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While Pacific Gas & Electric apologized to the financial world for its quarterly earnings and upcoming investor guidance downgrade, the two parent companies of California’s other major investor-owned utilities projected brighter economic futures. Heavy capital investments are in the works for gas utilities for pipeline safety and maintenance. Electric utilities are pursuing new transmission lines. Edison International--Southern California Edison’s parent company reported $477 million in third quarter earnings. This time last year, it posted $426 million. The regulated utility accounted for $406 million of this year’s third quarter earnings. In the third quarter 2010, the utility posted $394 million in income. Over the next four years, the utility plans to spend between $15.6 billion and $17.5 billion in new investments. They include $9.1 billion for its distribution system, $5 billion for transmission, and $3 billion for new generation facilities. Those investments are allowed up to an 11.5 percent rate of return by the California Public Utilities Commission. Much of the utility’s investment is slated for new transmission lines in its territory, according to executives. Non-utility transmission builders are acceptable in California, but Edison claims it has the experience and wherewithal to build expensive and complicated lines to bring in electricity from rural areas to its customer territory. A new motion to the commission, revising its engineering for the Tehachapi line from the wind-rich mountain area to consumers is expected to be filed with regulators in the first half of 2012. “With the issues and delays” the Tehachapi line is expected to take between seven and 10 years to complete, said chief executive officer Ted Craver. Chino Hills continues to oppose running the line across its borders. The utility’s other transmission line projects are proceeding. Edison’s Devers-Colorado line is set for construction in December. The Eldorado-Ivanpah line is expected to break ground in early 2012. Edison is also in the midst of seeking rate increases in a docket at the commission. It expects a $24.7 billion rate base next year--up from $18.2 billion in 2011. PG&E Corp.--The parent company of Pacific Gas & Electric posted $203 million in income for the third quarter 2011. Last year at this time, its income was $261 million. Of this year’s third quarter income, the utility contributed $193 million compared to $262 million last year. In an effort to improve its reputation with the public and regulators, the utility plans to increase infrastructure spending. “You can’t PR or lobby your way to credibility,” Tony Early, PG&E Corp. chief executive officer said Nov. 3. PG&E plans to spend $200 million next year and another $200 million in 2013 to enhance its infrastructure, increasing customer service and training personnel. Some of that work was expected to be stretched out over a longer period of time, but the utility is accelerating the process, hoping to finish in 2013, said Chris Johns, PG&E president. The utility does not expect the full amount to be covered by ratepayers. The exact amount to be covered by shareholders is unknown at this point. Costs related to the September 2010 San Bruno pipeline explosion are running $237 million this year so far. Another cost to the company is the ongoing groundwater contamination in Hinkley. PG&E expects the water problem and related litigation to run $126 million in the short term. The utility is fighting a state water board order to provide a permanent alternative water source instead of continuing to provide bottled water. The utility was found to be the source of chromium 6 contamination in the area’s groundwater, which supplies drinking water. Sempra Energy--The parent company of both regulated utilities and unregulated energy businesses posted earnings of $296 million for the quarter. That’s well up from the third quarter last year, when earnings were $131 million. San Diego Gas & Electric reported third quarter income of $113 million. Last year at this time it was $106 million. Much of the increase was associated with the Sunrise Powerlink transmission line, said Debbie Reed, Sempra chief executive officer. She added that the project is 50 percent complete. SoCal Gas posted $81 million in earnings this quarter. In the third quarter 2010 it was $78 million. Sempra plans to invest $3.1 billion in pipeline safety over the next decade, said Reed. The majority is set for SoCal Gas pipelines, with $200 million expected for SDG&E. Unlike PG&E, which plans on using shareholder funds for part of its pipeline investments, Sempra believes that the California Public Utilities Commission will grant it full recovery from ratepayers for the project, according to Reed. For Sempra’s unregulated businesses, the corporation’s profits were mostly up. Sempra Generation posted $49 million in earnings. Last year for the quarter it was $59 million. In part, the lower profits were due to its energy crisis-era contract with the Department of Water Resources, which expired at the end of the second quarter. Sempra Pipelines & Storage reported $66 million for the third quarter. In 2010, it posted $43 million in earnings. Sempra LNG’s profits were up significantly, from $5 million in last year’s third quarter, to $24 million this time.

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