re quirements at the San Onofre Nuclear Generating Station.

The Company has an additional $150,000,000 line of credit Under the terms of the lease agreement, quarterly pay-which may be utilized only for the purchase of fuel oil ments are based upon consumption of the nuclear fuel through the use of bankers' acceptances. Notes issued and are designed to return to the lessor the accumulated under this agreement are secured by a pledge of the Coi investment in nuclear fuel and a financing charge on pany's fuel oil inventory.

unrecovered costs.

The Company has guaranteed commercial paper and The nuclear fuel lease and certain other leased property notes payable (included on the Company's balance sheet) would meet the criteria requiring capitalization under an issued by its wholly-owned subsidiary engaged in Accounting Standard issued by the Financial Accounting financings. Proceeds from the issuance of the commercial Standards Board. However, since these leases are treated paper and notes payable are used for capitalization of an as operating leases for ratemaking purposes, they have affiliate engaged in Eurodebenture borrowings. The lines been accounted for in the same manner. If such leases of credit available for the issuance of commercial paper had been capitalized, related assets and liabilities of ap-amounted to $103,600,000 at December 31, 1982.

proximately $489,595,000 and $367,800,000 would have been recorded at December 31, 1982 and December 31, Note 5-Taxes 1981, respectively. The difference between imputed depre ciation and interest expense for these capital lease prop-In accordance with CPUC requirements, deferred income erties and actual recorded lease expense is insignificant.

taxes are generally not provided for net increases or de creases in income tax expense which result from reporting At December 31, 1982, estimated rental commitments for certain transactions for income tax purposes in a period unrecorded capital leases and noncancelable operating different from that in which they are reported in the leases consisted of the following:

financial statements. The major items for which deferred income taxes are provided are the tax effects of resale revenues, depreciation related to plant additions after December 31, 1980 (post-1980 property), and regulatory balancing account provisions.

28

Southern California Edison Company A portion of the Company's Investment Tax Credits (ITC)

Note 6-Research and Development has been applied as a current reduction of income tax expense. Additional ITC, permitted by the Tax Reduction Research and Development (R&D) costs are expensed cur Act of 1975 and the Tax Reform Act of 1976, have been de-rently if they are of a general nature. Plant-related R&D ferred and are being amortized as reductions to income costs are accumulated in construction work in progress tax expense ratably over the lives of the properties which until a determination is made as to whether such projects gave rise to the credits.

will result in construction of electric plant. If no construc tion of electric plant ultimately results, the costs are gen For post-1980 property, provisions of the Economic Recov-erally charged to other operation expenses.

ery Tax Act of 1981 apply to tax depreciation and ITC.

Under these provisions, tax depreciation is based upon Thousands of Dollars shorter lives, and additional ITC are available. In addi-Year Ended December 31, tion, there are provisions which require the adoption of 1982 1981 1980 normalization accounting for post-1980 property with re-R&D costs charged to expense

$25,998

$26,542

$21,964 spect to the difference between tax depreciation and de-R&D costs deferred/capitalized 24,218 32,047 20,165 preciation of tax basis using book method and lives. There Total R&D expenditures...........$50,216

$58,589

$42,129 are also provisions which no longer permit the flow through of ITC. Under transitional rules of the Act, these Note 7-Employee Benefit Plans normalization provisions were not applicable to the Com pany for 1981 but did first apply, in part, in 1982.

Pension Plan Supplementary information regarding taxes on income The Company's current pension program is based on a and other taxes is set forth in the following table:

trusteed pension plan, which is non-contributory by em Thousandsployees.

The annual normal cost of the plan is funded by Thouandse D

ollabrs3 the Company with contributions determined on the basis Year Ended Deber of a level premium funding method. There are no un 1982 1981 1980 Current:

funded prior service costs. Pension costs are reserved for Federal.......................

$140,350

$ 44,800

$ 38,582 on the basis of actuarial determinations and amounted to State.........................

55,621 25,629 36,909

$42,079,000, $36,137,000 and $40,321,000 for 1982, 1981 and 195,971 70,429 75,491 1980, respectively.

Deferred-Federal and State:

Investment tax credits-net....

64,612 47,386 25,235 Regulatory balancing accounts..

(192,726) 26,548 (107,322)

January 1, Other........................

8,739 (759) 14,921 1982(a) 1981 (119,375) 73,175 (67,166)

Actuarial present value of accumulated Total taxes on income............

$ 76,596

$143,604

$ 8,325 plan benefits:

-Vested............................

$449,580

$383,676 Taxes on income included in operating expenses............

$177,251

$197,865

$ 38,683 Taxes on income included in

$471,703

$400,297 other income.................

.(100,655)

(54,261)

(30,358)

Net assets available for benefits...........$507,966

$478,658 Total taxes on income............

$ 76,596

$143,604

$ 8,325 Differences between the federal (a) Latest available information.

statutory tax rate and the Company's effective tax rate are reconciled as follows:

An actuarial rate of return assumption of 6.5% was used Federal statutory tax rate.....

46.0%

46.0%

46.0%

in determining the actuarial present value of accumulated Allowance for debt and equity benefits as of J 1, 1982 and 1 1981.

funds used during construction...............

(22.0)

(16.9)

(22.9)

Percentage repair allowance (3.5)

Administrative and general expense capitalized........

(2.1)

(1.5)

(3.4)

Investment tax credits-net.

(5.0)

(4.3)

(6.8)

Nuclear fuel lease interest capitalized........

(3.3)

(3.0)

(3.3)

Taxes capitalized.............

(3.3)

(2.3)

(2.3)

State tax provision.............

1.9 4.9 2.1 All other differences.........

(0.1)

(0.2)

(3.3)

Effective tax rate.................

12.1%

22.7%

2.6%

Other taxes included in operating expenses:

Property...................

$ 46,126

$ 41,632

$ 54,114 Payroll and other.............

19,360 18,253 15,538

$ 65,486

$ 59,885

$ 69,652 29

Southern California Edison Company Notes to Financial Statements (continued)

Employee Stock Purchase Plan-Note 8-Quarterly Financial Data Under the Employee Stock Purchase Plan (ESPP), adopted to supplement employees' income after retirement, em-Thousands of Dollars ployees may elect to contribute specified percentages of Operating Operating Net Earnings their regular monthly base pay to a trustee for the pur-Decee 31, 12,53

$135,574

$13,41

$1.23 chase of Company Common Stock and the Company con-Sepember 3,1982 1,11,617 169,066 166,858 1.55 tributes to the ESPP an amount equal to one-half of the June 30, 1982...........1,047,426 120,636 126,786 1.15 employees' contributions, less forfeitures. The Company's March 31, 1982.........1,129,236 111,451 124,691 1.18 contributions to the ESPP amounted to $4,687,000,113,026 127,862 1.27 cotrbuios o heESP montd o 4,8700,September 30, 1981 1,122,674 150,996 147,944 1.51

$4,452,000 and $3,679,000 for 1982, 1981 and 1980, respec-June 30, 1981...........983,848 121,409 113,939 1.13 tively. In addition, employees may elect to contribute up March 31,1981..........908,514 105,724 100,167 1.00 to 5% of their regular monthly base pay through supple-Sepember 3, 1980 1,05,96 1,011 88,427 0.99 mental contributions without regard to years of service.

June 30, 1980...........828,028 88,996 76,929 0.84 These supplemental contributions are not matched by March 31,1980.........

804,946 88,478 81,685 0.96 the Company.

Note 9-Jointly-Owned Utility Projects Effective July 1, 1982, the ESPP was amended to permit certain participants to make annual elections to diversify The Company owns undivided interests in several jointly a portion of their accumulated contributions for Company owned generating stations and transmission systems for Common Stock to other authorized forms of investments.

which each participant must provide its own financing.

The Company's proportionate share of expenses pertain Employee Stock Ownership Plan-ing to such projects is included in the appropriate cate Under the Employee Stock Ownership Plan (ESOP),

gory of operating expenses in the Statements of Income.

shares of Company Common Stock are purchased for the In the table below, the amounts represent the Company's benefit of eligible employees and held in trust using share for each such project as reported on the Balance funds generated by additional 1% and 2% investment tax Sheets:

credits and matching employee contributions for the 2%

Thousands of Dollars ITC. The Company has elected the additional 1% ITC for December 31, 192 the years 1976 through 1981, and the 2% ITC for the years Estimated Utility Accumulated Construction 1978 through 1981. As of December 31, 1982, 2,563,249 shares of Common Stock were held by the Trustee under Projects Service Depreciation Progress Interest the ESOP. In addition, as of December 31, 1982, the Axis Generating Station.

$ 12,289

$ 7,605 99 33.3%

Brawley Geothermal Company had a liability to the ESOP in the amount of Generating Project.........9,813 4,636 47 50.0

$13,527,000.

Cool Water Coal Gasification 18,060 16.7 El Dorado System...........

21,130 5,896 (223)

60. 0(a)

Four Corners Generating For the years 1978 through 1981 the amounts of ESOP ITC Staion-Units 4 & 5.

112,359 35,521 145,007 48.0 were higher than those utilized in the Federal income tax Mohave Generating Station 191,823 52,263 4,014 56.0 returns for such years. All of the 1978, 1979 and 1980 Pacific Intertie DC System...

69,096 20,493 968 50.0 Palo Verde Generating ESOP ITC were utilized in the 1980 and 1981 Federal in-Station...................

68 698,943 15.8 come tax returns. However, none of the 1981 ESOP ITC San Onofre Generating was utilized in the 1981 Federal income tax return. If not Station-Unit 1...........288,543 72,313 90,858 80.0 San Onofre Generating completely utilized in 1982 or future income tax returns, Station-Units 2 & 3.......-

2,764,854 75.05 the excess ITC would expire in 1996, in which event the San Onofre Generating Company would be allowed a tax deduction for the Station, Common Facilities-Units 1, 2, & 3..

23,945 4,019 32,295 75.87 amounts contributed to ESOP.

Solar One Generating Station..................

16,992 2,241 976 80.0 Total................

$746,058

$204,987

$3,755,898 (a) Represents a composite rate.

30

Southern California Edison Company Note 10-Long-term Purchased Power and Additional information as of December 31, 1982 pertaining Transmission Contracts to both purchased power and transmission service con tracts is summarized in the following table:

Under firm contracts, the Company has agreed to pur chase portions of the generating output of certain facili-Dollars in Thousands ties and to purchase firm transmission service where Purchased Transmission appropriate. Although the Company has no investment Power Service in such facilities, these contracts provide that the Com-Date of Expiration...................1984-1987 1984-2016 pany pay certain minimum amounts (which are based at Varac ts of least in part on the debt service requirements of the pro-Required Future Minimum vider) whether or not the facility or transmission line is Annual Payments operating. None of such power contracts provides, or is 1984................................9,593 6,855 expected to provide, in excess of five percent of the Com-1985 1,560 5,696 pany's current or estimated future operating capacity. The 1986 1,644 5,581 cos o dfim eric un 1987................................

723 5,465 cost of power and firm transmission service obtained un-Later years.........................

108,175 der the contracts, including payments made when a facil-Total................................23,186 138,762 ity or transmission line is not operating, is included in Less Amount Representing Interest to Purchased Power and Other Operation Expenses, respec-Reduce Total to Present Value (1,324)

(79,302) tively, in the Statements of Income. Certain information Total at Present Value.................$21,862

$ 59,460 as of December 31, 1982, pertaining to purchased power Total Purchases for the Years Ended contracts is summarized in the following table:

December 31, 1982..............................

$39,414

$ 7,409 1981..............................

$36,603

$ 7,658 Dollars in Thousands 1980D..............................$38,121

$ 8,155 Share of Effective Operating Capacity-Components of Megawatts (MW) (a).........................718..5

-a a

Share of Energy Output1......................97.9%-14.6%

of actual operating, maintenance, andfuel costs or on the US Government Total Estimated Annual Cost1..................9.$41,574 cost of service.

Company's Portion of Estimated Annual Cost Applicable to Suppliers' Annual Minimum Debt Service Requirement 18....$

5,326 Company's Allocable Portion of Interest of Suppliers included in Annual Minimum Debt Service Requirement 73$

3,525 Related Long-term Debt or Lease Obligations Outstanding of CompanyL..................a None (a) Effective operating capacity may vary according to water availability and other conditions. The Company has agreed to certain reductions in its share of operating capacity prior to the expiration date of a certain contract.

31

Southern California Edison Company Supplementary Information to Disclose the Effects of in accordance with the requirements of the Financial Changing Prices (Unaudited)

Accounting Standards Board (FASB) for the purpose of providing certain information about the effects of The Company's primary financial statements are stated both general inflation (represented by constant dollar on the basis of historical costs in accordance with generally amounts) and changes in specific prices (represented accepted accounting principles. During periods of by current cost amounts).

significant changes in price levels, amounts reported on This information inherently involves the use of assump this basis reflect dollars of varying purchasing power tions, approximations and estimates, and therefore, and accordingly do not measure the effects of inflation.

should be viewed in that context and not as precise The following supplementary information is presented measurements of the effects of inflation on the Company.

Thousands of Dollars Statement of Earnings Available for Common and As Reported Adusted Adjusted For a

in the ciicpies (r

shanges in Original Preferred Stock Adjusted for Changing Prices Primary General Specific Financial Inflation (a)

Prices (a) for the Year Ended December 31, 1982 Statements (Constant Dollar)

(Current Cost)

Total Operating Revenues.........................................

$4,302,602

$4,302,602

$4,302,602 Operating Expenses:

Provision for depreciation.......................................

220,927 506,000 606,000 Other operating expenses.......................................

3,544,948 3,544,948 3,544,948 Other income and deductions (345,676)

(345,676)

(345,676)

Net interest charges..............................................

326,649 326,649 326,649 Dividends on cumulative preferred and preference stock..............

72,396 72,396 72,396 3,819,244 4,104,317 4,204,317 Earnings available for common and original preferred stock (excluding reduction of utility plant to net recoverable cost)...........

$ 483,358

$ 198,285(b) $

98,285 Other Adjustments For Changing Prices:

Increase in specific prices (current cost) of utility plant held during year (c)

$1,145,048 Reduction of utility plant to net recoverable cost

$ (55,256)

(468,089)

Effect of increase in general price level on utility plant (631,648)

Excess of increase in specific prices over increase in general price level, after reduction to net recoverable cost 45,311 Gain from decline in purchasing power of net amounts owed.........

$ 205,561

$ 205,561 (a) In average 1982 dollars.

(b) Including the reduction to net recoverable cost, the earnings available for common and original preferred stock on a constant dollar basis would have been $143,267,000 for 1982.

(c) At December 31, 1982, current cost of utility plant, net of accumulated depreciation (but exclusive of deferred income taxes) was $15,835,636,000 while related historical cost and net recoverable cost was $8,578,411,000.

32

Southern California Edison Company Supplementary Information (continued)

Five Year Comparison of Selected Supplementary Financial Data Adjusted for the Effects of Changing Prices (Data adjusted for the effects of changing prices are reported in average 1982 dollars.)

Year Ended December 31, In Thousands of Dollars, Except Per Share Amounts 1982 1981 1980 1979 1978 Total Operating Revenues As reported................................

$4,302,602

$4,054,356

$3,661,117

$2,563,974

$2,328,798 In constant 1982 dollars......................

$4,302,602

$4,305,893

$4,291,577

$3,411,948

$3,447,908 Earnings Available for (Loss on) Common and Original Preferred Stock (a)

As reported................................

$483,358

$422,024

$256,586

$292,481 In constant 1982 dollars......................

$198,285

$165,897

$ 45,183

$161,175 At current cost..............................

$ 98,285

$ 76,686

$(50,938)

$ 74,678 Earnings (Loss) Per Share on Common and Original Preferred Stock (a)

As reported................................

$5.13

$4.93

$3.50

$4.56 In constant 1982 dollars......................

$2.10

$1.94

$.62

$2.51 At current cost..............................

$1.04

$.90

$(.70)

$1.16 Excess of Increase in General Price Level Over Increase in Specific Prices of Utility Plant after Reduction to Net Recoverable Cost.......

$ (45,311)

$279,785

$490,803

$660,243 Net Assets at Year End at Net Recoverable Cost As reported........

$3,392,864

$2,968,108

$2,529,577

$2,233,133 In constant 1982 dollars and current cost........$3,334,088

$3,043,862 - $2,836,459 - $2,810,114 Gain from Decline in Purchasing Power of Net Amounts Owed.............................

$205,561

$397,850

$521,504

$601,829 Cash Dividends Declared Per Common Share As reported................................

$3.38

$3.10

$2.84

$2.60

$2.30 In constant 1982 dollars......................

$3.37

$3.27

$3.29

$3.42

$3.37 Market Price Per Share at Year End In historical dollars..........................

$35.125

$28.75

$25.625

$24.50

$25.75 In constant 1982 dollars......................

$34.52

$29.48

$28.69

$30.83

$36.72 Average Consumer Price Index (Base Year 1967 = 100)........................

289.3 (b) 272.4 246.8 217.4 195.4 (a) Excludes Reduction of Utility Plant to Net Recoverable Cost.

(b) Estimated.

The amounts adjusted for general inflation represent the extent that prices in general have increased more or historical costs of utility plant restated in terms of dollars less rapidly than specific prices. The current cost of utility of equal purchasing power (constant dollars) as measured plant represents the estimated cost of replacing existing by the Consumer Price Index for all Urban Consumers.

plant assets and was determined by restating its historical This method is intended to measure income after restating cost using indices reported in the Handy-Whitman Index all revenues and expenses in dollars of equivalent pur-of Public Utility Construction Costs. This method is in chasing power.

tended to measure income after reflecting the cost of pro The current cost amounts reflect the changes in specific viding electric service at current price levels.

prices of utility plant from the date the plant was acquired In accordance with procedures specified by the FASB, to the present, and differ from constant dollar amounts to total operating revenues and all expenses other than 33

Southern California Edison Company Supplementary Information (continued) depreciation were considered to reflect the average price or current cost, exceeding the historical cost of utility level for the current year and accordingly remain un-plant is not presently recoverable through depreciation changed from those amounts reported in the Company's charges, and, accordingly, the excess is reflected as a re primary financial statements. The current year's provision duction of utility plant to net recoverable cost. While the for depreciation on the constant dollar and current cost ratemaking process gives no recognition to the current amounts of utility plant was determined by applying the cost of replacing utility plant, based on past ratemaking Company's average annual depreciation rates to the practices, the Company believes it will be allowed to re indexed plant amounts.

cover and earn a return on the increased cost of its No adjustments to income tax expense have been made investment when replacements of utility plant occur.

in computing the impact of inflation since only historical During inflationary periods, holders of monetary assets costs are deductible for income tax purposes.

experience a loss of general purchasing power while hold Fuel inventories and the cost of fuel consumed in the ers of monetary liabilities experience a gain. The gain generation of electricity have not been restated from their from the decline in purchasing power of net monetary historical cost. The recovery of fuel and purchased power liabilities (net amounts owed) is primarily attributable to costs are limited to historical costs through the operation the substantial amount of debt which has been used to of the Company's energy cost adjustment clauses. For this finance utility plant. However, to properly reflect the eco reason fuel inventories and deferred recoverable energy nomics of rate regulation, the gain from the decline in costs are effectively monetary assets.

purchasing power of net amounts owed, including Under ratemaking procedures prescribed by the regula-Cumulative Preferred and Preference Stock, is offset by tory commissions exercising rate jurisdiction over the the reduction to the recoverable cost of utility plant. The Company, only the historical cost of utility plant is re-Company, therefore, does not have the opportunity to coverable through future depreciation charges. Therefore, realize such holding gain on net amounts owed.

the cost of utility plant, stated in terms of constant dollars Operating Revenues and Kilowatt-Hour Sales Class of Service Operating Revenues (Thousands of Dollars)

Kilowatt-Hour Sales (000)

% of o

of p

1982 total 1982 1981 chxnge 1982 total 1982 1981 change Residential................

28.7

$1,233,338

$1,115,758 10.5 27.7 16,403,116 16,688,956 (1.7)

Agricultural................

1.6 68,281 75,257 (9.3) 1.5 856,929 1,116,308 (23.2)

Commercial...............

28.5 1,226,532 1,090,694 12.5 26.2 15,557,692 15,562,087 Industrial.................

25.9 1,112,784 1,063,823 4.6 26.4 15,675,707 17,000,598 (7.8)

Public Authorities.8.4 363,572 331,972 9.5 7.6 4,515,855 4,667,700 (3.3)

Interdepartmental t

127 77 64.9 1,279 1,218 5.0 Resale....................

5.4 232,095 244,720 (5.2) 7.1 4,237,698 4,539,467 (6.6)

Subtotal...................

98.5 4,236,729 3,922,301 8.0 96.5 57,248,276 59,576,334 (3.9)

Resale-Special Contracts l.5 23,067 99,240 (76.8) 1.0 609,119 1,639,158 (62.8)

Public Authorities Special....................

2 7,154 5,007 42.9 2.5 1,469,458 1,235,827 18.9 Total Sales of Electric Energy..................

99.2 4,266,950 4,026,548 6.0 100.0 59,326,853 62,451,319 (5.0)

Other Electric Revenues t t

.8 35,652 27,808 28.2 Total.....................

100.0

$4,302,602

$4,054,356 6.1 100.0 59,326,853 62,451,319 (5.0) 34

Southern California Edison Company Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations (ECAC). The AER is a fixed rate established once-a-year For 1982, earnings per share increased by 4%, from $4.93 and designed to recover a portion of estimated annual di to $5.13, the highest in the Company's history.

rect and indirect fuel costs. Direct fuel costs include fuel The Company's earned rate of return on common and purchased power. Indirect fuel costs include carrying equity for the year was 14.89% as compared with the 14.95%

charges on fuel oil inventory and other fuel related ex rate authorized for 1982. This marks the third time in penses. For 1982, indirect fuel cost estimates and 2% of di four years the Company has earned a rate of return on rect fuel costs estimates were included in the AER. The common equity at essentially the level authorized by the CPUC made changes in this procedure scheduled to go California Public Utilities Commission (CPUC). Effective into effect in May 1983. The most significant change is to January 1, 1983, the Company was granted a general incorporate 10% of the estimates of both direct and idi rate increase by the CPUC of $590 million annually with rect fuel costs in the AER. The remaining 90% of these an authorized rate of return on common equity of 16%.

costs, as recorded, is designed to be recovered through The following table presents amounts and percentages the tn-annual ECAC. This means that 90% of the Coi of increase (decrease) in the rate components of operating pany's total recorded direct and indirect fuel costs should revenues from the prior years.

be recovered through ECAC, but that 10% of any differ Increase (Decrease)

Dollars in millions ence between estimated and recorded annual fuel costs is from Prior Years 1982 1981 1980 at risk under the new AER procedure. The CPUC deci Operating Revenues:

sion limited this AER-related risk to a maximum positive Energy Cost Adjust-or negative amount which, in 1983, approximates $32 mil ment Billing Factor $ 151 7.0 $

(19)

(0.9) $ 973 80.6 lion. The CPUC believes that such treatment provides an Annual Energy Rate 136 (a) 32 incentive for more efficient fuel management.

Base Rates 40 2.7 280 23.3 31 2.6 The following table presents amounts and percentages Resale & Special Contracts (87) (24.8) 102 41.5 74 43.0 Other Electric items fr om the Statements of Income.

Revenue 8

28.2 (2)

(6.5) 19 174.2 Dollars in millions, Total Operating Increas_(Decrase)_ExeptEaningsPrShar Revenues

$ 248 6.1

$ 393 10.7

$1,097 42.8

___from Prior Years 1982 1981 1980 KWH Sales (Millions)

(3,124)

(5.0) 2,536 4.2 397 0.7 Other Operation Expenses

$ 55 12.4

$ 49 12.6 $

70 21.9 Customers 42,457 1.3 68,719 2.2 81,586 2.6 Maintenance Expense 17 8.7 (35) (15.3) 51 28.7 (a) Indicates over 200%.

Taxes on Operating Income (21) (10.4) 159 (a)

(62) (61.4)

Total operating revenues for 1982 reflected an overall in-Operating Income 46 9.3 119 32.0 (13)

(3.3) crease in rates which was partially offset by a decrease in Allowance for Debt and kilowatt-hour sales. The increased revenues were a result Equity Funds Used During Construction 71 30.3 70 43.3 44 36.9 of higher revenue from the Energy Cost Adjustment Other Income 29 27.1 41 63.0 18 37.8 Billing Factor (derived through application of ECAC pro-Total Interest Charges 79 23.3 58 20.6 78 37.8 visions) which revenue is based upon higher fuel and Net Income 66 13.4 172 54.3 (29)

(8.3) purchased power costs and thereby does not affect earn-Earnings Available for ings, increases in the annual energy rate revenues and Common and Original Preferred Stock 61 14.5 165 64.5 (36) (12.3) higher base rates. Resale and special contracts revenues Earnings Per Share

$20 4.1

$1.43 40.9 $(1.06) (23.2) were down from 1981 primarily as the result of reduced Weighted Average Number sales and rates. Kilowatt-hour sales decreased 5.0% for of Shares (Millions) 9 10.1 12 16.9 9

14.1 1982 primarily as a result of mild summer weather con-(a) Indicates over 200%.

ditions experienced in Southern California and the im-Increases in other operation expenses continue to be pact of reduced economic activity. These factors were due to system growth and to the impact of inflation on coupled with the smallest increase in the number of total the costs of labor, material and services. The Company is customers since 1945.

continuing its efforts to control these expenses with The general rate decision granted in December 1982 also continued emphasis on productivity and cost controls; established an Electric Revenue Adjustment Mechanism however, certain of these expenses which are not directly (ERAM), the purpose of which is to stabilize base rate rev-affected by cost controls accounted for a substantial enues regardless of fluctuations in the level of kilowatt-portion of the increase in other operation expenses.

hour sales. This procedure, along with an attrition Year-to-year variations in levels of maintenance ex allowance for 1984, affords the Company an opportunity pense have been significantly influenced by inflation, to again earn its authorized rate of return. In a separate scheduling of major maintenance projects and weather decision, the CPUC modified the Annual Energy Rate (AER) component of the Energy Cost Adjustment Clause 35 chares n fel ol ivenory nd the fue reate ex

Southern California Edison Company Management's Discussion and Analysis (continued) conditions. The latter was responsible for $13 million of of construction work in progress primarily related to the the increase in 1982 because of severe property damage construction of San Onofre Units 2 and 3, a significant suffered during storms in November and December.

portion of the Company's net income in recent years has Taxes on operating income for 1982 decreased from been attributable to AFUDC which, although providing an 1981 primarily as a result of lower pre-tax net income and offset for the higher money costs incurred because of the higher net tax deductions.

construction program, does not represent current cash in The $46 million increase in operating income reflected come of the Company. AFUDC constituted approximately the continued emphasis on cost control and productivity 55%, 47% and 51% of net income for the years 1982, 1981 improvement. Also, an attrition allowance rate increase at and 1980, respectively. AFUDC is expected to decline the beginning of the year helped offset non-fuel inflation-significantly when San Onofre Units 2 and 3 are placed in ary cost increases.

service with a resulting reduction in this non-cash portion The increase in earnings available, in addition to reflect-of net income. Assuming the costs incurred in connection ing higher operating income, also reflected increases in with the construction and operation of these units receive other income and the non-cash allowance for funds used appropriate and timely rate treatment, sufficient revenues during construction (AFUDC) partially counteracted by would be produced through rates to offset the decline in increases in interest charges and dividends on cumulative AFUDC.

preferred and preference stock.

First phase hearings on the Major Additions Adjust The higher interest charges were due to additional long-ment Clause (MAAC) resumed during January 1983 to term debt outstanding and higher interest rates. The consider the appropriate procedure for recovering the additional indebtedness was incurred by the Company costs associated with owning, operating and maintaining primarily in connection with its continuing construction San Onofre Unit 2. The second phase of the hearings, program, which is also responsible for the increasing which will address the reasonableness of the Company's levels of the non-cash AFUDC.

investment in Unit 2, is expected to take place in late 1983 Although earnings available for common and original or early 1984.

preferred stock increased in 1982 by $61 million, the Com pany's issuance of additional shares of common stock in-Capital Resources creased the average number of shares outstanding during To provide the funds for construction expenditures for the year and resulted in a net increase in earnings per the five years through 1987 estimated to total $4.2 billion share of 20o.

and to meet long-term debt maturities and sinking fund A discussion relating to the effects of changing prices requirements and preferred stock redemption require follows the "Notes to Financial Statements" beginning on ments aggregating $899 million during such years, the page 32.

Company estimates that approximately $2.6 billion, or 50%, of such expenditures will be provided from external Liquidity sources. The balance of funds required for these purposes Liquidity refers to the ability of a company to generate is expected to be obtained from operations, primarily dur funds, whether from operations, long-term financings ing the latter part of such period, with a majority of con or other sources, adequate to meet the requirements of struction funds in 1983 projected to be obtained from its construction program. The following table provides a external sources.

summary of the Company's sources of funds used for con-The Company's estimates of funds available from opera struction expenditures for the years 1982, 1981 and 1980.

tions for the five years through 1987 assume the receipt of Dollrs i milions adequate and timely rate relief, the timely inclusion of the Dollars in millions 1982 1981 1980 additional San Onofre Units and the Palo Verde Units in 1982 1981 1980 Fund frm Opraton sReinveted 24

$ 14

$125 rate base and the realization of its assumptions regarding Funds from Operations-Reinvested

$ 243

$ 174

$ 125 cotiresinldgthcstfTeCi Funds from Long-term Financing-net 828 800 533 capital.

Other Sources (Uses) of Funds (77)

(17) 124 pany's estimates and underlying assumptions are subject Funds Used for Construction Expenditures

$ 994

$ 957

$ 782 to continuous review and periodic revision.

FudsPrvie b Oerton aaPrcnt The timing, type and amount of all additional long Funds Provided by Operations as a Percent of Funds Used for Construction Expenditures 24%

18%

16%

term financing are also influenced by market conditions, rate relief and other factors, including limitations imposed The Company is engaged in an extensive construction by the Company's Articles of Incorporation and Trust program designed to accommodate existing and projected Indenture.

demands of its electric system. Because of the high level 36

Southern California Edison Company The Company's long-term goal is to maintain a capital trustees and the conversion of preference stock, amounted structure with approximately equal amounts of debt and to $828 million in 1982. This reflects pollution control equity. The Company's capital structure at the end of the equipment financing bond issues and unsecured debt of years 1982, 1981 and 1980 is shown below:

ferings in the European market, as well as traditional 1982 1981 1980 public and private debt and equity offerings. In addition, Long-Term Debt 47.9%

47.3%

46.3%

the Company uses short-term borrowings as a part of Preferred and Preference Stock 11.1 12.0 13.9 normal daily operations and to meet interim cash needs Common Equity 41.0 40.7 39.8 for capital projects. The Company has a total of $841 100.0% 100.0% 100.0%

million of available short-term borrowing facilities with foreign and domestic banks.

Funds provided by long-term financing, after giving effect to the reduction of long-term debt, securities held by Capital StockiDividend and Price Information Quarterly High and Low Sales Prices td Dividends Calendar Quarter-1982 Calendar Quarter-1981 Paid Class and Per 1

2 3

4 1

2 3

4 Series of Stock Share (a) (br High Low High Low High Low High Low High Low High Low High Low High Low Originalg d

s b

-Preferred

.81 29 /

24 /

29 /

251/2 31 25 /

34 /

30 /

247/8 22 26 22 /

27 23 /

271/2 24 Cumulative Preferred:

4.08%

.25 /

8 /

65/

7-

/

67/8 81/2 7 9 /

7 /

85/

7 8 /

7 77/

65/

8 /

6 /

4.24%

.26 /

81/4 61/

8 71/8 9 /

7 /

9 /

8 /

87/s 7 /

8/8 7/4~ 87/8 6/8 9'/2 6/8 4.32%

.27 81/s 7

83/

7 91/4 7 /

95/

8 /

81/2 75/8 81/2 71/8 8 /

7 81/4 6 /

4.78%

.297/

85/

71/2 9

7 /

9-

/

7-/

107/

9 91/8 77/

9 /

7-

/

9

"/

7 /

9 7 /

5.80%

.361/4 105/

91/ 10 /

9 2 13 97S 12/8 11 /

11/8 10 11/8 9 /

10 /

9 /

10/8 9

8.85%

.553125 16 14 /

165/

141/

181/4 143/

191/

16/8 17 155/

16 /

14/8 157/8 141/8 161/

14 9.20%

.57 /

163/8 14 /

17 /

15 /

19 15-2/8 201/4 17 /

17 3/

16 17 151/8 165/s 14 /

171/8 14 /

$100 Cumulative Preferred:

7.325% (b) 1.83 A 7.58%

189 n

541/2 47 C

56 49 r 60 501/2 66C/a 57 57l 54 557/s 50 54 481 53 48 7.80% (b) 1.95 8.54%

2.13 /

633 59 70 /

623/

73 69 83 /

68 (c)

(c)

(c)

(c) 725/

62 /

62 /

61 /

8.70%

217 62 55/2 64 57s 685 58 76 65s 66 59 64 57 62 54 61 55 8.70%-A (b) 2.17/-

8.96%

2.24 61%

56 64 60 71/

603 78 68 68 63 66 61 64 58228 66 56 4 12.00%

3.00 89 81 /

100 90 102 89 /

106/s 99 100-9/

95 99 94 /

97 /

88 /

9 3 /

82- /

12.31 %(b) (g).34194444 Preference:

5.20%

.322 25/2 22-26 24 28 23 29 25%

20 17 215 19 21 19 24 20 Convertible:

7.375% (b)

.460938 Common(d)(e)

.81 32 28 335/

297/s 35 29 37 31 26 227 28 24 28504 42 30 268 (a) Quarterly dividends were paid at the rates indicated in each quarter of 1982 except the fourth quarter dividend on Original Preferred Stock and Common Stock which was at the rate of $0.88 per share.

(b) There are no prices as these issues are private placements and shares are not traded.

(c)

No shares traded.

(d) Dividends declared on Common Stock totaled $3.38 and $3.10 for 1982 and 1981, respectively.

(e) As of December 31, 1982, there were approximately 155,000 Common Stock shareholders.

(0) The Indenture securing the Company's First and Refunding Mortgage Bonds provides, in substance, that the Company shall not pay any cash dividends except out of its earnings reinvested in the business and net income.

(g) Initial pro rata dividend paid April 30, 1982. Subsequent quarterly dividends to be paid at $3.0775 per share or $12.31 annually.

37

Southern California Edison Company Selected Financial Data 1972-1982 1982 1981 Summary of Operations Operating Revenues....................................$

4,302,602

$4,054,356 (in thousands of dollars Operating Expenses.....................................3,765,875 3,563,201 except percent and Fuel and Purchased Power Costs (a).......................

2,227,901 2,558,206 per share data)

Taxes on Income-Current and Deferred (a) 177,251 197,865 Allowance for Debt and Equity Funds Used During Construction.........................................

303,118 232,552 Interest Charges........................................

420,282 340,977 Net Income.............................................

555,754 489,912 Earnings Available for Common and Original Preferred Stock......................................$

483,358

$ 422,024 Weighted Average Shares of Common and Original Preferred Stock Outstanding and Common Stock Equivalents.94,257 85,610 Per Share Data:

Primary Earnings.....................................

$5.13

$4.93 Fully Diluted Earnings.................................

$5.09

$4.91 Dividends Declared Per Common Share..................

$3.38

$3.10 Dividend Payout Ratio (paid basis).........................

64.5%

61.5%

Balance Sheet Data Total Assets (b).........................................

$10,157,564

$8,702,571 (in thousands of dollars except Gross Utility Plant......................................

10,764,078, 9,517,670 percent and per share data)

Accumulated Provision for Depreciation.....................

2,185,667 2,015,212 Percent of Gross Utility Plant..............................

20.3%

21.2%

Long-term Debt (excludes current maturities):

Bonds...............................................

3,529,647 3,224,867 Debentures............................................

Other................................................

440,753 219,213 Preferred Stock-Subject to Mandatory Redemption!

Repurchase Requirements (excludes portion to be redeemed within one year).............................3445,000 399,500 Preferred Stock-Other...................................

471,020 476,308 Common Stock, including Additional Stated Capital.....

856,152 776,523 Additional Paid-in Capital.................................1,142,932 953,268 Earnings Reinvested in the Business.......................

$ 1,393,780

$1,238,317 Capital Structure (percent):

Long-term Debt (excludes current maturities)

Bonds..............................................

42.6%

44.3%

Debentures..........................................

Other...............................................

5.3 3.0 Preferred & Preference Stock (excludes current portion)...

11.1 12.0 Common Equity........................................

41.0 40.7 Rate of Return on Common Equity..........................

14.89%

14.87%

Book Value Per Common Share.............................

$34.96

$33.74 Operating and Area Generating Capacity at Peak (MW) (c)....................

15,349 15,592 Sales Data Total Energy Requirement (KWH) (000).....................

66,578,540 69,179,641 Percent Energy Requirement:

Thermal..............................................

55.5%

67.6%

Renewable/ Alternate (including hydro).....................

9.7 5.8 Purchased Power & Other Sources (d).....................

34.8 26.6 Kilowatt-Hour Sales (000)................................

59,326,853 62,451,319 Number of Customers3..................................

03,275,144 3,232,687 Average Annual KWH Sales Per Residential Customer....

5,685 5,879 Number of Employees....................................

15,797 14,569 Area Peak Demand (MW).................................

13,149 13,738 (a) Included in Operating Expenses.

38 (b) The years 1971 through 1981 have been restated to reflect the deduction of property-related accumulated deferred income taxes from Utility Plant.

A 1980 1979 1978 1977 1976 1975 1974 1973 1972

$3,661,117

$2,563,974

$2,328,798

$2,064,914

$1,846,540

$1,647,134

$1,360,959

$1,075,949

$ 927,674 3,288,983 2,178,978 2,004,197 1,734,192 1,539,400 1,380,528 1,108,249 843,530 709,724 2,010,227 1,532,903 1,204,749 1,189,597 903,447 824,826 541,890 344,990 240,135 38,683 100,292 72,803 68,792 59,506 46,623 70,618 46,496 44,542 162,287 118,566 78,421 60,238 47,610 26,773 16,163 10,190 7,152 282,656 205,082 182,658 161,078 144,368 126,185 112,959 97,728 91,752 317,536 346,219 251,683 251,979 226,798 176,781 160,344 146,110 135,648

$ 256,586

$ 292,481

$ 202,226

$ 206,330

$ 185,047

$ 137,177

$ 124,656

$ 117,268

$ 110,469 73,241 64,202 57,477 54,347 48,678 47,965 44,580 43,965 43,965

$3.50

$4.56

$3.52

$3.80

$3.80

$2.86

$2.80

$2.67

$2.51

$3.48

$4.39

$3.38

$3.63

$3.61

$2.75

$2.68

$2.57

$2.43

$2.84

$2.60

$2.30

$2.06

$1.68

$1.68

$1.68

$1.56

$1.56 79.4%

55.7%

63.6%

50.5%

44.2%

58.7%

58.9%

58.4%

62.2%

$7,706,933

$6,949,917

$6,030,045

$5,698,068

$4,993,330

$4,701,910

$4,451,810

$3,861,572

$3,740,743 8,406,309 7,577,670 6,810,891 6,191,733 5,658,433 5,147,333 4,766,175 4,458,631 4,233,067 1,840,233 1,676,148 1,519,174 1,383,009 1,258,327 1,149,311 1,051,024 958,210 851,910 21.9%

22.1%

22.3%

22.3%

22.2%

22.3%

22.1%

21.5%

20.1%

2,938,796 2,685,632 2,388,212 2,219,716 2,055,966 1,931,757 1,863,951 1,640,349 1,640,139 75,046-

-75,135 - - -- 7-5224

- 75,313 75,401 75,490-75,579 7,028 60,575 14,216 20,023 20,671 25,968 14,327 6,871 7,991 399,500 324,500 197,000 197,000 75,000 75,000 75,000 75,000 482,652 489,822 503,650 518,172 537,753 537,753 487,753 437,753 437,753 673,921 577,259 547,166 470,374 442,741 395,709 395,709 362,376 362,376 763,519 601,578 569,673 443,109 427,422 350,503 350,503 316,636 316,636

$1,092,137

$1,054,296

$ 931,217

$ 862,956

$ 769,425

$ 671,548

$ 616,562

$ 569,938

$ 512,164 46.2%

46.4%

45.7%

46.2%

46.7%

47.5%

48.1%

47.1%

48.9%

1.4 1.5 1.7 1.9 1.9 2.2 2.3 0.1 1.0 0.3 0.4 0.5 0.6 0.4 0.2 0.2 13.9 14.1 13.4 14.9 13.9 15.1 14.5 14.7 13.1 39.8 38.5 39.2 37.0 37.2 34.9 35.1 35.8 35.5 10.44%

13.58%

10.74%

11.98%

12.40%

9.78%

9.35%

9.59%

9.42%

$33.19

$34.22

$32.57

$32.30

$30.67

$29.64

$28.50

$28.46

$27.14 15,504 15,071 14,966 14,278 14,071 13,941 13,750 13,500 12,819 65,459,278 66,216,910 63,877,116 63,344,706 59,427,973 56,279,231 55,105,988 57,730,121 55,686,776 71.2%

82.0%

73.8%

87.4%

75.1%

76.2%

75.2%

84.8%

86.4%

9.2 7.7 9.3 2.5 4.4 8.4 10.1 9.1 6.6 19.6 10.3 16.9 10.1 20.5 15.4 14.7 6.1 7.0 59,915,187 59,517,861 57,027,035 57,726,273 53,685,378 51,327,508 51,089,981 54,092,934 52,309,906 3,163,968 3,082,382 2,986,545 2,900,856 2,814,403 2,749,680 2,691,691 2,626,492 2,566,341 5,939 6,010 5,883 5,630 5,650 5,596 5,541 5,885 5,777 14,157 12,917 12,845 12,671 12,510 12,377 12,970 13,391 12,907 12,841 12,662 12,159 11,564 11,292 10,369 10,279 10,535 10,317 (c) Includes 2,080, 2,323 and 2,283 MW available from others in 1982,1981 and 1980, respectively.

(d) Includes non-Edison owned renewable/alternative sources.

39

Southern California Edison Company Board of Directors William R. Gould, Chairman of the Board and Chief Executive Officer Howard P. Allen, President Roy A. Anderson, Chairman of the Board and Chief Executive Officer, Lockheed Corporation, Burbank, California Norman Barker, Jr., Chairman of the Board and Chief Executive Officer, First Interstate Bank of California, and Vice Chairman of the Board, First Interstate Bancorp, Los Angeles, California Edward W. Carter, Chairman of the Board, Carter Hawley Hale Stores, Inc., Los Angeles, California Warren Christopher, Senior Partner, Law Firm of O'Melveny & Myers, Los Angeles, California Walter B. Gerken, Chairman of the Board and Chief Executive Officer, Pacific Mutual Life Insurance Company, Newport Beach, California Joan C. Hanley, General Partner and Manager, Miramonte Vineyards, Rancho California, California Jack K. Horton, Chairman of the Executive Committee and Consultant (Retired Chairman of the Board and Chief Executive Officer, Southern California Edison Company), Los Angeles, California Frederick G. Larkin, Jr., Chairman of the Executive Committee, Security Pacific National Bank, Los Angeles, California T. M. McDaniel, Jr., Corporate Director and Consultant (Retired President, Southern California Edison Company), San Marino, California

• John V. Newman, President, CBS-Sony California, Inc. (Citrus Production), Oxnard, California Gerald H. Phipps, President, Gerald H. Phipps, Inc., General Contractors (Building Construction), Denver, Colorado Henry T. Segerstrom, Managing Partner, C. J. Segerstrom & Sons (Real Estate Development), Costa Mesa, California E. L. Shannon, Jr., Chairinan of the Board and Chief Executive Officer, Santa Fe International Corporation (Oil Service, Engineering, Petroleum Exploration and Production), Alhambra, California H. Russell Smith, Chairman of the Board, Avery International (Manufacturer of Self-Adhesive Products), Pasadena, California

• Richard R. Von Hagen, President, Lloyd Corporation, Ltd. (Real Estate Development and Production of Oil and Gas), Beverly Hills, California Executive Officers William R. Gould, Chairman of the Board and Chief Executive Officer Howard P. Allen, President H. Fred Christie, Executive Vice President and Chief Financial Officer David J. Fogarty, Executive Vice President A. Arenal, Vice President (Engineering and Construction)

G. J. Bjorklund, Vice President (System Development)

R. H. Bridenbecker, Vice President (Fuel Supply)

John R. Bury, Vice President and General Counsel Robert Dietch, Vice President (Nuclear Engineering and Operations)

C. E. Hathaway, Vice President (Human Resources)

Joe T. Head, Jr., Vice President (Power Supply)

P. L. Martin, Vice President (Customer Service and Conservation)

A. L. Maxwell, Vice President and Comptroller Edward A. Myers, Jr., Vice President (Communications and Revenue Services)

Michael L. Noel, Vice President and Treasurer L. T. Papay, Vice President (Advanced Engineering)

Robert E. Umbaugh, Vice President (Administration)

Honor Muller, Secretary

• Messrs. Newman and Von Hagen, having reached retirement age, are not nominees for reelection to the Board of Directors in 1983.

40

4 CE Southern California Edison Company 2244 Walnut Grove Avenue Rosemead, California 91770

Distribution of Record Shareholders as of December 31, 1982 Preferred Common Total Shareholders 35,622 154,662 Class of Investor Males 6,481 35,549 Females 14,056 56,288 Joint Accounts 9,311 42,654 Fiduciaries 2,917 15,888 Religious, Charitable, Fraternal and Educational Institutions 214 529 Financial Institutions 1,351 1,779 Other 1,292 1,975 Amount of Holdings I to 99 shares 14,640 53,515 100 shares 7,957 31,319 101 to 499 shares 9,229 53,344 500 to 999 shares 1,990 11,049 1,000 or more shares 1,806 5,435 Geographical Location Service Territory 9,659 38,015 Remainder of California 11,866 46,857 United States (except California) and Possessions 14,023 69,306 Foreign Countries 74 484 1983 Annual Shareholders' Meeting:

Stock Transfer Agent:

Statistical Supplement:

The annual meeting of shareholders of Southern California Edison Company A comprehensive financial and statistical Southern California Edison Company Post Office Box 400 supplement to this report is available in will be held at 10 a.m., Thursday, April Rosemead, California 91770 limited quantity. A copy may be requested 21, 1983, at the Company's Corporate Telephone (213) 572-1393 or by writing to the Supervisor of Investor Headquarters, 2244 Walnut Grove (213) 572-1394 Relations, Southern California Edison Avenue, Rosemead, California 91770.

Company, P.O. Box 800, Rosemead, Telephone (213) 572-1212.

Registrar of Stock:

California 91770.

Security Pacific National Bank For Investor Relations:

Los Angeles, California This Annual Report and the statements and Institutional Investors contact:

statistics contained herein have been assembled Assistant Treasurer &

Dividend Reinvestment and for general informative purposes and are Manager of Investor Relations Stock Purchase Plan Agent:

not intended to induce, orfor use in connection Telephone (213) 572-1090 Bank of America N.T. & S.A.

with, any sale or purchase of securities.

San Francisco, California Under no circumstances is this report or any Individual Shareholders contact:

part of its contents to be considered a pro Southern California Edison Company Stock Exchange Listings:

spectus, or as an offer to sell, or the solicitation Secretary's Department-Room 240 Common Stock:

of an offer to buy, any securities.

Post Office Box 400 New York Stock Exchange Rosemead, California 91770 Pacific Stock Exchange London Stock Exchange For Dividend Reinvestment and Stock Purchase Plan information:

Preferred and Preference Stocks:

Telephone (213) 572-1852 or American Stock Exchange (213) 572-1995 Pacific Stock Exchange For other shareholder inquiries:

Ticker Symbol:

(Dividends, account status, etc.)

SCE (Common Stock)

Telephone (213) 572-1997 Media Listings:

SCalEd ThisAnnul Rportandthe tatment an