Los Angeles, California part of Souther California Edison’s Service Territory
(May 5, 2021) Southern California Edison Company has engaged Saber Partners as a Financial Advisor on the Utility’s Potential $1 Billion Securitization Bond Offering
The California utility Southern California Edison (SCE) seeks to raise nearly $1 billion in a bond offering that will achieve the lowest cost and the maximum savings possible for its customers.
After requiring extensive responses to a detailed “Request for Proposals” (RFP), Southern California Edison selected Saber Partners, LLC as one of two financial advisors. The RFP focused on experience and the use of securitization for “Capital Expenditures, Related Operational and Maintenance Expenses, and AB 913 COVID-19 Pandemic Related Costs.”
Saber Partners will provide SCE comprehensive advisory services for the regulatory process and the structure, marketing, and pricing of SCE’s next securitization offering.
The transaction will be SCE’s second utility securitization bond offering as allowed under recently enacted legislation in California. The proceeds will pay for previously incurred wildfire mitigation and COVID-related costs.
Between 2018-2020, the California legislature passed several laws to authorize the use of utility securitization financings to pay for certain extraordinary utility costs. The securitized bonds will mean lower rates for customers for the funding of certain qualified costs. SCE completed its first securitized bond financing under the new AB1054 law in February 2021.
16th Utility Securitization Assignment; 16 Bond Offerings; $11 billion
The SCE engagement marks Saber Partners’ 16th utility securitization bond assignment in this highly specialized market. In 2021, Saber Partners will have been an advisor on over $11 billion in securities – 20% of the entire market. This is more transactions for a greater principal amount than any other independent advisory firm.
Saber Partners recently completed an assignment as the financial advisor to the North Carolina Utilities Commission Public Staff concerning nearly $1 billion in ratepayer-backed bonds. These bonds will lower the cost to Duke Energy Carolina and Duke Energy Progress customers for repairing the utility’s grid damaged from recent hurricanes. The North Carolina Utilities Commission issued its financing order on May 10, 2021. The Commission’s financing order adopted almost all of Saber Partners era “best practice” recommendations.
Saber has been the advisor to Pearl Street Finance Lab and the Energy Foundation on utility securitization. The Foundation is assisting environmental advocates in understanding and promoting the use of securitization – with appropriate ratepayer protections – as a financing tool for the early retirement of coal-fired plants. The need to replace these plants is becoming increasingly important because of climate change.
The Choice of Regulators and Utilities Nation-Wide
Saber’s clients have consistently praised the firm’s efforts to achieve the lowest cost to electricity customers from this special type of financing. Saber’s clients have included:
- Florida Public Service Commission
- Public Utility Commission of Texas
- West Virginia Public Service Commission
- New Jersey Board of Public Utilities
- Public Service Commission of Wisconsin
- DC Office of People’s Counsel
For further information on Saber Advisory services, contact Joseph S. Fichera, Chief Executive Officer at 212-461-2370 or email jfichera@saberpartners.com
