EDISON INTERNATIONAL

The cost of capital adjustment mechanism set by the CPUC provides for an adjustment to SCE's authorized cost of capital that, when triggered, will impact SCE's results of operations and cash flows. In 2023, the cost of capital adjustment mechanism was triggered and resulted in an increase to SCE's CPUC-authorized ROE from 10.05% to 10.75% effective January 1, 2024. The resulting increase to SCE's 2024 GRC-related revenue requirement was $201 million. The cost of capital adjustment mechanism was not triggered in 2024. In October 2024, the CPUC issued a decision modifying the cost of capital adjustment mechanism that changed the mechanism's adjustment ratio from 50% to 20%. This modification was also applied to the increase that was most recently triggered in 2023, effective on January 1, 2025. As a result, SCE's 2025 CPUC-authorized ROE was adjusted to 10.33%. The decision reduces SCE's updated 2025 GRC-related revenue requirement by approximately $117 million. For further information, see "—2025 General Rate Case." For additional information on cost of capital and the ratemaking process, see "Business—SCE—Overview of Ratemaking Process—CPUC."

SCE expects to file its regularly scheduled cost of capital application in March 2025 for rates effective for 2026 – 2028.