Lights out, monopoly on: Edison International between forest fire load and electricity demand boom

2026 — Q2 results and guidance reaffirmed; wildfire mitigation progress

Edison International reported second-quarter 2026 core earnings of $1.54 per share, with year-to-date core EPS at $2.97, and reaffirmed its 2026 core EPS guidance of $5.90–$6.20 alongside long-term core EPS growth targets of 5–7 percent. Management highlighted progress on wildfire mitigation and the Wildfire Recovery Compensation Program while noting impacts from the Eaton Fire. [3][1]

Investors framed EIX as an executing regulated-utility compounding story with near-term wildfire and operational noise but stable earnings growth driven by SCE's rate base and multi-year capital plan. The beat on core EPS supported confidence in guidance even as analysts watched revenue, wildfire costs, and capital recovery closely. [11][10]

2025 — CPUC final decision on SCE 2025 General Rate Case

The California Public Utilities Commission issued a final decision on September 18, 2025, in SCE's 2025 General Rate Case, authorizing a 2025 base revenue requirement of approximately $9.7 billion, an increase versus 2024 but materially lower than SCE's original request. The decision set allowed recovery for 2025–2028. [18][21]

The CPUC decision was interpreted by investors as mixed—it validated SCE's opportunity to grow rate base and earnings but limited near-term recoveries versus management's ask, with regulator focus on affordability. That balance supported a durable regulated-utility growth narrative but tempered upside expectations tied to faster cost recovery. [20][28]

2025 — SCE settlement with U.S. Forest Service over 2020 Bobcat Fire

Southern California Edison agreed to pay $82.5 million to settle claims by the U.S. Forest Service related to the 2020 Bobcat Fire, announced May 23, 2025. [29]

The settlement removed a notable litigation overhang tied to wildfire attribution and limited incremental parent exposure; investors saw it as risk-reducing for SCE/EIX though wildfire liability and regulatory recovery remained closely watched. [29]

2024–2025 — Wildfire self-insurance and Wildfire Recovery Compensation Program

Beginning July 1, 2023, SCE implemented a customer-funded wildfire self-insurance program and offered settlement and compensation paths, including the Wildfire Recovery Compensation Program for claims such as those related to the Eaton Fire. Edison disclosed settlements and recoveries in filings and investor materials in 2024–2025. [19][24][16]

Market perception evolved toward viewing wildfire exposure as increasingly manageable via a mix of self-insurance, CPUC cost-recovery processes, and settlement programs. That reduced tail risk but kept reputational and regulatory scrutiny elevated. Investors began to price in gradual normalization of wildfire-related charges and more predictable earnings. [20][16]

SCE collected customer contributions to the self-insurance program of $150 million in 2023 and $300 million in 2024 through CPUC-jurisdictional rates, with settlements related to the Eaton Fire noted in 2024–2025 filings. [26][16]

2023 — Wildfire-related charge updates and ongoing settlements

Edison International and SCE continued to record charges and update estimates for losses related to the 2017/2018 wildfires and mudslides, and to resolve later claims including Woolsey and Eaton Fire-related matters. SCE funded and executed settlements and moved toward mechanisms for recovery, with filings and the 2023 annual report documenting settlement payments and the approved self-insurance program. [25][36]

Investors tracked large cumulative wildfire exposures from legacy 2017/2018 events and treated settlement progress and regulatory recovery mechanisms as central to EIX's path back to normalized regulated utility valuation. The company's handling of legacy claims shifted perception from a distressed/legal-overhang story toward gradual resolution. [36][25]

As of year-end 2023, SCE had paid billions under executed settlements, with filings noting $7.6 billion paid under executed settlements as of December 31, 2022. The approved self-insurance program became effective for fires ignited between July 1, 2023, and December 31, 2024. [36][19]

2022 — Revisions to estimates for 2017/2018 Wildfire and Mudslide Events

Edison International and SCE revised upward their estimates for potential losses from the 2017/2018 Wildfire and Mudslide Events, including charges recorded in Q1 and further increases recognized in Q3 2022 tied to Woolsey litigation, prompting sizable pre-tax and after-tax charges and disclosures of remaining exposures. [39][40]

These upward revisions renewed investor concern about legacy wildfire liabilities and demonstrated that litigation and claim uncertainty could reintroduce earnings volatility. Markets treated EIX as a regulated utility with significant legacy legal risk requiring active capital and settlement management. [39][40]

Management recorded substantial charges in 2022, including a $390 million net charge in Q1 2022 related to upward revision and an $880 million increase in estimated losses for 2017/2018 events recognized as of September 30, 2022. [39][40]

2021 — Large reserve and settlement activity for 2017/2018 Wildfire and Mudslide Events

Edison International disclosed substantial settlement activity and updated its best estimate of total potential losses from the 2017/2018 Wildfire and Mudslide Events to $7.5 billion, with $5.3 billion resolved and $2.2 billion remaining as of Q3 2021. The company also arranged financing capacity with equity content up to approximately $1.0 billion to enable SCE debt issuance to pay settlements. [31][38]

In 2021 markets viewed EIX as a regulated utility under heavy legacy wildfire liability strain. Investor focus was on the company's ability to fund settlements without destabilizing capital structure while preserving earnings growth from rate base investment. The stock was treated as exposed to legal and regulatory execution risk despite utility fundamentals. [31][38]

The company reported a third-quarter 2021 net loss of $341 million, or −$0.90 per share, and disclosed the revised best estimate of total potential losses at $7.5 billion with $2.2 billion remaining unresolved, with planned issuance capacity including equity content up to approximately $1.0 billion to support financing of settlement payouts. [31][38]