According to documents that Southern California Edison provided to state officials, the utility forwarded hundreds of millions in tax payments every year to its parent, Edison International. SCE provides power to more than 10 million customers, most of them in Southern California.

Yet, Edison International shifted most of that money to some of its money-losing operations in other states. For example, the documents show, in 1998 SCE forwarded $431 million for taxes to Edison International—but Edison International paid only $1 million to the state and federal governments because the remaining $430 million was largely spread among its money-losing operations in other states.

The SCE records show it paid $291 million last year to its parent to cover its share of taxes. Yet, Edison International paid nothing at all in state and federal corporate taxes. The documents "hit some of us like a bombshell," one legislator told reporters after Friday's hearings.

California is currently spending about $45 million a day in taxpayer money to purchase power because its two biggest utilities--Southern California Edison and Pacific Gas & Electric—say they can't afford to buy the power themselves. Many lawmakers are furious that only a fraction of the money forwarded by SCE to its parent ever made it to the state Treasury, but Edison International CEO John Bryson testified Friday that shifting the revenue to other subsidiaries "was absolutely in compliance with the tax laws" and rules established by California's Public Utilities Commission.