Edison International Provides Update on Ongoing Investigation into Eaton Fire Origin

Rhea-AI Summary

Southern California Edison (SCE), a subsidiary of Edison International, announces the next phase of its investigation into the Eaton Fire starting March 17. The investigation includes detailed physical inspections and testing of electrical equipment in Eaton Canyon, conducted in coordination with fire investigators and local authorities.

The inspection protocol, developed collaboratively with stakeholders, will involve:

• Climbing examinations of towers
• Resistance and current injection testing
• Additional drone inspections

Following the January 2025 Southern California wildfires, SCE has made significant progress in rebuilding efforts, including:

• Setting over 1,860 poles
• Installing more than 690 transformers
• Stringing approximately 161 miles of power lines

The company is upgrading infrastructure with fire-resistant equipment, covered conductors, and expedited undergrounding projects in Altadena and Malibu. The full investigation is expected to take several months to complete.

Positive

• Comprehensive infrastructure upgrade with fire-resistant equipment and covered conductors
• Significant progress in rebuilding: 1,860 poles, 690 transformers, 161 miles of power lines installed
• Expedited undergrounding projects in high-risk areas

Negative

• Ongoing investigation into potential company responsibility for Eaton Fire
• Several months delay expected for investigation completion
• Substantial infrastructure damage requiring extensive rebuilding efforts

Insights

Financial Analyst

Edison International's update on the Eaton Fire investigation represents continued uncertainty regarding potential liability exposure for the utility. The involvement of "plaintiffs' counsel" in the inspection process signals ongoing litigation risk, though the collaborative approach to the investigation demonstrates transparency that could potentially mitigate regulatory backlash.

The company's statement that "determination of cause is not expected" following this inspection phase and that the full investigation will take "several months to complete" extends the timeline for definitive liability determination. For context, California utilities have historically faced significant financial consequences from wildfire incidents, with settlements potentially reaching billions of dollars.

The scale of restoration efforts (1,860+ poles, 690+ transformers, 161 miles of power lines) indicates substantial capital expenditures already incurred. More significantly, SCE's decision to replace equipment with fire-resistant alternatives and expedite undergrounding projects suggests ongoing elevated capital spending that could impact near-term financial performance.

While these hardening investments align with California's regulatory priorities and may reduce future wildfire risk, they represent increased costs during a period of potential liability uncertainty. The market will likely maintain a risk premium on EIX shares until investigation conclusions provide clarity on potential financial exposure from the January 2025 wildfires.

Regulatory Affairs Specialist

This investigation update highlights Edison International's strategic regulatory positioning through its collaborative inspection protocol development. By incorporating input from multiple stakeholders including local governments and plaintiffs' counsel, SCE demonstrates compliance with California's enhanced utility accountability framework that emerged following previous wildfire incidents.

The methodical approach to equipment testing—including resistance tests, soil resistivity measurements, and current injection testing—aligns with regulatory expectations for thorough investigations. SCE's transparency in sharing that they "do not anticipate having an immediate update" appropriately manages expectations while following regulatory best practices for wildfire investigations.

Most notable from a regulatory perspective is SCE's proactive infrastructure hardening approach. The replacement of standard equipment with fire-resistant alternatives and covered conductors directly addresses California Public Utilities Commission's wildfire mitigation priorities. The accelerated undergrounding projects in Altadena and Malibu represent alignment with the state's increasing emphasis on undergrounding in high-risk areas.

This positioning appears designed to demonstrate responsible utility management regardless of the investigation outcome. Should equipment failure be identified as a fire cause, SCE can point to its comprehensive remediation efforts as evidence of corrective action, potentially moderating regulatory consequences that might otherwise include penalties or enhanced oversight requirements.

Company will Begin Next Phase of Physical Inspections and Testing of Electrical Equipment in Eaton Canyon; Determination of Cause is Not Expected

Inspection Protocols were Developed through Collaborative Process with Input from Interested Stakeholders

ROSEMEAD, Calif.--(BUSINESS WIRE)-- Edison International’s subsidiary, Southern California Edison, will begin the next phase of physical and video inspections and testing of electrical equipment in Eaton Canyon on March 17. This phase of testing will continue for several weeks in the field, followed by lab and engineering analysis.

This next step in the investigation will be SCE’s first close-up physical inspection since the start of the Eaton Fire. It is being conducted in close coordination with fire investigators, Los Angeles County, the cities of Pasadena and Sierra Madre and plaintiffs’ counsel, each of whom can have representatives present at the examination sites. The protocol for the upcoming inspections has been developed through a collaborative process with input from interested stakeholders, in line with SCE’s commitment to conduct a thorough and transparent investigation.

SCE conducted drone and on-site visual inspections from helicopters and the ground once it was safe to do so following the January 2025 Southern California wildfires. The next phase of inspections of the Eaton Canyon SCE equipment (subject to weather conditions) will include:

• Climbing Examinations: SCE crews will climb each tower to conduct detailed, in-person inspections and close-up photography of the equipment.
• Resistance, Soil Resistivity and Current Injection Testing: SCE will perform resistance and current injection testing to assess connection conductivity and resistance to ground.
• Additional Drone Inspections: Aerial inspections using drones will allow for a detailed visual assessment and photography of the active and idle electrical towers, power lines and other equipment in the area. Building on the drone inspections SCE has done previously, these inspections will be conducted in close cooperation with other stakeholders as part of a coordinated effort and shared with all parties.

SCE does not anticipate having an immediate update following the upcoming inspection and testing and continues to expect the full investigation to take several months to complete. Following the conclusion of this phase of testing, SCE will conduct a comprehensive review of the data collected (in coordination with third-party experts) and will move forward as quickly as possible in analyzing results.

SCE’s Restore and Rebuild Efforts

In responding to the windstorms and emergencies created by the Eaton and Palisades fires, SCE crews have been working to rebuild the electrical system with a mission of building back stronger and more resilient. SCE teams have, in total:

• Set more than 1,860 poles
• Installed more than 690 transformers
• Strung at least 724,075 feet of power lines, or about 161 miles.

SCE crews have been working to replace damaged equipment with fire-resistant equipment and covered conductor (also known as coated wire). SCE has also expedited undergrounding projects and begun work to underground multiple sections of lines in Altadena and Malibu, where permits have been approved, and projects were already engineered.

About Edison International

Edison International (NYSE: EIX) is one of the nation’s largest electric utility holding companies, focused on providing clean and reliable energy and energy services through its independent companies. Headquartered in Rosemead, California, Edison International is the parent company of Southern California Edison Company, a utility delivering electricity to 15 million people across Southern, Central and Coastal California. Edison International is also the parent company of Trio (formerly Edison Energy), a portfolio of nonregulated competitive businesses providing integrated sustainability and energy advisory services to large commercial, industrial and institutional organizations in North America and Europe.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250314061695/en/

Media Relations: (626) 302-2255

News@sce.com

Investor Relations: Sam Ramraj, (626) 302-2540

Source: Edison International

FAQ

What is the scope of SCE's electrical equipment inspection for the Eaton Fire investigation?

SCE will conduct climbing examinations of towers, resistance testing, soil resistivity measurements, current injection testing, and detailed drone inspections of electrical equipment in Eaton Canyon starting March 17.

How many poles and transformers has SCE installed during the Eaton Fire rebuild efforts?

SCE has set more than 1,860 poles and installed over 690 transformers as part of their restore and rebuild efforts.

What infrastructure improvements is SCE implementing after the Eaton Fire?

SCE is installing fire-resistant equipment, covered conductors (coated wire), and expediting undergrounding projects in Altadena and Malibu areas.

How long will SCE's Eaton Fire investigation take to complete?

The full investigation is expected to take several months to complete, with the next phase of testing continuing for several weeks followed by lab and engineering analysis.