Edison executives’ secret spending

Edison employees rack up millions in business expenses

The highest-paid 10 percent of Southern California Edison employees earned at least$418.8 million in combined total compensation during 2011, and charged at least $11.8 million to their expense accounts, according to a report the public utility filed with the state.

SCE’s most recent annual report showed 19 executives and other SCE employees received more than $1 million in total compensation during 2011, and at least 130 others received$300,000 or more in total compensation. The 2,094 employees who made at least $125,000(but less than $250,000) in base salary racked up a combined $10.5 million in business expenses.

Four of the employees charged more than$100,000 to their business expense accounts, with the top spender, identified only as “Manager 3,” charging $192,402, according to the report. The median expense total for the 2,094 employees was$3,358.

What specific items employees and executives charged to their accounts is anyone’s guess—at least right now—because SCE declined to provide documentation or details of spending. Instead, SCE officials provided general comments in a written statement.

“Sometimes employee-related business expenses are incurred and charged to credit cards for a group of individuals or a department, including the expenses charged by the individuals who have been identified,” the statement said. “These charges are reported under the employee responsible for the company issued credit card. Charges are recorded to either ratepayer or shareholder accounts, based on the business activity for which it is incurred.”

SCE officials did not say which expenses charged by individual employees reflected business expenses for other employees, nor did they say which expenses—or what percentage of expenses—were charged to shareholder accounts.

Ratepayer advocates said the reports suggest some SCE employees may be living the high life at ratepayers’ expense.

“Overall, when you look at this you have the sense of a company that is living high on the hog,” said Mindy Spatt, spokeswoman for nonprofit ratepayer advocate group, The Utility Reform Network, or TURN. “Their executives have huge salaries and huge expense accounts.”

“The majority of the money these highly paid executives are getting comes right out of ratepayers’ pockets,” Spatt said. “Most of their expenses are billed to ratepayers, too.”

SCE ratepayers covered most or all of the employees’ compensation and expenses, according to documents the utility filed with the state. And ratepayers kicked in part of the total compensation for a handful of executives shared by SCE and related companies—including the top official at SCE’s parent company, Edison International, who received$10.8 million in 2011 and charged $334,272 to his expense account.

Peter Thomas Dietrich, senior vice president and chief nuclear officer responsible for overseeing SCE’s nuclear business at the San Onofre Nuclear Generating Station, received $1,291,869 in total compensation in 2011, according to the report. His total compensation included a performance-based annual bonus of $288,264.

Not included in Dietrich’s total compensation was a $350,000 hiring bonus, a $75,000housing stipend, a moving and mileage expense payment of $342,910, and $89,624 in charges to his expense account, the report said. With total compensation, that all adds up to about $2 million (not including business expenses).

Dietrich replaced Ross Ridenoure, who left his post for the good of the station afterallegations of deep distrust between some employees and management at the plant surfaced in 2010.

Ridenoure received a cash severance payment of $581,095 upon his departure, as well as$31,702 in relocation expenses, according to SCE’s 2010 compensation report. Neither figure was included in his total compensation, which could not be determined based on the figures listed in the report because his name was redacted.

Two unnamed employees with the “SVP and Chief Nuclear Officer” title were listed as employees who retired, were fired, died, or were taking a leave of absence in 2010, according to SCE’s 2010 compensation report. The employees received total compensation of $283,824 and $2,557,014, respectively.

The numbers appear in reports SCE and other California utility companies must file annually with the California Public Utilities Commission. The reports, which show total compensation and business expenses for executives and employees who received more than $125,000 in base salary during the year the report covers, provide transparency and information for officials to consider when deciding whether a rate increase is justified.

The commission does not collect or routinely audit business expenses, but ratepayer advocacy groups sometimes request the information and perform audits when utilities apply for the state’s permission to raise rates. It did not appear that any groups audited business expenses when SCE applied for rate increases starting in 2012.

Spatt said the advocacy groups’ audits include checks to make sure shareholders are covering lobbying expenses and other costs that cannot be billed to ratepayers.

Top-spenders in the $125,000-base-compensation-bracket in 2010 were:

  • Manager 3 ($184,574 in total compensation)—$434,055 in expenses. The median expense total for the 274 employees identified in the report with a “Manager 3″ job title was $4,791. An SCE spokesman said the employee’s expenses included expenses for other employees. The spokesman would not say how many other employees’ expenses were included in the total.
  • Mgr-Project/Product 2 ($143,554 in total compensation)—$290,032 in expenses. The median expense total for the 338 employees identified in the report with a “Mgr-Project/Product 2″ job title was $2,631.
  • Mgr-Project/Product 2 ($149,729 in total compensation)—$144,778 in expenses.
  • Manager 2 ($140,525 in total compensation) – $89,070 in expenses. The median expense total for the 471 employees identified in the report with a “Manager 2″ job title was $3,814.
  • Mgr-Project/Product 2 ($147,415 in total compensation)—$83,150 in expenses.

Top spenders in the $125,000-base-compensation-bracket were in 2011 were:

  • Manager 3 ($223,085 in total compensation)—$192,402 in expenses. The median expense total for the 290 employees identified in the report with a “Manager 3″ title was$5,118.
  • Manager 2 ($163,927 in total compensation)—$115,804 in expenses. The median expense total for the 503 employees identified in the report with a “Manager 2″ title was$3,222.
  • Mgr-Project/Product 2 ($154,891 in total compensation)—$110,407 in expenses. The median expense total for the 404 employees identified in the report with a “Mgr-Project/Product 2″ job title was $2,520.
  • Mgr-Project/Product 2 ($153,978 in total compensation)—$100,707 in expenses.

SCE serves 4.9 million customers in a 50,000-square-mile service area within central, coastal and Southern California, including much of Orange County. Southern California Edison’s forecasted revenue requirement—the money the company needs to bring in in order to operate—was $6.3 billion, according to SCE’s most recent application for a rate increase.

The company expected to employ 18,543 workers in 2012, according to the rate application. The majority of the employee’s wages and benefits—about 80 percent—were funded with money from ratepayers.