Edison International reported a core EPS (Earnings Per Share) for the first quarter of 2024 at $1.13.
Year-over-year quarterly variance analysis showed core earnings grew by $0.04, primarily due to higher CPUC (California Public Utilities Commission) revenue authorized in track 4 of the 2021 GRC (General Rate Case) and higher authorized rates of return.
This growth was partially offset by higher interest expense associated with debt for wildfire claims payments.
EIX Parents and Other were in line with the same period last year.
Future Guidance
Edison International affirms its 2024 core EPS guidance range of $4.70 to $5.05.
The company remains confident in delivering on its long-term EPS growth targets of 5% to 7% for the periods 2021 through 2025 and similarly for 2025 to 2028.
SCE (Southern California Edison) has planned investments about $5 billion over the past five years and expects to invest more than $6 billion in wildfire mitigation-related capital over the next five years.
SCE expects around 2% to 3% annual growth in electricity demand in the coming years, with an inflection point above 3% annual growth beginning in 2028, driven by the adoption of electric vehicles, industrial electrification, and building electrification.
SCE highlighted additional annual O&M (Operations and Maintenance) savings of $35 million to mitigate revenue increase.
Trends, Market Conditions, Sentiment
Wildfire Mitigation and Climate Change: Edison is leading in wildfire mitigation, sharing its expertise nationally as wildfires become a more common issue across the country. This includes the utility’s efforts in physical hardening of the grid to significantly reduce wildfire risks.
Regulatory Environment: The company continues to find the regulatory environment in California constructive, indicating continued support from regulatory bodies for utility investments in infrastructure and mitigation efforts.
Grid Hardening and Safety: SCE is nearing its goal of hardening 90% of its distribution lines in high fire risk areas by the end of 2025, a key factor in managing future losses from wildfires. This includes both overhead and underground hardening measures.
Electrification and Load Growth: Significant growth is expected from electric vehicle adoption and building electrification. With California leading in zero emission vehicle sales, SCE projects this will be a key driver of electricity demand.
Financial Health and Cost Management: Despite the additional investments and wildfire-related losses, SCE maintains focus on cost leadership, aiming for the lowest system average rate among major California IOUs. The discussions highlighted SCE’s robust plan for managing its debt and equity needs while continuing to invest in growth areas.
Notable Quotes
”We are pleased with our start to the year, and we are confident in affirming our 2024 core EPS guidance of $4.70 to $5.05.” - Pedro Pizarro, CEO
”We have shown that wildfire risk associated with utility infrastructure is manageable.” - Pedro Pizarro, CEO
”We continue to see constructive regulatory decisions.” - Pedro Pizarro, CEO
”On track to file the Woolsey cost recovery application in Q3.” - Maria Rigatti, EVP and CFO
”Our commitment to clean energy leadership and innovation is well recognized in the industry.” - Pedro Pizarro, CEO
