1. San Francisco May 17, 2006 AMI Briefing

2. www.sce.com/ami © Copyright 2006, Southern California Edison 2 Intelligently Connecting Edison to our Customers Enable Energy Smart Customers –Integrated information from utility –Payment options (e.g., pre-payment) –Outage & service condition information –Support rate option innovations Manage Distributed Resources –Economic dispatch of load resources –Dispatch of load for grid management –Intelligent net metering –Management of distributed energy resources Operational Efficiencies –Field communication links to distribution –Revenue cycle improvements –Situational data in near real-time –Wholesale - retail markets integration Built with the future in mind –Upgradeable WAN/HAN communications –Leverage open architecture principles in system design –Future customer service offerings SCE seeks to leverage a 2-way communications infrastructure with 5 million intelligent metering devices on our distribution network to create lasting value for our customers and our operations

3. www.sce.com/ami © Copyright 2006, Southern California Edison 3 AMI System Development Objectives Develop cost effective system requirements that are supported by multiple meter and communications vendors and is commercially viable in the NA utility market Engage other utilities and vendors in development process to provide catalyst for next generation product development Durable design that will support a solid positive business case that provides customer value Market Adoption Functionality Cost Effectiveness Engage industry standards groups, component manufacturers, high technology firms, consultants and universities to gain insights into the art of the possible

4. www.sce.com/ami © Copyright 2006, Southern California Edison 4 AMI Program Status (through April 30, 2006) Accomplishments  Released meter technology roadmap document to vendors for product evaluation and consideration before releasing requirements in June  Completed first level screen of vendor technology with encouraging results  Reconfirmed with meter vendors product availability for testing in 2006 within price target  Completed informal utility survey to assess market adoption for AMI technologies with similar functionality  Conceptual cost-benefit analysis in progress  Completed initial review of MDMS products and conceptual requirements development  Conceptual system architecture development activity focused on identification of system requirements based on cost-benefit trade-off and market feedback. Key MilestonesDateStatus AMI Technology Vendor ScreenQ1 06 Business & Functional RequirementsQ2 06 Conceptual System ArchitectureQ2 06 AMI Technology EvaluationQ2 06 Conceptual FeasibilityQ3 06 Phase II Regulatory ApplicationQ4 06 Beta Product SelectionQ1 07 Preliminary Business CaseQ2 07

5. www.sce.com/ami © Copyright 2006, Southern California Edison 5 SCE Brainstorming SCE Brainstorming Systems Engineering Methodology --- Distribution operator locates outage using AMI data and restores service Multiple clients use the AMI system to read data from devices at customer site Meter reading for gas & water utilities Utility upgrades AMI system to address future requirements -- Customer provides distributed generation Customer uses pre-payment services Utility detects tampering or theft at customer site Utility maintains the AMI system over its entire life- cycle - Utility procures energy and settles wholesale transactions using data from the AMI system Distribution operators optimize network based on data collected by the AMI system Customer reads recent energy usage and cost at site Utility remotely limits or connects/ disconnects customer Utility installs, provision and configure the AMI system AMI system recovers after power outage, communications or equipment failure Real-time operations curtails (or limits) load for economic dispatch (ES&M) Distribution operator curtails customer load for grid management Customer reduces demand in response to pricing event Multiple clients read demand and energy data automatically from customer premises Installation & Maintenance Field Services / System Recovery Energy Procurement DeliveryCustomer Interface Billing & Customer Service --- Distribution operator locates outage using AMI data and restores service Multiple clients use the AMI system to read data from devices at customer site Utility upgrades AMI system to address future requirements -- Customer provides distributed generation Customer uses pre-payment services Utility detects tampering or theft at customer site Utility maintains the AMI system over its entire life- cycle - Utility procures energy and settles wholesale transactions using data from the AMI system Distribution operators optimize network based on data collected by the AMI system Customer reads recent energy usage and cost at site Utility remotely limits or connects/ disconnects customer Utility installs, provision and configure the AMI system AMI system recovers after power outage, communications or equipment failure Real-time operations curtails (or limits) load for economic dispatch (ES&M) Distribution operator curtails customer load for grid management Customer reduces demand in response to pricing event Multiple clients read demand and energy data automatically from customer premises Installation & Maintenance Field Services / System Recovery Energy Procurement DeliveryCustomer Interface Billing & Customer Service Over 150 people across 18 cross-functional teams in 43 workshops representing most functional areas within SCE defined 80 potential uses for the AMI system

6. www.sce.com/ami © Copyright 2006, Southern California Edison 6 Vendor Engagement Goal: Competitive commercial products available from at least two meter and two communication vendors that meet SCE’s minimum requirements for performance and price by the end of Phase I

7. www.sce.com/ami © Copyright 2006, Southern California Edison 7 External Engagement Utility Consortium –Organizing international utility group within existing standards body UCA ® International Users Group, the parent organization for OpenAMI –Charter members represent over 75 million meters worldwide including: SDG&E - AEP - FPL PG&E- ConEd- NationalGrid EDF- TXU- LIPA DTE- HydroOne - Exelon AES - PacificCorp- BCHydro SCE Technology Advisory Board –Objective is to leverage existing reference design and standards efforts and industry insights for AMI program –Membership: Carnegie Mellon: Dr. R. TongiaAMI technology & policy + Asia & Europe insights CEC PEIR: D. WatsonCEC DR Research OpenAMI: R. BellAMI reference design effort Intelligrid: J. HughesUtility systems interoperability & security Gridwise Architecture: S. WidergrenSmart network reference architecture IEC: R. SchombergInternational standards + European insights Technology Research –Universities and national labs including UC Berkeley, Carnegie Mellon, Caltech, MIT, LBNL, PNNL, and Oak Ridge NL –Thought leaders from Intel, Microsoft, Cisco, McKinsey, IBM, Accenture, SAIC and Siemens

8. www.sce.com/ami © Copyright 2006, Southern California Edison 8 AMI Phase I Summary Schedule

9. www.sce.com/ami © Copyright 2006, Southern California Edison 9 Advanced Metering Market Technology & Utility Adoption

10. www.sce.com/ami © Copyright 2006, Southern California Edison 10 Advanced Metering Technology Roadmap Based on utility and vendor feedback

11. www.sce.com/ami © Copyright 2006, Southern California Edison 11 Electric Meter Technologies 2 nd Generation vs. 3 rd Generation difference in adoption of architecture based design Solid State Gen2 Solid State Gen3 Performance (Functional & Value) Time 20062008 SCE Technology Adoption Zone 20002010

12. www.sce.com/ami © Copyright 2006, Southern California Edison 12 Electric Residential Meter Communication Technologies AMR vs. AMI difference in adoption of architecture based design & true two-way communication AMR AMI Broadband Application for Utility AMI BPL Muni WiFi WiMax Performance (Functional & Value) Time Pervasive Customer Broadband Access 20062008 SCE Technology Adoption Zone 20002010

13. www.sce.com/ami © Copyright 2006, Southern California Edison 13 Meter Data Management Systems (MDMS) Enterprise Level (Interval Data) Commercial Applications Performance (Functional & Value) Time 20062008 SCE Technology Adoption Zone 20002010

14. www.sce.com/ami © Copyright 2006, Southern California Edison 14 Technology Capability Maturity (TCM) Metrology DimensionsCommunication Dimensions Disconnect Configurability & Programmability Serviceability & Diagnostics Power Quality Memory Reliability Interoperability Display Security Tamper / Theft Detection Architecture Flexibility Availability HAN Interoperability (Meters to Comm) Reliability Scalability Security Serviceability of the field element Serviceability / Maintainability Throughput (Daily) Throughput (on demand poll) WAN - NAN

15. www.sce.com/ami © Copyright 2006, Southern California Edison 15 Technology Capability Maturity (TCM) A.Customer reset B.Unlimited set points C.Commercially available & in use now (>1,000 units) D.Current limiting capabilities E.On/Off disconnect F.Voltage sensing G.200 Amp rating H.Integrated device (nearly same physical size) Disconnect 5.A-H 4.B, C, D, E, F, G, H 3. C, D, E, F, G, H 2. D, E, F, G, H 1. E, F, G, H 0. Collared Solution 11 Vendors’ Road Map & State of Technological Maturity SCE’s Business, System & Architecture Requirements

16. www.sce.com/ami © Copyright 2006, Southern California Edison 16 Programmable Disconnect Switch (example) Customer moves Emergency curtailment (supply constraints) Economic curtailment (high price) Staged restoration during interruption anomaly Prepayment services Credit & collection service limiting Customer side load sensing –Possible theft detection following switch opening –Possible customer owned generation following switch opening Contract demand Planned outage safety mechanism –Proactively activate switch in affected area to ensure no load side voltage Disconnect 5.A-H 4.B, C, D, E, F, G, H 3. C, D, E, F, G, H 2. D, E, F, G, H 1. E, F, G, H 0. Collared Solution11 Target AMI Phase I capability set Commercially available & deployed (>1,000 units), current limiting, voltage sensing, 200 Amp, integrated device