0000086521-17-000033 | 10-Q | XBRL Viewer

(714)

(701)

^[1]

Franchise fees and other taxes

(360)

(328)

^[1],[2]

(110)

(111)

^[1]

Equity earnings (losses), before income tax

(22)

^[1]

Operating expenses

Other income, net

169

^[1]

Interest income

^[1]

Income before income taxes and equity (losses) earnings of certain unconsolidated subsidiaries

(169)

(143)

^[1]

755

455

^[1]

Equity (losses) earnings, net of income tax

(295)

(108)

^[1]

(8)

^[1]

452

364

^[1],[2]

(11)

^[1]

Basic earnings per common share (in dollars per share)

$ 441

$ 353

^[1]

$ 1.76

$ 1.41

^[1]

Weighted-average number of shares outstanding, basic

251,131

249,734

^[1]

Diluted earnings per common share (in dollars per share)

$ 1.75

$ 1.40

^[1]

Weighted-average number of shares outstanding, diluted

252,246

251,487

^[1]

Dividends declared per share of common stock (in dollars per share)

$ 0.82

$ 0.76

^[1]

Operating revenues

Electric

$ 875

$ 843

^[1]

Cost of electric fuel and purchased power

182

148

^[1]

Total operating revenues

1,057

991

^[1]

Operating expenses

261

248

^[1]

Cost of natural gas

^[1]

227

246

^[1]

Franchise fees and other taxes

163

159

^[1],[2]

^[1]

Total operating expenses

779

755

^[1]

278

236

^[1]

Other income, net

^[1]

Income before income taxes and equity (losses) earnings of certain unconsolidated subsidiaries

(49)

(48)

^[1]

247

202

^[1]

(90)

(65)

^[1]

157

137

^[1],[2]

Net income/Earnings attributable to common shares

(2)

(1)

^[1]

155

136

^[1]

Operating revenues

Total operating revenues

1,241

1,033

^[1]

Operating expenses

Cost of natural gas

408

253

^[1]

353

327

^[1]

Franchise fees and other taxes

126

122

^[1],[2]

^[1]

Total operating expenses

926

739

^[1]

315

294

^[1]

Other income, net

^[1]

Income before income taxes and equity (losses) earnings of certain unconsolidated subsidiaries

(25)

(22)

^[1]

301

282

^[1]

Net income/Earnings attributable to common shares

(98)

(83)

^[1]

^[1]

$ 203

$ 199

^[2]

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[2]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

$ 452

$ 364

^[1],[2]

515

349

Pretax amount [Member]

736

461

^[3]

^[3]

(159)

^[3]

^[3]

(89)

^[3]

Income tax (expense) benefit [Member]

792

372

^[3]

(295)

(108)

^[3]

^[3]

(3)

^[3]

(1)

^[3]

(4)

^[3]

Net-of-tax amount [Member]

(299)

(34)

^[3]

441

353

^[3]

^[3]

(84)

^[3]

^[3]

(15)

^[3]

Noncontrolling Interests (after-tax) [Member]

493

338

^[3]

^[3]

^[3]

(5)

^[3]

^[3]

^[3]

^[3]

Total [Member]

452

364

^[3]

^[3]

(89)

^[3]

^[3]

(15)

^[3]

515

349

^[3]

157

137

^[1],[2]

San Diego Gas and Electric Company [Member] | Pretax amount [Member]

160

135

245

201

^[3]

^[3]

^[3]

San Diego Gas and Electric Company [Member] | Income tax (expense) benefit [Member]

245

201

^[3]

(90)

(65)

^[3]

^[3]

^[3]

San Diego Gas and Electric Company [Member] | Net-of-tax amount [Member]

(90)

(65)

^[3]

155

136

^[3]

^[3]

^[3]

San Diego Gas and Electric Company [Member] | Noncontrolling Interests (after-tax) [Member]

155

136

^[3]

^[3]

(2)

^[3]

(2)

^[3]

San Diego Gas and Electric Company [Member] | Total [Member]

(1)

^[3]

157

137

^[3]

(2)

^[3]

(2)

^[3]

160

135

^[3]

Southern California Gas Company [Member] | Pretax amount [Member]

203

199

301

282

^[3]

Southern California Gas Company [Member] | Income tax (expense) benefit [Member]

301

282

(98)

(83)

^[3]

Southern California Gas Company [Member] | Net-of-tax amount [Member]

(98)

(83)

203

199

^[3]

Cash and cash equivalents

$ 203

$ 199

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[2]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[3]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)

Mar. 31, 2017

Dec. 31, 2016

Current assets:

$ 290,000,000

$ 349,000,000

^[1]

Accounts receivable – trade, net

72,000,000

66,000,000

^[1]

1,267,000,000

1,390,000,000

^[1]

Accounts receivable – other, net

201,000,000

164,000,000

^[1]

Regulatory balancing accounts – undercollected

24,000,000

26,000,000

^[1]

Income taxes receivable

65,000,000

43,000,000

^[1]

Inventories

210,000,000

258,000,000

^[1]

202,000,000

259,000,000

^[1]

161,000,000

83,000,000

^[1]

Assets held for sale

196,000,000

201,000,000

^[1]

265,000,000

271,000,000

^[1]

Total current assets

2,953,000,000

3,110,000,000

^[1]

Other assets:

5,000,000

10,000,000

^[1]

187,000,000

201,000,000

^[1]

3,503,000,000

3,414,000,000

^[1]

Dedicated assets in support of certain benefit plans

1,062,000,000

1,026,000,000

^[1]

Investments

2,120,000,000

2,097,000,000

^[1]

Goodwill

2,380,000,000

2,364,000,000

^[1]

Other intangible assets

544,000,000

548,000,000

^[1]

412,000,000

430,000,000

^[1]

621,000,000

606,000,000

^[1]

188,000,000

234,000,000

^[1]

Property, plant and equipment

817,000,000

815,000,000

^[1]

Total other assets

11,839,000,000

11,745,000,000

^[1]

Property, plant and equipment:

44,404,000,000

43,624,000,000

^[1]

Less accumulated depreciation and amortization

(10,912,000,000)

(10,693,000,000)

^[1]

33,492,000,000

32,931,000,000

^[1]

Due to unconsolidated affiliates

48,284,000,000

47,786,000,000

^[1]

Current liabilities:

Short-term debt

2,054,000,000

1,779,000,000

^[1]

Accounts payable – trade

969,000,000

1,346,000,000

^[1]

Accounts payable – other

123,000,000

130,000,000

^[1]

13,000,000

11,000,000

^[1]

Dividends and interest payable

382,000,000

319,000,000

^[1]

Accrued compensation and benefits

239,000,000

409,000,000

^[1]

Regulatory balancing accounts – overcollected

189,000,000

122,000,000

^[1]

Current portion of long-term debt

839,000,000

913,000,000

^[1]

115,000,000

83,000,000

^[1]

Customer deposits

160,000,000

158,000,000

^[1]

Liabilities held for sale

^[1]

53,000,000

40,000,000

47,000,000

^[1]

Total current liabilities

640,000,000

557,000,000

^[1]

5,812,000,000

5,927,000,000

^[1]

Long-term debt

14,409,000,000

14,429,000,000

^[1]

Deferred credits and other liabilities:

Customer advances for construction

145,000,000

152,000,000

^[1]

Pension and other postretirement benefit plan obligations, net of plan assets

1,212,000,000

1,208,000,000

^[1]

Deferred investment tax credits

4,025,000,000

3,745,000,000

^[1]

26,000,000

28,000,000

^[1]

Regulatory liabilities arising from removal obligations

2,761,000,000

2,697,000,000

^[1]

2,455,000,000

2,431,000,000

^[1]

343,000,000

405,000,000

^[1]

Total deferred credits and other liabilities

1,527,000,000

1,523,000,000

^[1]

12,494,000,000

12,189,000,000

^[1]

Commitments and contingencies (Note 11)

^[1]

Equity:

Preferred stock

^[1]

Common stock

3,008,000,000

2,982,000,000

^[1]

Retained earnings

10,952,000,000

10,717,000,000

^[1]

Accumulated other comprehensive income (loss)

(696,000,000)

(748,000,000)

^[1]

Total shareholders’ equity

13,264,000,000

12,951,000,000

^[1]

Preferred stock of subsidiary

20,000,000

^[1]

Total liabilities and equity

2,285,000,000

2,270,000,000

^[1]

Total equity

15,569,000,000

15,241,000,000

^[1]

48,284,000,000

47,786,000,000

^[1]

Cash and cash equivalents

Current assets:

18,000,000

8,000,000

^[1]

Accounts receivable – trade, net

13,000,000

11,000,000

^[1]

359,000,000

354,000,000

^[1]

Accounts receivable – other, net

23,000,000

17,000,000

^[1]

Regulatory balancing accounts – undercollected

4,000,000

^[1]

Income taxes receivable

85,000,000

122,000,000

^[1]

Inventories

82,000,000

80,000,000

^[1]

Prepaid expenses

46,000,000

59,000,000

^[1]

202,000,000

259,000,000

^[1]

99,000,000

81,000,000

^[1]

39,000,000

58,000,000

^[1]

19,000,000

^[1]

Total current assets

985,000,000

1,072,000,000

^[1]

Other assets:

Deferred income taxes recoverable in rates

1,000,000

^[1]

1,013,000,000

1,014,000,000

^[1]

1,018,000,000

998,000,000

^[1]

1,062,000,000

1,026,000,000

^[1]

Property, plant and equipment

355,000,000

358,000,000

^[1]

Total other assets

3,448,000,000

3,397,000,000

^[1]

Property, plant and equipment:

18,144,000,000

17,844,000,000

^[1]

Less accumulated depreciation and amortization

(4,677,000,000)

(4,594,000,000)

^[1]

13,467,000,000

13,250,000,000

^[1]

Due to unconsolidated affiliates

17,900,000,000

17,719,000,000

^[1]

Current liabilities:

Short-term debt

343,000,000

^[1]

Accounts payable – trade

350,000,000

460,000,000

^[1]

45,000,000

15,000,000

^[1]

Interest payable

47,000,000

40,000,000

^[1]

Accrued compensation and benefits

57,000,000

121,000,000

^[1]

Accrued franchise fees

54,000,000

43,000,000

^[1]

Current portion of long-term debt

51,000,000

191,000,000

^[1]

79,000,000

^[1]

65,000,000

61,000,000

^[1]

Customer deposits

76,000,000

^[1]

Total current liabilities

93,000,000

82,000,000

^[1]

1,260,000,000

1,168,000,000

^[1]

Long-term debt

4,638,000,000

4,658,000,000

^[1]

Deferred credits and other liabilities:

Customer advances for construction

50,000,000

52,000,000

^[1]

Pension and other postretirement benefit plan obligations, net of plan assets

238,000,000

232,000,000

^[1]

Deferred investment tax credits

2,871,000,000

2,829,000,000

^[1]

15,000,000

16,000,000

^[1]

Regulatory liabilities arising from removal obligations

1,790,000,000

1,725,000,000

^[1]

762,000,000

751,000,000

^[1]

197,000,000

189,000,000

^[1]

Total deferred credits and other liabilities

419,000,000

421,000,000

^[1]

6,342,000,000

6,215,000,000

^[1]

Commitments and contingencies (Note 11)

^[1]

Equity:

Preferred stock

^[1]

Common stock

1,338,000,000

^[1]

Retained earnings

4,291,000,000

4,311,000,000

^[1]

Accumulated other comprehensive income (loss)

(8,000,000)

^[1]

Total shareholders’ equity

5,621,000,000

5,641,000,000

^[1]

Total liabilities and equity

39,000,000

37,000,000

^[1]

Total equity

5,660,000,000

5,678,000,000

^[1]

17,900,000,000

17,719,000,000

^[1]

Cash and cash equivalents

Current assets:

21,000,000

12,000,000

^[1]

Accounts receivable – trade, net

503,000,000

608,000,000

^[1]

Accounts receivable – other, net

95,000,000

77,000,000

^[1]

16,000,000

8,000,000

^[1]

Income taxes receivable

2,000,000

^[1]

Inventories

43,000,000

58,000,000

^[1]

6,000,000

8,000,000

^[1]

Regulatory assets arising from pension obligations

52,000,000

63,000,000

^[1]

Total current assets

736,000,000

836,000,000

^[1]

Other assets:

741,000,000

742,000,000

^[1]

661,000,000

589,000,000

^[1]

621,000,000

606,000,000

^[1]

Property, plant and equipment

400,000,000

399,000,000

^[1]

Total other assets

2,423,000,000

2,336,000,000

^[1]

Property, plant and equipment:

15,599,000,000

15,344,000,000

^[1]

Less accumulated depreciation and amortization

(5,156,000,000)

(5,092,000,000)

^[1]

10,443,000,000

10,252,000,000

^[1]

Due to unconsolidated affiliates

13,602,000,000

13,424,000,000

^[1]

Current liabilities:

Short-term debt

62,000,000

^[1]

Accounts payable – trade

330,000,000

481,000,000

^[1]

Accounts payable – other

73,000,000

74,000,000

^[1]

28,000,000

^[1]

Income taxes payable

16,000,000

^[1]

Accrued compensation and benefits

95,000,000

150,000,000

^[1]

Regulatory balancing accounts – overcollected

189,000,000

122,000,000

^[1]

Customer deposits

77,000,000

76,000,000

^[1]

49,000,000

53,000,000

^[1]

Total current liabilities

247,000,000

195,000,000

^[1]

1,076,000,000

1,241,000,000

^[1]

Long-term debt

2,983,000,000

2,982,000,000

^[1]

Deferred credits and other liabilities:

Customer advances for construction

96,000,000

99,000,000

^[1]

Pension obligation, net of plan assets

761,000,000

762,000,000

^[1]

Deferred investment tax credits

1,836,000,000

1,709,000,000

^[1]

11,000,000

12,000,000

^[1]

Regulatory liabilities arising from removal obligations

971,000,000

972,000,000

^[1]

1,628,000,000

1,616,000,000

^[1]

Total deferred credits and other liabilities

527,000,000

521,000,000

^[1]

5,830,000,000

5,691,000,000

^[1]

Commitments and contingencies (Note 11)

^[1]

Equity:

Preferred stock

22,000,000

^[1]

Common stock

866,000,000

^[1]

Retained earnings

2,847,000,000

2,644,000,000

^[1]

Accumulated other comprehensive income (loss)

(22,000,000)

^[1]

Total shareholders’ equity

3,713,000,000

3,510,000,000

^[1]

Total liabilities and equity

$ 13,602,000,000

$ 13,424,000,000

^[1]

[1]	Derived from audited financial statements.

CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($)
$ in Millions

Mar. 31, 2017

Dec. 31, 2016

$ 33,492

$ 32,931

^[1]

Stockholders' Equity Attributable to Parent [Abstract]

$ 14,409

$ 14,429

^[1]

Preferred stock, shares authorized

50,000,000

Preferred stock, shares issued

Common stock, shares authorized

750,000,000

Common stock, shares outstanding

251,000,000

250,000,000

Common stock, No par value (in dollars per share)

$ 0

Otay Mesa VIE [Member]

$ 342

$ 354

291

293

13,467

13,250

^[1]

Stockholders' Equity Attributable to Parent [Abstract]

$ 4,638

$ 4,658

^[1]

Common stock, shares authorized

255,000,000

Common stock, shares outstanding

117,000,000

Common stock, No par value (in dollars per share)

$ 0

San Diego Gas and Electric Company [Member] | Otay Mesa VIE [Member]

$ 342

$ 354

291

293

10,443

10,252

^[1]

Stockholders' Equity Attributable to Parent [Abstract]

$ 2,983

$ 2,982

^[1]

Common stock, shares authorized

100,000,000

Common stock, shares outstanding

91,000,000

Common stock, No par value (in dollars per share)

$ 0

[1]	Derived from audited financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

CASH FLOWS FROM OPERATING ACTIVITIES

Adjustments to reconcile net income to net cash provided by operating activities:

$ 452

$ 364

^[1],[2]

360

328

^[1],[2]

268

^[2]

Equity losses

^[2]

(106)

^[2]

Net change in other working capital components

(22)

^[2]

165

^[2]

Changes in other liabilities

(15)

(335)

^[2]

Changes in other assets

(41)

(29)

^[2]

^[2]

CASH FLOWS FROM INVESTING ACTIVITIES

1,004

626

^[2]

Expenditures for property, plant and equipment

(992)

(971)

^[2]

Expenditures for investments

(59)

(30)

^[2]

Distributions from investments

^[2]

Purchases of nuclear decommissioning and other trust assets

(350)

(94)

^[2]

Proceeds from sales by nuclear decommissioning and other trusts

357

^[2]

Increases in restricted cash

(93)

(16)

^[2]

Decreases in restricted cash

^[2]

Advances to unconsolidated affiliates

(5)

(6)

^[2]

Repayments of advances to unconsolidated affiliates

^[2]

Net cash used in investing activities

(3)

^[2]

(1,026)

(989)

^[2]

CASH FLOWS FROM FINANCING ACTIVITIES

Common dividends paid

(176)

(161)

^[2]

^[2]

Issuances of debt (maturities greater than 90 days)

(14)

(54)

^[2]

542

^[2]

Payments on debt (maturities greater than 90 days)

(313)

(54)

^[2]

(Decrease) increase in short-term debt, net

(97)

531

^[2]

Net cash (used in) provided by financing activities

(5)

(2)

^[2]

(46)

330

^[2]

Effect of exchange rate changes on cash and cash equivalents

^[2]

Increase (decrease) in cash and cash equivalents

(59)

(27)

^[2]

Cash and cash equivalents, January 1

349

^[3]

403

^[2]

Cash and cash equivalents, March 31

290

376

^[2]

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Interest payments, net of amounts capitalized

106

^[2]

Income tax payments, net of refunds

^[2]

SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES

Accrued capital expenditures

378

423

^[2]

Equitization of note receivable due from unconsolidated affiliate

^[2]

Common dividends issued in stock

^[2]

Dividends declared but not paid

216

197

^[2]

CASH FLOWS FROM OPERATING ACTIVITIES

157

137

^[1],[2]

Adjustments to reconcile net income to net cash provided by operating activities:

155

136

^[1]

163

159

^[1],[2]

^[2]

(1)

^[2]

Net change in other working capital components

(12)

(9)

^[2]

103

^[2]

Changes in other assets

(34)

^[2]

Changes in other liabilities

(6)

^[2]

CASH FLOWS FROM INVESTING ACTIVITIES

386

369

^[2]

Expenditures for property, plant and equipment

(418)

(329)

^[2]

Purchases of nuclear decommissioning trust assets

(350)

(93)

^[2]

Proceeds from sales by nuclear decommissioning trusts

357

^[2]

Increases in restricted cash

(10)

^[2]

Decreases in restricted cash

^[2]

(Increase) decrease in loans to affiliate, net

^[2]

Net cash used in investing activities

(1)

^[2]

(381)

(330)

^[2]

CASH FLOWS FROM FINANCING ACTIVITIES

Common dividends paid

(175)

^[2]

Payments on debt (maturities greater than 90 days)

(160)

(20)

^[2]

(Decrease) increase in short-term debt, net

343

(2)

^[2]

Capital distributions made by VIE

(3)

(1)

^[2]

Net cash (used in) provided by financing activities

(23)

^[2]

Increase (decrease) in cash and cash equivalents

^[2]

Cash and cash equivalents, January 1

^[3]

^[2]

Cash and cash equivalents, March 31

^[2]

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Interest payments, net of amounts capitalized

^[2]

Income tax payments, net of refunds

(8)

^[2]

SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES

Accrued capital expenditures

126

104

^[2]

CASH FLOWS FROM OPERATING ACTIVITIES

Adjustments to reconcile net income to net cash provided by operating activities:

^[1]

203

199

^[2]

126

122

^[1],[2]

^[2]

Net change in other working capital components

(5)

(7)

^[2]

243

^[2]

Changes in other liabilities

(15)

(335)

^[2]

Changes in other assets

(21)

(37)

^[2]

(1)

^[2]

CASH FLOWS FROM INVESTING ACTIVITIES

463

241

^[2]

Expenditures for property, plant and equipment

(357)

(340)

^[2]

(Increase) decrease in loans to affiliate, net

(35)

^[2]

Net cash used in investing activities

(392)

(290)

^[2]

CASH FLOWS FROM FINANCING ACTIVITIES

(Decrease) increase in short-term debt, net

(62)

^[2]

Net cash (used in) provided by financing activities

(62)

^[2]

Increase (decrease) in cash and cash equivalents

(44)

^[2]

Cash and cash equivalents, January 1

^[3]

^[2]

Cash and cash equivalents, March 31

^[2]

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

Interest payments, net of amounts capitalized

^[2]

Income tax payments, net of refunds

^[2]

SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES

Accrued capital expenditures

$ 147

$ 148

^[2]

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[2]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[3]	Derived from audited financial statements.

GENERAL

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

General

GENERAL

PRINCIPLES OF CONSOLIDATION

Sempra Energy

Sempra Energy’s Condensed Consolidated Financial Statements include the accounts of Sempra Energy, a California-based Fortune 500 energy-services holding company, and its consolidated subsidiaries and variable interest entities (VIEs). Sempra Energy’s principal operating units are


▪	Sempra Utilities, which includes our San Diego Gas & Electric Company (SDG&E), Southern California Gas Company (SoCalGas) and Sempra South American Utilities reportable segments; and


▪	Sempra Infrastructure, which includes our Sempra Mexico, Sempra Renewables and Sempra LNG & Midstream reportable segments.

We refer to SDG&E and SoCalGas collectively as the California Utilities, which do not include our South American utilities or the utilities in our Sempra Infrastructure operating unit. Sempra Global is the holding company for most of our subsidiaries that are not subject to California utility regulation. All references in these Notes to “Sempra Utilities,” “Sempra Infrastructure” and their respective reportable segments are not intended to refer to any legal entity with the same or similar name.

SDG&E

SDG&E’s Condensed Consolidated Financial Statements include its accounts and the accounts of a VIE of which SDG&E is the primary beneficiary, as we discuss in Note 5 under “Variable Interest Entities.” SDG&E’s common stock is wholly owned by Enova Corporation, which is a wholly owned subsidiary of Sempra Energy.

SoCalGas

SoCalGas’ common stock is wholly owned by Pacific Enterprises, which is a wholly owned subsidiary of Sempra Energy.

BASIS OF PRESENTATION

This is a combined report of Sempra Energy, SDG&E and SoCalGas. We provide separate information for SDG&E and SoCalGas as required. References in this report to “we,” “our” and “Sempra Energy Consolidated” are to Sempra Energy and its consolidated entities, unless otherwise indicated by the context. We have eliminated intercompany accounts and transactions within the consolidated financial statements of each reporting entity.

Throughout this report, we refer to the following as Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements when discussed together or collectively:


▪	the Condensed Consolidated Financial Statements and related Notes of Sempra Energy and its subsidiaries and VIEs;


▪	the Condensed Consolidated Financial Statements and related Notes of SDG&E and its VIE; and


▪	the Condensed Financial Statements and related Notes of SoCalGas.

We have prepared the Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) and in accordance with the interim-period-reporting requirements of Form 10-Q. Results of operations for interim periods are not necessarily indicative of results for the entire year. We evaluated events and transactions that occurred after March 31, 2017 through the date the financial statements were issued and, in the opinion of management, the accompanying statements reflect all adjustments necessary for a fair presentation. These adjustments are only of a normal, recurring nature.

All December 31, 2016 balance sheet information in the Condensed Consolidated Financial Statements has been derived from our audited 2016 Consolidated Financial Statements in the Annual Report on Form 10-K for the year ended December 31, 2016 (Annual Report). Certain information and note disclosures normally included in annual financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the interim-period-reporting provisions of U.S. GAAP and the Securities and Exchange Commission.

We describe our significant accounting policies in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report. We follow the same accounting policies for interim reporting purposes.

You should read the information in this Quarterly Report in conjunction with the Annual Report.

Regulated Operations

The California Utilities and Sempra Mexico’s natural gas distribution utility, Ecogas México, S. de R.L. de C.V. (Ecogas), prepare their financial statements in accordance with the provisions of U.S. GAAP governing rate-regulated operations. We discuss these provisions and revenue recognition at our utilities in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

Sempra South American Utilities has controlling interests in two electric distribution utilities in South America, Chilquinta Energía S.A. (Chilquinta Energía) in Chile and Luz del Sur S.A.A. (Luz del Sur) in Peru, and their subsidiaries. Revenues are based on tariffs that are set by government agencies in their respective countries based on an efficient model distribution company defined by those agencies. Because the tariffs are based on a model and are intended to cover the costs of the model company, but are not based on the costs of the specific utility and may not result in full cost recovery, these utilities do not meet the requirements necessary for, and therefore do not apply, regulatory accounting treatment under U.S. GAAP.

Our Sempra Mexico segment includes the operating companies of our subsidiary, Infraestructura Energética Nova, S.A.B. de C.V. (IEnova). Certain business activities at IEnova are regulated by the Comisión Reguladora de Energía (or CRE, the Energy Regulatory Commission) and meet the regulatory accounting requirements of U.S. GAAP. Pipeline projects currently under construction by IEnova that meet the regulatory accounting requirements of U.S. GAAP record the impact of allowance for funds used during construction (AFUDC) related to equity. We discuss AFUDC in Note 5 below and in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

Sempra LNG & Midstream owned Mobile Gas Service Corporation (Mobile Gas) in southwest Alabama and Willmut Gas Company (Willmut Gas) in Mississippi until they were sold in September 2016, as we discuss in Note 3 of the Notes to Consolidated Financial Statements in the Annual Report. Mobile Gas and Willmut Gas also prepared their financial statements in accordance with U.S. GAAP provisions governing rate-regulated operations.

NEW ACCOUNTING STANDARDS

3 Months Ended

Mar. 31, 2017

Accounting Policies [Abstract]

New Accounting Standards

NEW ACCOUNTING STANDARDS

We describe below recent pronouncements that have had or may have a significant effect on our financial condition, results of operations, cash flows or disclosures.

Accounting Standards Update (ASU) 2014-09, “Revenue from Contracts with Customers,” ASU 2015-14, “Deferral of the Effective Date,” ASU 2016-08, “Principal versus Agent Considerations (Reporting Revenue Gross versus Net),” ASU 2016-10, “Identifying Performance Obligations and Licensing” and ASU 2016-12, “Narrow-Scope Improvements and Practical Expedients”: ASU 2014-09 provides accounting guidance for the recognition of revenue from contracts with customers and affects all entities that enter into contracts to provide goods or services to their customers. The guidance also provides a model for the measurement and recognition of gains and losses on the sale of certain nonfinancial assets, such as property and equipment, including real estate. This guidance must be adopted using either a full retrospective approach for all periods presented in the period of adoption or a modified retrospective approach. Amending ASU 2014-09, ASU 2016-08 clarifies the implementation guidance on principal versus agent considerations, ASU 2016-10 clarifies the determination of whether a good or service is separately identifiable from other promises and revenue recognition related to licenses of intellectual property, and ASU 2016-12 provides guidance on transition, collectability, noncash consideration, and the presentation of sales and other similar taxes.

ASU 2015-14 defers the effective date of ASU 2014-09 by one year for all entities and permits early adoption on a limited basis. For public entities, ASU 2014-09 is effective for fiscal years beginning after December 15, 2017, with early adoption permitted for fiscal years beginning after December 15, 2016, and is effective for interim periods in the year of adoption. We will adopt ASU 2014-09 on January 1, 2018 using the modified retrospective transition method and are currently evaluating the effect on our ongoing financial reporting. As part of our evaluation, we formed multiple working groups with oversight from a steering committee comprised of members from relevant Sempra Energy business units. We separated our various revenue streams into high-level categories, which served as the basis for accounting analysis and documentation of the impact of ASU 2014-09 on our revenue recognition. The majority of Sempra Energy’s revenues result from electric and natural gas service to Sempra Utilities’ customers. For such tariff-based revenues, Sempra Energy does not anticipate that the new standard will materially impact the amount and timing of such revenues. However, we continue to actively monitor outstanding issues currently being addressed by the American Institute of Certified Public

Accountants’ Revenue Recognition Working Group and the Financial Accounting Standards Board’s Transition Resource Group, since conclusions reached by these groups may impact our application of these ASUs.

ASU 2016-01, “Recognition and Measurement of Financial Assets and Financial Liabilities”: In addition to the presentation and disclosure requirements for financial instruments, ASU 2016-01 requires entities to measure equity investments, other than those accounted for under the equity method, at fair value and recognize changes in fair value in net income. Entities will no longer be able to use the cost method of accounting for equity securities. However, for equity investments without readily determinable fair values, entities may elect a measurement alternative that will allow those investments to be recorded at cost, less impairment, and adjusted for subsequent observable price changes. Upon adoption, entities must record a cumulative-effect adjustment to the balance sheet as of the beginning of the first reporting period in which the standard is adopted. The guidance on equity securities without readily determinable fair values will be applied prospectively to all equity investments that exist as of the date of adoption of the standard.

For public entities, ASU 2016-01 is effective for fiscal years beginning after December 15, 2017. We will adopt ASU 2016-01 on January 1, 2018 and do not expect it to materially affect our financial condition, results of operations or cash flows.

ASU 2016-02, “Leases”: ASU 2016-02 requires entities to include substantially all leases on the balance sheet by requiring the recognition of right-of-use assets and lease liabilities for all leases. Entities may elect to exclude from the balance sheet those leases with a maximum possible term of less than 12 months. For lessees, a lease is classified as finance or operating, and the asset and liability are initially measured at the present value of the lease payments. For lessors, accounting for leases is largely unchanged from previous provisions of U.S. GAAP, other than certain changes to align lessor accounting to specific changes made to lessee accounting and ASU 2014-09. ASU 2016-02 also requires new qualitative and quantitative disclosures for both lessees and lessors.

For public entities, ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, with early adoption permitted, and is effective for interim periods in the year of adoption. The standard requires lessees and lessors to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The modified retrospective approach includes optional practical expedients that may be elected, which would allow entities to continue to account for leases that commence before the effective date of the standard in accordance with previous U.S. GAAP unless the lease is modified, except for the lessee requirement to begin recognizing right-of-use assets and lease liabilities for all operating leases on the balance sheet at the reporting date. We are currently evaluating the effect of the standard on our ongoing financial reporting and have not yet selected the year in which we will adopt the standard. As part of our evaluation, we formed a steering committee comprised of members from relevant Sempra Energy business units and are compiling our population of contracts. Based on our assessment to date, we have determined that we will elect the practical expedients available under the transition guidance.

ASU 2016-09, “Improvements to Employee Share-Based Payment Accounting”: ASU 2016-09 is intended to simplify several aspects of the accounting for employee share-based payment transactions. Under ASU 2016-09, excess tax benefits and tax deficiencies are required to be recorded in earnings, and the requirement to reclassify excess tax benefits and deficiencies from operating to financing activities on the statement of cash flows has been eliminated. ASU 2016-09 also allows entities to withhold taxes up to the maximum individual statutory tax rate without resulting in liability classification of the award and clarifies that cash payments made to taxing authorities in connection with withheld shares should be classified as financing activities in the statement of cash flows.

We early adopted the provisions of ASU 2016-09 during the three months ended September 30, 2016, with an effective date of January 1, 2016. The following financial statement line items for the three months ended March 31, 2016 were affected by the change in accounting principle:



IMPACT FROM ADOPTION OF ASU 2016-09
(Dollars in millions, except per share amounts)
	Three months ended March 31, 2016
	As previously reported			Effect of adoption			As adjusted
Sempra Energy Consolidated:
Condensed Consolidated Statement of Operations:
Income tax expense	$	(142	)	$	34		$	(108	)
Net income	330			34			364
Earnings	319			34			353

Basic earnings per common share	$	1.28		$	0.13		$	1.41
Diluted earnings per common share	$	1.27		$	0.13		$	1.40
Weighted-average number of shares outstanding, diluted (thousands)	251,412			75			251,487

Condensed Consolidated Statement of Comprehensive Income (Loss):
Net income	$	330		$	34		$	364
Comprehensive income	315			34			349

Condensed Consolidated Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	330		$	34		$	364
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	112			(34		)	78
Other	2			34			36
Net cash provided by operating activities	592			34			626
Cash flows from financing activities:
Tax benefit related to share-based compensation	34			(34		)	—
Net cash provided by financing activities	364			(34		)	330
SDG&E:
Condensed Consolidated Statement of Operations:
Income tax expense	$	(72	)	$	7		$	(65	)
Net income	130			7			137
Earnings attributable to common shares	129			7			136

Condensed Consolidated Statement of Comprehensive Income (Loss):
Net income	$	130		$	7		$	137
Comprehensive income	128			7			135

Condensed Consolidated Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	130		$	7		$	137
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	20			(7		)	13
SoCalGas:
Condensed Statement of Operations:
Income tax expense	$	(87	)	$	4		$	(83	)
Net income	195			4			199

Condensed Statement of Comprehensive Income (Loss):
Net income/Comprehensive income	$	195		$	4		$	199

Condensed Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	195		$	4		$	199
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	59			(4		)	55

ASU 2016-13, “Measurement of Credit Losses on Financial Instruments”: ASU 2016-13 changes how entities will measure credit losses for most financial assets and certain other instruments. The standard introduces an “expected credit loss” impairment model that requires immediate recognition of estimated credit losses expected to occur over the remaining life of most financial assets measured at amortized cost, including trade and other receivables, loan commitments and financial guarantees. ASU 2016-13 also requires use of an allowance to record estimated credit losses on available-for-sale debt securities and expands disclosure requirements regarding an entity’s assumptions, models and methods for estimating the credit losses.

For public entities, ASU 2016-13 is effective for fiscal years beginning after December 15, 2019, with early adoption permitted for fiscal years beginning after December 15, 2018. We are currently evaluating the effect of the standard on our ongoing financial reporting and have not yet selected the year in which we will adopt the standard.

ASU 2016-15, “Classification of Certain Cash Receipts and Cash Payments”: ASU 2016-15 provides guidance on how certain cash receipts and cash payments are to be presented and classified in the statement of cash flows in order to reduce diversity in practice.

For public entities, ASU 2016-15 is effective for fiscal years beginning after December 15, 2017, with early adoption permitted, and is effective for interim periods in the year of adoption. An entity that elects early adoption must adopt all of the amendments in the same period. Entities must apply the guidance retrospectively to all periods presented, but may apply it prospectively if retrospective application would be impracticable. We are currently evaluating the effect of the standard on our statements of cash flows and plan to adopt the standard in the fourth quarter of 2017.

ASU 2016-18, “Restricted Cash”: ASU 2016-18 requires amounts described as restricted cash and restricted cash equivalents to be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. A reconciliation between the balance sheet and the statement of cash flows must be disclosed when the balance sheet includes more than one line item for cash, cash equivalents, restricted cash and restricted cash equivalents.

For public entities, ASU 2016-18 is effective for fiscal years beginning after December 15, 2017, and interim periods within those fiscal years, with early adoption permitted. We plan to adopt the standard in the fourth quarter of 2017. If we had adopted ASU 2016-18 in the first quarter of 2017, cash and cash equivalents at the beginning of the period would have included restricted cash of $76 million and $12 million, and cash and cash equivalents at the end of the period would have included restricted cash of $77 million and $13 million, in Sempra Energy’s and SDG&E’s statements of cash flows in the three months ended March 31, 2017, respectively.

ASU 2017-04, “Simplifying the Test for Goodwill Impairment”: ASU 2017-04 removes the second step of the goodwill impairment test, which requires a hypothetical purchase price allocation. An entity will be required to apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the carrying amount of goodwill. For public entities, ASU 2017-04 is effective for annual or interim goodwill impairment tests in fiscal years beginning after December 15, 2019, with early adoption permitted. The amendments should be applied on a prospective basis. We are currently evaluating the effect of the standard on our ongoing financial reporting and have not yet selected the year in which we will adopt the standard.

ASU 2017-05, “Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets”: ASU 2017-05 clarifies the scope of accounting for the derecognition or partial sale of nonfinancial assets to exclude all businesses and nonprofit activities. ASU 2017-05 also provides a definition for in-substance nonfinancial assets and additional guidance on partial sales of nonfinancial assets. For public entities, ASU 2017-05 is effective for annual reporting periods beginning after December 15, 2017, including interim periods within that reporting period, with early adoption permitted. An entity may elect to apply the amendments under a retrospective or modified retrospective approach. We are currently evaluating the effect of the standard on our ongoing financial reporting and will adopt it in conjunction with ASU 2014-09 on January 1, 2018, but have not yet selected the method of adoption.

ASU 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost”: ASU 2017-07 requires the service cost component of net periodic benefit costs to be presented in the same income statement line item as other employee compensation costs arising from services rendered during the period and the other components of net periodic benefit costs to be presented separately outside of operating income. The guidance also allows only the service cost component to be eligible for capitalization. For public entities, ASU 2017-07 is effective for annual reporting periods beginning after December 15, 2017, with early adoption permitted as of the beginning of an annual period for which financial statements have not been issued or made available for issuance. Amendments are to be applied retrospectively for presentation of costs and prospectively for capitalization of service costs. We are currently evaluating the effect of the standard on our ongoing financial reporting and have not yet selected the year in which we will adopt the standard.

The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6507316

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Direct Effects of a Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=66092750

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=64853466&loc=d3e22583-107794

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Indirect Effects of a Change in Accounting Principle
-URI http://asc.fasb.org/extlink&oid=6515603

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64853466&loc=d3e22580-107794

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.10-01.(b)(6))
-URI http://asc.fasb.org/extlink&oid=27015980&loc=d3e46468-122699

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Accounting Change
-URI http://asc.fasb.org/extlink&oid=6503790

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=64853466&loc=d3e22499-107794

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Glossary Retrospective Application
-URI http://asc.fasb.org/extlink&oid=6523989

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section 45
-Paragraph 13
-URI http://asc.fasb.org/extlink&oid=68064558&loc=d3e765-108305

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 270
-SubTopic 10
-Section 45
-Paragraph 12
-URI http://asc.fasb.org/extlink&oid=68064558&loc=d3e725-108305

ACQUISITION AND DIVESTITURE ACTIVITY

ACQUISITION AND DIVESTITURE ACTIVITY

3 Months Ended

Mar. 31, 2017

Business Combinations [Abstract]

We consolidate assets acquired and liabilities assumed as of the purchase date and include earnings from acquisitions in consolidated earnings after the purchase date. We did not complete any acquisitions during the three months ended March 31, 2017 or 2016. At March 31, 2017, the purchase price allocations for the acquisitions of Ventika, S.A.P.I. de C.V. and Ventika II, S.A.P.I. de C.V. in December 2016 and Gasoductos de Chihuahua S. de R.L. de C.V. in September 2016 were preliminary and subject to completion. Adjustments to the fair value estimates may occur as the process conducted for various valuations and assessments is finalized, primarily related to tax assets, liabilities and other attributes.

ASSETS HELD FOR SALE

We classify assets as held for sale when management approves and commits to a formal plan to actively market an asset for sale and we expect the sale to close within the next 12 months. Upon classifying an asset as held for sale, we record the asset at the lower of its carrying value or its estimated fair value reduced for selling costs.

Sempra Mexico

In February 2016, management approved a plan to market and sell Sempra Mexico’s Termoeléctrica de Mexicali (TdM), a 625-megawatt (MW) natural gas-fired power plant located in Mexicali, Baja California, Mexico. As a result, we stopped depreciating the plant and classified it as held for sale. We considered the estimated fair value of the plant, less costs to sell, and determined that no additional adjustments to carrying value are required at March 31, 2017. We are actively pursuing the sale of TdM, which we expect to be completed in the second half of 2017.

In connection with classifying TdM as held for sale, we recognized a $5 million income tax benefit and $29 million in income tax expense for the three months ended March 31, 2017 and 2016, respectively, for a deferred Mexican income tax liability related to the excess of carrying value over the tax basis. As the Mexican income tax on this basis difference is based on current carrying value, foreign exchange rates and inflation, such amount could change in future periods until the date of sale.

At March 31, 2017, the carrying amounts of the major classes of assets and related liabilities held for sale associated with TdM are as follows:



ASSETS HELD FOR SALE AT MARCH 31, 2017
(Dollars in millions)
	Termoeléctrica de Mexicali
Cash	$	1
Inventories	11
Other current assets	31
Deferred income taxes	9
Property, plant and equipment, net	120
Other noncurrent assets	24
Total assets held for sale	$	196

Accounts payable	$	6
Other current liabilities	4
Asset retirement obligations	4
Other noncurrent liabilities	26
Total liabilities held for sale	$	40

DIVESTITURE

Sempra LNG & Midstream

Investment in Rockies Express Pipeline LLC (Rockies Express)

In March 2016, Sempra LNG & Midstream entered into an agreement to sell its 25-percent interest in Rockies Express for cash consideration of $440 million, subject to adjustment at closing. The transaction closed in May 2016 for total cash proceeds of $443 million.

At the date of the agreement, the carrying value of Sempra LNG & Midstream’s investment in Rockies Express was $484 million. Following the execution of the agreement, Sempra LNG & Midstream measured the fair value of its equity method investment at $440 million, and recognized a $44 million ($27 million after-tax) impairment in Equity Earnings, Before Income Tax, on the Sempra Energy Condensed Consolidated Statement of Operations for the three months ended March 31, 2016. We discuss non-recurring fair value measures and the associated accounting impact on our investment in Rockies Express in Note 10 of the Notes to Consolidated Financial Statements in the Annual Report.

INVESTMENTS IN UNCONSOLIDATED ENTITIES	3 Months Ended
INVESTMENTS IN UNCONSOLIDATED ENTITIES	Mar. 31, 2017
Investments [Abstract]
Investments in Unconsolidated Entities	INVESTMENTS IN UNCONSOLIDATED ENTITIES Sempra Energy uses the equity method to account for investments in affiliated companies over which we have the ability to exercise significant influence, but not control. We provide additional information concerning our equity method investments in Note 3 above and in Notes 3 and 4 of the Notes to Consolidated Financial Statements in the Annual Report. SEMPRA SOUTH AMERICAN UTILITIES In February 2017, Sempra South American Utilities recorded the equitization of its $19 million note receivable due from Eletrans S.A., resulting in an increase in its investment in this unconsolidated joint venture. SEMPRA MEXICO Sempra Mexico invested cash of $46 million in its unconsolidated joint venture, Infraestructura Marina del Golfo, in the three months ended March 31, 2017. SEMPRA RENEWABLES Sempra Renewables invested cash of $15 million in its unconsolidated joint ventures in the three months ended March 31, 2016. SEMPRA LNG & MIDSTREAM Sempra LNG & Midstream capitalized $11 million and $12 million of interest in the three months ended March 31, 2017 and 2016, respectively, related to its investment in Cameron LNG Holdings, LLC (Cameron LNG JV), which has not commenced planned principal operations. During the three months ended March 31, 2017, Sempra LNG & Midstream invested cash of $1 million in this unconsolidated joint venture. GUARANTEES At March 31, 2017, we had outstanding guarantees aggregating a maximum of $4.4 billion with an aggregate carrying value of $48 million. We discuss these guarantees in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report.

OTHER FINANCIAL DATA

3 Months Ended

Mar. 31, 2017

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Other Financial Data

OTHER FINANCIAL DATAINVENTORIES

The components of inventories by segment are as follows:



INVENTORY BALANCES
(Dollars in millions)
	Natural gas				Liquefied natural gas				Materials and supplies				Total
	March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016
SDG&E	$	—	$	2	$	—	$	—	$	82	$	78	$	82	$	80
SoCalGas(1)	—		11		—		—		43		47		43		58
Sempra South American Utilities	—		—		—		—		28		27		28		27
Sempra Mexico	—		—		9		6		2		1		11		7
Sempra Renewables	—		—		—		—		4		4		4		4
Sempra LNG & Midstream	39		79		3		3		—		—		42		82
Sempra Energy Consolidated	$	39	$	92	$	12	$	9	$	159	$	157	$	210	$	258

(1)

At March 31, 2017 and December 31, 2016, SoCalGas’ natural gas inventory for core customers is net of an inventory loss related to the Aliso Canyon natural gas leak, which we discuss in Note 11.GREENHOUSE GAS (GHG) ALLOWANCES

The Condensed Consolidated Balance Sheets include the following amounts associated with GHG allowances and obligations.



GHG ALLOWANCES AND OBLIGATIONS
(Dollars in millions)
	Sempra Energy Consolidated				SDG&E				SoCalGas
	March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016
Assets:
Other current assets	$	40	$	40	$	16	$	16	$	24	$	24
Sundry	307		295		184		182		119		109
Total assets	$	347	$	335	$	200	$	198	$	143	$	133

Liabilities:
Other current liabilities	$	40	$	40	$	16	$	16	$	24	$	24
Deferred credits and other	183		171		80		72		99		96
Total liabilities	$	223	$	211	$	96	$	88	$	123	$	120

GOODWILLWe discuss goodwill in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report. The increase in goodwill from $2,364 million at December 31, 2016 to $2,380 million at March 31, 2017 is due to foreign currency translation at Sempra South American Utilities. We record the offset of this fluctuation in Other Comprehensive Income (Loss) (OCI).VARIABLE INTEREST ENTITIES

We consolidate a VIE if we are the primary beneficiary of the VIE. Our determination of whether we are the primary beneficiary is based on qualitative and quantitative analyses, which assess


▪	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.

SDG&E

SDG&E’s power procurement is subject to reliability requirements that may require SDG&E to enter into various power purchase arrangements which include variable interests. SDG&E evaluates the respective entities to determine if variable interests exist and, based on the qualitative and quantitative analyses described above, if SDG&E, and thereby Sempra Energy, is the primary beneficiary.

Tolling Agreements

SDG&E has agreements under which it purchases power generated by facilities for which it supplies all of the natural gas to fuel the power plant (i.e., tolling agreements). SDG&E’s obligation to absorb natural gas costs may be a significant variable interest. In addition, SDG&E has the power to direct the dispatch of electricity generated by these facilities. Based upon our analysis, the ability to direct the dispatch of electricity may have the most significant impact on the economic performance of the entity owning the generating facility because of the associated exposure to the cost of natural gas, which fuels the plants, and the value of electricity produced. To the extent that SDG&E (1) is obligated to purchase and provide fuel to operate the facility, (2) has the power to direct the dispatch, and (3) purchases all of the output from the facility for a substantial portion of the facility’s useful life, SDG&E may be the primary beneficiary of the entity owning the generating facility. SDG&E determines if it is the primary beneficiary in these cases based on a qualitative approach in which we consider the operational characteristics of the facility, including its expected power generation output relative to its capacity to generate and the financial structure of the entity, among other factors. If we determine that SDG&E is the primary beneficiary, SDG&E and Sempra Energy consolidate the entity that owns the facility as a VIE.

Otay Mesa VIE

SDG&E has an agreement to purchase power generated at the Otay Mesa Energy Center (OMEC), a 605-MW generating facility. In addition to tolling, the agreement provides SDG&E with the option to purchase OMEC at the end of the contract term in 2019, or upon earlier termination of the power purchase agreement, at a predetermined price subject to adjustments based on performance of the facility. If SDG&E does not exercise its option, under certain circumstances, it may be required to purchase the power plant for $280 million, which we refer to as the put option.

The facility owner, Otay Mesa Energy Center LLC (OMEC LLC), is a VIE (Otay Mesa VIE), of which SDG&E is the primary beneficiary. SDG&E has no OMEC LLC voting rights, holds no equity in OMEC LLC and does not operate OMEC. In addition to the risks absorbed under the tolling agreement, SDG&E absorbs separately through the put option a significant portion of the risk that the value of Otay Mesa VIE could decline. Accordingly, SDG&E and Sempra Energy consolidate Otay Mesa VIE. Otay Mesa VIE’s equity of $39 million at March 31, 2017 and $37 million at December 31, 2016 is included on the Condensed Consolidated Balance Sheets in Other Noncontrolling Interests for Sempra Energy and in Noncontrolling Interest for SDG&E.

OMEC LLC has a loan outstanding of $302 million at March 31, 2017, the proceeds of which were used for the construction of OMEC. The loan is with third party lenders and is collateralized by OMEC’s property, plant and equipment. SDG&E is not a party to the loan agreement and does not have any additional implicit or explicit financial responsibility to OMEC LLC. The loan fully matures in April 2019 and bears interest at rates varying with market rates. In addition, OMEC LLC has entered into interest rate swap agreements to moderate its exposure to interest rate changes. We provide additional information concerning the interest rate swaps in Note 7.

The Condensed Consolidated Statements of Operations of Sempra Energy and SDG&E include the following amounts associated with Otay Mesa VIE. The amounts are net of eliminations of transactions between SDG&E and Otay Mesa VIE. The captions in the table below correspond to SDG&E’s Condensed Consolidated Statements of Operations.



AMOUNTS ASSOCIATED WITH OTAY MESA VIE
(Dollars in millions)
	Three months ended March 31,
	2017			2016
Operating expenses
Cost of electric fuel and purchased power	$	(18	)	$	(17	)
Operation and maintenance	4			4
Depreciation and amortization	7			7
Total operating expenses	(7		)	(6		)
Operating income	7			6
Interest expense	(5		)	(5		)
Income before income taxes/Net income	2			1
Earnings attributable to noncontrolling interest	(2		)	(1		)
Earnings attributable to common shares	$	—		$	—

SDG&E has determined that no contracts, other than the one relating to Otay Mesa VIE mentioned above, result in SDG&E being the primary beneficiary of a variable interest entity at March 31, 2017. In addition to the tolling agreements described above, other variable interests involve various elements of fuel and power costs, and other components of cash flow expected to be paid to or received by our counterparties. In most of these cases, the expectation of variability is not substantial, and SDG&E generally does not have the power to direct activities that most significantly impact the economic performance of the other VIEs. If our ongoing evaluation of these VIEs were to conclude that SDG&E becomes the primary beneficiary and consolidation by SDG&E becomes necessary, the effects are not expected to significantly affect the financial position, results of operations, or liquidity of SDG&E. In addition, SDG&E is not exposed to losses or gains as a result of these other VIEs, because all such variability would be recovered in rates. We provide additional information about power purchase agreements with peaker plant facilities that are VIEs of which SDG&E is not the primary beneficiary in Note 11 below and in Note 15 of the Notes to Consolidated Financial Statements in the Annual Report.

We provide additional information regarding Otay Mesa VIE in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

Sempra Renewables

Effective December 2016, certain of Sempra Renewables’ wind and solar power generation projects are held by limited liability companies whose members are Sempra Renewables and financial institutions. The financial institutions are noncontrolling tax equity investors to which earnings, tax attributes and cash flows are allocated in accordance with the respective limited liability company agreements. These entities are VIEs and Sempra Energy is the primary beneficiary, generally due to Sempra Energy’s power to direct activities that most significantly impact the economic performance of these VIEs as the operator of the renewable energy projects.

As the primary beneficiary of these tax equity limited liability companies, we consolidate them. Sempra Energy’s Condensed Consolidated Balance Sheets include $918 million and $926 million of property, plant and equipment, net, and equity of $464 million and $468 million included in Other Noncontrolling Interests at March 31, 2017 and December 31, 2016, respectively, associated with these entities. Sempra Energy’s Condensed Consolidated Statement of Operations for the three months ended March 31, 2017 includes the following amounts associated with the tax equity limited liability companies. The amounts are net of eliminations of transactions between Sempra Energy and these entities.



AMOUNTS ASSOCIATED WITH TAX EQUITY ARRANGEMENTS
(Dollars in millions)
		Three months ended March 31, 2017
REVENUES
Energy-related businesses		$	13
EXPENSES
Operation and maintenance		(2		)
Depreciation and amortization		(8		)
Income before income taxes		3
Income tax expense		(2		)
Net income		1
Losses attributable to noncontrolling interests(1)		3
Earnings		$	4

(1)	Net income or loss attributable to the noncontrolling interests is computed using the hypothetical liquidation at book value (HLBV) method and is not based on ownership percentages.

We provide additional information regarding the tax equity limited liability companies in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

Sempra LNG & Midstream

Sempra Energy’s equity method investment in Cameron LNG JV is considered to be a VIE principally due to contractual provisions that transfer certain risks to customers. Sempra Energy is not the primary beneficiary because we do not have the power to direct the most significant activities of Cameron LNG JV. We will continue to evaluate Cameron LNG JV for any changes that may impact our determination of the primary beneficiary. The carrying value of our investment in Cameron LNG JV, including amounts recognized in Accumulated Other Comprehensive Income (Loss) (AOCI) related to interest-rate cash flow hedges at Cameron LNG JV, was $999 million at March 31, 2017 and $997 million at December 31, 2016. Our maximum exposure to loss includes the carrying value of our investment and the guarantees discussed in Note 4 above and in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report.

Other Variable Interest Entities

Sempra Energy’s other operating units also enter into arrangements which could include variable interests. We evaluate these arrangements and applicable entities based on the qualitative and quantitative analyses described above. Certain of these entities are service companies that are VIEs. As the primary beneficiary of these service companies, we consolidate them; however, their financial statements are not material to the financial statements of Sempra Energy. In all other cases, we have determined that these contracts are not variable interests in a VIE and therefore are not subject to the U.S. GAAP requirements concerning the consolidation of VIEs.PENSION AND OTHER POSTRETIREMENT BENEFITS

Net Periodic Benefit Cost

The following three tables provide the components of net periodic benefit cost:



NET PERIODIC BENEFIT COST – SEMPRA ENERGY CONSOLIDATED
(Dollars in millions)
	Pension benefits						Other postretirement benefits
	Three months ended March 31,
	2017			2016			2017			2016
Service cost	$	28		$	28		$	6		$	5
Interest cost	37			40			9			11
Expected return on assets	(40		)	(42		)	(16		)	(17		)
Amortization of:
Prior service cost	3			3			—			—
Actuarial loss (gain)	8			6			(1		)	—
Regulatory adjustment	(12		)	(28		)	2			2
Total net periodic benefit cost	$	24		$	7		$	—		$	1



NET PERIODIC BENEFIT COST – SDG&E
(Dollars in millions)
	Pension benefits						Other postretirement benefits
	Three months ended March 31,
	2017			2016			2017			2016
Service cost	$	8		$	7		$	1		$	1
Interest cost	9			10			2			2
Expected return on assets	(11		)	(12		)	(3		)	(3		)
Amortization of:
Prior service cost	—			—			1			1
Actuarial loss	2			3			—			—
Regulatory adjustment	(7		)	(7		)	(1		)	(1		)
Total net periodic benefit cost	$	1		$	1		$	—		$	—



NET PERIODIC BENEFIT COST – SOCALGAS
(Dollars in millions)
	Pension benefits						Other postretirement benefits
	Three months ended March 31,
	2017			2016			2017			2016
Service cost	$	18		$	17		$	4		$	4
Interest cost	24			25			7			8
Expected return on assets	(26		)	(25		)	(13		)	(14		)
Amortization of:
Prior service cost (credit)	2			2			(1		)	(1		)
Actuarial loss	4			3			—			—
Regulatory adjustment	(5		)	(21		)	3			3
Total net periodic benefit cost	$	17		$	1		$	—		$	—

Benefit Plan Contributions

The following table shows our year-to-date contributions to pension and other postretirement benefit plans and the amounts we expect to contribute in 2017:



BENEFIT PLAN CONTRIBUTIONS
(Dollars in millions)
	Sempra Energy Consolidated		SDG&E		SoCalGas
Contributions through March 31, 2017:
Pension plans	$	26	$	2	$	17
Other postretirement benefit plans	1		—		—
Total expected contributions in 2017:
Pension plans	$	181	$	38	$	90
Other postretirement benefit plans	8		4		1

RABBI TRUSTIn support of its Supplemental Executive Retirement, Cash Balance Restoration and Deferred Compensation Plans, Sempra Energy maintains dedicated assets, including a Rabbi Trust and investments in life insurance contracts, which totaled $412 million and $430 million at March 31, 2017 and December 31, 2016, respectively.EARNINGS PER SHARE (EPS)

The following table provides EPS computations for the three months ended March 31, 2017 and 2016. Basic EPS is calculated by dividing earnings attributable to common stock by the weighted-average number of common shares outstanding for the period. Diluted EPS includes the potential dilution of common stock equivalent shares that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.



EARNINGS PER SHARE COMPUTATIONS
(Dollars in millions, except per share amounts; shares in thousands)
	Three months ended March 31,
	2017		2016(1)
Numerator:
Earnings/Income attributable to common shares	$	441	$	353

Denominator:
Weighted-average common shares outstanding for basic EPS(2)	251,131		249,734
Dilutive effect of stock options, restricted stock awards and restricted stock units(3)	1,115		1,753
Weighted-average common shares outstanding for diluted EPS	252,246		251,487

Earnings per share:
Basic	$	1.76	$	1.41
Diluted	1.75		1.40


(1)	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.


(2)	Includes 600 and 555 average fully vested restricted stock units held in our Deferred Compensation Plan for the three months ended March 31, 2017 and 2016, 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.


(3)	Due to market fluctuations of both Sempra Energy stock and the comparative indices used to determine the vesting percentage of our total shareholder return performance-based restricted stock units, which we discuss in Note 8 of the Notes to Consolidated Financial Statements in the Annual Report, dilutive restricted stock units may vary widely from period-to-period.

The potentially dilutive impact from stock options, restricted stock awards (RSAs) and restricted stock units (RSUs) is calculated under the treasury stock method. Under this method, proceeds based on the exercise price and unearned compensation are assumed to be used to repurchase shares on the open market at the average market price for the period, reducing the number of potential new shares to be issued and sometimes causing an antidilutive effect. The computation of diluted EPS for the three months ended March 31, 2017 and 2016 excludes 6,801 and zero potentially dilutive shares, respectively, because to include them would be antidilutive for the period. However, these shares could potentially dilute basic EPS in the future.

Pursuant to our Sempra Energy share-based compensation plans, Sempra Energy’s Board of Directors granted 424,360 performance-based RSUs and 92,413 service-based RSUs during the three months ended March 31, 2017, primarily in January. During the three months ended March 31, 2017, IEnova granted 1,034,086 RSUs from the IEnova 2013 Long-Term Incentive Plan, under which awards are cash settled at vesting based on the price of IEnova common stock.

We discuss share-based compensation plans and related awards further in Note 8 of the Notes to Consolidated Financial Statements in the Annual Report.CAPITALIZED FINANCING COSTS

Capitalized financing costs include capitalized interest costs and AFUDC related to both debt and equity financing of construction projects. We capitalize interest costs incurred to finance capital projects and interest on equity method investments that have not commenced planned principal operations.

Interest capitalized and AFUDC are as follows:



CAPITALIZED FINANCING COSTS
(Dollars in millions)
	Three months ended March 31,
	2017		2016
Sempra Energy Consolidated	$	82	$	52
SDG&E	20		15
SoCalGas	15		13

COMPREHENSIVE INCOME

The following tables present the changes in AOCI by component and amounts reclassified out of AOCI to net income, excluding amounts attributable to noncontrolling interests:



CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1)
(Dollars in millions)
	Foreign currency translation adjustments			Financial instruments			Pension and other postretirement benefits			Total accumulated other comprehensive income (loss)
	Three months ended March 31, 2017 and 2016
Sempra Energy Consolidated:

Balance as of December 31, 2016	$	(527	)	$	(125	)	$	(96	)	$	(748	)
OCI before reclassifications	46			(2		)	—			44
Amounts reclassified from AOCI	—			6			2			8
Net OCI	46			4			2			52
Balance as of March 31, 2017	$	(481	)	$	(121	)	$	(94	)	$	(696	)

Balance as of December 31, 2015	$	(582	)	$	(137	)	$	(87	)	$	(806	)
OCI before reclassifications	68			(82		)	—			(14		)
Amounts reclassified from AOCI	—			(2		)	1			(1		)
Net OCI	68			(84		)	1			(15		)
Balance as of March 31, 2016	$	(514	)	$	(221	)	$	(86	)	$	(821	)
SDG&E:

Balance as of December 31, 2016 and March 31, 2017							$	(8	)	$	(8	)

Balance as of December 31, 2015 and March 31, 2016							$	(8	)	$	(8	)
SoCalGas:

Balance as of December 31, 2016 and March 31, 2017				$	(13	)	$	(9	)	$	(22	)

Balance as of December 31, 2015 and March 31, 2016				$	(14	)	$	(5	)	$	(19	)


(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 other comprehensive income (loss) components	Amounts reclassified from accumulated other comprehensive income (loss)						Affected line item on Condensed Consolidated Statements of Operations
	Three months ended March 31,
	2017			2016
Sempra Energy Consolidated:
Financial instruments:
Interest rate and foreign exchange instruments	$	(3	)	$	4		Interest Expense
Interest rate instruments	2			3			Equity Earnings (Losses), Before Income Tax
Interest rate and foreign exchange instruments	2			1			Equity (Losses) Earnings, Net of Income Tax
Foreign exchange instruments	2			—			Revenues: Energy-Related Businesses
Commodity contracts not subject to rate recovery	9			(7		)	Revenues: Energy-Related Businesses
Total before income tax	12			1
	(4		)	—			Income Tax Expense
Net of income tax	8			1
	(2		)	(3		)	Earnings Attributable to Noncontrolling Interests
	$	6		$	(2	)
Pension and other postretirement benefits:
Amortization of actuarial loss	$	3		$	2		See note (1) below
	(1		)	(1		)	Income Tax Expense
Net of income tax	$	2		$	1

Total reclassifications for the period, net of tax	$	8		$	(1	)
SDG&E:
Financial instruments:
Interest rate instruments	$	3		$	3		Interest Expense
	(3		)	(3		)	Earnings Attributable to Noncontrolling Interest
Total reclassifications for the period	$	—		$	—


(1)	Amounts are included in the computation of net periodic benefit cost (see “Pension and Other Postretirement Benefits” above).

For the three months ended March 31, 2017 and 2016, reclassifications out of AOCI to net income were negligible for SoCalGas.SHAREHOLDERS’ EQUITY AND NONCONTROLLING INTERESTS

The following tables provide reconciliations of changes in Sempra Energy’s, SDG&E’s and SoCalGas’ shareholders’ equity and noncontrolling interests for the three months ended March 31, 2017 and 2016.



SHAREHOLDERS’ EQUITY AND NONCONTROLLING INTERESTS – SEMPRA ENERGY CONSOLIDATED
(Dollars in millions)
	Sempra Energy shareholders’ equity(1)			Non- controlling interests(2)			Total equity(1)
Balance at December 31, 2016	$	12,951		$	2,290		$	15,241
Comprehensive income	493			22			515
Share-based compensation expense	10			—			10
Common stock dividends declared	(206		)	—			(206		)
Issuances of common stock	30			—			30
Repurchases of common stock	(14		)	—			(14		)
Distributions to noncontrolling interests	—			(7		)	(7		)
Balance at March 31, 2017	$	13,264		$	2,305		$	15,569
Balance at December 31, 2015	$	11,809		$	770		$	12,579
Cumulative-effect adjustment from change in accounting principle	107			—			107
Comprehensive income	338			11			349
Share-based compensation expense	13			—			13
Common stock dividends declared	(188		)	—			(188		)
Issuances of common stock	28			—			28
Repurchases of common stock	(54		)	—			(54		)
Distributions to noncontrolling interests	—			(3		)	(3		)
Balance at March 31, 2016	$	12,053		$	778		$	12,831


(1)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.


(2)	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 shareholder’s equity(1)			Non- controlling interest			Total equity(1)
Balance at December 31, 2016	$	5,641		$	37		$	5,678
Comprehensive income	155			5			160
Common stock dividends declared	(175		)	—			(175		)
Distributions to noncontrolling interest	—			(3		)	(3		)
Balance at March 31, 2017	$	5,621		$	39		$	5,660
Balance at December 31, 2015	$	5,223		$	53		$	5,276
Cumulative-effect adjustment from change in accounting principle	23			—			23
Comprehensive income (loss)	136			(1		)	135
Distributions to noncontrolling interest	—			(1		)	(1		)
Balance at March 31, 2016	$	5,382		$	51		$	5,433


(1)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.



SHAREHOLDERS’ EQUITY – SOCALGAS
(Dollars in millions)
	Total equity(1)
Balance at December 31, 2016	$	3,510
Comprehensive income	203
Balance at March 31, 2017	$	3,713
Balance at December 31, 2015	$	3,149
Cumulative-effect adjustment from change in accounting principle	15
Comprehensive income	199
Balance at March 31, 2016	$	3,363


(1)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.

Ownership interests that are held by owners other than Sempra Energy and SDG&E in subsidiaries or entities consolidated by them are accounted for and reported as noncontrolling interests. As a result, noncontrolling interests are reported as a separate component of equity on the Condensed Consolidated Balance Sheets. Earnings or losses attributable to noncontrolling interests are separately identified on the Condensed Consolidated Statements of Operations, and comprehensive income or loss attributable to noncontrolling interests is separately identified on the Condensed Consolidated Statements of Comprehensive Income (Loss).

Preferred Stock

The preferred stock at SoCalGas is presented at Sempra Energy as a noncontrolling interest. Sempra Energy records charges against income related to noncontrolling interests for preferred stock dividends declared by SoCalGas. We provide additional information regarding preferred stock in Note 11 of the Notes to Consolidated Financial Statements in the Annual Report.

Other Noncontrolling Interests

At March 31, 2017 and December 31, 2016, we reported the following noncontrolling ownership interests held by others (not including preferred shareholders) recorded in Other Noncontrolling Interests in Total Equity on Sempra Energy’s Condensed Consolidated Balance Sheets:



OTHER NONCONTROLLING INTERESTS
(Dollars in millions)
	Percent ownership held by noncontrolling interests				Equity held by noncontrolling interests
	March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016
SDG&E:
Otay Mesa VIE	100	%	100	%	$	39	$	37
Sempra South American Utilities:
Chilquinta Energía subsidiaries(1)	22.9 – 43.4		23.1 – 43.4		23		22
Luz del Sur	16.4		16.4		182		173
Tecsur	9.8		9.8		4		4
Sempra Mexico:
IEnova	33.6		33.6		1,531		1,524
Sempra Renewables:
Tax equity arrangement – wind(2)	NA		NA		93		92
Tax equity arrangement – solar(2)	NA		NA		371		376
Sempra LNG & Midstream:
Bay Gas Storage Company, Ltd.	9.1		9.1		27		27
Liberty Gas Storage, LLC	23.3		23.3		14		14
Southern Gas Transmission Company	49.0		49.0		1		1
Total Sempra Energy					$	2,285	$	2,270


(1)	Chilquinta Energía has four subsidiaries with noncontrolling interests held by others. Percentage range reflects the highest and lowest ownership percentages among these subsidiaries.

(2)

Net income or loss attributable to the noncontrolling interests is computed using the HLBV method and is not based on ownership percentages, as we discuss in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.TRANSACTIONS WITH AFFILIATES

Amounts due from and to unconsolidated affiliates at Sempra Energy Consolidated, SDG&E and SoCalGas are as follows:



AMOUNTS DUE FROM (TO) UNCONSOLIDATED AFFILIATES
(Dollars in millions)
	March 31, 2017			December 31, 2016
Sempra Energy Consolidated:
Total due from various unconsolidated affiliates – current	$	24		$	26

Sempra South American Utilities(1):
Eletrans S.A. and Eletrans II S.A. – 4% Note(2)	$	82		$	96
Other related party receivables	1			1
Sempra Mexico(1):
Affiliate of joint venture with Ductos y Energéticos del Norte:
Note due November 14, 2018(3)	2			2
Note due November 14, 2018(3)	44			44
Note due November 14, 2018(3)	36			35
Note due November 14, 2018(3)	9			9
Energía Sierra Juárez – Note(4)	13			14
Total due from unconsolidated affiliates – noncurrent	$	187		$	201

Total due to various unconsolidated affiliates – current	$	(13	)	$	(11	)
SDG&E:
Sempra Energy(5)	$	—		$	3
Various affiliates	—			1
Total due from various unconsolidated affiliates – current	$	—		$	4

Sempra Energy	$	(28	)	$	—
SoCalGas	(9		)	(8		)
Various affiliates	(8		)	(7		)
Total due to various unconsolidated affiliates – current	$	(45	)	$	(15	)

Income taxes due from Sempra Energy(6)	$	109		$	159
SoCalGas:
Sempra Energy(7)	$	7		$	—
SDG&E	9			8
Total due from unconsolidated affiliates – current	$	16		$	8

Sempra Energy	$	—		$	(28	)
Total due to unconsolidated affiliates – current	$	—		$	(28	)

Income taxes due (to) from Sempra Energy(6)	$	(13	)	$	5


(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. and Eletrans II S.A. (collectively, Eletrans), which is a joint venture of Chilquinta Energía.


(3)	U.S. dollar-denominated loan, at a variable interest rate based on the 30-day LIBOR plus 450 basis points (5.48 percent at March 31, 2017), to finance the Los Ramones Norte pipeline.


(4)	U.S. dollar-denominated loan, at a variable interest rate based on the 30-day LIBOR plus 637.5 basis points (7.36 percent at March 31, 2017) with no stated maturity date, to finance the first phase of the Energía Sierra Juárez wind project, which is a joint venture of IEnova.


(5)	At December 31, 2016, net receivable included outstanding advances to Sempra Energy of $31 million at an interest rate of 0.68 percent.


(6)	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.


(7)	At March 31, 2017, net receivable included outstanding advances to Sempra Energy of $35 million at an interest rate of 0.95 percent.

Revenues and cost of sales from unconsolidated affiliates are as follows:



REVENUES AND COST OF SALES FROM UNCONSOLIDATED AFFILIATES
(Dollars in millions)
	Three months ended March 31,
	2017		2016
Revenues:
Sempra Energy Consolidated	$	7	$	5
SDG&E	2		3
SoCalGas	18		17
Cost of Sales:
Sempra Energy Consolidated	$	14	$	30
SDG&E	20		14

Guarantees

Sempra Energy has provided guarantees to certain of its solar and wind farm joint ventures and entered into guarantees related to the financing of the Cameron LNG JV project, as we discuss in Note 4 above and in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report.OTHER INCOME, NET

Other Income, Net on the Condensed Consolidated Statements of Operations consists of the following:



OTHER INCOME, NET
(Dollars in millions)
	Three months ended March 31,
	2017		2016
Sempra Energy Consolidated:
Allowance for equity funds used during construction	$	72	$	27
Investment gains(1)	16		10
Gains on interest rate and foreign exchange instruments, net	63		3
Foreign currency transaction gains (losses)	10		(2		)
Sale of other investments	—		1
Electrical infrastructure relocation income(2)	—		1
Regulatory interest, net(3)	2		2
Sundry, net	6		7
Total	$	169	$	49
SDG&E:
Allowance for equity funds used during construction	$	15	$	11
Regulatory interest, net(3)	2		2
Sundry, net	1		1
Total	$	18	$	14
SoCalGas:
Allowance for equity funds used during construction	$	11	$	10
Total	$	11	$	10


(1)	Represents investment 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, recorded in Operation and Maintenance on the Condensed Consolidated Statements of Operations.


(2)	Income at Luz del Sur associated with the relocation of electrical infrastructure.

(3)

Interest on regulatory balancing accounts.INCOME TAXES



INCOME TAX EXPENSE AND EFFECTIVE INCOME TAX RATES
(Dollars in millions)
	Income tax expense		Effective income tax rate		Income tax expense		Effective income tax rate
	Three months ended March 31,
	2017				2016(1)
Sempra Energy Consolidated	$	295	39	%	$	108	24	%
SDG&E	90		36		65		32
SoCalGas	98		33		83		29


(1)	Reflects the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.

Sempra Energy, SDG&E and SoCalGas record income taxes for interim periods utilizing a forecasted effective tax rate anticipated for the full year, as required by U.S. GAAP. The income tax effect of items that can be reliably forecasted is factored into the forecasted effective tax rate, and the impact is recognized proportionately over the year. Items that cannot be reliably forecasted (e.g., foreign currency translation and inflation adjustments, remeasurement of deferred tax asset valuation allowances, income tax expense or benefit associated with the gain or loss on sale or impairment of a book investment, resolution of prior years’ income tax items, and certain impacts of regulatory matters) are recorded in the interim period in which they actually occur, which can result in variability in the effective income tax rate.

Sempra Energy’s income tax expense for the three months ended March 31, 2017 and 2016 includes deferred income tax related to Sempra Mexico’s power plant held for sale, as we discuss in Note 3.

For SDG&E and SoCalGas, the California Public Utilities Commission (CPUC) requires flow-through rate-making treatment for the current income tax benefit or expense arising from certain property-related and other temporary differences between the treatment for financial reporting and income tax, which will reverse over time. Under the regulatory accounting treatment required for these flo

w-through temporary differences, deferred income tax assets and liabilities are not recorded to deferred income tax expense, but rather to a regulatory asset or liability, which impacts the current effective income tax rate. As a result, changes in the relative size of these items compared to pretax income, from period to period, can cause variations in the effective income tax rate. The following items are subject to flow-through treatment:


▪	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 AFUDC related to equity recorded for regulated construction projects at Sempra Mexico has similar flow-through treatment.

As we discuss in Note 10 below and in Notes 6 and 14 of the Notes to Consolidated Financial Statements in the Annual Report, the final decision in the 2016 General Rate Case (2016 GRC FD) was issued by the CPUC in June 2016 and required SDG&E and SoCalGas to each establish a two-way income tax expense memorandum account to track any revenue variances resulting from certain differences arising between the income tax expense forecasted in the 2016 GRC and the income tax expense incurred from 2016 through 2018. The tracking accounts will remain open until the CPUC decides to close them. We expect that certain amounts recorded in the tracking accounts may give rise to regulatory assets or liabilities.

We provide additional information about our accounting for income taxes in Notes 1 and 6 of the Notes to Consolidated Financial Statements in the Annual Report.

DEBT AND CREDIT FACILITIES

3 Months Ended

Mar. 31, 2017

Debt Disclosure [Abstract]

Debt and Credit Facilities

DEBT AND CREDIT FACILITIES

LINES OF CREDIT

At March 31, 2017, Sempra Energy Consolidated had an aggregate of $4.3 billion in three primary committed lines of credit for Sempra Energy, Sempra Global and the California Utilities to provide liquidity and to support commercial paper. The principal terms of these committed lines of credit, which expire in October 2020, are described below and in Note 5 of the Notes to Consolidated Financial Statements in the Annual Report. Available unused credit on these lines at March 31, 2017 was approximately $2.7 billion. Our foreign operations have additional general purpose credit facilities aggregating $1.7 billion at March 31, 2017. Available unused credit on these lines totaled $1 billion at March 31, 2017.



PRIMARY U.S. COMMITTED LINES OF CREDIT
(Dollars in millions)
		At March 31, 2017
		Total facility			Commercial paper outstanding			Adjustment for combined limit			Letters of credit outstanding			Available unused credit
Sempra Energy(1)		$	1,000		$	—		$	—		$	(65	)	$	935
Sempra Global(2)		2,335			(1,197		)	—			—			1,138
California Utilities(3):
	SDG&E	750			(343		)	—			—			407
	SoCalGas	750			—			(93		)	—			657
	Less: combined limit of $1 billion for both utilities	(500		)	—			93			—			(407		)
		1,000			(343		)	—			—			657
Total		$	4,335		$	(1,540	)	$	—		$	(65	)	$	2,730

(1) The facility also provides for issuance of up to $400 million of letters of credit on behalf of Sempra Energy with the amount of borrowings

otherwise available under the facility reduced by the amount of outstanding letters of credit.

(2) Sempra Energy guarantees Sempra Global’s obligations under the credit facility.

(3) The facility also provides for the issuance of letters of credit on behalf of each utility subject to a combined letter of credit commitment of $250 million for both utilities. The amount of borrowings otherwise available under the facility is reduced by the amount of outstanding letters of credit.

Sempra Energy, SDG&E and SoCalGas must maintain a ratio of indebtedness to total capitalization (as defined in each agreement) of no more than 65 percent at the end of each quarter. Each entity is in compliance with this and all other financial covenants under its respective credit facility at March 31, 2017.



CREDIT FACILITIES IN SOUTH AMERICA AND MEXICO
(U.S. dollar equivalent in millions)
			At March 31, 2017
		Denominated in	Total facility		Amount outstanding				Available unused credit
Sempra South American Utilities(1):
	Peru(2)	Peruvian sol	$	392	$	(155	)	(3)	$	237
	Chile	Chilean peso	115		—				115
Sempra Mexico:
	IEnova(4)	U.S. dollar	1,170		(446		)		724
Total			$	1,677	$	(601	)		$	1,076

(1) The credit facilities were entered into to finance working capital and for general corporate purposes and expire between 2017 and 2020.

(2) The Peruvian facilities require a debt to equity ratio of no more than 170 percent, with which we were in compliance at March 31, 2017.

(3) Includes bank guarantees of $12 million.

(4) Five-year revolver expiring in August 2020 with a syndicate of eight lenders.

WEIGHTED AVERAGE INTEREST RATES

The weighted average interest rates on total short-term debt at Sempra Energy Consolidated were 1.6 percent and 1.51 percent at March 31, 2017 and December 31, 2016, respectively. The weighted average interest rate on total short-term debt at SDG&E was 1.0 percent at March 31, 2017. At December 31, 2016, the weighted average interest rate on total short-term debt at SoCalGas was 0.75 percent.

LONG-TERM DEBT

Sempra South American Utilities

In February 2017, Luz del Sur publicly offered and sold $50 million of corporate bonds at 6.38 percent, maturing in 2023.

INTEREST RATE SWAPS

We discuss our fair value interest rate swaps and interest rate swaps to hedge cash flows in Note 7.

DERIVATIVE FINANCIAL INSTRUMENTS

3 Months Ended

Mar. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

DERIVATIVE FINANCIAL INSTRUMENTS

We use derivative instruments primarily to manage exposures arising in the normal course of business. Our principal exposures are commodity market risk, benchmark interest rate risk and foreign exchange rate exposures. Our use of derivatives for these risks is integrated into the economic management of our anticipated revenues, anticipated expenses, assets and liabilities. Derivatives may be effective in mitigating these risks (1) that could lead to declines in anticipated revenues or increases in anticipated expenses, or (2) that our asset values may fall or our liabilities increase. Accordingly, our derivative activity summarized below generally represents an impact that is intended to offset associated revenues, expenses, assets or liabilities that are not included in the tables below.

In certain cases, we apply the normal purchase or sale exception to derivative instruments and have other commodity contracts that are not derivatives. These contracts are not recorded at fair value and are therefore excluded from the disclosures below.

In all other cases, we record derivatives at fair value on the Condensed Consolidated Balance Sheets. We designate each derivative as (1) a cash flow hedge, (2) a fair value hedge, or (3) undesignated. Depending on the applicability of hedge accounting and, for the California Utilities and other operations subject to regulatory accounting, the requirement to pass impacts through to customers, the impact of derivative instruments may be offset in other comprehensive income (loss) (cash flow hedge), on the balance sheet (fair value hedges and regulatory offsets), or recognized in earnings. We classify cash flows from the settlements of derivative instruments as operating activities on the Condensed Consolidated Statements of Cash Flows.

HEDGE ACCOUNTING

We may designate a derivative as a cash flow hedging instrument if it effectively converts anticipated cash flows associated with revenues or expenses to a fixed dollar amount. We may utilize cash flow hedge accounting for derivative commodity instruments, foreign currency instruments and interest rate instruments. Designating cash flow hedges is dependent on the business context in which the instrument is being used, the effectiveness of the instrument in offsetting the risk that the future cash flows of a given revenue or expense item may vary, and other criteria.

We may designate an interest rate derivative as a fair value hedging instrument if it effectively converts our own debt from a fixed interest rate to a variable rate. The combination of the derivative and debt instrument results in fixing that portion of the fair value of the debt that is related to benchmark interest rates. Designating fair value hedges is dependent on the instrument being used, the effectiveness of the instrument in offsetting changes in the fair value of our debt instruments, and other criteria.

ENERGY DERIVATIVES

Our market risk is primarily related to natural gas and electricity price volatility and the specific physical locations where we transact. We use energy derivatives to manage these risks. The use of energy derivatives in our various businesses depends on the particular energy market, and the operating and regulatory environments applicable to the business, as follows:

▪

The California Utilities use natural gas and electricity derivatives, for the benefit of customers, with the objective of managing price risk and basis risks, and stabilizing 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, which are recoverable in rates, are recorded in Cost of Electric Fuel and Purchased Power on the Condensed Consolidated Statements of Operations.

▪

Sempra Mexico, Sempra LNG & Midstream, and Sempra Renewables 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 and storage, and power generation. 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.

We summarize net energy derivative volumes at March 31, 2017 and December 31, 2016 as follows:



NET ENERGY DERIVATIVE VOLUMES
(Quantities in millions)
Commodity	Unit of measure	March 31, 2017	December 31, 2016
California Utilities:
SDG&E:
Natural gas	MMBtu(1)	44	48
Electricity	MWh(2)	4	4
Congestion revenue rights	MWh	45	48
SoCalGas – natural gas	MMBtu	—	1

Energy-Related Businesses:
Sempra LNG & Midstream – natural gas	MMBtu	16	31


(1)	Million British thermal units


(2)	Megawatt hours

In addition to the amounts noted above, we frequently use commodity derivatives to manage risks associated with the physical locations of contractual obligations and assets, such as natural gas purchases and sales.

INTEREST RATE DERIVATIVES

We are exposed to interest rates primarily as a result of our current and expected use of financing. The California Utilities, as well as other Sempra Energy subsidiaries and joint ventures, periodically enter into interest rate derivative agreements intended to moderate our exposure to interest rates and to lower our overall costs of borrowing. We may utilize interest rate swaps typically designated as fair value hedges, as a means to achieve our targeted level of variable rate debt as a percent of total debt. In addition, we may utilize interest rate swaps, typically designated as cash flow hedges, to lock in interest rates on outstanding debt or in anticipation of future financings. Separately, Otay Mesa VIE has entered into interest rate swap agreements, designated as cash flow hedges, to moderate its exposure to interest rate changes.

At March 31, 2017 and December 31, 2016, the net notional amounts of our interest rate derivatives, excluding joint ventures, were:



INTEREST RATE DERIVATIVES
(Dollars in millions)
	March 31, 2017			December 31, 2016
	Notional debt		Maturities	Notional debt		Maturities
Sempra Energy Consolidated:
Cash flow hedges(1)	$	910	2017-2032	$	924	2017-2032
SDG&E:
Cash flow hedges(1)	302		2017-2019	305		2017-2019


(1)	Includes Otay Mesa VIE. All of SDG&E’s interest rate derivatives relate to Otay Mesa VIE.

FOREIGN CURRENCY DERIVATIVES

We utilize cross-currency swaps to hedge exposure related to Mexican peso-denominated debt at our Mexican subsidiaries and joint ventures. These cash flow hedges exchange our Mexican-peso denominated principal and interest payments into the U.S. dollar and swap Mexican variable interest rates for U.S. fixed interest rates. From time to time, Sempra Mexico and its joint ventures may use other foreign currency derivatives to hedge exposures related to cash flows associated with revenues from contracts denominated in Mexican pesos that are indexed to the U.S. dollar.

We are also exposed to exchange rate movements at our Mexican subsidiaries and joint ventures, which have U.S. dollar denominated cash balances, receivables, payables and debt (monetary assets and liabilities) that give rise to Mexican currency exchange rate movements for Mexican income tax purposes. They also have deferred income tax assets and liabilities denominated in the Mexican peso, which must be translated to U.S. dollars for financial reporting purposes. In addition, monetary assets and liabilities and certain nonmonetary assets and liabilities are adjusted for Mexican inflation for Mexican income tax purposes. We utilize foreign currency derivatives as a means to manage the risk of exposure to significant fluctuations in our income tax expense and equity earnings from these impacts, however we generally do not hedge our deferred income tax assets and liabilities.

In addition, Sempra South American Utilities and its joint ventures use foreign currency derivatives to manage foreign currency rate risk. We discuss these derivatives at Chilquinta Energía’s Eletrans joint venture investment in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report.

At March 31, 2017 and December 31, 2016, the net notional amounts of our foreign currency derivatives, excluding joint ventures, were:



FOREIGN CURRENCY DERIVATIVES
(Dollars in millions)
	March 31, 2017			December 31, 2016
	Notional amount		Maturities	Notional amount		Maturities
Sempra Energy Consolidated:
Cross-currency swaps	$	408	2017-2023	$	408	2017-2023
Other foreign currency derivatives(1)	922		2017-2018	86		2017-2018


(1)	In the three months ended March 31, 2017, we entered into foreign currency derivatives with notional amounts totaling $850 million that expire in December 2017.

FINANCIAL STATEMENT PRESENTATION

The Condensed Consolidated Balance Sheets reflect the offsetting of net derivative positions and cash collateral with the same counterparty when a legal right of offset exists. The following tables provide the fair values of derivative instruments on the Condensed Consolidated Balance Sheets at March 31, 2017 and December 31, 2016, including the amount of cash collateral receivables that were not offset, as the cash collateral is in excess of liability positions.



DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
	March 31, 2017
	Current assets: Fixed-price contracts and other derivatives(1)			Other assets: Sundry			Current liabilities: Fixed-price contracts and other derivatives(2)			Deferred credits and other liabilities: Fixed-price contracts and other derivatives
Sempra Energy Consolidated:
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments(3)	$	—		$	1		$	(56	)	$	(155	)
Derivatives not designated as hedging instruments:
Foreign exchange instruments	98			—			—			—
Commodity contracts not subject to rate recovery	67			31			(60		)	(21		)
Associated offsetting commodity contracts	(54		)	(21		)	54			21
Commodity contracts subject to rate recovery	25			71			(60		)	(163		)
Associated offsetting commodity contracts	(4		)	—			4			—
Associated offsetting cash collateral	—			—			9			15
Net amounts presented on the balance sheet	132			82			(109		)	(303		)
Additional cash collateral for commodity contracts not subject to rate recovery	9			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	20			—			—			—
Total(4)	$	161		$	82		$	(109	)	$	(303	)
SDG&E:
Derivatives designated as hedging instruments:
Interest rate instruments(3)	$	—		$	—		$	(13	)	$	(9	)
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	23			71			(59		)	(163		)
Associated offsetting commodity contracts	(4		)	—			4			—
Associated offsetting cash collateral	—			—			9			15
Net amounts presented on the balance sheet	19			71			(59		)	(157		)
Additional cash collateral for commodity contracts not subject to rate recovery	1			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	19			—			—			—
Total(4)	$	39		$	71		$	(59	)	$	(157	)
SoCalGas:
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	$	2		$	—		$	(1	)	$	—
Net amounts presented on the balance sheet	2			—			(1		)	—
Additional cash collateral for commodity contracts subject to rate recovery	1			—			—			—
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.



DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
	December 31, 2016
	Current assets: Fixed-price contracts and other derivatives(1)			Other assets: Sundry			Current liabilities: Fixed-price contracts and other derivatives(2)			Deferred credits and other liabilities: Fixed-price contracts and other derivatives
Sempra Energy Consolidated:
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments(3)	$	7		$	2		$	(24	)	$	(228	)
Commodity contracts not subject to rate recovery	—			—			(14		)	—
Derivatives not designated as hedging instruments:
Commodity contracts not subject to rate recovery	248			36			(254		)	(28		)
Associated offsetting commodity contracts	(242		)	(27		)	242			27
Associated offsetting cash collateral	—			(1		)	16			1
Commodity contracts subject to rate recovery	37			73			(57		)	(150		)
Associated offsetting commodity contracts	(9		)	(1		)	9			1
Associated offsetting cash collateral	—			—			5			13
Net amounts presented on the balance sheet	41			82			(77		)	(364		)
Additional cash collateral for commodity contracts not subject to rate recovery	10			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	32			—			—			—
Total(4)	$	83		$	82		$	(77	)	$	(364	)
SDG&E:
Derivatives designated as hedging instruments:
Interest rate instruments(3)	$	—		$	—		$	(13	)	$	(12	)
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	33			73			(51		)	(150		)
Associated offsetting commodity contracts	(6		)	(1		)	6			1
Associated offsetting cash collateral	—			—			3			13
Net amounts presented on the balance sheet	27			72			(55		)	(148		)
Additional cash collateral for commodity contracts not subject to rate recovery	1			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	30			—			—			—
Total(4)	$	58		$	72		$	(55	)	$	(148	)
SoCalGas:
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	$	4		$	—		$	(6	)	$	—
Associated offsetting commodity contracts	(3		)	—			3			—
Associated offsetting cash collateral	—			—			2			—
Net amounts presented on the balance sheet	1			—			(1		)	—
Additional cash collateral for commodity contracts not subject to rate recovery	1			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	2			—			—			—
Total	$	4		$	—		$	(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.

The table below includes the effects of derivative instruments designated as fair value hedges on the Condensed Consolidated Statement of Operations for the three months ended March 31, 2016. There were no fair value hedges outstanding during the three months ended March 31, 2017.



FAIR VALUE HEDGE IMPACTS
(Dollars in millions)
			Pretax gain on derivatives recognized in earnings
			Three months ended
		Location	March 31, 2016
Sempra Energy Consolidated:
Interest rate instruments(1)		Interest Expense	$	2

(1)	There was no hedge ineffectiveness in the three months ended March 31, 2016. 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 recorded in Other Income, Net.

The table below includes the effects of derivative instruments designated as cash flow hedges on the Condensed Consolidated Statements of Operations and in OCI and AOCI for the three months ended March 31:



CASH FLOW HEDGE IMPACTS
(Dollars in millions)
	Pretax gain (loss) recognized in OCI							Pretax gain (loss) reclassified from AOCI into earnings
	Three months ended March 31,							Three months ended March 31,
	2017			2016			Location	2017			2016
Sempra Energy Consolidated:
Interest rate and foreign exchange instruments(1)	$	16		$	(11	)	Interest Expense	$	3		$	(4	)
Interest rate instruments	(5		)	(137		)	Equity Earnings (Losses), Before Income Tax	(2		)	(3		)
Interest rate and foreign exchange instruments	(9		)	(18		)	Equity (Losses) Earnings, Net of Income Tax	(2		)	(1		)
Foreign exchange instruments	(9		)	—			Revenues: Energy- Related Businesses	(2		)	—
Commodity contracts not subject to rate recovery	3			1			Revenues: Energy- Related Businesses	(9		)	7
Total(2)	$	(4	)	$	(165	)		$	(12	)	$	(1	)
SDG&E:
Interest rate instruments(1)(2)	$	—		$	(5	)	Interest Expense	$	(3	)	$	(3	)


(1)	Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE.


(2)	There was negligible hedge ineffectiveness related to these cash flow hedges in the three months ended March 31, 2017 and 2016.

For Sempra Energy Consolidated, we expect that net gains of $12 million, which are net of income tax expense, that are currently recorded in AOCI (including $11 million of losses in noncontrolling interests related to Otay Mesa VIE at SDG&E) related to cash flow hedges will be reclassified into earnings during the next twelve months as the hedged items affect earnings. SoCalGas expects that negligible losses, net of income tax benefit, that are currently recorded in AOCI related to cash flow hedges will be reclassified into earnings during the next twelve months as the hedged items affect earnings. Actual amounts ultimately reclassified into earnings depend on the interest rates in effect when derivative contracts mature.

For all forecasted transactions, the maximum remaining term over which we are hedging exposure to the variability of cash flows at March 31, 2017 is approximately 15 years and 2 years for Sempra Energy Consolidated and SDG&E, respectively. The maximum remaining term for which we are hedging exposure to the variability of cash flows at our equity method investees is 18 years.

The effects of derivative instruments not designated as hedging instruments on the Condensed Consolidated Statements of Operations for the three months ended March 31 were:



UNDESIGNATED DERIVATIVE IMPACTS
(Dollars in millions)
		Pretax gain (loss) on derivatives recognized in earnings
		Three months ended March 31,
	Location	2017			2016
Sempra Energy Consolidated:
Foreign exchange instruments	Other Income, Net	$	65		$	3
Foreign exchange instruments	Equity (Losses) Earnings, Net of Income Tax	—			2
Commodity contracts not subject to rate recovery	Revenues: Energy-Related Businesses	14			(1		)
Commodity contracts not subject to rate recovery	Operation and Maintenance	(1		)	—
Commodity contracts subject to rate recovery	Cost of Electric Fuel and Purchased Power	(29		)	(12		)
Commodity contracts subject to rate recovery	Cost of Natural Gas	—			(1		)
Total		$	49		$	(9	)
SDG&E:
Commodity contracts subject to rate recovery	Cost of Electric Fuel and Purchased Power	$	(29	)	$	(12	)
SoCalGas:
Commodity contracts not subject to rate recovery	Operation and Maintenance	$	(1	)	$	—
Commodity contracts subject to rate recovery	Cost of Natural Gas	—			(1		)
Total		$	(1	)	$	(1	)

CONTINGENT FEATURES

For Sempra Energy Consolidated and SDG&E, certain of our derivative instruments contain credit limits which vary depending on our credit ratings. Generally, these provisions, if applicable, may reduce our credit limit if a specified credit rating agency reduces our ratings. In certain cases, if our credit ratings were to fall below investment grade, the counterparty to these derivative liability instruments could request immediate payment or demand immediate and ongoing full collateralization.

For Sempra Energy Consolidated, the total fair value of this group of derivative instruments in a net liability position at March 31, 2017 and December 31, 2016 is $7 million and $10 million, respectively. At March 31, 2017, if the credit ratings of Sempra Energy were reduced below investment grade, $10 million of additional assets could be required to be posted as collateral for these derivative contracts.

For SDG&E, the total fair value of this group of derivative instruments in a net liability position is $1 million at March 31, 2017 and negligible at December 31, 2016. At March 31, 2017, if the credit ratings of SDG&E were reduced below investment grade, $4 million of additional assets could be required to be posted as collateral for these derivative contracts.

For Sempra Energy Consolidated, SDG&E and SoCalGas, some of our derivative contracts contain a provision that would permit the counterparty, in certain circumstances, to request adequate assurance of our performance under the contracts. Such additional assurance, if needed, is not material and is not included in the amounts above.

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

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FAIR VALUE MEASUREMENTS

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

We discuss the valuation techniques and inputs we use to measure fair value and the definition of the three levels of the fair value hierarchy in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

RECURRING FAIR VALUE MEASURES

The three tables below, by level within the fair value hierarchy, set forth our financial assets and liabilities that were accounted for at fair value on a recurring basis at March 31, 2017 and December 31, 2016. We classify financial assets and liabilities in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities, and their placement within the fair value hierarchy levels. We have not changed the valuation techniques or types of inputs we use to measure recurring fair value during the three months ended March 31, 2017.

The fair value of commodity derivative assets and liabilities is presented in accordance with our netting policy, as we discuss in Note 7 under “Financial Statement Presentation.”

The determination of fair values, shown in the tables below, incorporates various factors, including but not limited to, the credit standing of the counterparties involved and the impact of credit enhancements (such as cash deposits, letters of credit and priority interests).

Our financial assets and liabilities that were accounted for at fair value on a recurring basis at March 31, 2017 and December 31, 2016 in the tables below include the following:

▪

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. 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 securities are valued based on yields that are currently available for comparable securities of issuers with similar credit ratings (Level 2).

▪

For commodity contracts, interest rate derivatives and foreign exchange instruments, 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 in “Level 3 Information.”


▪	Rabbi Trust 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). These investments in marketable securities were negligible at both March 31, 2017 and December 31, 2016.

There were no transfers into or out of Level 1, Level 2 or Level 3 for Sempra Energy Consolidated, SDG&E or SoCalGas during the periods presented.



RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED
(Dollars in millions)
	Fair value at March 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	606	$	5	$	—	$	—		$	611
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	40		11		—		—			51
Municipal bonds	—		221		—		—			221
Other securities	—		167		—		—			167
Total debt securities	40		399		—		—			439
Total nuclear decommissioning trusts(2)	646		404		—		—			1,050
Interest rate and foreign exchange instruments	—		99		—		—			99
Commodity contracts not subject to rate recovery	—		23		—		9			32
Commodity contracts subject to rate recovery	—		2		90		20			112
Total	$	646	$	528	$	90	$	29		$	1,293

Liabilities:
Interest rate and foreign exchange instruments	$	—	$	211	$	—	$	—		$	211
Commodity contracts not subject to rate recovery	—		6		—		—			6
Commodity contracts subject to rate recovery	25		8		186		(24		)	195
Total	$	25	$	225	$	186	$	(24	)	$	412

	Fair value at December 31, 2016
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	508	$	—	$	—	$	—		$	508
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	36		16		—		—			52
Municipal bonds	—		206		—		—			206
Other securities	—		141		—		—			141
Total debt securities	36		363		—		—			399
Total nuclear decommissioning trusts(2)	544		363		—		—			907
Interest rate and foreign exchange instruments	—		9		—		—			9
Commodity contracts not subject to rate recovery	—		15		—		9			24
Commodity contracts subject to rate recovery	1		3		96		32			132
Total	$	545	$	390	$	96	$	41		$	1,072

Liabilities:
Interest rate and foreign exchange instruments	$	—	$	252	$	—	$	—		$	252
Commodity contracts not subject to rate recovery	16		11		—		(17		)	10
Commodity contracts subject to rate recovery	19		8		170		(18		)	179
Total	$	35	$	271	$	170	$	(35	)	$	441


(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 March 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	606	$	5	$	—	$	—		$	611
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	40		11		—		—			51
Municipal bonds	—		221		—		—			221
Other securities	—		167		—		—			167
Total debt securities	40		399		—		—			439
Total nuclear decommissioning trusts(2)	646		404		—		—			1,050
Commodity contracts not subject to rate recovery	—		—		—		1			1
Commodity contracts subject to rate recovery	—		—		90		19			109
Total	$	646	$	404	$	90	$	20		$	1,160

Liabilities:
Interest rate instruments	$	—	$	22	$	—	$	—		$	22
Commodity contracts subject to rate recovery	25		7		186		(24		)	194
Total	$	25	$	29	$	186	$	(24	)	$	216

	Fair value at December 31, 2016
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	508	$	—	$	—	$	—		$	508
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	36		16		—		—			52
Municipal bonds	—		206		—		—			206
Other securities	—		141		—		—			141
Total debt securities	36		363		—		—			399
Total nuclear decommissioning trusts(2)	544		363		—		—			907
Commodity contracts not subject to rate recovery	—		—		—		1			1
Commodity contracts subject to rate recovery	1		2		96		30			129
Total	$	545	$	365	$	96	$	31		$	1,037

Liabilities:
Interest rate instruments	$	—	$	25	$	—	$	—		$	25
Commodity contracts subject to rate recovery	17		7		170		(16		)	178
Total	$	17	$	32	$	170	$	(16	)	$	203


(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 March 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Commodity contracts subject to rate recovery	$	—	$	2	$	—	$	1		$	3
Total	$	—	$	2	$	—	$	1		$	3

Liabilities:
Commodity contracts subject to rate recovery	$	—	$	1	$	—	$	—		$	1
Total	$	—	$	1	$	—	$	—		$	1

	Fair value at December 31, 2016
	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		—		2			3
Total	$	—	$	1	$	—	$	3		$	4

Liabilities:
Commodity contracts subject to rate recovery	$	2	$	1	$	—	$	(2	)	$	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 Information

The following table sets forth reconciliations of changes in the fair value of CRRs and long-term, fixed-price electricity positions classified as Level 3 in the fair value hierarchy for Sempra Energy Consolidated and SDG&E:



LEVEL 3 RECONCILIATIONS
(Dollars in millions)
	Three months ended March 31,
	2017			2016
Balance at January 1	$	(74	)	$	19
Realized and unrealized losses	(13		)	(1		)
Settlements	(9		)	(7		)
Balance at March 31	$	(96	)	$	11
Change in unrealized losses relating to
instruments still held at March 31	$	(16	)	$	(1	)

SDG&E’s Energy and Fuel Procurement department, in conjunction with SDG&E’s finance group, is responsible for determining the appropriate fair value methodologies used to value and classify CRRs and long-term, fixed-price electricity positions on an ongoing basis. Inputs used to determine the fair value of CRRs and fixed-price electricity positions are reviewed and compared with market conditions to determine reasonableness. SDG&E expects all costs related to these instruments to be recoverable through customer rates. As such, there is no impact to earnings from changes in the fair value of these instruments.

CRRs are recorded at fair value based almost entirely on the most current auction prices published by the California Independent System Operator (ISO), an objective source. Annual auction prices are published once a year, typically in the middle of November, and are the basis for valuation for the following year. The impact associated with discounting is negligible. Because these auction prices are a less observable input, these instruments are classified as Level 3. The fair value of these instruments is derived from auction price differences between two locations. For CRRs settling from January 1, 2017 to December 31, 2017, the auction price inputs ranged from $(12) per MWh to $7 per MWh at a given location, and for CRRs settling from January 1, 2016 to December 31, 2016, the auction price inputs ranged from $(24) per MWh to $10 per MWh at a given location. Positive values between two locations represent expected future reductions in congestion costs, whereas negative values between two locations represent expected future charges. Valuation of our CRRs is sensitive to a change in auction price. If auction prices at one location increase (decrease) relative to another location, this could result in a higher (lower) fair value measurement. We summarize CRR volumes in Note 7.

Long-term, fixed-price electricity positions that are valued using significant unobservable data are classified as Level 3 because the contract terms relate to a delivery location or tenor for which observable market rate information is not available. The fair value of the net electricity positions classified as Level 3 is derived from a discounted cash flow model using market electricity forward price inputs. These inputs range from $14.50 per MWh to $43.25 per MWh at March 31, 2017. A significant increase or decrease in market electricity forward prices would result in a significantly higher or lower fair value, respectively. We summarize long-term, fixed-price electricity position volumes in Note 7.

Realized gains and losses associated with CRRs and long-term electricity positions, which are recoverable in rates, are recorded in Cost of Electric Fuel and Purchased Power on the Condensed Consolidated Statements of Operations. Unrealized gains and losses are recorded as regulatory assets and liabilities and therefore do not affect earnings.

FAIR VALUE OF FINANCIAL INSTRUMENTS



FAIR VALUE OF FINANCIAL INSTRUMENTS
(Dollars in millions)
	March 31, 2017
	Carrying amount		Fair value
	Carrying amount		Level 1		Level 2		Level 3		Total
Sempra Energy Consolidated:
Long-term amounts due from unconsolidated affiliates(1)	$	168	$	—	$	78	$	86	$	164
Total long-term debt(2)(3)	14,971		—		15,123		496		15,619
SDG&E:
Total long-term debt(3)(4)	$	4,493	$	—	$	4,546	$	302	$	4,848
SoCalGas:
Total long-term debt(5)	$	3,009	$	—	$	3,121	$	—	$	3,121

	December 31, 2016
	Carrying amount		Fair value
	Carrying amount		Level 1		Level 2		Level 3		Total
Sempra Energy Consolidated:
Long-term amounts due from unconsolidated affiliates(1)	$	184	$	—	$	91	$	84	$	175
Total long-term debt(2)(3)	15,068		—		15,455		492		15,947
SDG&E:
Total long-term debt(3)(4)	$	4,654	$	—	$	4,727	$	305	$	5,032
SoCalGas:
Total long-term debt(5)	$	3,009	$	—	$	3,131	$	—	$	3,131


(1)	Excluding accumulated interest outstanding of $19 million and $17 million at March 31, 2017 and December 31, 2016, respectively.

(2)

Before reductions for unamortized discount (net of premium) and debt issuance costs of $105 million and $109 million at March 31, 2017 and December 31, 2016, respectively, and excluding build-to-suit and capital lease obligations of $382 million and $383 million at March 31, 2017 and December 31, 2016, 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.


(3)	Level 3 instruments include $302 million and $305 million at March 31, 2017 and December 31, 2016, respectively, related to Otay Mesa VIE.


(4)	Before reductions for unamortized discount and debt issuance costs of $43 million and $45 million at March 31, 2017 and December 31, 2016, respectively, and excluding capital lease obligations of $239 million and $240 million at March 31, 2017 and December 31, 2016, respectively.


(5)	Before reductions for unamortized discount and debt issuance costs of $26 million and $27 million at March 31, 2017 and December 31, 2016, respectively.

We determine the fair value of certain long-term amounts due from unconsolidated affiliates and long-term debt based on a market approach using quoted market prices for identical or similar securities in thinly-traded markets (Level 2). We value certain other long-term amounts due from unconsolidated affiliates using a perpetuity approach based on the obligation’s fixed interest rate, the absence of a stated maturity date and a discount rate reflecting local borrowing costs (Level 3). We value other long-term debt using an income approach based on the present value of estimated future cash flows discounted at rates available for similar securities (Level 3).

We provide the fair values for the securities held in the nuclear decommissioning trust funds related to the San Onofre Nuclear Generating Station in Note 9.

San Onofre Nuclear Generating Station (SONGS)

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

SAN ONOFRE NUCLEAR GENERATING STATION (SONGS)

3 Months Ended

Mar. 31, 2017

Regulated Operations [Abstract]

SAN ONOFRE NUCLEAR GENERATING STATION (SONGS)

We provide below updates to ongoing matters related to SONGS, a nuclear generating facility near San Clemente, California that ceased operations in June 2013, and in which SDG&E has a 20-percent ownership interest. We discuss SONGS further in Note 13 of the Notes to Consolidated Financial Statements in the Annual Report.

REPLACEMENT STEAM GENERATORS

As part of the Steam Generator Replacement Project, the steam generators were replaced in SONGS Units 2 and 3, and the Units returned to service in 2010 and 2011, respectively. Both Units were shut down in early 2012 after a water leak occurred in the Unit 3 steam generator. Southern California Edison Company (Edison), the majority owner and operator of SONGS, concluded that the leak was due to unexpected wear from tube-to-tube contact. At the time the leak was identified, Edison also inspected and tested Unit 2 and subsequently found unexpected tube wear in Unit 2’s steam generator. These issues with the steam generators ultimately resulted in Edison’s decision to permanently retire SONGS in June 2013.

The replacement steam generators were designed and provided by Mitsubishi Heavy Industries, Ltd., Mitsubishi Nuclear Energy Systems, Inc., and Mitsubishi Heavy Industries America, Inc. (collectively MHI). In July 2013, SDG&E filed a lawsuit against MHI seeking to recover damages SDG&E has incurred and will incur related to the design defects in the steam generators. In October 2013, Edison instituted arbitration proceedings against MHI seeking recovery of damages. The other SONGS co-owners, SDG&E and the City of Riverside, participated as claimants and respondents.

On March 13, 2017, the International Chamber of Commerce International Court of Arbitration (Tribunal) found MHI liable for breach of contract, subject to a contractual limitation of liability, and rejected claimants’ other claims. The Tribunal awarded $118 million in damages to the SONGS co-owners, but determined that MHI was the prevailing party and awarded it 95 percent of its arbitration costs. The damage award is offset by these costs, resulting in a net award of approximately $60 million in favor of the SONGS co-owners. SDG&E’s specific allocation of the damage award is $24 million reduced by costs awarded to MHI of approximately $12 million, resulting in a net damage award of $12 million, which was paid by MHI to SDG&E in March 2017. These amounts include certain adjustments to calculations supporting the Tribunal’s findings. In accordance with the Amended Settlement Agreement discussed below, which may be modified or set aside, SDG&E recorded the proceeds from the MHI arbitration by reducing Operation and Maintenance Expense for previously incurred legal costs of $11 million, and shared the remaining $1 million equally between ratepayers and shareholders.

SETTLEMENT AGREEMENT TO RESOLVE THE CPUC’S ORDER INSTITUTING INVESTIGATION (OII) INTO THE SONGS OUTAGE (SONGS OII)

In November 2012, in response to the outage, the CPUC issued the SONGS OII, which was intended to determine the ultimate recovery of the investment in SONGS and the costs incurred since the commencement of this outage.

In November 2014, the CPUC issued a final decision approving an Amended and Restated Settlement Agreement (Amended Settlement Agreement) in the SONGS OII proceeding executed by SDG&E along with Edison, The Utility Reform Network (TURN), the CPUC Office of Ratepayer Advocates (ORA) and two other intervenors. The Amended Settlement Agreement does not affect ongoing or future proceedings before the Nuclear Regulatory Commission (NRC), or litigation or arbitration related to potential future recoveries from third parties (except for the allocation to ratepayers of any recoveries addressed in the final decision) or proceedings addressing decommissioning activities and costs. We describe the terms and provisions of the Amended Settlement Agreement in Note 13 of the Notes to Consolidated Financial Statements in the Annual Report.

In May 2016, following the filing of petitions for modification by various parties, the CPUC issued a procedural ruling reopening the record of the OII to address the issue of whether the Amended Settlement Agreement is reasonable and in the public interest.

In December 2016, the CPUC issued another procedural ruling directing parties to the SONGS OII to determine whether an agreement could be reached to modify the Amended Settlement Agreement previously approved by the CPUC, to resolve allegations that unreported ex parte communications between Edison and the CPUC resulted in an unfair advantage at the time the settlement agreement was negotiated. Pursuant to the ruling, if no agreement is reached by April 28, 2017, the CPUC will consider other options

including entertaining additional testimony, hearings and briefs. Subsequent to the ruling, the parties have met to confer and, as a result of these discussions, the parties have engaged a mediator and scheduled mediation sessions in June 2017. Given the pending mediation, the parties filed a joint motion with the CPUC in April 2017 requesting that the April 28, 2017 deadline be extended until August 15, 2017. The joint motion is pending before the CPUC.

There is no assurance that the Amended Settlement Agreement will not be renegotiated, modified or set aside as a result of the mediation or the larger OII proceedings, which could result in a substantial reduction in our expected recovery and have a material adverse effect on Sempra Energy’s and SDG&E’s results of operations, financial condition and cash flows.

Accounting and Financial Impacts

Through March 31, 2017, the cumulative after-tax loss from plant closure recorded by Sempra Energy and SDG&E is $125 million. The remaining regulatory asset for the expected recovery of SONGS costs, consistent with the Amended Settlement Agreement, is $175 million ($34 million current and $141 million long-term) at March 31, 2017. The amortization period prescribed for the regulatory asset is 10 years, ending in January 2022.

NUCLEAR DECOMMISSIONING AND FUNDING

As a result of Edison’s decision to permanently retire SONGS Units 2 and 3, Edison began the decommissioning phase of the plant. Decommissioning of Unit 1, removed from service in 1992, is largely complete. The remaining work for Unit 1 will be done once Units 2 and 3 are dismantled. In December 2016, Edison announced that, following a 10-month competitive bid process, it had contracted with a joint venture of AECOM and EnergySolutions (known as SONGS Decommissioning Solutions) as the general contractor to complete the dismantlement of SONGS. The majority of the dismantlement work is expected to take 10 years. SDG&E is responsible for 20 percent of the total contract price.

In accordance with state and federal requirements and regulations, SDG&E has assets held in nuclear decommissioning trusts (NDT) to fund its share of decommissioning costs for SONGS Units 1, 2 and 3. The amounts collected in rates for SONGS’ decommissioning are invested in the NDT, which is comprised of externally managed trust funds. Amounts held by the NDT are invested in accordance with CPUC regulations. The NDT assets are presented on the Sempra Energy and SDG&E Condensed Consolidated Balance Sheets at fair value with the offsetting credits recorded in Regulatory Liabilities Arising from Removal Obligations.

In April 2016, the CPUC adopted a decision approving a total decommissioning cost estimate for SONGS Units 2 and 3 of $4.4 billion (in 2014 dollars), of which SDG&E’s share is $899 million. Except for the use of funds for the planning of decommissioning activities or NDT administrative costs, CPUC approval is required for SDG&E to access the NDT assets to fund SONGS decommissioning costs for Units 2 and 3. SDG&E has received authorization from the CPUC to access NDT funds of up to $302 million for 2013 through 2017 (2017 forecasted) SONGS decommissioning costs. This includes up to $84 million authorized by the CPUC in February 2017 to be withdrawn from the NDT for forecasted 2017 SONGS Units 2 and 3 costs as decommissioning costs are incurred.

In December 2016, the Internal Revenue Service (IRS) and the U.S. Department of the Treasury issued proposed regulations that clarify the definition of “nuclear decommissioning costs,” which are costs that may be paid for or reimbursed from a qualified fund. The proposed regulations state that costs related to the construction and maintenance of independent spent fuel management installations are included in the definition of “nuclear decommissioning costs.” The proposed regulations will be effective prospectively once they are finalized; however, the IRS has stated that it will not challenge taxpayer positions consistent with the proposed regulations for taxable years ending on or after the date the proposed regulations were issued. SDG&E is working with outside counsel to clarify with the IRS some of the provisions in the proposed regulations so as to confirm that the proposed regulations will allow SDG&E to access the NDT for reimbursement or payment of the spent fuel management costs that were or will be incurred in 2016 and subsequent years. It is unclear when SDG&E will receive clarification or when the proposed regulations will be finalized.

The following table shows the fair values and gross unrealized gains and losses for the securities held in the NDT. We provide additional fair value disclosures for the NDT in Note 8.



NUCLEAR DECOMMISSIONING TRUSTS
(Dollars in millions)
	Cost		Gross unrealized gains		Gross unrealized losses			Estimated fair value
At March 31, 2017:
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies(1)	$	51	$	—	$	—		$	51
Municipal bonds(1)	216		6		(1		)	221
Other securities(2)	166		2		(1		)	167
Total debt securities	433		8		(2		)	439
Equity securities	255		358		(2		)	611
Cash and cash equivalents	12		—		—			12
Total	$	700	$	366	$	(4	)	$	1,062
At December 31, 2016:
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	$	52	$	—	$	—		$	52
Municipal bonds	203		4		(1		)	206
Other securities	141		2		(2		)	141
Total debt securities	396		6		(3		)	399
Equity securities	143		366		(1		)	508
Cash and cash equivalents	119		—		—			119
Total	$	658	$	372	$	(4	)	$	1,026


(1)	Maturity dates are 2017-2047.


(2)	Maturity dates are 2017-2066.

The following table shows the proceeds from sales of securities in the NDT and gross realized gains and losses on those sales:



SALES OF SECURITIES
(Dollars in millions)
	Three months ended March 31,
	2017			2016
Proceeds from sales(1)	$	357		$	93
Gross realized gains	45			3
Gross realized losses	(5		)	(8		)


(1)	Excludes securities that are held to maturity.

Net unrealized gains (losses) are included in Regulatory Liabilities Arising from Removal Obligations on Sempra Energy’s and SDG&E’s Condensed Consolidated Balance Sheets. We determine the cost of securities in the trusts on the basis of specific identification. In the first quarter of 2017, sale and purchase activities in our NDT increased significantly compared to the same period in 2016 as a result of continuing changes to our asset allocations initiated in the fourth quarter of 2016 to reduce our equity volatility, lower our duration risk, and increase exposure to municipal bonds and intermediate credit. This shift in our asset mix is intended to reduce the overall risk profile of the NDT, as the plant is in the decommissioning stage.REGULATORY MATTERS

We discuss regulatory matters in Note 14 of the Notes to Consolidated Financial Statements in the Annual Report, and provide updates to those discussions and details of any new matters below.

CALIFORNIA UTILITIES MATTERS

CPUC General Rate Case (GRC)

The CPUC uses a GRC proceeding to set sufficient rates to allow the California Utilities to recover their reasonable cost of operations and maintenance and to provide the opportunity to realize their authorized rates of return on their investment.

In June 2016, the CPUC issued a final decision in the 2016 GRC (2016 GRC FD), the details of which are discussed in Note 14 of the Notes to Consolidated Financial Statements in the Annual Report. The 2016 GRC FD was effective retroactive to January 1, 2016. SDG&E and SoCalGas recorded $9 million and $12 million, respectively, in the second quarter of 2016 for the retroactive after-tax earnings impact related to the first quarter of 2016.

The 2016 GRC FD required the establishment of two-way income tax expense memorandum accounts to track any revenue differences resulting from differences between the income tax expense forecasted in the GRC and the income tax expense incurred by SDG&E and SoCalGas from 2016 through 2018. The accounts will remain open, and the balance in the accounts will be reviewed in subsequent GRC proceedings, until the CPUC decides to close them. Starting in the second quarter of 2016, SoCalGas and SDG&E began recording liabilities associated with tracking the differences in the income tax expense forecasted in the GRC proceedings and the income tax expense incurred. At March 31, 2017, the recorded liability associated with these tracked amounts totaled $39 million and $3 million for SoCalGas and SDG&E, respectively.

SDG&E and SoCalGas are scheduled to file their next GRC applications in the third quarter of 2017. The applications will seek test year revenue requirements for 2019 and attrition year adjustments for 2020 and 2021.

Risk Assessment Mitigation Phase (RAMP) Report

In December 2014, the CPUC issued a decision incorporating a risk-based decision-making framework into all future GRC application filings for major natural gas and electric utilities in California. The framework is intended to assist in assessing safety risks and the utilities’ plans to help ensure that such risks are adequately addressed. In advance of filing the California Utilities’ 2019 GRC applications, two proceedings occurred: the Safety Model Assessment Proceeding and the RAMP. In the Safety Model Assessment Proceeding, the California Utilities demonstrated the models used to prioritize and mitigate risks in order for the CPUC to establish guidelines and standards for these models.

In November 2016, SDG&E and SoCalGas filed their first RAMP report presenting a comprehensive assessment of their key safety risks and proposed activities for mitigating such risks. The report details these risks, which include critical operational issues such as natural gas pipeline safety and wildfire safety, and addresses their classification, scoring, mitigation, alternatives, safety culture, quantitative analysis, data collection and lessons learned. As part of the new framework, funding for any incremental projects or activities is not addressed in the RAMP report and would be subsequently requested in the California Utilities’ upcoming GRC applications.

In March 2017, the CPUC’s Safety and Enforcement Division issued its evaluation report providing generally favorable feedback on the California Utilities’ RAMP report, but recommending more detailed analysis of the risks we presented in the report. The new GRC framework does not require the CPUC to adopt the RAMP report, and we expect that the California Utilities will need to further refine their RAMP assessments and proposed projects and activities, which will ultimately inform the SDG&E and SoCalGas 2019 GRC applications to be filed later this year.

CPUC Cost of Capital

In February 2017, SDG&E, SoCalGas, Pacific Gas and Electric Company (PG&E) and Edison, along with the ORA and TURN, entered into a memorandum of understanding and filed a joint petition with the CPUC seeking a two-year extension for each of the utilities to file its next respective cost of capital application, extending the date to file the next cost of capital application to April 2019 for a 2020 test year. In addition to the two-year extension of the deadline to file the next cost of capital application, the memorandum of understanding contains provisions to reduce the return on equity (ROE) for SDG&E from 10.30 percent to 10.20 percent and for SoCalGas from 10.10 percent to 10.05 percent, effective from January 1, 2018 through December 31, 2019. SDG&E’s and SoCalGas’ ratemaking capital structures will remain at current levels until modified, if at all, by a future cost of capital decision by the CPUC. Also, the utilities will update their cost of capital for actual cost of long-term debt through August 2017 and forecasted cost through

2018, and update preferred stock costs for anticipated issuances (if any) through 2018. The automatic cost of capital adjustment mechanism (CCM) will be in effect to adjust 2019 cost of capital, if necessary. Unless changed by the operation of the CCM, the updated costs of long-term debt and preferred stock (if applicable) and new ROEs will remain in effect through December 31, 2019. No protests were filed in response to the joint petition, and the CPUC issued a proposed decision in April 2017 approving the request. The proposed decision was subsequently withdrawn. We expect that a proposed decision will again be issued.

COMMITMENTS AND CONTINGENCIES

3 Months Ended

Mar. 31, 2017

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

LEGAL PROCEEDINGS

We accrue losses for a legal proceeding when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. However, the uncertainties inherent in legal proceedings make it difficult to estimate with reasonable certainty the costs and effects of resolving these matters. Accordingly, actual costs incurred may differ materially from amounts accrued, may exceed applicable insurance coverage and could materially adversely affect our business, cash flows, results of operations, financial condition and prospects. Unless otherwise indicated, we are unable to estimate reasonably possible losses in excess of any amounts accrued.

At March 31, 2017, accrued liabilities for legal proceedings, including associated legal fees and costs of litigation, were $18 million for Sempra Energy Consolidated, including $11 million for SDG&E and $5 million for SoCalGas. Amounts for Sempra Energy and SoCalGas include $5 million for matters related to the Aliso Canyon natural gas leak, which we discuss below.

SDG&E

2007 Wildfire Litigation

SDG&E has resolved almost all of the lawsuits associated with three wildfires that occurred in October 2007. Two appeals remain pending after judgment in the trial court. SDG&E does not expect additional plaintiffs to file lawsuits given the applicable statutes of limitation, but could receive additional settlement demands and damage estimates from the remaining plaintiffs until the cases are resolved. SDG&E maintains reserves for the wildfire litigation and makes adjustments to these reserves as information becomes available and amounts are estimable.

SDG&E has concluded that it is probable that it will be permitted to recover in rates a substantial portion of the costs incurred to resolve wildfire claims in excess of its liability insurance coverage and the amounts recovered from third parties. Accordingly, at March 31, 2017, Sempra Energy and SDG&E have recorded assets of $350 million in Regulatory Assets (long-term) and Other Regulatory Assets (long-term), respectively, on their Consolidated Balance Sheets ($349 million related to CPUC-regulated operations and $1 million related to Federal Energy Regulatory Commission (FERC)-regulated operations). In September 2015, SDG&E filed an application with the CPUC seeking authority to recover these CPUC-related costs in rates over a six- to ten-year period. The requested amount is the net estimated CPUC-related cost incurred by SDG&E after deductions for insurance reimbursement and third party settlement recoveries, and reflects a voluntary 10-percent shareholder contribution applied to the net Wildfire Expense Memorandum Account balance. In April 2016, the CPUC issued a ruling establishing the scope and schedule for the proceeding, which will be managed in two phases. Phase 1 addresses SDG&E’s operational and management prudence surrounding the 2007 wildfires. We expect a final CPUC decision in late 2017. Phase 2 will address whether SDG&E’s actions and decision-making in connection with settling legal claims in relation to the wildfires were reasonable, with a final CPUC decision expected by early 2019. Should SDG&E conclude that recovery in rates is no longer probable, SDG&E will record a charge against earnings at the time such conclusion is reached. If SDG&E had concluded that the recovery of regulatory assets related to CPUC-regulated operations was no longer probable or was less than currently estimated at March 31, 2017, the resulting after-tax charge against earnings would have been up to approximately $207 million. A failure to obtain substantial or full recovery of these costs from customers, or any negative assessment of the likelihood of recovery, would likely have a material adverse effect on SDG&E’s and Sempra Energy’s results of operations and cash flows.

We discuss how we assess the probability of recovery of our regulatory assets in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

Lawsuit Against MHI

SDG&E participated as a claimant and respondent in an arbitration proceeding initiated by Edison in October 2013 against MHI seeking damages stemming from the failure of the MHI replacement steam generators at the SONGS nuclear power plant. In December 2013, MHI answered and filed a counterclaim against Edison. The arbitration hearing concluded at the end of April 2016.

In March 2017, the Tribunal found MHI liable for breach of contract, subject to a contractual limitation of liability, but determined that MHI was the prevailing party and awarded it 95 percent of its arbitration costs. We discuss this arbitration and decision further in Note 9.

SoCalGas

Aliso Canyon Natural Gas Storage Facility Gas Leak

On October 23, 2015, SoCalGas discovered a leak at one of its injection-and-withdrawal wells, SS25, at its Aliso Canyon natural gas storage facility, located in the northern part of the San Fernando Valley in Los Angeles County. The Aliso Canyon facility has been operated by SoCalGas since 1972. SS25 is one of more than 100 injection-and-withdrawal wells at the storage facility.

Stopping the Leak, and Local Community Mitigation Efforts. SoCalGas worked closely with several of the world’s leading experts to stop the leak, and on February 18, 2016, the California Department of Conservation’s Division of Oil, Gas, and Geothermal Resources (DOGGR) confirmed that the well was permanently sealed.

Pursuant to a stipulation and order by the Los Angeles County Superior Court (Superior Court), SoCalGas provided temporary relocation support to residents in the nearby community who requested it before the well was permanently sealed. Following the permanent sealing of the well, the Los Angeles County Department of Public Health (DPH) conducted indoor testing of certain homes in the Porter Ranch community, and concluded that indoor conditions did not present a long-term health risk and that it was safe for residents to return home. In May 2016, the Superior Court ordered SoCalGas to offer to clean residents’ homes at SoCalGas’ expense as a condition to ending the relocation program. SoCalGas completed the residential cleaning program and the relocation program ended in July 2016.

Apart from the Superior Court order, in May 2016, the DPH also issued a directive that SoCalGas professionally clean (in accordance with the proposed protocol prepared by the DPH) the homes of all residents located within the Porter Ranch Neighborhood Council boundary, or who participated in the relocation program, or who are located within a five mile radius of the Aliso Canyon natural gas storage facility and have experienced symptoms from the natural gas leak (the Directive). SoCalGas disputes the Directive, contending that it is invalid and unenforceable, and has filed a petition for writ of mandate to set aside the Directive.

The total costs incurred to remediate and stop the leak and to mitigate local community impacts are significant and may increase, and we may be subject to civil or administrative fines, costs or other penalties, if awarded or imposed. To the extent any of these costs are not covered by insurance (including any costs in excess of applicable policy limits), or if there were to be significant delays in receiving insurance recoveries, such costs could have a material adverse effect on SoCalGas’ and Sempra Energy’s cash flows, financial condition and results of operations.

Cost Estimates and Accounting Impact. As of March 31, 2017, SoCalGas recorded estimated costs of $799 million related to the leak. Of this amount, approximately 70 percent is for the temporary relocation program (including cleaning costs and certain labor costs) and approximately 20 percent is for efforts to control the well, stop the leak, stop or reduce the emissions, and the estimated cost of the root cause analysis being conducted by an independent third party to determine the cause of the leak. The remaining portion of the $799 million includes legal costs incurred to defend litigation, the value of lost gas, the costs to mitigate the actual natural gas released, and other costs. As the value of lost gas reflects the current replacement cost, the value may fluctuate until such time as replacement gas is purchased and injected into storage. SoCalGas adjusts its estimated total liability associated with the leak as additional information becomes available. The $799 million represents management’s best estimate of these costs related to the leak. Of these costs, a substantial portion has been paid and $49 million is accrued as Reserve for Aliso Canyon Costs as of March 31, 2017 on SoCalGas’ and Sempra Energy’s Condensed Consolidated Balance Sheets for amounts expected to be paid after March 31, 2017.

As of March 31, 2017, we recorded the expected recovery of the costs described in the immediately preceding paragraph related to the leak of $621 million as Insurance Receivable for Aliso Canyon Costs on SoCalGas’ and Sempra Energy’s Condensed Consolidated Balance Sheets. This amount is net of insurance retentions and $173 million of insurance proceeds we received through March 31, 2017 related to control-of-well expenses and temporary relocation costs. If we were to conclude that this receivable or a portion of it was no longer probable of recovery from insurers, some or all of this receivable would be charged against earnings, which could have a material adverse effect on SoCalGas’ and Sempra Energy’s financial condition, results of operations and cash flows.

The above amounts do not include any unsettled damage claims, restitution, or civil, administrative or criminal fines, costs or other penalties that may be imposed in connection with the incident or our responses thereto, as it is not possible to predict the outcome of any civil or criminal proceeding or any administrative action in which such damage awards, restitution or civil, administrative or criminal fines, costs or other penalties could be imposed, and any such amounts, if awarded or imposed or otherwise paid, cannot be reasonably estimated at this time. In addition, the recorded amounts above do not include the costs to clean additional homes pursuant to the DPH Directive, future legal costs necessary to defend litigation, and other potential costs that we currently do not anticipate incurring or that we cannot reasonably estimate.

In March 2016, the CPUC ordered SoCalGas to establish a memorandum account to track its authorized revenue requirement and all revenues that it receives for its normal, business-as-usual costs to own and operate the Aliso Canyon gas storage field and, in September 2016, approved SoCalGas’ request to begin tracking these revenues as of March 17, 2016. The CPUC will determine at a later time whether, and to what extent, the authorized revenues tracked in the memorandum account may be refunded to ratepayers.

Insurance. Excluding directors and officers liability insurance, we have four kinds of insurance policies that together provide between $1.2 billion to $1.4 billion in insurance coverage, depending on the nature of the claims. We cannot predict all of the potential categories of costs or the total amount of costs that we may incur as a result of the leak. Subject to various policy limits, exclusions and conditions, based upon what we know as of the filing date of this report, we believe that our insurance policies collectively should cover the following categories of costs: costs incurred for temporary relocation (including cleaning costs and certain labor costs), costs to address the leak and stop or reduce emissions, the root cause analysis being conducted to determine the cause of the leak, the value of lost natural gas, costs incurred to mitigate the actual natural gas released, costs associated with litigation and claims by nearby residents and businesses, any costs to clean additional homes pursuant to the DPH Directive, and, in some circumstances depending on their nature and manner of assessment, fines and penalties. We have been communicating with our insurance carriers and, as discussed above, we have received insurance payments for a portion of control-of-well expenses and a portion of temporary relocation costs. We intend to pursue the full extent of our insurance coverage for the costs we have incurred or may incur. There can be no assurance that we will be successful in obtaining insurance coverage for these costs under the applicable policies, and to the extent we are not successful, such costs could have a material adverse effect on SoCalGas’ and Sempra Energy’s cash flows, financial condition and results of operations.

Our recorded estimate as of March 31, 2017 of $799 million of certain costs in connection with the Aliso Canyon storage facility leak may rise significantly as more information becomes available, and any costs not included in our estimate could be material. To the extent not covered by insurance (including any costs in excess of applicable policy limits), or if there were to be significant delays in receiving insurance recoveries, such costs could have a material adverse effect on SoCalGas’ and Sempra Energy’s cash flows, financial condition and results of operations.

Governmental Investigations and Civil and Criminal Litigation. Various governmental agencies, including DOGGR, DPH, South Coast Air Quality Management District (SCAQMD), California Air Resources Board (CARB), Los Angeles Regional Water Quality Control Board, California Division of Occupational Safety and Health, CPUC, Pipeline and Hazardous Materials Safety Administration (PHMSA), U.S. Environmental Protection Agency (EPA), Los Angeles County District Attorney’s Office and California Attorney General’s Office, have investigated or are investigating this incident. Other federal agencies (e.g., the U.S. Department of Energy (DOE) and the U.S. Department of the Interior) investigated the incident as part of the joint interagency task force discussed below. In January 2016, DOGGR and the CPUC selected Blade Energy Partners (Blade) to conduct an independent analysis under their supervision and to be funded by SoCalGas to investigate the technical root cause of the Aliso Canyon gas leak. The timing of the root cause analysis is under the control of Blade, DOGGR and the CPUC.

As of May 8, 2017, 266 lawsuits, including over 22,000 plaintiffs, are pending in the Los Angeles County Superior Court against SoCalGas, some of which have also named Sempra Energy. These various lawsuits assert causes of action for negligence, negligence per se, strict liability, property damage, fraud, public and private nuisance (continuing and permanent), trespass, inverse condemnation, fraudulent concealment, unfair business practices and loss of consortium, among other things, and additional litigation may be filed against us in the future related to this incident. A complaint alleging violations of Proposition 65 was also filed. These complaints seek compensatory and punitive damages, civil penalties, injunctive relief, costs of future medical monitoring and attorneys’ fees, and several seek class action status. All of these cases, other than a matter brought by the Los Angeles County District Attorney, the federal securities class action and one of the shareholder derivative actions discussed below, are coordinated before a single court in the Los Angeles County Superior Court for pretrial management.

In addition to the lawsuits described above, a federal securities class action alleging violation of the federal securities laws has been filed against Sempra Energy and certain of its officers and certain of its directors in the United States District Court for the Southern District of California (SDCA), and five shareholder derivative actions alleging breach of fiduciary duties against certain officers and certain directors of Sempra Energy and/or SoCalGas are pending, one in the SDCA and four in the coordination proceeding in the Los Angeles County Superior Court. In March 2017, the SDCA dismissed the shareholder derivative action pending in that court, ruling that the plaintiff did not have standing to pursue the alleged claims; the plaintiff was given leave to seek to amend his complaint to cure its deficiencies.

Pursuant to the coordination proceeding in the Los Angeles County Superior Court, in March 2017, the individuals and business entities asserting tort and Proposition 65 claims filed a Second Amended Consolidated Master Case Complaint for Individual Actions, through which their separate lawsuits will be managed for pretrial purposes. The consolidated complaint asserts causes of action for negligence, negligence per se, private and public nuisance (continuing and permanent), trespass, inverse condemnation, strict liability, negligent and intentional infliction of emotional distress, fraudulent concealment, loss of consortium and violations of Proposition 65 against SoCalGas, with certain causes also naming Sempra Energy. The consolidated complaint seeks compensatory and punitive damages for personal injuries, lost wages and/or lost profits, property damage and diminution in property value, injunctive relief, costs

of future medical monitoring, civil penalties (including penalties associated with Proposition 65 claims alleging violation of requirements for warning about certain chemical exposures), and attorneys’ fees.

In January 2017, pursuant to the coordination proceeding, two consolidated class action complaints were filed against SoCalGas and Sempra Energy, one on behalf of a putative class of persons and businesses who own or lease real property within a five-mile radius of the well (the Property Class Action), and a second on behalf of a putative class of all persons and entities conducting business within five miles of the facility (the Business Class Action). Both complaints assert claims for strict liability for ultra-hazardous activities, negligence and violation of California Unfair Competition Law. The Property Class Action also asserts claims for negligence per se, trespass, permanent and continuing public and private nuisance, and inverse condemnation. The Business Class Action also asserts a claim for negligent interference with prospective economic advantage. Both complaints seek compensatory, statutory and punitive damages, injunctive relief and attorneys’ fees.

Three actions filed by public entities are pending, as follows. These lawsuits are also included in the coordination proceeding in the Los Angeles County Superior Court. First, in July 2016, the County of Los Angeles, on behalf of itself and the people of the State of California, filed a complaint against SoCalGas in the Los Angeles County Superior Court for public nuisance, unfair competition, breach of franchise agreement, breach of lease, and damages. This suit alleges that the four natural gas storage fields operated by SoCalGas in Los Angeles County require safety upgrades, including the installation of a sub-surface safety shut-off valve on every well. It additionally alleges that SoCalGas failed to comply with the DPH Directive. It seeks preliminary and permanent injunctive relief, civil penalties, and damages for the County’s costs to respond to the leak, as well as punitive damages and attorneys’ fees.

Second, in August 2016, the California Attorney General, acting in an independent capacity and on behalf of the people of the State of California and the CARB, together with the Los Angeles City Attorney, filed a third amended complaint on behalf of the people of the State of California against SoCalGas alleging public nuisance, violation of the California Unfair Competition Law, violations of California Health and Safety Code sections 41700, prohibiting discharge of air contaminants that cause annoyance to the public, and 25510, requiring reporting of the release of hazardous material, as well as California Government Code section 12607 for equitable relief for the protection of natural resources. The complaint seeks an order for injunctive relief, to abate the public nuisance, and to impose civil penalties.

Third, in March 2017, the County of Los Angeles filed a petition for writ of mandate against DOGGR and its State Oil & Gas Supervisor, as to which SoCalGas is the real party in interest. The petition alleges that DOGGR has failed to comply with the provisions of Senate Bill (SB) 380, which requires a comprehensive safety review of the Aliso Canyon facility before injection of natural gas may resume, because DOGGR declared the safety review complete before the root cause analysis was complete. The County further alleges that the California Environmental Quality Act requires DOGGR to perform an Environmental Impact Review before the resumption of injection of natural gas at the facility may be approved. The petition seeks a writ of mandate requiring DOGGR and the State Oil & Gas Supervisor to comply with SB 380, and declaratory and injunctive relief against any authorization to inject natural gas, as well as attorneys’ fees.

A complaint filed by the SCAQMD against SoCalGas seeking civil penalties for alleged violations of several nuisance-related statutory provisions arising from the leak and delays in stopping the leak was settled in February 2017, pursuant to which SoCalGas paid $8.5 million, of which $1 million is to be used to pay for a health study. The SCAQMD’s complaint was dismissed in February 2017.

Separately, in February 2016, the Los Angeles County District Attorney’s Office filed a misdemeanor criminal complaint against SoCalGas seeking penalties and other remedies for alleged failure to provide timely notice of the leak pursuant to California Health and Safety Code section 25510(a), Los Angeles County Code section 12.56.030, and Title 19 California Code of Regulations section 2703(a), and for allegedly violating California Health and Safety Code section 41700 prohibiting discharge of air contaminants that cause annoyance to the public. In September 2016, SoCalGas entered into a settlement agreement with the District Attorney’s Office in which it agreed to plead no contest to the notice charge under Health and Safety Code section 25510(a) and agreed to pay the maximum fine of $75,000, penalty assessments of approximately $233,500, and up to $4 million in operational commitments, reimbursement and assessments in exchange for the District Attorney’s Office moving to dismiss the remaining counts at sentencing and settling the complaint (collectively referred to as the District Attorney Settlement). In November 2016, SoCalGas completed the commitments and obligations under the District Attorney Settlement, and on November 29, 2016, the Court approved the settlement and entered judgment on the notice charge. Certain individuals residing near Aliso Canyon who objected to the settlement have filed a notice of appeal of the judgment, as well as a petition asking the Superior Court to set aside the November 29, 2016 order and grant them restitution. The Superior Court dismissed the petition in January 2017, ruling that the petitioners have a remedy at law via their direct appeal.

The costs of defending against these civil and criminal lawsuits, cooperating with these investigations, and any damages, restitution, and civil, administrative and criminal fines, costs and other penalties, if awarded or imposed, as well as the costs of mitigating the actual natural gas released, could be significant and to the extent not covered by insurance (including any costs in excess of applicable

policy limits), or if there were to be significant delays in receiving insurance recoveries, such costs could have a material adverse effect on SoCalGas’ and Sempra Energy’s cash flows, financial condition and results of operations.

Regulatory Proceedings. In February 2017, the CPUC opened a proceeding pursuant to SB 380 to determine the feasibility of minimizing or eliminating the use of the Aliso Canyon natural gas storage facility while still maintaining energy and electric reliability for the region. The proceeding will be conducted in two phases, with Phase 1 conducting an analysis of the feasibility of reducing or eliminating the use of Aliso Canyon and Phase 2 considering the potential implementation of the Phase 1 analysis. In accordance with the Phase 1 schedule, public participation hearings began in April 2017, and workshops are expected to occur later in 2017.

The scope of the order, which is subject to modification, expressly excludes issues with respect to air quality, public health, causation, culpability or cost responsibility regarding the Aliso Canyon gas leak.

Section 455.5 of the California Public Utilities Code, among other things, directs regulated utilities to notify the CPUC if all or any portion of a major facility has been out of service for nine consecutive months. Although SoCalGas does not believe the Aliso Canyon facility or any portion of that facility has been out of service for nine consecutive months, SoCalGas provided notification for transparency, and because the process for obtaining authorization to resume injection operations at the facility is taking longer to complete than initially contemplated. In response, and as required by Section 455.5, the CPUC issued a draft OII to address whether the Aliso Canyon facility or any portion of that facility has been out of service for nine consecutive months pursuant to Section 455.5, and if it is determined to have been out of service, whether the CPUC should adjust SoCalGas’ rates to reflect the period the facility is deemed to have been out of service. If the CPUC adopts the order as drafted and as required under Section 455.5, hearings on the investigation will be consolidated with SoCalGas’ next GRC proceeding. In the event that the CPUC determines that all or any portion of the facility has been out of service for nine consecutive months, the amount of any refund to ratepayers and the inability to earn a return on those assets could have a material adverse effect on SoCalGas’ and Sempra Energy’s cash flows and results of operations.

Governmental Orders and Additional Regulation. In January 2016, the Governor of the State of California issued an Order proclaiming a state of emergency to exist in Los Angeles County due to the natural gas leak at the Aliso Canyon facility. The Governor’s Order imposes various orders with respect to: stopping the leak; protecting public health and safety; ensuring accountability; and strengthening oversight. Most of the directives in the Governor’s Order have been fulfilled, with the following remaining open items: (1) the prohibition against SoCalGas injecting any natural gas into the Aliso Canyon facility will continue until a comprehensive review, utilizing independent experts, of the safety of the storage wells is completed; (2) applicable agencies must convene an independent panel of scientific and medical experts to review public health concerns stemming from the natural gas leak and evaluate whether additional measures are needed to protect public health; (3) the CPUC must ensure that SoCalGas covers costs related to the natural gas leak and its response, while protecting ratepayers, and CARB was ordered to develop a program to fully mitigate the leak’s emissions of methane by March 31, 2016, with such program to be funded by SoCalGas; and (4) DOGGR, CPUC, CARB and California Energy Commission (CEC) must submit to the Governor’s Office a report that assesses the long-term viability of natural gas storage facilities in California.

In December 2015, SoCalGas made a commitment to mitigate the actual natural gas released from the leak and has been working on a plan to accomplish the mitigation. In March 2016, pursuant to the Governor’s Order, the CARB issued its Aliso Canyon Methane Leak Climate Impacts Mitigation Program, which sets forth its recommended approach to achieve full mitigation of the emissions from the Aliso Canyon natural gas leak. The CARB program requires that reductions in short-lived climate pollutants and other greenhouse gases be at least equivalent to the amount of the emissions from the leak, and that the global warming potential to be used in deriving the amount of reductions required is based on a 20-year term (rather than the 100-year term the CARB and other state and federal agencies use in regulating emissions), resulting in a target of approximately 9,000,000 metric tons of carbon dioxide equivalent. CARB’s program also provides that all of the mitigation is to occur in California over the next five to ten years without the use of allowances or offsets. In October 2016, CARB issued its final report concluding that the incident resulted in total emissions from 90,350 to 108,950 metric tons of methane, and asserting that SoCalGas should mitigate 109,000 metric tons of methane to fully mitigate the greenhouse gas impacts of the leak. We have not agreed with CARB’s estimate of methane released and continue to work with CARB on developing a mitigation plan.

In January 2016, the Hearing Board of the SCAQMD ordered SoCalGas to take various actions in connection with injecting and withdrawing natural gas at Aliso Canyon, sealing the well, monitoring, reporting, safety and funding a health impact study, among other things (Abatement Order). SoCalGas fulfilled its obligations under the Abatement Order to the satisfaction of the SCAQMD and its Hearing Board, except for the condition that SoCalGas agree to fund the reasonable costs of a study of the health impacts of the leak. Pursuant to the settlement agreement between SCAQMD and SoCalGas described above, the SCAQMD agreed that the health study condition was satisfied and, in March 2017, the Hearing Board terminated the Abatement Order.

PHMSA, DOGGR, SCAQMD, EPA and CARB have each commenced separate rulemaking proceedings to adopt further regulations covering natural gas storage facilities and injection wells. DOGGR issued new regulations following the Governor’s Order as described above, and in 2016, the California Legislature enacted four separate bills providing for additional regulation of natural gas storage facilities. Additional hearings in the California Legislature, as well as with various other federal and state regulatory agencies,

have been or may be scheduled, additional legislation has been proposed in the California Legislature, and additional laws, orders, rules and regulations may be adopted. The Los Angeles County Board of Supervisors has formed a task force to review and potentially implement new, more stringent land use (zoning) requirements and associated regulations and enforcement protocols for oil and gas activities, including natural gas storage field operations, which could materially affect new or modified uses of the Aliso Canyon and other natural gas storage fields located in Los Angeles County.

Higher operating costs and additional capital expenditures incurred by SoCalGas as a result of new laws, orders, rules and regulations arising out of this incident or our responses thereto could be significant and may not be recoverable in customer rates, and SoCalGas’ and Sempra Energy’s cash flows, financial condition and results of operations may be materially adversely affected by any such new laws, orders, rules and regulations.

Natural Gas Storage Operations and Reliability. Natural gas withdrawn from storage is important for service reliability during peak demand periods, including peak electric generation needs in the summer and heating needs in the winter. Aliso Canyon, with a storage capacity of 86 billion cubic feet (Bcf) (which represents 63 percent of SoCalGas’ natural gas storage inventory capacity), is the largest SoCalGas storage facility and an important element of SoCalGas’ delivery system. SoCalGas calculated that approximately 4.62 Bcf of natural gas was released from the Aliso Canyon natural gas storage facility as a result of the leak. SoCalGas has not injected natural gas into Aliso Canyon since October 25, 2015, pursuant to orders by DOGGR and the Governor, and in accordance with SB 380. Limited withdrawals of natural gas from Aliso Canyon have been made in 2017 to augment gas supplies during critical demand periods. In November 2016, SoCalGas submitted a request to DOGGR seeking authorization to resume injection operations at the Aliso Canyon storage facility. In accordance with SB 380, DOGGR held public meetings in the affected community to provide the public an opportunity to comment on the safety review findings, and the comment period has expired. It remains for DOGGR to issue its safety determination, after which the CPUC’s executive director must concur with DOGGR’s safety determination, before injections at the facility can resume.

If the Aliso Canyon facility were to be taken out of service for any meaningful period of time, it could result in an impairment of the facility and significantly higher than expected operating costs and/or additional capital expenditures, and natural gas reliability and electric generation could be jeopardized. At March 31, 2017, the Aliso Canyon facility has a net book value of $550 million, including $225 million of construction work in progress for the project to construct a new compression station. Any significant impairment of this asset could have a material adverse effect on SoCalGas’ and Sempra Energy’s results of operations for the period in which it is recorded. Higher operating costs and additional capital expenditures incurred by SoCalGas may not be recoverable in customer rates, and SoCalGas’ and Sempra Energy’s results of operations, cash flows and financial condition may be materially adversely affected.

Sempra Mexico

Property Disputes and Permit Challenges

Sempra Mexico has been engaged in a long-running land dispute relating to property adjacent to its Energía Costa Azul LNG terminal near Ensenada, Mexico. A claimant to the adjacent property filed complaints in the federal Agrarian Court challenging the refusal of the Secretaría de la Reforma Agraria (now the Secretaría de Desarrollo Agrario, Territorial y Urbano, or SEDATU) in 2006 to issue a title to him for the disputed property. In November 2013, the Agrarian Court ordered that SEDATU issue the requested title and cause it to be registered. Both SEDATU and Sempra Mexico challenged the ruling, due to lack of notification of the underlying process. Both challenges are pending to be resolved by a Federal Court in Mexico. Sempra Mexico expects additional proceedings regarding the claims.

The property claimant also filed a lawsuit in July 2010 against Sempra Energy in Federal District Court in San Diego seeking compensatory and punitive damages as well as the earnings from the Energía Costa Azul LNG terminal based on his allegations that he was wrongfully evicted from the adjacent property and that he has been harmed by other allegedly improper actions. In September 2015, the Court granted Sempra Energy’s motion for summary judgment and closed the case. The claimant has appealed the summary judgment and an earlier order dismissing certain of his causes of action. Argument on the appeal was held in March 2017.

Additionally, several administrative challenges are pending in Mexico before the Mexican environmental protection agency and the Federal Tax and Administrative Courts seeking revocation of the environmental impact authorization issued to Energía Costa Azul in 2003. These cases generally allege that the conditions and mitigation measures in the environmental impact authorization are inadequate and challenge findings that the activities of the terminal are consistent with regional development guidelines.

Two real property cases have been filed against Energía Costa Azul. In one, the plaintiffs seek to annul the recorded property title for a parcel on which the Energía Costa Azul LNG terminal is situated and to obtain possession of a different parcel that allegedly sits in the same place. A second complaint was served in April 2013 seeking to invalidate the contract by which Energía Costa Azul purchased another of the terminal parcels, on the grounds the purchase price was unfair. In January 2016, the second complaint was dismissed by the Federal Agrarian Court. Sempra Mexico expects further proceedings on these two matters.

In 2015, the Yaqui tribe, with the exception of the Bácum community, granted its consent and a right-of-way easement agreement for the construction of the Guaymas-El Oro segment of IEnova’s Sonora natural gas pipeline that crosses its territory. Representatives of the Bácum community filed an amparo claim in Mexican Federal Court demanding the right to withhold consent for the project, the stoppage of work in the Yaqui territory and damages. The judge granted a suspension order that prohibited the construction through the Bácum community territory only. As a result, IEnova was delayed in the construction of the approximately 14 kilometers of pipeline that pass through territory of the Yaqui tribe. The Comisión Federal de Electricidad agreed to extend the deadline for commercial operations until the second quarter of 2017. Later-appointed Bácum authorities have requested that the Mexican Federal Court dismiss the amparo claim. In the meantime, the portion of the pipeline crossing the Bácum territory has been completed.

In December 2012, Backcountry Against Dumps, Donna Tisdale and the Protect Our Communities Foundation filed a complaint in the United States District Court for the Southern District of California seeking to invalidate the presidential permit issued by the DOE for Energía Sierra Juárez’s cross-border generation tie line (Gen-tie line) connecting the Energía Sierra Juárez wind project in Mexico to the electric grid in the United States. The suit alleged violations of the National Environmental Policy Act (NEPA), the Endangered Species Act, the Migratory Bird Treaty Act and the Bald and Golden Eagle Protection Act. Plaintiffs filed a motion for summary judgment, which the court largely denied in September 2015. One NEPA claim, however, was not resolved – whether the Environmental Impact Statement’s (EIS) assessment of alleged extraterritorial impacts of the Gen-tie line in the United States on the environment in Mexico was inadequate (the “extraterritorial impact issue”) – and was the subject of additional briefing in 2016. On January 30, 2017, the Court issued a ruling on the extraterritorial impact issue and, contrary to its prior ruling, ruled that the EIS was deficient for not considering the effects in Mexico of both the U.S. and Mexican portion of the Gen-tie line and the wind farm itself. The Court has not yet made a decision on the ultimate remedy, and a final judgment has not been entered.

Other Litigation

Sempra Energy holds a noncontrolling interest in RBS Sempra Commodities, a limited liability partnership in the process of being liquidated. The Royal Bank of Scotland (RBS), our partner in the joint venture, paid an £86 million assessment in October 2014 to the United Kingdom’s Revenue and Customs Department (HMRC) for denied value-added tax (VAT) refund claims filed in connection with the purchase of carbon credit allowances by RBS Sempra Energy Europe (RBS SEE), a subsidiary of RBS Sempra Commodities. RBS SEE has since been sold to JP Morgan and later to Mercuria Energy Group, Ltd. HMRC asserted that RBS was not entitled to reduce its VAT liability by VAT paid on certain carbon credit purchases during 2009 because RBS knew or should have known that certain vendors in the trading chain did not remit their own VAT to HMRC. After paying the assessment, RBS filed a Notice of Appeal of the assessment with the First-Tier Tribunal. The First-Tier Tribunal held a preliminary hearing in September 2016 to determine whether HMRC’s assessment was time-barred. In January 2017, the First-Tier Tribunal issued a decision in favor of HMRC concluding that the assessment was not time-barred. RBS has decided not to appeal the First-Tier Tribunal’s decision to the Upper Tribunal. There will be a hearing on the substantive matter regarding whether RBS knew or should have known that certain vendors in the trading chain did not remit their VAT to HMRC.

During 2015, liquidators, acting on behalf of ten companies (the Companies) that engaged in carbon credit trading via chains that included a company that RBS SEE traded with directly, filed a claim in the High Court of Justice asserting damages of £73 million against RBS and Mercuria Energy Europe Trading Limited (the Defendants). The claim alleges that the Defendants’ participation in the purchase and sale of carbon credits resulted in the Companies’ carbon credit trading transactions creating a VAT liability they were unable to pay. JP Morgan has notified us that Mercuria Energy Group, Ltd. has sought indemnity for the claim, and JP Morgan has in turn sought indemnity from us.

Our remaining balance in RBS Sempra Commodities is accounted for under the equity method. The investment balance of $67 million at March 31, 2017 reflects remaining distributions expected to be received from the partnership as it is liquidated. The timing and amount of distributions may be impacted by these matters.

We are also defendants in ordinary routine litigation incidental to our businesses, including personal injury, employment litigation, product liability, property damage and other claims. Juries have demonstrated an increasing willingness to grant large awards, including punitive damages, in these types of cases.

CONTRACTUAL COMMITMENTS

We discuss below significant changes in the first three months of 2017 to contractual commitments discussed in Notes 1 and 15 of the Notes to Consolidated Financial Statements in the Annual Report.

Natural Gas Contracts

Sempra LNG & Midstream’s natural gas purchase and transportation commitments have decreased by $90 million since December 31, 2016, primarily due to payments on existing contracts and changes in forward natural gas prices in the first three months of 2017. Net future payments are expected to decrease by $77 million in 2017 and $13 million in 2018 compared to December 31, 2016.

In May 2016, Sempra LNG & Midstream permanently released certain pipeline capacity that it held with Rockies Express and others, which we discuss in Note 15 of the Notes to Consolidated Financial Statements in the Annual Report. Sempra LNG & Midstream reached an agreement to settle a breach of contract claim against a counterparty in bankruptcy court for $57 million, which was approved by the court on April 25, 2017. Sempra LNG & Midstream expects to receive payment in the second quarter of 2017, which, upon receipt, will be recorded as a reduction to Other Cost of Sales on Sempra Energy’s Condensed Consolidated Statement of Operations.

LNG Purchase Agreement

Sempra LNG & Midstream has a purchase agreement for the supply of LNG to the Energía Costa Azul terminal. The commitment amount is calculated using a predetermined formula based on estimated forward prices of the index applicable from 2017 to 2029. At March 31, 2017, the commitment amount is expected to decrease by $174 million in 2017, $41 million in 2018, $32 million in 2019, $38 million in 2020, $40 million in 2021 and $677 million thereafter (through contract termination in 2029) compared to December 31, 2016, reflecting changes in estimated forward prices since December 31, 2016 and actual transactions for the first three months of 2017. These LNG commitment amounts are based on the assumption that all cargoes, less those already confirmed to be diverted, under the agreement are delivered. Although this agreement specifies a number of cargoes to be delivered, under its terms, the customer may divert certain cargoes, which would reduce amounts paid under the agreement by Sempra LNG & Midstream. Actual LNG purchases in the current and prior years have been significantly lower than the maximum amount provided under the agreement due to the customer electing to divert cargoes as allowed by the agreement.

Capital Leases – Power Purchase Agreements

In the first quarter of 2017, SDG&E satisfied all of the conditions precedent for a CPUC-approved 20-year power purchase agreement with a 500-MW intermediate storage power plant facility that is under construction. Beginning with the initial delivery of the contracted power, scheduled in 2018, the power purchase agreement will be accounted for as a capital lease. Future minimum lease payments under the new power purchase agreement are as follows:



FUTURE MINIMUM PAYMENTS – POWER PURCHASE AGREEMENT
(Dollars in millions)
2017	$	—
2018	88
2019	105
2020	105
2021	105
Thereafter	1,706
Total minimum lease payments(1)	2,109
Less: interest(2)	(1,559		)
Present value of net minimum lease payments	$	550


(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.

Construction and Development Projects

SDG&E

In the first three months of 2017, significant net increases to contractual commitments at SDG&E were $68 million primarily for construction and infrastructure improvements for transmission systems. Net future payments under these contractual commitments are expected to increase by $31 million in 2017 and $42 million in 2018, decrease by $2 million in 2019, increase by $3 million in 2020 and $1 million in 2021, and decrease by $7 million thereafter compared to December 31, 2016.

NUCLEAR INSURANCE

SDG&E and the other owners of SONGS have insurance to cover claims from nuclear liability incidents arising at SONGS. This insurance provides $450 million in coverage limits, the maximum amount available, including coverage for acts of terrorism. In addition, the Price-Anderson Act provides for up to $13 billion of secondary financial protection (SFP). If a nuclear liability loss occurring at any U.S. licensed/commercial reactor exceeds the $450 million insurance limit, all nuclear reactor owners could be required to contribute to the SFP. In such case, SDG&E’s contribution would be up to $50.9 million. This amount is subject to an

annual maximum of $7.6 million, unless a default occurs by any other SONGS owner. If the SFP is insufficient to cover the liability loss, SDG&E could be subject to an additional assessment.

The SONGS owners, including SDG&E, also have $1.5 billion of nuclear property, decontamination, and debris removal insurance, subject to a $2.5 million deductible for “each and every loss.” This insurance coverage is provided through Nuclear Electric Insurance Limited (NEIL). The NEIL policies have specific exclusions and limitations that can result in reduced or eliminated coverage. Insured members as a group are subject to retrospective premium assessments to cover losses sustained by NEIL under all issued policies. SDG&E could be assessed up to $10.4 million of retrospective premiums based on overall member claims. All of SONGS’ insurance claims arising out of the failures of the MHI replacement steam generators have been settled with NEIL, as we discuss in Note 13 of the Notes to Consolidated Financial Statements in the Annual Report.

The nuclear property insurance program includes an industry aggregate loss limit for non-certified acts of terrorism (as defined by the Terrorism Risk Insurance Act). The industry aggregate loss limit for property claims arising from non-certified acts of terrorism is $3.24 billion. This is the maximum amount that will be paid to insured members who suffer losses or damages from these non-certified terrorist acts.

U.S. DEPARTMENT OF ENERGY NUCLEAR FUEL DISPOSAL

The Nuclear Waste Policy Act of 1982 made the DOE responsible for accepting, transporting, and disposing of spent nuclear fuel. However, it is uncertain when the DOE will begin accepting spent nuclear fuel from SONGS. This delay will lead to increased costs for spent fuel storage. SDG&E will continue to support Edison in its pursuit of claims on behalf of the SONGS co-owners against the DOE for its failure to timely accept the spent nuclear fuel. In April 2016, Edison executed a spent fuel settlement agreement with the DOE for $162 million covering damages incurred from January 1, 2006 through December 31, 2013. In May 2016, Edison refunded SDG&E $32 million for its respective share of the damage award paid. In applying this refund, SDG&E recorded a $23 million reduction to the SONGS regulatory asset, an $8 million reduction of its nuclear decommissioning balancing account and a $1 million reduction in its SONGS operation and maintenance cost balancing account.

In September 2016, Edison filed claims with the DOE for $56 million in spent fuel management costs incurred in 2014 and 2015 on behalf of the SONGS co-owners under the terms of the 2016 spent fuel settlement agreement. In February 2017, the DOE reduced the request to approximately $43 million primarily due to reductions to the claimed fuel canister costs. SDG&E’s respective share of the claim is $9 million. We expect Edison’s claim to be resolved, and to receive SDG&E’s portion of the final settlement award, net of legal costs, in the second quarter of 2017.

In October 2015, the California Coastal Commission approved Edison’s application for the proposed expansion of an Independent Spent Fuel Storage Installation (ISFSI) at SONGS. The ISFSI expansion began construction in 2016, will be fully loaded with spent fuel by 2019, and will operate until 2049, when it is assumed that the DOE will have taken custody of all the SONGS spent fuel. The ISFSI would then be decommissioned, and the site restored to its original environmental state.

We provide additional information about SONGS in Note 9 above and in Notes 13 and 15 of the Notes to Consolidated Financial Statements in the Annual Report.

CONCENTRATION OF CREDIT RISK

We maintain credit policies and systems to manage our overall credit risk. These policies include an evaluation of potential counterparties’ financial condition and an assignment of credit limits. These credit limits are established based on risk and return considerations under terms customarily available in the industry. We grant credit to utility customers and counterparties, substantially all of whom are located in our service territory, which covers most of Southern California and a portion of central California for SoCalGas, and all of San Diego County and an adjacent portion of Orange County for SDG&E. We also grant credit to utility customers and counterparties of our other companies providing natural gas or electric services in Mexico, Chile and Peru.

As they become operational, projects owned or partially owned by Sempra LNG & Midstream, Sempra Renewables, Sempra South American Utilities and Sempra Mexico place significant reliance on the ability of their suppliers, customers and partners to perform on long-term agreements and on our ability to enforce contract terms in the event of nonperformance. We consider many factors, including the negotiation of supplier and customer agreements, when we evaluate and approve development projects.

SEGMENT INFORMATION

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

We have six separately managed, reportable segments, as follows:


▪	SDG&E provides electric service to San Diego and southern Orange counties and natural gas service to San Diego County.


▪	SoCalGas is a natural gas distribution utility, serving customers throughout most of Southern California and part of central California.


▪	Sempra South American Utilities develops, owns and operates, or holds interests in, electric transmission, distribution and generation infrastructure in Chile and Peru.

▪

Sempra Mexico develops, owns and operates, or holds interests in, natural gas transmission systems and an ethane system, a liquid petroleum gas pipeline and associated storage terminal, a natural gas distribution utility, electric generation facilities (including wind and solar electric generation facilities and a natural gas-fired power plant), 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. In February 2016, management approved a plan to market and sell the TdM natural gas-fired power plant located in Mexicali, Baja California, as we discuss in Note 3.


▪	Sempra Renewables develops, owns and operates, or holds interests in, wind and solar energy generation facilities serving wholesale electricity markets in the United States.

▪

Sempra LNG & Midstream develops, owns and operates, or holds interests in, a terminal for the import and export of LNG and sale of natural gas, and natural gas pipelines and storage facilities, all within the United States. In September 2016, Sempra LNG & Midstream sold EnergySouth Inc., the parent company of Mobile Gas and Willmut Gas, and in May 2016, sold its 25-percent interest in Rockies Express. We discuss these divestitures in Note 3 of the Notes to Consolidated Financial Statements in the Annual Report.

We evaluate each segment’s performance based on its contribution to Sempra Energy’s reported earnings. The California Utilities operate in essentially separate service territories, under separate regulatory frameworks and rate structures set by the CPUC. The California Utilities’ operations are based on rates set by the CPUC and the FERC. We describe the accounting policies of all of our segments in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report.

Common services shared by the business segments are assigned directly or allocated based on various cost factors, depending on the nature of the service provided. Interest income and expense is recorded on intercompany loans. The loan balances and related interest are eliminated in consolidation.

The following tables show selected information by segment from our Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets. Amounts labeled as “All other” in the following tables consist primarily of parent organizations.



SEGMENT INFORMATION
(Dollars in millions)
	Three months ended March 31,
	2017			2016
REVENUES
SDG&E	$	1,057		$	991
SoCalGas	1,241			1,033
Sempra South American Utilities	412			400
Sempra Mexico	264			138
Sempra Renewables	22			7
Sempra LNG & Midstream	132			130
Intersegment revenues(1)	(97		)	(77		)
Total	$	3,031		$	2,622
INTEREST EXPENSE
SDG&E	$	49		$	48
SoCalGas	25			22
Sempra South American Utilities	9			9
Sempra Mexico	32			4
Sempra Renewables	4			—
Sempra LNG & Midstream	11			12
All other	68			72
Intercompany eliminations	(29		)	(24		)
Total	$	169		$	143
INTEREST INCOME
Sempra South American Utilities	$	5		$	5
Sempra Mexico	2			2
Sempra Renewables	1			1
Sempra LNG & Midstream	17			16
Intercompany eliminations	(19		)	(18		)
Total	$	6		$	6
DEPRECIATION AND AMORTIZATION
SDG&E	$	163		$	159
SoCalGas	126			122
Sempra South American Utilities	13			13
Sempra Mexico	36			17
Sempra Renewables	9			1
Sempra LNG & Midstream	10			13
All other	3			3
Total	$	360		$	328
INCOME TAX EXPENSE (BENEFIT)(2)
SDG&E	$	90		$	65
SoCalGas	98			83
Sempra South American Utilities	19			14
Sempra Mexico	142			40
Sempra Renewables	(11		)	(13		)
Sempra LNG & Midstream	1			(29		)
All other	(44		)	(52		)
Total	$	295		$	108



SEGMENT INFORMATION (CONTINUED)
(Dollars in millions)
	Three months ended March 31,
	2017			2016
EQUITY EARNINGS (LOSSES)
Earnings (losses) recorded before tax:
Sempra Renewables	$	2		$	7
Sempra LNG & Midstream	1			(29		)
Total	$	3		$	(22	)
Earnings (losses) recorded net of tax:
Sempra South American Utilities	$	1		$	2
Sempra Mexico	(9		)	15
Total	$	(8	)	$	17
EARNINGS (LOSSES)(2)
SDG&E	$	155		$	136
SoCalGas(3)	203			199
Sempra South American Utilities	47			38
Sempra Mexico	48			18
Sempra Renewables	11			14
Sempra LNG & Midstream	1			(32		)
All other	(24		)	(20		)
Total	$	441		$	353
EXPENDITURES FOR PROPERTY, PLANT & EQUIPMENT
SDG&E	$	418		$	329
SoCalGas	357			340
Sempra South American Utilities	43			43
Sempra Mexico	94			40
Sempra Renewables	69			181
Sempra LNG & Midstream	3			35
All other	8			3
Total	$	992		$	971
	March 31, 2017			December 31, 2016
ASSETS
SDG&E	$	17,900		$	17,719
SoCalGas	13,602			13,424
Sempra South American Utilities	3,729			3,591
Sempra Mexico	7,702			7,542
Sempra Renewables	2,282			3,644
Sempra LNG & Midstream	5,092			5,564
All other	644			475
Intersegment receivables	(2,667		)	(4,173		)
Total	$	48,284		$	47,786
EQUITY METHOD AND OTHER INVESTMENTS
Sempra South American Utilities	$	20		$	—
Sempra Mexico	212			180
Sempra Renewables	812			844
Sempra LNG & Midstream	999			997
All other	77			76
Total	$	2,120		$	2,097


(1)	Revenues for reportable segments include intersegment revenues of $1 million, $18 million, $25 million and $53 million for the three months ended March 31, 2017 and $3 million, $17 million, $27 million and $30 million for the three months ended March 31, 2016 for SDG&E, SoCalGas, Sempra Mexico and Sempra LNG & Midstream, respectively.


(2)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.

(3)

After preferred dividends.

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e8981-108599

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI http://asc.fasb.org/extlink&oid=68060357&loc=d3e9038-108599

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 33
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Variable Interest Entity Policy

NEW ACCOUNTING STANDARDS (Policies)

3 Months Ended

Mar. 31, 2017

Accounting Policies [Abstract]

Basis of Presentation

BASIS OF PRESENTATION

Throughout this report, we refer to the following as Condensed Consolidated Financial Statements and Notes to Condensed Consolidated Financial Statements when discussed together or collectively:


▪	the Condensed Consolidated Financial Statements and related Notes of Sempra Energy and its subsidiaries and VIEs;


▪	the Condensed Consolidated Financial Statements and related Notes of SDG&E and its VIE; and


▪	the Condensed Financial Statements and related Notes of SoCalGas.

You should read the information in this Quarterly Report in conjunction with the Annual Report.

New Accounting Standards

NEW ACCOUNTING STANDARDS

We describe below recent pronouncements that have had or may have a significant effect on our financial condition, results of operations, cash flows or disclosures.



IMPACT FROM ADOPTION OF ASU 2016-09
(Dollars in millions, except per share amounts)
	Three months ended March 31, 2016
	As previously reported			Effect of adoption			As adjusted
Sempra Energy Consolidated:
Condensed Consolidated Statement of Operations:
Income tax expense	$	(142	)	$	34		$	(108	)
Net income	330			34			364
Earnings	319			34			353

Basic earnings per common share	$	1.28		$	0.13		$	1.41
Diluted earnings per common share	$	1.27		$	0.13		$	1.40
Weighted-average number of shares outstanding, diluted (thousands)	251,412			75			251,487

Condensed Consolidated Statement of Comprehensive Income (Loss):
Net income	$	330		$	34		$	364
Comprehensive income	315			34			349

Condensed Consolidated Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	330		$	34		$	364
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	112			(34		)	78
Other	2			34			36
Net cash provided by operating activities	592			34			626
Cash flows from financing activities:
Tax benefit related to share-based compensation	34			(34		)	—
Net cash provided by financing activities	364			(34		)	330
SDG&E:
Condensed Consolidated Statement of Operations:
Income tax expense	$	(72	)	$	7		$	(65	)
Net income	130			7			137
Earnings attributable to common shares	129			7			136

Condensed Consolidated Statement of Comprehensive Income (Loss):
Net income	$	130		$	7		$	137
Comprehensive income	128			7			135

Condensed Consolidated Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	130		$	7		$	137
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	20			(7		)	13
SoCalGas:
Condensed Statement of Operations:
Income tax expense	$	(87	)	$	4		$	(83	)
Net income	195			4			199

Condensed Statement of Comprehensive Income (Loss):
Net income/Comprehensive income	$	195		$	4		$	199

Condensed Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	195		$	4		$	199
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	59			(4		)	55

VARIABLE INTEREST ENTITIES

We consolidate a VIE if we are the primary beneficiary of the VIE. Our determination of whether we are the primary beneficiary is based on qualitative and quantitative analyses, which assess


▪	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

Noncontrolling Interest Policy

Earnings Per Share Policy

Basic EPS is calculated by dividing earnings attributable to common stock by the weighted-average number of common shares outstanding for the period. Diluted EPS includes the potential dilution of common stock equivalent shares that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.We discuss share-based compensation plans and related awards further in Note 8 of the Notes to Consolidated Financial Statements in the Annual Report.

Interim period effective tax rate policy

Flow-through rate-making treatment tax policy


▪	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 AFUDC related to equity recorded for regulated construction projects at Sempra Mexico has similar flow-through treatment.

Derivatives Policy

FOREIGN CURRENCY DERIVATIVES

HEDGE ACCOUNTING

ENERGY DERIVATIVES

▪


▪	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.

INTEREST RATE DERIVATIVES

Fair Value Measurement Policy

A significant increase or decrease in market electricity forward prices would result in a significantly higher or lower fair value, respectively. We summarize long-term, fixed-price electricity position volumes in Note 7.

FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair values of certain of our financial instruments (cash, temporary investments, accounts and notes receivable, short-term amounts due to/from unconsolidated affiliates, dividends and accounts payable, short-term debt and customer deposits) approximate their carrying amounts because of the short-term nature of these instruments. Investments in life insurance contracts that we hold in support of our Supplemental Executive Retirement, Cash Balance Restoration and Deferred Compensation Plans are carried at cash surrender values, which represent the amount of cash that could be realized under the contracts.Positive values between two locations represent expected future reductions in congestion costs, whereas negative values between two locations represent expected future charges. Valuation of our CRRs is sensitive to a change in auction price. If auction prices at one location increase (decrease) relative to another location, this could result in a higher (lower) fair value measurement. We summarize CRR volumes in Note 7.Long-term, fixed-price electricity positions that are valued using significant unobservable data are classified as Level 3 because the contract terms relate to a delivery location or tenor for which observable market rate information is not available. The fair value of the net electricity positions classified as Level 3 is derived from a discounted cash flow model using market electricity forward price inputs.SDG&E’s Energy and Fuel Procurement department, in conjunction with SDG&E’s finance group, is responsible for determining the appropriate fair value methodologies used to value and classify CRRs and long-term, fixed-price electricity positions on an ongoing basis. Inputs used to determine the fair value of CRRs and fixed-price electricity positions are reviewed and compared with market conditions to determine reasonableness. SDG&E expects all costs related to these instruments to be recoverable through customer rates. As such, there is no impact to earnings from changes in the fair value of these instruments.CRRs are recorded at fair value based almost entirely on the most current auction prices published by the California Independent System Operator (ISO), an objective source. Annual auction prices are published once a year, typically in the middle of November, and are the basis for valuation for the following year. The impact associated with discounting is negligible. Because these auction prices are a less observable input, these instruments are classified as Level 3. The fair value of these instruments is derived from auction price differences between two locations.We classify financial assets and liabilities in their entirety based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities, and their placement within the fair value hierarchy levels. We have not changed the valuation techniques or types of inputs we use to measure recurring fair value during the three months ended March 31, 2017.

The fair value of commodity derivative assets and liabilities is presented in accordance with our netting policy, as we discuss in Note 7 under “Financial Statement Presentation.”

Our financial assets and liabilities that were accounted for at fair value on a recurring basis at March 31, 2017 and December 31, 2016 in the tables below include the following:

▪

Rabbi Trust 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). These investments in marketable securities were negligible at both March 31, 2017 and December 31, 2016.We determine the fair value of certain long-term amounts due from unconsolidated affiliates and long-term debt based on a market approach using quoted market prices for identical or similar securities in thinly-traded markets (Level 2). We value certain other long-term amounts due from unconsolidated affiliates using a perpetuity approach based on the obligation’s fixed interest rate, the absence of a stated maturity date and a discount rate reflecting local borrowing costs (Level 3). We value other long-term debt using an income approach based on the present value of estimated future cash flows discounted at rates available for similar securities (Level 3).

Segment Policy

We have six separately managed, reportable segments, as follows:


▪	SDG&E provides electric service to San Diego and southern Orange counties and natural gas service to San Diego County.


▪	SoCalGas is a natural gas distribution utility, serving customers throughout most of Southern California and part of central California.


▪	Sempra South American Utilities develops, owns and operates, or holds interests in, electric transmission, distribution and generation infrastructure in Chile and Peru.

▪


▪	Sempra Renewables develops, owns and operates, or holds interests in, wind and solar energy generation facilities serving wholesale electricity markets in the United States.

▪

Legal Costs Policy

LEGAL PROCEEDINGSWe accrue losses for a legal proceeding when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. However, the uncertainties inherent in legal proceedings make it difficult to estimate with reasonable certainty the costs and effects of resolving these matters. Accordingly, actual costs incurred may differ materially from amounts accrued, may exceed applicable insurance coverage and could materially adversely affect our business, cash flows, results of operations, financial condition and prospects. Unless otherwise indicated, we are unable to estimate reasonably possible losses in excess of any amounts accrued.

NEW ACCOUNTING STANDARDS (Tables)

3 Months Ended

Mar. 31, 2017

Accounting Policies [Abstract]

Schedule of New Accounting Pronouncement Impact

The following financial statement line items for the three months ended March 31, 2016 were affected by the change in accounting principle:



IMPACT FROM ADOPTION OF ASU 2016-09
(Dollars in millions, except per share amounts)
	Three months ended March 31, 2016
	As previously reported			Effect of adoption			As adjusted
Sempra Energy Consolidated:
Condensed Consolidated Statement of Operations:
Income tax expense	$	(142	)	$	34		$	(108	)
Net income	330			34			364
Earnings	319			34			353

Basic earnings per common share	$	1.28		$	0.13		$	1.41
Diluted earnings per common share	$	1.27		$	0.13		$	1.40
Weighted-average number of shares outstanding, diluted (thousands)	251,412			75			251,487

Condensed Consolidated Statement of Comprehensive Income (Loss):
Net income	$	330		$	34		$	364
Comprehensive income	315			34			349

Condensed Consolidated Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	330		$	34		$	364
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	112			(34		)	78
Other	2			34			36
Net cash provided by operating activities	592			34			626
Cash flows from financing activities:
Tax benefit related to share-based compensation	34			(34		)	—
Net cash provided by financing activities	364			(34		)	330
SDG&E:
Condensed Consolidated Statement of Operations:
Income tax expense	$	(72	)	$	7		$	(65	)
Net income	130			7			137
Earnings attributable to common shares	129			7			136

Condensed Consolidated Statement of Comprehensive Income (Loss):
Net income	$	130		$	7		$	137
Comprehensive income	128			7			135

Condensed Consolidated Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	130		$	7		$	137
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	20			(7		)	13
SoCalGas:
Condensed Statement of Operations:
Income tax expense	$	(87	)	$	4		$	(83	)
Net income	195			4			199

Condensed Statement of Comprehensive Income (Loss):
Net income/Comprehensive income	$	195		$	4		$	199

Condensed Statement of Cash Flows:
Cash flows from operating activities:
Net income	$	195		$	4		$	199
Adjustments to reconcile net income to net cash provided by operating activities:
Deferred income taxes and investment tax credits	59			(4		)	55

ACQUISITION AND DIVESTITURE ACTIVITY (Tables)

3 Months Ended

Mar. 31, 2017

Business Combinations [Abstract]

Schedule of Assets Held for Sale and Deconsolidation of Subsidiary Table

At March 31, 2017, the carrying amounts of the major classes of assets and related liabilities held for sale associated with TdM are as follows:



ASSETS HELD FOR SALE AT MARCH 31, 2017
(Dollars in millions)
	Termoeléctrica de Mexicali
Cash	$	1
Inventories	11
Other current assets	31
Deferred income taxes	9
Property, plant and equipment, net	120
Other noncurrent assets	24
Total assets held for sale	$	196

Accounts payable	$	6
Other current liabilities	4
Asset retirement obligations	4
Other noncurrent liabilities	26
Total liabilities held for sale	$	40

Tabular disclosure of information related to a disposal group. Includes, but is not limited to, a discontinued operation, disposal classified as held-for-sale or disposed of by means other than sale or disposal of an individually significant component.

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Organization, Consolidation and Presentation of Financial Statements [Abstract]

OTHER FINANCIAL DATA (Tables)

3 Months Ended

Mar. 31, 2017

Inventory Table

The components of inventories by segment are as follows:



INVENTORY BALANCES
(Dollars in millions)
	Natural gas				Liquefied natural gas				Materials and supplies				Total
	March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016
SDG&E	$	—	$	2	$	—	$	—	$	82	$	78	$	82	$	80
SoCalGas(1)	—		11		—		—		43		47		43		58
Sempra South American Utilities	—		—		—		—		28		27		28		27
Sempra Mexico	—		—		9		6		2		1		11		7
Sempra Renewables	—		—		—		—		4		4		4		4
Sempra LNG & Midstream	39		79		3		3		—		—		42		82
Sempra Energy Consolidated	$	39	$	92	$	12	$	9	$	159	$	157	$	210	$	258

(1)

At March 31, 2017 and December 31, 2016, SoCalGas’ natural gas inventory for core customers is net of an inventory loss related to the Aliso Canyon natural gas leak, which we discuss in Note 11.

Schedule of Greenhouse Gas Allowances and Obligations Table

The Condensed Consolidated Balance Sheets include the following amounts associated with GHG allowances and obligations.



GHG ALLOWANCES AND OBLIGATIONS
(Dollars in millions)
	Sempra Energy Consolidated				SDG&E				SoCalGas
	March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016
Assets:
Other current assets	$	40	$	40	$	16	$	16	$	24	$	24
Sundry	307		295		184		182		119		109
Total assets	$	347	$	335	$	200	$	198	$	143	$	133

Liabilities:
Other current liabilities	$	40	$	40	$	16	$	16	$	24	$	24
Deferred credits and other	183		171		80		72		99		96
Total liabilities	$	223	$	211	$	96	$	88	$	123	$	120

Variable Interest Entity Table



AMOUNTS ASSOCIATED WITH OTAY MESA VIE
(Dollars in millions)
	Three months ended March 31,
	2017			2016
Operating expenses
Cost of electric fuel and purchased power	$	(18	)	$	(17	)
Operation and maintenance	4			4
Depreciation and amortization	7			7
Total operating expenses	(7		)	(6		)
Operating income	7			6
Interest expense	(5		)	(5		)
Income before income taxes/Net income	2			1
Earnings attributable to noncontrolling interest	(2		)	(1		)
Earnings attributable to common shares	$	—		$	—

Sempra Energy’s Condensed Consolidated Statement of Operations for the three months ended March 31, 2017 includes the following amounts associated with the tax equity limited liability companies. The amounts are net of eliminations of transactions between Sempra Energy and these entities.



AMOUNTS ASSOCIATED WITH TAX EQUITY ARRANGEMENTS
(Dollars in millions)
		Three months ended March 31, 2017
REVENUES
Energy-related businesses		$	13
EXPENSES
Operation and maintenance		(2		)
Depreciation and amortization		(8		)
Income before income taxes		3
Income tax expense		(2		)
Net income		1
Losses attributable to noncontrolling interests(1)		3
Earnings		$	4

(1)	Net income or loss attributable to the noncontrolling interests is computed using the hypothetical liquidation at book value (HLBV) method and is not based on ownership percentages.

Net Periodic Benefit Cost Table

The following three tables provide the components of net periodic benefit cost:



NET PERIODIC BENEFIT COST – SEMPRA ENERGY CONSOLIDATED
(Dollars in millions)
	Pension benefits						Other postretirement benefits
	Three months ended March 31,
	2017			2016			2017			2016
Service cost	$	28		$	28		$	6		$	5
Interest cost	37			40			9			11
Expected return on assets	(40		)	(42		)	(16		)	(17		)
Amortization of:
Prior service cost	3			3			—			—
Actuarial loss (gain)	8			6			(1		)	—
Regulatory adjustment	(12		)	(28		)	2			2
Total net periodic benefit cost	$	24		$	7		$	—		$	1



NET PERIODIC BENEFIT COST – SDG&E
(Dollars in millions)
	Pension benefits						Other postretirement benefits
	Three months ended March 31,
	2017			2016			2017			2016
Service cost	$	8		$	7		$	1		$	1
Interest cost	9			10			2			2
Expected return on assets	(11		)	(12		)	(3		)	(3		)
Amortization of:
Prior service cost	—			—			1			1
Actuarial loss	2			3			—			—
Regulatory adjustment	(7		)	(7		)	(1		)	(1		)
Total net periodic benefit cost	$	1		$	1		$	—		$	—



NET PERIODIC BENEFIT COST – SOCALGAS
(Dollars in millions)
	Pension benefits						Other postretirement benefits
	Three months ended March 31,
	2017			2016			2017			2016
Service cost	$	18		$	17		$	4		$	4
Interest cost	24			25			7			8
Expected return on assets	(26		)	(25		)	(13		)	(14		)
Amortization of:
Prior service cost (credit)	2			2			(1		)	(1		)
Actuarial loss	4			3			—			—
Regulatory adjustment	(5		)	(21		)	3			3
Total net periodic benefit cost	$	17		$	1		$	—		$	—

Contributions to Benefit Plans Table

The following table shows our year-to-date contributions to pension and other postretirement benefit plans and the amounts we expect to contribute in 2017:



BENEFIT PLAN CONTRIBUTIONS
(Dollars in millions)
	Sempra Energy Consolidated		SDG&E		SoCalGas
Contributions through March 31, 2017:
Pension plans	$	26	$	2	$	17
Other postretirement benefit plans	1		—		—
Total expected contributions in 2017:
Pension plans	$	181	$	38	$	90
Other postretirement benefit plans	8		4		1

Earnings Per Share Computations Table



EARNINGS PER SHARE COMPUTATIONS
(Dollars in millions, except per share amounts; shares in thousands)
	Three months ended March 31,
	2017		2016(1)
Numerator:
Earnings/Income attributable to common shares	$	441	$	353

Denominator:
Weighted-average common shares outstanding for basic EPS(2)	251,131		249,734
Dilutive effect of stock options, restricted stock awards and restricted stock units(3)	1,115		1,753
Weighted-average common shares outstanding for diluted EPS	252,246		251,487

Earnings per share:
Basic	$	1.76	$	1.41
Diluted	1.75		1.40


(1)	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.


(2)	Includes 600 and 555 average fully vested restricted stock units held in our Deferred Compensation Plan for the three months ended March 31, 2017 and 2016, 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.


(3)	Due to market fluctuations of both Sempra Energy stock and the comparative indices used to determine the vesting percentage of our total shareholder return performance-based restricted stock units, which we discuss in Note 8 of the Notes to Consolidated Financial Statements in the Annual Report, dilutive restricted stock units may vary widely from period-to-period.

Capitalized Financing Costs Table

Interest capitalized and AFUDC are as follows:



CAPITALIZED FINANCING COSTS
(Dollars in millions)
	Three months ended March 31,
	2017		2016
Sempra Energy Consolidated	$	82	$	52
SDG&E	20		15
SoCalGas	15		13

Schedule of Accumulated Other Comprehensive Income (Loss) Table

The following tables present the changes in AOCI by component and amounts reclassified out of AOCI to net income, excluding amounts attributable to noncontrolling interests:



CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1)
(Dollars in millions)
	Foreign currency translation adjustments			Financial instruments			Pension and other postretirement benefits			Total accumulated other comprehensive income (loss)
	Three months ended March 31, 2017 and 2016
Sempra Energy Consolidated:

Balance as of December 31, 2016	$	(527	)	$	(125	)	$	(96	)	$	(748	)
OCI before reclassifications	46			(2		)	—			44
Amounts reclassified from AOCI	—			6			2			8
Net OCI	46			4			2			52
Balance as of March 31, 2017	$	(481	)	$	(121	)	$	(94	)	$	(696	)

Balance as of December 31, 2015	$	(582	)	$	(137	)	$	(87	)	$	(806	)
OCI before reclassifications	68			(82		)	—			(14		)
Amounts reclassified from AOCI	—			(2		)	1			(1		)
Net OCI	68			(84		)	1			(15		)
Balance as of March 31, 2016	$	(514	)	$	(221	)	$	(86	)	$	(821	)
SDG&E:

Balance as of December 31, 2016 and March 31, 2017							$	(8	)	$	(8	)

Balance as of December 31, 2015 and March 31, 2016							$	(8	)	$	(8	)
SoCalGas:

Balance as of December 31, 2016 and March 31, 2017				$	(13	)	$	(9	)	$	(22	)

Balance as of December 31, 2015 and March 31, 2016				$	(14	)	$	(5	)	$	(19	)

(1)

All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests.

Reclassifications out of AOCI Table



RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
(Dollars in millions)
Details about accumulated other comprehensive income (loss) components	Amounts reclassified from accumulated other comprehensive income (loss)						Affected line item on Condensed Consolidated Statements of Operations
	Three months ended March 31,
	2017			2016
Sempra Energy Consolidated:
Financial instruments:
Interest rate and foreign exchange instruments	$	(3	)	$	4		Interest Expense
Interest rate instruments	2			3			Equity Earnings (Losses), Before Income Tax
Interest rate and foreign exchange instruments	2			1			Equity (Losses) Earnings, Net of Income Tax
Foreign exchange instruments	2			—			Revenues: Energy-Related Businesses
Commodity contracts not subject to rate recovery	9			(7		)	Revenues: Energy-Related Businesses
Total before income tax	12			1
	(4		)	—			Income Tax Expense
Net of income tax	8			1
	(2		)	(3		)	Earnings Attributable to Noncontrolling Interests
	$	6		$	(2	)
Pension and other postretirement benefits:
Amortization of actuarial loss	$	3		$	2		See note (1) below
	(1		)	(1		)	Income Tax Expense
Net of income tax	$	2		$	1

Total reclassifications for the period, net of tax	$	8		$	(1	)
SDG&E:
Financial instruments:
Interest rate instruments	$	3		$	3		Interest Expense
	(3		)	(3		)	Earnings Attributable to Noncontrolling Interest
Total reclassifications for the period	$	—		$	—

(1)

Amounts are included in the computation of net periodic benefit cost (see “Pension and Other Postretirement Benefits” above).

Shareholders' Equity and Noncontrolling Interests Table



SHAREHOLDERS’ EQUITY AND NONCONTROLLING INTERESTS – SEMPRA ENERGY CONSOLIDATED
(Dollars in millions)
	Sempra Energy shareholders’ equity(1)			Non- controlling interests(2)			Total equity(1)
Balance at December 31, 2016	$	12,951		$	2,290		$	15,241
Comprehensive income	493			22			515
Share-based compensation expense	10			—			10
Common stock dividends declared	(206		)	—			(206		)
Issuances of common stock	30			—			30
Repurchases of common stock	(14		)	—			(14		)
Distributions to noncontrolling interests	—			(7		)	(7		)
Balance at March 31, 2017	$	13,264		$	2,305		$	15,569
Balance at December 31, 2015	$	11,809		$	770		$	12,579
Cumulative-effect adjustment from change in accounting principle	107			—			107
Comprehensive income	338			11			349
Share-based compensation expense	13			—			13
Common stock dividends declared	(188		)	—			(188		)
Issuances of common stock	28			—			28
Repurchases of common stock	(54		)	—			(54		)
Distributions to noncontrolling interests	—			(3		)	(3		)
Balance at March 31, 2016	$	12,053		$	778		$	12,831


(1)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.


(2)	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 shareholder’s equity(1)			Non- controlling interest			Total equity(1)
Balance at December 31, 2016	$	5,641		$	37		$	5,678
Comprehensive income	155			5			160
Common stock dividends declared	(175		)	—			(175		)
Distributions to noncontrolling interest	—			(3		)	(3		)
Balance at March 31, 2017	$	5,621		$	39		$	5,660
Balance at December 31, 2015	$	5,223		$	53		$	5,276
Cumulative-effect adjustment from change in accounting principle	23			—			23
Comprehensive income (loss)	136			(1		)	135
Distributions to noncontrolling interest	—			(1		)	(1		)
Balance at March 31, 2016	$	5,382		$	51		$	5,433


(1)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.



SHAREHOLDERS’ EQUITY – SOCALGAS
(Dollars in millions)
	Total equity(1)
Balance at December 31, 2016	$	3,510
Comprehensive income	203
Balance at March 31, 2017	$	3,713
Balance at December 31, 2015	$	3,149
Cumulative-effect adjustment from change in accounting principle	15
Comprehensive income	199
Balance at March 31, 2016	$	3,363


(1)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.

Ownership Interests Held By Others Table



OTHER NONCONTROLLING INTERESTS
(Dollars in millions)
	Percent ownership held by noncontrolling interests				Equity held by noncontrolling interests
	March 31, 2017		December 31, 2016		March 31, 2017		December 31, 2016
SDG&E:
Otay Mesa VIE	100	%	100	%	$	39	$	37
Sempra South American Utilities:
Chilquinta Energía subsidiaries(1)	22.9 – 43.4		23.1 – 43.4		23		22
Luz del Sur	16.4		16.4		182		173
Tecsur	9.8		9.8		4		4
Sempra Mexico:
IEnova	33.6		33.6		1,531		1,524
Sempra Renewables:
Tax equity arrangement – wind(2)	NA		NA		93		92
Tax equity arrangement – solar(2)	NA		NA		371		376
Sempra LNG & Midstream:
Bay Gas Storage Company, Ltd.	9.1		9.1		27		27
Liberty Gas Storage, LLC	23.3		23.3		14		14
Southern Gas Transmission Company	49.0		49.0		1		1
Total Sempra Energy					$	2,285	$	2,270


(1)	Chilquinta Energía has four subsidiaries with noncontrolling interests held by others. Percentage range reflects the highest and lowest ownership percentages among these subsidiaries.

(2)

Transactions with Affiliates Table

Amounts due from and to unconsolidated affiliates at Sempra Energy Consolidated, SDG&E and SoCalGas are as follows:



AMOUNTS DUE FROM (TO) UNCONSOLIDATED AFFILIATES
(Dollars in millions)
	March 31, 2017			December 31, 2016
Sempra Energy Consolidated:
Total due from various unconsolidated affiliates – current	$	24		$	26

Sempra South American Utilities(1):
Eletrans S.A. and Eletrans II S.A. – 4% Note(2)	$	82		$	96
Other related party receivables	1			1
Sempra Mexico(1):
Affiliate of joint venture with Ductos y Energéticos del Norte:
Note due November 14, 2018(3)	2			2
Note due November 14, 2018(3)	44			44
Note due November 14, 2018(3)	36			35
Note due November 14, 2018(3)	9			9
Energía Sierra Juárez – Note(4)	13			14
Total due from unconsolidated affiliates – noncurrent	$	187		$	201

Total due to various unconsolidated affiliates – current	$	(13	)	$	(11	)
SDG&E:
Sempra Energy(5)	$	—		$	3
Various affiliates	—			1
Total due from various unconsolidated affiliates – current	$	—		$	4

Sempra Energy	$	(28	)	$	—
SoCalGas	(9		)	(8		)
Various affiliates	(8		)	(7		)
Total due to various unconsolidated affiliates – current	$	(45	)	$	(15	)

Income taxes due from Sempra Energy(6)	$	109		$	159
SoCalGas:
Sempra Energy(7)	$	7		$	—
SDG&E	9			8
Total due from unconsolidated affiliates – current	$	16		$	8

Sempra Energy	$	—		$	(28	)
Total due to unconsolidated affiliates – current	$	—		$	(28	)

Income taxes due (to) from Sempra Energy(6)	$	(13	)	$	5


(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. and Eletrans II S.A. (collectively, Eletrans), which is a joint venture of Chilquinta Energía.


(3)	U.S. dollar-denominated loan, at a variable interest rate based on the 30-day LIBOR plus 450 basis points (5.48 percent at March 31, 2017), to finance the Los Ramones Norte pipeline.


(4)	U.S. dollar-denominated loan, at a variable interest rate based on the 30-day LIBOR plus 637.5 basis points (7.36 percent at March 31, 2017) with no stated maturity date, to finance the first phase of the Energía Sierra Juárez wind project, which is a joint venture of IEnova.


(5)	At December 31, 2016, net receivable included outstanding advances to Sempra Energy of $31 million at an interest rate of 0.68 percent.


(6)	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.


(7)	At March 31, 2017, net receivable included outstanding advances to Sempra Energy of $35 million at an interest rate of 0.95 percent.

Revenues and cost of sales from unconsolidated affiliates are as follows:



REVENUES AND COST OF SALES FROM UNCONSOLIDATED AFFILIATES
(Dollars in millions)
	Three months ended March 31,
	2017		2016
Revenues:
Sempra Energy Consolidated	$	7	$	5
SDG&E	2		3
SoCalGas	18		17
Cost of Sales:
Sempra Energy Consolidated	$	14	$	30
SDG&E	20		14

Other Income and Expense Table

Other Income, Net on the Condensed Consolidated Statements of Operations consists of the following:



OTHER INCOME, NET
(Dollars in millions)
	Three months ended March 31,
	2017		2016
Sempra Energy Consolidated:
Allowance for equity funds used during construction	$	72	$	27
Investment gains(1)	16		10
Gains on interest rate and foreign exchange instruments, net	63		3
Foreign currency transaction gains (losses)	10		(2		)
Sale of other investments	—		1
Electrical infrastructure relocation income(2)	—		1
Regulatory interest, net(3)	2		2
Sundry, net	6		7
Total	$	169	$	49
SDG&E:
Allowance for equity funds used during construction	$	15	$	11
Regulatory interest, net(3)	2		2
Sundry, net	1		1
Total	$	18	$	14
SoCalGas:
Allowance for equity funds used during construction	$	11	$	10
Total	$	11	$	10


(1)	Represents investment 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, recorded in Operation and Maintenance on the Condensed Consolidated Statements of Operations.


(2)	Income at Luz del Sur associated with the relocation of electrical infrastructure.

(3)

Interest on regulatory balancing accounts.

Income Tax Expense and Effective Income Tax Rates Table



INCOME TAX EXPENSE AND EFFECTIVE INCOME TAX RATES
(Dollars in millions)
	Income tax expense		Effective income tax rate		Income tax expense		Effective income tax rate
	Three months ended March 31,
	2017				2016(1)
Sempra Energy Consolidated	$	295	39	%	$	108	24	%
SDG&E	90		36		65		32
SoCalGas	98		33		83		29

(1)

Reflects the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.

DEBT AND CREDIT FACILITIES (Tables)

3 Months Ended

Mar. 31, 2017

Debt Disclosure [Abstract]

Schedule of Line of Credit Facilities



CREDIT FACILITIES IN SOUTH AMERICA AND MEXICO
(U.S. dollar equivalent in millions)
			At March 31, 2017
		Denominated in	Total facility		Amount outstanding				Available unused credit
Sempra South American Utilities(1):
	Peru(2)	Peruvian sol	$	392	$	(155	)	(3)	$	237
	Chile	Chilean peso	115		—				115
Sempra Mexico:
	IEnova(4)	U.S. dollar	1,170		(446		)		724
Total			$	1,677	$	(601	)		$	1,076

(1) The credit facilities were entered into to finance working capital and for general corporate purposes and expire between 2017 and 2020.

(2) The Peruvian facilities require a debt to equity ratio of no more than 170 percent, with which we were in compliance at March 31, 2017.

(3) Includes bank guarantees of $12 million.

(4) Five-year revolver expiring in August 2020 with a syndicate of eight lenders.



PRIMARY U.S. COMMITTED LINES OF CREDIT
(Dollars in millions)
		At March 31, 2017
		Total facility			Commercial paper outstanding			Adjustment for combined limit			Letters of credit outstanding			Available unused credit
Sempra Energy(1)		$	1,000		$	—		$	—		$	(65	)	$	935
Sempra Global(2)		2,335			(1,197		)	—			—			1,138
California Utilities(3):
	SDG&E	750			(343		)	—			—			407
	SoCalGas	750			—			(93		)	—			657
	Less: combined limit of $1 billion for both utilities	(500		)	—			93			—			(407		)
		1,000			(343		)	—			—			657
Total		$	4,335		$	(1,540	)	$	—		$	(65	)	$	2,730

(1) The facility also provides for issuance of up to $400 million of letters of credit on behalf of Sempra Energy with the amount of borrowings

otherwise available under the facility reduced by the amount of outstanding letters of credit.

(2) Sempra Energy guarantees Sempra Global’s obligations under the credit facility.

DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Mar. 31, 2017

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Commodity Derivative Volumes Table

We summarize net energy derivative volumes at March 31, 2017 and December 31, 2016 as follows:



NET ENERGY DERIVATIVE VOLUMES
(Quantities in millions)
Commodity	Unit of measure	March 31, 2017	December 31, 2016
California Utilities:
SDG&E:
Natural gas	MMBtu(1)	44	48
Electricity	MWh(2)	4	4
Congestion revenue rights	MWh	45	48
SoCalGas – natural gas	MMBtu	—	1

Energy-Related Businesses:
Sempra LNG & Midstream – natural gas	MMBtu	16	31


(1)	Million British thermal units

(2)

Megawatt hours

Notional Amounts of Interest Rate Derivatives Table

At March 31, 2017 and December 31, 2016, the net notional amounts of our foreign currency derivatives, excluding joint ventures, were:



FOREIGN CURRENCY DERIVATIVES
(Dollars in millions)
	March 31, 2017			December 31, 2016
	Notional amount		Maturities	Notional amount		Maturities
Sempra Energy Consolidated:
Cross-currency swaps	$	408	2017-2023	$	408	2017-2023
Other foreign currency derivatives(1)	922		2017-2018	86		2017-2018


(1)	In the three months ended March 31, 2017, we entered into foreign currency derivatives with notional amounts totaling $850 million that expire in December 2017.

At March 31, 2017 and December 31, 2016, the net notional amounts of our interest rate derivatives, excluding joint ventures, were:



INTEREST RATE DERIVATIVES
(Dollars in millions)
	March 31, 2017			December 31, 2016
	Notional debt		Maturities	Notional debt		Maturities
Sempra Energy Consolidated:
Cash flow hedges(1)	$	910	2017-2032	$	924	2017-2032
SDG&E:
Cash flow hedges(1)	302		2017-2019	305		2017-2019


(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 Table

The following tables provide the fair values of derivative instruments on the Condensed Consolidated Balance Sheets at March 31, 2017 and December 31, 2016, including the amount of cash collateral receivables that were not offset, as the cash collateral is in excess of liability positions.



DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
	March 31, 2017
	Current assets: Fixed-price contracts and other derivatives(1)			Other assets: Sundry			Current liabilities: Fixed-price contracts and other derivatives(2)			Deferred credits and other liabilities: Fixed-price contracts and other derivatives
Sempra Energy Consolidated:
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments(3)	$	—		$	1		$	(56	)	$	(155	)
Derivatives not designated as hedging instruments:
Foreign exchange instruments	98			—			—			—
Commodity contracts not subject to rate recovery	67			31			(60		)	(21		)
Associated offsetting commodity contracts	(54		)	(21		)	54			21
Commodity contracts subject to rate recovery	25			71			(60		)	(163		)
Associated offsetting commodity contracts	(4		)	—			4			—
Associated offsetting cash collateral	—			—			9			15
Net amounts presented on the balance sheet	132			82			(109		)	(303		)
Additional cash collateral for commodity contracts not subject to rate recovery	9			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	20			—			—			—
Total(4)	$	161		$	82		$	(109	)	$	(303	)
SDG&E:
Derivatives designated as hedging instruments:
Interest rate instruments(3)	$	—		$	—		$	(13	)	$	(9	)
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	23			71			(59		)	(163		)
Associated offsetting commodity contracts	(4		)	—			4			—
Associated offsetting cash collateral	—			—			9			15
Net amounts presented on the balance sheet	19			71			(59		)	(157		)
Additional cash collateral for commodity contracts not subject to rate recovery	1			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	19			—			—			—
Total(4)	$	39		$	71		$	(59	)	$	(157	)
SoCalGas:
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	$	2		$	—		$	(1	)	$	—
Net amounts presented on the balance sheet	2			—			(1		)	—
Additional cash collateral for commodity contracts subject to rate recovery	1			—			—			—
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.



DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
	December 31, 2016
	Current assets: Fixed-price contracts and other derivatives(1)			Other assets: Sundry			Current liabilities: Fixed-price contracts and other derivatives(2)			Deferred credits and other liabilities: Fixed-price contracts and other derivatives
Sempra Energy Consolidated:
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments(3)	$	7		$	2		$	(24	)	$	(228	)
Commodity contracts not subject to rate recovery	—			—			(14		)	—
Derivatives not designated as hedging instruments:
Commodity contracts not subject to rate recovery	248			36			(254		)	(28		)
Associated offsetting commodity contracts	(242		)	(27		)	242			27
Associated offsetting cash collateral	—			(1		)	16			1
Commodity contracts subject to rate recovery	37			73			(57		)	(150		)
Associated offsetting commodity contracts	(9		)	(1		)	9			1
Associated offsetting cash collateral	—			—			5			13
Net amounts presented on the balance sheet	41			82			(77		)	(364		)
Additional cash collateral for commodity contracts not subject to rate recovery	10			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	32			—			—			—
Total(4)	$	83		$	82		$	(77	)	$	(364	)
SDG&E:
Derivatives designated as hedging instruments:
Interest rate instruments(3)	$	—		$	—		$	(13	)	$	(12	)
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	33			73			(51		)	(150		)
Associated offsetting commodity contracts	(6		)	(1		)	6			1
Associated offsetting cash collateral	—			—			3			13
Net amounts presented on the balance sheet	27			72			(55		)	(148		)
Additional cash collateral for commodity contracts not subject to rate recovery	1			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	30			—			—			—
Total(4)	$	58		$	72		$	(55	)	$	(148	)
SoCalGas:
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	$	4		$	—		$	(6	)	$	—
Associated offsetting commodity contracts	(3		)	—			3			—
Associated offsetting cash collateral	—			—			2			—
Net amounts presented on the balance sheet	1			—			(1		)	—
Additional cash collateral for commodity contracts not subject to rate recovery	1			—			—			—
Additional cash collateral for commodity contracts subject to rate recovery	2			—			—			—
Total	$	4		$	—		$	(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.

Cash Flow Hedge Impact on the Condensed Consolidated Statements of Comprehensive Income Table



FAIR VALUE HEDGE IMPACTS
(Dollars in millions)
			Pretax gain on derivatives recognized in earnings
			Three months ended
		Location	March 31, 2016
Sempra Energy Consolidated:
Interest rate instruments(1)		Interest Expense	$	2

(1)	There was no hedge ineffectiveness in the three months ended March 31, 2016. 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 recorded in Other Income, Net.



CASH FLOW HEDGE IMPACTS
(Dollars in millions)
	Pretax gain (loss) recognized in OCI							Pretax gain (loss) reclassified from AOCI into earnings
	Three months ended March 31,							Three months ended March 31,
	2017			2016			Location	2017			2016
Sempra Energy Consolidated:
Interest rate and foreign exchange instruments(1)	$	16		$	(11	)	Interest Expense	$	3		$	(4	)
Interest rate instruments	(5		)	(137		)	Equity Earnings (Losses), Before Income Tax	(2		)	(3		)
Interest rate and foreign exchange instruments	(9		)	(18		)	Equity (Losses) Earnings, Net of Income Tax	(2		)	(1		)
Foreign exchange instruments	(9		)	—			Revenues: Energy- Related Businesses	(2		)	—
Commodity contracts not subject to rate recovery	3			1			Revenues: Energy- Related Businesses	(9		)	7
Total(2)	$	(4	)	$	(165	)		$	(12	)	$	(1	)
SDG&E:
Interest rate instruments(1)(2)	$	—		$	(5	)	Interest Expense	$	(3	)	$	(3	)


(1)	Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE.


(2)	There was negligible hedge ineffectiveness related to these cash flow hedges in the three months ended March 31, 2017 and 2016.

Fair Value Hedge Impact on the Condensed Consolidated Statements of Operations Table

The effects of derivative instruments not designated as hedging instruments on the Condensed Consolidated Statements of Operations for the three months ended March 31 were:



UNDESIGNATED DERIVATIVE IMPACTS
(Dollars in millions)
		Pretax gain (loss) on derivatives recognized in earnings
		Three months ended March 31,
	Location	2017			2016
Sempra Energy Consolidated:
Foreign exchange instruments	Other Income, Net	$	65		$	3
Foreign exchange instruments	Equity (Losses) Earnings, Net of Income Tax	—			2
Commodity contracts not subject to rate recovery	Revenues: Energy-Related Businesses	14			(1		)
Commodity contracts not subject to rate recovery	Operation and Maintenance	(1		)	—
Commodity contracts subject to rate recovery	Cost of Electric Fuel and Purchased Power	(29		)	(12		)
Commodity contracts subject to rate recovery	Cost of Natural Gas	—			(1		)
Total		$	49		$	(9	)
SDG&E:
Commodity contracts subject to rate recovery	Cost of Electric Fuel and Purchased Power	$	(29	)	$	(12	)
SoCalGas:
Commodity contracts not subject to rate recovery	Operation and Maintenance	$	(1	)	$	—
Commodity contracts subject to rate recovery	Cost of Natural Gas	—			(1		)
Total		$	(1	)	$	(1	)

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41641-113959

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4B
-URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624163-113959

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41678-113959

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41638-113959

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1B
-URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5580258-113959

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5579245-113959

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4C
-URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5624171-113959

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=64837297&loc=SL5579240-113959

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64837297&loc=d3e41620-113959

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(n)(2))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Recurring Fair Value Measures Table

FAIR VALUE MEASUREMENTS (Tables)

3 Months Ended

Mar. 31, 2017

Fair Value Disclosures [Abstract]



RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED
(Dollars in millions)
	Fair value at March 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	606	$	5	$	—	$	—		$	611
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	40		11		—		—			51
Municipal bonds	—		221		—		—			221
Other securities	—		167		—		—			167
Total debt securities	40		399		—		—			439
Total nuclear decommissioning trusts(2)	646		404		—		—			1,050
Interest rate and foreign exchange instruments	—		99		—		—			99
Commodity contracts not subject to rate recovery	—		23		—		9			32
Commodity contracts subject to rate recovery	—		2		90		20			112
Total	$	646	$	528	$	90	$	29		$	1,293

Liabilities:
Interest rate and foreign exchange instruments	$	—	$	211	$	—	$	—		$	211
Commodity contracts not subject to rate recovery	—		6		—		—			6
Commodity contracts subject to rate recovery	25		8		186		(24		)	195
Total	$	25	$	225	$	186	$	(24	)	$	412

	Fair value at December 31, 2016
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	508	$	—	$	—	$	—		$	508
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	36		16		—		—			52
Municipal bonds	—		206		—		—			206
Other securities	—		141		—		—			141
Total debt securities	36		363		—		—			399
Total nuclear decommissioning trusts(2)	544		363		—		—			907
Interest rate and foreign exchange instruments	—		9		—		—			9
Commodity contracts not subject to rate recovery	—		15		—		9			24
Commodity contracts subject to rate recovery	1		3		96		32			132
Total	$	545	$	390	$	96	$	41		$	1,072

Liabilities:
Interest rate and foreign exchange instruments	$	—	$	252	$	—	$	—		$	252
Commodity contracts not subject to rate recovery	16		11		—		(17		)	10
Commodity contracts subject to rate recovery	19		8		170		(18		)	179
Total	$	35	$	271	$	170	$	(35	)	$	441


(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 March 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	606	$	5	$	—	$	—		$	611
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	40		11		—		—			51
Municipal bonds	—		221		—		—			221
Other securities	—		167		—		—			167
Total debt securities	40		399		—		—			439
Total nuclear decommissioning trusts(2)	646		404		—		—			1,050
Commodity contracts not subject to rate recovery	—		—		—		1			1
Commodity contracts subject to rate recovery	—		—		90		19			109
Total	$	646	$	404	$	90	$	20		$	1,160

Liabilities:
Interest rate instruments	$	—	$	22	$	—	$	—		$	22
Commodity contracts subject to rate recovery	25		7		186		(24		)	194
Total	$	25	$	29	$	186	$	(24	)	$	216

	Fair value at December 31, 2016
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Nuclear decommissioning trusts:
Equity securities	$	508	$	—	$	—	$	—		$	508
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	36		16		—		—			52
Municipal bonds	—		206		—		—			206
Other securities	—		141		—		—			141
Total debt securities	36		363		—		—			399
Total nuclear decommissioning trusts(2)	544		363		—		—			907
Commodity contracts not subject to rate recovery	—		—		—		1			1
Commodity contracts subject to rate recovery	1		2		96		30			129
Total	$	545	$	365	$	96	$	31		$	1,037

Liabilities:
Interest rate instruments	$	—	$	25	$	—	$	—		$	25
Commodity contracts subject to rate recovery	17		7		170		(16		)	178
Total	$	17	$	32	$	170	$	(16	)	$	203


(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 March 31, 2017
	Level 1		Level 2		Level 3		Netting(1)			Total
Assets:
Commodity contracts subject to rate recovery	$	—	$	2	$	—	$	1		$	3
Total	$	—	$	2	$	—	$	1		$	3

Liabilities:
Commodity contracts subject to rate recovery	$	—	$	1	$	—	$	—		$	1
Total	$	—	$	1	$	—	$	—		$	1

	Fair value at December 31, 2016
	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		—		2			3
Total	$	—	$	1	$	—	$	3		$	4

Liabilities:
Commodity contracts subject to rate recovery	$	2	$	1	$	—	$	(2	)	$	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.

Recurring Fair Value Measures Level 3 Rollforward Table



LEVEL 3 RECONCILIATIONS
(Dollars in millions)
	Three months ended March 31,
	2017			2016
Balance at January 1	$	(74	)	$	19
Realized and unrealized losses	(13		)	(1		)
Settlements	(9		)	(7		)
Balance at March 31	$	(96	)	$	11
Change in unrealized losses relating to
instruments still held at March 31	$	(16	)	$	(1	)

Fair Value of Financial Instruments Table

The following table provides the carrying amounts and fair values of certain other financial instruments that are not recorded at fair value on the Condensed Consolidated Balance Sheets at March 31, 2017 and December 31, 2016:



FAIR VALUE OF FINANCIAL INSTRUMENTS
(Dollars in millions)
	March 31, 2017
	Carrying amount		Fair value
	Carrying amount		Level 1		Level 2		Level 3		Total
Sempra Energy Consolidated:
Long-term amounts due from unconsolidated affiliates(1)	$	168	$	—	$	78	$	86	$	164
Total long-term debt(2)(3)	14,971		—		15,123		496		15,619
SDG&E:
Total long-term debt(3)(4)	$	4,493	$	—	$	4,546	$	302	$	4,848
SoCalGas:
Total long-term debt(5)	$	3,009	$	—	$	3,121	$	—	$	3,121

	December 31, 2016
	Carrying amount		Fair value
	Carrying amount		Level 1		Level 2		Level 3		Total
Sempra Energy Consolidated:
Long-term amounts due from unconsolidated affiliates(1)	$	184	$	—	$	91	$	84	$	175
Total long-term debt(2)(3)	15,068		—		15,455		492		15,947
SDG&E:
Total long-term debt(3)(4)	$	4,654	$	—	$	4,727	$	305	$	5,032
SoCalGas:
Total long-term debt(5)	$	3,009	$	—	$	3,131	$	—	$	3,131


(1)	Excluding accumulated interest outstanding of $19 million and $17 million at March 31, 2017 and December 31, 2016, respectively.

(2)


(3)	Level 3 instruments include $302 million and $305 million at March 31, 2017 and December 31, 2016, respectively, related to Otay Mesa VIE.


(4)	Before reductions for unamortized discount and debt issuance costs of $43 million and $45 million at March 31, 2017 and December 31, 2016, respectively, and excluding capital lease obligations of $239 million and $240 million at March 31, 2017 and December 31, 2016, respectively.

(5)

Before reductions for unamortized discount and debt issuance costs of $26 million and $27 million at March 31, 2017 and December 31, 2016, respectively.

SAN ONOFRE NUCLEAR GENERATING STATION (SONGS) (Tables)

3 Months Ended

Mar. 31, 2017

Public Utilities, General Disclosures [Abstract]

Schedule of Nuclear Decommissioning Trusts Investments

The following table shows the fair values and gross unrealized gains and losses for the securities held in the NDT. We provide additional fair value disclosures for the NDT in Note 8.



NUCLEAR DECOMMISSIONING TRUSTS
(Dollars in millions)
	Cost		Gross unrealized gains		Gross unrealized losses			Estimated fair value
At March 31, 2017:
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies(1)	$	51	$	—	$	—		$	51
Municipal bonds(1)	216		6		(1		)	221
Other securities(2)	166		2		(1		)	167
Total debt securities	433		8		(2		)	439
Equity securities	255		358		(2		)	611
Cash and cash equivalents	12		—		—			12
Total	$	700	$	366	$	(4	)	$	1,062
At December 31, 2016:
Debt securities:
Debt securities issued by the U.S. Treasury and other
U.S. government corporations and agencies	$	52	$	—	$	—		$	52
Municipal bonds	203		4		(1		)	206
Other securities	141		2		(2		)	141
Total debt securities	396		6		(3		)	399
Equity securities	143		366		(1		)	508
Cash and cash equivalents	119		—		—			119
Total	$	658	$	372	$	(4	)	$	1,026


(1)	Maturity dates are 2017-2047.


(2)	Maturity dates are 2017-2066.

Schedule of Sales of Securities By Nuclear Decommissioning Trusts

The following table shows the proceeds from sales of securities in the NDT and gross realized gains and losses on those sales:



SALES OF SECURITIES
(Dollars in millions)
	Three months ended March 31,
	2017			2016
Proceeds from sales(1)	$	357		$	93
Gross realized gains	45			3
Gross realized losses	(5		)	(8		)

(1)

Excludes securities that are held to maturity.

Commitments and Contingencies Disclosure [Abstract]

Tabular disclosure of available-for-sale securities which includes, but is not limited to, changes in the cost basis and fair value, fair value and gross unrealized gain (loss), fair values by type of security, contractual maturity and classification, amortized cost basis, contracts to acquire securities to be accounted for as available-for-sale, debt maturities, transfers to trading, change in net unrealized holding gain (loss) net of tax, continuous unrealized loss position fair value, aggregate losses qualitative disclosures, other than temporary impairment (OTTI) losses or other disclosures related to available for sale securities.

+ References + Details

COMMITMENTS AND CONTINGENCIES (Tables)

3 Months Ended

Mar. 31, 2017

Schedule of Future Minimum Lease Payments for Capital Leases

Future minimum lease payments under the new power purchase agreement are as follows:



FUTURE MINIMUM PAYMENTS – POWER PURCHASE AGREEMENT
(Dollars in millions)
2017	$	—
2018	88
2019	105
2020	105
2021	105
Thereafter	1,706
Total minimum lease payments(1)	2,109
Less: interest(2)	(1,559		)
Present value of net minimum lease payments	$	550


(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.

SEGMENT INFORMATION (Tables)

3 Months Ended

Mar. 31, 2017

Segment Reporting [Abstract]

Segment Information



SEGMENT INFORMATION
(Dollars in millions)
	Three months ended March 31,
	2017			2016
REVENUES
SDG&E	$	1,057		$	991
SoCalGas	1,241			1,033
Sempra South American Utilities	412			400
Sempra Mexico	264			138
Sempra Renewables	22			7
Sempra LNG & Midstream	132			130
Intersegment revenues(1)	(97		)	(77		)
Total	$	3,031		$	2,622
INTEREST EXPENSE
SDG&E	$	49		$	48
SoCalGas	25			22
Sempra South American Utilities	9			9
Sempra Mexico	32			4
Sempra Renewables	4			—
Sempra LNG & Midstream	11			12
All other	68			72
Intercompany eliminations	(29		)	(24		)
Total	$	169		$	143
INTEREST INCOME
Sempra South American Utilities	$	5		$	5
Sempra Mexico	2			2
Sempra Renewables	1			1
Sempra LNG & Midstream	17			16
Intercompany eliminations	(19		)	(18		)
Total	$	6		$	6
DEPRECIATION AND AMORTIZATION
SDG&E	$	163		$	159
SoCalGas	126			122
Sempra South American Utilities	13			13
Sempra Mexico	36			17
Sempra Renewables	9			1
Sempra LNG & Midstream	10			13
All other	3			3
Total	$	360		$	328
INCOME TAX EXPENSE (BENEFIT)(2)
SDG&E	$	90		$	65
SoCalGas	98			83
Sempra South American Utilities	19			14
Sempra Mexico	142			40
Sempra Renewables	(11		)	(13		)
Sempra LNG & Midstream	1			(29		)
All other	(44		)	(52		)
Total	$	295		$	108



SEGMENT INFORMATION (CONTINUED)
(Dollars in millions)
	Three months ended March 31,
	2017			2016
EQUITY EARNINGS (LOSSES)
Earnings (losses) recorded before tax:
Sempra Renewables	$	2		$	7
Sempra LNG & Midstream	1			(29		)
Total	$	3		$	(22	)
Earnings (losses) recorded net of tax:
Sempra South American Utilities	$	1		$	2
Sempra Mexico	(9		)	15
Total	$	(8	)	$	17
EARNINGS (LOSSES)(2)
SDG&E	$	155		$	136
SoCalGas(3)	203			199
Sempra South American Utilities	47			38
Sempra Mexico	48			18
Sempra Renewables	11			14
Sempra LNG & Midstream	1			(32		)
All other	(24		)	(20		)
Total	$	441		$	353
EXPENDITURES FOR PROPERTY, PLANT & EQUIPMENT
SDG&E	$	418		$	329
SoCalGas	357			340
Sempra South American Utilities	43			43
Sempra Mexico	94			40
Sempra Renewables	69			181
Sempra LNG & Midstream	3			35
All other	8			3
Total	$	992		$	971
	March 31, 2017			December 31, 2016
ASSETS
SDG&E	$	17,900		$	17,719
SoCalGas	13,602			13,424
Sempra South American Utilities	3,729			3,591
Sempra Mexico	7,702			7,542
Sempra Renewables	2,282			3,644
Sempra LNG & Midstream	5,092			5,564
All other	644			475
Intersegment receivables	(2,667		)	(4,173		)
Total	$	48,284		$	47,786
EQUITY METHOD AND OTHER INVESTMENTS
Sempra South American Utilities	$	20		$	—
Sempra Mexico	212			180
Sempra Renewables	812			844
Sempra LNG & Midstream	999			997
All other	77			76
Total	$	2,120		$	2,097


(1)	Revenues for reportable segments include intersegment revenues of $1 million, $18 million, $25 million and $53 million for the three months ended March 31, 2017 and $3 million, $17 million, $27 million and $30 million for the three months ended March 31, 2016 for SDG&E, SoCalGas, Sempra Mexico and Sempra LNG & Midstream, respectively.


(2)	Amounts for the three months ended March 31, 2016 reflect the adoption of ASU 2016-09 as of January 1, 2016, as we discuss in Note 2.

(3)

After preferred dividends.

NEW ACCOUNTING STANDARDS (Details) - USD ($)
$ / shares in Units, shares in Thousands, $ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Dec. 31, 2016

Dec. 31, 2015

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Cumulative-effect adjustment

$ 107

Weighted-average number of shares outstanding, diluted

252,246

251,487

^[1]

$ (295)

$ (108)

^[1]

452

364

^[1],[2]

Basic earnings per common share (in dollars per share)

$ 441

$ 353

^[1]

$ 1.76

$ 1.41

^[1]

Diluted earnings per common share (in dollars per share)

$ 1.75

$ 1.40

^[1]

Increase in weighted-average common shares outstanding for diluted EPS (in shares)

252,246

251,487

^[1]

$ 515

$ 349

268

^[2]

(22)

^[2]

1,004

626

^[2]

(46)

$ 330

^[2]

Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

$ 76

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Weighted-average number of shares outstanding, diluted

251,487

$ (108)

364

Basic earnings per common share (in dollars per share)

$ 353

$ 1.41

Diluted earnings per common share (in dollars per share)

$ 1.40

Increase in weighted-average common shares outstanding for diluted EPS (in shares)

251,487

$ 349

626

As previously reported [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

$ 330

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Weighted-average number of shares outstanding, diluted

251,412

$ (142)

330

Basic earnings per common share (in dollars per share)

$ 319

$ 1.28

Diluted earnings per common share (in dollars per share)

$ 1.27

Increase in weighted-average common shares outstanding for diluted EPS (in shares)

251,412

$ 315

112

592

Effect of adoption [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

$ 364

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Weighted-average number of shares outstanding, diluted

$ 34

Basic earnings per common share (in dollars per share)

$ 34

$ 0.13

Diluted earnings per common share (in dollars per share)

$ 0.13

Increase in weighted-average common shares outstanding for diluted EPS (in shares)

$ 34

(34)

(34)

(34)

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Cumulative-effect adjustment

(90)

(65)

^[1]

157

137

^[1],[2]

155

136

^[1]

160

135

^[2]

(12)

(9)

^[2]

386

369

^[2]

(23)

^[2]

San Diego Gas and Electric Company [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

$ 12

(65)

137

136

135

San Diego Gas and Electric Company [Member] | As previously reported [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

(72)

130

129

128

San Diego Gas and Electric Company [Member] | Effect of adoption [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

(7)

New Accounting Pronouncements or Change in Accounting Principle [Line Items]

Cumulative-effect adjustment

$ 15

(98)

(83)

^[1]

^[1]

203

199

^[2]

203

199

^[2]

(5)

(7)

^[2]

463

241

^[2]

Southern California Gas Company [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

$ (62)

^[2]

(83)

199

Southern California Gas Company [Member] | As previously reported [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

(87)

195

Southern California Gas Company [Member] | Effect of adoption [Member] | Effect of Early Adoption of New Accounting Pronouncement [Member] | ASU 2016-09 [Member]

Schedule of Equity Method Investments [Line Items]

$ (4)

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[2]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

ACQUISITION AND DIVESTITURE ACTIVITY - ASSETS HELD FOR SALE (Details) - Sempra Mexico [Member] - TdM [Member] $ in Millions	1 Months Ended	3 Months Ended
	Feb. 29, 2016 MW	Mar. 31, 2017 USD ($)	Mar. 31, 2016 USD ($)
Assets Held for Sale [Line Items]
Power generating capacity \| MW	625
Deferred tax expense from the outside basis difference		$ 5	$ (29)
Disposal Group, Held-for-sale, Not Discontinued Operations [Member]
Assets Held for Sale, Assets [Abstract]
Cash		1
Inventories		11
Other current assets		31
Deferred income taxes		9
Property, plant and equipment, net		120
Other noncurrent assets		24
Total assets held for sale		196
Assets Held for Sale, Liabilities [Abstract]
Accounts payable		6
Other current liabilities		4
Asset retirement obligations		4
Other noncurrent liabilities		26
Total liabilities held for sale		$ 40

ACQUISITION AND DIVESTITURE ACTIVITY - DIVESTITURES (Details) - Sempra LNG & Midstream [Member] - Rockies Express [Member] - USD ($) $ in Millions	1 Months Ended		3 Months Ended
	May 31, 2016	Mar. 31, 2016	Mar. 31, 2016
Schedule of Equity Method Investments [Line Items]
Ownership percentage		25.00%	25.00%
Proceeds from sale of equity method investment	$ 443	$ 440
Carrying value of equity method investment		484	$ 484
Fair value of equity method investment		$ 440	440
Impairment of equity method investment			44
Impairment of equity method investment after-tax			$ 27

INVESTMENTS IN UNCONSOLIDATED ENTITIES (Details) - USD ($)
$ in Millions

1 Months Ended

3 Months Ended

Feb. 28, 2017

Mar. 31, 2017

Mar. 31, 2016

Equitization of note receivable due from unconsolidated affiliate

$ 19

$ 0

^[1]

Maximum exposure under guarantor obligations

4,400

Aggregate carrying value of guarantor obligations

Sempra Mexico [Member] | Infraestructura Marina del Golfo [Member]

Schedule of Equity Method Investments [Line Items]

Investments made during period

Joint Venture [Member] | Sempra South American Utilities [Member] | Eletrans [Member]

Schedule of Equity Method Investments [Line Items]

Equitization of note receivable due from unconsolidated affiliate

$ 19

Joint Venture [Member] | Sempra Renewables [Member]

Schedule of Equity Method Investments [Line Items]

Investments made during period

Joint Venture [Member] | Sempra LNG & Midstream [Member] | Cameron LNG [Member]

Schedule of Equity Method Investments [Line Items]

Investments made during period

Capitalized interest

$ 11

$ 12

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

OTHER FINANCIAL DATA - INVENTORIES (Details) - USD ($)
$ in Millions

Mar. 31, 2017

Dec. 31, 2016

$ 39

$ 92

159

157

210

258

^[1]

SDG&E [Member]

SoCalGas [Member]

Sempra South American Utilities [Member]

Sempra Mexico [Member]

Sempra Renewables [Member]

Sempra LNG & Midstream [Member]

$ 43

$ 58

^[1]

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - GREENHOUSE GAS (GHG) ALLOWANCES (Details) - USD ($)
$ in Millions

Mar. 31, 2017

Dec. 31, 2016

Greenhouse Gas Allowance [Member]

$ 3,503

$ 3,414

^[1]

307

295

Greenhouse Gas Obligation [Member]

347

335

Regulatory LIabilities [Abstract]

Other current liabilities

183

171

Total liabilities

223

211

^[1]

San Diego Gas and Electric Company [Member] | Greenhouse Gas Allowance [Member]

1,018

998

^[1]

184

182

San Diego Gas and Electric Company [Member] | Greenhouse Gas Obligation [Member]

200

198

Regulatory LIabilities [Abstract]

Other current liabilities

Total liabilities

^[1]

Southern California Gas Company [Member] | Greenhouse Gas Allowance [Member]

661

589

^[1]

119

109

Southern California Gas Company [Member] | Greenhouse Gas Obligation [Member]

143

133

Regulatory LIabilities [Abstract]

Other current liabilities

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Total liabilities

$ 123

$ 120

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - GOODWILL (Details) - USD ($)
$ in Millions

Mar. 31, 2017

Dec. 31, 2016

Goodwill

$ 2,380

$ 2,364

^[1]

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - VARIABLE INTEREST ENTITIES (Details)
$ in Millions

3 Months Ended

Mar. 31, 2017

USD ($)

Mar. 31, 2016

USD ($)

Dec. 31, 2016

USD ($)

$ 33,492

$ 32,931

^[1]

Energy-related businesses

2,285

2,270

^[1]

333

$ 180

^[2]

(714)

(701)

^[2]

(360)

(328)

^[2],[3]

Income before income taxes

(169)

(143)

^[2]

755

455

^[2]

(295)

(108)

^[2]

452

364

^[2],[3]

(11)

^[2]

441

353

^[2]

Otay Mesa VIE [Member]

Sempra Renewables [Member] | Tax Equity Investors [Member]

342

354

918

926

Energy-related businesses

464

468

(2)

Income before income taxes

(8)

(2)

Sempra Natural Gas [Member] | Cameron LNG Holdings [Member]

Investments [Abstract]

Carrying value of equity method investment

999

997

13,467

13,250

^[1]

^[1]

227

246

^[2]

163

159

^[2],[3]

278

236

^[2]

Income before income taxes

(49)

(48)

^[2]

247

202

^[2]

(90)

(65)

^[2]

157

137

^[2],[3]

San Diego Gas and Electric Company [Member] | Otay Mesa VIE [Member]

$ (2)

(1)

^[2]

Power generating capacity | MW

605

Conditional purchase obligation

$ 280

Equity of variable interest entity

Secured debt of variable interest entity

302

Cost of electric fuel and purchased power

342

$ 354

(18)

(17)

Total operating expenses

(7)

(6)

(5)

(2)

(1)

Organization, Consolidation and Presentation of Financial Statements [Abstract]

$ 0

[1]	Derived from audited financial statements.
[2]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.
[3]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

OTHER FINANCIAL DATA - PENSION AND OTHER POSTRETIREMENT BENEFITS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Pension benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	$ 28	$ 28
Interest cost	37	40
Expected return on assets	(40)	(42)
Prior service cost (credit)	3	3
Actuarial loss (gain)	8	6
Regulatory adjustment	(12)	(28)
Total net periodic benefit cost	24	7
Contributions by employer	26
Expected contributions in current fiscal year	181
Pension benefits [Member] \| San Diego Gas and Electric Company [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	8	7
Interest cost	9	10
Expected return on assets	(11)	(12)
Prior service cost (credit)	0	0
Actuarial loss (gain)	2	3
Regulatory adjustment	(7)	(7)
Total net periodic benefit cost	1	1
Contributions by employer	2
Expected contributions in current fiscal year	38
Pension benefits [Member] \| Southern California Gas Company [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	18	17
Interest cost	24	25
Expected return on assets	(26)	(25)
Prior service cost (credit)	2	2
Actuarial loss (gain)	4	3
Regulatory adjustment	(5)	(21)
Total net periodic benefit cost	17	1
Contributions by employer	17
Expected contributions in current fiscal year	90
Other postretirement benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	6	5
Interest cost	9	11
Expected return on assets	(16)	(17)
Prior service cost (credit)	0	0
Actuarial loss (gain)	(1)	0
Regulatory adjustment	2	2
Total net periodic benefit cost	0	1
Contributions by employer	1
Expected contributions in current fiscal year	8
Other postretirement benefits [Member] \| San Diego Gas and Electric Company [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	1	1
Interest cost	2	2
Expected return on assets	(3)	(3)
Prior service cost (credit)	1	1
Actuarial loss (gain)	0	0
Regulatory adjustment	(1)	(1)
Total net periodic benefit cost	0	0
Contributions by employer	0
Expected contributions in current fiscal year	4
Other postretirement benefits [Member] \| Southern California Gas Company [Member]
Defined Benefit Plan Disclosure [Line Items]
Service cost	4	4
Interest cost	7	8
Expected return on assets	(13)	(14)
Prior service cost (credit)	(1)	(1)
Actuarial loss (gain)	0	0
Regulatory adjustment	3	3
Total net periodic benefit cost	0	$ 0
Contributions by employer	0
Expected contributions in current fiscal year	$ 1

OTHER FINANCIAL DATA - RABBI TRUST (Details) - USD ($)
$ in Millions

Mar. 31, 2017

Dec. 31, 2016

Rabbi trust

$ 412

$ 430

^[1]

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - EARNINGS PER SHARE (EPS) (Details) - USD ($)
$ / shares in Units, $ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]

Weighted-average common shares outstanding for basic EPS (in shares)

$ 441

$ 353

^[1]

251,131,000

249,734,000

^[1]

Vested RSUs included in basic WASO

600

555

Dilutive effect of stock options, restricted stock awards and restricted stock units (in shares)

1,115,000

1,753,000

Weighted-average common shares outstanding for diluted EPS (in shares)

252,246,000

251,487,000

^[1]

Basic earnings per common share (in dollars per share)

$ 1.76

$ 1.41

^[1]

Diluted earnings per common share (in dollars per share)

$ 1.75

$ 1.40

^[1]

Antidilutive securities excluded from earnings per share

6,801

Performance-based RSUs [Member]

Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]

Equity awards, granted (in shares)

424,360

Service-based RSUs [Member]

Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]

Equity awards, granted (in shares)

92,413

IENova Plans [Member] | RSUs [Member]

Deferred Compensation Arrangement with Individual, Share-based Payments [Line Items]

Equity awards, granted (in shares)

1,034,086

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

OTHER FINANCIAL DATA - CAPITALIZED FINANCING COSTS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Capitalized Financing Costs Disclosure [Line Items]
Total capitalized financing costs	$ 82	$ 52
San Diego Gas and Electric Company [Member]
Capitalized Financing Costs Disclosure [Line Items]
Total capitalized financing costs	20	15
Southern California Gas Company [Member]
Capitalized Financing Costs Disclosure [Line Items]
Total capitalized financing costs	$ 15	$ 13

OTHER FINANCIAL DATA - CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

Other comprehensive income (loss), before reclassifications

$ (748)

^[1]

$ (806)

(14)

Amounts reclassified from accumulated other comprehensive income

(1)

(15)

Foreign currency translation adjustments [Member]

(696)

(821)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

Other comprehensive income (loss), before reclassifications

(527)

(582)

Amounts reclassified from accumulated other comprehensive income

Financial instruments [Member]

(481)

(514)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

Other comprehensive income (loss), before reclassifications

(125)

(137)

(2)

(82)

Amounts reclassified from accumulated other comprehensive income

(2)

(84)

Pension and other postretirement benefits [Member]

(121)

(221)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

Other comprehensive income (loss), before reclassifications

(96)

(87)

Amounts reclassified from accumulated other comprehensive income

(94)

(86)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

Amounts reclassified from accumulated other comprehensive income

(8)

^[1]

(8)

San Diego Gas and Electric Company [Member] | Pension and other postretirement benefits [Member]

(8)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

(8)

(8)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

(22)

^[1]

(19)

Southern California Gas Company [Member] | Financial instruments [Member]

(22)

(19)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

(13)

(14)

Southern California Gas Company [Member] | Pension and other postretirement benefits [Member]

(13)

(14)

AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward]

(9)

(5)

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

$ (9)

$ (5)

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Equity earnings (losses), before income tax

$ (169)

$ (143)

^[1]

(22)

^[1]

Equity (losses) earnings, net of income tax

(8)

^[1]

Revenues: Energy-Related Businesses

333

180

^[1]

Income before income taxes and equity (losses) earnings of certain unconsolidated subsidiaries

755

455

^[1]

Income Tax Expense

(295)

(108)

^[1]

(11)

^[1]

Earnings (losses)

441

353

^[1]

Gains (Losses) on Cash Flow hedges Attributable to Parent [Member]

(1)

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Gain (Loss) on Pension and Other Postretirement Benefits [Member]

(2)

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification from AOCI

Pension and Other Postretirement Benefits [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

(1)

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Income before income taxes and equity (losses) earnings of certain unconsolidated subsidiaries

Income Tax Expense

(4)

Net of income tax

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges [Member] | Interest rate and foreign exchange instruments [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Equity (losses) earnings, net of income tax

(3)

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges [Member] | Foreign exchange instruments [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Revenues: Energy-Related Businesses

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges [Member] | Interest rate instruments [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Equity earnings (losses), before income tax

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges [Member] | Commodity contracts not subject to rate recovery [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Revenues: Energy-Related Businesses

(7)

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges Attributable to Noncontrolling Interests [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges Attributable to Parent [Member]

(2)

(3)

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Earnings (losses)

(2)

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Income before income taxes and equity (losses) earnings of certain unconsolidated subsidiaries

(49)

(48)

^[1]

247

202

^[1]

Income Tax Expense

(90)

(65)

^[1]

(2)

(1)

^[1]

San Diego Gas and Electric Company [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges [Member] | Interest rate instruments [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

San Diego Gas and Electric Company [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Gains (Losses) on Cash Flow hedges Attributable to Noncontrolling Interests [Member]

Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]

Increase (Decrease) in Stockholders' Equity [Roll Forward]

$ (3)

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

OTHER FINANCIAL DATA - SHAREHOLDER'S EQUITY AND NONCONTROLLING INTEREST (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Dec. 31, 2015

$ 15,241

^[1]

$ 12,579

Cumulative-effect adjustment from change in accounting principle

^[1]

12,951

$ 107

Share-based compensation expense

515

349

(206)

(188)

(14)

(54)

(7)

(3)

15,569

12,831

Increase (Decrease) in Stockholders' Equity [Roll Forward]

13,264

Parent [Member]

Cumulative-effect adjustment from change in accounting principle

12,951

11,809

107

Share-based compensation expense

493

338

(206)

(188)

(14)

(54)

Noncontrolling Interest [Member]

13,264

12,053

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative-effect adjustment from change in accounting principle

2,290

770

Share-based compensation expense

(7)

(3)

2,305

778

Increase (Decrease) in Stockholders' Equity [Roll Forward]

5,678

^[1]

5,276

Cumulative-effect adjustment from change in accounting principle

^[1]

5,641

160

135

(175)

(3)

(1)

5,660

5,433

San Diego Gas and Electric Company [Member] | Parent [Member]

5,621

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative-effect adjustment from change in accounting principle

5,641

5,223

155

136

(175)

San Diego Gas and Electric Company [Member] | Noncontrolling Interest [Member]

5,621

5,382

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative-effect adjustment from change in accounting principle

(1)

(3)

(1)

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Cumulative-effect adjustment from change in accounting principle

3,510

^[1]

3,149

$ 15

203

199

$ 3,713

$ 3,363

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - OTHER NONCONTROLLING INTERESTS (Details) - USD ($)
$ in Millions

Mar. 31, 2017

Dec. 31, 2016

San Diego Gas and Electric Company [Member] | Otay Mesa VIE [Member]

$ 2,285

$ 2,270

^[1]

100.00%

Sempra South American Utilities [Member] | Chilquinta Energía subsidiaries [Member]

$ 39

$ 37

Sempra South American Utilities [Member] | Chilquinta Energía subsidiaries [Member] | Minimum [Member]

$ 23

$ 22

Sempra South American Utilities [Member] | Chilquinta Energía subsidiaries [Member] | Maximum [Member]

22.90%

23.10%

Sempra South American Utilities [Member] | Luz del Sur [Member]

43.40%

16.40%

Sempra South American Utilities [Member] | Tecsur [Member]

$ 182

$ 173

9.80%

Sempra Mexico [Member] | IEnova [Member]

$ 4

33.60%

Sempra Renewables [Member] | Tax equity arrangement – wind [Member]

$ 1,531

$ 1,524

Sempra Renewables [Member] | Tax equity arrangement – solar [Member]

Sempra LNG & Midstream [Member] | Bay Gas Storage Company, Ltd. [Member]

$ 371

$ 376

9.10%

Sempra LNG & Midstream [Member] | Liberty Gas Storage, LLC [Member]

$ 27

23.30%

Sempra LNG & Midstream [Member] | Southern Gas Transmission Company [Member]

$ 14

49.00%

$ 1

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - DUE TO DUE FROM AFFILIATES (Details) - USD ($)

3 Months Ended

12 Months Ended

Mar. 31, 2017

Dec. 31, 2016

$ 24,000,000

$ 26,000,000

^[1]

187,000,000

201,000,000

^[1]

Joint venture with PEMEX [Member]

$ (13,000,000)

(11,000,000)

^[1]

Joint venture with PEMEX [Member] | LIBOR [Member]

5.48%

Spread on variable rate

450.00%

ESJ joint venture [Member]

ESJ joint venture [Member] | LIBOR [Member]

7.36%

Spread on variable rate

637.50%

$ 0

4,000,000

^[1]

San Diego Gas and Electric Company [Member] | Due to/from Sempra Energy [Member]

(45,000,000)

(15,000,000)

^[1]

3,000,000

Income taxes due from Sempra Energy

(28,000,000)

109,000,000

159,000,000

San Diego Gas and Electric Company [Member] | Due to/from Other Affiliates [Member]

San Diego Gas and Electric Company [Member] | Due to/from SoCalGas [Member]

1,000,000

San Diego Gas and Electric Company [Member] | Due to/from Other affiliates [Member]

(9,000,000)

(8,000,000)

(8,000,000)

(7,000,000)

16,000,000

8,000,000

^[1]

Southern California Gas Company [Member] | Due to/from Sempra Energy [Member]

(28,000,000)

^[1]

7,000,000

Income taxes due to Sempra Energy

(28,000,000)

$ (13,000,000)

Income taxes due from Sempra Energy

$ 5,000,000

Loan to unconsolidated affiliate, principal

0.95%

0.68%

$ 35,000,000

$ 31,000,000

Southern California Gas Company [Member] | Due to/from SDG&E [Member]

Sempra South American Utilities [Member] | Eletrans [Member]

9,000,000

8,000,000

$ 82,000,000

96,000,000

Sempra South American Utilities [Member] | Due to/from Other affiliates [Member]

4.00%

Sempra Mexico [Member] | PEMEX Three year loan A [Member]

$ 1,000,000

1,000,000

Sempra Mexico [Member] | PEMEX Four year loan A [Member]

2,000,000

Sempra Mexico [Member] | PEMEX Four year loan B [Member]

44,000,000

Sempra Mexico [Member] | PEMEX Four year loan C [Member]

36,000,000

35,000,000

Sempra Mexico [Member] | ESJ joint venture [Member]

9,000,000

Allowance for equity funds used during construction

$ 13,000,000

$ 14,000,000

[1]	Derived from audited financial statements.

OTHER FINANCIAL DATA - AFFILIATES REVENUE AND COST OF SALES (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016
Related Party Transaction [Line Items]
Revenue from related parties	$ 7	$ 5
Costs of sales to related parties	14	30
San Diego Gas and Electric Company [Member]
Related Party Transaction [Line Items]
Revenue from related parties	2	3
Costs of sales to related parties	20	14
Southern California Gas Company [Member]
Related Party Transaction [Line Items]
Revenue from related parties	$ 18	$ 17

OTHER FINANCIAL DATA - OTHER INCOME (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Other Income [Line Items]

$ 72

$ 27

Investment gains

Gains on interest rate and foreign exchange instruments, net

Foreign currency transaction gains (losses)

(2)

Sale of other investments

Electrical infrastructure relocation income

Regulatory Interest, net

Sundry, net

169

^[1]

Allowance for equity funds used during construction

Other Income [Line Items]

Regulatory Interest, net

Sundry, net

^[1]

Allowance for equity funds used during construction

Other Income [Line Items]

Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items]

$ 11

$ 10

^[1]

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

OTHER FINANCIAL DATA - INCOME TAXES (Details) - USD ($)
$ in Millions

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Effective income tax rate

$ 295

$ 108

^[1]

39.00%

24.00%

Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items]

Effective income tax rate

$ 90

$ 65

^[1]

36.00%

32.00%

Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items]

Effective income tax rate

$ 98

$ 83

^[1]

33.00%

29.00%

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

DEBT AND CREDIT FACILITIES - LINES OF CREDIT (Details)	3 Months Ended
DEBT AND CREDIT FACILITIES - LINES OF CREDIT (Details)	Mar. 31, 2017 USD ($) lender line_of_credit	Dec. 31, 2016
Sempra Energy Consolidated [Member]
Line of Credit Facility [Line Items]
Weighted average interest rate on total short-term debt outstanding	1.60%	1.51%
Sempra U.S. Businesses [Member]
Line of Credit Facility [Line Items]
Number of primary lines of credit \| line_of_credit	3
Maximum borrowing capacity	$ 4,335,000,000
Total adjustment for combined limit	0
Available unused credit	2,730,000,000
Capacity for issuance of letters of credit	$ 400,000,000
Maximum ratio of indebtedness to total capitalization	65.00%
Foreign Operations [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 1,677,000,000
Amount outstanding	(601,000,000)
Available unused credit	1,076,000,000
Sempra Energy [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	1,000,000,000
Adjustment for combined limit	0
Available unused credit	935,000,000
Sempra Global [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	2,335,000,000
Total adjustment for combined limit	0
Available unused credit	1,138,000,000
California Utilities Combined [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	1,000,000,000
Limit on facility borrowings	(500,000,000)
Adjustment for combined limit	93,000,000
Total adjustment for combined limit	0
Limit on borrowings available	(407,000,000)
Available unused credit	657,000,000
Capacity for issuance of letters of credit	250,000,000
San Diego Gas and Electric Company [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	750,000,000
Adjustment for combined limit	0
Available unused credit	$ 407,000,000
Maximum ratio of indebtedness to total capitalization	65.00%
Weighted average interest rate on total short-term debt outstanding	1.00%
Southern California Gas Company [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 750,000,000
Adjustment for combined limit	(93,000,000)
Available unused credit	$ 657,000,000
Maximum ratio of indebtedness to total capitalization	65.00%
Weighted average interest rate on total short-term debt outstanding		0.75%
Sempra South American Utilities [Member] \| Peru [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	$ 392,000,000
Amount outstanding	(155,000,000)
Available unused credit	$ 237,000,000
Committed lines of credit, maximum ratio of debt to equity	170.00%
Bank guarantee	$ 12,000,000
Sempra South American Utilities [Member] \| Chile [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	115,000,000
Amount outstanding	0
Available unused credit	115,000,000
Sempra Mexico [Member]
Line of Credit Facility [Line Items]
Maximum borrowing capacity	1,170,000,000
Amount outstanding	(446,000,000)
Available unused credit	724,000,000
Commercial Paper [Member] \| Sempra U.S. Businesses [Member]
Line of Credit Facility [Line Items]
Amount outstanding	(1,540,000,000)
Commercial Paper [Member] \| Sempra Energy [Member]
Line of Credit Facility [Line Items]
Amount outstanding	0
Commercial Paper [Member] \| Sempra Global [Member]
Line of Credit Facility [Line Items]
Amount outstanding	(1,197,000,000)
Commercial Paper [Member] \| California Utilities Combined [Member]
Line of Credit Facility [Line Items]
Amount outstanding	(343,000,000)
Limit on facility borrowings	0
Commercial Paper [Member] \| San Diego Gas and Electric Company [Member]
Line of Credit Facility [Line Items]
Amount outstanding	(343,000,000)
Commercial Paper [Member] \| Southern California Gas Company [Member]
Line of Credit Facility [Line Items]
Amount outstanding	0
Letter of Credit [Member] \| Sempra U.S. Businesses [Member]
Line of Credit Facility [Line Items]
Amount outstanding	(65,000,000)
Letter of Credit [Member] \| Sempra Energy [Member]
Line of Credit Facility [Line Items]
Amount outstanding	(65,000,000)
Letter of Credit [Member] \| Sempra Global [Member]
Line of Credit Facility [Line Items]
Amount outstanding	0
Letter of Credit [Member] \| California Utilities Combined [Member]
Line of Credit Facility [Line Items]
Amount outstanding	0
Limit on facility borrowings	0
Letter of Credit [Member] \| San Diego Gas and Electric Company [Member]
Line of Credit Facility [Line Items]
Amount outstanding	0
Letter of Credit [Member] \| Southern California Gas Company [Member]
Line of Credit Facility [Line Items]
Amount outstanding	$ 0
Revolving Credit Facility [Member] \| Sempra Mexico [Member]
Line of Credit Facility [Line Items]
Term of debt instrument	5 years
Number of lenders \| lender	8

DEBT AND CREDIT FACILITIES - LONG TERM DEBT (Details) - South American Utilities [Member] - Luz Del Sur [Member] - Corporate Bonds Maturing in 2023 [Member] $ in Millions	Feb. 28, 2017 USD ($)
Debt Instrument [Line Items]
Debt amount offered and sold	$ 50
Stated rate of debt offered and sold	6.38%

DERIVATIVE FINANCIAL INSTRUMENTS - DERIVATIVE COMMODITY VOLUMES (Details) MWh in Millions, MMBTU in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2017 MWh MMBTU	Dec. 31, 2016 MWh MMBTU
SDG&E [Member] \| Natural gas [Member]
Derivatives, Fair Value [Line Items]
Net derivative energy volumes	44	48
SDG&E [Member] \| Electricity [Member]
Derivatives, Fair Value [Line Items]
Net derivative energy volumes \| MWh	4	4
SDG&E [Member] \| Congestion revenue rights [Member]
Derivatives, Fair Value [Line Items]
Net derivative energy volumes \| MWh	45	48
SoCalGas [Member] \| Natural gas [Member]
Derivatives, Fair Value [Line Items]
Net derivative energy volumes	0	1
Sempra LNG & Midstream [Member] \| Natural gas [Member]
Derivatives, Fair Value [Line Items]
Net derivative energy volumes	16	31

DERIVATIVE FINANCIAL INSTRUMENTS - DERIVATIVE NOTIONALS (Details) - USD ($) $ in Millions	3 Months Ended	12 Months Ended
	Mar. 31, 2017	Dec. 31, 2016
Cross currency swaps [Member]
Derivatives, Fair Value [Line Items]
Notional amount of derivative	$ 408	$ 408
Cross currency swaps [Member] \| Minimum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2017	Dec. 31, 2017
Cross currency swaps [Member] \| Maximum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2023	Dec. 31, 2023
Other foreign currency derivatives [Member]
Derivatives, Fair Value [Line Items]
Notional amount of derivative	$ 922	$ 86
Notional amount of derivatives acquired	$ 850
Other foreign currency derivatives [Member] \| Minimum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2017	Dec. 31, 2017
Other foreign currency derivatives [Member] \| Maximum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2018	Dec. 31, 2018
Cash Flow Hedging [Member] \| Interest rate instruments [Member]
Derivatives, Fair Value [Line Items]
Notional amount of derivative	$ 910	$ 924
Cash Flow Hedging [Member] \| Interest rate instruments [Member] \| Minimum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2017	Dec. 31, 2017
Cash Flow Hedging [Member] \| Interest rate instruments [Member] \| Maximum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2032	Dec. 31, 2032
San Diego Gas and Electric Company [Member] \| Cash Flow Hedging [Member] \| Interest rate instruments [Member]
Derivatives, Fair Value [Line Items]
Notional amount of derivative	$ 302	$ 305
San Diego Gas and Electric Company [Member] \| Cash Flow Hedging [Member] \| Interest rate instruments [Member] \| Minimum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2017	Dec. 31, 2017
San Diego Gas and Electric Company [Member] \| Cash Flow Hedging [Member] \| Interest rate instruments [Member] \| Maximum [Member]
Derivatives, Fair Value [Line Items]
Maturity date	Dec. 31, 2019	Dec. 31, 2019

DERIVATIVE FINANCIAL INSTRUMENTS - DERIVATIVE INSTRUMENTS ON THE CONDENSED BALANCE SHEET (Details) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	$ 132	$ 41
Additional cash collateral for commodity contracts not subject to rate recovery	9	10
Additional cash collateral for commodity contracts subject to rate recovery	20	32
Total	161	83
Other assets: Sundry [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	82	82
Additional cash collateral for commodity contracts not subject to rate recovery	0	0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	82	82
Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	(109)	(77)
Additional cash collateral for commodity contracts not subject to rate recovery	0	0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	(109)	(77)
Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	(303)	(364)
Additional cash collateral for commodity contracts not subject to rate recovery	0	0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	(303)	(364)
Designated as Hedging Instrument [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments	0	7
Commodity contracts not subject to rate recovery		0
Designated as Hedging Instrument [Member] \| Other assets: Sundry [Member]
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments	1	2
Commodity contracts not subject to rate recovery		0
Designated as Hedging Instrument [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments	(56)	(24)
Commodity contracts not subject to rate recovery		(14)
Designated as Hedging Instrument [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives designated as hedging instruments:
Interest rate and foreign exchange instruments	(155)	(228)
Commodity contracts not subject to rate recovery		0
Not Designated as Hedging Instrument [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Foreign exchange instruments	98
Commodity contracts not subject to rate recovery	67	248
Associated offsetting commodity contracts	(54)	(242)
Associated offsetting cash collateral		0
Commodity contracts subject to rate recovery	25	37
Associated offsetting commodity contracts	(4)	(9)
Associated offsetting cash collateral	0	0
Not Designated as Hedging Instrument [Member] \| Other assets: Sundry [Member]
Derivatives not designated as hedging instruments:
Foreign exchange instruments	0
Commodity contracts not subject to rate recovery	31	36
Associated offsetting commodity contracts	(21)	(27)
Associated offsetting cash collateral		(1)
Commodity contracts subject to rate recovery	71	73
Associated offsetting commodity contracts	0	(1)
Associated offsetting cash collateral	0	0
Not Designated as Hedging Instrument [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Foreign exchange instruments	0
Commodity contracts not subject to rate recovery	(60)	(254)
Associated offsetting commodity contracts	54	242
Associated offsetting cash collateral		16
Commodity contracts subject to rate recovery	(60)	(57)
Associated offsetting commodity contracts	4	9
Associated offsetting cash collateral	9	5
Not Designated as Hedging Instrument [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Foreign exchange instruments	0
Commodity contracts not subject to rate recovery	(21)	(28)
Associated offsetting commodity contracts	21	27
Associated offsetting cash collateral		1
Commodity contracts subject to rate recovery	(163)	(150)
Associated offsetting commodity contracts	0	1
Associated offsetting cash collateral	15	13
San Diego Gas and Electric Company [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	19	27
Additional cash collateral for commodity contracts not subject to rate recovery	1	1
Additional cash collateral for commodity contracts subject to rate recovery	19	30
Total	39	58
San Diego Gas and Electric Company [Member] \| Other assets: Sundry [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	71	72
Additional cash collateral for commodity contracts not subject to rate recovery	0	0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	71	72
San Diego Gas and Electric Company [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	(59)	(55)
Additional cash collateral for commodity contracts not subject to rate recovery	0	0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	(59)	(55)
San Diego Gas and Electric Company [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	(157)	(148)
Additional cash collateral for commodity contracts not subject to rate recovery	0	0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	(157)	(148)
San Diego Gas and Electric Company [Member] \| Designated as Hedging Instrument [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives designated as hedging instruments:
Interest rate instruments	0	0
San Diego Gas and Electric Company [Member] \| Designated as Hedging Instrument [Member] \| Other assets: Sundry [Member]
Derivatives designated as hedging instruments:
Interest rate instruments	0	0
San Diego Gas and Electric Company [Member] \| Designated as Hedging Instrument [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives designated as hedging instruments:
Interest rate instruments	(13)	(13)
San Diego Gas and Electric Company [Member] \| Designated as Hedging Instrument [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives designated as hedging instruments:
Interest rate instruments	(9)	(12)
San Diego Gas and Electric Company [Member] \| Not Designated as Hedging Instrument [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	23	33
Associated offsetting commodity contracts	(4)	(6)
Associated offsetting cash collateral	0	0
San Diego Gas and Electric Company [Member] \| Not Designated as Hedging Instrument [Member] \| Other assets: Sundry [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	71	73
Associated offsetting commodity contracts	0	(1)
Associated offsetting cash collateral	0	0
San Diego Gas and Electric Company [Member] \| Not Designated as Hedging Instrument [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	(59)	(51)
Associated offsetting commodity contracts	4	6
Associated offsetting cash collateral	9	3
San Diego Gas and Electric Company [Member] \| Not Designated as Hedging Instrument [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	(163)	(150)
Associated offsetting commodity contracts	0	1
Associated offsetting cash collateral	15	13
Southern California Gas Company [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	2	1
Additional cash collateral for commodity contracts not subject to rate recovery		1
Additional cash collateral for commodity contracts subject to rate recovery	1	2
Total	3	4
Southern California Gas Company [Member] \| Other assets: Sundry [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	0	0
Additional cash collateral for commodity contracts not subject to rate recovery		0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	0	0
Southern California Gas Company [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	(1)	(1)
Additional cash collateral for commodity contracts not subject to rate recovery		0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	(1)	(1)
Southern California Gas Company [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Net amounts presented on the balance sheet	0	0
Additional cash collateral for commodity contracts not subject to rate recovery		0
Additional cash collateral for commodity contracts subject to rate recovery	0	0
Total	0	0
Southern California Gas Company [Member] \| Not Designated as Hedging Instrument [Member] \| Current assets: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	2	4
Associated offsetting commodity contracts		(3)
Associated offsetting cash collateral		0
Southern California Gas Company [Member] \| Not Designated as Hedging Instrument [Member] \| Other assets: Sundry [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	0	0
Associated offsetting commodity contracts		0
Associated offsetting cash collateral		0
Southern California Gas Company [Member] \| Not Designated as Hedging Instrument [Member] \| Current liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	(1)	(6)
Associated offsetting commodity contracts		3
Associated offsetting cash collateral		2
Southern California Gas Company [Member] \| Not Designated as Hedging Instrument [Member] \| Deferred credits and other liabilities: Fixed-price contracts and other derivatives [Member]
Derivatives not designated as hedging instruments:
Commodity contracts subject to rate recovery	$ 0	0
Associated offsetting commodity contracts		0
Associated offsetting cash collateral		$ 0

DERIVATIVE FINANCIAL INSTRUMENTS - DERIVATIVE IMPACT ON THE INCOME (Details) - USD ($)

3 Months Ended

Mar. 31, 2017

Mar. 31, 2016

Derivative Instruments, Gain (Loss) [Line Items]

Fair Value Hedging [Member] | Interest Expense [Member] | Interest rate instruments [Member]

$ 106,000,000

$ (4,000,000)

^[1]

Derivative Instruments, Gain (Loss) [Line Items]

Hedge ineffectiveness

Cash Flow Hedging [Member] | Interest Expense [Member] | Interest rate instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Hedge ineffectiveness

Designated as Hedging Instrument [Member] | Fair Value Hedging [Member] | Interest Expense [Member] | Interest rate instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member]

2,000,000

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

(4,000,000)

(165,000,000)

(12,000,000)

(1,000,000)

Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Interest Expense [Member] | Interest rate and foreign exchange instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

16,000,000

(11,000,000)

3,000,000

(4,000,000)

Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Equity Earnings, Before Income Tax [Member] | Interest rate instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

(5,000,000)

(137,000,000)

(2,000,000)

(3,000,000)

Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Equity Earnings, Net of Income Tax [Member] | Interest rate and foreign exchange instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

(9,000,000)

(18,000,000)

(2,000,000)

(1,000,000)

Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Revenues: Energy- Related Businesses [Member] | Foreign exchange instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

(9,000,000)

(2,000,000)

Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Revenues: Energy- Related Businesses [Member] | Commodity contracts not subject to rate recovery [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

3,000,000

1,000,000

(9,000,000)

7,000,000

Not Designated as Hedging Instrument [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Not Designated as Hedging Instrument [Member] | Other Income, Net [Member] | Foreign exchange instruments [Member]

49,000,000

(9,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

Not Designated as Hedging Instrument [Member] | Equity Earnings, Net of Income Tax [Member] | Foreign exchange instruments [Member]

65,000,000

3,000,000

Derivative Instruments, Gain (Loss) [Line Items]

Not Designated as Hedging Instrument [Member] | Revenues: Energy- Related Businesses [Member] | Commodity contracts not subject to rate recovery [Member]

2,000,000

Derivative Instruments, Gain (Loss) [Line Items]

Not Designated as Hedging Instrument [Member] | Operation and Maintenance [Member] | Commodity contracts not subject to rate recovery [Member]

14,000,000

(1,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

Not Designated as Hedging Instrument [Member] | Cost of Electric Fuel and Purchased Power [Member] | Commodity contracts subject to rate recovery [Member]

(1,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

Not Designated as Hedging Instrument [Member] | Cost of Natural Gas [Member] | Commodity contracts subject to rate recovery [Member]

(29,000,000)

(12,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

(1,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

San Diego Gas and Electric Company [Member] | Cash Flow Hedging [Member] | Interest Expense [Member] | Interest rate instruments [Member]

1,000,000

^[1]

Derivative Instruments, Gain (Loss) [Line Items]

Hedge ineffectiveness

San Diego Gas and Electric Company [Member] | Designated as Hedging Instrument [Member] | Cash Flow Hedging [Member] | Interest Expense [Member] | Interest rate instruments [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Pretax gain (loss) reclassified from AOCI into earnings

(5,000,000)

(3,000,000)

San Diego Gas and Electric Company [Member] | Not Designated as Hedging Instrument [Member] | Cost of Electric Fuel and Purchased Power [Member] | Commodity contracts subject to rate recovery [Member]

Derivative Instruments, Gain (Loss) [Line Items]

Southern California Gas Company [Member] | Not Designated as Hedging Instrument [Member]

(29,000,000)

(12,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

Southern California Gas Company [Member] | Not Designated as Hedging Instrument [Member] | Operation and Maintenance [Member] | Commodity contracts not subject to rate recovery [Member]

(1,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

Southern California Gas Company [Member] | Not Designated as Hedging Instrument [Member] | Cost of Natural Gas [Member] | Commodity contracts subject to rate recovery [Member]

(1,000,000)

Derivative Instruments, Gain (Loss) [Line Items]

Jointly Owned Utility Plant Interests [Line Items]

$ 0

$ (1,000,000)

[1]	As adjusted for the adoption of ASU 2016-09 as of January 1, 2016.

DERIVATIVE FINANCIAL INSTRUMENTS - CASH FLOW HEDGES (Details) $ in Millions	3 Months Ended
	Mar. 31, 2017 USD ($)
Derivative Instruments, Gain (Loss) [Line Items]
Losses on cash flow hedges to be reclassified from AOCI within 12 months	$ 12
Maximum remaining term of cash flow hedges	15 years
San Diego Gas and Electric Company [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Maximum remaining term of cash flow hedges	2 years
Southern California Gas Company [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Losses on cash flow hedges to be reclassified from AOCI within 12 months	$ 0
Equity Method Investee [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Maximum remaining term of cash flow hedges	18 years
Noncontrolling Interest [Member] \| Otay Mesa VIE [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Losses on cash flow hedges to be reclassified from AOCI within 12 months	$ 11

DERIVATIVE FINANCIAL INSTRUMENTS - DERIVATIVE INSTRUMENTS WITH CONTINGENT FEATURES (Details) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Derivative Instruments, Gain (Loss) [Line Items]
Net liability position for derivatives with credit limits	$ 7	$ 10
Additional collateral that wil be required if credit rating falls below investment grade	10
San Diego Gas and Electric Company [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Net liability position for derivatives with credit limits	1	$ 0
Additional collateral that wil be required if credit rating falls below investment grade	$ 4

FAIR VALUE MEASUREMENTS - RECURRING FAIR VALUE MEASURES (Details) - Recurring [Member] - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	$ 611	$ 508
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	51	52
Nuclear decommissioning trusts - Municipal bonds	221	206
Nuclear decommissioning trusts - Other securities	167	141
Nuclear decommissioning trusts - Total debt securities	439	399
Nuclear decommissioning trusts - Netting	0	0
Total nuclear decommissioning trusts	1,050	907
Derivative asset netting	29	41
Total	1,293	1,072
Derivative liability netting	(24)	(35)
Total	412	441
Interest rate and foreign exchange instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	99	9
Derivative asset netting	0	0
Derivative liabilities	211	252
Derivative liability netting	0	0
Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	32	24
Derivative asset netting	9	9
Derivative liabilities	6	10
Derivative liability netting	0	(17)
Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	112	132
Derivative asset netting	20	32
Derivative liabilities	195	179
Derivative liability netting	(24)	(18)
Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	606	508
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	40	36
Nuclear decommissioning trusts - Municipal bonds	0	0
Nuclear decommissioning trusts - Other securities	0	0
Nuclear decommissioning trusts - Total debt securities	40	36
Total nuclear decommissioning trusts	646	544
Total	646	545
Total	25	35
Level 1 [Member] \| Interest rate and foreign exchange instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Level 1 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	16
Level 1 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	1
Derivative liabilities	25	19
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	5	0
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	11	16
Nuclear decommissioning trusts - Municipal bonds	221	206
Nuclear decommissioning trusts - Other securities	167	141
Nuclear decommissioning trusts - Total debt securities	399	363
Total nuclear decommissioning trusts	404	363
Total	528	390
Total	225	271
Level 2 [Member] \| Interest rate and foreign exchange instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	99	9
Derivative liabilities	211	252
Level 2 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	23	15
Derivative liabilities	6	11
Level 2 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	2	3
Derivative liabilities	8	8
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	0	0
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	0	0
Nuclear decommissioning trusts - Municipal bonds	0	0
Nuclear decommissioning trusts - Other securities	0	0
Nuclear decommissioning trusts - Total debt securities	0	0
Total nuclear decommissioning trusts	0	0
Total	90	96
Total	186	170
Level 3 [Member] \| Interest rate and foreign exchange instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Level 3 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	0
Level 3 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	90	96
Derivative liabilities	186	170
San Diego Gas and Electric Company [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	611	508
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	51	52
Nuclear decommissioning trusts - Municipal bonds	221	206
Nuclear decommissioning trusts - Other securities	167	141
Nuclear decommissioning trusts - Total debt securities	439	399
Nuclear decommissioning trusts - Netting	0	0
Total nuclear decommissioning trusts	1,050	907
Derivative asset netting	20	31
Total	1,160	1,037
Derivative liability netting	(24)	(16)
Total	216	203
San Diego Gas and Electric Company [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	1	1
Derivative asset netting	1	1
San Diego Gas and Electric Company [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	109	129
Derivative asset netting	19	30
Derivative liabilities	194	178
Derivative liability netting	(24)	(16)
San Diego Gas and Electric Company [Member] \| Interest rate instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	22	25
Derivative liability netting	0	0
San Diego Gas and Electric Company [Member] \| Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	606	508
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	40	36
Nuclear decommissioning trusts - Municipal bonds	0	0
Nuclear decommissioning trusts - Other securities	0	0
Nuclear decommissioning trusts - Total debt securities	40	36
Total nuclear decommissioning trusts	646	544
Total	646	545
Total	25	17
San Diego Gas and Electric Company [Member] \| Level 1 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
San Diego Gas and Electric Company [Member] \| Level 1 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	1
Derivative liabilities	25	17
San Diego Gas and Electric Company [Member] \| Level 1 [Member] \| Interest rate instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	0	0
San Diego Gas and Electric Company [Member] \| Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	5	0
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	11	16
Nuclear decommissioning trusts - Municipal bonds	221	206
Nuclear decommissioning trusts - Other securities	167	141
Nuclear decommissioning trusts - Total debt securities	399	363
Total nuclear decommissioning trusts	404	363
Total	404	365
Total	29	32
San Diego Gas and Electric Company [Member] \| Level 2 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
San Diego Gas and Electric Company [Member] \| Level 2 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	2
Derivative liabilities	7	7
San Diego Gas and Electric Company [Member] \| Level 2 [Member] \| Interest rate instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	22	25
San Diego Gas and Electric Company [Member] \| Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Nuclear decommissioning trusts - equity securities	0	0
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	0	0
Nuclear decommissioning trusts - Municipal bonds	0	0
Nuclear decommissioning trusts - Other securities	0	0
Nuclear decommissioning trusts - Total debt securities	0	0
Total nuclear decommissioning trusts	0	0
Total	90	96
Total	186	170
San Diego Gas and Electric Company [Member] \| Level 3 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
San Diego Gas and Electric Company [Member] \| Level 3 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	90	96
Derivative liabilities	186	170
San Diego Gas and Electric Company [Member] \| Level 3 [Member] \| Interest rate instruments [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	0	0
Southern California Gas Company [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative asset netting	1	3
Total	3	4
Derivative liability netting	0	(2)
Total	1	1
Southern California Gas Company [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets		1
Derivative asset netting		1
Southern California Gas Company [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	3	3
Derivative asset netting	1	2
Derivative liabilities	1	1
Derivative liability netting	0	(2)
Southern California Gas Company [Member] \| Level 1 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	0	0
Total	0	2
Southern California Gas Company [Member] \| Level 1 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets		0
Southern California Gas Company [Member] \| Level 1 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	0	2
Southern California Gas Company [Member] \| Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	2	1
Total	1	1
Southern California Gas Company [Member] \| Level 2 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets		0
Southern California Gas Company [Member] \| Level 2 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	2	1
Derivative liabilities	1	1
Southern California Gas Company [Member] \| Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total	0	0
Total	0	0
Southern California Gas Company [Member] \| Level 3 [Member] \| Commodity contracts not subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets		0
Southern California Gas Company [Member] \| Level 3 [Member] \| Commodity contracts subject to rate recovery [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	0	0
Derivative liabilities	$ 0	$ 0

FAIR VALUE MEASUREMENTS - RECON OF LEVEL 3 ASSETS (Details) - USD ($)	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2017	Dec. 31, 2016
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]
Beginning of period	$ (74,000,000)	$ 19,000,000
Realized and unrealized losses	(13,000,000)	(1,000,000)
Settlements	(9,000,000)	(7,000,000)
End of period	(96,000,000)	11,000,000
Change in unrealized gains relating to instruments still held at the end of the period	(16,000,000)	$ (1,000,000)
Minimum [Member]
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]
Congestion revenue rights (in dollars per MWH)				$ (24)
Market electricity forward price inputs ( in dollars per MWH)	14.50
Maximum [Member]
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]
Congestion revenue rights (in dollars per MWH)				$ 10
Market electricity forward price inputs ( in dollars per MWH)	$ 43.25
Forecast [Member] \| Minimum [Member]
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]
Congestion revenue rights (in dollars per MWH)			$ (12)
Forecast [Member] \| Maximum [Member]
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward]
Congestion revenue rights (in dollars per MWH)			$ 7

FAIR VALUE MEASUREMENTS - FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Millions	Mar. 31, 2017	Dec. 31, 2016
Carrying amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term amounts due from unconsolidated affiliates	$ 168	$ 184
Total long-term debt	14,971	15,068
Accumulated interest outstanding	19	17
Unamortized discount (net of premium) and debt issuance costs	105	109
Build-to-suit and capital lease obligations	382	383
Carrying amount [Member] \| Otay Mesa VIE [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term debt, gross	302	305
Fair value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term amounts due from unconsolidated affiliates	164	175
Total long-term debt	15,619	15,947
Fair value [Member] \| Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term amounts due from unconsolidated affiliates	0	0
Total long-term debt	0	0
Fair value [Member] \| Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term amounts due from unconsolidated affiliates	78	91
Total long-term debt	15,123	15,455
Fair value [Member] \| Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-term amounts due from unconsolidated affiliates	86	84
Total long-term debt	496	492
San Diego Gas and Electric Company [Member] \| Carrying amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	4,493	4,654
Unamortized discount (net of premium) and debt issuance costs	43	45
Capital lease obligations	239	240
San Diego Gas and Electric Company [Member] \| Fair value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	4,848	5,032
San Diego Gas and Electric Company [Member] \| Fair value [Member] \| Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	0	0
San Diego Gas and Electric Company [Member] \| Fair value [Member] \| Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	4,546	4,727
San Diego Gas and Electric Company [Member] \| Fair value [Member] \| Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	302	305
Southern California Gas Company [Member] \| Carrying amount [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	3,009	3,009
Unamortized discount (net of premium) and debt issuance costs	26	27
Southern California Gas Company [Member] \| Fair value [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	3,121	3,131
Southern California Gas Company [Member] \| Fair value [Member] \| Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	0	0
Southern California Gas Company [Member] \| Fair value [Member] \| Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	3,121	3,131
Southern California Gas Company [Member] \| Fair value [Member] \| Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Total long-term debt	$ 0	$ 0

SAN ONOFRE NUCLEAR GENERATING STATION (SONGS) (Details) - USD ($)
$ in Millions

1 Months Ended

3 Months Ended

51 Months Ended

Mar. 13, 2017

Apr. 30, 2016

Mar. 31, 2017

Feb. 28, 2017

Dec. 31, 2016

^[1]

Settlement amount

$ 118

Percent of arbitration expenses reduction of award

95.00%

Settlement amount net of arbitration expense

$ 60

Anticipated term of dismantlement work

$ 3,503

$ 3,414

10 years

Environmental exit costs, anticipated cost

$ 1,062

1,062

1,026

$ 4,400

Sempra Energy [Member]

Jointly Owned Utility Plant Interests [Line Items]

Regulatory Asset, Amortization Period

10 years

Sempra Energy [Member] | Asset Retirement Obligation Costs [Member]

Jointly Owned Utility Plant Interests [Line Items]

Regulatory asset

$ 175

175

Regulatory asset, current

141

Jointly Owned Utility Plant Interests [Line Items]

Settlement amount

Settlement amount net of arbitration expense

Arbitration expense

Legal costs

Litigation settlement amount allocated to ratepayers and shareholders

$ 1

Regulatory asset, current

Regulatory Asset, Amortization Period

$ 1,018

998

10 years

Percent of dismantlement work expense

20.00%

Environmental exit costs, anticipated cost

$ 1,062

$ 1,026

$ 899

Authorized recovery amount, nuclear decommissioning trust funding

302

$ 84

San Diego Gas and Electric Company [Member] | Asset Retirement Obligation Costs [Member]

Jointly Owned Utility Plant Interests [Line Items]

Regulatory asset

175

Regulatory asset, current

Jointly Owned Nuclear Power Plant [Member] | Sempra Energy [Member]

$ 141

Jointly Owned Utility Plant Interests [Line Items]

Jointly owned utility plant, proportionate ownership share

20.00%

Loss from plant closure, after tax

$ 125

Jointly Owned Nuclear Power Plant [Member] | San Diego Gas and Electric Company [Member]

Jointly Owned Utility Plant Interests [Line Items]

Jointly owned utility plant, proportionate ownership share

20.00%

Loss from plant closure, after tax

$ 125

[1]	Derived from audited financial statements.

SAN ONOFRE NUCLEAR GENERATING STATION (SONGS) - NUCLEAR DECOMMISSIONING TRUSTS (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2017	Mar. 31, 2016	Dec. 31, 2016
Schedule of Available-for-sale Securities [Line Items]
Cost	$ 700		$ 658
Gross unrealized gains	366		372
Gross unrealized losses	(4)		(4)
Estimated fair value	1,062		1,026
Proceeds from sales	357	$ 93
Gross realized gains	45	3
Gross realized losses	(5)	$ (8)
Total debt securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Cost	433		396
Gross unrealized gains	8		6
Gross unrealized losses	(2)		(3)
Estimated fair value	439		399
U.S. government corporations and agencies [Member]
Schedule of Available-for-sale Securities [Line Items]
Cost	51		52
Gross unrealized gains	0		0
Gross unrealized losses	0		0
Estimated fair value	51		52
Municipal bonds [Member]
Schedule of Available-for-sale Securities [Line Items]
Cost	216		203
Gross unrealized gains	6		4
Gross unrealized losses	(1)		(1)
Estimated fair value	221		206
Other securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Cost	166		141
Gross unrealized gains	2		2
Gross unrealized losses	(1)		(2)
Estimated fair value	167		141
Equity securities [Member]
Schedule of Available-for-sale Securities [Line Items]
Cost	255		143
Gross unrealized gains	358		366
Gross unrealized losses	(2)		(1)
Estimated fair value	611		508
Cash and cash equivalents [Member]
Schedule of Available-for-sale Securities [Line Items]
Cost	12		119
Gross unrealized gains	0		0
Gross unrealized losses	0		0
Estimated fair value	$ 12		$ 119

REGULATORY MATTERS (Details) - USD ($) $ in Millions	3 Months Ended		12 Months Ended	24 Months Ended
REGULATORY MATTERS (Details) - USD ($) $ in Millions	Mar. 31, 2017	Jun. 30, 2016	Dec. 31, 2016	Dec. 31, 2019
San Diego Gas and Electric Company [Member]
Public Utilities, General Disclosures [Line Items]
Refund of 2015 memorandum account, After-tax		$ 9
Liability Associated With Tracked Income Tax Expense Differences	$ 3
San Diego Gas and Electric Company [Member] \| California Public Utilities Commission [Member] \| Capital Structure, Common Equity [Member]
Public Utilities, General Disclosures [Line Items]
Return on equity			10.30%
San Diego Gas and Electric Company [Member] \| Forecast [Member] \| California Public Utilities Commission [Member]
Public Utilities, General Disclosures [Line Items]
Reduced return on equity				10.20%
Southern California Gas Company [Member]
Public Utilities, General Disclosures [Line Items]
Refund of 2015 memorandum account, After-tax		$ 12
Liability Associated With Tracked Income Tax Expense Differences	$ 39
Southern California Gas Company [Member] \| California Public Utilities Commission [Member] \| Capital Structure, Common Equity [Member]
Public Utilities, General Disclosures [Line Items]
Return on equity			10.10%
Southern California Gas Company [Member] \| Forecast [Member] \| California Public Utilities Commission [Member]
Public Utilities, General Disclosures [Line Items]
Reduced return on equity				10.05%

COMMITMENTS AND CONTINGENCIES - LEGAL PROCEEDINGS (Details)

1 Months Ended

3 Months Ended

May 08, 2017

plaintiff

lawsuit

Mar. 13, 2017

USD ($)

Mar. 31, 2016

Feb. 28, 2017

USD ($)

Jan. 31, 2017

lawsuit

Sep. 30, 2016

USD ($)

Mar. 31, 2017

USD ($)

Bcf

lawsuit

Dec. 31, 2016

USD ($)

Oct. 21, 2016

Percent of arbitration expenses reduction of award

95.00%

$ 118,000,000

^[1]

$ 53,000,000

Aliso Canyon Natural Gas Storage Facility Gas Leak [Member]

$ 621,000,000

606,000,000

^[1]

49,000,000

Property Disputes [Member]

$ 621,000,000

Consolidated Class Action Complaints [Member]

Property Class Action [Member]

Complaints Filed by Public Entities [Member]

$ 8,500,000

Complaints Filed by Public Entities [Member] | Health Study [Member]

$ 1,000,000

Legal Reserves [Member]

Legal Reserves [Member] | Aliso Canyon Natural Gas Storage Facility Gas Leak [Member]

$ 18,000,000

5,000,000

San Diego Gas and Electric Company [Member] | Wildfire [Member]

$ 24,000,000

Regulatory assets arising from wildfire litigation costs

350,000,000

Portion of regulatory assets arising from wildfire litigation related to CPUC operations

349,000,000

Portion of regulatory assets arising from wildfire litigation related to FERC operations

1,000,000

Potential after-tax charge for nonrecovery of CPUC regulatory assets

207,000,000

San Diego Gas and Electric Company [Member] | Lawsuit Against MHI [Member]

Percent of arbitration expenses reduction of award

95.00%

San Diego Gas and Electric Company [Member] | Legal Reserves [Member]

11,000,000

49,000,000

53,000,000

^[1]

Southern California Gas Company [Member] | Aliso Canyon Natural Gas Storage Facility Gas Leak [Member]

621,000,000

$ 606,000,000

^[1]

Estimated costs related to temporary relocation (percentage)

$ 799,000,000

70.00%

Estimated costs related to controlling well and stopping leak and emissions (percentage)

20.00%

$ 49,000,000

Period of required climate reductions

621,000,000

Insurance proceeds

$ 173,000,000

20 years

Period of required regulatory climate reductions

100 years

Target emissions level (in metric tons) | t

9,000,000

Loss Contingency, Total Actual Emissions, Floor (in metric tons) | t

90,350

Loss Contingency, Total Actual Emissions, Ceiling (in metric tons) | t

108,950

Mitigation requirements (in metric tons) | t

109,000

Amount of natural gas released | Bcf

4.62

Storage facility capacity | Bcf

Proportion of total gas storage capacity (percentage)

63.00%

Net book value of Aliso Canyon facility

$ 550,000,000

Construction work in progress of new compressor station

225,000,000

Southern California Gas Company [Member] | Aliso Canyon Natural Gas Storage Facility Gas Leak [Member] | Subsequent Event [Member]

Number of plaintiffs | plaintiff

266

22,000

Southern California Gas Company [Member] | Aliso Canyon Natural Gas Storage Facility Gas Leak [Member] | Minimum [Member]

Liability insurance coverage

1,200,000,000

Environmental mitigation period

5 years

Southern California Gas Company [Member] | Aliso Canyon Natural Gas Storage Facility Gas Leak [Member] | Maximum [Member]

Liability insurance coverage

1,400,000,000

Environmental mitigation period

10 years

Southern California Gas Company [Member] | Damages from Product Defects [Member]

Maximum occupational safety and health fines

$ 75,000

Penalty assessments

233,500

Maximum other assessments in settlement of criminal complaint

$ 4,000,000

Southern California Gas Company [Member] | Legal Reserves [Member]

Southern California Gas Company [Member] | Legal Reserves [Member] | Aliso Canyon Natural Gas Storage Facility Gas Leak [Member]

5,000,000