Property, Plant and Equipment

12 Months Ended

Dec. 31, 2011

Property Plant And Equipment Disclosure [Abstract]

Utility Property, Plant and Equipment

Utility property, plant and equipment included on the consolidated balance sheets is composed of the following:



	December 31,
(in millions)	2011			2010
Transmission	$	6,109		$	5,811
Distribution	15,938			14,878
Generation	4,063			3,371
General plant and other	3,951			3,377
Accumulated depreciation	(6,894		)	(6,319		)
	23,167			21,118
Construction work in progress	3,922			3,291
Nuclear fuel, at amortized cost	480			369
Total utility property, plant and equipment	$	27,569		$	24,778

Capitalized Software Costs

SCE capitalizes costs incurred during the application development stage of internal use software projects to property, plant, and equipment. SCE amortizes capitalized software costs ratably over the expected lives of the software, ranging from 5 to 15 years and commencing upon operational use. At December 31, 2011 and 2010, capitalized software costs were $1.4 billion and $1.1 billion and accumulated amortization was $491 million and $393 million, respectively. Amortization expense for capitalized software was $156 million, $129 million and $88 million in 2011, 2010 and 2009, respectively. At December 31, 2011, amortization expense is estimated to be approximately $174 million annually for 2012 through 2016.

Jointly Owned Utility Projects

SCE owns interests in several generating stations and transmission systems for which each participant provides its own financing. SCE's proportionate share of these projects is reflected in the consolidated balance sheets and included in the above table. SCE's proportionate share of expenses for each project is reflected in the consolidated statements of income. All of the investments in the Mohave generating station and a portion of the investments in San Onofre and Palo Verde generating stations are included in regulatory assets on the consolidated balance sheets—see Note 14.

The following is SCE's investment in each project as of December 31, 2011:



(in millions)	Plant in Service		Construction Work in Progress		Accumulated Depreciation		Nuclear Fuel (at amortized cost)		Net Book Value		Ownership Interest
Transmission systems:
Eldorado	$	71	$	4	$	13	$	—	$	62	60%
Pacific Intertie	189		2		68		—		123		50%
Generating stations:
Four Corners Units 4 and 5 (coal)	589		17		519		—		87		48%
Mohave (coal)	327		24		287		—		64		56%
Palo Verde (nuclear)	1,803		54		1,465		138		530		16%
San Onofre (nuclear)	5,198		370		4,111		342		1,799		78%
Total	$	8,177	$	471	$	6,463	$	480	$	2,665

In addition to the projects above, SCE has ownership interests in jointly owned power poles with other companies.

On November 8, 2010, SCE entered into an agreement to sell its ownership interest in Units 4 and 5 of the Four Corners coal-fired electric generating facility to the operator of the facility, Arizona Public Service Company. The sale price is $294 million, subject to certain adjustments. The closing of the sale is contingent upon the receipt of regulatory approvals and other specified closing conditions and is estimated to occur in the second half of 2012. Any gain on sale will be for the benefit of SCE's customers and, therefore, will not affect SCE's earnings.

Competitive Power Generation and Other Property, Plant and Equipment

Competitive power generation and other property included on the consolidated balance sheets was composed of the plant and related facilities of EMG:



	December 31,
(in millions)	2011			2010
Building, plant and equipment	$	4,708		$	4,572
Emission allowances	672			1,305
Leasehold improvements	4			177
Furniture and equipment	130			97
Land (including easements)	64			84
Construction work in progress¹	377			1,036
	5,955			7,271
Accumulated depreciation	(1,408		)	(1,865		)
Competitive power generation and other property – net	$	4,547		$	5,406


¹	Construction work in progress consisted of $357 million and $888 million at December 31, 2011 and 2010, respectively, for new gas and wind projects under construction.

EMG recorded $1.7 billion of impairment charges in 2011. For additional information on these charges, see Note 16.

The power sales agreements of certain wind projects are classified as operating leases. The carrying amount and related accumulated depreciation of the property of these wind projects totaled $1.6 billion and $203 million, respectively, at December 31, 2011.

- Definition

The entire disclosure for long-lived, physical assets that are used in the normal conduct of business to produce goods and services and not intended for resale. Examples include land, buildings, machinery and equipment, and other types of furniture and equipment including, but not limited to, office equipment, furniture and fixtures, and computer equipment and software. This disclosure may include property plant and equipment accounting policies and methodology, a schedule of property, plant and equipment gross, additions, deletions, transfers and other changes, depreciation, depletion and amortization expense, net, accumulated depreciation, depletion and amortization expense and useful lives, income statement disclosures, assets held for sale and public utility disclosures.

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