Fair Value Measurements (Tables)

6 Months Ended

Jun. 30, 2011

Fair Value Measurements

Fair value by level

		As of June 30, 2011
(in millions)		Level 1		Level 2		Level 3			Netting and Collateral1			Total
Assets at Fair Value
Money market funds2		$	743	$	—	$	—		$	—		$	743
Derivative contracts:
	Electricity		—		44		231			(33	)		242
	Natural gas		—		65		11			—			76
	Fuel oil		6		—		—			(6	)		—
	Tolling		—		—		41			—			41
	Coal		—		1		—			(1	)		—
Subtotal of commodity contracts			6		110		283			(40	)		359
Long-term disability plan			9		—		—			—			9
Nuclear decommissioning trusts:
	Stocks3		2,062		—		—			—			2,062
	Municipal bonds		—		812		—			—			812
	U.S. government and agency securities		309		118		—			—			427
	Corporate bonds4		—		310		—			—			310
	Short-term investments, primarily cash equivalents5		4		31		—			—			35
Subtotal of nuclear decommissioning trusts			2,375		1,271		—			—			3,646
Total assets6			3,133		1,381		283			(40	)		4,757
Liabilities at Fair Value
Derivative contracts:
	Electricity		—		9		71			(9	)		71
	Natural gas		—		239		6			(1	)		244
	Tolling		—		—		481			—			481
Subtotal of commodity contracts			—		248		558			(10	)		796
Interest rate contracts			—		22		—			—			22
Total liabilities			—		270		558			(10	)		818
Net assets (liabilities)		$	3,133	$	1,111	$	(275	)	$	(30	)	$	3,939

		As of December 31, 2010
(in millions)		Level 1		Level 2		Level 3		Netting and Collateral1			Total
Assets at Fair Value
Money market funds2		$	1,100	$	—	$	—	$	—		$	1,100
Derivative contracts:
	Electricity		—		70		363		(61	)		372
	Natural gas		1		69		11		(1	)		80
	Fuel oil		8		—		—		(8	)		—
	Tolling		—		—		118		—			118
Subtotal of commodity contracts			9		139		492		(70	)		570
Long-term disability plan			9		—		—		—			9
Nuclear decommissioning trusts:
	Stocks3		2,029		—		—		—			2,029
	Municipal bonds		—		790		—		—			790
	Corporate bonds4		—		346		—		—			346
	U.S. government and agency securities		215		73		—		—			288
	Short-term investments, primarily cash equivalents5		1		31		—		—			32
Subtotal of nuclear decommissioning trusts			2,245		1,240		—		—			3,485
Total assets6			3,363		1,379		492		(70	)		5,164
Liabilities at Fair Value
Derivative contracts:
	Electricity		—		13		40		(21	)		32
	Natural gas		—		286		11		(4	)		293
	Tolling		—		—		344		—			344
	Coal		—		1		—		(1	)		—
Subtotal of commodity contracts			—		300		395		(26	)		669
Interest rate contracts			—		16		—		—			16
Total liabilities			—		316		395		(26	)		685
Net assets (liabilities)		$	3,363	$	1,063	$	97	$	(44	)	$	4,479

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

Money market funds are included in cash and cash equivalents and restricted cash on Edison International's consolidated balance sheets.

³

Approximately 68% and 67% of the equity investments were located in the United States at June 30, 2011 and December 31, 2010, respectively.

⁴

Corporate bonds are diversified, and included $27 million at both June 30, 2011 and December 31, 2010, respectively, for collateralized mortgage obligations and other asset backed securities.

⁵

Excludes net receivables of $11 million and net liabilities of $5 million at June 30, 2011 and December 31, 2010, respectively, of interest and dividend receivables and receivables related to pending securities sales and payables related to pending securities purchases.

⁶

Excludes $31 million at both June 30, 2011 and December 31, 2010, respectively, of cash surrender value of life insurance investments for deferred compensation.

Summary of changes in the fair value of Level 3 financial instruments

		Three months ended June 30,						Six months ended June 30,
(in millions)		2011			2010			2011			2010
Fair value, net asset (liabilities) at beginning of period		$	(44	)	$	(397	)	$	97		$	62
Total realized/unrealized gains (losses):
	Included in earnings1		18			(18	)		18			27
	Included in regulatory assets and liabilities2		(247	)		(294	)		(382	)		(781	)
	Included in accumulated other comprehensive income		(4	)		(2	)		(3	)		4
Purchases			22			26			28			32
Settlements			(20	)		(24	)		(31	)		(52	)
Transfers in or out of Level 3			—			6			(2	)		5
Fair value, net liability at end of period		$	(275	)	$	(703	)	$	(275	)	$	(703	)
Change during the period in unrealized losses related to assets and liabilities held at the end of the period3		$	(226	)	$	(287	)	$	(368	)	$	(717	)

¹

Reported in "Competitive power generation" revenue on Edison International's consolidated statements of income.

²

Due to regulatory mechanisms, SCE's realized and unrealized gains and losses are recorded as regulatory assets and liabilities.

³

Amounts reported in "Competitive power generation" revenue on Edison International's consolidated statements of income were $14 million and $(2) million for the three months ended June 30, 2011 and 2010, respectively, and were $8 million and $32 million for the six months ended June 30, 2011 and 2010, respectively. The remainder of the unrealized losses relate to SCE. See 2 above.

Carrying amounts and fair values of long-term debt

	June 30, 2011				December 31, 2010
(in millions)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt, including current portion	$	13,009	$	13,075	$	12,419	$	12,360