Along with an additional $221 million in costs for mostly natural gas-fired purchased power for its utility, Rosemead, CA-based Edison International is facing a mounting set of problems, which were reflected in third quarter results. The company’s pioneering independent power unit may have to file for Chapter 11 bankruptcy and be cut adrift.
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The impossibility of predicting future natural gas and coal prices adds to the dilemma, but Rosemead, CA-based Edison International’s two-edged conundrum involving an idled California nuclear plant and money-losing merchant coal-fired generation assets in Illinois and Pennsylvania remains unresolved as time constraints worsen the potential financial fallout.
Between now and March retail electric bills for some Southern California Edison Co. customers could be increased three times, the Rosemead, CA-based Edison International utility announced Tuesday, and two of the three rate hikes are attributable to continuing high wholesale natural gas prices. Sempra Energy’s Southern California Gas Co. utility said it expects retail gas bills to rise 45% to 55% this winter.
Moody’s Investors Service Wednesday again downgraded the merchant energy arm of Rosemead, CA-based Edison International for about $5.8 billion in debt securities and bank credit facilities. The rating outlook for Irvine, CA-based Edison Mission Energy (EME) and two of its affiliates remains “negative.” Moody’s removed the companies from review for further downgrade.
Citing dampened utility results mostly from a planned nuclear plant refueling, Rosemead, CA-based Edison International Wednesday reported first-quarter results that were down 34% compared with the same period last year (17 cents/share, compared with 26 cents/share for the first quarter, 2002). The utility holding company for Southern California Edison Co. said the results might have been worse without improved performance in its merchant energy sector.
Indicative of industry-wide trends in the same direction, Rosemead, CA-based Edison International’s senior executives told financial analysts Tuesday that the energy holding company is staking its future on restoring its traditional utility operations to full financial health.
Rosemead, CA-based Edison International’s merchant energy companies under the Edison Mission Energy (EME) family were slammed with credit rating downgrades to BB- from, in some cases, BBB- by Standard & Poor Ratings Services (S&P) reflecting heavy debt payments and restructuring facing it while wholesale power prices remain depressed, further worsening the chances of bringing more order to its chaotic financial house.
Rosemead, CA-based Edison International and its SouthernCalifornia Edison utility were hit with a $2.4 billion securitiesfraud class action federal lawsuit last Monday, alleging thecompanies’ violated parts of the federal securities law by bookingas revenue in the second and third quarters more than $2.3 billionin summer wholesale power costs that have yet to be collected.
Rosemead, CA-based Edison International and its SouthernCalifornia Edison utility were hit with a $2.4 billion securitiesfraud class action federal lawsuit Monday, alleging the companies’violated parts of the federal securities law by booking as revenuein the second and third quarters more than $2.3 billion in summerwholesale power costs that have yet to be collected.
Edison Mission Energy, the global independent power productionsubsidiary of Rosemead, CA-based Edison International, is quietlyretrenching and reorganizing its worldwide presence in a move thathas resulted in 100 workers being laid off.