SOUTHERN CALIFORNIA EDISON CoSCE-PG

SOUTHERN CALIFORNIA EDISON Co PP&E Disclosure

10-KFiled Feb 25, 20212 min read
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)20202019
Distribution$28,663 $26,929 
Transmission15,669 14,720 
Generation3,709 3,664 
General plant and other5,129 4,583 
Accumulated depreciation(10,681)(9,958)
42,489 39,938 
Construction work in progress5,033 4,131 
Nuclear fuel, at amortized cost131 129 
Total utility property, plant and equipment$47,653 $44,198 
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, primarily ranging from 5 to 7 years and commencing upon operational use. Capitalized software costs, included in general plant and other above, were $1.2 billion and $1.0 billion at December 31, 2020 and 2019, respectively, and accumulated amortization was $0.6 billion and $0.4 billion, at December 31, 2020 and 2019, respectively. Amortization expense for capitalized software was $218 million, $190 million and $198 million in 2020, 2019 and 2018, respectively. At December 31, 2020, amortization expense is estimated to be $213 million, $168 million, $136 million, $82 million and $30 million for 2021 through 2025, respectively.
Jointly Owned Utility Projects
SCE owns undivided interests in transmission and generating assets for which each participant provides its own financing. SCE's proportionate share of these assets 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.
The following is SCE's investment in each asset as of December 31, 2020:
(in millions)Plant in ServiceConstruction Work in ProgressAccumulated
Depreciation		Nuclear Fuel
(at amortized cost)		Net Book ValueOwnership
Interest
Transmission systems:
Eldorado$324 $74 $39 $— $359 79 %
Pacific Intertie346 — 74 — 272 50 %
Generating station:
Palo Verde (nuclear)2,113 53 1,609 131 688 16 %
Total$2,783 $127 $1,722 $131 $1,319 
In addition, SCE has ownership interests in jointly owned power poles with other companies.

Historical Timeline

Fiscal YearFiled
2020Feb 25, 2021Showing above
2019Feb 27, 2020
2018Feb 28, 2019
2017Feb 22, 2018
2016Feb 21, 2017

About PP&E Disclosures

The PP&E disclosure details a company's physical asset base — land, buildings, machinery, and equipment — along with the depreciation methods and useful life assumptions that determine how these costs flow through the income statement. Capitalization policy thresholds reveal management's judgment on the boundary between expense and asset, directly affecting both reported earnings and asset values.

Key signals: changes in estimated useful lives or depreciation methods can materially shift reported earnings without any operational change. Compare capital expenditures against depreciation expense — when capex consistently trails depreciation, the asset base may be aging and underinvested. Watch for large asset impairments or write-downs that signal overvalued carrying amounts. Asset retirement obligations reveal future environmental or decommissioning costs that are often underappreciated. Compare PP&E intensity (PP&E-to-revenue) against industry peers to assess capital efficiency and competitive positioning.

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