Property, Plant and Equipment

12 Months Ended

Dec. 31, 2014

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)	2014			2013
Transmission	$	10,391		$	9,117
Distribution	19,255			17,874
Generation	2,986			2,856
General plant and other	4,889			4,674
Accumulated depreciation	(8,132		)	(7,493		)
	29,389			27,028
Construction work in progress	3,339			3,219
Nuclear fuel, at amortized cost	131			132
Total utility property, plant and equipment	$	32,859		$	30,379

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, 2014 and 2013, capitalized software costs included in general plant and other above, were $1.7 billion and $1.6 billion and accumulated amortization was $1.0 billion and $839 million, respectively. Amortization expense for capitalized software was $271 million, $251 million and $217 million in 2014, 2013 and 2012, respectively. At December 31, 2014, amortization expense is estimated to be approximately $275 million annually for 2015 through 2019.

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 10.

The following is SCE's investment in each project as of December 31, 2014:

(in millions)	Plant in Service		Construction Work in Progress		Accumulated Depreciation		Nuclear Fuel (at amortized cost)		Net Book Value		Ownership Interest
Transmission systems:
Eldorado	$	88	$	81	$	17	$	—	$	152	62%
Pacific Intertie	191		14		74		—		131		50%
Generating stations:
Palo Verde (nuclear)	1,871		83		1,529		131		556		16%
Total	$	2,150	$	178	$	1,620	$	131	$	839

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 customers and, therefore, did not affect SCE's earnings.