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

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

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

DEMAND SIDE MANAGEMENT

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

California’s Energy Action Plan = Energy resource “loading order” California’s Climate Change Policy (AB32) = GHG reductions to: –2000 levels by 2010 (11% below “business as usual”) –1990 levels by 2020 (25% below “business as usual”) –Energy Efficiency = Major source of emissions reductions in Scoping Plan California Long-Term Energy Efficiency Strategic Plan –Statewide roadmap to maximize achievement of cost-effective energy efficiency California Energy Policy: A Framework For Energy Efficiency 6 EE DR First Renewable Energy Resources Second Clean Distributed Generation Third Fossil- Fired Generation Fourth

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

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

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

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

EDISON SMARTCONNECT™ 11

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

Edison SmartConnect™ Approximately 5 Million Existing Electric Meters Will be Replaced With “Smart” Meters by the end of 2012 −Business case approved by CPUC in Program Status −4.7+ Million Smart Meters Installed −Daily Install Average: 8,000+ −Installers: 300 (average) −Approximately 266,000 Customers Enrolled in Budget Assistant −Nearly 486,000 Customers Enrolled in Save Power Day Incentive Alerts −Generating Interval Data Bills for 4 Million Customers 13 SCE’s Smart Metering Program Overview

Discovery Activation Participation 1. Pre-Installation 2. Meter Deployment 3. COTO, Interval Billing & Web Access 4. Incentive Campaigns 5. Edison SmartConnect Enabled Programs 6. Customer Feedback Edison SmartConnect™ Customer Experience Local Government Briefing Press Releases SCE.com Zip code look up Bill Onserts YouTube Channel Community Forums Pre-installation letter Corix Call Center Carl & Eddy Movie Trailers Door hanger Meter install How to read your meter Mail: Upcoming Programs Random Meter install survey Get Connected Corix Call Center Telemarketing & Web Solicitations Targeted program enrollments Shared Mail My Account Buckslips Direct Mail Social Media Online Ads SCE.com Direct Mail Budget Assistant Save Power Days Smart Energy Experience Get Connected Telemarketing Customer Enrolls Targeted Campaign Community Forums Social Media Customer Enrolls New Devices Direct Mail Targeted program enrollments Enrolls in New Rate & Web Solicitations Focus Groups Surveys Employee Information Phone Surveys SCE.com Community Forums Assessments 14

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

RENEWABLE ENERGY ROADMAP

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

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

19

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

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

SAN ONOFRE NUCLEAR GENERATING STATION (SONGS)

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

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

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

Restarting SONGS SCE will not restart the plant until the utility and the Nuclear Regulatory Commission are satisfied that it is safe to do so Safety Responsibility Transparency Our number one priority is protecting the health and safety of the public and our employees SCE takes seriously the responsibility of running the plant safely – and the trust the public places on us to safely provide reliable and clean energy We are committed to keeping our customers, our communities and the public informed on the progress and plans for San Onofre, and we will continue to do that

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

2012 SUMMER READINESS – EXCEPTIONAL CUSTOMER ENGAGEMENT

Summer Readiness SCE & CAISO routinely plan for an outage of one SONGS unit Long term loss of both units presents significant challenges Summer readiness mitigation measures activated: 1.Transmission lines were upgraded 2.The gas powered plants in Huntington Beach were temporarily restarted 3.Significant customer outreach 29

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

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