Moody's downgrades Edison

Moody's Investors Service said it downgraded Edison International's ratings, including its senior unsecured rating to Baa3 from Baa1 and the ratings of its principal subsidiary, Southern California Edison Co., including its senior unsecured rating to Baa2 from A3.

Moody's also said it downgraded Edison's short-term ratings for commercial paper to P-3 and affirmed Southern California Edison at P-2.

The outlooks on both companies are negative.

This concludes a review that began in January, the agency noted.

The downgrades reflect the potential for multi-billion dollar exposure related to wildfire risk that is unique to investor-owned utilities in California, Moody's explained.

The ratings on both companies could fall further if California fails to pass legislation or enact regulatory changes that substantively mitigates the financial impact of wildfires on Southern California Edison by the end of this year's California legislative session in the third quarter of 2019, the agency said.

The ratings could also be affected by if the utility experiences additional large fires, Moody's said.

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