|
||||||||||||
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
|
||||||||||||
FORM 10-Q
|
||||||||||||
(Mark One)
|
||||||||||||
[X]
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|||||||||||
For the quarterly period ended
|
September 30, 2015
|
|||||||||||
or
|
||||||||||||
[ ]
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|||||||||||
For the transition period from
|
to
|
|||||||||||
|
||||||||||||
Commission File No.
|
Exact Name of Registrants as Specified in their Charters, Address and Telephone Number
|
States of Incorporation
|
I.R.S. Employer
Identification Nos.
|
Former name, former address and former fiscal year, if changed since last report
|
||||||||
1-14201
|
SEMPRA ENERGY
|
California
|
33-0732627
|
No change
|
||||||||
488 8th Avenue
|
||||||||||||
San Diego, California 92101
|
||||||||||||
(619)696-2000
|
||||||||||||
1-03779
|
SAN DIEGO GAS & ELECTRIC COMPANY
|
California
|
95-1184800
|
No change
|
||||||||
8326 Century Park Court
|
||||||||||||
San Diego, California 92123
|
||||||||||||
(619)696-2000
|
||||||||||||
1-01402
|
SOUTHERN CALIFORNIA GAS COMPANY
|
California
|
95-1240705
|
No change
|
||||||||
555 West Fifth Street
|
||||||||||||
Los Angeles, California 90013
|
||||||||||||
(213)244-1200
|
||||||||||||
Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.
|
||||||||||||
Yes
|
X
|
No
|
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
|
||||||||||||
Sempra Energy
|
Yes
|
X
|
No
|
|||||||||
San Diego Gas & Electric Company
|
Yes
|
X
|
No
|
|||||||||
Southern California Gas Company
|
Yes
|
X
|
No
|
|||||||||
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
|
||||||||||||
Large
accelerated filer
|
Accelerated filer
|
Non-accelerated filer
|
Smaller reporting company
|
|||||||||
Sempra Energy
|
[ X ]
|
[ ]
|
[ ]
|
[ ]
|
||||||||
San Diego Gas & Electric Company
|
[ ]
|
[ ]
|
[ X ]
|
[ ]
|
||||||||
Southern California Gas Company
|
[ ]
|
[ ]
|
[ X ]
|
[ ]
|
||||||||
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
|
||||||||||||
Sempra Energy
|
Yes
|
No
|
X
|
|||||||||
San Diego Gas & Electric Company
|
Yes
|
No
|
X
|
|||||||||
Southern California Gas Company
|
Yes
|
No
|
X
|
|||||||||
Indicate the number of shares outstanding of each of the issuers’ classes of common stock, as of the latest practicable date.
|
||||||||||||
Common stock outstanding on October 28, 2015:
|
||||||||||||
Sempra Energy
|
248,210,449 shares
|
|||||||||||
San Diego Gas & Electric Company
|
Wholly owned by Enova Corporation, which is wholly owned by Sempra Energy
|
|||||||||||
Southern California Gas Company
|
Wholly owned by Pacific Enterprises, which is wholly owned by Sempra Energy
|
|||||||||||
SEMPRA ENERGY FORM 10-Q
SAN DIEGO GAS & ELECTRIC COMPANY FORM 10-Q
SOUTHERN CALIFORNIA GAS COMPANY FORM 10-Q
TABLE OF CONTENTS
|
||
Page
|
||
Information Regarding Forward-Looking Statements
|
4
|
|
PART I – FINANCIAL INFORMATION
|
||
Item 1.
|
Financial Statements
|
6
|
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
82
|
Item 3.
|
Quantitative and Qualitative Disclosures About Market Risk
|
126
|
Item 4.
|
Controls and Procedures
|
127
|
PART II – OTHER INFORMATION
|
||
Item 1.
|
Legal Proceedings
|
128
|
Item 1A.
|
Risk Factors
|
128
|
Item 6.
|
Exhibits
|
128
|
Signatures
|
130
|
|
§
|
local, regional, national and international economic, competitive, political, legislative and regulatory conditions and developments;
|
§
|
actions and the timing of actions, including issuances of permits to construct and licenses for operation, by the California Public Utilities Commission, California State Legislature, U.S. Department of Energy, Federal Energy Regulatory Commission, Nuclear Regulatory Commission, Atomic Safety and Licensing Board, California Energy Commission, U.S. Environmental Protection Agency, California Air Resources Board, and other regulatory, governmental and environmental bodies in the United States and other countries in which we operate;
|
§
|
the timing and success of business development efforts and construction, maintenance and capital projects, including risks in obtaining, maintaining or extending permits, licenses, certificates and other authorizations on a timely basis and risks in obtaining adequate and competitive financing for such projects;
|
§
|
energy markets, including the timing and extent of changes and volatility in commodity prices, and the impact of any protracted reduction in oil and natural gas prices from historical averages;
|
§
|
the impact on the value of our natural gas storage assets from low natural gas prices, low volatility of natural gas prices and the inability to procure favorable long-term contracts for natural gas storage services;
|
§
|
delays in the timing of costs incurred and the timing of the regulatory agency authorization to recover such costs in rates from customers;
|
§
|
deviations from regulatory precedent or practice that result in a reallocation of benefits or burdens among shareholders and ratepayers;
|
§
|
capital markets conditions, including the availability of credit and the liquidity of our investments;
|
§
|
inflation, interest and currency exchange rates;
|
§
|
the impact of benchmark interest rates, generally Moody’s A-rated utility bond yields, on our California Utilities’ cost of capital;
|
§
|
the availability of electric power, natural gas and liquefied natural gas, and natural gas pipeline and storage capacity, including disruptions caused by failures in the North American transmission grid, pipeline explosions and equipment failures and the decommissioning of San Onofre Nuclear Generating Station (SONGS);
|
§
|
cybersecurity threats to the energy grid, natural gas storage and pipeline infrastructure, the information and systems used to operate our businesses and the confidentiality of our proprietary information and the personal information of our customers, terrorist attacks that threaten system operations and critical infrastructure, and wars;
|
§
|
the ability to win competitively bid infrastructure projects against a number of strong competitors willing to aggressively bid for these projects;
|
§
|
weather conditions, conservation efforts, natural disasters, catastrophic accidents, and other events that may disrupt our operations, damage our facilities and systems, and subject us to third-party liability for property damage or personal injuries;
|
§
|
risks that our partners or counterparties will be unable or unwilling to fulfill their contractual commitments;
|
§
|
risks posed by decisions and actions of third parties who control the operations of investments in which we do not have a controlling interest;
|
§
|
risks inherent with nuclear power facilities and radioactive materials storage, including the catastrophic release of such materials, the disallowance of the recovery of the investment in, or operating costs of, the nuclear facility due to an extended outage and facility closure, and increased regulatory oversight, including motions to modify settlements;
|
§
|
business, regulatory, environmental and legal decisions and requirements;
|
§
|
expropriation of assets by foreign governments and title and other property disputes;
|
§
|
the impact on reliability of San Diego Gas & Electric Company’s (SDG&E) electric transmission and distribution system due to increased amount and variability of power supply from renewable energy sources and increased reliance on natural gas and natural gas transmission systems;
|
§
|
the impact on competitive customer rates of the growth in distributed and local power generation and the corresponding decrease in demand for power delivered through SDG&E’s electric transmission and distribution system;
|
§
|
the inability or determination not to enter into long-term supply and sales agreements or long-term firm capacity agreements due to insufficient market interest, unattractive pricing or other factors;
|
§
|
the resolution of litigation; and
|
§
|
other uncertainties, all of which are difficult to predict and many of which are beyond our control.
|
SEMPRA ENERGY
|
|||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||||
(Dollars in millions, except per share amounts)
|
|||||||||
Three months ended
|
Nine months ended
|
||||||||
September 30,
|
September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
||||||
(unaudited)
|
|||||||||
REVENUES
|
|||||||||
Utilities
|
$
|
2,213
|
$
|
2,463
|
$
|
6,768
|
$
|
7,318
|
|
Energy-related businesses
|
268
|
352
|
762
|
970
|
|||||
Total revenues
|
2,481
|
2,815
|
7,530
|
8,288
|
|||||
EXPENSES AND OTHER INCOME
|
|||||||||
Utilities:
|
|||||||||
Cost of natural gas
|
(201)
|
(293)
|
(786)
|
(1,308)
|
|||||
Cost of electric fuel and purchased power
|
(666)
|
(680)
|
(1,645)
|
(1,761)
|
|||||
Energy-related businesses:
|
|||||||||
Cost of natural gas, electric fuel and purchased power
|
(91)
|
(163)
|
(262)
|
(427)
|
|||||
Other cost of sales
|
(34)
|
(42)
|
(111)
|
(122)
|
|||||
Operation and maintenance
|
(701)
|
(726)
|
(2,072)
|
(2,131)
|
|||||
Depreciation and amortization
|
(315)
|
(292)
|
(925)
|
(866)
|
|||||
Franchise fees and other taxes
|
(111)
|
(104)
|
(314)
|
(301)
|
|||||
Plant closure adjustment
|
―
|
―
|
21
|
13
|
|||||
Gain on sale of equity interests and assets
|
―
|
19
|
62
|
48
|
|||||
Equity earnings, before income tax
|
33
|
22
|
79
|
62
|
|||||
Other income, net
|
12
|
29
|
88
|
118
|
|||||
Interest income
|
6
|
6
|
23
|
15
|
|||||
Interest expense
|
(143)
|
(144)
|
(416)
|
(418)
|
|||||
Income before income taxes and equity earnings
|
|||||||||
of certain unconsolidated subsidiaries
|
270
|
447
|
1,272
|
1,210
|
|||||
Income tax expense
|
(15)
|
(71)
|
(276)
|
(291)
|
|||||
Equity earnings, net of income tax
|
27
|
7
|
64
|
22
|
|||||
Net income
|
282
|
383
|
1,060
|
941
|
|||||
Earnings attributable to noncontrolling interests
|
(34)
|
(35)
|
(79)
|
(76)
|
|||||
Preferred dividends of subsidiary
|
―
|
―
|
(1)
|
(1)
|
|||||
Earnings
|
$
|
248
|
$
|
348
|
$
|
980
|
$
|
864
|
|
Basic earnings per common share
|
$
|
1.00
|
$
|
1.41
|
$
|
3.95
|
$
|
3.52
|
|
Weighted-average number of shares outstanding,
|
|||||||||
basic (thousands)
|
248,432
|
246,137
|
248,090
|
245,703
|
|||||
Diluted earnings per common share
|
$
|
0.99
|
$
|
1.39
|
$
|
3.91
|
$
|
3.45
|
|
Weighted-average number of shares outstanding,
|
|||||||||
diluted (thousands)
|
251,024
|
250,771
|
250,665
|
250,278
|
|||||
Dividends declared per share of common stock
|
$
|
0.70
|
$
|
0.66
|
$
|
2.10
|
$
|
1.98
|
|
See Notes to Condensed Consolidated Financial Statements.
|
SEMPRA ENERGY
|
|||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Sempra Energy shareholders' equity
|
|||||||||||
Pretax
|
Income tax
|
Net-of-tax
|
Noncontrolling
|
||||||||
amount
|
(expense) benefit
|
amount
|
interests (after-tax)
|
Total
|
|||||||
Three months ended September 30, 2015 and 2014
|
|||||||||||
(unaudited)
|
|||||||||||
2015:
|
|||||||||||
Net income
|
$
|
263
|
$
|
(15)
|
$
|
248
|
$
|
34
|
$
|
282
|
|
Other comprehensive income (loss):
|
|||||||||||
Foreign currency translation adjustments
|
(92)
|
―
|
(92)
|
|
(8)
|
(100)
|
|||||
Pension and other postretirement benefits
|
7
|
(2)
|
5
|
―
|
5
|
||||||
Financial instruments
|
(128)
|
50
|
(78)
|
(3)
|
(81)
|
||||||
Total other comprehensive loss
|
(213)
|
48
|
(165)
|
(11)
|
(176)
|
||||||
Comprehensive income
|
$
|
50
|
$
|
33
|
$
|
83
|
$
|
23
|
$
|
106
|
|
2014:
|
|||||||||||
Net income
|
$
|
419
|
$
|
(71)
|
$
|
348
|
$
|
35
|
$
|
383
|
|
Other comprehensive income (loss):
|
|||||||||||
Foreign currency translation adjustments
|
(100)
|
―
|
(100)
|
(11)
|
(111)
|
||||||
Pension and other postretirement benefits
|
8
|
(3)
|
5
|
―
|
5
|
||||||
Financial instruments
|
(4)
|
1
|
(3)
|
3
|
―
|
||||||
Total other comprehensive loss
|
(96)
|
(2)
|
(98)
|
(8)
|
(106)
|
||||||
Comprehensive income
|
$
|
323
|
$
|
(73)
|
$
|
250
|
$
|
27
|
$
|
277
|
Nine months ended September 30, 2015 and 2014
|
|||||||||||
(unaudited)
|
|||||||||||
2015:
|
|||||||||||
Net income
|
$
|
1,257
|
$
|
(276)
|
$
|
981
|
$
|
79
|
$
|
1,060
|
|
Other comprehensive income (loss):
|
|||||||||||
Foreign currency translation adjustments
|
(197)
|
―
|
(197)
|
(21)
|
(218)
|
||||||
Pension and other postretirement benefits
|
11
|
(4)
|
7
|
―
|
7
|
||||||
Financial instruments
|
(122)
|
48
|
(74)
|
(2)
|
(76)
|
||||||
Total other comprehensive loss
|
(308)
|
44
|
(264)
|
(23)
|
(287)
|
||||||
Comprehensive income
|
949
|
(232)
|
717
|
56
|
773
|
||||||
Preferred dividends of subsidiary
|
(1)
|
―
|
(1)
|
―
|
(1)
|
||||||
Comprehensive income, after preferred
|
|||||||||||
dividends of subsidiary
|
$
|
948
|
$
|
(232)
|
$
|
716
|
$
|
56
|
$
|
772
|
|
2014:
|
|||||||||||
Net income
|
$
|
1,156
|
$
|
(291)
|
$
|
865
|
$
|
76
|
$
|
941
|
|
Other comprehensive income (loss):
|
|||||||||||
Foreign currency translation adjustments
|
(141)
|
―
|
(141)
|
(12)
|
(153)
|
||||||
Pension and other postretirement benefits
|
21
|
(8)
|
13
|
―
|
13
|
||||||
Financial instruments
|
(24)
|
9
|
(15)
|
2
|
(13)
|
||||||
Total other comprehensive loss
|
(144)
|
1
|
(143)
|
(10)
|
(153)
|
||||||
Comprehensive income
|
1,012
|
(290)
|
722
|
66
|
788
|
||||||
Preferred dividends of subsidiary
|
(1)
|
―
|
(1)
|
―
|
(1)
|
||||||
Comprehensive income, after preferred
|
|||||||||||
dividends of subsidiary
|
$
|
1,011
|
$
|
(290)
|
$
|
721
|
$
|
66
|
$
|
787
|
|
See Notes to Condensed Consolidated Financial Statements.
|
SEMPRA ENERGY
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||
(Dollars in millions)
|
|||||
September 30,
|
December 31,
|
||||
2015
|
2014(1)
|
||||
(unaudited)
|
|||||
ASSETS
|
|||||
Current assets:
|
|||||
Cash and cash equivalents
|
$
|
697
|
$
|
570
|
|
Restricted cash
|
13
|
11
|
|||
Trade accounts receivable, net
|
1,024
|
1,242
|
|||
Other accounts and notes receivable, net
|
176
|
152
|
|||
Due from unconsolidated affiliates
|
3
|
38
|
|||
Income taxes receivable
|
22
|
45
|
|||
Deferred income taxes
|
198
|
305
|
|||
Inventories
|
416
|
396
|
|||
Regulatory balancing accounts – undercollected
|
585
|
746
|
|||
Fixed-price contracts and other derivatives
|
66
|
93
|
|||
Asset held for sale, power plant
|
―
|
293
|
|||
Other
|
406
|
293
|
|||
Total current assets
|
3,606
|
4,184
|
|||
Investments and other assets:
|
|||||
Restricted cash
|
40
|
29
|
|||
Due from unconsolidated affiliates
|
175
|
188
|
|||
Regulatory assets
|
3,112
|
3,031
|
|||
Nuclear decommissioning trusts
|
1,060
|
1,131
|
|||
Investments
|
2,845
|
2,848
|
|||
Goodwill
|
847
|
931
|
|||
Other intangible assets
|
407
|
415
|
|||
Dedicated assets in support of certain benefit plans
|
459
|
512
|
|||
Sundry
|
701
|
561
|
|||
Total investments and other assets
|
9,646
|
9,646
|
|||
Property, plant and equipment:
|
|||||
Property, plant and equipment
|
37,280
|
35,407
|
|||
Less accumulated depreciation and amortization
|
(9,966)
|
(9,505)
|
|||
Property, plant and equipment, net ($390 and $410 at September 30, 2015 and
December 31, 2014, respectively, related to VIE)
|
27,314
|
25,902
|
|||
Total assets
|
$
|
40,566
|
$
|
39,732
|
|
(1)
|
Derived from audited financial statements.
|
||||
See Notes to Condensed Consolidated Financial Statements.
|
SEMPRA ENERGY
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
|
|||||
(Dollars in millions)
|
|||||
September 30,
|
December 31,
|
||||
2015
|
2014(1)
|
||||
(unaudited)
|
|||||
LIABILITIES AND EQUITY
|
|||||
Current liabilities:
|
|||||
Short-term debt
|
$
|
1,097
|
$
|
1,733
|
|
Accounts payable – trade
|
1,091
|
1,198
|
|||
Accounts payable – other
|
143
|
155
|
|||
Due to unconsolidated affiliate
|
―
|
2
|
|||
Dividends and interest payable
|
343
|
282
|
|||
Accrued compensation and benefits
|
356
|
373
|
|||
Current portion of long-term debt
|
1,168
|
469
|
|||
Fixed-price contracts and other derivatives
|
73
|
55
|
|||
Customer deposits
|
152
|
153
|
|||
Other
|
695
|
649
|
|||
Total current liabilities
|
5,118
|
5,069
|
|||
Long-term debt ($307 and $315 at September 30, 2015 and December 31, 2014, respectively,
related to VIE)
|
12,527
|
12,167
|
|||
Deferred credits and other liabilities:
|
|||||
Customer advances for construction
|
145
|
144
|
|||
Pension and other postretirement benefit plan obligations, net of plan assets
|
1,114
|
1,064
|
|||
Deferred income taxes
|
3,057
|
3,003
|
|||
Deferred investment tax credits
|
34
|
37
|
|||
Regulatory liabilities arising from removal obligations
|
2,715
|
2,741
|
|||
Asset retirement obligations
|
2,068
|
2,048
|
|||
Fixed-price contracts and other derivatives
|
300
|
255
|
|||
Deferred credits and other
|
1,092
|
1,104
|
|||
Total deferred credits and other liabilities
|
10,525
|
10,396
|
|||
Commitments and contingencies (Note 11)
|
|||||
Equity:
|
|||||
Preferred stock (50 million shares authorized; none issued)
|
―
|
―
|
|||
Common stock (750 million shares authorized; 248 million and 246 million shares
|
|||||
outstanding at September 30, 2015 and December 31, 2014, respectively; no par value)
|
2,587
|
2,484
|
|||
Retained earnings
|
9,799
|
9,339
|
|||
Accumulated other comprehensive income (loss)
|
(761)
|
(497)
|
|||
Total Sempra Energy shareholders’ equity
|
11,625
|
11,326
|
|||
Preferred stock of subsidiary
|
20
|
20
|
|||
Other noncontrolling interests
|
751
|
754
|
|||
Total equity
|
12,396
|
12,100
|
|||
Total liabilities and equity
|
$
|
40,566
|
$
|
39,732
|
|
(1)
|
Derived from audited financial statements.
|
||||
See Notes to Condensed Consolidated Financial Statements.
|
SEMPRA ENERGY
|
|||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|||||
(Dollars in millions)
|
|||||
Nine months ended September 30,
|
|||||
2015
|
2014
|
||||
(unaudited)
|
|||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
|||||
Net income
|
$
|
1,060
|
$
|
941
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|||||
Depreciation and amortization
|
925
|
866
|
|||
Deferred income taxes and investment tax credits
|
179
|
131
|
|||
Gain on sale of equity interests and assets
|
(62)
|
(48)
|
|||
Plant closure adjustment
|
(21)
|
(13)
|
|||
Equity earnings
|
(143)
|
(84)
|
|||
Fixed-price contracts and other derivatives
|
(20)
|
(19)
|
|||
Other
|
28
|
32
|
|||
Net change in other working capital components
|
260
|
(215)
|
|||
Changes in other assets
|
(112)
|
28
|
|||
Changes in other liabilities
|
(5)
|
42
|
|||
Net cash provided by operating activities
|
2,089
|
1,661
|
|||
CASH FLOWS FROM INVESTING ACTIVITIES
|
|||||
Expenditures for property, plant and equipment
|
(2,227)
|
(2,320)
|
|||
Expenditures for investments and acquisition of business
|
(183)
|
(192)
|
|||
Proceeds from sale of equity interests and assets, net of cash sold
|
347
|
92
|
|||
Distributions from investments
|
14
|
15
|
|||
Purchases of nuclear decommissioning and other trust assets
|
(407)
|
(505)
|
|||
Proceeds from sales by nuclear decommissioning and other trusts
|
431
|
498
|
|||
Decrease in restricted cash
|
68
|
156
|
|||
Increase in restricted cash
|
(81)
|
(139)
|
|||
Advances to unconsolidated affiliates
|
(24)
|
(100)
|
|||
Repayments of advances to unconsolidated affiliates
|
74
|
19
|
|||
Other
|
9
|
10
|
|||
Net cash used in investing activities
|
(1,979)
|
(2,466)
|
|||
CASH FLOWS FROM FINANCING ACTIVITIES
|
|||||
Common dividends paid
|
(468)
|
(450)
|
|||
Preferred dividends paid by subsidiary
|
(1)
|
(1)
|
|||
Issuances of common stock
|
41
|
43
|
|||
Repurchases of common stock
|
(74)
|
(38)
|
|||
Issuances of debt (maturities greater than 90 days)
|
2,058
|
3,063
|
|||
Payments on debt (maturities greater than 90 days)
|
(1,316)
|
(1,845)
|
|||
Decrease in short-term debt, net
|
(201)
|
(111)
|
|||
Net distributions to noncontrolling interests
|
(57)
|
(84)
|
|||
Other
|
47
|
(5)
|
|||
Net cash provided by financing activities
|
29
|
572
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(12)
|
(4)
|
|||
Increase (decrease) in cash and cash equivalents
|
127
|
(237)
|
|||
Cash and cash equivalents, January 1
|
570
|
904
|
|||
Cash and cash equivalents, September 30
|
$
|
697
|
$
|
667
|
|
See Notes to Condensed Consolidated Financial Statements.
|
SEMPRA ENERGY
|
|||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)
|
|||||
(Dollars in millions)
|
|||||
Nine months ended September 30,
|
|||||
2015
|
2014
|
||||
(unaudited)
|
|||||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
|||||
Interest payments, net of amounts capitalized
|
$
|
355
|
$
|
359
|
|
Income tax payments, net of refunds
|
37
|
154
|
|||
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES
|
|||||
Acquisition of business:
|
|||||
Assets acquired
|
$
|
10
|
$
|
―
|
|
Liabilities assumed
|
(2)
|
―
|
|||
Accrued purchase price
|
(5)
|
―
|
|||
Cash paid
|
$
|
3
|
$
|
―
|
|
Accrued capital expenditures
|
$
|
459
|
$
|
385
|
|
Redemption of industrial development bonds
|
79
|
―
|
|||
Increase in capital lease obligations for investment in property, plant and equipment
|
―
|
60
|
|||
Dividends declared but not paid
|
179
|
166
|
|||
Financing of build-to-suit property
|
61
|
49
|
|||
Common dividends issued in stock
|
41
|
28
|
|||
See Notes to Condensed Consolidated Financial Statements.
|
SAN DIEGO GAS & ELECTRIC COMPANY
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||
(Dollars in millions)
|
||||||||
Three months ended
|
Nine months ended
|
|||||||
September 30,
|
September 30,
|
|||||||
2015
|
2014
|
2015
|
2014
|
|||||
(unaudited)
|
||||||||
Operating revenues
|
||||||||
Electric
|
$
|
1,140
|
$
|
1,133
|
$
|
2,819
|
$
|
2,892
|
Natural gas
|
90
|
100
|
349
|
391
|
||||
Total operating revenues
|
1,230
|
1,233
|
3,168
|
3,283
|
||||
Operating expenses
|
||||||||
Cost of electric fuel and purchased power
|
427
|
441
|
906
|
1,036
|
||||
Cost of natural gas
|
27
|
39
|
112
|
165
|
||||
Operation and maintenance
|
251
|
276
|
723
|
784
|
||||
Depreciation
|
152
|
134
|
446
|
395
|
||||
Franchise fees and other taxes
|
73
|
67
|
193
|
177
|
||||
Plant closure adjustment
|
―
|
―
|
(21)
|
(13)
|
||||
Total operating expenses
|
930
|
957
|
2,359
|
2,544
|
||||
Operating income
|
300
|
276
|
809
|
739
|
||||
Other income, net
|
8
|
9
|
26
|
29
|
||||
Interest expense
|
(51)
|
(51)
|
(155)
|
(152)
|
||||
Income before income taxes
|
257
|
234
|
680
|
616
|
||||
Income tax expense
|
(75)
|
(65)
|
(217)
|
(217)
|
||||
Net income
|
182
|
169
|
463
|
399
|
||||
Earnings attributable to noncontrolling interest
|
(12)
|
(12)
|
(20)
|
(20)
|
||||
Earnings attributable to common shares
|
$
|
170
|
$
|
157
|
$
|
443
|
$
|
379
|
See Notes to Condensed Consolidated Financial Statements.
|
SAN DIEGO GAS & ELECTRIC COMPANY
|
||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
||||||||||
(Dollars in millions)
|
||||||||||
SDG&E shareholder's equity
|
||||||||||
Pretax
|
Income tax
|
Net-of-tax
|
Noncontrolling
|
|||||||
amount
|
expense
|
amount
|
interest (after-tax)
|
Total
|
||||||
|
Three months ended September 30, 2015 and 2014
|
|||||||||
(unaudited)
|
||||||||||
2015:
|
||||||||||
Net income
|
$
|
245
|
$
|
(75)
|
$
|
170
|
$
|
12
|
$
|
182
|
Other comprehensive loss:
|
||||||||||
Financial instruments
|
―
|
―
|
―
|
(1)
|
(1)
|
|||||
Total other comprehensive loss
|
―
|
―
|
―
|
(1)
|
(1)
|
|||||
Comprehensive income
|
$
|
245
|
$
|
(75)
|
$
|
170
|
$
|
11
|
$
|
181
|
2014:
|
||||||||||
Net income
|
$
|
222
|
$
|
(65)
|
$
|
157
|
$
|
12
|
$
|
169
|
Other comprehensive income:
|
||||||||||
Pension and other postretirement benefits
|
1
|
―
|
1
|
―
|
1
|
|||||
Financial instruments
|
―
|
―
|
―
|
4
|
4
|
|||||
Total other comprehensive income
|
1
|
―
|
1
|
4
|
5
|
|||||
Comprehensive income
|
$
|
223
|
$
|
(65)
|
$
|
158
|
$
|
16
|
$
|
174
|
Nine months ended September 30, 2015 and 2014
|
||||||||||
(unaudited)
|
||||||||||
2015:
|
||||||||||
Net income/Comprehensive income
|
$
|
660
|
$
|
(217)
|
$
|
443
|
$
|
20
|
$
|
463
|
2014:
|
||||||||||
Net income
|
$
|
596
|
$
|
(217)
|
$
|
379
|
$
|
20
|
$
|
399
|
Other comprehensive income:
|
||||||||||
Pension and other postretirement benefits
|
3
|
(1)
|
2
|
―
|
2
|
|||||
Financial instruments
|
―
|
―
|
―
|
3
|
3
|
|||||
Total other comprehensive income
|
3
|
(1)
|
2
|
3
|
5
|
|||||
Comprehensive income
|
$
|
599
|
$
|
(218)
|
$
|
381
|
$
|
23
|
$
|
404
|
See Notes to Condensed Consolidated Financial Statements.
|
SAN DIEGO GAS & ELECTRIC COMPANY
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||
(Dollars in millions)
|
|||||
September 30,
|
December 31,
|
||||
2015
|
2014(1)
|
||||
(unaudited)
|
|||||
ASSETS
|
|||||
Current assets:
|
|||||
Cash and cash equivalents
|
$
|
20
|
$
|
8
|
|
Restricted cash
|
9
|
8
|
|||
Accounts receivable – trade, net
|
411
|
285
|
|||
Accounts receivable – other, net
|
27
|
35
|
|||
Due from unconsolidated affiliates
|
1
|
1
|
|||
Income taxes receivable
|
13
|
―
|
|||
Inventories
|
71
|
73
|
|||
Regulatory balancing accounts – net undercollected
|
495
|
711
|
|||
Regulatory assets
|
146
|
54
|
|||
Fixed-price contracts and other derivatives
|
20
|
44
|
|||
Other
|
135
|
125
|
|||
Total current assets
|
1,348
|
1,344
|
|||
Other assets:
|
|||||
Restricted cash
|
12
|
11
|
|||
Deferred taxes recoverable in rates
|
870
|
824
|
|||
Other regulatory assets
|
1,000
|
1,086
|
|||
Nuclear decommissioning trusts
|
1,060
|
1,131
|
|||
Sundry
|
376
|
282
|
|||
Total other assets
|
3,318
|
3,334
|
|||
Property, plant and equipment:
|
|||||
Property, plant and equipment
|
16,131
|
15,478
|
|||
Less accumulated depreciation
|
(4,105)
|
(3,860)
|
|||
Property, plant and equipment, net ($390 and $410 at September 30, 2015 and
December 31, 2014, respectively, related to VIE)
|
12,026
|
11,618
|
|||
Total assets
|
$
|
16,692
|
$
|
16,296
|
|
(1)
|
Derived from audited financial statements.
|
||||
See Notes to Condensed Consolidated Financial Statements.
|
SAN DIEGO GAS & ELECTRIC COMPANY
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
|
|||||
(Dollars in millions)
|
|||||
September 30,
|
December 31,
|
||||
2015
|
2014(1)
|
||||
(unaudited)
|
|||||
LIABILITIES AND EQUITY
|
|||||
Current liabilities:
|
|||||
Short-term debt
|
$
|
44
|
$
|
246
|
|
Accounts payable
|
408
|
441
|
|||
Due to unconsolidated affiliates
|
22
|
21
|
|||
Income taxes payable
|
―
|
30
|
|||
Deferred income taxes
|
243
|
53
|
|||
Interest payable
|
49
|
40
|
|||
Accrued compensation and benefits
|
110
|
124
|
|||
Current portion of long-term debt
|
301
|
365
|
|||
Asset retirement obligations
|
108
|
120
|
|||
Fixed-price contracts and other derivatives
|
62
|
40
|
|||
Customer deposits
|
71
|
71
|
|||
Other
|
264
|
237
|
|||
Total current liabilities
|
1,682
|
1,788
|
|||
Long-term debt ($307 and $315 at September 30, 2015 and December 31, 2014,
respectively, related to VIE)
|
4,477
|
4,319
|
|||
Deferred credits and other liabilities:
|
|||||
Customer advances for construction
|
43
|
41
|
|||
Pension and other postretirement benefit plan obligations, net of plan assets
|
227
|
216
|
|||
Deferred income taxes
|
2,155
|
2,121
|
|||
Deferred investment tax credits
|
19
|
22
|
|||
Regulatory liabilities arising from removal obligations
|
1,538
|
1,557
|
|||
Asset retirement obligations
|
740
|
754
|
|||
Fixed-price contracts and other derivatives
|
170
|
153
|
|||
Deferred credits and other
|
352
|
333
|
|||
Total deferred credits and other liabilities
|
5,244
|
5,197
|
|||
Commitments and contingencies (Note 11)
|
|||||
Equity:
|
|||||
Common stock (255 million shares authorized; 117 million shares outstanding;
|
|||||
no par value)
|
1,338
|
1,338
|
|||
Retained earnings
|
3,899
|
3,606
|
|||
Accumulated other comprehensive income (loss)
|
(12)
|
(12)
|
|||
Total SDG&E shareholder's equity
|
5,225
|
4,932
|
|||
Noncontrolling interest
|
64
|
60
|
|||
Total equity
|
5,289
|
4,992
|
|||
Total liabilities and equity
|
$
|
16,692
|
$
|
16,296
|
|
(1)
|
Derived from audited financial statements.
|
||||
See Notes to Condensed Consolidated Financial Statements.
|
SAN DIEGO GAS & ELECTRIC COMPANY
|
||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||
(Dollars in millions)
|
||||
Nine months ended September 30,
|
||||
2015
|
2014
|
|||
(unaudited)
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||
Net income
|
$
|
463
|
$
|
399
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||
Depreciation
|
446
|
395
|
||
Deferred income taxes and investment tax credits
|
170
|
193
|
||
Plant closure adjustment
|
(21)
|
(13)
|
||
Fixed-price contracts and other derivatives
|
(3)
|
(5)
|
||
Other
|
(14)
|
(30)
|
||
Net change in other working capital components
|
136
|
(252)
|
||
Changes in other assets
|
(93)
|
106
|
||
Changes in other liabilities
|
10
|
28
|
||
Net cash provided by operating activities
|
1,094
|
821
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||
Expenditures for property, plant and equipment
|
(835)
|
(790)
|
||
Purchases of nuclear decommissioning trust assets
|
(404)
|
(501)
|
||
Proceeds from sales by nuclear decommissioning trusts
|
431
|
498
|
||
Decrease in restricted cash
|
27
|
109
|
||
Increase in restricted cash
|
(29)
|
(96)
|
||
Other
|
―
|
(16)
|
||
Net cash used in investing activities
|
(810)
|
(796)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||
Common dividends paid
|
(150)
|
―
|
||
Issuances of long-term debt
|
388
|
100
|
||
Payments on long-term debt
|
(294)
|
(22)
|
||
Decrease in short-term debt, net
|
(202)
|
(59)
|
||
Capital distributions made by Otay Mesa VIE
|
(14)
|
(38)
|
||
Net cash used in financing activities
|
(272)
|
(19)
|
||
Increase in cash and cash equivalents
|
12
|
6
|
||
Cash and cash equivalents, January 1
|
8
|
27
|
||
Cash and cash equivalents, September 30
|
$
|
20
|
$
|
33
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
||||
Interest payments, net of amounts capitalized
|
$
|
141
|
$
|
136
|
Income tax payments (refunds), net
|
62
|
(4)
|
||
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES
|
||||
Accrued capital expenditures
|
$
|
142
|
$
|
118
|
Increase in capital lease obligations for investment in property, plant and equipment
|
―
|
60
|
||
See Notes to Condensed Consolidated Financial Statements.
|
SOUTHERN CALIFORNIA GAS COMPANY
|
||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||
(Dollars in millions)
|
||||||||
Three months ended
September 30,
|
Nine months ended
September 30,
|
|||||||
2015
|
2014
|
2015
|
2014
|
|||||
(unaudited)
|
||||||||
Operating revenues
|
$
|
620
|
$
|
855
|
$
|
2,448
|
$
|
2,857
|
Operating expenses
|
||||||||
Cost of natural gas
|
163
|
237
|
626
|
1,066
|
||||
Operation and maintenance
|
325
|
326
|
985
|
968
|
||||
Depreciation
|
116
|
109
|
342
|
321
|
||||
Franchise fees and other taxes
|
29
|
30
|
94
|
98
|
||||
Total operating expenses
|
633
|
702
|
2,047
|
2,453
|
||||
Operating (loss) income
|
(13)
|
153
|
401
|
404
|
||||
Other income, net
|
8
|
6
|
25
|
13
|
||||
Interest income
|
―
|
―
|
3
|
―
|
||||
Interest expense
|
(23)
|
(17)
|
(61)
|
(50)
|
||||
(Loss) income before income taxes
|
(28)
|
142
|
368
|
367
|
||||
Income tax benefit (expense)
|
20
|
(44)
|
(91)
|
(110)
|
||||
Net (loss) income
|
(8)
|
98
|
277
|
257
|
||||
Preferred dividend requirements
|
―
|
―
|
(1)
|
(1)
|
||||
(Losses) earnings attributable to common shares
|
$
|
(8)
|
$
|
98
|
$
|
276
|
$
|
256
|
See Notes to Condensed Consolidated Financial Statements.
|
SOUTHERN CALIFORNIA GAS COMPANY
|
||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
|
||||||
(Dollars in millions)
|
||||||
Pretax
|
Income tax
|
Net-of-tax
|
||||
amount
|
benefit (expense)
|
amount
|
||||
Three months ended September 30, 2015 and 2014
|
||||||
(unaudited)
|
||||||
2015:
|
||||||
Net loss/Comprehensive loss
|
$
|
(28)
|
$
|
20
|
$
|
(8)
|
2014:
|
||||||
Net income
|
$
|
142
|
$
|
(44)
|
$
|
98
|
Other comprehensive income:
|
||||||
Pension and other postretirement benefits
|
4
|
(2)
|
2
|
|||
Total other comprehensive income
|
4
|
(2)
|
2
|
|||
Comprehensive income
|
$
|
146
|
$
|
(46)
|
$
|
100
|
Nine months ended September 30, 2015 and 2014
|
||||||
(unaudited)
|
||||||
2015:
|
||||||
Net income/Comprehensive income
|
$
|
368
|
$
|
(91)
|
$
|
277
|
2014:
|
||||||
Net income
|
$
|
367
|
$
|
(110)
|
$
|
257
|
Other comprehensive income:
|
||||||
Pension and other postretirement benefits
|
4
|
(2)
|
2
|
|||
Total other comprehensive income
|
4
|
(2)
|
2
|
|||
Comprehensive income
|
$
|
371
|
$
|
(112)
|
$
|
259
|
See Notes to Condensed Consolidated Financial Statements.
|
SOUTHERN CALIFORNIA GAS COMPANY
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||
(Dollars in millions)
|
|||||
September 30,
|
December 31,
|
||||
2015
|
2014(1)
|
||||
(unaudited)
|
|||||
ASSETS
|
|||||
Current assets:
|
|||||
Cash and cash equivalents
|
$
|
123
|
$
|
85
|
|
Accounts receivable – trade, net
|
301
|
586
|
|||
Accounts receivable – other, net
|
69
|
51
|
|||
Due from unconsolidated affiliates
|
220
|
4
|
|||
Income taxes receivable
|
25
|
5
|
|||
Inventories
|
192
|
181
|
|||
Regulatory balancing accounts – net undercollected
|
90
|
35
|
|||
Regulatory assets
|
7
|
5
|
|||
Other
|
39
|
36
|
|||
Total current assets
|
1,066
|
988
|
|||
Other assets:
|
|||||
Regulatory assets arising from pension obligations
|
665
|
617
|
|||
Other regulatory assets
|
543
|
472
|
|||
Sundry
|
176
|
140
|
|||
Total other assets
|
1,384
|
1,229
|
|||
Property, plant and equipment:
|
|||||
Property, plant and equipment
|
13,739
|
12,886
|
|||
Less accumulated depreciation
|
(4,834)
|
(4,642)
|
|||
Property, plant and equipment, net
|
8,905
|
8,244
|
|||
Total assets
|
$
|
11,355
|
$
|
10,461
|
|
(1)
|
Derived from audited financial statements.
|
||||
See Notes to Condensed Consolidated Financial Statements.
|
SOUTHERN CALIFORNIA GAS COMPANY
|
|||||
CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
|
|||||
(Dollars in millions)
|
|||||
September 30,
|
December 31,
|
||||
2015
|
2014(1)
|
||||
(unaudited)
|
|||||
LIABILITIES AND SHAREHOLDERS' EQUITY
|
|||||
Current liabilities:
|
|||||
Short-term debt
|
$
|
―
|
$
|
50
|
|
Accounts payable – trade
|
355
|
532
|
|||
Accounts payable – other
|
77
|
88
|
|||
Due to unconsolidated affiliates
|
51
|
13
|
|||
Deferred income taxes
|
171
|
53
|
|||
Accrued compensation and benefits
|
144
|
129
|
|||
Current portion of long-term debt
|
9
|
―
|
|||
Customer deposits
|
74
|
75
|
|||
Other
|
164
|
149
|
|||
Total current liabilities
|
1,045
|
1,089
|
|||
Long-term debt
|
2,498
|
1,906
|
|||
Deferred credits and other liabilities:
|
|||||
Customer advances for construction
|
102
|
102
|
|||
Pension obligation, net of plan assets
|
682
|
633
|
|||
Deferred income taxes
|
1,270
|
1,212
|
|||
Deferred investment tax credits
|
14
|
16
|
|||
Regulatory liabilities arising from removal obligations
|
1,158
|
1,167
|
|||
Asset retirement obligations
|
1,286
|
1,255
|
|||
Deferred credits and other
|
293
|
300
|
|||
Total deferred credits and other liabilities
|
4,805
|
4,685
|
|||
Commitments and contingencies (Note 11)
|
|||||
Shareholders' equity:
|
|||||
Preferred stock
|
22
|
22
|
|||
Common stock (100 million shares authorized; 91 million shares outstanding;
|
|||||
no par value)
|
866
|
866
|
|||
Retained earnings
|
2,137
|
1,911
|
|||
Accumulated other comprehensive income (loss)
|
(18)
|
(18)
|
|||
Total shareholders' equity
|
3,007
|
2,781
|
|||
Total liabilities and shareholders' equity
|
$
|
11,355
|
$
|
10,461
|
|
(1)
|
Derived from audited financial statements.
|
||||
See Notes to Condensed Consolidated Financial Statements.
|
SOUTHERN CALIFORNIA GAS COMPANY
|
||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
|
||||
(Dollars in millions)
|
||||
Nine months ended September 30,
|
||||
2015
|
2014
|
|||
(unaudited)
|
||||
CASH FLOWS FROM OPERATING ACTIVITIES
|
||||
Net income
|
$
|
277
|
$
|
257
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||
Depreciation
|
342
|
321
|
||
Deferred income taxes and investment tax credits
|
98
|
94
|
||
Other
|
(18)
|
(2)
|
||
Net change in other working capital components
|
48
|
(19)
|
||
Changes in other assets
|
(57)
|
(70)
|
||
Changes in other liabilities
|
―
|
15
|
||
Net cash provided by operating activities
|
690
|
596
|
||
CASH FLOWS FROM INVESTING ACTIVITIES
|
||||
Expenditures for property, plant and equipment
|
(946)
|
(764)
|
||
Increase in loans to affiliates, net
|
(250)
|
(281)
|
||
Net cash used in investing activities
|
(1,196)
|
(1,045)
|
||
CASH FLOWS FROM FINANCING ACTIVITIES
|
||||
Preferred dividends paid
|
(1)
|
(1)
|
||
Issuances of long-term debt
|
599
|
747
|
||
Repayment of long-term debt
|
―
|
(250)
|
||
Decrease in short-term debt, net
|
(50)
|
(42)
|
||
Other
|
(4)
|
(7)
|
||
Net cash provided by financing activities
|
544
|
447
|
||
Increase (decrease) in cash and cash equivalents
|
38
|
(2)
|
||
Cash and cash equivalents, January 1
|
85
|
27
|
||
Cash and cash equivalents, September 30
|
$
|
123
|
$
|
25
|
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
|
||||
Interest payments, net of amounts capitalized
|
$
|
53
|
$
|
43
|
Income tax payments, net
|
11
|
19
|
||
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES
|
||||
Accrued capital expenditures
|
$
|
172
|
$
|
137
|
Dividends declared but not paid
|
50
|
―
|
||
See Notes to Condensed Consolidated Financial Statements.
|
§
|
San Diego Gas & Electric Company (SDG&E) and SoCalGas, which are separate, reportable segments;
|
§
|
Sempra International, which includes our Sempra South American Utilities and Sempra Mexico reportable segments; and
|
§
|
Sempra U.S. Gas & Power, which includes our Sempra Renewables and Sempra Natural Gas reportable segments.
|
DECONSOLIDATION OF SUBSIDIARIES
|
|||||||
(Dollars in millions)
|
|||||||
Energía
Sierra Juárez
|
Copper Mountain Solar 3
|
Sempra Energy
Consolidated
|
|||||
At July 16, 2014
|
At March 13, 2014
|
||||||
Proceeds from sale, net of negligible transaction costs
|
$
|
26
|
$
|
68
|
$
|
94
|
|
Cash
|
(2)
|
(2)
|
(4)
|
||||
Other current assets
|
(11)
|
―
|
(11)
|
||||
Property, plant and equipment, net
|
(137)
|
(247)
|
(384)
|
||||
Other assets
|
(16)
|
(11)
|
(27)
|
||||
Accounts payable and accrued expenses
|
10
|
82
|
92
|
||||
Due to affiliate
|
39
|
―
|
39
|
||||
Long-term debt, including current portion
|
82
|
97
|
179
|
||||
Other liabilities
|
7
|
3
|
10
|
||||
Accumulated other comprehensive income
|
(5)
|
(2)
|
(7)
|
||||
Gain on sale of equity interests
|
(19)
|
(27)
|
(46)
|
||||
(Increase) in equity method investments upon deconsolidation
|
$
|
(26)
|
$
|
(39)
|
$
|
(65)
|
INVENTORY BALANCES
|
|||||||||||||||||
(Dollars in millions)
|
|||||||||||||||||
Natural gas
|
Liquefied natural gas
|
Materials and supplies
|
Total
|
||||||||||||||
September 30,
2015
|
December 31,
2014
|
September 30,
2015
|
December 31,
2014
|
September 30,
2015
|
December 31,
2014
|
September 30,
2015
|
December 31,
2014
|
||||||||||
SDG&E
|
$
|
4
|
$
|
8
|
$
|
―
|
$
|
―
|
$
|
67
|
$
|
65
|
$
|
71
|
$
|
73
|
|
SoCalGas
|
162
|
155
|
―
|
―
|
30
|
26
|
192
|
181
|
|||||||||
Sempra South American
|
|||||||||||||||||
Utilities
|
―
|
―
|
―
|
―
|
34
|
33
|
34
|
33
|
|||||||||
Sempra Mexico
|
―
|
―
|
7
|
9
|
10
|
9
|
17
|
18
|
|||||||||
Sempra Renewables
|
―
|
―
|
―
|
―
|
2
|
2
|
2
|
2
|
|||||||||
Sempra Natural Gas
|
95
|
83
|
4
|
5
|
1
|
1
|
100
|
89
|
|||||||||
Sempra Energy
|
|||||||||||||||||
Consolidated
|
$
|
261
|
$
|
246
|
$
|
11
|
$
|
14
|
$
|
144
|
$
|
136
|
$
|
416
|
$
|
396
|
§
|
the purpose and design of the VIE;
|
§
|
the nature of the VIE’s risks and the risks we absorb;
|
§
|
the power to direct activities that most significantly impact the economic performance of the VIE; and
|
§
|
the obligation to absorb losses or right to receive benefits that could be significant to the VIE.
|
AMOUNTS ASSOCIATED WITH OTAY MESA VIE
|
||||||||
(Dollars in millions)
|
||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
|||||||
2015
|
2014
|
2015
|
2014
|
|||||
Operating expenses
|
||||||||
Cost of electric fuel and purchased power
|
$
|
(27)
|
$
|
(27)
|
$
|
(66)
|
$
|
(67)
|
Operation and maintenance
|
3
|
3
|
13
|
13
|
||||
Depreciation
|
7
|
7
|
19
|
21
|
||||
Total operating expenses
|
(17)
|
(17)
|
(34)
|
(33)
|
||||
Operating income
|
17
|
17
|
34
|
33
|
||||
Interest expense
|
(5)
|
(5)
|
(14)
|
(13)
|
||||
Income before income taxes/Net income
|
12
|
12
|
20
|
20
|
||||
Earnings attributable to noncontrolling interest
|
(12)
|
(12)
|
(20)
|
(20)
|
||||
Earnings attributable to common shares
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
―
|
NET PERIODIC BENEFIT COST – SEMPRA ENERGY CONSOLIDATED
|
||||||||
(Dollars in millions)
|
||||||||
Pension benefits
|
Other postretirement benefits
|
|||||||
Three months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
|||||
Service cost
|
$
|
27
|
$
|
23
|
$
|
5
|
$
|
6
|
Interest cost
|
38
|
39
|
10
|
13
|
||||
Expected return on assets
|
(42)
|
(42)
|
(17)
|
(15)
|
||||
Amortization of:
|
||||||||
Prior service cost (credit)
|
3
|
3
|
(1)
|
(2)
|
||||
Actuarial loss
|
9
|
3
|
―
|
―
|
||||
Settlements and special termination benefits
|
4
|
5
|
―
|
5
|
||||
Regulatory adjustment
|
(27)
|
6
|
4
|
5
|
||||
Total net periodic benefit cost
|
$
|
12
|
$
|
37
|
$
|
1
|
$
|
12
|
Nine months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
|||||
Service cost
|
$
|
86
|
$
|
75
|
$
|
19
|
$
|
18
|
Interest cost
|
116
|
121
|
33
|
37
|
||||
Expected return on assets
|
(130)
|
(128)
|
(51)
|
(47)
|
||||
Amortization of:
|
||||||||
Prior service cost (credit)
|
8
|
8
|
(2)
|
(4)
|
||||
Actuarial loss
|
28
|
13
|
―
|
―
|
||||
Settlements and special termination benefits
|
4
|
14
|
―
|
5
|
||||
Regulatory adjustment
|
(86)
|
(18)
|
4
|
5
|
||||
Total net periodic benefit cost
|
$
|
26
|
$
|
85
|
$
|
3
|
$
|
14
|
NET PERIODIC BENEFIT COST – SDG&E
|
||||||||
(Dollars in millions)
|
||||||||
Pension benefits
|
Other postretirement benefits
|
|||||||
Three months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
|||||
Service cost
|
$
|
6
|
$
|
8
|
$
|
1
|
$
|
2
|
Interest cost
|
9
|
10
|
2
|
3
|
||||
Expected return on assets
|
(14)
|
(13)
|
(2)
|
(2)
|
||||
Amortization of:
|
||||||||
Actuarial loss
|
3
|
1
|
―
|
―
|
||||
Special termination benefits
|
―
|
―
|
―
|
5
|
||||
Regulatory adjustment
|
(3)
|
6
|
(1)
|
4
|
||||
Total net periodic benefit cost
|
$
|
1
|
$
|
12
|
$
|
―
|
$
|
12
|
Nine months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
|||||
Service cost
|
$
|
22
|
$
|
23
|
$
|
5
|
$
|
5
|
Interest cost
|
29
|
32
|
6
|
7
|
||||
Expected return on assets
|
(41)
|
(41)
|
(8)
|
(8)
|
||||
Amortization of:
|
||||||||
Prior service cost
|
1
|
1
|
2
|
2
|
||||
Actuarial loss
|
7
|
3
|
―
|
―
|
||||
Settlements and special termination benefits
|
―
|
2
|
―
|
5
|
||||
Regulatory adjustment
|
(15)
|
7
|
(5)
|
1
|
||||
Total net periodic benefit cost
|
$
|
3
|
$
|
27
|
$
|
―
|
$
|
12
|
NET PERIODIC BENEFIT COST – SOCALGAS
|
||||||||
(Dollars in millions)
|
||||||||
Pension benefits
|
Other postretirement benefits
|
|||||||
Three months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
|||||
Service cost
|
$
|
17
|
$
|
13
|
$
|
3
|
$
|
4
|
Interest cost
|
25
|
24
|
8
|
9
|
||||
Expected return on assets
|
(25)
|
(26)
|
(14)
|
(12)
|
||||
Amortization of:
|
||||||||
Prior service cost (credit)
|
2
|
2
|
(2)
|
(2)
|
||||
Actuarial loss
|
5
|
1
|
―
|
―
|
||||
Settlement
|
―
|
4
|
―
|
―
|
||||
Regulatory adjustment
|
(24)
|
―
|
5
|
1
|
||||
Total net periodic benefit cost
|
$
|
―
|
$
|
18
|
$
|
―
|
$
|
―
|
Nine months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
|||||
Service cost
|
$
|
55
|
$
|
45
|
$
|
13
|
$
|
12
|
Interest cost
|
74
|
75
|
26
|
28
|
||||
Expected return on assets
|
(79)
|
(78)
|
(42)
|
(38)
|
||||
Amortization of:
|
||||||||
Prior service cost (credit)
|
6
|
6
|
(6)
|
(6)
|
||||
Actuarial loss
|
16
|
5
|
―
|
―
|
||||
Settlement
|
―
|
4
|
―
|
―
|
||||
Regulatory adjustment
|
(71)
|
(25)
|
9
|
4
|
||||
Total net periodic benefit cost
|
$
|
1
|
$
|
32
|
$
|
―
|
$
|
―
|
BENEFIT PLAN CONTRIBUTIONS
|
||||||
(Dollars in millions)
|
||||||
Sempra Energy
|
||||||
Consolidated
|
SDG&E
|
SoCalGas
|
||||
Contributions through September 30, 2015:
|
||||||
Pension plans
|
$
|
27
|
$
|
2
|
$
|
1
|
Other postretirement benefit plans
|
3
|
―
|
―
|
|||
Total expected contributions in 2015:
|
||||||
Pension plans
|
$
|
36
|
$
|
3
|
$
|
7
|
Other postretirement benefit plans
|
11
|
7
|
1
|
EARNINGS PER SHARE COMPUTATIONS
|
||||||||||
(Dollars in millions, except per share amounts; shares in thousands)
|
||||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
|||||||||
2015
|
2014
|
2015
|
2014
|
|||||||
Numerator:
|
||||||||||
Earnings/Income attributable to common shares
|
$
|
248
|
$
|
348
|
$
|
980
|
$
|
864
|
||
Denominator:
|
||||||||||
Weighted-average common shares
|
||||||||||
outstanding for basic EPS(1)
|
248,432
|
246,137
|
248,090
|
245,703
|
||||||
Dilutive effect of stock options, restricted
|
||||||||||
stock awards and restricted stock units
|
2,592
|
4,634
|
2,575
|
4,575
|
||||||
Weighted-average common shares
|
||||||||||
|
outstanding for diluted EPS
|
251,024
|
250,771
|
250,665
|
250,278
|
|||||
Earnings per share:
|
||||||||||
Basic
|
$
|
1.00
|
$
|
1.41
|
$
|
3.95
|
$
|
3.52
|
||
Diluted
|
0.99
|
1.39
|
3.91
|
3.45
|
||||||
(1)
|
Includes fully vested restricted stock units of 504 and 222 held in our Deferred Compensation Plan for the three months ended September 30, 2015 and 2014, respectively, and 486 and 209 for the nine months ended September 30, 2015 and 2014, respectively. These fully vested restricted stock units are included in weighted-average common shares outstanding for basic EPS because there are no conditions under which the corresponding shares will not be issued.
|
CAPITALIZED FINANCING COSTS
|
|||||||||
(Dollars in millions)
|
|||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
||||||
Sempra Energy Consolidated:
|
|||||||||
AFUDC related to debt
|
$
|
6
|
$
|
5
|
$
|
19
|
$
|
15
|
|
AFUDC related to equity
|
26
|
28
|
84
|
77
|
|||||
Other capitalized financing costs
|
18
|
6
|
52
|
22
|
|||||
Total Sempra Energy Consolidated
|
$
|
50
|
$
|
39
|
$
|
155
|
$
|
114
|
|
SDG&E:
|
|||||||||
AFUDC related to debt
|
$
|
3
|
$
|
3
|
$
|
10
|
$
|
10
|
|
AFUDC related to equity
|
9
|
8
|
27
|
26
|
|||||
Total SDG&E
|
$
|
12
|
$
|
11
|
$
|
37
|
$
|
36
|
|
SoCalGas:
|
|||||||||
AFUDC related to debt
|
$
|
3
|
$
|
2
|
$
|
9
|
$
|
5
|
|
AFUDC related to equity
|
10
|
7
|
29
|
18
|
|||||
Other capitalized financing costs
|
1
|
―
|
1
|
―
|
|||||
Total SoCalGas
|
$
|
14
|
$
|
9
|
$
|
39
|
$
|
23
|
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1)
|
|||||||||||
SEMPRA ENERGY CONSOLIDATED
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Pension and other
|
|||||||||||
postretirement benefits
|
|||||||||||
Foreign
|
Total
|
||||||||||
currency
|
Unamortized
|
Unamortized
|
accumulated other
|
||||||||
translation
|
net actuarial
|
prior service
|
Financial
|
comprehensive
|
|||||||
adjustments
|
gain (loss)
|
cost
|
instruments
|
income (loss)
|
|||||||
Three months ended September 30, 2015 and 2014
|
|||||||||||
2015:
|
|||||||||||
Balance as of June 30, 2015
|
$
|
(427)
|
$
|
(81)
|
$
|
(2)
|
$
|
(86)
|
$
|
(596)
|
|
Other comprehensive loss before
|
|||||||||||
reclassifications
|
(92)
|
―
|
―
|
(79)
|
(171)
|
||||||
Amounts reclassified from accumulated other
|
|||||||||||
comprehensive income
|
―
|
5
|
―
|
1
|
6
|
||||||
Net other comprehensive (loss) income
|
(92)
|
5
|
―
|
(78)
|
(165)
|
||||||
Balance as of September 30, 2015
|
$
|
(519)
|
$
|
(76)
|
$
|
(2)
|
$
|
(164)
|
$
|
(761)
|
|
2014:
|
|||||||||||
Balance as of June 30, 2014
|
$
|
(170)
|
$
|
(65)
|
$
|
―
|
$
|
(38)
|
$
|
(273)
|
|
Other comprehensive loss before
|
|||||||||||
reclassifications
|
(100)
|
―
|
―
|
(2)
|
(102)
|
||||||
Amounts reclassified from accumulated other
|
|||||||||||
comprehensive income (loss)
|
―
|
5
|
―
|
(1)
|
4
|
||||||
Net other comprehensive (loss) income
|
(100)
|
5
|
―
|
(3)
|
(98)
|
||||||
Balance as of September 30, 2014
|
$
|
(270)
|
$
|
(60)
|
$
|
―
|
$
|
(41)
|
$
|
(371)
|
|
Nine months ended September 30, 2015 and 2014
|
|||||||||||
2015:
|
|||||||||||
Balance as of December 31, 2014
|
$
|
(322)
|
$
|
(83)
|
$
|
(2)
|
$
|
(90)
|
$
|
(497)
|
|
Other comprehensive loss before
|
|||||||||||
reclassifications
|
(197)
|
―
|
―
|
(76)
|
(273)
|
||||||
Amounts reclassified from accumulated other
|
|||||||||||
comprehensive income
|
―
|
7
|
―
|
2
|
9
|
||||||
Net other comprehensive (loss) income
|
(197)
|
7
|
―
|
(74)
|
(264)
|
||||||
Balance as of September 30, 2015
|
$
|
(519)
|
$
|
(76)
|
$
|
(2)
|
$
|
(164)
|
$
|
(761)
|
|
2014:
|
.
|
||||||||||
Balance as of December 31, 2013
|
$
|
(129)
|
$
|
(73)
|
$
|
―
|
$
|
(26)
|
$
|
(228)
|
|
Other comprehensive loss before
|
|||||||||||
reclassifications
|
(141)
|
―
|
―
|
(28)
|
(169)
|
||||||
Amounts reclassified from accumulated other
|
|||||||||||
comprehensive income
|
―
|
13
|
―
|
13
|
26
|
||||||
Net other comprehensive (loss) income
|
(141)
|
13
|
―
|
(15)
|
(143)
|
||||||
Balance as of September 30, 2014
|
$
|
(270)
|
$
|
(60)
|
$
|
―
|
$
|
(41)
|
$
|
(371)
|
|
(1)
|
All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests.
|
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1)
|
||||||||
SAN DIEGO GAS & ELECTRIC COMPANY
|
||||||||
(Dollars in millions)
|
||||||||
Pension and other
|
||||||||
postretirement benefits
|
||||||||
Total
|
||||||||
Unamortized
|
Unamortized
|
accumulated other
|
||||||
net actuarial
|
prior service
|
comprehensive
|
||||||
gain (loss)
|
credit
|
income (loss)
|
||||||
Three months ended September 30, 2015 and 2014
|
||||||||
2015:
|
||||||||
Balance as of June 30 and September 30, 2015
|
$
|
(13)
|
$
|
1
|
$
|
(12)
|
||
2014:
|
||||||||
Balance as of June 30, 2014
|
$
|
(9)
|
$
|
1
|
$
|
(8)
|
||
Amounts reclassified from accumulated other
|
||||||||
comprehensive income
|
1
|
―
|
1
|
|||||
Net other comprehensive income
|
1
|
―
|
1
|
|||||
Balance as of September 30, 2014
|
$
|
(8)
|
$
|
1
|
$
|
(7)
|
||
Nine months ended September 30, 2015 and 2014
|
||||||||
2015:
|
||||||||
Balance as of December 31, 2014 and September 30, 2015
|
$
|
(13)
|
$
|
1
|
$
|
(12)
|
||
2014:
|
||||||||
Balance as of December 31, 2013
|
$
|
(10)
|
$
|
1
|
$
|
(9)
|
||
Amounts reclassified from accumulated other
|
||||||||
comprehensive income
|
2
|
―
|
2
|
|||||
Net other comprehensive income
|
2
|
―
|
2
|
|||||
Balance as of September 30, 2014
|
$
|
(8)
|
$
|
1
|
$
|
(7)
|
||
(1)
|
All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests.
|
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1)
|
|||||||||
SOUTHERN CALIFORNIA GAS COMPANY
|
|||||||||
(Dollars in millions)
|
|||||||||
Pension and other
|
|||||||||
postretirement benefits
|
|||||||||
Total
|
|||||||||
Unamortized
|
Unamortized
|
accumulated other
|
|||||||
net actuarial
|
prior service
|
Financial
|
comprehensive
|
||||||
gain (loss)
|
credit
|
instruments
|
income (loss)
|
||||||
Three months ended September 30, 2015 and 2014
|
|||||||||
2015:
|
|
||||||||
Balance as of June 30 and September 30, 2015
|
$
|
(5)
|
$
|
1
|
$
|
(14)
|
$
|
(18)
|
|
2014:
|
|||||||||
Balance as of June 30, 2014
|
$
|
(5)
|
$
|
1
|
$
|
(14)
|
$
|
(18)
|
|
Amounts reclassified from accumulated other
|
|||||||||
comprehensive income
|
2
|
―
|
―
|
2
|
|||||
Net other comprehensive income
|
2
|
―
|
―
|
2
|
|||||
Balance as of September 30, 2014
|
$
|
(3)
|
$
|
1
|
$
|
(14)
|
$
|
(16)
|
|
Nine months ended September 30, 2015 and 2014
|
|||||||||
2015:
|
|||||||||
Balance as of December 31, 2014 and September 30, 2015
|
$
|
(5)
|
$
|
1
|
$
|
(14)
|
$
|
(18)
|
|
2014:
|
|||||||||
Balance as of December 31, 2013
|
$
|
(5)
|
$
|
1
|
$
|
(14)
|
$
|
(18)
|
|
Amounts reclassified from accumulated other
|
|||||||||
comprehensive income
|
2
|
―
|
―
|
2
|
|||||
Net other comprehensive income
|
2
|
―
|
―
|
2
|
|||||
Balance as of September 30, 2014
|
$
|
(3)
|
$
|
1
|
$
|
(14)
|
$
|
(16)
|
|
(1)
|
All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests.
|
RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
|
||||||||||||
(Dollars in millions)
|
||||||||||||
Details about accumulated
|
Amounts reclassified
|
|||||||||||
other comprehensive income (loss)
|
from accumulated other
|
Affected line item on Condensed
|
||||||||||
components
|
comprehensive income (loss)
|
Consolidated Statements of Operations
|
||||||||||
Three months ended September 30,
|
||||||||||||
2015
|
2014
|
|||||||||||
Sempra Energy Consolidated:
|
||||||||||||
Financial instruments:
|
||||||||||||
Interest rate and foreign exchange instruments
|
$
|
5
|
$
|
8
|
Interest Expense
|
|||||||
Interest rate instruments
|
―
|
(5)
|
Gain on Sale of Equity Interests and Assets
|
|||||||||
Interest rate instruments
|
3
|
2
|
Equity Earnings, Before Income Tax
|
|||||||||
Commodity contracts not subject
|
Revenues: Energy-Related
|
|||||||||||
to rate recovery
|
(3)
|
(2)
|
Businesses
|
|||||||||
Total before income tax
|
5
|
3
|
||||||||||
(1)
|
(1)
|
Income Tax Expense
|
||||||||||
Net of income tax
|
4
|
2
|
||||||||||
(3)
|
(3)
|
Earnings Attributable to Noncontrolling Interests
|
||||||||||
$
|
1
|
$
|
(1)
|
|||||||||
Pension and other postretirement benefits:
|
||||||||||||
Amortization of actuarial loss
|
$
|
7
|
$
|
8
|
See note (1) below
|
|||||||
(2)
|
(3)
|
Income Tax Expense
|
||||||||||
Net of income tax
|
$
|
5
|
$
|
5
|
||||||||
|
||||||||||||
Total reclassifications for the period, net of tax
|
$
|
6
|
$
|
4
|
||||||||
SDG&E:
|
||||||||||||
Financial instruments:
|
||||||||||||
Interest rate instruments
|
$
|
3
|
$
|
3
|
Interest Expense
|
|||||||
(3)
|
(3)
|
Earnings Attributable to Noncontrolling Interest
|
||||||||||
$
|
―
|
$
|
―
|
|||||||||
Pension and other postretirement benefits:
|
||||||||||||
Amortization of actuarial loss
|
$
|
―
|
$
|
1
|
See note (1) below
|
|||||||
―
|
―
|
Income Tax Expense
|
||||||||||
Net of income tax
|
$
|
―
|
$
|
1
|
||||||||
|
||||||||||||
Total reclassifications for the period, net of tax
|
$
|
―
|
$
|
1
|
||||||||
SoCalGas:
|
||||||||||||
Pension and other postretirement benefits:
|
||||||||||||
Amortization of actuarial loss
|
$
|
―
|
$
|
4
|
See note (1) below
|
|||||||
―
|
(2)
|
Income Tax Expense
|
||||||||||
Net of income tax
|
$
|
―
|
$
|
2
|
||||||||
|
||||||||||||
Total reclassifications for the period, net of tax
|
$
|
―
|
$
|
2
|
||||||||
(1)
|
Amounts are included in the computation of net periodic benefit cost (see "Pension and Other Postretirement Benefits" above).
|
RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Details about accumulated
|
Amount reclassified
|
||||||||||
other comprehensive income (loss)
|
from accumulated other
|
Affected line item on Condensed
|
|||||||||
components
|
comprehensive income (loss)
|
Consolidated Statements of Operations
|
|||||||||
Nine months ended September 30,
|
|||||||||||
2015
|
2014
|
||||||||||
Sempra Energy Consolidated:
|
|||||||||||
Financial instruments:
|
|||||||||||
Interest rate and foreign exchange instruments
|
$
|
14
|
$
|
17
|
Interest Expense
|
||||||
Interest rate instruments
|
―
|
(3)
|
Gain on Sale of Equity Interests and Assets
|
||||||||
Interest rate instruments
|
9
|
7
|
Equity Earnings, Before Income Tax
|
||||||||
Commodity contracts not subject to
|
Revenues: Energy-Related
|
||||||||||
rate recovery
|
(10)
|
8
|
Businesses
|
||||||||
Total before income tax
|
13
|
29
|
|||||||||
(1)
|
(8)
|
Income Tax Expense
|
|||||||||
Net of income tax
|
12
|
21
|
|||||||||
(10)
|
(8)
|
Earnings Attributable to Noncontrolling Interests
|
|||||||||
$
|
2
|
$
|
13
|
||||||||
Pension and other postretirement benefits:
|
|||||||||||
Amortization of actuarial loss
|
$
|
11
|
$
|
21
|
See note (1) below
|
||||||
(4)
|
(8)
|
Income Tax Expense
|
|||||||||
Net of income tax
|
$
|
7
|
$
|
13
|
|||||||
|
|||||||||||
Total reclassifications for the period, net of tax
|
$
|
9
|
$
|
26
|
|||||||
SDG&E:
|
|||||||||||
Financial instruments:
|
|||||||||||
Interest rate instruments
|
$
|
9
|
$
|
8
|
Interest Expense
|
||||||
(9)
|
(8)
|
Earnings Attributable to Noncontrolling Interest
|
|||||||||
$
|
―
|
$
|
―
|
||||||||
Pension and other postretirement benefits:
|
|||||||||||
Amortization of actuarial loss
|
$
|
―
|
$
|
3
|
See note (1) below
|
||||||
―
|
(1)
|
Income Tax Expense
|
|||||||||
Net of income tax
|
$
|
―
|
$
|
2
|
|||||||
Total reclassifications for the period, net of tax
|
$
|
―
|
$
|
2
|
|||||||
SoCalGas:
|
|||||||||||
Pension and other postretirement benefits:
|
|||||||||||
Amortization of actuarial loss
|
$
|
―
|
$
|
4
|
See note (1) below
|
||||||
―
|
(2)
|
Income Tax Expense
|
|||||||||
Net of income tax
|
$
|
―
|
$
|
2
|
|||||||
Total reclassifications for the period, net of tax
|
$
|
―
|
$
|
2
|
|||||||
(1)
|
Amounts are included in the computation of net periodic benefit cost (see "Pension and Other Postretirement Benefits" above).
|
SHAREHOLDERS’ EQUITY AND NONCONTROLLING INTERESTS ― SEMPRA ENERGY CONSOLIDATED
|
|||||||
(Dollars in millions)
|
|||||||
Sempra Energy
|
Non-
|
||||||
shareholders’
|
controlling
|
Total
|
|||||
equity
|
interests(1)
|
equity
|
|||||
Balance at December 31, 2014
|
$
|
11,326
|
$
|
774
|
$
|
12,100
|
|
Comprehensive income
|
717
|
56
|
773
|
||||
Preferred dividends of subsidiary
|
(1)
|
―
|
(1)
|
||||
Share-based compensation expense
|
39
|
―
|
39
|
||||
Common stock dividends declared
|
(520)
|
―
|
(520)
|
||||
Issuance of common stock
|
82
|
―
|
82
|
||||
Repurchases of common stock
|
(74)
|
―
|
(74)
|
||||
Tax benefit related to share-based compensation
|
56
|
―
|
56
|
||||
Equity contributed by noncontrolling interest
|
―
|
1
|
1
|
||||
Distributions to noncontrolling interests
|
―
|
(60)
|
(60)
|
||||
Balance at September 30, 2015
|
$
|
11,625
|
$
|
771
|
$
|
12,396
|
|
Balance at December 31, 2013
|
$
|
11,008
|
$
|
842
|
$
|
11,850
|
|
Comprehensive income
|
722
|
66
|
788
|
||||
Preferred dividends of subsidiary
|
(1)
|
―
|
(1)
|
||||
Share-based compensation expense
|
35
|
―
|
35
|
||||
Common stock dividends declared
|
(486)
|
―
|
(486)
|
||||
Issuance of common stock
|
71
|
―
|
71
|
||||
Repurchases of common stock
|
(38)
|
―
|
(38)
|
||||
Tax benefit related to share-based compensation
|
22
|
―
|
22
|
||||
Equity contributed by noncontrolling interest
|
―
|
1
|
1
|
||||
Distributions to noncontrolling interests
|
―
|
(85)
|
(85)
|
||||
Balance at September 30, 2014
|
$
|
11,333
|
$
|
824
|
$
|
12,157
|
|
(1)
|
Noncontrolling interests include the preferred stock of SoCalGas and other noncontrolling interests as listed in the table below under "Other Noncontrolling Interests."
|
SHAREHOLDER'S EQUITY AND NONCONTROLLING INTEREST ― SDG&E
|
||||||
(Dollars in millions)
|
||||||
SDG&E
|
Non-
|
|||||
shareholder’s
|
controlling
|
Total
|
||||
equity
|
interest
|
equity
|
||||
Balance at December 31, 2014
|
$
|
4,932
|
$
|
60
|
$
|
4,992
|
Comprehensive income
|
443
|
20
|
463
|
|||
Common stock dividends declared
|
(150)
|
―
|
(150)
|
|||
Distributions to noncontrolling interest
|
―
|
(16)
|
(16)
|
|||
Balance at September 30, 2015
|
$
|
5,225
|
$
|
64
|
$
|
5,289
|
Balance at December 31, 2013
|
$
|
4,628
|
$
|
91
|
$
|
4,719
|
Comprehensive income
|
381
|
23
|
404
|
|||
Distributions to noncontrolling interest
|
―
|
(37)
|
(37)
|
|||
Balance at September 30, 2014
|
$
|
5,009
|
$
|
77
|
$
|
5,086
|
SHAREHOLDERS' EQUITY ― SOCALGAS
|
||
(Dollars in millions)
|
||
SoCalGas
|
||
shareholders'
|
||
equity
|
||
Balance at December 31, 2014
|
$
|
2,781
|
Comprehensive income
|
277
|
|
Preferred stock dividends declared
|
(1)
|
|
Common stock dividends declared
|
(50)
|
|
Balance at September 30, 2015
|
$
|
3,007
|
Balance at December 31, 2013
|
$
|
2,549
|
Comprehensive income
|
259
|
|
Preferred stock dividends declared
|
(1)
|
|
Balance at September 30, 2014
|
$
|
2,807
|
OTHER NONCONTROLLING INTERESTS
|
|||||||||
(Dollars in millions)
|
|||||||||
Percent ownership held by others
|
|||||||||
September 30,
|
December 31,
|
September 30,
|
December 31,
|
||||||
2015
|
2014
|
2015
|
2014
|
||||||
SDG&E:
|
|||||||||
Otay Mesa VIE
|
100
|
%
|
100
|
%
|
$
|
64
|
$
|
60
|
|
Sempra South American Utilities:
|
|||||||||
Chilquinta Energía subsidiaries(1)
|
23.5 – 43.4
|
23.6 – 43.4
|
20
|
23
|
|||||
Luz del Sur
|
16.4
|
16.4
|
171
|
177
|
|||||
Tecsur
|
9.8
|
9.8
|
3
|
4
|
|||||
Sempra Mexico:
|
|||||||||
IEnova, S.A.B. de C.V.
|
18.9
|
18.9
|
455
|
452
|
|||||
Sempra Natural Gas:
|
|||||||||
Bay Gas Storage Company, Ltd.
|
9.1
|
9.1
|
25
|
23
|
|||||
Liberty Gas Storage, LLC
|
23.7
|
25.0
|
12
|
14
|
|||||
Southern Gas Transmission Company
|
49.0
|
49.0
|
1
|
1
|
|||||
Total Sempra Energy
|
$
|
751
|
$
|
754
|
|||||
(1)
|
Chilquinta Energía has four subsidiaries with noncontrolling interests held by others. Percentage range reflects the highest and lowest ownership percentages amongst these subsidiaries.
|
DUE FROM UNCONSOLIDATED AFFILIATES(1)
|
|||||
(Dollars in millions)
|
|||||
September 30, 2015
|
December 31, 2014
|
||||
Sempra South American Utilities:
|
|||||
Eletrans S.A.:
|
|||||
4% Note(2)
|
$
|
65
|
$
|
41
|
|
Sempra Mexico:
|
|||||
Affiliate of joint venture with Petróleos Mexicanos(3):
|
|||||
Note due November 13, 2017(4)(5)
|
3
|
44
|
|||
Note due November 14, 2018(4)
|
41
|
40
|
|||
Note due November 14, 2018(4)
|
34
|
33
|
|||
Note due November 14, 2018(4)
|
8
|
8
|
|||
Energía Sierra Juárez:
|
|||||
Note due June 15, 2018(6)
|
24
|
22
|
|||
Other(7)
|
3
|
38
|
|||
Total
|
$
|
178
|
$
|
226
|
|
(1)
|
Amounts include principal balances plus accumulated interest outstanding.
|
||||
(2)
|
U.S. dollar-denominated loan, at a fixed interest rate with no stated maturity date, to provide project financing for the construction of transmission lines at Eletrans S.A., an affiliate of Chilquinta Energía.
|
||||
(3)
|
Petróleos Mexicanos (or PEMEX, the Mexican state-owned oil company).
|
||||
(4)
|
U.S. dollar-denominated loan, at a variable interest rate based on a 30-day LIBOR plus 450 basis points (4.69 percent at September 30, 2015), to finance the Los Ramones Norte pipeline project.
|
||||
(5)
|
In May 2015, $41 million was paid with proceeds from project financing at the affiliate.
|
||||
(6)
|
U.S. dollar-denominated loan, at a variable interest rate based on a 30-day LIBOR plus 637.5 basis points (6.57 percent at September 30, 2015), to finance the first phase of the Energía Sierra Juárez wind project.
|
||||
(7)
|
Amounts represent accounts receivable from various Sempra Renewables and Sempra Mexico joint venture investments.
|
AMOUNTS DUE TO AND FROM AFFILIATES AT SDG&E AND SOCALGAS
|
||||||
(Dollars in millions)
|
||||||
September 30, 2015
|
December 31, 2014
|
|||||
SDG&E:
|
||||||
Current:
|
||||||
Due from SoCalGas
|
$
|
1
|
$
|
―
|
||
Due from various affiliates
|
―
|
1
|
||||
$
|
1
|
$
|
1
|
|||
Due to Sempra Energy
|
$
|
22
|
$
|
17
|
||
Due to SoCalGas
|
―
|
4
|
||||
$
|
22
|
$
|
21
|
|||
Income taxes due from Sempra Energy(1)
|
$
|
41
|
$
|
16
|
||
SoCalGas:
|
||||||
Current:
|
||||||
Due from Sempra Energy(2)
|
$
|
220
|
$
|
―
|
||
Due from SDG&E
|
―
|
4
|
||||
$
|
220
|
$
|
4
|
|||
Due to affiliate
|
$
|
50
|
$
|
―
|
||
Due to SDG&E
|
1
|
―
|
||||
Due to Sempra Energy
|
―
|
13
|
||||
$
|
51
|
$
|
13
|
|||
Income taxes due from Sempra Energy(1)
|
$
|
29
|
$
|
9
|
||
(1)
|
SDG&E and SoCalGas are included in the consolidated income tax return of Sempra Energy and are allocated income tax expense from Sempra Energy in an amount equal to that which would result from each company having always filed a separate return.
|
|||||
(2)
|
Net receivable includes a loan to Sempra Energy of $250 million at September 30, 2015 at an interest rate of 0.10 percent.
|
REVENUES FROM UNCONSOLIDATED AFFILIATES AT SDG&E AND SOCALGAS
|
||||||||
(Dollars in millions)
|
||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
|||||||
2015
|
2014
|
2015
|
2014
|
|||||
SDG&E
|
$
|
3
|
$
|
2
|
$
|
8
|
$
|
8
|
SoCalGas
|
19
|
17
|
55
|
51
|
OTHER INCOME, NET
|
|||||||||
(Dollars in millions)
|
|||||||||
Three months ended
September 30,
|
Nine months ended
September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
||||||
Sempra Energy Consolidated:
|
|||||||||
Allowance for equity funds used during construction
|
$
|
26
|
$
|
28
|
$
|
84
|
$
|
77
|
|
Investment (losses) gains(1)
|
(12)
|
(3)
|
(5)
|
20
|
|||||
(Losses) gains on interest rate and foreign exchange instruments, net
|
(4)
|
(6)
|
(7)
|
3
|
|||||
Foreign currency losses
|
(3)
|
(2)
|
(6)
|
(1)
|
|||||
Sale of other investments
|
2
|
1
|
8
|
1
|
|||||
Electrical infrastructure relocation income(2)
|
―
|
4
|
4
|
7
|
|||||
Regulatory interest, net(3)
|
1
|
2
|
3
|
5
|
|||||
Sundry, net
|
2
|
5
|
7
|
6
|
|||||
Total
|
$
|
12
|
$
|
29
|
$
|
88
|
$
|
118
|
|
SDG&E:
|
|||||||||
Allowance for equity funds used during construction
|
$
|
9
|
$
|
8
|
$
|
27
|
$
|
26
|
|
Regulatory interest, net(3)
|
1
|
2
|
3
|
5
|
|||||
Sundry, net
|
(2)
|
(1)
|
(4)
|
(2)
|
|||||
Total
|
$
|
8
|
$
|
9
|
$
|
26
|
$
|
29
|
|
SoCalGas:
|
|||||||||
Allowance for equity funds used during construction
|
$
|
10
|
$
|
7
|
$
|
29
|
$
|
18
|
|
Sundry, net
|
(2)
|
(1)
|
(4)
|
(5)
|
|||||
Total
|
$
|
8
|
$
|
6
|
$
|
25
|
$
|
13
|
|
(1)
|
Represents investment (losses) gains on dedicated assets in support of our executive retirement and deferred compensation plans. These amounts are partially offset by corresponding changes in compensation expense related to the plans.
|
||||||||
(2)
|
Income at Luz del Sur associated with the relocation of electrical infrastructure.
|
||||||||
(3)
|
Interest on regulatory balancing accounts.
|
INCOME TAX EXPENSE (BENEFIT) AND EFFECTIVE INCOME TAX RATES
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Income tax
|
Effective
|
Effective
|
|||||||||
expense
|
income
|
Income tax
|
income
|
||||||||
(benefit)
|
tax rate
|
expense
|
tax rate
|
||||||||
Three months ended September 30,
|
|||||||||||
2015
|
2014
|
||||||||||
Sempra Energy Consolidated
|
$
|
15
|
6
|
%
|
$
|
71
|
16
|
%
|
|||
SDG&E
|
75
|
29
|
65
|
28
|
|||||||
SoCalGas
|
(20)
|
71
|
44
|
31
|
|||||||
Nine months ended September 30,
|
|||||||||||
2015
|
2014
|
||||||||||
Sempra Energy Consolidated
|
$
|
276
|
22
|
%
|
$
|
291
|
24
|
%
|
|||
SDG&E
|
217
|
32
|
217
|
35
|
|||||||
SoCalGas
|
91
|
25
|
110
|
30
|
§
|
utility self-developed software expenditures
|
§
|
repairs to certain utility plant assets
|
§
|
renewable energy income tax credits
|
§
|
deferred income tax benefits related to renewable energy projects
|
§
|
exclusions from taxable income of the equity portion of AFUDC
|
§
|
depreciation on a certain portion of utility plant assets
|
§
|
U.S. tax on repatriation of current year earnings from non-U.S. subsidiaries
|
§
|
$12 million higher favorable resolution of prior years’ income tax items in 2015;
|
§
|
$9 million higher income tax benefit in 2015 from foreign currency translation and inflation adjustments; and
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries, as discussed below; offset by
|
§
|
$25 million income tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments.
|
§
|
$17 million charge in 2014 to reduce certain tax regulatory assets attributed to SDG&E’s investment in San Onofre Nuclear Generating Station (SONGS) that we discuss in Note 9;
|
§
|
$19 million higher favorable resolution of prior years’ income tax items in 2015;
|
§
|
$22 million higher income tax benefit in 2015 from foreign currency translation and inflation adjustments; and
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries, as discussed below; offset by
|
§
|
$25 million income tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments.
|
§
|
higher unfavorable impact on our effective tax rate in 2015 from the reversal through book depreciation of previously recognized tax benefits for a certain portion of utility fixed assets; offset by
|
§
|
higher exclusions from taxable income of the equity portion of AFUDC.
|
§
|
$17 million charge in 2014 to reduce certain tax regulatory assets attributed to SDG&E’s investment in SONGS that we discuss in Note 9; and
|
§
|
$9 million higher favorable resolution of prior years’ income tax items in 2015.
|
§
|
$11 million higher favorable resolution of prior years’ income tax items in 2015; and
|
§
|
lower flow-through component of state income taxes.
|
§
|
$14 million higher favorable resolution of prior years’ income tax items in 2015; and
|
§
|
higher exclusions from taxable income of the equity portion of AFUDC.
|
§
|
repairs expenditures related to a certain portion of utility plant assets
|
§
|
the equity portion of AFUDC
|
§
|
a portion of the cost of removal of utility plant assets
|
§
|
utility self-developed software expenditures
|
§
|
depreciation on a certain portion of utility plant assets
|
§
|
state income taxes
|
§
|
The California Utilities use energy derivatives, both natural gas and electricity, for the benefit of customers, with the objective of managing price risk and basis risks, and lowering natural gas and electricity costs. These derivatives include fixed price natural gas and electricity positions, options, and basis risk instruments, which are either exchange-traded or over-the-counter financial instruments, or bilateral physical transactions. This activity is governed by risk management and transacting activity plans that have been filed with and approved by the CPUC. Natural gas and electricity derivative activities are recorded as commodity costs that are offset by regulatory account balances and are recovered in rates. Net commodity cost impacts on the Condensed Consolidated Statements of Operations are reflected in Cost of Electric Fuel and Purchased Power or in Cost of Natural Gas.
|
§
|
SDG&E is allocated and may purchase congestion revenue rights (CRRs), which serve to reduce the regional electricity price volatility risk that may result from local transmission capacity constraints. Unrealized gains and losses do not impact earnings, as they are offset by regulatory account balances. Realized gains and losses associated with CRRs are recorded in Cost of Electric Fuel and Purchased Power, which is recoverable in rates, on the Condensed Consolidated Statements of Operations.
|
§
|
Sempra Mexico and Sempra Natural Gas may use natural gas and electricity derivatives, as appropriate, to optimize the earnings of their assets which support the following businesses: liquefied natural gas (LNG), natural gas transportation, power generation, and Sempra Natural Gas’ storage. Gains and losses associated with undesignated derivatives are recognized in Energy-Related Businesses Revenues or in Cost of Natural Gas, Electric Fuel and Purchased Power on the Condensed Consolidated Statements of Operations. Certain of these derivatives may also be designated as cash flow hedges. Sempra Mexico also uses natural gas energy derivatives with the objective of managing price risk and lowering natural gas prices at its Mexican distribution operations. These derivatives, which are recorded as commodity costs that are offset by regulatory account balances and recovered in rates, are recognized in Cost of Natural Gas on the Condensed Consolidated Statements of Operations.
|
§
|
From time to time, our various businesses, including the California Utilities, may use other energy derivatives to hedge exposures such as the price of vehicle fuel.
|
NET ENERGY DERIVATIVE VOLUMES
|
|||||
Segment and Commodity
|
September 30, 2015
|
December 31, 2014
|
|||
California Utilities:
|
|||||
SDG&E:
|
|||||
Natural gas
|
59 million MMBtu
|
55 million MMBtu
|
(1)
|
||
Electricity
|
1 million MWh
|
―
|
(2)
|
||
Congestion revenue rights
|
24 million MWh
|
27 million MWh
|
|||
SoCalGas – natural gas
|
1 million MMBtu
|
1 million MMBtu
|
|||
Energy-Related Businesses:
|
|
|
|||
Sempra Natural Gas – natural gas
|
39 million MMBtu
|
29 million MMBtu
|
|||
(1)
|
Million British thermal units
|
||||
(2)
|
Megawatt hours
|
INTEREST RATE DERIVATIVES
|
|||||||
(Dollars in millions)
|
|||||||
September 30, 2015
|
December 31, 2014
|
||||||
Notional debt
|
Maturities
|
Notional debt
|
Maturities
|
||||
Sempra Energy Consolidated:
|
|||||||
Cash flow hedges(1)
|
$
|
389
|
2015-2028
|
$
|
399
|
2015-2028
|
|
Fair value hedges
|
300
|
2016
|
300
|
2016
|
|||
SDG&E:
|
|||||||
Cash flow hedge(1)
|
317
|
2015-2019
|
325
|
2015-2019
|
|||
(1)
|
Includes Otay Mesa VIE. All of SDG&E’s interest rate derivatives relate to Otay Mesa VIE.
|
DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||||||
(Dollars in millions)
|
|||||||||
September 30, 2015
|
|||||||||
Deferred
|
|||||||||
credits
|
|||||||||
Current
|
Current
|
and other
|
|||||||
assets:
|
liabilities:
|
liabilities:
|
|||||||
Fixed-price
|
Investments
|
Fixed-price
|
Fixed-price
|
||||||
contracts
|
and other
|
contracts
|
contracts
|
||||||
and other
|
assets:
|
and other
|
and other
|
||||||
derivatives(1)
|
Sundry
|
derivatives(2)
|
derivatives
|
||||||
Sempra Energy Consolidated:
|
|||||||||
Derivatives designated as hedging instruments:
|
|||||||||
Interest rate and foreign exchange instruments(3)
|
$
|
7
|
$
|
―
|
$
|
(16)
|
$
|
(159)
|
|
Commodity contracts not subject to rate recovery
|
6
|
―
|
―
|
―
|
|||||
Derivatives not designated as hedging instruments:
|
|||||||||
Interest rate and foreign exchange instruments
|
―
|
―
|
(3)
|
―
|
|||||
Commodity contracts not subject to rate recovery
|
166
|
31
|
(147)
|
(18)
|
|||||
Associated offsetting commodity contracts
|
(137)
|
(18)
|
137
|
18
|
|||||
Associated offsetting cash collateral
|
―
|
―
|
3
|
―
|
|||||
Commodity contracts subject to rate recovery
|
7
|
87
|
(59)
|
(65)
|
|||||
Associated offsetting commodity contracts
|
(1)
|
(1)
|
1
|
1
|
|||||
Associated offsetting cash collateral
|
―
|
―
|
25
|
28
|
|||||
Net amounts presented on the balance sheet
|
48
|
99
|
(59)
|
(195)
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
not subject to rate recovery
|
3
|
―
|
―
|
―
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
subject to rate recovery
|
15
|
―
|
―
|
―
|
|||||
Total(4)
|
$
|
66
|
$
|
99
|
$
|
(59)
|
$
|
(195)
|
|
SDG&E:
|
|||||||||
Derivatives designated as hedging instruments:
|
|||||||||
Interest rate instruments(3)
|
$
|
―
|
$
|
―
|
$
|
(15)
|
$
|
(29)
|
|
Derivatives not designated as hedging instruments:
|
|||||||||
Commodity contracts not subject to rate recovery
|
―
|
―
|
(1)
|
―
|
|||||
Associated offsetting cash collateral
|
―
|
―
|
1
|
―
|
|||||
Commodity contracts subject to rate recovery
|
6
|
87
|
(59)
|
(65)
|
|||||
Associated offsetting commodity contracts
|
(1)
|
(1)
|
1
|
1
|
|||||
Associated offsetting cash collateral
|
―
|
―
|
25
|
28
|
|||||
Net amounts presented on the balance sheet
|
5
|
86
|
(48)
|
(65)
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
not subject to rate recovery
|
1
|
―
|
―
|
―
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
subject to rate recovery
|
14
|
―
|
―
|
―
|
|||||
Total(4)
|
$
|
20
|
$
|
86
|
$
|
(48)
|
$
|
(65)
|
|
SoCalGas:
|
|||||||||
Derivatives not designated as hedging instruments:
|
|||||||||
Commodity contracts not subject to rate recovery
|
$
|
―
|
$
|
―
|
$
|
(2)
|
$
|
―
|
|
Associated offsetting cash collateral
|
―
|
―
|
2
|
―
|
|||||
Commodity contracts subject to rate recovery
|
1
|
―
|
―
|
―
|
|||||
Net amounts presented on the balance sheet
|
1
|
―
|
―
|
―
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
not subject to rate recovery
|
1
|
―
|
―
|
―
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
subject to rate recovery
|
1
|
―
|
―
|
―
|
|||||
Total
|
$
|
3
|
$
|
―
|
$
|
―
|
$
|
―
|
|
(1)
|
Included in Current Assets: Other for SoCalGas.
|
||||||||
(2)
|
Included in Current Liabilities: Other for SoCalGas.
|
||||||||
(3)
|
Includes Otay Mesa VIE. All of SDG&E’s amounts relate to Otay Mesa VIE.
|
||||||||
(4)
|
Normal purchase contracts previously measured at fair value are excluded.
|
DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
|
|||||||||
(Dollars in millions)
|
|||||||||
December 31, 2014
|
|||||||||
Deferred
|
|||||||||
credits
|
|||||||||
Current
|
Current
|
and other
|
|||||||
assets:
|
liabilities:
|
liabilities:
|
|||||||
Fixed-price
|
Investments
|
Fixed-price
|
Fixed-price
|
||||||
contracts
|
and other
|
contracts
|
contracts
|
||||||
and other
|
assets:
|
and other
|
and other
|
||||||
derivatives(1)
|
Sundry
|
derivatives(2)
|
derivatives
|
||||||
Sempra Energy Consolidated:
|
|||||||||
Derivatives designated as hedging instruments:
|
|||||||||
Interest rate and foreign exchange instruments(3)
|
$
|
10
|
$
|
3
|
$
|
(17)
|
$
|
(109)
|
|
Commodity contracts not subject to rate recovery
|
25
|
―
|
―
|
―
|
|||||
Derivatives not designated as hedging instruments:
|
|||||||||
Interest rate instruments
|
8
|
27
|
(7)
|
(22)
|
|||||
Commodity contracts not subject to rate recovery
|
143
|
32
|
(135)
|
(29)
|
|||||
Associated offsetting commodity contracts
|
(129)
|
(27)
|
129
|
27
|
|||||
Associated offsetting cash collateral
|
(11)
|
―
|
―
|
―
|
|||||
Commodity contracts subject to rate recovery
|
36
|
76
|
(36)
|
(20)
|
|||||
Associated offsetting commodity contracts
|
(3)
|
(1)
|
3
|
1
|
|||||
Associated offsetting cash collateral
|
―
|
―
|
23
|
13
|
|||||
Net amounts presented on the balance sheet
|
79
|
110
|
(40)
|
(139)
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
subject to rate recovery
|
14
|
―
|
―
|
―
|
|||||
Total(4)
|
$
|
93
|
$
|
110
|
$
|
(40)
|
$
|
(139)
|
|
SDG&E:
|
|||||||||
Derivatives designated as hedging instruments:
|
|||||||||
Interest rate instruments(3)
|
$
|
―
|
$
|
―
|
$
|
(16)
|
$
|
(31)
|
|
Derivatives not designated as hedging instruments:
|
|||||||||
Commodity contracts subject to rate recovery
|
32
|
76
|
(32)
|
(20)
|
|||||
Associated offsetting commodity contracts
|
―
|
(1)
|
―
|
1
|
|||||
Associated offsetting cash collateral
|
―
|
―
|
23
|
13
|
|||||
Net amounts presented on the balance sheet
|
32
|
75
|
(25)
|
(37)
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
subject to rate recovery
|
12
|
―
|
―
|
―
|
|||||
Total(4)
|
$
|
44
|
$
|
75
|
$
|
(25)
|
$
|
(37)
|
|
SoCalGas:
|
|||||||||
Derivatives not designated as hedging instruments:
|
|||||||||
Commodity contracts subject to rate recovery
|
$
|
4
|
$
|
―
|
$
|
(4)
|
$
|
―
|
|
Associated offsetting commodity contracts
|
(3)
|
―
|
3
|
―
|
|||||
Net amounts presented on the balance sheet
|
1
|
―
|
(1)
|
―
|
|||||
Additional cash collateral for commodity contracts
|
|||||||||
subject to rate recovery
|
2
|
―
|
―
|
―
|
|||||
Total
|
$
|
3
|
$
|
―
|
$
|
(1)
|
$
|
―
|
|
(1)
|
Included in Current Assets: Other for SoCalGas.
|
||||||||
(2)
|
Included in Current Liabilities: Other for SoCalGas.
|
||||||||
(3)
|
Includes Otay Mesa VIE. All of SDG&E’s amounts relate to Otay Mesa VIE.
|
||||||||
(4)
|
Normal purchase contracts previously measured at fair value are excluded.
|
FAIR VALUE HEDGE IMPACT ON THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||
(Dollars in millions)
|
||||||||||
Pretax gain (loss) on derivatives recognized in earnings
|
||||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
|||||||||
Location
|
2015
|
2014
|
2015
|
2014
|
||||||
Sempra Energy Consolidated:
|
||||||||||
Interest rate instruments
|
Interest Expense
|
$
|
1
|
$
|
1
|
$
|
5
|
$
|
6
|
|
Interest rate instruments
|
Other Income, Net
|
―
|
(1)
|
(2)
|
―
|
|||||
Total(1)
|
$
|
1
|
$
|
―
|
$
|
3
|
$
|
6
|
||
(1)
|
There was no hedge ineffectiveness on these swaps in either the three months or nine months ended September 30, 2015 and negligible gains and $9 million of gains from hedge ineffectiveness in the three months and nine months ended September 30, 2014, respectively. All other changes in the fair value of the interest rate swap agreements are exactly offset by changes in the fair value of the underlying long-term debt and are recorded in Other Income, Net.
|
CASH FLOW HEDGE IMPACT ON THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Pretax gain (loss) recognized
|
Pretax gain (loss) reclassified from
|
||||||||||
in OCI (effective portion)
|
AOCI into earnings (effective portion)
|
||||||||||
Three months ended September 30,
|
Three months ended September 30,
|
||||||||||
2015
|
2014
|
Location
|
2015
|
2014
|
|||||||
Sempra Energy Consolidated:
|
|||||||||||
Interest rate and foreign
|
|||||||||||
exchange instruments(1)(2)
|
$
|
(10)
|
$
|
(5)
|
Interest Expense
|
$
|
(5)
|
$
|
(8)
|
||
|
Gain on Sale of Equity Interests
|
||||||||||
Interest rate instruments
|
―
|
5
|
and Assets
|
―
|
5
|
||||||
Equity Earnings,
|
|||||||||||
Interest rate instruments
|
(134)
|
(4)
|
Before Income Tax
|
(3)
|
(2)
|
||||||
Commodity contracts not subject
|
Revenues: Energy-Related
|
||||||||||
to rate recovery
|
6
|
1
|
Businesses
|
3
|
2
|
||||||
Total(2)
|
$
|
(138)
|
$
|
(3)
|
$
|
(5)
|
$
|
(3)
|
|||
SDG&E:
|
|||||||||||
Interest rate instruments(1)(2)
|
$
|
(4)
|
$
|
1
|
Interest Expense
|
$
|
(3)
|
$
|
(3)
|
||
Nine months ended September 30,
|
Nine months ended September 30,
|
||||||||||
2015
|
2014
|
Location
|
2015
|
2014
|
|||||||
Sempra Energy Consolidated:
|
|||||||||||
Interest rate and foreign
|
|||||||||||
exchange instruments(1)(2)
|
$
|
(22)
|
$
|
(15)
|
Interest Expense
|
$
|
(14)
|
$
|
(17)
|
||
Gain on Sale of Equity Interests
|
|||||||||||
Interest rate instruments
|
―
|
3
|
and Assets
|
―
|
3
|
||||||
Equity Earnings,
|
|||||||||||
Interest rate instruments
|
(123)
|
(34)
|
Before Income Tax
|
(9)
|
(7)
|
||||||
Commodity contracts not subject
|
Revenues: Energy-Related
|
||||||||||
to rate recovery
|
6
|
(5)
|
Businesses
|
10
|
(8)
|
||||||
Total(2)
|
$
|
(139)
|
$
|
(51)
|
$
|
(13)
|
$
|
(29)
|
|||
SDG&E:
|
|||||||||||
Interest rate instruments(1)(2)
|
$
|
(9)
|
$
|
(5)
|
Interest Expense
|
$
|
(9)
|
$
|
(8)
|
||
(1)
|
Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE.
|
||||||||||
(2)
|
There were negligible losses from ineffectiveness related to these hedges in 2015 and 2014.
|
UNDESIGNATED DERIVATIVE IMPACT ON THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
|
||||||||||
(Dollars in millions)
|
||||||||||
Pretax gain (loss) on derivatives recognized in earnings
|
||||||||||
Three months ended
September 30,
|
Nine months ended
September 30,
|
|||||||||
Location
|
2015
|
2014
|
2015
|
2014
|
||||||
Sempra Energy Consolidated:
|
||||||||||
Interest rate and foreign exchange
|
||||||||||
instruments
|
Other Income, Net
|
$
|
(4)
|
$
|
(6)
|
$
|
(7)
|
$
|
(6)
|
|
Foreign exchange instruments
|
Equity Earnings,
|
|||||||||
Net of Income Tax
|
(3)
|
(2)
|
(4)
|
(4)
|
||||||
Commodity contracts not subject
|
Revenues: Energy-Related
|
|||||||||
to rate recovery
|
Businesses
|
21
|
3
|
33
|
2
|
|||||
Commodity contracts not subject
|
Cost of Natural Gas, Electric Fuel
|
|||||||||
to rate recovery
|
and Purchased Power
|
―
|
1
|
―
|
3
|
|||||
Commodity contracts not subject
|
||||||||||
to rate recovery
|
Operation and Maintenance
|
(2)
|
―
|
(1)
|
―
|
|||||
Commodity contracts subject
|
Cost of Electric Fuel
|
|||||||||
to rate recovery
|
and Purchased Power
|
(27)
|
(1)
|
(100)
|
19
|
|||||
Commodity contracts subject
|
||||||||||
to rate recovery
|
Cost of Natural Gas
|
―
|
1
|
1
|
2
|
|||||
Total
|
$
|
(15)
|
$
|
(4)
|
$
|
(78)
|
$
|
16
|
||
SDG&E:
|
||||||||||
Commodity contracts not subject
|
||||||||||
to rate recovery
|
Operation and Maintenance
|
$
|
(1)
|
$
|
―
|
$
|
(1)
|
$
|
―
|
|
Commodity contracts subject
|
Cost of Electric Fuel
|
|||||||||
to rate recovery
|
and Purchased Power
|
(27)
|
(1)
|
(100)
|
19
|
|||||
Total
|
$
|
(28)
|
$
|
(1)
|
$
|
(101)
|
$
|
19
|
||
SoCalGas:
|
||||||||||
Commodity contracts not subject
|
|
|||||||||
to rate recovery
|
Operation and Maintenance
|
$
|
(1)
|
$
|
―
|
$
|
―
|
$
|
―
|
|
Commodity contracts subject
|
||||||||||
to rate recovery
|
Cost of Natural Gas
|
―
|
1
|
1
|
2
|
|||||
Total
|
$
|
(1)
|
$
|
1
|
$
|
1
|
$
|
2
|
§
|
Nuclear decommissioning trusts reflect the assets of SDG&E’s nuclear decommissioning trusts, excluding cash balances. A third party trustee values the trust assets using prices from a pricing service based on a market approach. We validate these prices by comparison to prices from other independent data sources. Equity and certain debt securities are valued using quoted prices listed on nationally recognized securities exchanges or based on closing prices reported in the active market in which the identical security is traded (Level 1). Other debt securities are valued based on yields that are currently available for comparable securities of issuers with similar credit ratings (Level 2).
|
§
|
We enter into commodity contracts and interest rate derivatives primarily as a means to manage price exposures. We may also manage foreign exchange rate exposures using derivatives. We primarily use a market approach with market participant assumptions to value these derivatives. Market participant assumptions include those about risk, and the risk inherent in the inputs to the valuation techniques. These inputs can be readily observable, market corroborated, or generally unobservable. We have exchange-traded derivatives that are valued based on quoted prices in active markets for the identical instruments (Level 1). We also may have other commodity derivatives that are valued using industry standard models that consider quoted forward prices for commodities, time value, current market and contractual prices for the underlying instruments, volatility factors, and other relevant economic measures (Level 2). Level 3 recurring items relate to CRRs and long-term, fixed-price electricity positions at SDG&E, as we discuss below under “Level 3 Information.” We record commodity derivative contracts that are subject to rate recovery as commodity costs that are offset by regulatory account balances and are recovered in rates.
|
§
|
Investments include marketable securities that we value using a market approach based on closing prices reported in the active market in which the identical security is traded (Level 1).
|
RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Fair value at September 30, 2015
|
|||||||||||
Level 1
|
Level 2
|
Level 3
|
Netting(1)
|
Total
|
|||||||
Assets:
|
|||||||||||
Nuclear decommissioning trusts:
|
|||||||||||
Equity securities
|
$
|
588
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
588
|
|
Debt securities:
|
|||||||||||
Debt securities issued by the U.S. Treasury and other
|
|||||||||||
U.S. government corporations and agencies
|
51
|
44
|
―
|
―
|
95
|
||||||
Municipal bonds
|
―
|
154
|
―
|
―
|
154
|
||||||
Other securities
|
―
|
205
|
―
|
―
|
205
|
||||||
Total debt securities
|
51
|
403
|
―
|
―
|
454
|
||||||
Total nuclear decommissioning trusts(2)
|
639
|
403
|
―
|
―
|
1,042
|
||||||
Interest rate and foreign exchange instruments
|
―
|
7
|
―
|
―
|
7
|
||||||
Commodity contracts not subject to rate recovery
|
31
|
17
|
―
|
3
|
51
|
||||||
Commodity contracts subject to rate recovery
|
―
|
1
|
91
|
15
|
107
|
||||||
Total
|
$
|
670
|
$
|
428
|
$
|
91
|
$
|
18
|
$
|
1,207
|
|
Liabilities:
|
|||||||||||
Interest rate and foreign exchange instruments
|
$
|
―
|
$
|
178
|
$
|
―
|
$
|
―
|
$
|
178
|
|
Commodity contracts not subject to rate recovery
|
8
|
2
|
―
|
(3)
|
7
|
||||||
Commodity contracts subject to rate recovery
|
―
|
67
|
55
|
(53)
|
69
|
||||||
Total
|
$
|
8
|
$
|
247
|
$
|
55
|
$
|
(56)
|
$
|
254
|
|
Fair value at December 31, 2014
|
|||||||||||
Level 1
|
Level 2
|
Level 3
|
Netting(1)
|
Total
|
|||||||
Assets:
|
|||||||||||
Nuclear decommissioning trusts:
|
|||||||||||
Equity securities
|
$
|
655
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
655
|
|
Debt securities:
|
|||||||||||
Debt securities issued by the U.S. Treasury and other
|
|||||||||||
U.S. government corporations and agencies
|
62
|
47
|
―
|
―
|
109
|
||||||
Municipal bonds
|
―
|
129
|
―
|
―
|
129
|
||||||
Other securities
|
―
|
207
|
―
|
―
|
207
|
||||||
Total debt securities
|
62
|
383
|
―
|
―
|
445
|
||||||
Total nuclear decommissioning trusts(2)
|
717
|
383
|
―
|
―
|
1,100
|
||||||
Interest rate and foreign exchange instruments
|
―
|
48
|
―
|
―
|
48
|
||||||
Commodity contracts not subject to rate recovery
|
28
|
16
|
―
|
(11)
|
33
|
||||||
Commodity contracts subject to rate recovery
|
―
|
1
|
107
|
14
|
122
|
||||||
Total
|
$
|
745
|
$
|
448
|
$
|
107
|
$
|
3
|
$
|
1,303
|
|
Liabilities:
|
|||||||||||
Interest rate and foreign exchange instruments
|
$
|
―
|
$
|
155
|
$
|
―
|
$
|
―
|
$
|
155
|
|
Commodity contracts not subject to rate recovery
|
3
|
9
|
―
|
(4)
|
8
|
||||||
Commodity contracts subject to rate recovery
|
―
|
52
|
―
|
(36)
|
16
|
||||||
Total
|
$
|
3
|
$
|
216
|
$
|
―
|
$
|
(40)
|
$
|
179
|
|
(1)
|
Includes the effect of the contractual ability to settle contracts under master netting agreements and with cash collateral, as well as cash collateral not offset.
|
||||||||||
(2)
|
Excludes cash balances and cash equivalents.
|
RECURRING FAIR VALUE MEASURES – SDG&E
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Fair value at September 30, 2015
|
|||||||||||
Level 1
|
Level 2
|
Level 3
|
Netting(1)
|
Total
|
|||||||
Assets:
|
|||||||||||
Nuclear decommissioning trusts:
|
|||||||||||
Equity securities
|
$
|
588
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
588
|
|
Debt securities:
|
|||||||||||
Debt securities issued by the U.S. Treasury and other
|
|||||||||||
U.S. government corporations and agencies
|
51
|
44
|
―
|
―
|
95
|
||||||
Municipal bonds
|
―
|
154
|
―
|
―
|
154
|
||||||
Other securities
|
―
|
205
|
―
|
―
|
205
|
||||||
Total debt securities
|
51
|
403
|
―
|
―
|
454
|
||||||
Total nuclear decommissioning trusts(2)
|
639
|
403
|
―
|
―
|
1,042
|
||||||
Commodity contracts not subject to rate recovery
|
―
|
―
|
―
|
1
|
1
|
||||||
Commodity contracts subject to rate recovery
|
―
|
―
|
91
|
14
|
105
|
||||||
Total
|
$
|
639
|
$
|
403
|
$
|
91
|
$
|
15
|
$
|
1,148
|
|
Liabilities:
|
|||||||||||
Interest rate instruments
|
$
|
―
|
$
|
44
|
$
|
―
|
$
|
―
|
$
|
44
|
|
Commodity contracts not subject to rate recovery
|
1
|
―
|
―
|
(1)
|
―
|
||||||
Commodity contracts subject to rate recovery
|
―
|
67
|
55
|
(53)
|
69
|
||||||
Total
|
$
|
1
|
$
|
111
|
$
|
55
|
$
|
(54)
|
$
|
113
|
|
Fair value at December 31, 2014
|
|||||||||||
Level 1
|
Level 2
|
Level 3
|
Netting(1)
|
Total
|
|||||||
Assets:
|
|||||||||||
Nuclear decommissioning trusts:
|
|||||||||||
Equity securities
|
$
|
655
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
655
|
|
Debt securities:
|
|||||||||||
Debt securities issued by the U.S. Treasury and other
|
|||||||||||
U.S. government corporations and agencies
|
62
|
47
|
―
|
―
|
109
|
||||||
Municipal bonds
|
―
|
129
|
―
|
―
|
129
|
||||||
Other securities
|
―
|
207
|
―
|
―
|
207
|
||||||
Total debt securities
|
62
|
383
|
―
|
―
|
445
|
||||||
Total nuclear decommissioning trusts(2)
|
717
|
383
|
―
|
―
|
1,100
|
||||||
Commodity contracts subject to rate recovery
|
―
|
―
|
107
|
12
|
119
|
||||||
Total
|
$
|
717
|
$
|
383
|
$
|
107
|
$
|
12
|
$
|
1,219
|
|
Liabilities:
|
|||||||||||
Interest rate instruments
|
$
|
―
|
$
|
47
|
$
|
―
|
$
|
―
|
$
|
47
|
|
Commodity contracts not subject to rate recovery
|
1
|
―
|
―
|
(1)
|
―
|
||||||
Commodity contracts subject to rate recovery
|
―
|
51
|
―
|
(36)
|
15
|
||||||
Total
|
$
|
1
|
$
|
98
|
$
|
―
|
$
|
(37)
|
$
|
62
|
|
(1)
|
Includes the effect of the contractual ability to settle contracts under master netting agreements and with cash collateral, as well as cash collateral not offset.
|
||||||||||
(2)
|
Excludes cash balances and cash equivalents.
|
RECURRING FAIR VALUE MEASURES – SOCALGAS
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Fair value at September 30, 2015
|
|||||||||||
Level 1
|
Level 2
|
Level 3
|
Netting(1)
|
Total
|
|||||||
Assets:
|
|||||||||||
Commodity contracts not subject to rate recovery
|
$
|
―
|
$
|
―
|
$
|
―
|
$
|
1
|
$
|
1
|
|
Commodity contracts subject to rate recovery
|
―
|
1
|
―
|
1
|
2
|
||||||
Total
|
$
|
―
|
$
|
1
|
$
|
―
|
$
|
2
|
$
|
3
|
|
Liabilities:
|
|||||||||||
Commodity contracts not subject to rate recovery
|
$
|
2
|
$
|
―
|
$
|
―
|
$
|
(2)
|
$
|
―
|
|
Total
|
$
|
2
|
$
|
―
|
$
|
―
|
$
|
(2)
|
$
|
―
|
|
Fair value at December 31, 2014
|
|||||||||||
Level 1
|
Level 2
|
Level 3
|
Netting(1)
|
Total
|
|||||||
Assets:
|
|||||||||||
Commodity contracts subject to rate recovery
|
$
|
―
|
$
|
1
|
$
|
―
|
$
|
2
|
$
|
3
|
|
Total
|
$
|
―
|
$
|
1
|
$
|
―
|
$
|
2
|
$
|
3
|
|
Liabilities:
|
|||||||||||
Commodity contracts not subject to rate recovery
|
$
|
2
|
$
|
―
|
$
|
―
|
$
|
(2)
|
$
|
―
|
|
Commodity contracts subject to rate recovery
|
―
|
1
|
―
|
―
|
1
|
||||||
Total
|
$
|
2
|
$
|
1
|
$
|
―
|
$
|
(2)
|
$
|
1
|
|
(1)
|
Includes the effect of the contractual ability to settle contracts under master netting agreements and with cash collateral, as well as cash collateral not offset.
|
LEVEL 3 RECONCILIATIONS
|
||||
(Dollars in millions)
|
||||
Three months ended September 30,
|
||||
2015
|
2014
|
|||
Balance as of July 1
|
$
|
42
|
$
|
85
|
Realized and unrealized (losses) gains
|
(49)
|
3
|
||
Allocated transmission instruments
|
―
|
9
|
||
Settlements
|
43
|
(10)
|
||
Balance as of September 30
|
$
|
36
|
$
|
87
|
Change in unrealized gains or losses relating to
|
||||
instruments still held at September 30
|
$
|
(8)
|
$
|
―
|
Nine months ended September 30,
|
||||
2015
|
2014
|
|||
Balance as of January 1
|
$
|
107
|
$
|
99
|
Realized and unrealized (losses) gains
|
(103)
|
9
|
||
Allocated transmission instruments
|
1
|
10
|
||
Settlements
|
31
|
(31)
|
||
Balance as of September 30
|
$
|
36
|
$
|
87
|
Change in unrealized gains or losses relating to
|
||||
instruments still held at September 30
|
$
|
(54)
|
$
|
―
|
FAIR VALUE OF FINANCIAL INSTRUMENTS
|
||||||||||||
(Dollars in millions)
|
||||||||||||
September 30, 2015
|
||||||||||||
Carrying
|
Fair value
|
|||||||||||
amount
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
Sempra Energy Consolidated:
|
||||||||||||
Total long-term debt(1)(2)
|
$
|
13,341
|
$
|
―
|
$
|
13,693
|
$
|
703
|
$
|
14,396
|
||
Preferred stock of subsidiary
|
20
|
―
|
22
|
―
|
22
|
|||||||
SDG&E:
|
||||||||||||
Total long-term debt(2)(3)
|
$
|
4,557
|
$
|
―
|
$
|
4,652
|
$
|
317
|
$
|
4,969
|
||
SoCalGas:
|
||||||||||||
Total long-term debt(4)
|
$
|
2,512
|
$
|
―
|
$
|
2,658
|
$
|
―
|
$
|
2,658
|
||
Preferred stock
|
22
|
―
|
24
|
―
|
24
|
|||||||
December 31, 2014
|
||||||||||||
Carrying
|
Fair value
|
|||||||||||
amount
|
Level 1
|
Level 2
|
Level 3
|
Total
|
||||||||
Sempra Energy Consolidated:
|
||||||||||||
Total long-term debt(1)(2)
|
$
|
12,347
|
$
|
―
|
$
|
12,782
|
$
|
917
|
$
|
13,699
|
||
Preferred stock of subsidiary
|
20
|
―
|
23
|
―
|
23
|
|||||||
SDG&E:
|
||||||||||||
Total long-term debt(2)(3)
|
$
|
4,461
|
$
|
―
|
$
|
4,563
|
$
|
425
|
$
|
4,988
|
||
SoCalGas:
|
||||||||||||
Total long-term debt(4)
|
$
|
1,913
|
$
|
―
|
$
|
2,124
|
$
|
―
|
$
|
2,124
|
||
Preferred stock
|
22
|
―
|
25
|
―
|
25
|
|||||||
(1)
|
Before reductions for unamortized discount (net of premium) of $21 million at both September 30, 2015 and December 31, 2014, and excluding build-to-suit and capital lease obligations of $375 million and $310 million at September 30, 2015 and December 31, 2014, respectively. We discuss our long-term debt in Note 6 above and in Note 5 of the Notes to Consolidated Financial Statements in the Annual Report.
|
|||||||||||
(2)
|
Level 3 instruments include $317 million and $325 million at September 30, 2015 and December 31, 2014, respectively, related to Otay Mesa VIE.
|
|||||||||||
(3)
|
Before reductions for unamortized discount of $10 million and $11 million at September 30, 2015 and December 31, 2014, respectively, and excluding capital lease obligations of $231 million and $234 million at September 30, 2015 and December 31, 2014, respectively.
|
|||||||||||
(4)
|
Before reductions for unamortized discount of $7 million and $8 million at September 30, 2015 and December 31, 2014, respectively, and excluding capital lease obligations of $2 million and $1 million at September 30, 2015 and December 31, 2014, respectively.
|
NUCLEAR DECOMMISSIONING TRUSTS
|
|||||||||
(Dollars in millions)
|
|||||||||
Gross
|
Gross
|
Estimated
|
|||||||
unrealized
|
unrealized
|
fair
|
|||||||
Cost
|
gains
|
losses
|
value
|
||||||
At September 30, 2015:
|
|||||||||
Debt securities:
|
|||||||||
Debt securities issued by the U.S. Treasury and other
|
|||||||||
U.S. government corporations and agencies(1)
|
$
|
90
|
$
|
5
|
$
|
―
|
$
|
95
|
|
Municipal bonds(2)
|
147
|
7
|
―
|
154
|
|||||
Other securities(2)
|
214
|
3
|
(12)
|
205
|
|||||
Total debt securities
|
451
|
15
|
(12)
|
454
|
|||||
Equity securities
|
212
|
382
|
(6)
|
588
|
|||||
Cash and cash equivalents
|
18
|
―
|
―
|
18
|
|||||
Total
|
$
|
681
|
$
|
397
|
$
|
(18)
|
$
|
1,060
|
|
At December 31, 2014:
|
|||||||||
Debt securities:
|
|||||||||
Debt securities issued by the U.S. Treasury and other
|
|||||||||
U.S. government corporations and agencies
|
$
|
103
|
$
|
6
|
$
|
―
|
$
|
109
|
|
Municipal bonds
|
121
|
8
|
―
|
129
|
|||||
Other securities
|
206
|
7
|
(6)
|
207
|
|||||
Total debt securities
|
430
|
21
|
(6)
|
445
|
|||||
Equity securities
|
215
|
444
|
(4)
|
655
|
|||||
Cash and cash equivalents
|
30
|
1
|
―
|
31
|
|||||
Total
|
$
|
675
|
$
|
466
|
$
|
(10)
|
$
|
1,131
|
|
(1)
|
Maturity dates are 2016-2065.
|
||||||||
(2)
|
Maturity dates are 2015-2115.
|
SALES OF SECURITIES
|
|||||||||
(Dollars in millions)
|
|||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
||||||
Proceeds from sales(1)
|
$
|
210
|
$
|
148
|
$
|
431
|
$
|
498
|
|
Gross realized gains
|
18
|
5
|
24
|
9
|
|||||
Gross realized losses
|
(6)
|
(3)
|
(13)
|
(8)
|
|||||
(1)
|
Excludes securities that are held to maturity.
|
§
|
approved the utilities’ model for implementing PSEP;
|
§
|
approved a process, including a reasonableness review, to determine the amount that the utilities will be authorized to recover from ratepayers for the interim costs incurred through the date of the final decision to implement PSEP, which is recorded in the regulatory accounts authorized by the CPUC;
|
§
|
approved balancing account treatment, subject to a reasonableness review, for incremental costs yet to be incurred to implement PSEP; and
|
§
|
established the criteria to determine the amounts that would not be eligible for cost recovery, including:
|
□
|
certain costs incurred or to be incurred searching for pipeline test records,
|
□
|
the cost of pressure testing pipelines installed after July 1, 1961 for which the company has not found sufficient records of testing, and
|
□
|
any undepreciated balances for pipelines installed after 1961 that were replaced due to insufficient documentation of pressure testing.
|
SUNRISE POWERLINK ELECTRIC TRANSMISSION LINE – PROPOSED REVISIONS TO TOTAL PROJECT COST CAP
|
||||||||
(Dollars in millions)
|
||||||||
Total
|
||||||||
Construction costs
|
Undergrounding on
|
Mitigation
|
(2012 dollars, net
|
|||||
and AFUDC
|
Alpine Blvd.
|
and monitoring costs
|
present value basis)
|
|||||
Final status report
|
$
|
1,490.9
|
$
|
11.7
|
$
|
384.8
|
$
|
1,887.4
|
2008 CPUC approval decision
|
1,594.2
|
91.0
|
197.8
|
1,883.0
|
||||
Difference
|
$
|
(103.3)
|
$
|
(79.3)
|
$
|
187.0
|
$
|
4.4
|
FUTURE MINIMUM PAYMENTS – POWER PURCHASE AGREEMENT
|
||||
(Dollars in millions)
|
||||
2015
|
$
|
―
|
||
2016
|
―
|
|||
2017
|
38
|
|||
2018
|
65
|
|||
2019
|
65
|
|||
Thereafter
|
1,460
|
|||
Total minimum lease payments(1)
|
1,628
|
|||
Less: estimated executory costs
|
(392)
|
|||
Less: interest(2)
|
(736)
|
|||
Present value of net minimum lease payments
|
$
|
500
|
||
(1)
|
This amount will be recorded over the life of the lease as Cost of Electric Fuel and Purchased Power on Sempra Energy’s and SDG&E’s Condensed Consolidated Statements of Operations. This expense will receive ratemaking treatment consistent with purchased-power costs, which are recovered in rates.
|
|||
(2)
|
Amount necessary to reduce net minimum lease payments to estimated present value at the inception of the lease.
|
1.
|
SDG&E provides electric service to San Diego and southern Orange counties and natural gas service to San Diego County.
|
2.
|
SoCalGas is a natural gas distribution utility, serving customers throughout most of Southern California and part of central California.
|
3.
|
Sempra South American Utilities develops, owns and operates, or holds interests in, electric transmission, distribution and generation infrastructure in Chile and Peru.
|
4.
|
Sempra Mexico develops, owns and operates, or holds interests in, natural gas transmission pipelines and propane and ethane systems, a natural gas distribution utility, electric generation facilities (including wind), a terminal for the import of LNG, and marketing operations for the purchase of LNG and the purchase and sale of natural gas in Mexico.
|
5.
|
Sempra Renewables develops, owns and operates, or holds interests in, wind and solar energy projects in Arizona, California, Colorado, Hawaii, Indiana, Kansas, Minnesota, Nebraska, Nevada and Pennsylvania to serve wholesale electricity markets in the United States.
|
6.
|
Sempra Natural Gas develops, owns and operates, or holds interests in, natural gas pipelines and storage facilities, natural gas distribution utilities and a terminal for the import and export of LNG and sale of natural gas, all within the United States. Sempra Natural Gas also owned and operated the Mesquite Power plant, a natural gas-fired electric generation asset, the remaining 625-MW block of which was sold in April 2015, as we discuss in Note 3.
|
SEGMENT INFORMATION
|
|||||||||||||||||
(Dollars in millions)
|
|||||||||||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
||||||||||||||||
2015
|
2014
|
2015
|
2014
|
||||||||||||||
REVENUES
|
|||||||||||||||||
SDG&E
|
$
|
1,230
|
50
|
%
|
$
|
1,233
|
44
|
%
|
$
|
3,168
|
42
|
%
|
$
|
3,283
|
40
|
%
|
|
SoCalGas
|
620
|
25
|
855
|
30
|
2,448
|
33
|
2,857
|
35
|
|||||||||
Sempra South American Utilities
|
373
|
15
|
379
|
14
|
1,151
|
15
|
1,147
|
14
|
|||||||||
Sempra Mexico
|
193
|
8
|
234
|
8
|
508
|
7
|
621
|
7
|
|||||||||
Sempra Renewables
|
12
|
―
|
10
|
―
|
30
|
―
|
25
|
―
|
|||||||||
Sempra Natural Gas
|
160
|
6
|
252
|
9
|
512
|
7
|
748
|
9
|
|||||||||
Adjustments and eliminations
|
―
|
―
|
1
|
―
|
(1)
|
―
|
(1)
|
―
|
|||||||||
Intersegment revenues(1)
|
(107)
|
(4)
|
(149)
|
(5)
|
(286)
|
(4)
|
(392)
|
(5)
|
|||||||||
Total
|
$
|
2,481
|
100
|
%
|
$
|
2,815
|
100
|
%
|
$
|
7,530
|
100
|
%
|
$
|
8,288
|
100
|
%
|
|
INTEREST EXPENSE
|
|||||||||||||||||
SDG&E
|
$
|
51
|
$
|
51
|
$
|
155
|
$
|
152
|
|||||||||
SoCalGas
|
23
|
17
|
61
|
50
|
|||||||||||||
Sempra South American Utilities
|
9
|
7
|
22
|
24
|
|||||||||||||
Sempra Mexico
|
7
|
5
|
18
|
13
|
|||||||||||||
Sempra Renewables
|
1
|
2
|
3
|
3
|
|||||||||||||
Sempra Natural Gas
|
13
|
25
|
57
|
90
|
|||||||||||||
All other
|
65
|
63
|
193
|
178
|
|||||||||||||
Intercompany eliminations
|
(26)
|
(26)
|
(93)
|
(92)
|
|||||||||||||
Total
|
$
|
143
|
$
|
144
|
$
|
416
|
$
|
418
|
|||||||||
INTEREST INCOME
|
|||||||||||||||||
SoCalGas
|
$
|
―
|
$
|
―
|
$
|
3
|
$
|
―
|
|||||||||
Sempra South American Utilities
|
5
|
4
|
14
|
10
|
|||||||||||||
Sempra Mexico
|
1
|
1
|
5
|
2
|
|||||||||||||
Sempra Renewables
|
2
|
―
|
3
|
―
|
|||||||||||||
Sempra Natural Gas
|
16
|
24
|
60
|
87
|
|||||||||||||
All other
|
―
|
(1)
|
―
|
―
|
|||||||||||||
Intercompany eliminations
|
(18)
|
(22)
|
(62)
|
(84)
|
|||||||||||||
Total
|
$
|
6
|
$
|
6
|
$
|
23
|
$
|
15
|
|||||||||
DEPRECIATION AND AMORTIZATION
|
|||||||||||||||||
SDG&E
|
$
|
152
|
48
|
%
|
$
|
134
|
46
|
%
|
$
|
446
|
48
|
%
|
$
|
395
|
46
|
%
|
|
SoCalGas
|
116
|
37
|
109
|
37
|
342
|
37
|
321
|
37
|
|||||||||
Sempra South American Utilities
|
12
|
4
|
14
|
5
|
37
|
4
|
41
|
5
|
|||||||||
Sempra Mexico
|
18
|
6
|
16
|
6
|
52
|
6
|
47
|
5
|
|||||||||
Sempra Renewables
|
2
|
―
|
1
|
―
|
5
|
―
|
4
|
―
|
|||||||||
Sempra Natural Gas
|
12
|
4
|
17
|
6
|
36
|
4
|
50
|
6
|
|||||||||
All other
|
3
|
1
|
1
|
―
|
7
|
1
|
8
|
1
|
|||||||||
Total
|
$
|
315
|
100
|
%
|
$
|
292
|
100
|
%
|
$
|
925
|
100
|
%
|
$
|
866
|
100
|
%
|
|
INCOME TAX EXPENSE (BENEFIT)
|
|||||||||||||||||
SDG&E
|
$
|
75
|
$
|
65
|
$
|
217
|
$
|
217
|
|||||||||
SoCalGas
|
(20)
|
44
|
91
|
110
|
|||||||||||||
Sempra South American Utilities
|
16
|
26
|
50
|
59
|
|||||||||||||
Sempra Mexico
|
(6)
|
13
|
7
|
37
|
|||||||||||||
Sempra Renewables
|
(9)
|
(16)
|
(37)
|
(35)
|
|||||||||||||
Sempra Natural Gas
|
―
|
(31)
|
29
|
(22)
|
|||||||||||||
All other
|
(41)
|
(30)
|
(81)
|
(75)
|
|||||||||||||
Total
|
$
|
15
|
$
|
71
|
$
|
276
|
$
|
291
|
SEGMENT INFORMATION (CONTINUED)
|
|||||||||||||||||
(Dollars in millions)
|
|||||||||||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
||||||||||||||||
2015
|
2014
|
2015
|
2014
|
||||||||||||||
EQUITY EARNINGS (LOSSES)
|
|||||||||||||||||
Earnings recorded before tax:
|
|||||||||||||||||
Sempra Renewables
|
$
|
8
|
$
|
7
|
$
|
20
|
$
|
18
|
|||||||||
Sempra Natural Gas
|
25
|
15
|
59
|
44
|
|||||||||||||
Total
|
$
|
33
|
$
|
22
|
$
|
79
|
$
|
62
|
|||||||||
Earnings (losses) recorded net of tax:
|
|||||||||||||||||
Sempra South American Utilities
|
$
|
(3)
|
$
|
(2)
|
$
|
(4)
|
$
|
(4)
|
|||||||||
Sempra Mexico
|
30
|
9
|
68
|
26
|
|||||||||||||
Total
|
$
|
27
|
$
|
7
|
$
|
64
|
$
|
22
|
|||||||||
EARNINGS (LOSSES)
|
|||||||||||||||||
SDG&E
|
$
|
170
|
69
|
%
|
$
|
157
|
45
|
%
|
$
|
443
|
45
|
%
|
$
|
379
|
44
|
%
|
|
SoCalGas(2)
|
(8)
|
(3)
|
98
|
28
|
276
|
28
|
256
|
30
|
|||||||||
Sempra South American Utilities
|
43
|
17
|
32
|
9
|
129
|
13
|
109
|
13
|
|||||||||
Sempra Mexico
|
63
|
25
|
63
|
18
|
160
|
16
|
139
|
16
|
|||||||||
Sempra Renewables
|
15
|
6
|
17
|
5
|
47
|
5
|
63
|
7
|
|||||||||
Sempra Natural Gas
|
1
|
―
|
26
|
8
|
43
|
5
|
39
|
4
|
|||||||||
All other
|
(36)
|
(14)
|
(45)
|
(13)
|
(118)
|
(12)
|
(121)
|
(14)
|
|||||||||
Total
|
$
|
248
|
100
|
%
|
$
|
348
|
100
|
%
|
$
|
980
|
100
|
%
|
$
|
864
|
100
|
%
|
|
Nine months ended September 30,
|
|||||||||||||||||
2015
|
2014
|
||||||||||||||||
EXPENDITURES FOR PROPERTY, PLANT & EQUIPMENT
|
|||||||||||||||||
SDG&E
|
$
|
835
|
38
|
%
|
$
|
790
|
34
|
%
|
|||||||||
SoCalGas
|
946
|
42
|
764
|
33
|
|||||||||||||
Sempra South American Utilities
|
105
|
5
|
126
|
5
|
|||||||||||||
Sempra Mexico
|
185
|
8
|
262
|
11
|
|||||||||||||
Sempra Renewables
|
47
|
2
|
174
|
8
|
|||||||||||||
Sempra Natural Gas
|
61
|
3
|
192
|
8
|
|||||||||||||
All other
|
48
|
2
|
12
|
1
|
|||||||||||||
Total
|
$
|
2,227
|
100
|
%
|
$
|
2,320
|
100
|
%
|
|||||||||
September 30, 2015
|
December 31, 2014
|
||||||||||||||||
ASSETS
|
|||||||||||||||||
SDG&E
|
$
|
16,692
|
41
|
%
|
$
|
16,296
|
41
|
%
|
|||||||||
SoCalGas
|
11,355
|
28
|
10,461
|
26
|
|||||||||||||
Sempra South American Utilities
|
3,265
|
8
|
3,379
|
9
|
|||||||||||||
Sempra Mexico
|
3,713
|
9
|
3,488
|
9
|
|||||||||||||
Sempra Renewables
|
1,351
|
3
|
1,338
|
3
|
|||||||||||||
Sempra Natural Gas
|
5,552
|
14
|
6,436
|
16
|
|||||||||||||
All other
|
1,118
|
3
|
895
|
2
|
|||||||||||||
Intersegment receivables
|
(2,480)
|
(6)
|
(2,561)
|
(6)
|
|||||||||||||
Total
|
$
|
40,566
|
100
|
%
|
$
|
39,732
|
100
|
%
|
|||||||||
INVESTMENTS IN EQUITY METHOD INVESTEES
|
|||||||||||||||||
Sempra South American Utilities
|
$
|
(11)
|
$
|
(8)
|
|||||||||||||
Sempra Mexico
|
491
|
434
|
|||||||||||||||
Sempra Renewables
|
843
|
911
|
|||||||||||||||
Sempra Natural Gas
|
1,435
|
1,347
|
|||||||||||||||
All other
|
87
|
164
|
|||||||||||||||
Total
|
$
|
2,845
|
$
|
2,848
|
|||||||||||||
(1)
|
Revenues for reportable segments include intersegment revenues of $2 million, $19 million, $24 million and $62 million for the three months ended September 30, 2015; $7 million, $55 million, $73 million and $151 million for the nine months ended September 30, 2015; $2 million, $17 million, $23 million and $107 million for the three months ended September 30, 2014; and $7 million, $51 million, $68 million and $266 million for the nine months ended September 30, 2014 for SDG&E, SoCalGas, Sempra Mexico and Sempra Natural Gas, respectively.
|
||||||||||||||||
(2)
|
After preferred dividends.
|
§
|
Sempra Energy and its consolidated entities
|
§
|
SDG&E
|
§
|
SoCalGas
|
CALIFORNIA UTILITIES
|
||
MARKET
|
SERVICE TERRITORY
|
|
SAN DIEGO GAS & ELECTRIC COMPANY (SDG&E)
A regulated public utility; infrastructure supports electric generation, transmission and distribution, and natural gas distribution
|
§ Provides electricity to a population of 3.5 million (1.4 million meters)
§ Provides natural gas to a population of 3.2 million (0.9 million meters)
|
Serves the county of San Diego, California and an adjacent portion of southern Orange County covering 4,100 square miles
|
SOUTHERN CALIFORNIA GAS COMPANY (SOCALGAS)
A regulated public utility; infrastructure supports natural gas distribution, transmission and storage
|
§ Residential, commercial, industrial, utility electric generation and wholesale customers
§ Covers a population of 21.4 million (5.9 million meters)
|
Southern California and portions of central California (excluding San Diego County, the city of Long Beach and the desert area of San Bernardino County) covering 20,000 square miles
|
SEMPRA INTERNATIONAL
|
||
MARKET
|
GEOGRAPHIC REGION
|
|
SEMPRA SOUTH AMERICAN UTILITIES
Develops, owns and operates, or holds interests in electric transmission, distribution and generation infrastructure
|
§ Provides electricity to approximately 2.4 million consumers (approximately 657,000 meters) in Chile and approximately 4.8 million consumers (approximately 1,029,000 meters) in Peru
|
§ Chile
§ Peru
|
SEMPRA MEXICO
Develops, owns and operates, or holds interests in:
§ natural gas transmission pipelines and propane and ethane systems
§ a natural gas distribution utility
§ electric generation facilities, including wind
§ a terminal for the import of liquefied natural gas (LNG)
§ marketing operations for the purchase of LNG and the purchase and sale of natural gas
|
§ Natural gas
§ Wholesale electricity
§ Liquefied natural gas
|
§ Mexico
|
SEMPRA U.S. GAS & POWER
|
||
MARKET
|
GEOGRAPHIC REGION
|
|
SEMPRA RENEWABLES
Develops, owns, operates, or holds interests in renewable energy generation projects
|
§ Wholesale electricity
|
§ U.S.A.
|
SEMPRA NATURAL GAS
Develops, owns and operates, or holds interests in:
§ natural gas pipelines and storage facilities
§ natural gas distribution utilities
§ a terminal in the U.S. for the import and export of LNG and sale of natural gas
§ marketing operations
|
§ Natural gas
§ Liquefied natural gas
§ Wholesale electricity
|
§ U.S.A.
|
§
|
Overall results of our operations and factors affecting those results
|
§
|
Our segment results
|
§
|
Significant changes in revenues, costs and earnings between periods
|
§
|
$14 million higher earnings from CPUC base operations and from electric transmission
|
§
|
$(113) million lower earnings due to SoCalGas recognizing annual core gas authorized revenue during interim periods based on seasonal factors starting in 2015 due to the adoption of a Triennial Cost Allocation Proceeding (TCAP) decision by the California Public Utilities Commission (CPUC). Prior to 2015, SoCalGas recognized such revenue ratably over the year. While this “seasonalization” impacts quarterly and quarterly year-to-date comparisons of operating revenues and earnings for both Sempra Energy and SoCalGas, it will not impact full-year results. We discuss the TCAP decision further in Note 10 of the Notes to Condensed Consolidated Financial Statements herein
|
§
|
$11 million higher earnings from operations, mainly in Peru, due to an increase in volumes and rates, which include foreign currency adjustments
|
§
|
$(14) million gain in 2014 from the sale of a 50-percent equity interest in the first phase of the Energía Sierra Juárez wind-powered electric generation project
|
§
|
$(8) million lower earnings from operations at our Mexicali power plant primarily due to lower capacity revenues
|
§
|
$23 million higher pipeline earnings, primarily due to the start of operations of certain pipelines in the fourth quarter of 2014 and allowance for funds used during construction (AFUDC) related to equity associated with construction of the Los Ramones Norte natural gas pipeline
|
§
|
$(25) million tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments
|
§
|
$(6) million higher investment losses on dedicated assets in support of our executive retirement and deferred compensation plans, net of the decrease in deferred compensation liability associated with the investments
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries, as discussed under “Changes in Revenues, Costs and Earnings – Income Taxes” below
|
§
|
$42 million higher earnings from CPUC base operations and from electric transmission
|
§
|
$13 million reduction to the loss from plant closure in 2015 based on CPUC approval of a compliance filing related to SDG&E’s authorized recovery of its investment in San Onofre Nuclear Generating Station (SONGS) compared to a $9 million increase to the loss in 2014 as a result of reaching a preliminary settlement agreement on the closure, as we discuss in Note 9 of the Notes to Condensed Consolidated Financial Statements herein
|
§
|
$23 million due primarily to a lower effective tax rate, including $14 million favorable resolution of prior years’ income tax items in 2015
|
§
|
$15 million higher earnings from CPUC base operating margin authorized for 2015
|
§
|
$11 million of earnings from a CPUC-approved retroactive increase in authorized General Rate Case (GRC) revenue requirement for years 2012 through 2014 due to increased rate base
|
§
|
$11 million increase in AFUDC related to equity
|
§
|
$(48) million lower earnings due to SoCalGas recognizing annual core gas authorized revenue during interim periods based on seasonal factors starting in 2015 due to the adoption of a TCAP decision
|
§
|
$21 million higher earnings from operations, mainly in Peru, due to an increase in volumes and rates, which include foreign currency adjustments
|
§
|
$54 million higher pipeline earnings, primarily due to the start of operations of certain pipelines in the fourth quarter of 2014 and AFUDC related to equity associated with construction of the Los Ramones Norte natural gas pipeline
|
§
|
$(16) million lower earnings from operations at our Mexicali power plant primarily due to lower capacity revenues and lower volumes
|
§
|
$(14) million gain in 2014 from the sale of a 50-percent equity interest in the first phase of the Energía Sierra Juárez project
|
§
|
$(16) million gain in 2014 from the sale of a 50-percent equity interest in Copper Mountain Solar 3
|
§
|
$36 million gain on the April 2015 sale of the remaining 625-megawatt (MW) block of the Mesquite Power plant
|
§
|
$(25) million tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries
|
§
|
$(5) million investment losses in 2015 compared to $(9) million investment gains in 2014 on dedicated assets in support of our executive retirement and deferred compensation plans, net of the decrease in deferred compensation liability associated with the investments
|
SEMPRA ENERGY EARNINGS (LOSSES) BY SEGMENT
|
|||||||||||||||||
(Dollars in millions)
|
|||||||||||||||||
Three months ended September 30,
|
Nine months ended September 30,
|
||||||||||||||||
2015
|
2014
|
2015
|
2014
|
||||||||||||||
California Utilities:
|
|||||||||||||||||
SDG&E
|
$
|
170
|
69
|
%
|
$
|
157
|
45
|
%
|
$
|
443
|
45
|
%
|
$
|
379
|
44
|
%
|
|
SoCalGas(1)
|
(8)
|
(3)
|
98
|
28
|
276
|
28
|
256
|
30
|
|||||||||
Sempra International:
|
|||||||||||||||||
Sempra South American Utilities
|
43
|
17
|
32
|
9
|
129
|
13
|
109
|
13
|
|||||||||
Sempra Mexico
|
63
|
25
|
63
|
18
|
160
|
16
|
139
|
16
|
|||||||||
Sempra U.S. Gas & Power:
|
|||||||||||||||||
Sempra Renewables
|
15
|
6
|
17
|
5
|
47
|
5
|
63
|
7
|
|||||||||
Sempra Natural Gas
|
1
|
―
|
26
|
8
|
43
|
5
|
39
|
4
|
|||||||||
Parent and other(2)
|
(36)
|
(14)
|
(45)
|
(13)
|
(118)
|
(12)
|
(121)
|
(14)
|
|||||||||
Earnings
|
$
|
248
|
100
|
%
|
$
|
348
|
100
|
%
|
$
|
980
|
100
|
%
|
$
|
864
|
100
|
%
|
|
(1)
|
After preferred dividends.
|
||||||||||||||||
(2)
|
Includes after-tax interest expense ($38 million and $37 million for the three months ended September 30, 2015 and 2014, respectively, and $115 million and $106 million for the nine months ended September 30, 2015 and 2014, respectively), intercompany eliminations recorded in consolidation and certain corporate costs.
|
EARNINGS (LOSSES) BY SEGMENT – CALIFORNIA UTILITIES
|
(Dollars in millions)
|
§
|
$170 million in the three months ended September 30, 2015
|
§
|
$157 million in the three months ended September 30, 2014
|
§
|
$443 million for the first nine months of 2015
|
§
|
$379 million for the first nine months of 2014
|
§
|
$8 million higher CPUC base operating margin authorized for 2015, and lower non-refundable operating costs; and
|
§
|
$6 million higher earnings from electric transmission operations primarily due to higher rate base.
|
§
|
$23 million higher CPUC base operating margin authorized for 2015, and lower non-refundable operating costs;
|
§
|
$13 million reduction to the loss from plant closure in 2015 based on the CPUC approval of a compliance filing related to SDG&E’s authorized recovery of its investment in SONGS compared to a $9 million increase to the loss in 2014 as a result of reaching a preliminary settlement agreement on the closure;
|
§
|
$19 million higher earnings from electric transmission operations primarily due to higher rate base; and
|
§
|
$9 million higher favorable resolution of prior years’ income tax items; offset by
|
§
|
$7 million higher earnings in 2014 associated with SDG&E’s annual Federal Energy Regulatory Commission (FERC) formulaic rate adjustment; and
|
§
|
$3 million favorable settlement in 2014 associated with a long-term service agreement.
|
§
|
$(8) million in the three months ended September 30, 2015 (both before and after preferred dividends)
|
§
|
$98 million in the three months ended September 30, 2014 (both before and after preferred dividends)
|
§
|
$276 million for the first nine months of 2015 ($277 million before preferred dividends)
|
§
|
$256 million for the first nine months of 2014 ($257 million before preferred dividends)
|
§
|
$113 million lower earnings resulting from the seasonalization of interim period recognition of annual core gas authorized revenue starting in 2015 (after-tax impact is based on SoCalGas’ effective tax rate); offset by
|
§
|
$11 million favorable resolution of prior years’ income tax items in 2015.
|
§
|
$23 million due primarily to a lower effective tax rate, as we discuss under “Income Taxes” below, including $14 million favorable resolution of prior years’ income tax items in 2015;
|
§
|
$15 million higher CPUC base operating margin authorized for 2015 and lower non-refundable operating costs;
|
§
|
$11 million of earnings from a CPUC-approved retroactive increase in authorized GRC revenue requirement for years 2012 through 2014 due to increased rate base;
|
§
|
$11 million increase in AFUDC related to equity;
|
§
|
$6 million from the favorable resolution of a legal settlement in 2015, including $2 million of related interest income;
|
§
|
$5 million higher gas cost incentive mechanism (GCIM) awards; and
|
§
|
$5 million write-off in 2014 of certain costs incurred that were disallowed for recovery in the final PSEP decision; offset by
|
§
|
$48 million lower earnings resulting from the seasonalization of interim period recognition of annual core gas authorized revenue starting in 2015 (after-tax impact is based on SoCalGas’ effective tax rate); and
|
§
|
$7 million higher interest expense.
|
EARNINGS BY SEGMENT – SEMPRA INTERNATIONAL
|
(Dollars in millions)
|
§
|
$43 million in the three months ended September 30, 2015
|
§
|
$32 million in the three months ended September 30, 2014
|
§
|
$129 million for the first nine months of 2015
|
§
|
$109 million for the first nine months of 2014
|
§
|
$11 million higher earnings from operations, mainly in Peru, due to an increase in volumes and rates, which include foreign currency adjustments; and
|
§
|
$9 million lower income tax expense, including $6 million recorded in 2014 related to Chilean tax reform, as we discuss in “Results of Operations – Changes in Revenues, Costs and Earnings – Income Taxes” in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Annual Report; offset by
|
§
|
$6 million lower earnings from foreign currency effects.
|
§
|
$21 million higher earnings from operations, mainly in Peru, due to an increase in volumes and rates, which include foreign currency adjustments;
|
§
|
$11 million lower income tax expense, including $6 million recorded in 2014 related to Chilean tax reform; and
|
§
|
$4 million lower interest expense, mainly in Chile, related to inflationary effect on local bonds; offset by
|
§
|
$15 million lower earnings from foreign currency effects.
|
§
|
$63 million in the three months ended September 30, 2015
|
§
|
$63 million in the three months ended September 30, 2014
|
§
|
$160 million for the first nine months of 2015
|
§
|
$139 million for the first nine months of 2014
|
§
|
$23 million higher pipeline earnings, primarily due to the start of operations of certain pipelines in the fourth quarter of 2014 and AFUDC related to equity associated with construction of the Los Ramones Norte natural gas pipeline, which is being developed through a joint venture with Petróleos Mexicanos (or PEMEX, the Mexican state-owned oil company) and affiliates of PEMEX; and
|
§
|
$12 million favorable income tax variance primarily due to the effects from foreign currency and inflation; offset by
|
§
|
$14 million gain in 2014 from the sale of a 50-percent equity interest in the first phase of the Energía Sierra Juárez project;
|
§
|
$8 million lower earnings from operations at our Mexicali power plant primarily due to lower capacity revenues;
|
§
|
$7 million lower AFUDC related to equity associated with construction of the natural gas pipeline in Sonora; and
|
§
|
$5 million unfavorable translation effect primarily on Peso-denominated receivables.
|
§
|
$54 million higher pipeline earnings, primarily due to the start of operations of certain pipelines in the fourth quarter of 2014 and AFUDC related to equity associated with construction of the Los Ramones Norte natural gas pipeline;
|
§
|
$21 million favorable income tax variance primarily due to the effects from foreign currency and inflation; and
|
§
|
$7 million higher earnings from the Energía Sierra Juárez joint venture due to the start of operations during the second quarter of 2015; offset by
|
§
|
$16 million lower earnings from operations at our Mexicali power plant primarily due to lower capacity revenues and lower volumes;
|
§
|
$14 million gain in 2014 from the sale of a 50-percent equity interest in the first phase of the Energía Sierra Juárez project;
|
§
|
$10 million unfavorable translation effect primarily on Peso-denominated receivables;
|
§
|
$7 million increase in earnings attributable to noncontrolling interests at IEnova;
|
§
|
$6 million lower AFUDC related to equity associated with construction of the natural gas pipeline in Sonora; and
|
§
|
$5 million lower earnings mainly from LNG operations.
|
EARNINGS BY SEGMENT – SEMPRA U.S. GAS & POWER
|
(Dollars in millions)
|
§
|
$15 million in the three months ended September 30, 2015
|
§
|
$17 million in the three months ended September 30, 2014
|
§
|
$47 million for the first nine months of 2015
|
§
|
$63 million for the first nine months of 2014
|
§
|
$1 million in the three months ended September 30, 2015
|
§
|
$26 million in the three months ended September 30, 2014
|
§
|
$43 million for the first nine months of 2015
|
§
|
$39 million for the first nine months of 2014
|
§
|
$25 million tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments; and
|
§
|
$6 million lower results from LNG marketing operations, including the effect of lower gas prices; offset by
|
§
|
$7 million higher earnings from mark-to-market gains on commodity contracts.
|
§
|
$36 million gain on the April 2015 sale of the remaining 625-MW block of the Mesquite Power plant, net of related expenses;
|
§
|
$16 million improved results from midstream activities; and
|
§
|
$8 million higher earnings from mark-to-market gains on commodity contracts and lower costs from the Mesquite Power plant due to the sale of the remaining block in April 2015; offset by
|
§
|
$26 million lower results from LNG marketing operations, including the effect of lower gas prices;
|
§
|
$25 million tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments; and
|
§
|
$7 million in development expense associated with the potential expansion of our LNG business.
|
§
|
$36 million in the three months ended September 30, 2015
|
§
|
$45 million in the three months ended September 30, 2014
|
§
|
$118 million for the first nine months of 2015
|
§
|
$121 million for the first nine months of 2014
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries; offset by
|
§
|
$6 million higher investment losses on dedicated assets in support of our executive retirement and deferred compensation plans, net of the decrease in deferred compensation liability associated with the investments.
|
§
|
$16 million higher income tax benefits, including
|
□
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries,
|
□
|
$5 million higher income tax benefits from a decrease in state valuation allowances, and
|
□
|
$5 million in net state income tax refunds related to our former commodities-marketing businesses, offset by
|
□
|
$6 million of income tax expense associated with the resolution of prior years’ income tax items in 2015; offset by
|
§
|
$5 million investment losses in 2015 compared to $9 million investment gains in 2014 on dedicated assets in support of our executive retirement and deferred compensation plans, net of the decrease in deferred compensation liability associated with the investments.
|
§
|
SDG&E
|
§
|
SoCalGas
|
§
|
Sempra Mexico’s Ecogas México, S. de R.L. de C.V. (Ecogas)
|
§
|
Sempra Natural Gas’ Mobile Gas Service Corporation (Mobile Gas) and Willmut Gas Company (Willmut Gas)
|
§
|
SDG&E
|
§
|
Sempra South American Utilities’ Chilquinta Energía S.A. (Chilquinta Energía) and Luz del Sur S.A.A. (Luz del Sur)
|
UTILITIES REVENUES AND COST OF SALES
|
|||||||||
(Dollars in millions)
|
|||||||||
Three months ended
September 30,
|
Nine months ended
September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
||||||
Electric revenues:
|
|||||||||
SDG&E
|
$
|
1,140
|
$
|
1,133
|
$
|
2,819
|
$
|
2,892
|
|
Sempra South American Utilities
|
351
|
354
|
1,077
|
1,072
|
|||||
Eliminations and adjustments
|
(2)
|
(2)
|
(6)
|
(7)
|
|||||
Total
|
1,489
|
1,485
|
3,890
|
3,957
|
|||||
Natural gas revenues:
|
|||||||||
SoCalGas
|
620
|
855
|
2,448
|
2,857
|
|||||
SDG&E
|
90
|
100
|
349
|
391
|
|||||
Sempra Mexico
|
18
|
23
|
62
|
82
|
|||||
Sempra Natural Gas
|
16
|
17
|
76
|
84
|
|||||
Eliminations and adjustments
|
(20)
|
(17)
|
(57)
|
(53)
|
|||||
Total
|
724
|
978
|
2,878
|
3,361
|
|||||
Total utilities revenues
|
$
|
2,213
|
$
|
2,463
|
$
|
6,768
|
$
|
7,318
|
|
Cost of electric fuel and purchased power:
|
|||||||||
SDG&E
|
$
|
427
|
$
|
441
|
$
|
906
|
$
|
1,036
|
|
Sempra South American Utilities
|
239
|
239
|
739
|
725
|
|||||
Total
|
$
|
666
|
$
|
680
|
$
|
1,645
|
$
|
1,761
|
|
Cost of natural gas:
|
|||||||||
SoCalGas
|
$
|
163
|
$
|
237
|
$
|
626
|
$
|
1,066
|
|
SDG&E
|
27
|
39
|
112
|
165
|
|||||
Sempra Mexico
|
12
|
16
|
38
|
56
|
|||||
Sempra Natural Gas
|
4
|
6
|
24
|
33
|
|||||
Eliminations and adjustments
|
(5)
|
(5)
|
(14)
|
(12)
|
|||||
Total
|
$
|
201
|
$
|
293
|
$
|
786
|
$
|
1,308
|
§
|
$7 million increase at SDG&E, which included
|
□
|
$23 million higher revenues from CPUC-authorized 2015 attrition and, starting in 2015, authorized revenues for the recovery of the SONGS regulatory assets pursuant to an amended settlement agreement approved by the CPUC in 2014. The GRC decision for years 2012 through 2015 established a revenue attrition mechanism for the escalation of adopted revenue requirements based on fixed annual factors, and
|
□
|
$18 million higher authorized revenues from electric transmission, offset by
|
□
|
$19 million lower recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses, and
|
□
|
$14 million lower cost of electric fuel and purchased power, which we discuss below; offset by
|
§
|
$3 million decrease at Sempra South American Utilities, primarily due to foreign currency exchange rate effects, offset by higher rates at both Luz del Sur and Chilquinta Energía.
|
§
|
$73 million decrease at SDG&E, which included
|
□
|
$130 million lower cost of electric fuel and purchased power, which we discuss below, and
|
□
|
$34 million lower recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses, offset by
|
□
|
$66 million higher revenues from CPUC-authorized 2015 attrition and, starting in 2015, authorized revenues for the recovery of the SONGS regulatory assets pursuant to an amended settlement agreement approved by the CPUC in 2014, and
|
□
|
$35 million higher authorized revenues from electric transmission; offset by
|
§
|
$5 million increase at Sempra South American Utilities, primarily due to higher rates at both Luz del Sur and Chilquinta Energía and higher volumes at Luz del Sur, offset by foreign currency exchange rate effects. Volumes decreased at Chilquinta Energía due to a transfer of customers to our energy-services companies in Chile.
|
§
|
$130 million decrease at SDG&E, which we discuss below; offset by
|
§
|
$14 million increase at Sempra South American Utilities driven primarily by higher rates at both Luz del Sur and Chilquinta Energía and higher volumes at Luz del Sur, offset by foreign currency exchange rate effects. Volumes decreased at Chilquinta Energía due to a transfer of customers to our energy-services companies in Chile.
|
§
|
$158 million decrease resulting from the seasonalization of interim period recognition of annual core gas authorized revenue at SoCalGas starting in 2015;
|
§
|
decreases in cost of natural gas sold at SoCalGas and SDG&E, as we discuss below; and
|
§
|
$13 million lower recovery of costs at SoCalGas associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses; offset by
|
§
|
$13 million higher revenues from CPUC-authorized 2015 attrition at SoCalGas.
|
§
|
decreases in cost of natural gas sold at SoCalGas and SDG&E, as we discuss below; and
|
§
|
$67 million decrease resulting from the seasonalization of interim period recognition of annual core gas authorized revenue at SoCalGas starting in 2015; offset by
|
§
|
$50 million higher revenues from CPUC-authorized 2015 attrition at the California Utilities;
|
§
|
$19 million increase at SoCalGas from a CPUC-approved retroactive increase in authorized GRC revenue requirement for years 2012 through 2014 due to increased rate base;
|
§
|
$18 million higher recovery of costs at SoCalGas associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses; and
|
§
|
$8 million higher GCIM awards at SoCalGas.
|
SDG&E
|
|||||||
ELECTRIC DISTRIBUTION AND TRANSMISSION
|
|||||||
(Volumes in millions of kilowatt-hours, dollars in millions)
|
|||||||
Nine months ended
September 30, 2015
|
Nine months ended
September 30, 2014
|
||||||
Customer class
|
Volumes
|
Revenue
|
Volumes
|
Revenue
|
|||
Residential
|
5,257
|
$
|
1,096
|
5,501
|
$
|
1,042
|
|
Commercial
|
5,112
|
1,116
|
5,245
|
1,048
|
|||
Industrial
|
1,519
|
268
|
1,556
|
251
|
|||
Direct access(1)
|
2,683
|
170
|
2,761
|
150
|
|||
Street and highway lighting
|
62
|
11
|
66
|
11
|
|||
14,633
|
2,661
|
15,129
|
2,502
|
||||
CAISO shared transmission revenue - net(2)
|
214
|
137
|
|||||
Other revenues
|
166
|
144
|
|||||
Balancing accounts
|
(222)
|
109
|
|||||
Total(3)
|
$
|
2,819
|
$
|
2,892
|
|||
(1)
|
The Direct Access (DA) program, which offered all customers the option to purchase their electric commodity services from a third-party Energy Service Provider instead of continuing to receive these services from SDG&E, was implemented in 1998 and suspended in 2001. In 2009, Senate Bill 695 required the CPUC to develop a process and rules for a limited re-opening of DA to be phased in over a period of time. In 2010, the CPUC adopted the process and rules for the limited re-opening of DA for non-residential customers under a 4-year phase-in schedule.
|
||||||
(2)
|
California Independent System Operator (CAISO).
|
||||||
(3)
|
Includes sales to affiliates of $6 million in each of 2015 and 2014.
|
§
|
$23 million higher revenues from CPUC-authorized 2015 attrition and, starting in 2015, authorized revenues for the recovery of the SONGS regulatory assets pursuant to an amended settlement agreement approved by the CPUC in 2014; and
|
§
|
$18 million higher authorized revenues from electric transmission; offset by
|
§
|
$19 million lower recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses; and
|
§
|
$14 million decrease in cost of electric fuel and purchased power, including:
|
□
|
a decrease in the cost of purchased power due to declining natural gas prices, and
|
□
|
lower demand due to regional climatic impacts and a decrease in consumption due to energy efficiency initiatives, including an increase in rooftop solar installations, in the third quarter of 2015 compared to the same period in 2014, offset by
|
□
|
an increase from the incremental purchase of renewable energy at higher prices.
|
§
|
$130 million decrease in cost of electric fuel and purchased power, including:
|
□
|
a decrease in the cost of purchased power due to declining natural gas prices, and
|
□
|
lower demand due to regional climatic impacts and a decrease in consumption due to energy efficiency initiatives, including an increase in rooftop solar installations, in 2015 compared to the same period in 2014, offset by
|
□
|
an increase from the incremental purchase of renewable energy at higher prices; and
|
§
|
$34 million lower recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses; offset by
|
§
|
$66 million higher revenues from CPUC-authorized 2015 attrition and, starting in 2015, authorized revenues for the recovery of the SONGS regulatory assets pursuant to an amended settlement agreement approved by the CPUC in 2014; and
|
§
|
$35 million higher authorized revenues from electric transmission.
|
SDG&E
|
||||||||||
NATURAL GAS SALES AND TRANSPORTATION
|
||||||||||
(Volumes in billion cubic feet, dollars in millions)
|
||||||||||
Natural gas sales
|
Transportation
|
Total
|
||||||||
Customer class
|
Volumes
|
Revenue
|
Volumes
|
Revenue
|
Volumes
|
Revenue
|
||||
Nine months ended September 30, 2015:
|
||||||||||
Residential
|
18
|
$
|
222
|
―
|
$
|
2
|
18
|
$
|
224
|
|
Commercial and industrial
|
10
|
74
|
6
|
10
|
16
|
84
|
||||
Electric generation plants
|
―
|
―
|
20
|
―
|
20
|
―
|
||||
28
|
$
|
296
|
26
|
$
|
12
|
54
|
308
|
|||
Other revenues
|
31
|
|||||||||
Balancing accounts
|
10
|
|||||||||
Total(1)
|
$
|
349
|
||||||||
Nine months ended September 30, 2014:
|
||||||||||
Residential
|
21
|
$
|
241
|
―
|
$
|
―
|
21
|
$
|
241
|
|
Commercial and industrial
|
11
|
83
|
6
|
8
|
17
|
91
|
||||
Electric generation plants
|
―
|
―
|
19
|
1
|
19
|
1
|
||||
32
|
$
|
324
|
25
|
$
|
9
|
57
|
333
|
|||
Other revenues
|
31
|
|||||||||
Balancing accounts
|
27
|
|||||||||
Total(1)
|
$
|
391
|
||||||||
(1)
|
Includes sales to affiliates of $2 million in each of 2015 and 2014.
|
§
|
lower cost of natural gas sold, and lower demand, as we discuss below; offset by
|
§
|
$6 million increase in revenues from CPUC-authorized 2015 attrition; and
|
§
|
$3 million higher recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses.
|
SOCALGAS
|
||||||||||
NATURAL GAS SALES AND TRANSPORTATION
|
||||||||||
(Volumes in billion cubic feet, dollars in millions)
|
||||||||||
Natural gas sales
|
Transportation
|
Total
|
||||||||
Customer class
|
Volumes
|
Revenue
|
Volumes
|
Revenue
|
Volumes
|
Revenue
|
||||
Nine months ended September 30, 2015:
|
||||||||||
Residential
|
132
|
$
|
1,373
|
2
|
$
|
12
|
134
|
$
|
1,385
|
|
Commercial and industrial
|
67
|
451
|
213
|
198
|
280
|
649
|
||||
Electric generation plants
|
―
|
―
|
147
|
31
|
147
|
31
|
||||
Wholesale
|
―
|
―
|
112
|
20
|
112
|
20
|
||||
199
|
$
|
1,824
|
474
|
$
|
261
|
673
|
2,085
|
|||
Other revenues
|
131
|
|||||||||
Balancing accounts
|
232
|
|||||||||
Total(1)
|
$
|
2,448
|
||||||||
Nine months ended September 30, 2014:
|
||||||||||
Residential
|
139
|
$
|
1,564
|
2
|
$
|
10
|
141
|
$
|
1,574
|
|
Commercial and industrial
|
68
|
563
|
220
|
197
|
288
|
760
|
||||
Electric generation plants
|
―
|
―
|
156
|
32
|
156
|
32
|
||||
Wholesale
|
―
|
―
|
109
|
18
|
109
|
18
|
||||
207
|
$
|
2,127
|
487
|
$
|
257
|
694
|
2,384
|
|||
Other revenues
|
74
|
|||||||||
Balancing accounts
|
399
|
|||||||||
Total(1)
|
$
|
2,857
|
||||||||
(1)
|
Includes sales to affiliates of $55 million in 2015 and $51 million in 2014.
|
§
|
$158 million decrease resulting from the seasonalization of interim period recognition of annual core gas authorized revenue starting in 2015;
|
§
|
the decrease in the cost of natural gas sold, as we discuss below;
|
§
|
$13 million lower recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses; and
|
§
|
$6 million GCIM award approved in 2014; offset by
|
§
|
$13 million increase in revenues from CPUC-authorized 2015 attrition.
|
§
|
the decrease in the cost of natural gas sold, as we discuss below; and
|
§
|
$67 million decrease resulting from the seasonalization of interim period recognition of annual core gas authorized revenue starting in 2015; offset by
|
§
|
$44 million higher revenues from CPUC-authorized 2015 attrition;
|
§
|
$19 million increase from a CPUC-approved retroactive increase in authorized GRC revenue requirement for years 2012 through 2014 due to increased rate base;
|
§
|
$18 million higher recovery of costs associated with CPUC-authorized refundable programs, which revenues are fully offset in operation and maintenance expenses;
|
§
|
$9 million write-off in 2014 of certain costs incurred that were disallowed for recovery in the final PSEP decision; and
|
§
|
$8 million higher GCIM awards.
|
OTHER UTILITIES
|
|||||||
NATURAL GAS AND ELECTRIC REVENUES
|
|||||||
(Dollars in millions)
|
|||||||
Nine months ended
September 30, 2015
|
Nine months ended
September 30, 2014
|
||||||
Volumes
|
Revenue
|
Volumes
|
Revenue
|
||||
Natural Gas Sales (billion cubic feet):
|
|||||||
Sempra Mexico – Ecogas
|
19
|
$
|
62
|
18
|
$
|
82
|
|
Sempra Natural Gas:
|
|||||||
Mobile Gas (including transportation)
|
35
|
62
|
29
|
66
|
|||
Willmut Gas
|
2
|
14
|
2
|
18
|
|||
Total
|
56
|
$
|
138
|
49
|
$
|
166
|
|
Electric Sales (million kilowatt hours):
|
|||||||
Sempra South American Utilities:
|
|||||||
Luz del Sur
|
5,695
|
$
|
663
|
5,458
|
$
|
642
|
|
Chilquinta Energía
|
2,172
|
384
|
2,192
|
394
|
|||
7,867
|
1,047
|
7,650
|
1,036
|
||||
Other service revenues
|
30
|
36
|
|||||
Total
|
$
|
1,077
|
$
|
1,072
|
ENERGY-RELATED BUSINESSES: REVENUES AND COST OF SALES
|
|||||||||
(Dollars in millions)
|
|||||||||
Three months ended
September 30,
|
Nine months ended
September 30,
|
||||||||
2015
|
2014
|
2015
|
2014
|
||||||
Energy-related businesses revenues:
|
|||||||||
Sempra South American Utilities
|
$
|
22
|
$
|
25
|
$
|
74
|
$
|
75
|
|
Sempra Mexico
|
175
|
211
|
446
|
539
|
|||||
Sempra Renewables
|
12
|
10
|
30
|
25
|
|||||
Sempra Natural Gas
|
144
|
235
|
436
|
664
|
|||||
Intersegment revenues, adjustments
|
|||||||||
and eliminations(1)
|
(85)
|
(129)
|
(224)
|
(333)
|
|||||
Total energy-related businesses revenues
|
$
|
268
|
$
|
352
|
$
|
762
|
$
|
970
|
|
Cost of natural gas, electric fuel
|
|||||||||
and purchased power(2):
|
|||||||||
Sempra South American Utilities
|
$
|
3
|
$
|
3
|
$
|
19
|
$
|
10
|
|
Sempra Mexico
|
71
|
108
|
167
|
272
|
|||||
Sempra Natural Gas
|
101
|
179
|
293
|
473
|
|||||
Adjustments and eliminations(1)
|
(84)
|
(127)
|
(217)
|
(328)
|
|||||
Total cost of natural gas, electric fuel
|
|||||||||
and purchased power
|
$
|
91
|
$
|
163
|
$
|
262
|
$
|
427
|
|
Other cost of sales(2):
|
|||||||||
Sempra South American Utilities
|
$
|
17
|
$
|
17
|
$
|
46
|
$
|
50
|
|
Sempra Mexico
|
3
|
4
|
12
|
9
|
|||||
Sempra Natural Gas
|
15
|
23
|
58
|
69
|
|||||
Adjustments and eliminations(1)
|
(1)
|
(2)
|
(5)
|
(6)
|
|||||
Total other cost of sales
|
$
|
34
|
$
|
42
|
$
|
111
|
$
|
122
|
|
(1)
|
Includes eliminations of intercompany activity.
|
||||||||
(2)
|
Excludes depreciation and amortization, which are shown separately on the Condensed Consolidated Statements of Operations.
|
§
|
$91 million decrease at Sempra Natural Gas mainly from lower natural gas prices, as well as from the deconsolidation of Cameron LNG, LLC as of October 1, 2014; and
|
§
|
$36 million lower revenues at Sempra Mexico primarily due to lower natural gas prices and volumes in its gas business and lower power prices and capacity revenues in its power business, offset by higher transportation revenues from a section of the Sonora natural gas pipeline that commenced operations in the fourth quarter of 2014; offset by
|
§
|
$44 million primarily from lower intercompany eliminations associated with sales between Sempra Natural Gas and Sempra Mexico.
|
§
|
$78 million decrease at Sempra Natural Gas primarily due to lower natural gas costs and lower electric fuel costs due to the sale of the remaining block of Mesquite Power in April 2015; and
|
§
|
$37 million decrease at Sempra Mexico primarily due to lower natural gas costs and volumes; offset by
|
§
|
$43 million from lower intercompany eliminations of costs associated with sales between Sempra Natural Gas and Sempra Mexico.
|
§
|
$228 million decrease at Sempra Natural Gas mainly from lower natural gas prices, as well as from the deconsolidation of Cameron LNG, LLC as of October 1, 2014; and
|
§
|
$93 million lower revenues at Sempra Mexico primarily due to lower natural gas prices and volumes in its gas business and lower power prices and volumes and lower capacity revenues in its power business, offset by higher transportation revenues from a section of the Sonora natural gas pipeline that commenced operations in the fourth quarter of 2014; offset by
|
§
|
$109 million from lower intercompany eliminations associated with sales between Sempra Natural Gas and Sempra Mexico.
|
§
|
$180 million decrease at Sempra Natural Gas primarily due to lower natural gas costs and lower electric fuel costs due to the sale of the remaining block of Mesquite Power in April 2015; and
|
§
|
$105 million decrease at Sempra Mexico primarily due to lower natural gas costs and volumes; offset by
|
§
|
$111 million from lower intercompany eliminations of costs associated with sales between Sempra Natural Gas and Sempra Mexico.
|
§
|
$21 million lower expenses associated with CPUC-authorized refundable programs, for which all costs incurred are fully recovered in revenue (refundable program expenses); and
|
§
|
$4 million lower litigation expense.
|
§
|
$31 million lower expenses associated with CPUC-authorized refundable programs, for which all costs incurred are fully recovered in revenue (refundable program expenses);
|
§
|
$26 million lower non-refundable operating costs, including $13 million lower major maintenance costs at its electric generating facilities, as well as labor, contract services and administrative and support costs; and
|
§
|
$4 million lower litigation expense.
|
§
|
$13 million lower expenses associated with CPUC-authorized refundable programs for which all costs incurred are fully recovered in revenue (refundable program expenses); offset by
|
§
|
$12 million higher non-refundable operating costs, including labor, contract services and administrative and support costs.
|
§
|
$18 million higher expenses associated with CPUC-authorized refundable programs for which all costs incurred are fully recovered in revenue (refundable program expenses); offset by
|
§
|
$2 million lower litigation expense, including $6 million from the favorable resolution of a legal settlement in 2015, offset by $4 million higher other litigation expense.
|
§
|
$19 million ($14 million after-tax) for the first phase of the Energía Sierra Juárez project (in the third quarter)
|
§
|
$27 million ($16 million after-tax) for Copper Mountain Solar 3 (in the first quarter)
|
§
|
$9 million higher equity earnings from Rockies Express Pipeline, LLC; and
|
§
|
$6 million equity earnings in 2015 from Cameron LNG Holdings, which include amortization of the completion guarantee related to the financing agreements described in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report.
|
§
|
$9 million higher investment losses in 2015 on dedicated assets in support of our executive retirement and deferred compensation plans;
|
§
|
$4 million of electrical infrastructure income in Peru in 2014; and
|
§
|
$2 million net decrease in equity-related AFUDC.
|
§
|
$5 million investment losses in 2015 compared to $20 million gains in 2014 on dedicated assets in support of our executive retirement and deferred compensation plans;
|
§
|
$7 million losses on interest rate and foreign exchange instruments in 2015 compared to $3 million gains in 2014; and
|
§
|
$5 million higher foreign currency losses in 2015; offset by
|
§
|
$7 million net increase in equity-related AFUDC, including $11 million at SoCalGas; and
|
§
|
$7 million higher income from the sale of other investments.
|
§
|
$33 million decrease at Sempra Natural Gas primarily related to capitalized interest for the Cameron liquefaction project; offset by
|
§
|
$15 million increase in long-term debt interest at SoCalGas primarily due to debt issuances in 2014 and 2015; and
|
§
|
$15 million increase in long-term debt interest at Parent and Other primarily due to debt issuances in 2014 and 2015, net of maturities.
|
INCOME TAX EXPENSE (BENEFIT) AND EFFECTIVE INCOME TAX RATES
|
|||||||||||
(Dollars in millions)
|
|||||||||||
Income tax
|
Effective
|
Effective
|
|||||||||
expense
|
income
|
Income tax
|
income
|
||||||||
(benefit)
|
tax rate
|
expense
|
tax rate
|
||||||||
Three months ended September 30,
|
|||||||||||
2015
|
2014
|
||||||||||
Sempra Energy Consolidated
|
$
|
15
|
6
|
%
|
$
|
71
|
16
|
%
|
|||
SDG&E
|
75
|
29
|
65
|
28
|
|||||||
SoCalGas
|
(20)
|
71
|
44
|
31
|
|||||||
Nine months ended September 30,
|
|||||||||||
2015
|
2014
|
||||||||||
Sempra Energy Consolidated
|
$
|
276
|
22
|
%
|
$
|
291
|
24
|
%
|
|||
SDG&E
|
217
|
32
|
217
|
35
|
|||||||
SoCalGas
|
91
|
25
|
110
|
30
|
§
|
$12 million higher favorable resolution of prior years’ income tax items in 2015;
|
§
|
$9 million higher income tax benefit in 2015 from foreign currency translation and inflation adjustments; and
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries, as discussed below; offset by
|
§
|
$25 million income tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments.
|
§
|
$17 million charge in 2014 to reduce certain tax regulatory assets attributed to SDG&E’s investment in SONGS that we discuss in Note 9 of the Notes to Condensed Consolidated Financial Statements herein;
|
§
|
$19 million higher favorable resolution of prior years’ income tax items in 2015;
|
§
|
$22 million higher income tax benefit in 2015 from foreign currency translation and inflation adjustments; and
|
§
|
$14 million lower U.S. income tax expense in 2015 as a result of lower planned repatriation of current year earnings from certain non-U.S. subsidiaries, as discussed below; offset by
|
§
|
$25 million income tax benefit in 2014 due to the release of Louisiana state valuation allowance against a deferred tax asset associated with Cameron LNG developments.
|
§
|
higher unfavorable impact on our effective tax rate in 2015 from the reversal through book depreciation of previously recognized tax benefits for a certain portion of utility fixed assets; offset by
|
§
|
higher exclusions from taxable income of the equity portion of AFUDC.
|
§
|
$17 million charge in 2014 to reduce certain tax regulatory assets attributed to SDG&E’s investment in SONGS that we discuss in Note 9 of the Notes to Condensed Consolidated Financial Statements herein; and
|
§
|
$9 million higher favorable resolution of prior years’ income tax items in 2015.
|
§
|
$11 million higher favorable resolution of prior years’ income tax items in 2015; and
|
§
|
lower flow-through component of state income taxes.
|
§
|
$14 million higher favorable resolution of prior years’ income tax items in 2015; and
|
§
|
higher exclusions from taxable income of the equity portion of AFUDC.
|
MEXICAN CURRENCY IMPACT ON INCOME TAXES AND RELATED ECONOMIC HEDGING ACTIVITY
|
||||||||||
(Dollars in millions)
|
||||||||||
Three months ended
|
Nine months ended
|
|||||||||
September 30,
|
September 30,
|
|||||||||
2015
|
2014
|
2015
|
2014
|
|||||||
Income tax benefit on currency exchange
|
||||||||||
rate movement of monetary assets and liabilities
|
$
|
15
|
$
|
4
|
$
|
23
|
$
|
4
|
||
Translation of non-U.S. deferred income tax balances
|
6
|
5
|
10
|
5
|
||||||
Income tax expense on inflation
|
(1)
|
―
|
(1)
|
(1)
|
||||||
Total impact included in Income Tax Benefit
|
20
|
9
|
32
|
8
|
||||||
After-tax losses on Mexican peso exchange rate
|
||||||||||
instruments (included in Other Income, Net)
|
(3)
|
(4)
|
(4)
|
(4)
|
||||||
Net impacts on Sempra Energy Condensed
|
||||||||||
Consolidated Statements of Operations
|
$
|
17
|
$
|
5
|
$
|
28
|
$
|
4
|
§
|
start of operations in December 2014 of Los Ramones I, a pipeline which IEnova owns through GdC, a joint venture with PEMEX;
|
§
|
higher earnings from the Energía Sierra Juárez wind-powered electric generation facility commencing operations in the second quarter of 2015; and
|
§
|
equity-related AFUDC for the Los Ramones Norte pipeline project, which IEnova is developing under a joint venture with PEMEX and affiliates of PEMEX.
|
AVAILABLE FUNDS AT SEPTEMBER 30, 2015
|
|||||||
(Dollars in millions)
|
|||||||
Sempra Energy
|
|||||||
Consolidated
|
SDG&E
|
SoCalGas
|
|||||
Unrestricted cash and cash equivalents(1)
|
$
|
697
|
$
|
20
|
$
|
123
|
|
Available unused credit(2)
|
3,355
|
614
|
658
|
||||
(1)
|
Amounts at Sempra Energy Consolidated include $525 million held in non-U.S. jurisdictions that are unavailable to fund U.S. operations unless repatriated, as we discuss below.
|
||||||
(2)
|
Available credit is the total available on Sempra Energy's, Sempra Global's and the California Utilities' credit facilities that we discuss in Note 6 of the Notes to Condensed Consolidated Financial Statements herein. At September 30, 2015, borrowings on the shared line of credit at SDG&E and SoCalGas were limited to $658 million for each utility and a combined total of $877 million. SDG&E's available funds reflect commercial paper outstanding of $44 million supported by the line. Some of Sempra Energy's subsidiaries, primarily our foreign operations, have additional general purpose credit facilities, aggregating $945 million at September 30, 2015. Available unused credit on these lines totaled $485 million at September 30, 2015.
|
§
|
finance capital expenditures
|
§
|
meet liquidity requirements
|
§
|
fund shareholder dividends
|
§
|
fund new business acquisitions or start-ups
|
§
|
repay maturing long-term debt
|
CASH PROVIDED BY OPERATING ACTIVITIES
|
||||||||
(Dollars in millions)
|
||||||||
Nine months ended
September 30, 2015
|
2015 Change
|
Nine months ended
September 30, 2014
|
||||||
Sempra Energy Consolidated
|
$
|
2,089
|
$
|
428
|
26
|
%
|
$
|
1,661
|
SDG&E
|
1,094
|
273
|
33
|
821
|
||||
SoCalGas
|
690
|
94
|
16
|
596
|
§
|
$140 million higher net income, adjusted for noncash items included in earnings, in 2015 compared to 2014, primarily due to improved operations at the California Utilities and Sempra South American Utilities, as well as higher pipeline earnings at Sempra Mexico, as we discuss in “Results of Operations” above;
|
§
|
$182 million net decrease in net undercollected regulatory balancing accounts in 2015 at the California Utilities (including long-term amounts included in regulatory assets) compared to a $243 million net increase in 2014. Over- and undercollected regulatory balancing accounts reflect the difference between customer billings and recorded or CPUC-authorized costs. These differences are required to be balanced over time. See further discussion of changes in regulatory balances at both SDG&E and SoCalGas below;
|
§
|
$41 million increase in inventories in 2015 compared to a $211 million increase in 2014. The 2014 increase was mainly due to higher storage volume and higher gas prices at SoCalGas; and
|
§
|
$117 million lower income tax payments in 2015; offset by
|
§
|
$130 million decrease in accounts payable in 2015 compared to a $52 million increase in 2014, primarily due to lower volumes and average cost of natural gas purchased at SoCalGas;
|
§
|
$144 million increase in greenhouse gas allowances ($93 million at SDG&E and $51 million at SoCalGas); and
|
§
|
$145 million decrease in accounts receivable in 2015 compared to a $243 million decrease in 2014.
|
§
|
$244 million decrease in net undercollected regulatory balancing accounts in 2015 (including long-term amounts included in regulatory assets) compared to a $38 million increase in 2014;
|
§
|
$102 million higher net income, adjusted for noncash items included in earnings, in 2015 compared to 2014, primarily due to improved operations; and
|
§
|
$70 million decrease in settlement payments and associated legal fees for wildfire claims in 2015 compared to 2014; offset by
|
§
|
$93 million increase in greenhouse gas allowances in 2015; and
|
§
|
$62 million income tax payments in 2015.
|
§
|
$10 million increase in inventories in 2015 compared to a $153 million increase in 2014. The 2014 increase was mainly due to higher storage volume and higher gas prices;
|
§
|
$62 million increase in net undercollected regulatory balancing accounts in 2015 (including long-term amounts included in regulatory assets) compared to a $205 million increase in 2014, primarily due to a lower increase in 2015 associated with the fixed cost balancing accounts; and
|
§
|
$29 million higher net income, adjusted for noncash items included in earnings, in 2015 compared to 2014, primarily due to improved operations; offset by
|
§
|
$191 million decrease in accounts payable in 2015 compared to a $14 million decrease in 2014. The decrease in 2015 was primarily due to lower volumes and average cost of natural gas purchased; and
|
§
|
$51 million increase in greenhouse gas allowances in 2015.
|
CONTRIBUTIONS TO PENSION AND OTHER POSTRETIREMENT BENEFIT PLANS
|
||||
(Dollars in millions)
|
||||
Nine months ended September 30, 2015
|
||||
Other
|
||||
Pension
|
postretirement
|
|||
benefits
|
benefits
|
|||
Sempra Energy Consolidated
|
$
|
27
|
$
|
3
|
SDG&E
|
2
|
―
|
||
SoCalGas
|
1
|
―
|
CASH USED IN INVESTING ACTIVITIES
|
||||||||
(Dollars in millions)
|
||||||||
Nine months ended
|
Nine months ended
|
|||||||
September 30, 2015
|
2015 Change
|
September 30, 2014
|
||||||
Sempra Energy Consolidated
|
$
|
(1,979)
|
$
|
(487)
|
(20)
|
%
|
$
|
(2,466)
|
SDG&E
|
(810)
|
14
|
2
|
(796)
|
||||
SoCalGas
|
(1,196)
|
151
|
14
|
(1,045)
|
§
|
$347 million of net proceeds received from Sempra Natural Gas’ sale of the remaining 625-MW block of its Mesquite Power plant;
|
§
|
$93 million decrease in capital expenditures, primarily due to completion of wind and solar projects at Sempra Renewables in 2014 and the Energía Sierra Juárez project at Sempra Mexico, and higher capital expenditures in 2014 for the Cameron liquefaction project prior to the formation of the Cameron LNG joint venture, offset by increased capital expenditures at the California Utilities in 2015; and
|
§
|
$131 million net decrease in advances to unconsolidated affiliates; offset by
|
§
|
in 2014, $66 million, net of $2 million cash sold, of proceeds received from the sale of a 50-percent equity interest in Copper Mountain Solar 3; and
|
§
|
in 2014, $24 million, net of $2 million cash sold, of proceeds received from the sale of a 50-percent equity interest in Energía Sierra Juárez.
|
§
|
$45 million increase in capital expenditures; offset by
|
§
|
$37 million decrease in Nuclear Decommissioning Trust assets in 2015 as a result of CPUC authorization to access trust funds for SONGS decommissioning costs incurred in 2013. We discuss the Nuclear Decommissioning Trust further in Note 9 of the Notes to Condensed Consolidated Financial Statements herein.
|
§
|
$182 million increase in capital expenditures; offset by
|
§
|
$31 million lower advances to Sempra Energy.
|
§
|
$2.4 billion at the California Utilities for capital projects and plant improvements ($1.1 billion at SDG&E and $1.3 billion at SoCalGas)
|
§
|
$2.4 billion at our other subsidiaries for the acquisition of our joint venture partner’s 50-percent interest in GdC, capital projects in Mexico and South America, and development of LNG, natural gas and renewable generation projects
|
§
|
$700 million for improvements to natural gas, including pipeline safety, and electric generation and distribution systems
|
§
|
$400 million for improvements to electric transmission systems
|
§
|
$10 million for electric generation plants and equipment
|
§
|
$1.1 billion for improvements to distribution, transmission and storage systems, and for pipeline safety
|
§
|
$210 million for advanced metering infrastructure
|
§
|
$30 million for other natural gas projects
|
§
|
approximately $210 million for capital projects in South America (approximately $160 million and $50 million in Peru and Chile, respectively), primarily related to improvements to electric transmission and distribution systems
|
§
|
approximately $1.7 billion in Mexico, net of project financing, including
|
□
|
approximately $1.3 billion for the acquisition of our joint venture partner’s 50-percent interest in GdC, as we discuss in Note 3 of the Notes to Condensed Consolidated Financial Statements herein. Following the acquisition, Sempra Mexico is expected to fund 100 percent of the joint venture’s projects, which excludes the Los Ramones Norte pipeline project
|
□
|
approximately $380 million for capital projects, including approximately $350 million for the development of the Sonora, Ojinaga, and San Isidro – Samalayuca pipeline projects, all developed solely by Sempra Mexico.
|
§
|
approximately $170 million for the development of wind and solar renewable projects, including the Black Oak Getty wind project, Mesquite Solar 2, Mesquite Solar 3 and Copper Mountain Solar 4
|
§
|
approximately $300 million for development of LNG and natural gas transportation projects, including
|
□
|
approximately $160 million equity investment in Rockies Express
|
□
|
approximately $50 million capitalized interest related to our investment in the Cameron LNG JV project, and $40 million for development of the Cameron Interstate Pipeline
|
§
|
approximately $50 million primarily related to the build-to-suit lease for Sempra Energy’s new headquarters
|
CASH FLOWS FROM FINANCING ACTIVITIES
|
|||||||
(Dollars in millions)
|
|||||||
Nine months ended
|
Nine months ended
|
||||||
September 30, 2015
|
2015 Change
|
September 30, 2014
|
|||||
Sempra Energy Consolidated
|
$
|
29
|
$
|
(543)
|
$
|
572
|
|
SDG&E
|
(272)
|
(253)
|
(19)
|
||||
SoCalGas
|
544
|
97
|
447
|
§
|
$1 billion lower issuances of debt, including a decrease in commercial paper and other short-term debt borrowings with maturities greater than 90 days of $929 million ($460 million in 2015 compared to $1.4 billion in 2014), and lower issuances of long-term debt of $76 million ($1.6 billion in 2015 compared to $1.7 billion in 2014); and
|
§
|
$201 million decrease in short-term debt in 2015 compared to a $111 million decrease in 2014; offset by
|
§
|
$529 million lower payments on debt, including lower payments of long-term debt of $710 million ($422 million in 2015 compared to $1.1 billion in 2014), offset by higher payments of commercial paper and other short-term debt with maturities greater than 90 days of $181 million ($894 million in 2015 compared to $713 million in 2014).
|
§
|
$272 million higher payments on long-term debt in 2015;
|
§
|
$150 million common dividends paid in 2015; and
|
§
|
$202 million decrease in short-term debt in 2015 compared to a $59 million decrease in 2014; offset by
|
§
|
$288 million higher issuances of long-term debt in 2015.
|
§
|
$250 million payments of long-term debt in 2014; offset by
|
§
|
$148 million lower issuances of long-term debt in 2015.
|
§
|
SONGS Outage and Retirement
|
§
|
Settlement Agreement to Resolve the CPUC’s Order Instituting Investigation (OII) into the SONGS Outage (SONGS OII)
|
§
|
Settlement with Nuclear Electric Insurance Limited (NEIL)
|
§
|
Nuclear Regulatory Commission Proceedings
|
§
|
Nuclear Decommissioning and Funding
|
§
|
Nuclear Decommissioning Trusts
|
§
|
Legal Proceedings – SDG&E – Lawsuit Against Mitsubishi Heavy Industries, Ltd.
|
§
|
Nuclear Insurance
|
§
|
U.S. Department of Energy (DOE) Nuclear Fuel Disposal
|
§
|
Bay Gas, a facility located 40 miles north of Mobile, Alabama, that provides underground storage and delivery of natural gas. Sempra Natural Gas owns 91 percent of the project. It is the easternmost salt dome storage facility on the Gulf Coast, with direct service to the Florida market and markets across the Southeast, Mid-Atlantic and Northeast regions.
|
§
|
Mississippi Hub, located 45 miles southeast of Jackson, Mississippi, an underground salt dome natural gas storage project with access to shale basins of East Texas and Louisiana, traditional gulf supplies and LNG, with multiple interconnections to serve the Southeast and Northeast regions.
|
§
|
LA Storage, a salt cavern development project in Cameron Parish, Louisiana. Sempra Natural Gas owns 76 percent of the project and ProLiance Transportation LLC owns the remaining 24 percent. The project’s location provides access to several LNG facilities in the area.
|
NOMINAL AMOUNT AND ONE-YEAR VALUE AT RISK OF LONG-TERM DEBT(1)
|
|||||||||||||||
(Dollars in millions)
|
|||||||||||||||
Sempra Energy
|
|||||||||||||||
Consolidated
|
SDG&E
|
SoCalGas
|
|||||||||||||
Nominal
|
One-year
|
Nominal
|
One-year
|
Nominal
|
One-year
|
||||||||||
debt
|
VaR(2)
|
debt
|
VaR(2)
|
debt
|
VaR(2)
|
||||||||||
At September 30, 2015:
|
|||||||||||||||
California Utilities fixed-rate
|
$
|
6,612
|
$
|
772
|
$
|
4,100
|
$
|
499
|
$
|
2,512
|
$
|
274
|
|||
California Utilities variable-rate
|
457
|
10
|
457
|
10
|
―
|
―
|
|||||||||
All other, fixed-rate and variable-rate
|
6,272
|
377
|
―
|
―
|
―
|
―
|
|||||||||
At December 31, 2014:
|
|||||||||||||||
California Utilities fixed-rate
|
$
|
6,049
|
$
|
502
|
$
|
4,136
|
$
|
341
|
$
|
1,913
|
$
|
161
|
|||
California Utilities variable-rate
|
325
|
13
|
325
|
13
|
―
|
―
|
|||||||||
All other, fixed-rate and variable-rate
|
5,973
|
306
|
―
|
―
|
―
|
―
|
|||||||||
(1)
|
Excluding capital lease obligations, build-to-suit lease and interest rate swaps, and before reductions/increases for unamortized discount/premium.
|
||||||||||||||
(2)
|
After the effects of interest rate swaps.
|
EXHIBIT 12 -- STATEMENTS RE: COMPUTATION OF RATIOS
|
|||
Sempra Energy
|
|||
12.1
|
Sempra Energy Computation of Ratio of Earnings to Combined Fixed Charges and Preferred
|
||
Stock Dividends.
|
|||
San Diego Gas & Electric Company
|
|||
12.2
|
San Diego Gas & Electric Computation of Ratio of Earnings to Combined Fixed Charges and
|
||
Preferred Stock Dividends.
|
|||
Southern California Gas Company
|
|||
12.3
|
Southern California Gas Company Computation of Ratio of Earnings to Combined Fixed
|
||
Charges and Preferred Stock Dividends.
|
|||
EXHIBIT 31 -- SECTION 302 CERTIFICATIONS
|
|||
Sempra Energy
|
|||
31.1
|
Statement of Sempra Energy’s Chief Executive Officer pursuant to Rules 13a-14 and 15d-14
|
||
of the Securities Exchange Act of 1934.
|
|||
31.2
|
Statement of Sempra Energy’s Chief Financial Officer pursuant to Rules 13a-14 and 15d-14
|
||
of the Securities Exchange Act of 1934.
|
|||
San Diego Gas & Electric Company
|
|||
31.3
|
Statement of San Diego Gas & Electric Company’s Chief Executive Officer pursuant to Rules
|
||
13a-14 and 15d-14 of the Securities Exchange Act of 1934.
|
|||
31.4
|
Statement of San Diego Gas & Electric Company’s Chief Financial Officer pursuant to Rules
|
||
13a-14 and 15d-14 of the Securities Exchange Act of 1934.
|
|||
Southern California Gas Company
|
|||
31.5
|
Statement of Southern California Gas Company’s Chief Executive Officer pursuant to Rules
|
||
13a-14 and 15d-14 of the Securities Exchange Act of 1934.
|
|||
31.6
|
Statement of Southern California Gas Company’s Chief Financial Officer pursuant to Rules
|
||
13a-14 and 15d-14 of the Securities Exchange Act of 1934.
|
|||
EXHIBIT 32 -- SECTION 906 CERTIFICATIONS
|
|||
Sempra Energy
|
|||
32.1
|
Statement of Sempra Energy’s Chief Executive Officer pursuant to 18 U.S.C. Sec. 1350.
|
||
32.2
|
Statement of Sempra Energy’s Chief Financial Officer pursuant to 18 U.S.C. Sec. 1350.
|
||
San Diego Gas & Electric Company
|
|||
32.3
|
Statement of San Diego Gas & Electric Company’s Chief Executive Officer pursuant to 18
|
||
U.S.C. Sec. 1350.
|
|||
32.4
|
Statement of San Diego Gas & Electric Company’s Chief Financial Officer pursuant to 18
|
||
U.S.C. Sec. 1350.
|
|||
Southern California Gas Company
|
|||
32.5
|
Statement of Southern California Gas Company’s Chief Executive Officer pursuant to 18
|
||
U.S.C. Sec. 1350.
|
|||
32.6
|
Statement of Southern California Gas Company’s Chief Financial Officer pursuant to 18
|
||
U.S.C. Sec. 1350.
|
|||
EXHIBIT 101 -- INTERACTIVE DATA FILE
|
|||
Sempra Energy / San Diego Gas & Electric Company / Southern California Gas Company
|
|||
101.INS
|
XBRL Instance Document
|
||
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
||
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
||
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
||
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
||
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
SIGNATURES
|
|
Sempra Energy:
|
|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
SEMPRA ENERGY,
(Registrant)
|
|
|
|
Date: November 3, 2015
|
By: /s/ Trevor I. Mihalik
|
Trevor I. Mihalik
Senior Vice President, Controller and
Chief Accounting Officer
|
San Diego Gas & Electric Company:
|
|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
SAN DIEGO GAS & ELECTRIC COMPANY,
(Registrant)
|
|
|
|
Date: November 3, 2015
|
By: /s/ Bruce A. Folkmann
|
Bruce A. Folkmann
Vice President, Controller, Chief Financial Officer and Chief Accounting Officer
|
Southern California Gas Company:
|
|
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
|
|
SOUTHERN CALIFORNIA GAS COMPANY,
(Registrant)
|
|
|
|
Date: November 3, 2015
|
By: /s/ Bruce A. Folkmann
|
Bruce A. Folkmann
Vice President, Controller, Chief Financial Officer and Chief Accounting Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
EXHIBIT 12.3 |
|
| ||||||||||||||||||
SOUTHERN CALIFORNIA GAS COMPANY |
|
| ||||||||||||||||||
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES |
|
| ||||||||||||||||||
AND PREFERRED STOCK DIVIDENDS |
|
| ||||||||||||||||||
(Dollars in millions) |
|
| ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| September 30, | ||
|
|
| 2010 |
|
| 2011 |
|
| 2012 |
|
| 2013 |
|
| 2014 |
|
| 2015 | ||
Fixed charges and preferred stock dividends: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Interest |
| $ | 72 |
| $ | 77 |
| $ | 77 |
| $ | 76 |
| $ | 77 |
| $ | 70 | ||
Interest portion of annual rentals |
|
| 2 |
|
| 1 |
|
| 1 |
|
| 1 |
|
| 2 |
|
| 1 | ||
Total fixed charges |
|
| 74 |
|
| 78 |
|
| 78 |
|
| 77 |
|
| 79 |
|
| 71 | ||
Preferred stock dividends (1) |
|
| 2 |
|
| 2 |
|
| 2 |
|
| 2 |
|
| 2 |
|
| 1 | ||
Combined fixed charges and preferred stock dividends for purpose of ratio |
| $ | 76 |
| $ | 80 |
| $ | 80 |
| $ | 79 |
| $ | 81 |
| $ | 72 | ||
Earnings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Pretax income from continuing operations |
| $ | 463 |
| $ | 431 |
| $ | 369 |
| $ | 481 |
| $ | 472 |
| $ | 368 | ||
Add: Total fixed charges (from above) |
|
| 74 |
|
| 78 |
|
| 78 |
|
| 77 |
|
| 79 |
|
| 71 | ||
Less: Interest capitalized |
|
| 1 |
|
| 1 |
|
| 1 |
|
| 1 |
|
| 1 |
|
| 1 | ||
Total earnings for purpose of ratio |
| $ | 536 |
| $ | 508 |
| $ | 446 |
| $ | 557 |
| $ | 550 |
| $ | 438 | ||
Ratio of earnings to combined fixed charges and preferred stock dividends |
|
| 7.05 |
|
| 6.35 |
|
| 5.58 |
|
| 7.05 |
|
| 6.79 |
|
| 6.08 | ||
Ratio of earnings to fixed charges |
|
| 7.24 |
|
| 6.51 |
|
| 5.72 |
|
| 7.23 |
|
| 6.96 |
|
| 6.17 | ||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
(1) | In computing this ratio, Preferred stock dividends represents the before-tax earnings necessary to pay such dividends, computed at the effective tax rates for the applicable periods. | |||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EXHIBIT 31.1
CERTIFICATION
I, Debra L. Reed, certify that:
1.
I have reviewed this report on Form 10-Q of Sempra Energy;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 3, 2015
/s/ Debra L. Reed |
Debra L. Reed |
Chief Executive Officer |
EXHIBIT 31.2
CERTIFICATION
I, Joseph A. Householder, certify that:
1.
I have reviewed this report on Form 10-Q of Sempra Energy;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 3, 2015
/s/ Joseph A. Householder |
Joseph A. Householder |
Chief Financial Officer |
EXHIBIT 31.3
CERTIFICATION
I, J. Walker Martin, certify that:
1.
I have reviewed this report on Form 10-Q of San Diego Gas & Electric Company;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 3, 2015
/s/ J. Walker Martin |
J. Walker Martin |
Chief Executive Officer |
EXHIBIT 31.4
CERTIFICATION
I, Bruce A. Folkmann, certify that:
1.
I have reviewed this report on Form 10-Q of San Diego Gas & Electric Company;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 3, 2015
/s/ Bruce A. Folkmann |
Bruce A. Folkmann |
Chief Financial Officer |
EXHIBIT 31.5
CERTIFICATION
I, Dennis V. Arriola, certify that:
1.
I have reviewed this report on Form 10-Q of Southern California Gas Company;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 3, 2015
/s/ Dennis V. Arriola |
Dennis V. Arriola |
Chief Executive Officer |
EXHIBIT 31.6
CERTIFICATION
I, Bruce A. Folkmann, certify that:
1.
I have reviewed this report on Form 10-Q of Southern California Gas Company;
2.
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13(a)-15(f) and 15d-15(f)) for the registrant and have:
a)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
c)
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report, based on such evaluation; and
d)
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of registrant's board of directors (or persons performing the equivalent functions):
a)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
b)
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
November 3, 2015
/s/ Bruce A. Folkmann |
Bruce A. Folkmann |
Chief Financial Officer |
Exhibit 32.1
Statement of Chief Executive Officer
Pursuant to 18 U.S.C. Sec 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Chief Executive Officer of Sempra Energy (the "Company") certifies that:
(i)
the Quarterly Report on Form 10-Q of the Company filed with the Securities and Exchange Commission for the quarter ended September 30, 2015 (the "Quarterly Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(ii)
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
November 3, 2015
/s/ Debra L. Reed |
Debra L. Reed |
Chief Executive Officer |
Exhibit 32.2
Statement of Chief Financial Officer
Pursuant to 18 U.S.C. Sec 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Chief Financial Officer of Sempra Energy (the "Company") certifies that:
(i)
the Quarterly Report on Form 10-Q of the Company filed with the Securities and Exchange Commission for the quarter ended September 30, 2015 (the "Quarterly Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(ii)
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
November 3, 2015
Exhibit 32.3
Statement of Chief Executive Officer
Pursuant to 18 U.S.C. Sec 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Chief Executive Officer of San Diego Gas & Electric Company (the "Company") certifies that:
(i)
the Quarterly Report on Form 10-Q of the Company filed with the Securities and Exchange Commission for the quarter ended September 30, 2015 (the "Quarterly Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(ii)
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
November 3, 2015
/s/ J. Walker Martin |
J. Walker Martin |
Chief Executive Officer |
Exhibit 32.4
Statement of Chief Financial Officer
Pursuant to 18 U.S.C. Sec 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Chief Financial Officer of San Diego Gas & Electric Company (the "Company") certifies that:
(i)
the Quarterly Report on Form 10-Q of the Company filed with the Securities and Exchange Commission for the quarter ended September 30, 2015 (the "Quarterly Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(ii)
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
November 3, 2015
/s/ Bruce A. Folkmann |
Bruce A. Folkmann |
Chief Financial Officer |
Exhibit 32.5
Statement of Chief Executive Officer
Pursuant to 18 U.S.C. Sec 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Chief Executive Officer of Southern California Gas Company (the "Company") certifies that:
(i)
the Quarterly Report on Form 10-Q of the Company filed with the Securities and Exchange Commission for the quarter ended September 30, 2015 (the "Quarterly Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(ii)
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
November 3, 2015
/s/ Dennis V. Arriola |
Dennis V. Arriola |
Chief Executive Officer |
Exhibit 32.6
Statement of Chief Financial Officer
Pursuant to 18 U.S.C. Sec 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002, the undersigned Chief Financial Officer of Southern California Gas Company (the "Company") certifies that:
(i)
the Quarterly Report on Form 10-Q of the Company filed with the Securities and Exchange Commission for the quarter ended September 30, 2015 (the "Quarterly Report") fully complies with the requirements of Section 13(a) or Section 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and
(ii)
the information contained in the Quarterly Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
November 3, 2015
/s/ Bruce A. Folkmann |
Bruce A. Folkmann |
Chief Financial Officer |