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Revenue
 9 Months Ended
Sep. 30, 2019
Revenue from Contract with Customer [Abstract]  
Revenue Revenue
SCE's revenue is disaggregated by two revenue sources:
•
Earning activities – representing revenue authorized by the CPUC and FERC, which is intended to provide SCE a reasonable opportunity to recover its costs and earn a return on its net investment in generation, transmission, and distribution assets. The annual revenue requirements are comprised of authorized operation and maintenance costs, depreciation, taxes, and a return consistent with the capital structure. Also, included in earnings activities are revenue or penalties related to incentive mechanisms, other operating revenue, and regulatory charges or disallowances.
•
Cost-recovery activities – representing CPUC- and FERC- authorized balancing accounts, which allow for recovery of specific project or program costs, subject to reasonableness review or compliance with upfront standards. Cost-recovery activities include rates which provide recovery, subject to reasonableness review of, among other things, fuel costs, purchased power costs, public purpose related-program costs (including energy efficiency and demand-side management programs), and certain operation and maintenance expenses. SCE earns no return on these activities.
The following table is a summary of SCE's revenue:
 
Three months ended September 30, 2019
Three months ended September 30, 2018
(in millions)
Earning
Activities
Cost-
Recovery
Activities
Total
Consolidated
Earning Activities
Cost-Recovery Activities
Total Consolidated
Revenues from contracts with customers1,2,3
$
1,862

$
2,022

$
3,884

$
1,851

$
2,255

$
4,106

Alternative revenue programs and other operating revenue4
$
(30
)
$
(122
)
$
(152
)
$
(74
)
$
228

$
154

Total operating revenue
$
1,832

$
1,900

$
3,732

$
1,777

$
2,483

$
4,260

 
Nine months ended September 30, 2019
Nine months ended September 30, 2018
(in millions)
Earning
Activities
Cost-
Recovery
Activities
Total
Consolidated
Earning Activities
Cost-Recovery Activities
Total Consolidated
Revenues from contracts with customers1,2,3
$
4,896

$
3,746

$
8,642

$
4,921

$
4,593

$
9,514

Alternative revenue programs and other operating revenue4
$
23

$
683

$
706

$
(96
)
$
199

$
103

Total operating revenue
$
4,919

$
4,429

$
9,348

$
4,825

$
4,792

$
9,617

1 
In the absence of a 2018 GRC decision, SCE recognized CPUC revenue in 2018 and the three months ended March 31, 2019 based on the 2017 authorized revenue requirement adjusted mainly for the July 2017 cost of capital decision and Tax Reform. SCE recorded the impact of the 2018 GRC final decision in the second quarter of 2019, including a $265 million reduction in revenue. The 2018 GRC final decision results in 2018 and 2019 base rate revenue requirements of $5.116 billion and $5.451 billion, respectively. For further information, see Note 1.
2 
At September 30, 2019 and December 31, 2018, SCE's receivables related to contracts from customers were $1.5 billion and $1.1 billion, respectively, which include accrued unbilled revenue of $638 million and $482 million, respectively.
3  
Includes SCE's franchise fees billed to customers of $42 million and $48 million for the three months ended September 30, 2019 and 2018, respectively, and $95 million and $104 million for the nine months ended September 30, 2019 and 2018, respectively.
4 
Includes differences between amounts billed and authorized levels for both CPUC and FERC.