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Fair Value Measurements (Tables)
 6 Months Ended
Jun. 30, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]  
Carrying Amounts and Fair Values of Long-term Debt, Including Current Portion
The carrying value and fair value of Edison International and SCE's long-term debt (including current portion of long-term debt) are as follows:
 
 
June 30, 2014
 
December 31, 2013
(in millions)
 
Carrying
Value
 
Fair
Value
 
Carrying
Value
 
Fair
Value
SCE
 
$
10,423

 
$
11,675

 
$
10,022

 
$
10,656

Edison International
 
10,826

 
12,106

 
10,426

 
11,084
Southern California Edison
  
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]  
Fair Value by Level
The following table sets forth assets and liabilities of SCE that were accounted for at fair value by level within the fair value hierarchy:
 
June 30, 2014
(in millions)
Level 1
 
Level 2
 
Level 3
 
Netting
and
Collateral1
 
Total
Assets at fair value
 
 
 
 
 
 
 
 
 
Derivative contracts
$
—

 
$
—

 
$
310

 
$
—

 
$
310

Other
32

 
—

 
—

 
—

 
32

Nuclear decommissioning trusts:
 
 
 
 
 
 
 
 
 
Stocks2
2,332

 
—

 
—

 
—

 
2,332

Fixed Income3
710

 
1,373

 
—

 
—

 
2,083

Short-term investments, primarily cash equivalents
320

 
25

 
—

 
—

 
345

Subtotal of nuclear decommissioning trusts4
3,362

 
1,398

 
—

 
—

 
4,760

Total assets
3,394

 
1,398

 
310

 
—

 
5,102

Liabilities at fair value
 
 
 
 
 
 
 
 
 
Derivative contracts
—

 
14

 
1,188

 
(7
)
 
1,195

Total liabilities
—

 
14

 
1,188

 
(7
)
 
1,195

Net assets (liabilities)
$
3,394

 
$
1,384

 
$
(878
)
 
$
7

 
$
3,907

 
December 31, 2013
(in millions)
Level 1
 
Level 2
 
Level 3
 
Netting
and
Collateral1
 
Total
Assets at fair value
 
 
 
 
 
 
 
 
 
Derivative contracts
$
—

 
$
11

 
$
372

 
$
(10
)
 
$
373

Other
39

 
—

 
—

 
—

 
39

Nuclear decommissioning trusts:
 
 
 
 
 
 
 
 
 
Stocks2
2,208

 
—

 
—

 
—

 
2,208

Fixed Income3
841

 
1,102

 
—

 
—

 
1,943

Short-term investments, primarily cash equivalents
331

 
—

 
—

 
—

 
331

Subtotal of nuclear decommissioning trusts4
3,380

 
1,102

 
—

 
—

 
4,482

Total assets
3,419

 
1,113

 
372

 
(10
)
 
4,894

Liabilities at fair value
 
 
 
 
 
 
 
 
 
Derivative contracts
—

 
37

 
1,177

 
(20
)
 
1,194

Total liabilities
—

 
37

 
1,177

 
(20
)
 
1,194

Net assets (liabilities)
$
3,419

 
$
1,076

 
$
(805
)
 
$
10

 
$
3,700

1 
Represents the netting of assets and liabilities under master netting agreements and cash collateral across the levels of the fair value hierarchy. Netting among positions classified within the same level is included in that level.
2 
Approximately 70% of SCE's equity investments were located in the United States at both June 30, 2014 and December 31, 2013.
3 
At June 30, 2014 and December 31, 2013, SCE's corporate bonds were diversified and included collateralized mortgage obligations and other asset backed securities of $61 million and $47 million, respectively.
4 
Excludes net payables of $20 million and net receivables of $12 million at June 30, 2014 and December 31, 2013, respectively, of interest and dividend receivables as well as receivables and payables related to SCE's pending securities sales and purchases.
Summary of Changes in Fair Value of Level 3 Net Derivative Assets and Liabilities
The following table sets forth a summary of changes in SCE's fair value of Level 3 net derivative assets and liabilities:
 
 
Three months ended June 30,
 
Six months ended June 30,
(in millions)
 
2014
 
2013
 
2014
 
2013
Fair value of net liabilities at beginning of period
 
$
(773
)
 
$
(882
)
 
$
(805
)
 
$
(791
)
Total realized/unrealized gains (losses):
 
 
 
 
 
 
 
 
Included in regulatory assets and liabilities1
 
(108
)
 
(76
)
 
(77
)
 
(158
)
Purchases
 
8

 
20

 
15

 
38

Settlements
 
(5
)
 
(29
)
 
(11
)
 
(56
)
Fair value of net liabilities at end of period
 
$
(878
)
 
$
(967
)
 
$
(878
)
 
$
(967
)
Change during the period in unrealized gains and losses related to assets and liabilities held at the end of the period
 
$
(116
)
 
$
(43
)
 
$
(84
)
 
$
(125
)

1 
Due to regulatory mechanisms, SCE's realized and unrealized gains and losses are recorded as regulatory assets and liabilities.
Valuation Techniques and Significant Unobservable Inputs Used to Determine Fair Value for Level 3 Assets and Liabilities
The following table sets forth SCE's valuation techniques and significant unobservable inputs used to determine fair value for significant Level 3 assets and liabilities:
 
Fair Value (in millions)
 
Significant
Range
 
Assets
 
Liabilities
Valuation Technique(s)
Unobservable Input
(Weighted Average)
Congestion revenue rights
 
 
 
 
 
 
June 30, 2014
$
310

 
$
—

Market simulation model
Load forecast
7,603 MW - 24,896 MW
 
 
 
 
 
Power prices
$(9.86) - $108.56
 
 
 
 
 
Gas prices
$3.50 - $7.10
December 31, 2013
366

 
—

Market simulation model
Load forecast
7,603 MW - 24,896 MW
 
 
 
 
 
Power prices
$(9.86) - $108.56
 
 
 
 
 
Gas prices
$3.50 - $7.10
Tolling
 
 
 
 
 
 
June 30, 2014
2

 
1,185

Option model
Volatility of gas prices
13% - 31% (17%)
 
 
 
 
 
Volatility of power prices
26% - 57% (32%)
 
 
 
 
 
Power prices
$37.20 - $70.20 ($49.50)
December 31, 2013
5

 
1,175

Option model
Volatility of gas prices
16% - 35% (21%)
 
 
 
 
 
Volatility of power prices
25% - 45% (30%)
 
 
 
 
 
Power prices
$38.00 - $63.90 ($47.40)