Updating its 10-year forecast from 2022, SCE’s parent has identified an additional 1.4 gigawatts of demand.
The parent company of Southern California Edison is registering demand growth more quickly than its leaders had been expecting—a trend that CEO Pedro Pizarro says will require grid upgrades “several years ahead of schedule.”
Speaking to analysts and investors after Edison International Inc. reported second-quarter net income of $509 million (up from $409 million in the prior-year quarter) on operating revenues of $4.34 billion, Pizarro said the 10-year load growth forecast his team prepared in 2022 is now outdated. Two years ago, Edison International planners projected the company would need to service 4.2 GW of additional demand in the coming decade. Today, they expect that figure to be 5.6 GW.
Commercial and residential development as well as the electrification of transportation systems are driving growth—and are likely to make today’s forecast look conservative, Pizarro and his team said.
“Grid upgrades will need to be implemented several years ahead of schedule to accommodate the increased load,” Pizarro said on a conference call. “A reliable, resilient and ready grid will require the utility to significantly expand the electric system through substantial investments that will drive continued rate base growth.”
Edison International’s executives are forecasting that the company’s capital expenditures from this year through 2028 will total $32.2 billion to $37.5 billion. But even that figure doesn’t include up to about $4 billion in additional investment opportunities ranging from technological tools to transmission lines.
Edison International isn’t the first company this year to note that its growth and capex projections are likely to need major revisions given the strong—and likely long-lasting—upward trends in infrastructure, manufacturing and electrification investments. In May, for example, PNM Resources Inc. leaders said they expect to scale up their capex plans in Texas’ Permian Basin after a new Electric Reliability Council of Texas study estimated that utilities in its territory would need to meet an extra 40 GW of demand over the next five to seven years compared to past forecasts.
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