Good afternoon and welcome to the Edison International Third Quarter 2016 Financial Teleconference. My name is Christie, and I will be your operator today. Today's call is being recorded. Now, I will turn the call over to Mr. Scott Cunningham, Vice President of Investor Relations. Mr. Cunningham, you may begin your conference.

Thanks, Christie, and welcome, everyone. Our speakers today are President and Chief Executive Officer, Pedro Pizarro, and Executive Vice President and Chief Financial Officer, Maria Rigatti. Also here are other members of the management team. Materials supporting today's call are available at www.edisoninvestor.com. These include our Form 10-Q, Pedro and Maria's prepared remarks, and the teleconference presentation. Tomorrow afternoon, we will distribute our regular business update. During this call, we will make forward-looking statements about the future outlook for Edison International and its subsidiaries. Actual results could differ materially from current expectations. Important factors that could cause different results are set forth in our SEC filings. Please read these carefully. Presentation includes certain outlook assumptions as well as reconciliations of non-GAAP measures to the nearest GAAP measure. During Q&A, please limit yourself to one question and one follow-up. I'll now turn the call over to Pedro.

Thank you, Scott, and good afternoon, everyone. I'm excited and also humbled to be here on this first earnings call with Maria in our new roles. I want to thank Ted Craver and Jim Scilacci for all of their help in our transition over the summer. I also thank many of you who Ted and I had an opportunity to visit in September. While the main purpose of our visits was to share our key messages on continuity of leadership and continuity of strategy, I believe I benefited the most from the visit as the dialog helped me a great deal. I look forward to our continued discussion and our team will strive hard to maintain our commitment to transparency and full engagement with our investors. In today's call, Maria will cover the financial results, so I will focus on the recent strategic developments at SCE and in California that will help shape Edison International's long-term growth. I'll start with the SCE's 2018 General Rate Case filed September 1. This filing demonstrates SCE's commitment to three key strategy elements. First: maintain a safe and reliable wires network. Second: be a key enabler of California's commitment to addressing climate change through significant greenhouse gas reduction led by our proposed grid modernization efforts to support widespread adoption of solar, storage, electric vehicle charging and other technologies. And finally, continue our operational excellence journey to achieve top quartile performance in safety, reliability, customer satisfaction and cost. We believe we have made a strong case for our strategy and for the requested funding levels in our rate case filing. Recently, CPUC President Picker and two administrative law judges were assigned to the case. President Picker is also leading the broader proceeding, looking at distribution resource plans, which is addressing many of the policy and…

Thanks, Pedro. It is a privilege and honor to be here and I look forward to working with everyone in my new role. Now, let's review the number. I plan on following a format similar to what we've been using in prior earnings calls, commenting on the financial results, our updated guidance, our capital plans, and a few other financial topics. I will try not to repeat the numbers you can see in the presentation, but rather focus on the underlying trends and explanations. Please turn to page two of the presentation. As discussed in our prior investor calls this year, quarterly earnings comparisons are awkward due to the timing of last year's rate case decision. SCE reflected the proposed decision in the third quarter of last year. At the time, SCE recorded most but not all of the expected impacts of that proposed decision. Some of last year's third quarter impacts related to the first half of 2015, so the third quarter comparisons are not perfectly aligned. Comparisons to the prior year are clearer in the year-to-date information. Also, SCE now operates under the tax accounting memorandum account or TAMA approved in the 2015 rate case decision. This has reduced the variability around taxes. As we indicated on the last earnings call, SCE is doing better than our original earnings guidance. This is reflected in the updated guidance I will discuss shortly. Also as expected, holding company costs are higher than our original guidance as we suggested last quarter. We continue to fine-tune the level of cost needed to successfully develop our new competitive businesses without undue drag on consolidated results. With that background, let's look specifically at third quarter results. For SCE, the largest positive impact on revenue is the $0.13 per share benefit related to the timing…

Thank you. And our first question is from the line of Julien Dumoulin-Smith of UBS. Your line is open now.

Hi, good afternoon.

Hi, Julien.

Hey. So, quick question, listen, I understand you can't say too much here. Cost of capital settlement discussions, is that something that, obviously, you'd be open to and, perhaps, can you comment on the debt recovery piece in that? Where do you stand relative to with authorized rates if you can comment on that at all?

Sure, Julien. This is Maria. Clearly, we're open to settlement discussions with our stakeholders. That's probably all I'm going to say about that. And relative to any components of what that might look like, again, don't want to negotiate with anybody on the phone, but we'd certainly be to consider things in terms of a total package.

Got it. Excellent. And then a little bit of a follow-up here on storage. Obviously, there were some developments in the state on a legislative front in the quarter. Can you comment on what that means for you guys?

Sure. Certainly, the 500 – you're talking about the 500 megawatts of additional energy storage. It's still early days. We have to see were that lands for us in terms of how that would be split amongst the three IOUs, et cetera. So, early days to know exactly what it will mean for us. We are proceeding with our other energy storage activities. We have about 40 megawatts or so in the GRC that we recently filed. We're moving forward with the Aliso Canyon Energy Storage. We think it's all part and parcel, but that 500 megawatt's still under review.

And sorry, to clarify that, to what extent is it or what aspects of it for you guys...

Oh, no. I mean how it's all going to play out in terms of our spending. Sorry.

Got it. But there is some ability to do it. It's just a matter of like to what extent you will do it and at what point in time?

Yeah. The state will need a process for actually implementing the legislation and allocating out the 500 megawatt sale. The immediate first step here is just going through the regulatory implementation steps.

Got it. All right. Thank you.

Thanks, Julien.

And our next question is from the line of Michael Weinstein of Credit Suisse. Your line is open now. Michael Weinstein - Credit Suisse Securities (USA) LLC (Broker): Hi, guys.

Hi. Michael Weinstein - Credit Suisse Securities (USA) LLC (Broker): Hey, I realize that I think you're planning on bounding – I think you talked about bounding the Edison Energy Group losses at some point probably in the February timeframe when you're going to give 2017 guidance. But I'm wondering if you can give some color around where that bounding might occur and how you're thinking about the business going forward.

Hey, Michael. So, certainly, in terms of the discussion about bounding, we do intend to do that. We've already kind of said during our prepared remarks that we were going to bound that at no more than the 2016 guidance levels for EIX parent and other. As we move through the rest of the year and we're kind of compiling all of our budget information, we'll be able to provide more detail as to exactly how that shakes out at Edison Energy Group. Michael Weinstein - Credit Suisse Securities (USA) LLC (Broker): Okay. Thank you very much.

Thank you. And our next question is from the line of Greg Gordon, Evercore ISI. Your line is open now.

Thanks. Good afternoon.

Hi, Greg.

Hey, Greg.

When we think about how you're trying to work on the glide path for dividend policy, you've been pretty clear and consistent. So when I look out past 2017 and I think about the GRC, the fact that productivity and financing benefits will probably all get wrapped into the next rate case decision, is it right to think about the rate base math for minus the parent overheads and where we think you'll sort of try to target Edison Energy Group drag to come up with sort of a 2019-2020 theoretical earnings growth, earnings numbers in order to set the kind of dividend growth policy that you'll have through that transition?

Hey, Greg. It's kind of early days right now to actually know what's going to happen in the GRC itself. Obviously, our dividends are all keyed off of SCE earnings. As that continues to grow with the rate base growth, you'll see a continuing ability to bring our dividend up in steps over time, as Pedro said earlier. So, I think that's really how we're thinking about it.

Okay. So we should think about it in terms of a payout off of the rate base earnings power of SCE?

Absolutely.

Okay. That's clear. Thank you.

Okay. Thank you. And our next question is from Jonathan Arnold of Deutsche Bank. Your line is open.

Good afternoon, guys.

Hey, Jonathan.

Hey.

Hi. Could I just – just want to be extra sure I understand the sounding of the holding company drag. Are you saying that Edison Energy Group and the parent combined in 2017 will not exceed the kind of combined number for 2016 or is it that the EEG piece won't exceed the combined number from 2016?

No, the former. So the combined number for 2017 not to exceed the combined number for 2016.

Okay. And so, obviously, there will be something for the parent. So what you're going to give us with the guidance is kind of how you get to this number, which is going to be either the same or lower than 2016?

Yes.

Okay.

Actually, you're echoing a little bit. I think you said that we'll give you more information around the parent then, yes, absolutely.

Yeah. But you're effectively saying the combined number is going to be the same or lower and...

That's right.

...the composition of it you'll give us with the guidance.

That's right.

Okay, great. Thank you. And then one other – we noticed recently that the ALJ on the SONGS case was reassigned. Are you guys able to share any intelligence as to what might be going on there? What it might mean for the schedule?

Yeah. So, don't have any insights on the schedule. I think we saw one press report that said the ALJ was leaving or retiring. So, what we've seen is the appointment of – assignment of a new ALJ. And so, we have an ex parte ban, so we don't get into this sort of detail with the Commission. So, we believe that the settlement terms continue to be fair and – but as I mentioned in my comments, we don't have a way to handicap at this point when the Commission will act.

Okay. And then just finally, on the SCE equity ratio, I think you said it's north of 50% as of September. Is that seasonal? Do you see it tracking down as you move through this rate case period or should we imagine it holds around that level? What does the model show?

Look, 50.4% was where we're at September 30. And that number is north of the 48% that's our authorized equity ratio. We will, over time, I'm sure see that bleed down, although, that really does give us the flexibility to manage our capital program, our dividend program, and all of that. So, we actually think that's a good spot to be in.

Okay. And if I could just some one – sort of related topic, you mentioned, I think, West of Devers being appealed and then the Mesa Substation design being called into question. If you see – which year were those projects expected to benefit most and so if they slip to the right, is it a 2017 issue? Is it more a 2018 issue? Can you just give a little more color and then maybe how one might backfill it?

So those projects – both of those projects are being reviewed by the CPUC. I will say the review is not about whether or not those projects are needed. The review is about exactly how those projects should be built out. And we are still assessing what the impact would be on the schedule and the cost. Certainly, reengineering a project could potentially cause it to be delayed, but there are some suggestions as to different types of projects that could actually increase the cost of those projects. So, we're currently in the process of looking at what the different proposals are and whether or not we need to start engineering around some of those different proposals. Mesa is a very good example that, in that case, other alternatives have been proposed, but in fact the California ISO has said that each one of the alternatives that have been proposed either don't meet the needs or don't meet the time requirement.

Just one global comment on this just to summarize it. This is not a question of if it's just a question of when.

So, in the current plan, were these 2017 projects primarily or further out?

No, they actually spread over a pretty long period. I think the in-service dates of the NEE dates, there's a chart in our presentation, but the NEE (35:55) dates are like 2020, 2021 for most of these projects. So you see cost spread over the entire period.

Okay. All right, I'll take a look at that. Thank you very much, guys.

Just to note though, Jonathan, we have not changed any of our forecast at this point, while we wait for those decisions.

Well, is that because you're assuming that you'll find other things to bring forward or some other reason, or just waiting to get the outcome before you make a change? I'm not sure what you're implying?

Two things. Certainly, we do look for ways to redeploy our capital when something is delayed, but secondly also that we will be in the process as we get more information to update our numbers.

Okay. Thank you very much.

Thanks, Jonathan.

Okay. Thank you. And our next question is from Praful Mehta of Citigroup. Your line is open.

Hi, guys.

Hey.

Hey.

Going back to Edison Energy again and wanted to more understand, from a cash cost perspective, given there is a bunch of investment happening there, I'm not sure if the earnings impact that you're talking about reflects what? Is it an O&M expense? Is it depreciation on investment? Just if you can give some color on what the cash cost you expect there and how does that profile kind of look between earnings and cash?

You know at the end of the last year, we did deploy some capital, some cash to purchase the three companies at Edison Energy. On a go-forward basis, we have a service model. We're focused on providing energy as a service, so the capital needs of those companies from an investment perspective is not gigantic. There are some operating expenses. So, of course, that's why you're seeing the drag at the holding company – in the holding company cost. The numbers themselves are pretty immaterial relative to the overall Edison International structure. So, I think that kind of bounds it for you, I don't know, Pedro... (38:05)

No, I think that's captures it. And given the questions that I think we've all gotten from a number of you as we chatted through September, we wanted to make sure we provided some near-term clarity as to what the overall earnings impact was at the total consolidated EIX level. That's why we focused on that today and then we'll have more detail we can provide first in February when we issue 2017 guidance. But I think before – you're also getting to what's the nature of the business itself and what's more of a business model question. And that goes to providing a detailed business plan to our investors, which I mentioned in my comments, we expect to do no later than 12 months from now. So, I think that will clarify our best thinking at that point. And influenced by feedback, we've been getting from customers over the last few months, just thinking in terms of what is that model and what do we see as some of the key milestones and outlays over the years ahead.

Got you. And the bounding is definitely helpful, so definitely appreciate that.

Good. Thanks.

And on slide five, you mentioned here the $4 billion of capital spend with $2 billion annual rate base increase right into the next decade. Now, as you're growing rate base, clearly, as a percentage of rate base, that growth is dropping off. So, is this a signal to indicate a drop-off in the percentage growth or is it more to say that this is the base case and there is more incremental to that to kind of maintain a 7-percentage growth as well?

Actually, I think that's a message you've heard consistently in several other earnings calls in the past. I think what we said is, we see a continued case supporting for at least $4 billion a year in CapEx. I think we've acknowledged in the past that assuming that that continues, which we see that opportunity, that provides a floor for growth. And to the extent that we're investing at that, call it $4 billion, $4-ish billion level, as the denominator grows the percent increase in the denominator starts tailoring down. That said, you saw in our general rate case application that the request that we provided if we got the total request, which we don't expect we get 100% of that, but we think we provided a very strong case, that rate case for requests would take us over to $5 billion, which would then be a step-up in that rate. So, I guess the final point I'll make here is, again, think about this as a floor, but as we look at the California opportunity, that's a really interesting opportunity over certainly the decade ahead, and as I mentioned in my comments, we're still – not just we as SCE, but we the state are still trying to get our arms around what SB 32 will really mean, All right? What is the nature of that opportunity when you have to reduce greenhouse gases by more than 40% from where we are today? That's going to require a fair amount of infrastructure. Early to say how much that might be new infrastructure that translates into rate base, how much of that would be infrastructure that's done on the customer side or by other entities. It will certainly imply a good opportunity in terms of the usage of the grid. But I think, net-net, when you look at SB 32, when you look at some of the other upsides around items like the storage item that Julien asked about earlier, we do see continued support for investing at, at least that floor $4 billion and to the extent that we're only investing at that floor then, yes, you'd see the ratio ease off over time. Does that make sense?

Yes, it does. I really appreciate it. Thank you.

You bet. Thank you.

And our next question is from the line of Michael Lapides of Goldman Sachs. Your line is open.

Hey, Michael. Michael Lapides - Goldman Sachs & Co.: Hey, guys. A couple of questions; I'll start on the non-utility or non-regulated side of the business. Have you communicated, or is this what's coming a year from now, what your anticipated goal is in terms of when you expect this investment to generate earnings power for the company or when you expect this investment to generate positive not negative free cash for the company?

I think that will be part of the detail that we aim to provide in a business plan, Michael. Michael Lapides - Goldman Sachs & Co.: Okay.

So, the item no later than 12 months from now. Michael Lapides - Goldman Sachs & Co.: And have you discussed or disclosed the amount of capital you deployed in this business? I would assume it's available in the 10-Q, which hit 30 or 40 minutes ago, but just kind of what's your plan for capital spending. Is it large enough to have shown up in your CapEx tables yet?

So, you can see that disclosed the parent section of the cash flows. But, really, the bulk of what we spent is that $100 million last year to buy the three companies that are basically Edison Energy. Michael Lapides - Goldman Sachs & Co.: Got it. And then coming back to SCE, there is the potential at some point in the coming months or so that you'll give results in the Mitsubishi arbitration, and half of those proceeds would come to the utility and the other half would go to customers. How do you think about how you would utilize those proceeds, the proceeds that come back to the utility?

And I think, actually, Pedro might have mentioned this in his comments...

Right.

...is that we would really retain out of the utility an offset to the extent that we were using short-term debt to really fund the capital program that we see, which is, as you know from the GRC, pretty substantial. Michael Lapides - Goldman Sachs & Co.: Right. But you've already got a pretty healthy equity layer at the utility and you've got some runway in I assume the Mitsubishi cash. If there is any cash, isn't going to just come overnight. It may take a little while for it to come in, so in that timeframe, the equity layer continues to grow. I'm just curious about are you commenting on the short-term debt side that you're worried your short-term balance is getting a little too healthy or too thick, or is there just less balance sheet capacity than maybe I'm thinking about?

I don't think our short-term debt is getting too thick. You can see from our financial statements, we're in a pretty comfortable spot. But, over time, I think it's just a nice place to be to have that capacity. If we were to get an award, we don't know that we're going to get an award, but if we were to get an award and of any substantial size, I think we'll provide another layer of certainty or cushion as we build out our capital program. Michael Lapides - Goldman Sachs & Co.: Okay. And then last thing just related to that, if you get an award, is that taxable?

Yes. Michael Lapides - Goldman Sachs & Co.: So, whatever the number is that comes back to SCE, what you're really getting is 60%, 65% of that level?

Yeah, whatever the... Michael Lapides - Goldman Sachs & Co.: Tax rate is.

...final tax rate would be. Yes. Michael Lapides - Goldman Sachs & Co.: Okay, got it. Thank you, guys. Much appreciate it.

Thanks, Michael.

Thank you. And our next question is from the line of Ali Agha of SunTrust. Your line is open.

Thank you.

Hey, Ali.

Hey, Pedro. First question, Pedro, you've been obviously implementing the SONGS settlement as per the terms of the settlement for a while now. And so, from a practical point of view, if the Commission decided to reopen it, can we sort of put that genie back in the bottle, given how far down the road we've already come? How does that work conceptually if this thing were reviewed?

So, you're talking about the genie in the bottle. We've talked about it'd be tough to unscramble the egg or put the toothpaste back in the tube. So, I think that would be one of the challenges were the Commission to decide to reopen the settlement. And of course, if they did that, we believe strongly in the litigation positions that we had and we would reassert those. But, no, you're pointing out one of the implementation challenges, if the Commission were to reopen it, would be very tough to do. And as I mentioned in my comment, we've refunded or are on the way to refunding a total $1.6 billion, so a big amount at stake here benefiting customers.

Yeah. Second question. When you're benchmarking your cost versus your relevant peer group where do you see yourself standing? Which quartile right now? And really the thrust being that for the last couple of rate case cycles, in particular, you've been able to benefit from the non-rate case years by coming in with better cost and keeping that upside. How much more is left in that process when you benchmark yourselves and see where you stand today?

So I want stay pretty high level on this one. I'd say we're probably in the middle of the pack. Some areas a little better, some areas a little worse. We've pointed investors to our rate case filing and the pieces that we had some level of confidence on, when we were filing our rate case, of course, we put in the rate case as an obligation for customers. We said that we'll continue to work at this. We have not quantified for investors what that additional opportunity is or the timing for it, probably because we're continuously doing that work, Ali, and that's a work in progress. The other comment I make there is, beyond just looking at what it means for SCE today to benchmark itself against the folks who are in the quartile already or even best-in-class that versus where I think the whole industry and, frankly, the whole economy is set at, certainly, over the decade ahead for us here, technology is going to be opening up some pretty powerful opportunities to reshape how a lot of American work is done. And I think even the folks who are best-in-class in our industry or in other industries are going to see continued opportunities for improvement, whether it's back office technologies or artificial intelligence or the impact of other hardware and software in various parts of our business, I just see that as a continuing opportunity for all of us in the industry and across the economy. And so, I don't think we're at the point yet where we stop. So, expect there could be a continuing theme for us, but we haven't quantified what that could mean yet.

Understood. Pedro, One last question, I'm sorry, if I could. You may have different valuation benchmarks on how you're looking at the Edison Energy businesses, obviously, different businesses. But, as you know, your stock trades on a PE multiple, so earnings matter. So, in that context, how sensitive is it for you to at least get those businesses to break-even on earnings, so you're not getting penalized as I believe you are by those losses flowing through your earnings statements?

Thanks for the question, Ali, and I'll kick it off and Maria might have other thoughts. You're right. I think that EIX does trade largely on SCE earnings. That is the core of the business. And today, the Edison Energy Group activities are non-material relative to the broad EIX story. We are excited about the opportunity. As I mentioned earlier, we are sensitive. Recognize that investors look at earnings in PE and as we develop that business plan that we'll share over the next 12 months, our goal is to make that as transparent as possible because we recognize that we have a responsibility here to explain that business case to investors and make it one that you all can get your arms around. In the specific case of Edison Energy, this is getting a little ahead of our skis this year. But just to provide a little bit of color, we view that as an energy as a service kind of business. The business that we have today, basically, have a number of customers, contracts that can span from one to several years. We'd expect that to be a book of business that we could describe to our investors and provide metrics around the texture of that portfolio – the tenure of it – what contract volumes or what years, measures of backlog, et cetera. But at the end of the day, we would hope and would expect would provide some good level of confidence around continuing cash flow strength, continuing earnings strength. So, I just described something at pretty high level here. Expect us to put more pen to paper as we develop the business plan and share it with you. But we're thinking about that in that way and, frankly, in large part because of the good feedback we've gotten from a number of you about how to reconcile new businesses with the core story and how the core story is valued at EIX and at SCE. Maria, anything to add, or?

No, I don't think so. I think you captured it.

Thank you.

Thanks, Ali.

Thank you. And our next question is from the line of Anthony Crowdell of Jefferies. Your line is open.

Good afternoon. First, Pedro and Maria, huge improvement over the last couple of calls. Just...

We're not going to touch that.

We can hear Scilacci's voice breaking in.

If I could just touch on, I think, one of the earlier questions from Jonathan about the equity ratio, I understand you like the flexibility. You talk about dividend growth and everything else. But when you go from a 48% to 50% equity ratio on the rate base that you guys have, it's a significant driver of earnings. And if the Commission is able to give you that flexibility, why not look to setting it at 50% and still enjoy that flexibility? Because right now, it looks like you're losing $0.18 to $0.20 of earnings.

So, thanks for the question. And we are comfortable at the place we are right now, 48% authorized. Yes, we're a little higher than that at the current moment. But that will work down over time as we continue to expand our capital program. I think that flexibility is really important. We're trying to balance a lot of things in the context of, we want to be able to deploy the capital that we need to get the grid modernized, to focus on safety and reliability, all the things that our customers need, and then also balance that against customer rates as well. So, we're doing a lot of things. The 48% level authorized equity rate actually does fit in with the overall objectives that we're trying to achieve. And we think that it provides us with the right amount of flexibility over time.

Could you use the parent company to also provide flexibility or you're just really looking at flexibility at the utility? I'm thinking maybe the parent could provide some additional equity to the utility if you had a huge capital program?

Certainly, EIX has some balance sheet flexibility. I think we'd have to think about that over time in terms of where would be the most appropriate place to provide that sort of backing.

Great. Thanks for taking my question.

Thanks.

Thank you. And our next question is from the line of Travis Miller of Morningstar. Your line is open.

Good afternoon. Thank you.

Hi, there.

I was wondering, obviously, all these initiatives going on in California, smart grid and all the other stuff, storage, transmission, even those delays there, how much is the timing of the GRC decision dependent on any of those things happening along their various timelines?

Do you mean from a process and staff workload perspective or...?

In terms of your investment proposal and the Commission's various needs to approve various types of initiatives?

I think that the answer is, for the most part, we look at these as fairly separate tracks. We might have a – there's just a number of – or a portion of our revenue requirement and our programs, a large portion that flows through the general rate case. There are individual special purpose programs like Charge Ready, which is going through a separate track. And so, those are fairly independent. Perhaps, the one point of more interaction that's still being defined is around the whole topic of grid modernization. I think it's fair to say that in the beginning when the Commission first set up the distribution resource plan proceeding or DRP, that was intended to provide policy-level guidance that would then feed into the requests of each utility in their general rate cases. We do have a unique situation with SCE's rate case in that, just the timing of our rate case is such that we have to file a request before we have a final decision in the DRP proceeding. The Commission has recognized that and so some interaction there, but in the meantime, we are very focused on providing the testimony and high quality testimony in the GRC proceeding. And again, we're encouraged by the comments that President Picker made about wanting to stay on the overall timelines. Looking at Kevin Payne and Ron Nichols in case you have anything to add there or if I covered that?

I would add that – this is Ron Nichols. I would add that the Commission in their DRP proceeding just gave guidance here recently that in Q2 of 2017 that they expect to provide some more guidance on grid modernization investment levels. So, we're expecting that will give us a better clue, we hope reinforcement with regard to where we're headed. But that at least identifies the fact we've asked for memorandum account for this and they're now finally coming out with some timeline for some guidance.

Okay, very helpful. Thank you.

Okay. Thank you.

Thank you. And our next question is from the line of Lason Jong of Avila Research Consulting (57:47). Your line is open.

Thank you. Good afternoon.

Hi, Lason (57:54).

Hi. I was just running through your numbers on the greenhouse gas emissions. And I've come to a very interesting conclusion, which is that the opportunity for investments in the electric grid infrastructure around electric vehicles is stunningly high. Meaning 40% greenhouse gas emissions from power plants have to get cut in half by law, so that 10% of the 40%, let's assume industrials contribute another 10% out of the 40% and commercial customers contribute 5%, maybe 10% max. That means 15% of that 40% has to come from the transportation area. And rough numbers suggest that 10 million cars being taken off the road, which means several things. One; a massive increase in power generation, most likely on the renewable side. And two; massive transmission and distribution line expansion and massive infrastructure investment in electrical vehicle charging stations. Am I in the ballpark?

So, I think you just defined one potential scenario, but I think there are many. And the reality is that the state is just starting to get its arms around how this all really will shake out. And I'll tell you, some of the interesting questions here are, how much of this will be done by the state going through the kind of analysis that you just went through there. And in allocating that out on a sector by sector basis, how much of it will be done by relying on more market forces and seeing how the markets bring out the best opportunities. So, I'll probably stop short of commenting on your specific scenario there. But, really, come back to the basic message, which is no matter which way we cut it – and we're doing our own homework on this right now with our various state agencies. But no matter which way we cut it, we see electrification of a lot of the economy being absolutely needed. Now, whether it's you're quick math there in terms of the impact on transportation, some of the factors or whether it's different math, different proportions coming from different sectors. Even within transportation, how much comes from passenger light duty vehicles, how much comes from heavier duty. I think there's lots of questions that the state needs to grapple with. But, again, any which you cut it, it will require a fair amount of electrification. And therefore, really cement the absolute necessity of having a strong and modern grid at the center of it all to move that power around. So that's the focus and I think we will all be learning a lot over the course of the next few years here as we march our way to the state being able to meet the expectation of the law 14 years from now.

When do you think the state is going to have some sort of an implementation plan to be able to get to the numbers by 2030?

Hope its sooner rather than later, but I don't think that we've seen any specific dates come out of some of the key agencies here. Ron Nichols, anything you'd add there?

I think there is one thing I would point to at least that the Public Utilities Commission has come up with a request back middle of September, came out with a ruling to have all three of the investors on utilities make a filing January 20 of 2017 on our ideas with regard to what could be done both in programs and investments to accelerate transportation electrification. That's only one piece admittedly. But there is – at least there is, from that end, a push towards doing that. And they've asked us to be pretty out of the box thinking with regard to this and that will create opportunities potentially for investment. And whether we make the investment or other parties make that investment, greater increase in use of our grid and benefit of spreading those costs over a higher amount of kilowatt hour sales. As to the larger scale, the California Resources Board is still working on a longer-term plan that includes all the other sectors, but they don't have a hard timing on that yet.

Lot of work to be done in the state.

Okay. That was the last question. I will now turn the call back to Mr. Scott Cunningham.

Thanks, Christie. And thanks, everyone, for participating and don't hesitate to give us a call if you have any questions and we'll look forward to seeing many of you at the EI Financial Conference next week. Good evening.

And that concludes today's conference. Thank you all for participating. You may all disconnect.