Company: SCE-PL
Filing Date: 2025-10-28
Form Type: 10-Q
Source: 0000827052-25-000100
Chunk: 92

Company: SOUTHERN CALIFORNIA EDISON Co
Filing Date: 2025-10-28
Form: 10-Q
Item: Item 7
Chunk 92
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 May 2025, SCE has objected, and as of September 30, 2025, discussions are ongoing between the parties.

SCE Dividends

As discussed in the 2024 Form 10-K, the CPUC regulates SCE's capital structure which limits the dividends it may pay to its shareholders. In the third quarter of 2023, the CPUC issued a decision on SCE's application to the CPUC for an extension of the waiver of compliance with its equity ratio requirement that allows SCE to exclude from its equity ratio calculations (i) net charges accrued in connection with the 2017/2018 Wildfire/Mudslide Events and (ii) debt issued for the purpose of paying claims related to the 2017/2018 Wildfire/Mudslide Events up to an amount equal to the net charges accrued in connection with the 2017/2018 Wildfire/Mudslide Events. Under the decision, effective as of the beginning of the cost of capital cycle on January 1, 2023, the CPUC also authorized SCE to exclude from its equity ratio calculations debt that exceeds the net charges accrued in connection with the 2017/2018 Wildfire/Mudslide Events due to the timing difference between the wildfire claims payment and the realization of the cash tax benefits.

In the first quarter of 2025, the CPUC approved the TKM Settlement Agreement, under which SCE is allowed to permanently exclude any after-tax charges to equity associated with the costs disallowed or funded by shareholders in the TKM Settlement Agreement, and the debt issued to finance these costs. In September 2025, SCE and various intervenors jointly filed a motion seeking approval of a settlement agreement related to the Woolsey Fire. This settlement agreement includes equity ratio calculation exclusions similar to those in the TKM Settlement Agreement. As the CPUC has not yet issued a final decision on cost recovery for the Woolsey Fire, SCE filed an application in August 2025 to extend the existing waiver of compliance with its equity ratio requirement. Under the CPUC's rules, SCE is not deemed to be in violation of the equity ratio requirement while the waiver application is pending resolution. 

For information on the California law requirements on the declaration of dividends, see "Notes to Consolidated Financial Statements—Note 1. Summary of Significant Accounting Policies—SCE Dividends" in the 2024 Form 10-K.

Margin and Collateral Deposits

Certain derivative instruments, power and energy procurement contracts, and other contractual arrangements contain