Property, Plant and Equipment

12 Months Ended

Dec. 31, 2013

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment

Property, Plant and Equipment

SCE's property, plant and equipment included in the consolidated balance sheets is composed of the following:

	December 31,
(in millions)	2013			2012
Transmission	$	9,117		$	7,059
Distribution	17,874			16,872
Generation	2,856			4,455
General plant and other	4,674			4,358
Accumulated depreciation	(7,493		)	(7,424		)
	27,028			25,320
Construction work in progress	3,219			4,271
Nuclear fuel, at amortized cost	132			609
Total utility property, plant and equipment	$	30,379		$	30,200

As a result of the permanent retirement of San Onofre, SCE reclassified utility plant and nuclear fuel into a regulatory asset. For further details, see Note 9.

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, 2013 and 2012, capitalized software costs were $1.6 billion and $1.5 billion and accumulated amortization was $839 million and $651 million, respectively. Amortization expense for capitalized software was $251 million, $217 million and $156 million in 2013, 2012 and 2011, respectively. At December 31, 2013, amortization expense is estimated to be approximately $255 million annually for 2014 through 2018.

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. A portion of the investments in Palo Verde generating stations is included in regulatory assets on the consolidated balance sheets. For further information see Note 11.

The following is SCE's investment in each project as of December 31, 2013:

(in millions)	Plant in Service		Construction Work in Progress		Accumulated Depreciation		Nuclear Fuel (at amortized cost)		Net Book Value		Ownership Interest
Transmission systems:
Eldorado	$	87	$	10	$	15	$	—	$	82	62%
Pacific Intertie	189		7		74		—		122		50%
Generating stations:
Palo Verde (nuclear)	1,842		77		1,505		132		546		16%
Total	$	2,118	$	94	$	1,594	$	132	$	750

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

Sale of Interests in Four Corners Units 4 and 5

In December 2013, SCE completed the sale of its ownership interest in Units 4 and 5 of the Four Corners Generating Station, a coal-fired electric generating facility in New Mexico, to the operator of the facility, Arizona Public Service Company and received net proceeds of approximately $181 million. Under the sale agreement, SCE remains responsible for its pro-rata share of certain environmental liabilities, including penalties arising from environmental violations arising prior to the sale. The sale of Four Corners resulted in a $166 million benefit to SCE's ratepayers and, therefore, will not affect SCE's earnings.