1. EDISON INTERNATIONAL® SM Smart Grid Value Proposition October 4, 2010 Lynda Ziegler

2. EDISON INTERNATIONAL® SM 2 SCE’s vision of a smart grid is to develop and deploy a more reliable, secure, economic, efficient, safe and environmentally-friendly electric system covering all facets of electricity from production through transmission, distribution, and its smart use in homes, businesses and vehicles. SCE Smart Grid Vision

3. EDISON INTERNATIONAL® SM 3 1. Includes smart meters, energy smart appliances and customer devices, electric vehicles, DR, inverters and storage technologies Engaging Customers in the Supply Chain By 2020, there may be as many as 10 million intelligent devices 1 in SCE’s service area linked to the grid providing sensing information and automatically responding to prices/event signals Zero Net Energy Home

4. EDISON INTERNATIONAL® SM 4 Power 44% Hotels 67% Airlines 72% Chemicals 77% Pulp & Paper 84% Iron & Steel 89% Refining 93% No/limited product storage Product storage Source: Reliant Energy Capacity utilization (1997-2006 average) Smart Grid Efficiencies will help the Power Industry Improve its Capacity Utilization

5. EDISON INTERNATIONAL® SM 5 Smart Grid Value will be Enhanced by Understanding Customers’ Needs, which is Key to Engaging Our Customers Engagement –Cannot be a “third job” –Means understanding rates and the link between what is used and what is paid Demographics, attitudes and communication styles drive preferences The “green wave” matters Our experience is the “one size fits all” approach does not work Our challenge: offer relevant choices, make them easy, worthwhile, and fitted to diverse customer goals

6. EDISON INTERNATIONAL® SM 6 The New Customer Journey

7. EDISON INTERNATIONAL® SM 7 SCE Engagement Strategy: Integrate Rates & Programs Edison SmartConnect™ is the gateway to enhanced customer engagement Engagement is shaped through plans for distinctive customer types, which integrate –Energy Management Rates & Programs –Energy Information Tools –Emerging Services HAN PEV

8. EDISON INTERNATIONAL® SM 8 Source: Statewide Pricing Pilot Summer 2003 Impact Analysis, Charles Rivers Associates, August 9, 2004, Table 1-3, 1-4,. Time of Use TOU Residential Critical Peak Pricing Impacts By Rate Treatment 0% 10% 20% 30% 40% 50% Peak Load Reduction Critical Peak Fixed CPP-F 4.1% Critical Peak Variable With Automated Controls CPP-V 34.5% 12.5% Critical Peak Variable With Automated Controls CPP-V 47.4% Average Critical Peak Day – Year 1 Hottest Critical Peak Day Example of the Smart Grid Value Proposition: Rate and Technology Combinations Yield Reliability Benefits

9. EDISON INTERNATIONAL® SM 9 Critical Peak Pricing Events: Comparison of Legacy vs. Default MW In 2009 SCE had an average enrolled CPP population of 480 service accounts (80% industrial and 20% commercial) On October 2009, SCE defaulted 5,500 accounts > 200 kW to CPP SCE’s current CPP population consists of 50% commercial, 30% industrial and 20% government & institutional accounts As of September 2010, SCE has retained 59% of defaulted accounts A benefit of being on CPP is bill protection during the first year on the program Load reductions shown are net of load increases CPP events were 6 hours long in 2009, whereas in 2010, CPP events are 4 hours long

10. EDISON INTERNATIONAL® SM 10 Hourly Usage Data Daily Usage & Cost Data Web Presentment

11. EDISON INTERNATIONAL® SM 11 Budget Assistant Single Spending Goal Seasonal Spending Goals Web Stage 1 Web Stage 2

12. EDISON INTERNATIONAL® SM 12 SCE provides device registration, pairing and program enrollment services Device Marketing Customer may receive solicitation materials from SCE. Customer may learn about devices from retailers or web sites. SCE may distribute devices directly - and - Customer may purchase devices directly from retailer or website. Device Registration & Program enrollment Un-Enrollment and De-Commissioning Customer calls for un-enrollment or decommissioning support - or - Customer leverages self service options to de-commission devices (SCE.com, IVR). Troubleshooting Tiered support model involving SCE resources In some cases, customers will be referred to device manufacturer or third party service provider Device Usage Customer calls SCE regarding how to use device - and - Customer calls SCE regarding information displayed on device Customer performs self installation - or - Installation Contractor may install devices HAN Readiness Device Acquisition PCT Installation if applicable

13. EDISON INTERNATIONAL® SM 13 New Wave of Plug-in Electric Vehicles Over next three years, 10 – 14 models being introduced by major automakers and 5 – 8 models by start-ups Southern California will be an early target market Residential consumers will want a streamlined installation process Businesses will want workplace and public-access chargeports Governments will want chargeports for their fleets, employees, and citizens Cumulative Plug-in Vehicles in SCE Service Area (in thousands) Note: Chart includes both plug-in hybrid and battery electric vehicles.

14. EDISON INTERNATIONAL® SM 14 SCE’s Smart Grid Vision A cleaner, more diverse generation supply flowing through a smarter and more reliable electricity grid to serve customers who are using electricity more wisely, and in more ways, than ever before. © Copyright 2008, Southern California Edison

15. EDISON INTERNATIONAL® SM 15 SCE’s Smart Grid development strategy is the pursuit of technologies that provide significant customer value that exceeds the cost of implementation Edison SmartConnect™ is a foundational technology that provides a platform that can be utilized to leverage future customer technology Changes in customer behavior are critical to Smart Grid success Cultural change is dependant upon: –Public Policy –Infrastructure –People The Smart Grid / Customer Journey will be 20 + Years in the Making “Meters don’t save energy, people do.”