Edison International

and Executive Vice President and Chief Financial Officer Maria Rigotti. Also on the call are other members of the management team. Materials supporting today's call are available at www.edisoninvestor.com. These include a form 10-Q, prepared remarks from Pedro and Maria, and the teleconference presentation. Tomorrow, we will distribute our regular business update presentation. During this call, we will make forward-looking statements about the outlook for Edison International and its subsidiaries. Actual results could differ materially from current expectations. Important factors that could cause different results are set forth in our SEC filings. Please read these carefully. The presentation includes certain outlook assumptions as well as reconciliation of non-GAAP measures to the nearest GAAP measure. During the question and answer session, please limit yourself to one question and one follow-up. I will now turn the call over to Pedro.

Well, thank you, Sam, and good afternoon, everyone. Just three months have passed since the devastating wildfires, and all of us at Edison continue to keep everyone affected in our thoughts. We're working closely with state and county leaders and the communities of Altadena and Malibu to rebuild wildfire-impacted areas stronger than ever. I will share further updates in a minute after touching on our earnings headlines. Today, Edison International reported core earnings per share of $1.37 compared to $1.13 a year ago. However, this year-over-year comparison is not particularly meaningful because SCE has not received a decision in its 2025 general rate case. SCE recognized revenue from CPUC activities for both the first quarter of 2024 and 2025, largely based on 2024 authorized base revenue requirements, with 2025 adjusted for the lower authorized EPUC ROE. Looking ahead, we remain confident in our ability to meet our 2025 EPS guidance and deliver a 5% to 7% core EPS CAGR to 2028. Maria will discuss her financial performance in her remarks. We recently provided Governor Newsom with SCE's initial comprehensive plan to rebuild the impacted electrical distribution infrastructure in the Palisades and Ethan fire areas. Under this plan, SCE would underground more than 150 circuit miles, including nearly all distribution power lines in high-fire risk areas within the burn scars of the affected communities. Once constructed, this grid hardening will increase reliability and make electrical distribution infrastructure more resilient to high wind and other extreme weather events, helping us better protect and serve our communities. On the Eaton Fire, SCE's investigation continues. Since our last update, the utility completed additional physical and video inspections of electrical equipment in Eaton Canyon, which were carried out in collaboration with stakeholders. Analysis of the images, videos, and equipment is ongoing. The utility also recently began the removal of portions of the idle facilities in Eaton Canyon for further expert review. While FCE has not conclusively determined that its equipment was associated with the ignition of the Eaton fire, it is also not aware of evidence conclusively pointing to another source of ignition. Absent additional evidence, SCE believes that its equipment could have been associated with the ignition of the Ethan Fire. As such, and in light of pending litigation, it is probable that EIX and SCE will incur material losses in connection with the Ethan Fire. As always, we are committed to being transparent throughout this process. With significant media coverage surrounding the Ethan Fire, We have noted numerous instances where facts have been misrepresented. To address factual errors and misstatements, we launched a new page on our website called Edison for the Record. I encourage you to take a look and a link can be found on page three. I will reiterate that we continue to believe that FCE is a reasonable operator of its electric system. if it is determined that SCE's transmission equipment was associated with the ignition of the Eaton fire. Based on the information we have reviewed thus far, we remain confident that SCE would make a good faith showing that its conduct with respect to its transmission facilities in the Eaton Canyon area was consistent with actions of a reasonable utility. Turning to the legislative front, we have continued to engage in broad discussions with legislators, and the governor's office to support the safety of our communities and enhance California's industry-leading AB 1054 regulatory framework. The conversations we've had leave us with no doubt that stakeholders understand the criticality of addressing the issue and the important role the investor-owned utilities play in supporting California's growth and economic development. We are confident policymakers are focused on the need to strengthen and restore confidence in California's wildfire framework. On the regulatory front, I'm pleased to share that SCE continues to reach important milestones this year. The CPUC's unanimous approval of the TKM settlement agreement signals a constructive California regulatory environment. Last month, the Woolsey Cost Recovery ALJ issued the scoping memo adopting the schedule SCE and intervenors jointly proposed. The next major filings will be intervenor testimony in early June and rebuttal testimony in mid-July. The schedule also includes a motion for consideration of a settlement agreement or joint statement of stipulations of issues due in mid-August. As we have noted in the past, SCE is open to settlement discussions if a fair and reasonable outcome can be achieved, benefiting customers and shareholders. We will keep you updated as the utility continues its progress toward resolution in this proceeding. Maria will highlight other milestones in her remarks. On SCE's 2025 general rate case, the ALJ recently made an administrative ruling extending the statutory deadline, which is typical and expected based on the prior calendar. Nonetheless, We continue to be optimistic that we will see a proposed decision in the first half of the year with the final decision as soon as 30 days later. The GRC will support SCE's commitment to providing electric service that is reliable, resilient, and ready for customers' needs. The utility's significant investment plan is driven by the need to resume a traditional level of infrastructure replacement work necessary for system reliability. and continue its wildfire mitigation programs that protect the safety of customers and the public. SCE's full GRC request also includes about $1.4 billion of annual capital spending on wildfire mitigation and includes hardening an additional 1,800 miles of the utility's overhead distribution infrastructure. SCE will submit its 2026 Wildfire Mitigation Plan in May. This comprehensive WMP reflects our collective priorities, risk mitigation, public safety, and affordability. It also includes continued deployment of covered conductor and targeted undergrounding. The utility looks forward to executing its integrated wildfire mitigation strategy, which prioritizes industry-leading practices such as grid hardening, asset inspections, and vegetation management. Before I turn it over to Maria, I would like to take a moment to say a big, big thanks to a few very special members of our team. Last week, Vanessa Chang retired from our board of directors. And we congratulate Vanessa on her retirement and are so thankful for her 18 years of dedicated service and leadership on the board. I also want to recognize our former general counsel, Adam Yumanof, who we previously announced will be retiring in July. Adam has, simply put, been the ideal general counsel. He is a business leader above all, who is also a consonant legal expert. On top of that, Adam has been a steadfast friend to many in our organization, and absolutely, he's been that to me. On behalf of our board and management team, we want to thank Adam for his outstanding service. At the same time, I am delighted to welcome Sean Dunwamu, who joined us earlier this month as our new general counsel. Shonda brings substantial expertise within our sector and a solid understanding of California's legal, political, and regulatory environments. We're excited to have Shonda here and look forward to her leadership and partnership. All right, Maria, with that, turn it over to you for the financial report.

Thanks, Pedro. And I echo the appreciation for Adam and Vanessa and welcome Shonda. Now, my comments today will cover first quarter 2025 results, provide additional insight into key regulatory proceedings, and update you on other financial topics. Starting with the first quarter, EIX reported core EPS of $1.37. Page 4 provides the year-over-year quarterly variance analysis. As Pedro mentioned, the year-over-year comparison is not particularly meaningful because SDE has not received a final decision in its 2025 general rate case. SCE is booking revenues at 2024 authorized levels adjusted for the change in ROE and will record a true-up when it receives a final decision. First quarter EPS includes about 30 cents associated with the TKM settlement approval, partially offset by higher interest expense at EIX, parent, and other. On the regulatory front, I want to echo Pedro's comment on SCE making significant progress across numerous proceedings. Let me highlight a few. First, SCE recently reached a settlement agreement with interveners in its WMCE proceeding related to wildfire mitigation and restoration. The settlement, which is awaiting CPUC approval, would authorize 100% of the capital expenditures along with 96% of the O&M. It would also contribute about $0.10 per share of true-up earnings and about $700 million of rate base, both of which are embedded in our 2025 guidance. Second, on SCE's 2026 cost of capital application, summarized on page five, SCE requested an ROE of 11.75% and proposed updating the embedded costs of debt and preferred equity. The request also recommends the continuation of the cost of capital mechanism and to reset the benchmark. The utility made a strong case for its ROE based on risks that differentiate California utilities from their peers in other jurisdictions. SCE's proposed schedule calls for a PD in November, which would allow for a final decision by year-end. Historically, the CPUC has issued timely decisions on cost of capital applications. Third, SCE filed its NextGen ERP application with the CPUC, seeking total capital investment of about $1.1 billion. The utility expects this program will provide substantial benefits to customers and enable business improvements. As a reminder, this program is not currently embedded in our capital and rate-based projections. Lastly, with the $1.6 billion TKM cost recovery settlement now approved, within the next few weeks, SCE will file an application requesting authorization to issue securitized bonds. Moving to SCE's GRC, the utilities request provides the foundation for advancing critical customer objectives, reliability, resiliency, and readiness. as well as supporting our growth outlook through 2028. As you can see on page six, we will refresh our guidance following a GRC final decision. We wanted to be proactive in sharing with you that six weeks after a final decision, we will provide our updated capital and rate-based projections, 2025 core EPS range, long-term core EPS growth, and financing plans. Turning to SCE's capital expenditure and rate-based forecasts, shown on pages seven and eight, The utility continues to execute against a capital plan that targets key programs while maintaining flexibility in later years to adapt to what is ultimately authorized in the GRC. As I highlighted in comments going into 2025, we continue to see substantial additional capital opportunities that are incremental to the plan. This includes investments to enhance our distribution system and more than $2 billion of FERC transmission spending. In addition, SCE plans to file an application for its advanced metering infrastructure program to request funding to replace its smart meter fleet, the majority of which were installed more than a decade ago. This program will address technology obsolescence and offers a chance to incorporate future capabilities that benefit customers. The program is expected to provide insights into energy usage and enable smarter energy management, thereby enhancing grid efficiency. Turning to the financing activities, I will highlight two recent transactions. In March, EIX issued $550 million of senior notes, which successfully addresses our parent debt needs for 2025. Additionally, SCE issued $1.5 billion of long-term debt as part of its planned financings for the year. Both of these offerings saw strong investor support and were significantly oversubscribed. Moving to EPS guidance on pages 9 and 10, We are confident in affirming the 2025 range of $5.94 to $6.34 and reaffirming our long-term EPS growth expectations of 5% to 7% from 2025 to 2028, which translates to $6.74 to $7.14 of 2028 EPS. Let me conclude by reinforcing our confidence in delivering on our financial targets. With a strong regulatory backdrop and robust rate-based growth, coupled with a significant need for incremental grid investment, we are well positioned to deliver on the company's near and long-term growth expectations. That concludes my remarks, and back to you, Sam.

Michelle, please open the call for questions. As a reminder, we request you to limit yourself to one question and one follow-up, so everyone in line has the opportunity to ask questions.

Thank you. If you would like to ask a question, please press star one on your phone. One moment for the first question, please. Nicholas Campanella with Barclays. You may go ahead, sir.

Hey, thanks for taking my questions and for all the disclosures today. Hey, so I just, you know, I appreciate the new material loss disclosure that you mentioned. And I guess just what drove you to kind of put that out there now versus, you know, in the fourth quarter? update and then I guess just now that you're in this situation or now that you've had kind of more time to digest the situation, you know, how do you kind of see the potential liability stacking up versus the $21 billion fund that you also kind of talk about in the disclosure? Thanks. Okay.

Thanks, Nick, for the question and also for the comments. You know, as you can imagine, this is an ongoing process, right? We are only three months here since the start of the fire. the community is still recovering and will be for quite a long time. And as I mentioned in my prepared remarks, the investigation continues. And so, as I mentioned in my comments, I think one of the key factors here is that while we have not yet concluded that our equipment started the fire, it was a cause of ignition, there's certainly a number of pieces of circumstantial facts, but importantly, we also are not finding another likely hypothesis for the cause of the fire. So I think it's really when you combine those two elements, it felt appropriate to, in this order, make the disclosure about this being a probable event. In terms of liability, again, it's still very early days here. The liability is simply not estimable today, and I'm not sure when it may become estimable. That could take quite some time, too. You know, there's a number of third parties out there in the public who have come up with estimates of various pieces of this. Those seem to suggest that, you know, perhaps the fire might be somewhere in the range of the fund, but I think it's just certainly too early for us to be able to make any sort of estimate around the size of the liability and therefore can't answer your question for it. Maria or anybody else, anything you would add?

No, I think you covered it, Pedro.

Thanks, Maria.

Certainly appreciate the moving factors and appreciate that color there. And then just in regards to the financing plan refresh six weeks after the GRC decision, can you just remind us or kind of give us color on how you're thinking about how you would reflect any liabilities from the Eaton Fire? Would that go into the financing considerations at that point?

Yeah, Nick, that's a great question. It's Maria. So when you think about the potential and the probable losses that Pedro talked about. Remember that now at this point in time, unlike when we were dealing with TCAM and Woolsey, we have the wildfire fund that we will be accessing. So when it comes to it, we'll take our first billion dollars of customer-funded self-insurance, we would be paying claims from that initially, and then we would access the fund. And the benefit of that is that we will not need to be issuing debt in order to pay claims as we did for TCAM and Woolsey, there'll be another avenue for that. And that not only benefits sort of the financing plan, but obviously that's there as a protection for the community that suffered the loss. So when we do our financing plan, we will be just basing it on sort of the normal course things that we'll be looking at, which is our capital plan, et cetera. So that is how we will be refreshing the plan, and that's what we'll be communicating once we get the GRC final decision.

Thanks for taking the question. Appreciate it. Thanks, Nick.

Thank you. Our next caller is Michael Lungan with Evercore ISI. You may go ahead, sir.

Michael Lungan Hi. Thanks for taking my question. I'm just wondering if you could share more color about the latest options being considered for updated wildfire legislation in California. And what should be confidence the legislation will give investors more certainty, you know, about effective financial backstop in the state? And then also, are you confident the legislation will get passed this session ending in September?

Yeah, thanks. Your phone line was just a little shaky, but I think I got the bulk of that. You were asking about the prospects for legislation and, you know, what drives level of confidence. So, as I mentioned in my remarks, Mike, the good news here is that clearly, you know, the governor's office is engaged as our legislative leaders. You know, they're getting their arms around what is, you know, admittedly a very complex issue. but they are on the case and we are having discussions as folks are looking for information. But again, it's very early days here in terms of those discussions. I think what gives me confidence is that, let me put it this way, we are confident that they understand the need for expansion of the AB 1054 framework and the need for action. Beyond that, though, while I think that I'm sensing a lot of good intent around action in this session, we need to let this play out and continue to engage constructively on our side. There's never any guarantees in anything like this, but I'm certainly very encouraged by the level of diligence and engagement that I'm seeing on the part of key leaders across the legislature and the governor's office.

Thank you. And then, you know, I think last disclosure on your Moody's risk management model, you said you had reduced the probability of catastrophic wildfire by 88%. You know, obviously, wildfire mitigation has been focused on distribution assets, and this one could potentially have been on transmission. Just wondering, have you had discussions with Moody's, you know, about updating that probability? And if so, where do you stand now?

Well, I might say it a little differently for starters, and I asked Steve Powell to weigh in here as well. But the Moody's RMS model is really a comprehensive model that looks across our various risk areas. For us, historically, distribution had led to ignitions. We hadn't seen them, you know, from the transmission side. But the model is comprehensive, and we always knew that, unfortunately, the risk would never be zero. But, Steve, is there any added color you would add here for Mike?

I'd just say that, you know, the grid hardening that we've done, as well as all the other mitigations we've deployed, really are the driver of that risk reduction. And so that, you know, from the modeling perspective, that doesn't really change. I'll say we'll continue to evaluate other models. I know RMS will, you know, mature their models. And we look at other models as well to see if there's more to learn about wildfire risk and how that's evolving and can be modeled. to continue to evaluate that risk reduction. But the fact is that the work that we've done in the system has lowered the risk of ignitions and, frankly, of catastrophic wildfires being associated with our equipment, both on the distribution and the transmission system. So that's all incorporated into that analysis. And so we'll continue to focus on reducing the risk further, but also paying attention to the tail risk that exists.

Great. Thanks for taking my question. Yeah, thanks, Mike.

Thank you. Our next caller is Carly Davenport with Goldman Sachs. You may go ahead.

Hey, thanks so much for taking the questions. Maybe just to follow up on the last one there, just as you continue to investigate Eaton with the potential of the idled facilities to have been involved, can you just talk a bit about your wildfire mitigation plans related to any other idled or abandoned lines that could potentially pose risk going forward for

Yeah, so at a high level, I think you've heard this comment before, when we maintain idle lines and we don't take them down, it's because we believe that the utility may have future use, so they are inspected, they are maintained. Certainly as we look at this latest experience, but also every year as we update the wildfire mitigation plans, we look at are there any further learnings that we can bring to bear to continue to make the system stronger. We have disclosed, for example, that coming out of the recent experience, we realized you could bring some added clarity to, for example, the transmission operations manual in terms of the detail around how you ground idle lines. And those are always very case-by-case basis, but Steve's team added more specificity there's more clarity to how grounding is done out in the field. That's one example of the continuous improvement cycle that we go through, not only for this, but really for all aspects of operations.

Got it. That's really helpful. Thank you. And then maybe just as you think about the current capital plan, can you talk a little bit about if you've done any work quantifying exposure to tariff risk and how you might be working to mitigate that?

Yeah, Carly, I mean, obviously, I think like most other companies in the U.S., we've been thinking about that. And as we look at it and step back, really about about 5% of our total purchases are foreign materials. So it's a relatively, relative to our whole program, it's a relatively small number. If you translate that into dollars, it's probably about, you know, $125 million on an annualized basis. Now, we're going to continue to monitor that. We're going to continue to look for any kind of secondary impacts that might occur, but we're in that zone. And the customer impact will be mitigated to some extent because all of that is really related to capital, and the capital will enter rates and recovery of that capital enters rates over a very long, useful life for most of our assets. So that's where we are right now in terms of the tariff evaluation.

Great. Thank you so much for the time and the color. Thank you, Carly.

Thank you. Our next caller is Char Peruzza with Guggenheim. You may go ahead.

Hi, Char. Good afternoon, team. It's actually Constantine here for Char. Good afternoon. Thanks for taking the questions. Just starting off maybe on the shifting deadline for the SCE rate case, do you anticipate any offsets in lieu of new rates for the first half of the year? And is there enough visibility to continue executing on CapEx or would there be a little bit more focus on critical versus discretionary as you get that clarity.

Yeah, so, May, I'll take the second part of your question first in terms of the capital plan. Because the general rate case is a four-year cycle, we can execute against our plan and continue on with our priorities. And once we get the general rate case final decision, we can always adjust what the spend is in the back end over the next three years and three and a half years beyond the decision. So I think that's how we're thinking about the capital plan. In terms of offsets and rates and the like, obviously we're charging folks, and rates include right now the 2024 revenue requirement adjusted for the ROE. As we get into the final decision, any changes to the revenue requirement will be amortized into the bills over time. So I think we have a handle on the rates, and I think maybe just pointing back to you know, where we think our rates are going on a longer-term trajectory. I think you've seen the analysis that we've done that looks at, you know, the general rate case, you know, 100% of that request. It looks at additional capital that we might deploy. It looks at, you know, recovery on TKM and Woolsey. And even with those other pieces added into the rate trajectory, we see our rates growing, again, back in line with local inflation.

Excellent. Thanks for that. And as you're working on the incremental CapEx items, like the ERP and AMI, among the other items, transmission, how should investors think about financing alternatives on the incremental CapEx, just in terms of maintaining capital efficiency and their potential need for any capital structure waivers or any of that sort?

Yeah. So we typically at SCE finance capital in line with its authorized capital structure. I don't think you would really see a need for any capital waivers. That came about during the TCAM and Woolsey process, but the capital plan is very different than that. As we think about just more generally the financing plan, we've run a lot of scenarios. I think you've seen our financing plan right now through 2028, very minimal equity, largely debt financed between the parent and the utility. As we get the final GRC decision, we can rerun all of those numbers. But again, I think we have a lot of capacity to fulfill our capital needs.

Okay, excellent. Thanks for that. I appreciate taking the questions.

Thank you. Thank you. Our next caller is Paul Zimbardo with Jefferies. You may go ahead, sir.

Hi, good afternoon. Thank you, team. Following up on Nick's question a little bit on the Eaton disclosures around a potential material loss, Just does that indicate like you think there could be a reimbursement back to the wildfire fund or just is there any kind of signal around that? Because if it's contained within the fund, I would think there wouldn't be a material loss if you were found to be prudent. So if you could just help unpack that disclosure a little bit, it would be helpful.

Absolutely. Sorry, maybe I'll just go through how you account for it. You have to actually think about the two pieces separately. You think about the loss or the liability, and you disclose information around that. And then you think about the recovery of that. So we would record, you know, sort of receivables from insurance or the normal course insurance. And then as we go through, we will also record receivables from the wildfire fund. So it's not trying to be a signal as to positioning around what we think In terms of prudency, I think that, or refunding the fund, I think you've heard us say before that based on everything we know today and the information that we've reviewed, we believe that SCE will make a good faith showing that it was prudent. But from an accounting perspective, you kind of show the piece parts, not a net number.

Yeah, and Maria, that's what I wanted, I wanted to start there because the signal we're giving you is what Maria just said, that based on what we know today, we believe SCE was a reasonable operator of the system. All right. The shift to probable just indicates that, you know, we do see a material loss as probable now because of the, you know, absence of another likely cause having come to light so far. But, you know, we view this as, you know, if a fire ultimately, if we conclude that it is an Edison-related fire, then we have access to the fund. And in terms of prudency, you know, we believe that SEA will be able to make that good faith showing of reasonableness. So I just want to show crystal clear on that.

Yes, no, thank you for clearing that up. I appreciate it.

I appreciate you asking the question. Thank you.

Yes, no, thank you. And then the other, I know you said things are going to take a long time to play out to get more clarity, and you did mention, like, litigation strategies and the The Q, is there any time when, based on other events, you think about, like, approaching settlement conversations with parties?

Yeah, you will have heard this answer from us regarding fires. They're all case-by-case, right? Specific facts and circumstances of each fire, Paul. So it's really difficult to extrapolate any timing for this one based on other experiences. One timing item we've pointed to is that when it comes to the core formal investigation materials coming out of the fire authorities, those can take 12 to 18 months, right? That seems to be a broad timeline that we've seen elsewhere. But, you know, beyond that, timing towards, you know, making decisions about engaging with plaintiffs and settlements, et cetera, that's all very difficult to handicap at this point.

Okay. Understood. Thank you very much, team.

Thanks, Paul.

Thank you. Our next caller is Richard Sunderland with JPMorgan. You may go ahead, sir.

All right. Hey, good afternoon. Can you hear me?

Yeah, I can hear you great.

Great, thank you. Just following up on the last one there, it sounds like this hasn't changed, but do you have any revised timing expectations on the investigation just as your own progresses here?

No, we haven't been able to provide an estimate, and we still can't provide an estimate.

Understood. And then I know we've unpacked the material losses disclosure a bit, but just have you ruled out any third-party potential sources of ignition at this point? I mean, I know you said you haven't ruled out your own equipment, and there's still some others out there, but just trying to understand if that – that impacted the language coming this quarter?

I guess I'd refer back to the way I said it in my prepared remarks. At this point, we are not aware of any evidence that conclusively points to another source of ignition. Obviously, if someone has information, we would be very interested in hearing it or seeing it. But based on where we are today, in the absence of evidence pointing conclusively to something else, that was one of the factors in changing our designation to probable.

Understood. Thank you for the time.

Yeah, thanks, Rich.

Thank you. Our next caller is Greg Orrell with UBS. You may go ahead, sir.

Hi, Greg.

Yeah, hey. Good afternoon. Just regarding the the expectation of losses disclosure again. Is there anything about the nature of the type of the lawsuit that would make it unrecoverable by the wildfire fund that you're seeing, whether it's not economic damage or something else?

No. Greg, this is Maria. The wildfire fund is available to pay damage claims, so period, full stop. We have a safety certificate, so we also have the benefit of the liability cap, so there's nothing in the way we provided disclosure or any of that that would preclude us from accessing the fund. And there's no limitation on those types of claims that are paid by the fund, which might be more directly your question.

Okay. Just, thank you, one other, just on the interest expense driver for the quarter. Is it possible to break that up into, you know, TKM, you know, one time and then ongoing and anything else?

Yeah, so the interest expense driver, I think you're looking at the materials that we posted There's about $0.30 that's related to the prior period true-up for TKM. The $0.14, which is an annualized benefit on a go-forward basis, you'll start to see that now as we get into the second quarter, and we have now closed out the prior period.

Okay. Thank you. That's it. That's correct.

Thank you. Our next caller is Anthony Crowdell with Mizuho. You may go ahead, sir.

Good afternoon, team. Just, I guess, on the legislative efforts going on in Sacramento, I'm just wondering if, you know, I think in a rate proceeding, you guys may meet with parties before just to talk about plans and everything else. Any of the, just wondering if you'd share with us any type of, you know, when you're meeting with policymakers, is there any, you know, ideas on the solutions of modifying AB 1054 that you believe are maybe resonating with the policymakers, whether that's a repunishment mechanism or a bigger fund or Anything to that that you could share?

Yeah, not really, Anthony. Again, it's pretty early days right now. I think a lot of the legislators are still getting their arms around this and recognize that a lot of our legislators are newer to Sacramento from post the 2019 period. So, you know, there are ideas that various people are mentioning, but I think it'd be premature to get into the sort of details right now. From our end, we're just very committed to remaining engaged, to helping educate, and to making sure that policymakers understand the implications here. This is ultimately about how do we maintain safety for our communities and do it at the lowest possible cost to customers. And so we're making sure that, for example, people understand the impacts that action from the shareholder side can have on cost of debt, on credit ratings, and therefore impact to customer cost. So I think it's still in that early phase of getting arms around the topic.

Great. Thanks for taking my question.

You bet. Thanks, Anthony.

Thank you. Our next caller is David Arcaro with JPMorgan Stanley. You may go ahead, sir.

Hi, David.

Hey. Thanks so much for taking the question. Let's see, a quick question on the losses, the probable losses that you may recognize. Would that be, would there be any considerations from like a balance sheet perspective from either the CPC or credit rating agencies when that impacts the financial statements?

Yes, so David, the way it would be recorded is we would have the loss, again, so that's one piece of the puzzle, but we would also have offsetting receivables or regulatory assets, if you will. So there'll be a balance on the balance sheet. So it wouldn't have an earnings impact and you'd be grossing up the balance sheet, but it would be offsetting on each side. So from a regulatory capital perspective, um, as well as from sort of a rating agency perspective, we've got the basis covered.

Yeah. Gotcha. Okay. Understood. And you made it pretty clear that it's not a cash, um, cash flow impact just based on the access to the fund. And let me see, Pedro, I just also wanted to clarify something. Did you mention that are you seeing third party estimates of potential damages that suggested that the entire fund or something close to the size of the current fund could potentially be used or potentially representing the liability at that level?

Yeah, not quite what I indicated was, maybe a little more detail. As I read the paper, as you read the papers, right, you know, every now and then in an article, you'll see estimates by this expert or that expert or that entity. And I'm not sure that those are all comprehensive. I think sometimes, as I recall, they might talk about insured losses or they might talk about some other kind of loss. I don't recall seeing any one of those elements. add up to $21 billion yet. But again, because they're parts and piece parts, kind of hard to tell from that. So, you know, certainly it is a large fire. And if it ends up being linked to Edison infrastructure, then, you know, it could certainly consume, you know, a good quantum of the fund. But at this point, we can't estimate. So, you know, it's unclear whether it would consume X percent or even, you know, extinguish the fund. So it's just, again, too soon to tell. But a number of those estimates seem to have, for whatever they're estimating, they seem to, you know, be within the envelope of it. Again, just you'd have to peel the onion back on what they're looking at and how they're looking at and what's the qualities of those estimates. So I just wanted to acknowledge that you may be reading the same papers that we are and seeing numbers pop up here and there.

Yeah, gotcha. Okay, absolutely. That makes sense. Yeah, appreciate the caller. Thanks so much.

Yeah, thanks.

Thank you. Our next caller is Ryan Levine with Citi. You may go ahead.

Hi, everybody. Hi. Have there been any changes to the wildfire mitigation plan preparation work or approach to forming the updated plan post the January events?

Let me turn it over to Steve. As I mentioned earlier, this is something that every year the team looks at. What else are we learning? What else should we be looking at? Steve, let me turn it over to you.

Pedro, you hit the top line message, which is the plan is always evolving around the edges. The core of it remains we've got to continue to execute on our grid hardening programs. That means doing the cover conductor and the undergrounding. As Pedro mentioned, as we look at the areas, at least within the burn scars, we certainly are doing more undergrounding there than was originally planned, just based on the devastation that is there, the need to rebuild back stronger for those communities, and take advantage of the fact that there's a lot of other work going on there. But beyond that, we look at every aspect of our inspection programs and our vegetation management to see are there emerging risks or things we've learned over, frankly, fires over the last few years that would change the nature of those programs. But generally, it's the same programs. We continue to be as aggressive as we can in deploying those. And so I'd say that the wildfire mitigation plan that we've been working on is an extension of the plans modified for learnings over the past couple of years.

Thanks. And then one follow-up from a previous question. In terms of the timetable to access the wildfire fund, you know, recognizing that there's a number of moving pieces, is there any early indication of when you may start to pull capital from that fund?

Yeah, I think that's very premature, Ryan, just because we don't know what the process is. Obviously, we're still going through the investigation and the analysis. We want to be through all that, then we would have to go through some sort of settlement process. But if you believe that you can skip over all those things and think about sort of accessing the fund, first we have a billion dollars of customer-funded self-insurance. So if there were any claims that had to be paid, that would be the first piece. And then one would go to the wildfire fund, and there is a process that the And Fund Administrator has, which appears to be going very smoothly for others who have accessed it, where you accumulate the claims and you go and you get them reimbursed. So I think it's a pretty – they've made it a very streamlined, straightforward process once you hit the point where you need to access.

Thanks for taking my questions.

Thanks.

Thank you. I will now turn the call back over to Mr. Sam Ramraj for any closing comments.

Thank you for joining us. This concludes the conference call. Have a good rest of the day. You may now disconnect.

Thank you. You may now disconnect from today's conference. Have a good rest of your day.