California\u2019s investor-owned utilities saw continued healthy earnings in the third quarter of 2008--even some increases compared to the same period last year. In addition, they generally are able to continue to finance capital spending plans and foresee continuing profitability. Utility executives attributed their profits to their regulated rates on investment. \u201cOur two utilities just posted their best quarter ever,\u201d said Donald Felsinger, Sempra Energy chief executive officer, November 10. Southern California Edison has \u201cno significant plans to reduce capital expenditures,\u201d said Jim Scilacci, Edison International chief financial officer, unveiling third quarter results November 7. Highlights of utilities\u2019 third quarter reports include: Edison International: The performance of the parent company for Southern California Edison did not match the state\u2019s other major utilities. Earnings slipped for Edison International. It reported third quarter net income at $439 million, compared to $461 million in the same quarter last year. Edison\u2019s regulated utility, Southern California Edison, showed $235 million in net income, compared to $262 million this quarter last year. The company attributed the decline to a CPUC decision related to faulty customer satisfaction surveys filed with the commission to justify customer service bonuses. The CPUC ordered a total of $145 million in refunds, fines, and incentive payment cancellations for the regulated utility (Circuit, Sept. 19, 2008). Building plans are mixed at the company. \u201cWe are operating under a capital conservation mode,\u201d said Ted Craver, Edison International chief executive officer. He said planned work on wind power projects through next summer remains on course, as well as planned solar projects. However, he said the company would carry out other projects only to the extent they can be financed. \u201cWe, like others,\u201d Craver stressed, \u201care focused on the realities of the near-term challenges.\u201d Overall, Edison International has $5.3 billion in liquidity, the chief financial officer said. Moreover, Southern California Edison has experienced no trouble accessing needed capital, just borrowing $500 million last month in the bond market at a 5.75 percent coupon rate. Pacific Gas & Electric: PG&E posted a net income of $304 million in the third quarter, up from $278 million over the same period in 2007. \u201cWe\u2019re showing solid performance despite the economy and difficulty in the capital markets,\u201d said PG&E chief executive officer Peter Darbee. He added that the company has had \u201congoing access to capital.\u201d The company projects an 8 percent growth rate, although it sees more signs that the economy is weakening, Darbee said. Therefore, the 8 percent forecast is at what Darbee said is the \u201clower end\u201d of expectations. Darbee pointed to the importance of obtaining interim performance payments for energy efficiency work, as well as bringing new power plants online, as important to meeting earnings goals. The issue of whether to grant interim bonuses to utilities based on their estimated energy efficiency achievements or wait for verified energy efficiency program results is pending before the California Public Utilities Commission (Circuit, Oct. 31, 2008). PG&E has $1.4 billion in liquidity, said Christopher Johns, PG&E chief financial officer. This includes $1.1 billion in bank lines. In the coming year, he said, the company expects to tap the credit market for $1 billion, in part to refinance $600 million in debt, and carry out capital projects. Sempra: Third quarter net income per share rose 8 percent over the same period last year, up to $308 million from $305 million. Sempra Energy\u2019s 8 percent increase is calculated based on fewer outstanding shares after the company bought back 18.4 million shares. Sempra is the parent company for two utilities--San Diego Gas & Electric and SoCal Gas. \u201cWhen you step back, our success in large part is due to how we allocate capital and manage risk,\u201d said Donald Felsinger, Sempra chief executive officer. While Sempra lost $3 million on its joint commodities venture with (bank of Scotland) RBS, net income rose at Sempra Generation and Sempra Pipeline and Storage by $34 million and $17 million respectively over the same period last year. Sempra LNG saw its first profit of $4 million in the third quarter. SoCal Gas won a net income increase of $14 million over the same quarter last year. SDG&E saw net income unchanged. Sempra has $2.5 billion in liquidity and plans to carry out major infrastructure projects, though perhaps at a slower pace depending upon financial conditions. To pursue the projects, it may seek to borrow $1 billion next year. Felsinger highlighted a $250 million solar program SDG&E is planning. He added he still believes the CPUC will approve an alternative route for the company\u2019s planned Sunrise Powerlink transmission line from Imperial Valley into San Diego. A CPUC administrative law judge has proposed nixing the line in favor of building new generating capacity within the utility\u2019s service area (Circuit, Nov. 7, 2008). Both Sempra utilities also have plans to roll out smart meters to their customers.