930835--3/1/2010--EDISON_MISSION

related topics

{debt, indebtedness, cash}

{cost, regulation, environmental}

{loss, insurance, financial}

{acquisition, growth, future}

{competitive, industry, competition}

{gas, price, oil}

{operation, natural, condition}

EME is subject to extensive environmental regulation and permitting requirements that may involve significant and increasing costs. The controls imposed on the Midwest Generation plants as a result of the CPS may require material expenditures or unit shutdowns. EME is subject to extensive energy industry regulation. EME has substantial interests in merchant energy power plants which are subject to market risks related to wholesale energy prices. EME's financial results can be affected by changes in fuel prices, fuel transportation cost increases, and interruptions in fuel supply. EME may not hedge market risks effectively. Competition could adversely affect EME's business. The accounting for EME's hedging and proprietary trading activities may increase the volatility of its quarterly and annual financial results. EME may not be able to raise capital on favorable terms, which could adversely affect its results of operation. EME and its subsidiaries have a substantial amount of indebtedness, including long-term lease obligations. EME conducts a substantial portion of its operations through its subsidiaries and may be limited in its ability to access funds from these subsidiaries to service its debt. Restrictions in the instruments governing EME's indebtedness and the indebtedness and lease obligations of its subsidiaries limit EME's and its subsidiaries' ability to enter into specified transactions that they otherwise might enter into. The interests of Edison International as EME's equity holder may conflict with the interests of holders of debt. EME's development projects or future acquisitions may not be successful. EME's projects may be affected by general operating risks and hazards customary in the power generation industry. EME may not have adequate insurance to cover all these hazards. The creditworthiness of EME's customers, suppliers, transporters and other business partners could affect EME's business and operations.

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930835--3/1/2010--EDISON_MISSION_ENERGY