Edison International Inc. executives have outlined a capital spending plan for 2023 through 2028 of $38 billion to $43 billion, a range notably higher than its 2021-2025 window and which includes funds for infrastructure replacement work that has been de-emphasized in recent years as the company focused on wildfire mitigation investments.
Pedro Pizarro, president and CEO of Edison International, and his team say the increase in planned investments, sketched out as part of their 2025 General Rate Increase application, stem from several structural changes facing the parent of Southern California Edison. Those include growing climate risks and an acceleration in the rate of electrification—in the shape of electric vehicles, heat pumps and other factors—among the utility’s customers. To meet the demand growth those challenges are creating and to catch up work set aside of late in favor wildfire mitigation, Pizarro is looking to bump direct capital expenditures to about $800 million in 2025—the company calls that “historical levels of proactive replacement”—from an average of about $200 million since 2021.
SCE’s spending on wildfire mitigation has grown from about $700 million in 2019 to about $1.2 billion in both 2021 and 2022, driven by work on covered conductors. Over the past three years, the company has installed nearly 4,000 miles of covered conductors and Pizarro earlier this month told analysts his team is aiming to have replaced more than 7,200 miles of overhead lines, about three-fourths of the company’s total network, by late 2025.
At that point, the Edison International team plans to shift the focus of its mitigation investments to undergrounding projects in higher-risk areas. Projections call for the undergrounding of just 11 miles this year and 20 miles in 2024 before growing to 60 in 2025 and 150, 200 and 170 in the three years following. That timeline jives with the approach SCE CEO Steve Powell laid out early last year.
Infrastructure replacement accounts for 29% of the projected roughly $40 billion in capex from 2023 through 2028. Inspections and maintenance work is slated to be 13% of the total and other distribution projects are estimated to be about 11% of all spending. In all, roughly 85% of Edison International’s capex for the five-year window is being allotted in some way to distribution. The company’s proposed schedule for the California Public Utilities Commission to host hearings and come to a decision pencils in a final call in December of next year.
