EXECUTIVE SUMMARY
? SoCal Conference Call Highlights

SoCal Conference Call- The following comments are notes from the SoCal 
conference call for defaulted debt holders, held 1:30 p.m. PDT, 13 July 2001:

? Ted Kravner, the SoCal spokesperson, indicated that there are "a lot of 
bills floating around.  There's not a lot for us to say at this point."  
After such a long delay, he stated that, "We are encouraged to see real 
action at the legislative level."  Also, the company could not comment as to 
whether the plans made the utility creditworthy; "We are evaluating that with 
Senate and Assembly leaders."

? The spokesperson stated that on Monday the company will make a regular 
interest payments on the 5 7/8 notes totaling less than $6 M.  The company 
will also make payments on its other notes; the total amount to be paid will 
be $27 to $28 M.

? Yesterday the CPUC granted the company's motion on the QF fixed rate 
agreement with the gas cogen and renewable QFs.  The spokesperson stated that 
the PUC said SoCal can recover all costs associated with its payments to 
these QFs.


 Appalucia Management Questions to SoCal
 Q:   Will SCE defer payment on the "quids" notes, which are backed by a 
trust that has bonds issued against it?
 A:  Under the terms of the notes SoCal is allowed to defer payment for up to 
20 quarters.

 Q: Would the CPUC, after providing for the DWR to be reimbursed for 
purchasing power (through the California Procurement Adjustment, or CPA), 
leave enough revenue for SoCal to remain solvent?  This was based on reports 
in the press recently that the DWR had requested a 25% rate increase.  
 A: These reports were "speculation" and were based on numbers that DWR had 
submitted several weeks ago.  SoCal stated that DWR must update these 
numbers; therefore, no formal CPUC decision on reimbursing SoCal vis-.-vis 
DWR can be made at this time.  SoCal indicated that these numbers would be 
updated "in a few weeks."

 Prudential Questions to SoCal
 Q:  What bills are currently in process dealing with the MOU?
 A: There is the Polanco bill, which is the original MOU; the  Assembly 
(Hertzberg) bill AB 82XX, which uses the Polanco bill as its foundation; and 
a Senate bill crafted around Byron Sher's proposals.  SoCal stated that the 
Sher bill was "less a matter of using Polanco" and approaches the MOU "from a 
different direction."  SoCal indicated that "people are currently studying 
the Hertzberg will to see what the components are."

 Q: What is your (SoCal's) reaction to the negative article in the LA Times 
today regarding the legislature's perception of the MOU?  
 A: SoCal responded that "the LA Times sees the glass as half-empty.  By my 
comments, I see the glass as half-full.  We are optimistic because there 
something tangible that people are working on.  The fact that Hertzberg's 
bill uses the governor's MOU as a foundation provides us with a level of 
optimism."  However, he emphasized that the company was not in a position to 
say whether any of the bills would make the utility creditworthy.  

 Q: Can the governor keep the legislature from recessing in order to force 
them to pass an MOU?
 A: SoCal responded, "yes, I understand that he does have that power.  We are 
running out of days.  The situation is becoming more critical.  We are on 
borrowed time from our creditors now.  Anything that moves us toward 
creditworthiness, we support."  (NOTE:  In actuality, the Governor can order 
legislators to the floor for a vote, but they do not have to comply.  As 
Burton said in the press today, "Only the legislature can force the 
legislature to stay.")

Deutsche Bank Questions to SoCal
 Q: Is the transmission asset sale off the table or not?  
 A: The sale is in the Assembly bill, but we "think it's more of an option in 
the Senate bill, like it was in the San Diego deal."

 Q: What are your (SoCal's) thoughts on how the California Procurement 
Adjustment (CPA) mechanism could be constructed to keep SoCal solvent and if 
a change in the mechanism for reimbursing the DWR would be needed?
 A:   "We are highly focused on this."  The spokesperson stated that if  
revenue is distributed in a manner "that puts the utility in a deteriorating 
balance sheet situation, this will be seen as a very serious situation.  This 
would be unacceptable.  Our cash position is currently stable.  These 
changes, this would be a very serious event."

 Q: Has SoCal reached an agreement on paying the non-renewables or gas-fired 
QFs 10% of what they are owed? 
 A: SoCal indicated that it is still in negotiations with 4 of the larger 
gas-fired QFs (IEP Projects).  SoCal indicated that it would make its 10% 
payments once the PUC order to pay is final (a 30-day appeal period is still 
in effect, according to SoCal).