<PAGE>
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: September 7, 1994
Date of earliest event reported: September 6, 1994
SOUTHERN CALIFORNIA EDISON COMPANY
(Exact name of registrant as specified in its charter)
CALIFORNIA 1-2313 95-1240335
(State or other jurisdiction of (Commission (I.R.S. employer
incorporation or organization) file number) identification no.)
2244 Walnut Grove Avenue
(P.O. Box 800)
Rosemead, California 91770
(Address of principal executive offices, including zip code)
818-302-1212
(Registrant's telephone number, including area code)
<PAGE>
<PAGE>
Item 5. Other Events
On September 6, 1994, Southern California Edison Company
("Edison") issued a press release announcing the signing of a
memorandum of understanding with the California Public
Utilities Commission's ("CPUC") Division of Ratepayer
Advocates ("DRA") that will form the basis for negotiation of
a final settlement regarding Edison's 1995 General Rate Case
("GRC"). The memorandum of understanding provides for: (1) a
$67 million non-fuel revenue decrease in Edison's GRC, (2) an
accelerated eight-year recovery of Edison's $2.7 billion
remaining investment in San Onofre Nuclear Generating Station
Units 2 and 3 (SONGS 2 & 3) at a reduced rate of return, and
(3) an incentive pricing plan for electricity produced by
SONGS 2 & 3. Edison and the DRA will seek CPUC approval of
the proposed settlement by the end of 1994. Copies of the
press release and memorandum of understanding are filed
herewith as Exhibits 20.1 and 20.2 and are incorporated herein
by reference.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits
See Exhibit Index on page 4.
<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
SOUTHERN CALIFORNIA EDISON COMPANY
C. Alex Miller
----------------------------------
C. Alex Miller
Treasurer
September 7, 1994
<PAGE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
- - ------- -----------
20.1 Press Release Regarding General Rate Case
Memorandum of Understanding with DRA.
20.2 Memorandum of Understanding Between
Edison and DRA re 1995 General Rate Case.
EXHIBIT 20.1
EDISON REACHES UNDERSTANDING WITH CPUC ADVOCACY
ARM ON 1995 GENERAL RATE CASE
September 6, 1994 -- Southern California Edison Company has signed a
memorandum of understanding with the California Public Utilities
Commission's Division of Ratepayer Advocates (DRA) that will form the
basis for a final settlement regarding the utility's 1995 General Rate
Case (GRC). The memorandum of understanding contains these terms:
* A $67 million revenue non-fuel revenue decrease in Edison's 1995
GRC;
* Accelerated eight-year recovery of Edison's $2.7 billion remaining
investment in San Onofre Nuclear Generating Station Units 2 and 3 (SONGS
2 & 3) at a reduced rate of return; and
* An incentive pricing plan for electricity produced by SONGS 2 & 3.
"The concepts contained in the understanding serve the basic
interest of our customers and our shareholders," said John E. Bryson,
chairman and chief executive officer of Southern California Edison. For
customers, the understanding results in present-value savings and provides
certainty regarding future costs of operating SONGS 2 & 3.
For SCEcorp's shareholders, the understanding calls for the
accelerated recovery of Edison's nuclear investment and clear incentives
for continued operation of SONGS. "The understanding also is consistent
with the direction the CPUC is taking on regulation of the state's
electric utilities," Bryson said.
Under the terms of the understanding, Edison's 1995 non-fuel
revenues would decrease by $67 million from the 1994 level. In its
original GRC filing, Edison requested a revenue increase of $117 million.
Subsequently, Edison reduced its request to $70 million because of revised
cost estimates and sales and customer growth forecasts. DRA had proposed
a $151 million reduction for 1995.
"While the understanding will set revenues below our request, we
believe it provides sufficient funding for us to continue delivering high-
quality service to our customers and to earn our authorized return -- but
only if we manage effectively," Bryson said.
The understanding provides for spending reductions in research and
development and traditional demand side management (DSM) energy
conservation programs.
However, the understanding does not alter Edison's commitment to
invest $75 million in shareholder funds in ENvestSCE, which provides
energy efficiency solutions for large customers.
The memorandum of understanding includes the accelerated recovery of
Edison's $2.7 billion remaining investment in SONGS 2 & 3 over an eight-
year period beginning February 1, 1996. During this period, Edison would
earn a return of 7.78 percent on its investment in SONGS 2 & 3. Edison's
current authorized rate of return is 9.17 percent.
While providing for Edison's recovery of its investment in SONGS 2
and 3, the memorandum also establishes an incentive pricing plan for
continued operation of SONGS 2 & 3. Under the plan, Edison customers
would pay about four cents for every kilowatt-hour of electricity produced
by SONGS 2 & 3 during the eight-year period. This pricing plan will
replace traditional ratemaking treatment for Edison's ongoing operating
and capital expenses for SONGS 2 & 3. The incentive pricing plan does not
affect existing rate recovery for the decommissioning of SONGS 2 & 3 or
for Edison's investment in Palo Verde Nuclear Generating Station.
<PAGE>
<PAGE>
Edison's board of directors has approved going forward with the
proposed settlement based upon the terms of the memorandum of
understanding. Edison and the DRA are working to complete a definitive
settlement agreement, and they will hold a settlement conference in the
near future to explain the settlement terms. Edison and the DRA will seek
Commission approval of the proposed settlement by the end of 1994. The
Commission can accept, modify, or reject Edison and DRA's proposal.
EXHIBIT 20.2
Memorandum of Understanding Between Edison and DRA
Re 1995 General Rate Case
This MOU is not a settlement agreement or stipulation between Edison and
DRA, but forms the basis for a future settlement or stipulation. This MOU
is subject to approval by Edison's Board of Directors. Edison and DRA
agree not to publicly disclose the terms of this MOU until approved by
Edison's Board. Edison and DRA will conduct these negotiations in
confidence pursuant to Rule 51.9 of the Commission's Rules of Practice and
Procedure. Edison and DRA will make all reasonable efforts to negotiate
the settlement or stipulation in time for rates to be effective 1/1/95.
1. Edison will accelerate the recovery of its share of SONGS 2 & 3 sunk
costs commencing on 2/1/96 and terminating on 12/31/03 ("8-Year
Period").
2. The sunk costs Edison will recover is a SONGS 2 & 3 rate base amount
of $2,749 million less the accumulated deferred taxes of $562
million. 1
3. During the 8-Year Period, Edison will earn a return on SONGS 2 & 3
sunk costs equivalent to 7.78% on rate base.
4. Edison will remove the revenue requirement in rates as of 1/31/96
for items identified as SONGS 2 & 3 sunk costs. Starting 2/1/96,
the SONGS 2 & 3 sunk costs shall be placed in rates and recovered
over 8 years.
5. DRA and Edison shall negotiate terms and conditions in the final
settlement document consistent with those in the SONGS 1 model to
address the permanent closure of SONGS 2 and/or 3.
6. From 2/1/96 through 12/31/03, Edison must accept on behalf of its
customers all of its share of SONGS 2 & 3 output. The following
Incremental Cost Incentive Pricing ("ICIP"), by year, subject to
verification is:
For: 1996 - 3.80 cents/kWh 2000 - 4.05 cents/kWh
1997 - 3.85 cents/kWh 2001 - 4.10 cents/kWh
1998 - 4.00 cents/kWh 2002 - 4.15 cents/kWh
1999 - 4.00 cents/kWh 2003 - 4.15 cents/kWh
____________________
1 The amount to be amortized will consist of Edison's SONGS 2 & 3 sunk
costs recorded as of 1/1/96 and will include amounts for Marine
Mitigation costs - $41 million; Design Basis Documentation - $31
million; COD Adjustment - $17 million; and MS Inventory - $52
million.
<PAGE>
<PAGE>
7. Subsequent to 12/31/03, Edison may sell power generated by SONGS 2
and 3 to any customer.
8. Subsequent to 2/1/96, there will be no apparent need for SONGS 2 or
3 reasonableness reviews. Edison retains the option to produce
power at any level or permanently close either SONGS 2 and/or 3 at
any time.
9. The Nuclear Unit Incentive Procedure for SONGS 2 & 3 shall terminate
at the completion of Fuel Cycle 7 operations.
10. Edison will continue traditional cost-of-service rate recovery of
SONGS 2 & 3 decommissioning expenses, unamortized loss on reacquired
debt, and DOE decommissioning expense from EPAct 1992. Edison may
also seek recovery of assessments, retrospective premiums or other
costs associated with worker or third party claims.
11. Edison's 1995 base rate revenue requirement2 will be reduced by $67
million from the currently estimated 12/31/94 authorized level of
$3,932 million, resulting in an ALBRR of $3,865 million. This will
include funding DSM programs and activities at $65 million, of which
$14 million will be transferred to Customer Service O&M expense.
RD&D programs and activities will be funded at $28 million.
12. If a PBR mechanism is effective by 1/1/96, attrition will not be
required.
By: Bruce C. Foster 9/2/94 By: James D. Pretti 9/2/94
Southern California Edison Division of Ratepayer
Company Advocates
- - --------------------
2 Nominal dollars.
