DOCUMENT AND ENTITY INFORMATION
DOCUMENT AND ENTITY INFORMATION - shares | 6 Months Ended | |
Jun. 30, 2016 | Jul. 29, 2016 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | Sempra Energy | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Shares Outstanding | 249,801,432 | |
Entity Central Index Key | 1,032,208 | |
Trading Symbol | SRE |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 | |||
Current assets: | |||||
Cash and cash equivalents | $ 616,000,000 | $ 403,000,000 | [1] | ||
Restricted cash | 17,000,000 | 27,000,000 | [1] | ||
Accounts receivable - trade, net | 994,000,000 | 1,283,000,000 | [1] | ||
Accounts receivable - other | 140,000,000 | 190,000,000 | [1] | ||
Due from unconsolidated affiliates | 6,000,000 | 6,000,000 | [1] | ||
Income taxes receivable | 36,000,000 | 30,000,000 | [1] | ||
Inventories | 270,000,000 | 298,000,000 | [1] | ||
Regulatory balancing accounts, undercollected | 336,000,000 | 307,000,000 | [1] | ||
Fixed-price contracts and other derivatives, current assets | 65,000,000 | 80,000,000 | [1] | ||
Assets held for sale | 654,000,000 | 0 | [1] | ||
Other current assets | 207,000,000 | 267,000,000 | [1] | ||
Total current assets | 3,341,000,000 | 2,891,000,000 | [1] | ||
Other assets: | |||||
Restricted cash, noncurrent | 18,000,000 | 20,000,000 | [1] | ||
Due from unconsolidated affiliates | 192,000,000 | 186,000,000 | [1] | ||
Other regulatory assets | 3,353,000,000 | 3,273,000,000 | [1] | ||
Nuclear decommissioning trusts | 1,103,000,000 | 1,063,000,000 | [1] | ||
Investments | 2,267,000,000 | 2,905,000,000 | [1] | ||
Goodwill | 786,000,000 | 819,000,000 | [1] | ||
Other intangible assets | 399,000,000 | 404,000,000 | [1] | ||
Dedicated assets in support of certain benefit plans | 436,000,000 | 464,000,000 | [1] | ||
Insurance receivable for Aliso Canyon costs | 679,000,000 | 325,000,000 | [1] | ||
Sundry | 806,000,000 | 761,000,000 | [1] | ||
Total other assets | 10,039,000,000 | 10,220,000,000 | [1] | ||
Property, plant and equipment: | |||||
Property, plant and equipment | 39,756,000,000 | 38,200,000,000 | [1] | ||
Less accumulated depreciation and amortization | (10,261,000,000) | (10,161,000,000) | [1] | ||
Property, plant and equipment, net | 29,495,000,000 | 28,039,000,000 | [1] | ||
Total assets | 42,875,000,000 | 41,150,000,000 | [1] | ||
Current liabilities: | |||||
Short-term debt | 1,777,000,000 | 622,000,000 | [1] | ||
Accounts payable - trade | 1,140,000,000 | 1,133,000,000 | [1] | ||
Accounts payable - other | 101,000,000 | 142,000,000 | [1] | ||
Due to unconsolidated affiliates | 8,000,000 | 14,000,000 | [1] | ||
Dividends and interest payable | 314,000,000 | 303,000,000 | [1] | ||
Accrued compensation and benefits | 289,000,000 | 423,000,000 | [1] | ||
Regulatory balancing accounts, overcollected | 120,000,000 | 34,000,000 | [1] | ||
Current portion of long-term debt | 907,000,000 | 907,000,000 | [1] | ||
Fixed-price contracts and other derivatives, current liabilities | 54,000,000 | 56,000,000 | [1] | ||
Customer deposits | 150,000,000 | 153,000,000 | [1] | ||
Reserve for Aliso Canyon costs | 117,000,000 | 274,000,000 | [1] | ||
Liabilities held for sale | 222,000,000 | 0 | [1] | ||
Other current liabilities | 481,000,000 | 551,000,000 | [1] | ||
Total current liabilities | 5,680,000,000 | 4,612,000,000 | [1] | ||
Long-term debt | 13,178,000,000 | 13,134,000,000 | [1] | ||
Deferred Credits And Other Liabilities [Abstract] | |||||
Customer advances for construction | 152,000,000 | 149,000,000 | [1] | ||
Pension and other postretirement benefit obligations, net of plan assets | 1,171,000,000 | 1,152,000,000 | [1] | ||
Deferred income taxes, net noncurrent liabilities | 3,071,000,000 | 3,157,000,000 | [1] | ||
Deferred investment tax credits | 32,000,000 | 32,000,000 | [1] | ||
Regulatory liabilities arising from removal obligations | 2,891,000,000 | 2,793,000,000 | [1] | ||
Asset retirement obligations | 2,491,000,000 | 2,126,000,000 | [1] | ||
Fixed-price contracts and other derivatives, noncurrent liabilities | 262,000,000 | 240,000,000 | [1] | ||
Deferred credits and other | 1,384,000,000 | 1,176,000,000 | [1] | ||
Total deferred credits and other liabilities | 11,454,000,000 | 10,825,000,000 | [1] | ||
Commitments and contingencies (Note 11) | |||||
Equity: | |||||
Preferred stock | 0 | 0 | [1] | ||
Common stock | 2,681,000,000 | 2,621,000,000 | [1] | ||
Retained earnings | 9,952,000,000 | 9,994,000,000 | [1] | ||
Accumulated other comprehensive income (loss) | [2] | (852,000,000) | (806,000,000) | [1] | |
Total shareholders' equity | 11,781,000,000 | 11,809,000,000 | [1] | ||
Preferred stock of subsidiaries | 20,000,000 | 20,000,000 | [1] | ||
Other noncontrolling interests | 762,000,000 | 750,000,000 | [1] | ||
Total equity | 12,563,000,000 | 12,579,000,000 | [1] | ||
Total liabilities and equity | 42,875,000,000 | 41,150,000,000 | [1] | ||
San Diego Gas and Electric Company [Member] | |||||
Current assets: | |||||
Cash and cash equivalents | 8,000,000 | 20,000,000 | [1] | ||
Restricted cash | 17,000,000 | 23,000,000 | [1] | ||
Accounts receivable - trade, net | 310,000,000 | 331,000,000 | [1] | ||
Accounts receivable - other | 14,000,000 | 17,000,000 | [1] | ||
Due from unconsolidated affiliates | 163,000,000 | 1,000,000 | [1] | ||
Income taxes receivable | 33,000,000 | 1,000,000 | [1] | ||
Inventories | 71,000,000 | 75,000,000 | [1] | ||
Regulatory balancing accounts, undercollected | 336,000,000 | 307,000,000 | [1] | ||
Regulatory assets | 93,000,000 | 107,000,000 | [1] | ||
Fixed-price contracts and other derivatives, current assets | 39,000,000 | 53,000,000 | [1] | ||
Other current assets | 42,000,000 | 69,000,000 | [1] | ||
Total current assets | 1,126,000,000 | 1,004,000,000 | [1] | ||
Other assets: | |||||
Restricted cash, noncurrent | 3,000,000 | 0 | [1] | ||
Deferred taxes recoverable in rates | 938,000,000 | 914,000,000 | [1] | ||
Other regulatory assets | 933,000,000 | 977,000,000 | [1] | ||
Nuclear decommissioning trusts | 1,103,000,000 | 1,063,000,000 | [1] | ||
Sundry | 335,000,000 | 301,000,000 | [1] | ||
Total other assets | 3,312,000,000 | 3,255,000,000 | [1] | ||
Property, plant and equipment: | |||||
Property, plant and equipment | 17,000,000,000 | 16,458,000,000 | [1] | ||
Less accumulated depreciation and amortization | (4,399,000,000) | (4,202,000,000) | [1] | ||
Property, plant and equipment, net | 12,601,000,000 | 12,256,000,000 | [1] | ||
Total assets | 17,039,000,000 | 16,515,000,000 | [1] | ||
Current liabilities: | |||||
Short-term debt | 54,000,000 | 168,000,000 | [1] | ||
Accounts payable - trade | 375,000,000 | 377,000,000 | [1] | ||
Due to unconsolidated affiliates | 190,000,000 | 55,000,000 | [1] | ||
Interest payable | 40,000,000 | 39,000,000 | [1] | ||
Accrued compensation and benefits | 77,000,000 | 129,000,000 | [1] | ||
Accrued Franchise Fees | 31,000,000 | 66,000,000 | [1] | ||
Current portion of long-term debt | 191,000,000 | 50,000,000 | [1] | ||
Asset Retirement Obligation Current | 63,000,000 | 99,000,000 | [1] | ||
Fixed-price contracts and other derivatives, current liabilities | 37,000,000 | 51,000,000 | [1] | ||
Customer deposits | 72,000,000 | 72,000,000 | [1] | ||
Other current liabilities | 88,000,000 | 101,000,000 | [1] | ||
Total current liabilities | 1,218,000,000 | 1,207,000,000 | [1] | ||
Long-term debt | 4,681,000,000 | 4,455,000,000 | [1] | ||
Deferred Credits And Other Liabilities [Abstract] | |||||
Customer advances for construction | 50,000,000 | 46,000,000 | [1] | ||
Pension and other postretirement benefit obligations, net of plan assets | 221,000,000 | 212,000,000 | [1] | ||
Deferred income taxes, net noncurrent liabilities | 2,523,000,000 | 2,472,000,000 | [1] | ||
Deferred investment tax credits | 20,000,000 | 19,000,000 | [1] | ||
Regulatory liabilities arising from removal obligations | 1,743,000,000 | 1,629,000,000 | [1] | ||
Asset retirement obligations | 765,000,000 | 729,000,000 | [1] | ||
Fixed-price contracts and other derivatives, noncurrent liabilities | 98,000,000 | 106,000,000 | [1] | ||
Deferred credits and other | 406,000,000 | 364,000,000 | [1] | ||
Total deferred credits and other liabilities | 5,826,000,000 | 5,577,000,000 | [1] | ||
Commitments and contingencies (Note 11) | |||||
Equity: | |||||
Common stock | 1,338,000,000 | 1,338,000,000 | [1] | ||
Retained earnings | 3,947,000,000 | 3,893,000,000 | [1] | ||
Accumulated other comprehensive income (loss) | (8,000,000) | [2] | (8,000,000) | [1] | |
Total shareholders' equity | 5,277,000,000 | 5,223,000,000 | [1] | ||
Other noncontrolling interests | 37,000,000 | 53,000,000 | [1] | ||
Total equity | 5,314,000,000 | 5,276,000,000 | [1] | ||
Total liabilities and equity | 17,039,000,000 | 16,515,000,000 | [1] | ||
Southern California Gas Company [Member] | |||||
Current assets: | |||||
Cash and cash equivalents | 211,000,000 | 58,000,000 | [1] | ||
Accounts receivable - trade, net | 337,000,000 | 635,000,000 | [1] | ||
Accounts receivable - other | 82,000,000 | 99,000,000 | [1] | ||
Due from unconsolidated affiliates | 7,000,000 | 48,000,000 | [1] | ||
Income taxes receivable | 6,000,000 | 0 | [1] | ||
Inventories | 44,000,000 | 79,000,000 | [1] | ||
Regulatory assets | 8,000,000 | 7,000,000 | [1] | ||
Other current assets | 35,000,000 | 40,000,000 | [1] | ||
Total current assets | 730,000,000 | 966,000,000 | [1] | ||
Other assets: | |||||
Regulatory assets arising from pension obligations | 732,000,000 | 699,000,000 | [1] | ||
Other regulatory assets | 717,000,000 | 636,000,000 | [1] | ||
Insurance receivable for Aliso Canyon costs | 679,000,000 | 325,000,000 | [1] | ||
Sundry | 252,000,000 | 207,000,000 | [1] | ||
Total other assets | 2,380,000,000 | 1,867,000,000 | [1] | ||
Property, plant and equipment: | |||||
Property, plant and equipment | 14,910,000,000 | 14,171,000,000 | [1] | ||
Less accumulated depreciation and amortization | (4,934,000,000) | (4,900,000,000) | [1] | ||
Property, plant and equipment, net | 9,976,000,000 | 9,271,000,000 | [1] | ||
Total assets | 13,086,000,000 | 12,104,000,000 | [1] | ||
Current liabilities: | |||||
Accounts payable - trade | 277,000,000 | 422,000,000 | [1] | ||
Accounts payable - other | 63,000,000 | 76,000,000 | [1] | ||
Due to unconsolidated affiliates | 25,000,000 | 0 | [1] | ||
Income taxes payable | 0 | 3,000,000 | [1] | ||
Accrued compensation and benefits | 123,000,000 | 160,000,000 | [1] | ||
Regulatory balancing accounts, overcollected | 120,000,000 | 34,000,000 | [1] | ||
Current portion of long-term debt | 1,000,000 | 9,000,000 | [1] | ||
Customer deposits | 72,000,000 | 76,000,000 | [1] | ||
Reserve for Aliso Canyon costs | 117,000,000 | 274,000,000 | [1] | ||
Other current liabilities | 181,000,000 | 184,000,000 | [1] | ||
Total current liabilities | 979,000,000 | 1,238,000,000 | [1] | ||
Long-term debt | 2,981,000,000 | 2,481,000,000 | [1] | ||
Deferred Credits And Other Liabilities [Abstract] | |||||
Customer advances for construction | 102,000,000 | 103,000,000 | [1] | ||
Pension and other postretirement benefit obligations, net of plan assets | 749,000,000 | 716,000,000 | [1] | ||
Deferred income taxes, net noncurrent liabilities | 1,637,000,000 | 1,532,000,000 | [1] | ||
Deferred investment tax credits | 12,000,000 | 14,000,000 | [1] | ||
Regulatory liabilities arising from removal obligations | 1,149,000,000 | 1,145,000,000 | [1] | ||
Asset retirement obligations | 1,697,000,000 | 1,354,000,000 | [1] | ||
Deferred credits and other | 437,000,000 | 372,000,000 | [1] | ||
Total deferred credits and other liabilities | 5,783,000,000 | 5,236,000,000 | [1] | ||
Equity: | |||||
Preferred stock | 22,000,000 | 22,000,000 | [1] | ||
Common stock | 866,000,000 | 866,000,000 | [1] | ||
Retained earnings | 2,474,000,000 | 2,280,000,000 | [1] | ||
Accumulated other comprehensive income (loss) | (19,000,000) | [2] | (19,000,000) | [1] | |
Total shareholders' equity | 3,343,000,000 | 3,149,000,000 | [1] | ||
Total equity | 3,343,000,000 | 3,149,000,000 | [1] | ||
Total liabilities and equity | $ 13,086,000,000 | $ 12,104,000,000 | [1] | ||
[1] | Derived from audited financial statements. | ||||
[2] | All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests. |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parentheticals) - USD ($) shares in Millions, $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | |
Property, plant and equipment, net | $ 29,495 | $ 28,039 | [1] |
Long-term debt | $ 13,178 | $ 13,134 | [1] |
Shareholders' equity: | |||
Preferred stock, shares authorized | 50 | 50 | |
Preferred stock, shares issued | 0 | 0 | |
Common stock, shares authorized | 750 | 750 | |
Common stock, shares outstanding | 250 | 248 | |
Otay Mesa VIE [Member] | |||
Property, plant and equipment, net | $ 372 | $ 383 | |
Long-term debt | 298 | 303 | |
San Diego Gas and Electric Company [Member] | |||
Property, plant and equipment, net | 12,601 | 12,256 | [1] |
Long-term debt | $ 4,681 | $ 4,455 | [1] |
Shareholders' equity: | |||
Common stock, shares authorized | 255 | 255 | |
Common stock, shares outstanding | 117 | 117 | |
San Diego Gas and Electric Company [Member] | Otay Mesa VIE [Member] | |||
Property, plant and equipment, net | $ 372 | $ 383 | |
Long-term debt | 298 | 303 | |
Southern California Gas Company [Member] | |||
Property, plant and equipment, net | 9,976 | 9,271 | [1] |
Long-term debt | $ 2,981 | $ 2,481 | [1] |
Shareholders' equity: | |||
Common stock, shares authorized | 100 | 100 | |
Common stock, shares outstanding | 91 | 91 | |
[1] | Derived from audited financial statements. |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
REVENUES | |||||
Utilities | $ 1,994 | $ 2,133 | $ 4,436 | $ 4,555 | |
Energy-related businesses | 162 | 234 | 342 | 494 | |
Total revenues | 2,156 | 2,367 | 4,778 | 5,049 | |
Utilities [Abstract] | |||||
Cost of natural gas | (183) | (239) | (494) | (585) | |
Cost of electric fuel and purchased power | (561) | (498) | (1,076) | (979) | |
Energy-related businesses [Abstract] | |||||
Cost of natural gas, electric fuel and purchased power | (62) | (73) | (118) | (171) | |
Other cost of sales | (226) | (42) | (261) | (77) | |
Operation and maintenance | (727) | (713) | (1,428) | (1,371) | |
Depreciation and amortization | (314) | (307) | (642) | (610) | |
Franchise fees and other taxes | (96) | (96) | (207) | (203) | |
Plant closure adjustment | 0 | 0 | 0 | 21 | |
Gain on sale of equity interest and assets | 0 | 62 | 0 | 62 | |
Equity Earnings Losses Before Income Tax [Abstract] | |||||
Equity earnings (losses), before income tax | 14 | 27 | (8) | 46 | |
Other income (expense), net | 23 | 37 | 72 | 76 | |
Interest income | 6 | 10 | 12 | 17 | |
Interest expense | (142) | (139) | (285) | (273) | |
Income (loss) before income taxes and equity earnings of certain unconsolidated subsidiaries | (112) | 396 | 343 | 1,002 | |
Income tax expense (benefit) | (106) | 98 | 36 | 261 | |
Equity earnings, net of income tax | 33 | 22 | 50 | 37 | |
Net income (loss) | 27 | 320 | 357 | 778 | |
Losses (earnings) attributable to noncontrolling interests | (10) | (24) | (21) | (45) | |
Preferred dividends of subsidiary | (1) | (1) | (1) | (1) | |
Earnings (losses) | $ 16 | $ 295 | $ 335 | $ 732 | |
Basic earnings per common share: | |||||
Basic earnings per common share | $ 0.06 | $ 1.19 | $ 1.34 | $ 2.95 | |
Basic earnings per common share, weighted-average number of shares outstanding (thousands) | [1] | 250,096 | 248,108 | 249,915 | 247,916 |
Diluted earnings per common share: | |||||
Diluted earnings per common share | $ 0.06 | $ 1.17 | $ 1.33 | $ 2.91 | |
Diluted earnings per common share, weighted-average number of shares outstanding (thousands) | 251,938 | 251,491 | 251,686 | 251,264 | |
Dividends declared per share of common stock | $ 0.75 | $ 0.7 | $ 1.51 | $ 1.4 | |
San Diego Gas and Electric Company [Member] | |||||
Utility operating revenues | |||||
Electric | $ 897 | $ 874 | $ 1,740 | $ 1,679 | |
Natural gas | 95 | 98 | 243 | 259 | |
Total utility operating revenues | 992 | 972 | 1,983 | 1,938 | |
Utility operating expenses | |||||
Utility cost of electric fuel and purchased power | 314 | 251 | 562 | 479 | |
Utility cost of natural gas | 25 | 31 | 64 | 85 | |
Utility operation and maintenance | 266 | 255 | 512 | 472 | |
Utility depreciation and amortization | 158 | 149 | 317 | 294 | |
Utility franchise fees and other taxes | 59 | 59 | 122 | 120 | |
Utility plant closure adjustment | 0 | 0 | 0 | (21) | |
Total utility operating expenses | 822 | 745 | 1,577 | 1,429 | |
Utility operating income (loss) | 170 | 227 | 406 | 509 | |
Equity Earnings Losses Before Income Tax [Abstract] | |||||
Other income (expense), net | 13 | 9 | 27 | 18 | |
Interest expense | (48) | (52) | (96) | (104) | |
Income (loss) before income taxes and equity earnings of certain unconsolidated subsidiaries | 135 | 184 | 337 | 423 | |
Income tax expense (benefit) | 48 | 54 | 120 | 142 | |
Net income (loss) | 87 | 130 | 217 | 281 | |
Losses (earnings) attributable to noncontrolling interests | 13 | (4) | 12 | (8) | |
Earnings (losses) | 100 | 126 | 229 | 273 | |
Southern California Gas Company [Member] | |||||
Utility operating revenues | |||||
Total utility operating revenues | 617 | 780 | 1,650 | 1,828 | |
Utility operating expenses | |||||
Utility cost of natural gas | 147 | 196 | 400 | 463 | |
Utility operation and maintenance | 339 | 346 | 666 | 660 | |
Utility depreciation and amortization | 112 | 113 | 234 | 226 | |
Utility franchise fees and other taxes | 30 | 31 | 67 | 65 | |
Total utility operating expenses | 628 | 686 | 1,367 | 1,414 | |
Utility operating income (loss) | (11) | 94 | 283 | 414 | |
Equity Earnings Losses Before Income Tax [Abstract] | |||||
Other income (expense), net | 6 | 9 | 16 | 17 | |
Interest income | 0 | 3 | 0 | 3 | |
Interest expense | (24) | (19) | (46) | (38) | |
Income (loss) before income taxes and equity earnings of certain unconsolidated subsidiaries | (29) | 87 | 253 | 396 | |
Income tax expense (benefit) | (29) | 16 | 58 | 111 | |
Net income (loss) | 0 | 71 | 195 | 285 | |
Earnings (losses) | 0 | 71 | 195 | 285 | |
Preferred dividend requirements | (1) | (1) | (1) | (1) | |
Earnings (losses) attributable to common shares | $ (1) | $ 70 | $ 194 | $ 284 | |
[1] | Includes 568 and 501 average fully vested restricted stock units held in our Deferred Compensation Plan for the three months ended June 30, 2016 and 2015, respectively, and 562 and 476 of such units for the six months ended June 30, 2016 and 2015, 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. |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Net income | $ 27 | $ 320 | $ 357 | $ 778 |
Comprehensive income, net of income tax | ||||
Preferred dividends of subsidiary | (1) | (1) | (1) | (1) |
Before-Tax Amount [Member] | ||||
Net income | (89) | 394 | 372 | 994 |
Comprehensive income, net of income tax | ||||
Foreign currency translation adjustments | 11 | (43) | 79 | (105) |
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | (78) | 95 | (237) | 6 |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | 2 | 2 | 4 | 4 |
Other Comprehensive Income (Loss), Net of Tax, Total | (65) | 54 | (154) | (95) |
Total Comprehensive Income | (154) | 448 | 218 | 899 |
Preferred dividends of subsidiary | (1) | (1) | (1) | (1) |
Total comprehensive income, after preferred dividends of subsidiaries | (155) | 447 | 217 | 898 |
Income Tax (Expense) Benefit [Member] | ||||
Net income | 106 | (98) | (36) | (261) |
Comprehensive income, net of income tax | ||||
Foreign currency translation adjustments | 0 | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 35 | (36) | 110 | (2) |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | (1) | (1) | (2) | (2) |
Other Comprehensive Income (Loss), Net of Tax, Total | 34 | (37) | 108 | (4) |
Total Comprehensive Income | 140 | (135) | 72 | (265) |
Preferred dividends of subsidiary | 0 | 0 | 0 | 0 |
Total comprehensive income, after preferred dividends of subsidiaries | 140 | (135) | 72 | (265) |
Net-of-Tax Amount [Member] | ||||
Net income | 17 | 296 | 336 | 733 |
Comprehensive income, net of income tax | ||||
Foreign currency translation adjustments | 11 | (43) | 79 | (105) |
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | (43) | 59 | (127) | 4 |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | 1 | 1 | 2 | 2 |
Other Comprehensive Income (Loss), Net of Tax, Total | (31) | 17 | (46) | (99) |
Total Comprehensive Income | (14) | 313 | 290 | 634 |
Preferred dividends of subsidiary | (1) | (1) | (1) | (1) |
Total comprehensive income, after preferred dividends of subsidiaries | (15) | 312 | 289 | 633 |
Noncontrolling Interests [Member] | ||||
Net income | 10 | 24 | 21 | 45 |
Comprehensive income, net of income tax | ||||
Foreign currency translation adjustments | 0 | (5) | 5 | (13) |
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 1 | 6 | (4) | 1 |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | 0 | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Net of Tax, Total | 1 | 1 | 1 | (12) |
Total Comprehensive Income | 11 | 25 | 22 | 33 |
Preferred dividends of subsidiary | 0 | 0 | 0 | 0 |
Total comprehensive income, after preferred dividends of subsidiaries | 11 | 25 | 22 | 33 |
Total Equity [Member] | ||||
Net income | 27 | 320 | 357 | 778 |
Comprehensive income, net of income tax | ||||
Foreign currency translation adjustments | 11 | (48) | 84 | (118) |
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | (42) | 65 | (131) | 5 |
Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax | 1 | 1 | 2 | 2 |
Other Comprehensive Income (Loss), Net of Tax, Total | (30) | 18 | (45) | (111) |
Total Comprehensive Income | (3) | 338 | 312 | 667 |
Preferred dividends of subsidiary | (1) | (1) | (1) | (1) |
Total comprehensive income, after preferred dividends of subsidiaries | (4) | 337 | 311 | 666 |
San Diego Gas and Electric Company [Member] | ||||
Net income | 87 | 130 | 217 | 281 |
San Diego Gas and Electric Company [Member] | Before-Tax Amount [Member] | ||||
Net income | 148 | 180 | 349 | 415 |
Comprehensive income, net of income tax | ||||
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 0 | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Net of Tax, Total | 0 | 0 | 0 | 0 |
Total Comprehensive Income | 148 | 180 | 349 | 415 |
San Diego Gas and Electric Company [Member] | Income Tax (Expense) Benefit [Member] | ||||
Net income | (48) | (54) | (120) | (142) |
Comprehensive income, net of income tax | ||||
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 0 | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Net of Tax, Total | 0 | 0 | 0 | 0 |
Total Comprehensive Income | (48) | (54) | (120) | (142) |
San Diego Gas and Electric Company [Member] | Net-of-Tax Amount [Member] | ||||
Net income | 100 | 126 | 229 | 273 |
Comprehensive income, net of income tax | ||||
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 0 | 0 | 0 | 0 |
Other Comprehensive Income (Loss), Net of Tax, Total | 0 | 0 | 0 | 0 |
Total Comprehensive Income | 100 | 126 | 229 | 273 |
San Diego Gas and Electric Company [Member] | Noncontrolling Interests [Member] | ||||
Net income | (13) | 4 | (12) | 8 |
Comprehensive income, net of income tax | ||||
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 1 | 3 | (1) | 1 |
Other Comprehensive Income (Loss), Net of Tax, Total | 1 | 3 | (1) | 1 |
Total Comprehensive Income | (12) | 7 | (13) | 9 |
San Diego Gas and Electric Company [Member] | Total Equity [Member] | ||||
Net income | 87 | 130 | 217 | 281 |
Comprehensive income, net of income tax | ||||
Other Comprehensive Income (Loss), Derivatives Qualifying As Hedges, Net of Tax | 1 | 3 | (1) | 1 |
Other Comprehensive Income (Loss), Net of Tax, Total | 1 | 3 | (1) | 1 |
Total Comprehensive Income | 88 | 133 | 216 | 282 |
Southern California Gas Company [Member] | ||||
Net income | 0 | 71 | 195 | 285 |
Southern California Gas Company [Member] | Before-Tax Amount [Member] | ||||
Net income | (29) | 87 | 253 | 396 |
Comprehensive income, net of income tax | ||||
Total Comprehensive Income | (29) | 87 | 253 | 396 |
Southern California Gas Company [Member] | Income Tax (Expense) Benefit [Member] | ||||
Net income | 29 | (16) | (58) | (111) |
Comprehensive income, net of income tax | ||||
Total Comprehensive Income | 29 | (16) | (58) | (111) |
Southern California Gas Company [Member] | Net-of-Tax Amount [Member] | ||||
Net income | 0 | 71 | 195 | 285 |
Comprehensive income, net of income tax | ||||
Total Comprehensive Income | $ 0 | $ 71 | $ 195 | $ 285 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | ||
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net income | $ 357 | $ 778 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depreciation and amortization | 642 | 610 | |
Deferred income taxes and investment tax credits | (42) | 203 | |
Gain on sale of equity interest and assets | 0 | (62) | |
Plant closure adjustment | 0 | (21) | |
Equity earnings | (42) | (83) | |
Fixed-price contracts and other derivatives | 41 | 0 | |
Other | 33 | (8) | |
Net change in other working capital components | 167 | (116) | |
Insurance Receivable For Aliso Canyon Costs | (354) | 0 | |
Changes in other assets | (67) | (89) | |
Changes in other liabilities | 147 | 7 | |
Net cash provided by operating activities | 882 | 1,219 | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Expenditures for property, plant and equipment | (2,006) | (1,466) | |
Expenditures for investments | (46) | (161) | |
Proceeds from sale of assets | 443 | 347 | |
Distributions from investments | 12 | 9 | |
Purchases of nuclear decommissioning and other trust assets | (206) | (229) | |
Proceeds from sales by nuclear decommissioning and other trusts | 204 | 221 | |
Decrease in restricted cash | 44 | 49 | |
Increase in restricted cash | (32) | (34) | |
Advances to unconsolidated affiliates | (9) | (20) | |
Proceeds From Payments For Long Term Loans For Related Parties | 9 | 74 | |
Other cash flows from investing activities | (6) | 9 | |
Net cash used in investing activities | (1,593) | (1,201) | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Common dividends paid | (335) | (308) | |
Preferred dividends paid by subsidiaries | (1) | (1) | |
Proceeds from issuances of common stock | 29 | 31 | |
Repurchases of common stock | (54) | (66) | |
Issuances of long-term debt | 1,384 | 1,547 | |
Payments on long-term debt | (986) | (846) | |
Increase (decrease) in short-term debt, net | 865 | (339) | |
Distributions to noncontrolling interests | (10) | (14) | |
Excess Tax Benefit From Share Based Compensation Financing Activities | 34 | 52 | |
Other cash flows from financing activities | (10) | (6) | |
Net cash provided by (used in) financing activities | 916 | 50 | |
Effect of exchange rate changes on cash and cash equivalents | 8 | (2) | |
Increase (decrease) in cash and cash equivalents | 213 | 66 | |
Cash and cash equivalents, beginning of period | 403 | [1] | 570 |
Cash and cash equivalents, end of period | 616 | 636 | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||
Interest payments, net of amounts capitalized | 279 | 260 | |
Income tax payments, net of refunds | 73 | 72 | |
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||
Accrued capital expenditures | 541 | 302 | |
Redemption of industrial development bonds | 0 | 79 | |
Financing of build-to-suit property | 0 | 39 | |
Common dividends issued in stock | 27 | 27 | |
Dividends declared but not paid | 195 | 178 | |
Acquisition Of Business [Abstract] | |||
Assets acquired | 0 | 10 | |
Liabilities Assumed | 0 | (2) | |
Accrued purchase price | 0 | (6) | |
Cash paid | 0 | 2 | |
San Diego Gas and Electric Company [Member] | |||
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net income | 217 | 281 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Utility depreciation and amortization | 317 | 294 | |
Deferred income taxes and investment tax credits | 26 | 103 | |
Utility plant closure adjustment | 0 | (21) | |
Fixed-price contracts and other derivatives | (1) | (2) | |
Other | (21) | (9) | |
Net change in other working capital components | 0 | (40) | |
Changes in other assets | (39) | (59) | |
Changes in other liabilities | 9 | 3 | |
Net cash provided by operating activities | 508 | 550 | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Expenditures for property, plant and equipment | (602) | (600) | |
Purchases of nuclear decommissioning trust assets | (203) | (227) | |
Proceeds from sales by nuclear decommissioning trusts | 204 | 221 | |
Decrease in restricted cash | 24 | 19 | |
Increase in restricted cash | (21) | (19) | |
Increase (Decrease) in loans to affiliates, net | (172) | 0 | |
Net cash used in investing activities | (770) | (606) | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Issuances of long-term debt | 498 | 388 | |
Payments on long-term debt | (128) | (105) | |
Increase (decrease) in short-term debt, net | (114) | (206) | |
Distributions to noncontrolling interests | (3) | (6) | |
Other cash flows from financing activities | (3) | 0 | |
Net cash provided by (used in) financing activities | 250 | 71 | |
Increase (decrease) in cash and cash equivalents | (12) | 15 | |
Cash and cash equivalents, beginning of period | 20 | [1] | 8 |
Cash and cash equivalents, end of period | 8 | 23 | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||
Interest payments, net of amounts capitalized | 92 | 99 | |
Income tax payments, net of refunds | 125 | 99 | |
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||
Accrued capital expenditures | 124 | 118 | |
Dividends declared but not paid | 175 | 0 | |
Southern California Gas Company [Member] | |||
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net income | 195 | 285 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Utility depreciation and amortization | 234 | 226 | |
Deferred income taxes and investment tax credits | 32 | 76 | |
Other | 7 | (15) | |
Net change in other working capital components | 190 | (58) | |
Insurance Receivable For Aliso Canyon Costs | (354) | 0 | |
Changes in other assets | (54) | (30) | |
Changes in other liabilities | 12 | (1) | |
Net cash provided by operating activities | 262 | 483 | |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Expenditures for property, plant and equipment | (650) | (603) | |
Increase (Decrease) in loans to affiliates, net | 50 | (279) | |
Net cash used in investing activities | (600) | (882) | |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Preferred dividends paid | (1) | (1) | |
Issuances of long-term debt | 499 | 599 | |
Payments on long-term debt | (3) | 0 | |
Increase (decrease) in short-term debt, net | 0 | (50) | |
Other cash flows from financing activities | (4) | (3) | |
Net cash provided by (used in) financing activities | 491 | 545 | |
Increase (decrease) in cash and cash equivalents | 153 | 146 | |
Cash and cash equivalents, beginning of period | 58 | [1] | 85 |
Cash and cash equivalents, end of period | 211 | 231 | |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION | |||
Interest payments, net of amounts capitalized | 43 | 36 | |
Income tax payments, net of refunds | 35 | 14 | |
SUPPLEMENTAL DISCLOSURE OF NONCASH INVESTING AND FINANCING ACTIVITIES | |||
Accrued capital expenditures | $ 140 | $ 143 | |
[1] | Derived from audited financial statements. |
GENERAL
GENERAL | 6 Months Ended |
Jun. 30, 2016 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
General | SEMPRA ENERGY AND SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS NOTE 1. 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 San Diego Gas & Electric Company (SDG&E) and Southern California Gas Company ( SoCalGas ) , wh ich are separate, reportable segments; Sempra International, which includes our Sempra South American Utilities and Sempra Mexico reportable segments; and Sempra U.S. Gas & Power, which includes our Sempra Renewables and Sempra Natural Gas reportable segme nts. We provide descriptions of each of our segments in Note 12. We refer to SDG&E and SoCalGas collectively as the California Utilities, which do not include the utilities in our Sempra International and Sempra U.S. Gas & Power operating units. Sempra Glo bal is the holding company for most of our subsidiaries that are not subject to California utility regulation. All references in these Notes to “Sempra International,” “Sempra U.S. Gas & Power” and their respective reportable segments are not intended to r efer to any legal entity with the same or similar name. Our Sempra Mexico segment includes the operating companies of our subsidiary, Infraestructura Energética Nova, S.A.B. de C.V. ( IEnova ), as well as certain holding companies and risk management activit y. We discuss IEnova further in Note 1 of the Notes to Consolidated Financial Statements in our Annual Report on Form 10-K for the year ended December 31, 2015 (the Annual Report), which includes the combined reports for Sempra Energy, SDG&E and SoCalGas . 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 discuss our investments in unconsolidated entities in Notes 3 and 4 herein and in Notes 3, 4 and 10 of the Notes to Consolidated Financial Statements in the Annual Report. 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 N ote 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 refe r 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 So CalGas . We have prepared the Condensed Consolidated Financial Statements in conf ormity 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 resu lts for the entire year. We evaluated events and transactions that occurred after June 30, 2016 through the date the financial statements were issued and , in the opinion of management, the accompanying statements reflect all adjustments necessary for a fai r presentation. These adjustments are only of a normal, recurring nature. All December 31, 2015 balance sheet information in the Condensed Consolidated Financial Statements has been derived from our audited 2015 Consolidated Financial Statements in the An nual 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 informatio n in this Quarterly Report in conjunction with the Annual Report. Regulated Operations Sempra South American Utilities has controlling interests in two electric distribution utilities in South America, Chilquinta Energ í a S.A. ( Chilquinta Energ í a ) in Chile and Luz del Sur S.A.A. (Luz del Sur) in Peru, and their subsidiaries. Sempra Natural Gas owns Mobile Gas Service Corporation (Mobile Gas) in southwest Alabama and Willmut Gas Company ( Willmut Gas) in Mississippi, and Sempra Mexico owns Ecogas México, S. de R.L. de C.V. ( Ecogas ) in northern Mexico, all natural gas distribution utilities. The California Utilities, Mobile Gas, Willmut Gas, and Ecogas prepare their financial statements in accordance with U.S. GAAP provisions governing rate-regulated operations, as we discuss in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report . Pipeline projects currently under construction by IEnova that are both regulated by the Comisión Reguladora de Energía (or CRE, the Energy Regulatory Commissi on) and 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 i n the Annual Report. |
NEW ACCOUNTING STANDARDS
NEW ACCOUNTING STANDARDS | 6 Months Ended |
Jun. 30, 2016 | |
Significant Accounting Policies | |
New Accounting Standards | N OTE 2. NEW ACCOUNTING STANDARDS We describe below recent pronouncements that have had or may have a significant effect on our financial statements. We do not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to our financial condition, results of operations, cash flows or disclosures. SEMPRA ENERGY, SDG&E AND SOCALGAS 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 f or 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 n onfinancial 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 p ermits 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 perio ds in the year of adoption. We are currently evaluating the effect of the standards on our ongoing financial reporting and have not yet selected the timing of adoption or our transition method . 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 not 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 tho se 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 value 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 effectiv e for fiscal years beginning after December 15, 2017. We will adopt ASU 2016-01 on January 1, 2018 as required and do not expect it to materially affect our financial condition, results of operations or cash flows. We will make the required changes to our disclosures upon adoption. 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 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 qualitative disclosures along with specific q uantitative 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 standar d 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 recognize 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 . ASU 2016-05, “Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships”: ASU 2016-05 provides clarification that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument does not, in and of itse lf, require dedesignation of that hedging relationship provided that all other hedge accounting criteria continue to be met. ASU 2016-05 may be adopted prospectively or using a modified retrospective approach. We prospectively adopted ASU 2016-05 on Januar y 1, 2016, and it did not affect our financial condition, results of operations or cash flows. 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 from operating to financing activities on the statement of cash flo ws 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 taxi ng authorities in connection with withheld shares should be classified as financing activities in the statement of cash flows. Additionally, the standard provides for an accounting policy election to either continue to estimate forfeitures or account for them as they occur. For public entities, ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, with early adoption permitted, and is effective for interim periods in the year of adoption. We are currently evaluating the full effect of the standard on our ongoing financial reporting, and have not yet concluded as to whether we will elect an early adoption. If we early adopt in 2016, we will recognize a $34 million tax benefit in earnings, which is currently recorded in Shareholders’ Equity, related to the six month s ended June 30, 2016, and a benefit to retained earnings as of January 1, 2016 of approximately $107 million, both associated with the provision in ASU 2016-09 to recognize all excess tax benefits related to share-based compensation. ASU 2016-13 , “ Measure ment 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 all owance 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 fi scal 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. |
RECENT INVESTMENT ACTIVITY
RECENT INVESTMENT ACTIVITY | 6 Months Ended |
Jun. 30, 2016 | |
Investments [Abstract] | |
Recent Investment Activity | NOTE 3. ACQUISITION AND DIVESTITURE ACTIVITY We consolidate assets and liabilities acquired as of the purchase date and include earnings from acquisitions in consolidated earnings after the purchase date. ACQUISITIONS Sempra Renewables In July 2016, Sempra Renewables invested $22 million to acquire a 100-percent interest in the Appl e Blossom Wind project, a 100-megawatt (MW) wind farm currently under development in Huron County, Michigan. The wind farm has a 15-year power purchase agreement with Consu mers Energy that will commence upon commercial operation, expected in late 2017. In March 2015, Sempra Renewables invested $8 million to acquire a 100-percent interest in the Black Oak Getty Wind project, a 78-MW wind farm currently under construction in S tearns County, Minnesota. The wind farm has a 20-year power purchase agreement with Minnesota Municipal Power Agency that will commence upon commercial operation, expected in late 2016. PENDING ACQUISITION Sempra Mexico IEnova and Petróleos Mexicanos (or PEMEX, the Mexican state-owned oil company) are 50-50 partners in the joint venture Gasoductos de Chihuahua S. de R.L. de C.V. ( GdC ). GdC develops and operates energy infrastructure in Mexico. On July 31, 2015, IEnova entered into an agreement to purchase PEMEX’s 50-percent interest in GdC . The assets involved in the acquisition included three natural gas pipelines, an ethane pipeline, and a liquid petroleum gas pipeline and associated storage terminal. In December 2015, Mexico’s Comisión Federal de Compete ncia Económica (COFECE or Mexican Competition Commission) objected to the transaction based upon previous antitrust rulings on PEMEX’s indirect ownership of two of the assets, the TDF S. de R.L. de C.V. liquid petroleum gas pipeline (TDF Pipeline) and the San Fernando natural gas pipeline (San Fernando Pipeline), included in the acquisition as proposed. COFECE specified that these assets must be offered by PEMEX in a competitive bidding process as a prerequisite for approval of any transaction involving the se two assets. COFECE’s decision did not object to IEnova’s acquisition of the assets on a market concentration basis. In July 2016, IEnova announced that the parties reached an agreement to restructure the transaction to allow PEMEX to satisfy the condi tions imposed by the COFECE to hold the TDF Pipeline and San Fernando Pipeline for sale in an open bidding process. The open bidding process was held in July 2016 and ended with no bidders participating. Subject to final approval by the COFECE, IEnova expe cts to acquire GdC’s assets consistent with the original agreement , including the TDF and San Fernando pipelines, for a purchase price of approximately $1.1 billion. Also c onsistent with the original agreement, we expect the transaction to exclude the Los Ramones Norte pipeline that is owned under a separate joint venture with GdC , PEMEX, BlackRock and First Reserve, keeping IEnova’s interest in the pipeline at the current 25 percent. We expect the transac tion to close in the third quarter of 2016. The tran saction remains subject to the satisfactory completion of the Mexican antitrust review and c ustomary closing conditions, and may require further approvals from other Mexican authorities. IEnova currently accounts for its 50-percent interest in GdC as an eq uity method investment. At closing, GdC will become a wholly owned, consolidated subsidiary of IEnova . We anticipate that we will recognize a noncash gain associated with the remeasurement of our equity interest in GdC upon consummation of the transaction; however, as the assets to be included in the transaction are not yet confirmed and the valuation of such assets is not finalized , we are unable to reasonably estimate the gain at this time. Sempra Energy has committed to provide interim financing to close the transaction. We expect to ultimately finance the acquisition with a combination of debt and equity at IEnova based on market conditions. 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. The following table summarizes the carrying amounts of the major classes of assets and related liabilities held for sale a t June 30, 2016, and we discuss each group of assets below. ASSETS HELD FOR SALE AT JUNE 30, 2016 (Dollars in millions) Termoeléctrica de Mexicali EnergySouth Inc. Cash and cash equivalents $ 1 $ 1 Inventories 8 3 Other current assets 21 13 Regulatory assets ― 12 Goodwill ― 72 Other assets 17 53 Property, plant and equipment, net 250 203 Total assets held for sale $ 297 $ 357 Accounts payable $ 1 $ 9 Other current liabilities 6 12 Long-term debt ― 67 Deferred income taxes 13 38 Regulatory liabilities ― 22 Asset retirement obligations 4 12 Other liabilities 19 19 Total liabilities held for sale $ 43 $ 179 Sempra Mexico Termoeléctrica de Mexicali In February 2016, management approved a plan to market and sell Sempra Mexico’s Termoeléctrica de Mexicali ( TdM ) , a 625-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. In connection with classifying TdM as held for sale, we recognized expense of $3 mill ion ($2 million after noncontrolling interests) and $32 million ($26 million after noncontrolling interests) in the three months and six months ended June 30, 2016, respectively, in Income Tax Expense on Sempra Energy’s Condensed Consolidated Statements of Operations 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 cou ld change in future periods until the date of sale. We considered the estimated fair value of the plant, less costs to sell, and determined that no adjustment to carrying value was required. In estimating fair value, we used both a market approach and dis counted cash flow valuation techniques. In the event that the estimated sales price, less transaction costs, is less than the carrying value, or updated market information indicates fair value may be less than carrying value, we would recognize a loss in o ur results of operations at that time. We expect to complete the sale in the second half of 2016. Sempra Natural Gas EnergySouth Inc. In April 2016, Sempra Natural Gas signed a definitive agreement to sell 100 percent of the outstanding equity of EnergySouth Inc. ( EnergySouth ), the parent compan y of Mobile Gas and Willmut Gas. We expect to receive cash proceeds of approximately $323 million, subject to normal adjustments at closing, and the buyer will assume existing debt of approximately $67 million. Litigation at Mobile Gas, discussed in Note 1 1, will be retained by Mobile Gas at the close of the transaction. The transaction is subject to customary regulatory approvals. In addition, the State of Missouri Public Service Commission (MPSC) in July 2016 opened an investigation into whether the trans action will have any effect on Missouri ratepayers and is subject to MPSC’s jurisdiction. We expect the sale to close in 2016. DIVESTITURES Sempra Natural Gas Investment in Rockies Express Pipeline LLC In March 2016, Sempra Natural Gas entered into an ag reement to sell its 25-percent interest in Rockies Express Pipeline LLC (Rockies Express) to a subsidiary of Tallgrass Development, LP for cash consideration of $440 million, subject to adjustment at closing. The transaction closed in May 2016 for total ca sh proceeds of $443 million. At the date of the agreement, the carrying value of Sempra Natural Gas’ investment in Rockies Express was $484 million. Sempra Natural Gas 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 (Losses), Before Income Tax, on the Sempra Energy Condensed Consolidated Statement of Operations in the first quarter of 2016. We discuss non-recurring fair value measures and the associa ted accounting impact on our investment in Rockies Express in Note 8. In the second quarter of 2016, Sempra Natural Gas permanently released pipeline capacity that it held with Rockies Express and others, as we discuss in Note 11. Mesquite Power Plant In April 2015, Sempra Natural Gas sold the remaining 625-MW block of the Mesquite Power plant, together with a related power sales contract, for net cash proceeds of $347 million. We recognized a pretax gain on the sale of $61 million ($36 million after-tax), included in Gain on Sale of Assets on our Condensed Consolidated Statements of Operations for the three months and six months ended June 30, 2015. |
INVESTMENTS IN UNCONSOLIDATED E
INVESTMENTS IN UNCONSOLIDATED ENTITIES | 6 Months Ended |
Jun. 30, 2016 | |
Investments [Abstract] | |
Investments in Unconsolidated Entities | NOTE 4. INVESTMENTS IN UNCONSOLIDATED ENTITIES 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 MEXICO In June 2016, Infraestructura Marina del Golfo (IMG), a joint venture between IEnova and a subsidiary of TransCanada Corporation (TransCanada), was awarded the right to build, own and operate the Sur de Texas – Tuxpan natural gas pipeline by the Federal El ectricity Commission ( Comisión Federal de Electricidad , or CFE). IEnova has a 40-percent interest in the project and TransCanada owns the remaining 60-percent interest. The project is expected to be completed in late 2018 and is fully contracted under a 25 -year natural gas transpor tation service contract with the CFE. SEMPRA RENEWABLES Sempra Renewables invested cash of $18 million in its joint ventures during both the six months ended June 30, 2016 and 2015. SEMPRA NATURAL GAS Sempra Natural Gas capitalized $2 4 million of interest during both the six months ended June 30, 2016 and 2015 related to its investment in Cameron LNG Holdings, LLC (Cameron LNG JV), which has not commenced planned principal operations. In addition, during the six months ended June 30, 2 015, Sempra Natural Gas invested cash of $3 million in the joint venture and accrued $7 million for a project capital call due and subsequently paid in July 2015. In May 2016, Sempra Natural Gas sold its 25-percent interest in Rockies Express, as we discus s in Note 3. In April 2015, Sempra Natural Gas invested $113 million of cash in Rockies Express to repay project debt that matured in early 2015. GUARANTEES We discuss guarantees that we have provided, which have a maximum aggregate amount of $4.5 billion, in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report. These guarantees have an aggregate carrying value of $63 million at June 30, 2016. |
OTHER FINANCIAL DATA
OTHER FINANCIAL DATA | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Text Block [Abstract] | |
Other Financial Data | INVENTORIES The components of inventories by segment are as follows: INVENTORY BALANCES (Dollars in millions) Natural gas Liquefied natural gas Materials and supplies Total June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 SDG&E $ 1 $ 6 $ ― $ ― $ 70 $ 69 $ 71 $ 75 SoCalGas(1) ― 49 ― ― 44 30 44 79 Sempra South American Utilities ― ― ― ― 43 30 43 30 Sempra Mexico ― ― 7 3 2 10 9 13 Sempra Renewables ― ― ― ― 3 3 3 3 Sempra Natural Gas 96 94 4 3 ― 1 100 98 Sempra Energy Consolidated $ 97 $ 149 $ 11 $ 6 $ 162 $ 143 $ 270 $ 298 (1) At both June 30, 2016 and December 31, 2015, 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. GOODWILL We discuss goodwill in Note 1 of the Notes to Consolidated Financial Statements in the Annual Report. The decrease in goodwill from $819 million at December 31, 2015 to $786 million at June 30, 2016 is due to the reclassification of EnergySouth goodwill at Sempra Natural Gas to assets held for sale , offset by foreign currency translation at Sempra South American Utilities. We record the offset of the fluctuation from foreign currency translation in Other Comprehensive Income (Loss) . 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 upon 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 sup plies 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 thes e 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 faci lity 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 co nsider 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 beneficiar y, 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 purchased-power agreement, at a predetermined price subject to adjustments based on performance of the facility. If SDG&E does not e xercise its option, under certain circumstances, it may be required to purchase the power plant at a predetermined price, 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 porti on of the risk that the value of Otay Mesa VIE could decline. Accordingly, SDG&E and Sempra Energy have consolidated Otay Mesa VIE. Otay Mesa VIE’s equity of $37 million at June 30, 2016 and $53 million at December 31, 2015 is included on the Condensed Con solidated Balance Sheets in Other Noncontrolling Interests for Sempra Energy and in Noncontrolling Interest for SDG&E. OMEC LLC has a loan outstanding of $310 million at June 30, 2016, the proceeds of which were used for the construction of OMEC. The loan is with third party lenders and is secured by OMEC’s property, plant and equipment. SDG&E is n ot 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 belo w generally correspond to SDG&E’s Condensed Consolidated Statements of Operations. AMOUNTS ASSOCIATED WITH OTAY MESA VIE (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Operating expenses Cost of electric fuel and purchased power $ (17) $ (21) $ (34) $ (39) Operation and maintenance 15 6 19 10 Depreciation and amortization 10 6 17 12 Total operating expenses 8 (9) 2 (17) Operating (loss) income (8) 9 (2) 17 Interest expense (5) (5) (10) (9) (Loss) income before income taxes/Net (loss) income (13) 4 (12) 8 Losses (earnings) attributable to noncontrolling interest 13 (4) 12 (8) 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 June 30, 2016. In addition to the tolling agreements described above, other variable interests involve various elements of fuel and power costs, including certain construction costs, tax credits, 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 ou r 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 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 t he Annual Report. Sempra Natural Gas Sempra Energy’s equity method investment in Cameron LNG JV is considered to be a VIE generally 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 $818 million at June 30, 2016 and $983 million at D ecember 31, 2015. Our maximum exposure to loss includes the carrying value of our investment and the guarantees discussed above in Note 4 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 entiti es 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 th at 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 June 30, 2016 2015 2016 2015 Service cost $ 27 $ 29 $ 6 $ 7 Interest cost 40 39 11 11 Expected return on assets (41) (44) (18) (17) Amortization of: Prior service cost 3 2 ― ― Actuarial loss 7 11 ― ― Regulatory adjustment (28) (30) 2 ― Total net periodic benefit cost $ 8 $ 7 $ 1 $ 1 Six months ended June 30, 2016 2015 2016 2015 Service cost $ 55 $ 59 $ 11 $ 14 Interest cost 80 78 22 23 Expected return on assets (83) (88) (35) (34) Amortization of: Prior service cost (credit) 6 5 ― (1) Actuarial loss 13 19 ― ― Regulatory adjustment (56) (59) 4 ― Total net periodic benefit cost $ 15 $ 14 $ 2 $ 2 NET PERIODIC BENEFIT COST – SDG&E (Dollars in millions) Pension benefits Other postretirement benefits Three months ended June 30, 2016 2015 2016 2015 Service cost $ 8 $ 8 $ 1 $ 2 Interest cost 11 10 2 2 Expected return on assets (13) (13) (2) (3) Amortization of: Prior service cost 1 1 1 1 Actuarial loss (gain) 2 2 (1) ― Regulatory adjustment (8) (7) (1) (2) Total net periodic benefit cost $ 1 $ 1 $ ― $ ― Six months ended June 30, 2016 2015 2016 2015 Service cost $ 15 $ 16 $ 2 $ 4 Interest cost 21 20 4 4 Expected return on assets (25) (27) (5) (6) Amortization of: Prior service cost 1 1 2 2 Actuarial loss (gain) 5 4 (1) ― Regulatory adjustment (15) (12) (2) (4) Total net periodic benefit cost $ 2 $ 2 $ ― $ ― NET PERIODIC BENEFIT COST – SOCALGAS (Dollars in millions) Pension benefits Other postretirement benefits Three months ended June 30, 2016 2015 2016 2015 Service cost $ 18 $ 19 $ 3 $ 5 Interest cost 25 24 9 9 Expected return on assets (27) (27) (14) (14) Amortization of: Prior service cost (credit) 2 2 (1) (2) Actuarial loss 2 6 ― ― Regulatory adjustment (20) (23) 3 2 Total net periodic benefit cost $ ― $ 1 $ ― $ ― Six months ended June 30, 2016 2015 2016 2015 Service cost $ 35 $ 38 $ 7 $ 10 Interest cost 50 49 17 18 Expected return on assets (52) (54) (28) (28) Amortization of: Prior service cost (credit) 4 4 (2) (4) Actuarial loss 5 11 ― ― Regulatory adjustment (41) (47) 6 4 Total net periodic benefit cost $ 1 $ 1 $ ― $ ― Benefit Plan Contributions The following table shows our year-to-date contributions to pension and other postretirement benefit plans and the amounts w e expect to contribute in 20 16 : BENEFIT PLAN CONTRIBUTIONS (Dollars in millions) Sempra Energy Consolidated SDG&E SoCalGas Contributions through June 30, 2016: Pension plans $ 23 $ 2 $ ― Other postretirement benefit plans 2 ― 1 Total expected contributions in 2016: Pension plans $ 123 $ 4 $ 77 Other postretirement benefit plans 6 2 1 RABBI TRUST In 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 $436 million and $464 million at June 30, 2016 and December 31, 2015, respectively. EARNINGS PER SHARE The following table provides earnings per share (EPS) computations for the three months and six months ended June 30 , 2016 and 2015. 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 June 30, Six months ended June 30, 2016 2015 2016 2015 Numerator: Earnings/Income attributable to common shares $ 16 $ 295 $ 335 $ 732 Denominator: Weighted-average common shares outstanding for basic EPS(1) 250,096 248,108 249,915 247,916 Dilutive effect of stock options, restricted stock awards and restricted stock units 1,842 3,383 1,771 3,348 Weighted-average common shares outstanding for diluted EPS 251,938 251,491 251,686 251,264 Earnings per share: Basic $ 0.06 $ 1.19 $ 1.34 $ 2.95 Diluted 0.06 1.17 1.33 2.91 (1) Includes 568 and 501 average fully vested restricted stock units held in our Deferred Compensation Plan for the three months ended June 30, 2016 and 2015, respectively, and 562 and 476 of such units for the six months ended June 30, 2016 and 2015, 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. The dilution from common stock options is based on the treasury stock method. Under this method, proceeds based on the exercise price plus unearned compensation and windfall tax benefits recognized , minus tax shortfalls recognized , are assumed to be used to repurchase shares on the open market at the average market price for the period. The windfall tax benefits are tax deductions we would receive upon the assumed exercise of stock options in excess of the deferred income taxes we recorded related to the c ompensation expense on the stock options. Tax shortfalls occur when the assumed tax deductions are less than recorded deferred income taxes. The calculation of dilutive common stock equivalents excludes options for which the exercise price on common stock was greater than the average market price during the period (out-of-the-money options). For the three months and six months ended June 3 0 , 2016 and 2015, we had no such antidilutive stock options outstanding. For the three months and six months ended June 30 , 201 6 and 2015, we had no stock options outstanding that were antidilutive because of the unearned compensation and windfall tax benefits included in the assumed proceeds u nder the treasury stock method. The dilution from unvested restricted stock award s (RSAs) and restricted stock units (RSUs) is also based on the treasury stock method. Proceeds equal to the unearned compensation and windfall tax benefits recognized , minus tax shortfalls recognized , related to the awards and units are assumed to be used to repurchase shares on the open market at the average market price for the period. The windfall tax benefits or tax shortfalls recognized are the difference between tax deductions we would receive upon the assumed vesting of RSAs or RSUs and the deferred income taxes we recorded related to the compensation expense on such awards and units. There were no antidilutive RSAs and 1,010 antidilutive RSUs from the application of unearned compensation in the treasury stock method for the three months end ed June 3 0 , 2016. There were no such antidilutive RSAs and 2 , 408 such antidilutive RSUs for the six months ended June 30, 2016. There were no such antidilutive RSAs and 4,715 such antidilutive RSUs for both the three months and six months ended June 30, 2015. Our performance-based RSUs include awards that vest at the end of three-year (for awards granted during or after 2015) or four-year performance periods based on Sempra Energy’s total return to shareholders relative to that of specified market indices (Total Shareholder Return or TSR RSUs) or based on the compound annual growth rate of Sempra Energy’s EPS (EPS RSUs). The comparative market indices for the TSR RSUs are the Standard & Poor’s (S&P) 500 Utilities Index and the S&P 500 Index. We primarily use long-term analyst consensus growth estimates for S&P 500 Utilities Index peer companies to develop our EPS RSU targ ets. TSR RSUs represent the right to receive from zero to 1.5 shares (2.0 shares for awards granted during or after 2014) of Sempra Energy common stock if performance targets are met. EPS RSUs represent the right to receive from zero to 2.0 shares of Sempr a Energy common stock if performance targets are met. If performance falls between the targets specified for each performance metric, we calculate the payout using linear interpolation. Participants also receive additional shares for dividend equivalents o n shares subject to RSUs, which are deemed reinvested to purchase additional units that become subject to the same vesting conditions as the RSUs to which the dividends relate. We discuss performance-based RSU awards further in Note 8 of the Notes to Conso lidated Financial Statements in our Annual Report. Our RSAs , which are solely service-based, and those RSUs that are service-based or issued in connection with certain other performance goals represent the right to receive up to 1.0 share if the service requirements or certain other vesting conditions are met. These RSAs and RSUs have the same dividend equivalent rights as the performance-based RSUs described above . We include RSAs and these RSUs in potential dilutive shares at 100 percent , subject to the application of the treasury stock method. We includ e our TSR RSUs and EPS RSUs in potential dilutive shares at zero to up to 200 percent to the extent that they currently meet the performance requirements for vesting, subject to the application of the treasury stock method. Due to market fluctuations of bo th Sempra Energy stock and the comparative indices , dilutive TSR RSU shares may vary widely from period-to-period. If it were assumed that performance goals for all performance-based RSUs were met at maximum levels and if the treasury stock method were not applied to any of our RSAs or RSUs, the incremental potential dilutive shares would be 1,417,481 and 1,370,460 for the three months ended June 30, 2016 and 2015, respectively , and 1,491,195 and 1,424,855 for the six months ended June 30, 2016 and 2015, re spectively. SHARE-BASED COMPENSATION We discuss our share-based compensation plans in Note 8 of the Notes to Consolidated Financial Statements in the Annual Report. We recorded share-based compensation expense, net of income taxes, of $6 million and $7 million for the three months ended June 30, 2016 and 2015, respectively, and $13 million and $15 million for the six months ended June 30, 2016 and 2015, respectively. Pursuant to our Sempra Energy share-based compensation plans, Sempra Energy’s compensat ion committee granted 373,070 TSR RSUs, 94,760 EPS RSUs and 95,876 service-based RSUs during the six months ended June 30, 2016, primarily in January. During the six months ended June 30, 2016, IEnova issued 183,970 RSUs from the IEnova 2013 Long-Term Incentive Plan, under which awards are cash settled at ves ting based on the price of IEnova common stock. 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. The following table shows capitalized financing costs for the three months and six months ended June 30, 2016 and 2015. CAPITALIZED FINANCING COSTS (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Sempra Energy Consolidated: AFUDC related to debt $ 8 $ 7 $ 15 $ 13 AFUDC related to equity 30 31 57 58 Other capitalized interest 20 17 38 34 Total Sempra Energy Consolidated $ 58 $ 55 $ 110 $ 105 SDG&E: AFUDC related to debt $ 4 $ 4 $ 8 $ 7 AFUDC related to equity 13 10 24 18 Total SDG&E $ 17 $ 14 $ 32 $ 25 SoCalGas: AFUDC related to debt $ 4 $ 3 $ 7 $ 6 AFUDC related to equity 10 10 20 19 Total SoCalGas $ 14 $ 13 $ 27 $ 25 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) SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Foreign Total currency Pension and other accumulated other translation Financial postretirement comprehensive adjustments instruments benefits income (loss) Three months ended June 30, 2016 and 2015 2016: Balance as of March 31, 2016 $ (514) $ (221) $ (86) $ (821) Other comprehensive income (loss) before reclassifications 11 (48) ― (37) Amounts reclassified from accumulated other comprehensive income ― 5 1 6 Net other comprehensive income (loss) 11 (43) 1 (31) Balance as of June 30, 2016 $ (503) $ (264) $ (85) $ (852) 2015: Balance as of March 31, 2015 $ (384) $ (145) $ (84) $ (613) Other comprehensive (loss) income before reclassifications (43) 57 ― 14 Amounts reclassified from accumulated other comprehensive income ― 2 1 3 Net other comprehensive (loss) income (43) 59 1 17 Balance as of June 30, 2015 $ (427) $ (86) $ (83) $ (596) Six months ended June 30, 2016 and 2015 2016: Balance as of December 31, 2015 $ (582) $ (137) $ (87) $ (806) Other comprehensive income (loss) before reclassifications 79 (130) ― (51) Amounts reclassified from accumulated other comprehensive income ― 3 2 5 Net other comprehensive income (loss) 79 (127) 2 (46) Balance as of June 30, 2016 $ (503) $ (264) $ (85) $ (852) 2015: . Balance as of December 31, 2014 $ (322) $ (90) $ (85) $ (497) Other comprehensive (loss) income before reclassifications (105) 3 ― (102) Amounts reclassified from accumulated other comprehensive income ― 1 2 3 Net other comprehensive (loss) income (105) 4 2 (99) Balance as of June 30, 2015 $ (427) $ (86) $ (83) $ (596) (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) Amounts reclassified Details about accumulated from accumulated other Affected line item on Condensed other comprehensive income (loss) components comprehensive income (loss) Consolidated Statements of Operations Three months ended June 30, 2016 2015 Sempra Energy Consolidated: Financial instruments: Interest rate and foreign exchange instruments $ 3 $ 3 Interest Expense Interest rate instruments 2 3 Equity Earnings (Losses), Before Income Tax Interest rate and foreign exchange instruments 5 ― Equity Earnings, Net of Income Tax Total before income tax 10 6 (1) (1) Income Tax Expense Net of income tax 9 5 (4) (3) Earnings Attributable to Noncontrolling Interests $ 5 $ 2 Pension and other postretirement benefits: Amortization of actuarial loss $ 2 $ 2 See note (1) below (1) (1) Income Tax Expense Net of income tax $ 1 $ 1 Total reclassifications for the period, net of tax $ 6 $ 3 SDG&E: Financial instruments: Interest rate instruments $ 3 $ 3 Interest Expense (3) (3) Losses (Earnings) Attributable to Noncontrolling Interest Total reclassifications for the period, net of tax $ ― $ ― (1) Amounts are included in the computation of net periodic benefit cost (see "Pension and Other Postretirement Benefits" above). RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Dollars in millions) Amount reclassified Details about accumulated from accumulated other Affected line item on Condensed other comprehensive income (loss) components comprehensive income (loss) Consolidated Statements of Operations Six months ended June 30, 2016 2015 Sempra Energy Consolidated: Financial instruments: Interest rate and foreign exchange instruments $ 7 $ 9 Interest Expense Interest rate instruments 5 6 Equity Earnings (Losses), Before Income Tax Interest rate and foreign exchange instruments 6 ― Equity Earnings, Net of Income Tax Commodity contracts not subject to rate recovery (7) (7) Revenues: Energy-Related Businesses Total before income tax 11 8 (1) ― Income Tax Expense Net of income tax 10 8 (7) (7) Earnings Attributable to Noncontrolling Interests $ 3 $ 1 Pension and other postretirement benefits: Amortization of actuarial loss $ 4 $ 4 See note (1) below (2) (2) Income Tax Expense Net of income tax $ 2 $ 2 Total reclassifications for the period, net of tax $ 5 $ 3 SDG&E: Financial instruments: Interest rate instruments $ 6 $ 6 Interest Expense (6) (6) Losses (Earnings) Attributable to Noncontrolling Interest Total reclassifications for the period, net of tax $ ― $ ― (1) Amounts are included in the computation of net periodic benefit cost (see "Pension and Other Postretirement Benefits" above). For the three months and six months ended June 30, 2016 and 2015, Other Comprehensive Income (Loss) (OCI), excluding amounts attributable to noncontrolling interests, at SDG&E and SoCalGas was negligible , and reclassifications out of A OCI to Net Income were also negligible for SoCalGas . SHAREHOLDERS’ EQUITY AND NONCONTROLLING INTERESTS The following tables provide reconciliations of changes in Sempra Energy’s and SDG&E’s shareholders’ equity and noncontrolling interests for the six months ended June 30, 2016 and 2015. SHAREHOLDERS’ EQUITY AND NONCONTROLLING INTERESTS – SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Sempra Energy Non- shareholders’ controlling Total equity interests(1) equity Balance at December 31, 2015 $ 11,809 $ 770 $ 12,579 Comprehensive income 290 22 312 Preferred dividends of subsidiary (1) ― (1) Share-based compensation expense 24 ― 24 Common stock dividends declared (377) ― (377) Issuances of common stock 56 ― 56 Repurchases of common stock (54) ― (54) Tax benefit related to share-based compensation 34 ― 34 Equity contributed by noncontrolling interest ― 1 1 Distributions to noncontrolling interests ― (11) (11) Balance at June 30, 2016 $ 11,781 $ 782 $ 12,563 Balance at December 31, 2014 $ 11,326 $ 774 $ 12,100 Comprehensive income 634 33 667 Preferred dividends of subsidiary (1) ― (1) Share-based compensation expense 26 ― 26 Common stock dividends declared (347) ― (347) Issuances of common stock 59 ― 59 Repurchases of common stock (66) ― (66) Tax benefit related to share-based compensation 52 ― 52 Equity contributed by noncontrolling interest ― 1 1 Distributions to noncontrolling interests ― (16) (16) Balance at June 30, 2015 $ 11,683 $ 792 $ 12,475 (1) Noncontrolling interests include the preferred stock of SoCalGas and other noncontrolling interests as listed in the table below under "Other Noncontrolling Interests." SHAREHOLDER'S EQUITY AND NONCONTROLLING INTEREST – SDG&E (Dollars in millions) SDG&E Non- shareholder’s controlling Total equity interest equity Balance at December 31, 2015 $ 5,223 $ 53 $ 5,276 Comprehensive income (loss) 229 (13) 216 Common stock dividends declared (175) ― (175) Distributions to noncontrolling interest ― (3) (3) Balance at June 30, 2016 $ 5,277 $ 37 $ 5,314 Balance at December 31, 2014 $ 4,932 $ 60 $ 4,992 Comprehensive income 273 9 282 Distributions to noncontrolling interest ― (8) (8) Balance at June 30, 2015 $ 5,205 $ 61 $ 5,266 SHAREHOLDERS' EQUITY ― SOCALGAS (Dollars in millions) SoCalGas shareholders' equity Balance at December 31, 2015 $ 3,149 Comprehensive income 195 Preferred stock dividends declared (1) Balance at June 30, 2016 $ 3,343 Balance at December 31, 2014 $ 2,781 Comprehensive income 285 Preferred stock dividends declared (1) Balance at June 30, 2015 $ 3,065 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 compre hensive income or loss attributable to noncontrolling interests is separately identified on the Condensed Consolidated Statements of Comprehensive Income (Loss). Preferred Stock At Sempra Energy, the preferred stock of SoCalGas is presented as a noncontro lling interest and preferred stock dividends are charges against income related to noncontrolling interests. We provide additional information concerning preferred stock in Note 11 of the Notes to Consolidated Financial Statements in the Annual Report. Oth er Noncontrolling Interests At June 30 , 2016 and December 31, 2015, we reported the following noncontrolling ownership interests held by others (not including preferred shareholders) recorded in Other Noncontrolling Interests in Total Equity on Sempra Ene rgy’s Condensed Consolidated Balance Sheets: OTHER NONCONTROLLING INTERESTS (Dollars in millions) Percent ownership held by others June 30, December 31, June 30, December 31, 2016 2015 2016 2015 SDG&E: Otay Mesa VIE 100 % 100 % $ 37 $ 53 Sempra South American Utilities: Chilquinta Energía subsidiaries(1) 23.2 – 43.4 23.5 – 43.4 21 21 Luz del Sur 16.4 16.4 175 164 Tecsur 9.8 9.8 4 4 Sempra Mexico: IEnova 18.9 18.9 484 468 Sempra Natural Gas: Bay Gas Storage Company, Ltd. 9.1 9.1 26 25 Liberty Gas Storage, LLC 23.3 23.2 14 14 Southern Gas Transmission Company 49.0 49.0 1 1 Total Sempra Energy $ 762 $ 750 (1) Chilquinta Energía has four subsidiaries with noncontrolling interests held by others. Percentage range reflects the highest and lowest ownership percentages among these subsidiaries. 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) June 30, 2016 December 31, 2015 Sempra Energy Consolidated: Total due from various unconsolidated affiliates - current $ 6 $ 6 Sempra South American Utilities(1): Eletrans S.A. and Eletrans II S.A.: 4% Note(2) $ 79 $ 72 Other related party receivables 2 ― Sempra Mexico(1): Affiliate of joint venture with PEMEX: Note due November 13, 2017(3) 2 3 Note due November 14, 2018(3) 43 42 Note due November 14, 2018(3) 35 34 Note due November 14, 2018(3) 8 8 Energía Sierra Juárez: Note due June 15, 2018(4) 17 24 Sempra Natural Gas: Cameron LNG JV 6 3 Total due from unconsolidated affiliates - noncurrent $ 192 $ 186 Total due to various unconsolidated affiliates - current $ (8) $ (14) SDG&E: Sempra Energy(5) $ 163 $ ― Other affiliates ― 1 Total due from unconsolidated affiliates - current $ 163 $ 1 Sempra Energy $ ― $ (34) SoCalGas (7) (13) Other affiliates (183) (8) Total due to unconsolidated affiliates - current $ (190) $ (55) Income taxes due from Sempra Energy(6) $ 59 $ 28 SoCalGas: Sempra Energy(7) $ ― $ 35 SDG&E 7 13 Total due from unconsolidated affiliates - current $ 7 $ 48 Sempra Energy $ (25) $ ― Total due to unconsolidated affiliate - current $ (25) $ ― Income taxes due from Sempra Energy(6) $ 9 $ 1 (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., both of which are joint ventures at Chilquinta Energía. (3) U.S. dollar-denominated loan, at a variable interest rate based on a 30 |
DEBT AND CREDIT FACILITIES
DEBT AND CREDIT FACILITIES | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Debt and Credit Facilities | NOTE 6. DEBT AND CREDIT FACILITIES LINES OF CREDIT At June 30, 2016, Sempra Energy Consolidated had an aggregate of $4.2 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 which we describe below. Available unused credit on these lines a t June 30, 2016 was approximately $2.5 billion. Our foreign operations have additional general purpose credit facilities aggregating $1.1 billion at June 30, 2016. Available unused credit on these lines totaled $843 million at June 30, 2016. Sempra Energy Sempra Energy has a $1 billion, five-year syndicated revolving credit agreement expiring in October 2020. Citibank, N.A. serves as administrative agent for the syndicate of 20 lenders, and no single lender has greater than a 7-percent share. Borrowings bea r interest at benchmark rates plus a margin that varies with Sempra Energy’s credit ratings. The facility requires Sempra Energy to maintain a ratio of total indebtedness to total capitalization (as defined in the agreement) of no more than 65 percent at t he end of each quarter. At June 30, 2016, Sempra Energy was in compliance with this and all other financial covenants under the credit facility. The facility also provides for issuance of up to $400 million of letters of credit on behalf of Sempra Energy w ith the amount of borrowings otherwise available under the facility reduced by the amount of outstanding letters of credit. At June 30, 2016, Sempra Energy had no outstanding borrowings or letters of credit supported by the facility. Sempra Global Sempra G lobal has a $2.21 billion, five-year syndicated revolving credit agreement expiring in October 2020. Citibank, N.A. serves as administrative agent for the syndicate of 20 lenders, and no single lender has greater than a 7-percent share. Sempra Energy guar antees Sempra Global’s obligations under the credit facility. Borrowings bear interest at benchmark rates plus a margin that varies with Sempra Energy’s credit ratings. The facility requires Sempra Energy to maintain a ratio of total indebtedness to total capitalization (as defined in the agreement) of no more than 65 percent at the end of each quarter. At June 30, 2016, Sempra Energy was in compliance with this and all other financial covenants under the credit facility. At June 30, 2016, Sempra Global had $1.6 billion of commercial paper outstanding supported by the facility and $643 million of available unused credit on the line. California Utilities SDG&E and SoCalGas have a combined $1 billion, five-year syndicated revolving credit agreement expiring in October 2020. JPMorgan Chase Bank, N.A. serves as administrative agent for the syndicate of 20 lenders, and no single lender has greater than a 7-percent share. The agreement permits each utility to individually borrow up to $750 million, subject to a com bined limit of $1 billion for both utilities. It 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 availabl e under the facility is reduced by the amount of outstanding letters of credit. Borrowings bear interest at benchmark rates plus a margin that varies with the borrowing utility’s credit rating. The agreement requires each utility to maintain a ratio of tot al indebtedness to total capitalization (as defined in the agreement) of no more than 65 percent at the end of each quarter. At June 30, 2016, the California Utilities were in compliance with this and all other financial covenants under the credit facility . Each utility’s obligations under the agreement are individual obligations, and a default by one utility would not constitute a default by the other utility or preclude borrowings by, or the issuance of letters of credit on behalf of, the other utility. A t June 30, 2016, SDG&E had $54 million of commercial paper outstanding and SoCalGas had no outstanding borrowings supported by the facility. Available unused credit on the line at June 30, 2016 was $696 million and $750 million at SDG&E and SoCalGas , respe ctively, subject to the $1 billion maximum combined credit limit. Sempra South American Utilities Sempra South American Utilities has Peruvian Sol- and Chilean Peso-denominated credit facilities aggregating $547 million U.S. dollar equivalent, expiring bet ween 2016 and 2018 . The credit facilities were entered into to finance working capital and for general corporate purposes. The Peruvian facilities require a debt to equity ratio of no more than 170 percent. At June 30, 2016, Sempra South American Utilities was in compliance with this financial covenant under the credit facilities. At June 30, 2016, Sempra South American Utilities had outstanding borrowings of $167 million and bank guarantees of $16 million against the Peruvian facilities, and $252 million o f available unused credit. There were no outstanding borrowings at June 30, 2016 under the $112 million Chilean facility. Sempra Mexico IEnova has a $600 million, five-year revolving credit agreement expiring in August 2020. The lenders are Banco Santande r (México), S.A., Institución de Banca Múltiple , Grupo Financiero Santander México, Banco Nacional de Mexico, S.A. Integrante del Grupo Financiero Banamex , The Bank of Tokyo - Mitsubishi UFJ, LTD., The Bank of Nova Scotia and Sumitomo Mitsui Banking Corporation. At June 30, 2016, IEnova had $121 million of outstanding borrowin gs supported by the facility, and available unused credit on the line was $479 million. WEIGHTED AVERAGE INTEREST RATES The weighted average interest rates on the total short-term debt at Sempra Energy Consolidated were 1.21 percent and 1.09 percent at June 30 , 2016 and December 31, 2015, respectively. T he weighted average interest rates on total s hort-term debt at SDG&E were 1.06 percent and 1.01 percent at June 30, 2016 and December 31, 2015 , respectively. LONG-TERM DEBT SDG&E In May 2016, SDG&E publicly offered and sold $500 million of 2.50-percent first mortgage bonds maturing in 2026. SDG&E used the proceeds from the offering to redeem, prior to a scheduled maturity in 2027, $105 million aggregate principal amount of 5-percent tax-exempt industrial development revenue bonds, to repay outstanding commercial paper and for other general corporate purposes. SoCalGas In June 2016, SoCalGas publicly offered and sold $500 million of 2.60-percent first mortgage bonds maturing in 2026. SoCalGas use d the proceeds from the offering to repay outstanding commercial paper and for other general corporate purposes. INTEREST RATE SWAPS We discuss our fair value interest rate swaps and interest rate swap s to hedge cash flows in Note 7 . |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | NOTE 7. 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 i n 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 reven ues, 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) u ndesignated. 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 offse t 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 Conde nsed Consolid ated 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 co mbination 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 inst rument 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 energy derivatives, both natural gas and electricity, 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 exchang e-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 a ctivities 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 Powe r 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 loss es 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 Natural Gas, 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 Conde nsed 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 Mex ican 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. Fro m 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 June 30, 2016 and December 31, 2015 as follows : NET ENERGY DERIVATIVE VOLUMES (Quantities in millions) June 30, December 31, Segment and Commodity Unit of measure 2016 2015 California Utilities: SDG&E: Natural gas MMBtu(1) 72 70 Electricity MWh(2) 1 1 Congestion revenue rights MWh 30 36 SoCalGas – natural gas MMBtu ― 1 Energy-Related Businesses: Sempra Natural Gas – natural gas MMBtu 30 43 (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 phy sical locations of contractual obligation s 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. We periodically enter into interest rate derivative agreements intended to moderate our exposure to interest rates and to lower our overall costs of borrowing. We 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. Interest rate derivatives are utilized by the California Utilities as well as by other Sempra Energy subsidiaries and joint ventures. Int erest rate derivatives are generally accounted for as hedges, and although the California Utilities generally recover borrowing costs in rates over time, the use of interest rate derivatives is subject to certain regulatory constraints, and the impact of i nterest rate derivatives may not be recovered from customers as timely as described above with regard to energy derivatives. 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 June 30, 2016 and December 31, 2015, the net notional amounts of our interest rate derivatives, excluding joint ventures and cross-currency derivati ves discussed below, were: INTEREST RATE DERIVATIVES (Dollars in millions) June 30, 2016 December 31, 2015 Notional debt Maturities Notional debt Maturities Sempra Energy Consolidated: Cash flow hedges(1) $ 377 2016-2028 $ 384 2016-2028 Fair value hedges ― ― 300 2016 SDG&E: Cash flow hedge(1) 310 2016-2019 315 2016-2019 (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. We are also exposed to exchange rate movements at our Mexican subsidiaries and joint ventures, which have U.S. dollar denominated cash balances, receivab les, 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 tr anslated 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 derivativ es as a means to manage the risk of exposure to significant fluctuations in our income tax expense and equity earnings from these impacts. In January 2016, we entered into foreign currency derivatives with a notional amount totaling $550 million. At June 30, 2016 and December 31, 2015, the net notional amounts of our foreign currency derivatives, excluding joint ventures, were: FOREIGN CURRENCY DERIVATIVES (Dollars in millions) June 30, 2016 December 31, 2015 Notional debt Maturities Notional debt Maturities Sempra Mexico: Cross-currency swaps $ 408 2018-2023 $ 408 2018-2023 Other foreign currency derivatives 550 2016 ― ― In addition, Sempra South American Utilities uses foreign currency derivatives at its subsidiaries and joint ventures as a means to manage foreign currency rate risk. We discuss such swaps at Chilquinta Energía’s Eletrans joint venture investment in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report. FINANCIAL STATEMENT PRESENTATION The Condensed Consolidated Balance Sheets reflect the offsetting of net derivative positions and cash collateral wi th 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 June 30, 2016 and December 31, 2015, including the amount of cash collatera l 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) June 30, 2016 Deferred credits Current Current and other assets: liabilities: liabilities: Fixed-price Fixed-price Fixed-price contracts Other contracts contracts and other assets: and other and other derivatives(1) Sundry derivatives(2) derivatives Sempra Energy Consolidated: Derivatives designated as hedging instruments: Interest rate and foreign exchange instruments(3) $ 1 $ ― $ (15) $ (184) Commodity contracts not subject to rate recovery ― ― (5) ― Derivatives not designated as hedging instruments: Interest rate and foreign exchange instruments ― ― (12) ― Commodity contracts not subject to rate recovery 208 22 (227) (17) Associated offsetting commodity contracts (199) (13) 199 13 Associated offsetting cash collateral ― ― 30 1 Commodity contracts subject to rate recovery 18 52 (35) (48) Associated offsetting commodity contracts (4) (2) 4 2 Associated offsetting cash collateral ― ― 13 15 Net amounts presented on the balance sheet 24 59 (48) (218) Additional cash collateral for commodity contracts not subject to rate recovery 14 ― ― ― Additional cash collateral for commodity contracts subject to rate recovery 27 ― ― ― Total(4) $ 65 $ 59 $ (48) $ (218) SDG&E: Derivatives designated as hedging instruments: Interest rate instruments(3) $ ― $ ― $ (14) $ (23) Derivatives not designated as hedging instruments: Commodity contracts subject to rate recovery 16 52 (32) (48) Associated offsetting commodity contracts (3) (2) 3 2 Associated offsetting cash collateral ― ― 12 15 Net amounts presented on the balance sheet 13 50 (31) (54) Additional cash collateral for commodity contracts subject to rate recovery 26 ― ― ― Total(4) $ 39 $ 50 $ (31) $ (54) SoCalGas: Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery $ ― $ ― $ (1) $ ― Associated offsetting cash collateral ― ― 1 ― Commodity contracts subject to rate recovery 2 ― (3) ― Associated offsetting commodity contracts (1) ― 1 ― Associated offsetting cash collateral ― ― 1 ― 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 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, 2015 Deferred credits Current Current and other assets: liabilities: liabilities: Fixed-price Fixed-price Fixed-price contracts Other contracts contracts and other assets: and other and other derivatives(1) Sundry derivatives(2) derivatives Sempra Energy Consolidated: Derivatives designated as hedging instruments: Interest rate and foreign exchange instruments(3) $ 4 $ 1 $ (15) $ (156) Commodity contracts not subject to rate recovery 13 ― ― ― Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery 245 32 (239) (21) Associated offsetting commodity contracts (232) (20) 232 20 Associated offsetting cash collateral (6) ― 4 ― Commodity contracts subject to rate recovery 28 49 (61) (64) Associated offsetting commodity contracts (2) (2) 2 2 Associated offsetting cash collateral ― ― 28 26 Net amounts presented on the balance sheet 50 60 (49) (193) Additional cash collateral for commodity contracts not subject to rate recovery 2 ― ― ― Additional cash collateral for commodity contracts subject to rate recovery 28 ― ― ― Total(4) $ 80 $ 60 $ (49) $ (193) SDG&E: Derivatives designated as hedging instruments: Interest rate instruments(3) $ ― $ ― $ (14) $ (23) Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery ― ― (1) ― Associated offsetting cash collateral ― ― 1 ― Commodity contracts subject to rate recovery 27 49 (60) (64) Associated offsetting commodity contracts (2) (2) 2 2 Associated offsetting cash collateral ― ― 28 26 Net amounts presented on the balance sheet 25 47 (44) (59) Additional cash collateral for commodity contracts not subject to rate recovery 1 ― ― ― Additional cash collateral for commodity contracts subject to rate recovery 27 ― ― ― Total(4) $ 53 $ 47 $ (44) $ (59) SoCalGas: Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery $ ― $ ― $ (1) $ ― Associated offsetting cash collateral ― ― 1 ― Commodity contracts subject to rate recovery 1 ― (1) ― Net amounts presented on the balance sheet 1 ― (1) ― Additional cash collateral for commodity contracts subject to rate recovery 1 ― ― ― Total $ 2 $ ― $ (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 effects of derivative instruments designated as hedges on the Condensed Consolidated Statement s of Operations and in OCI and AOCI for the three and six months ended June 30 were FAIR VALUE HEDGE IMPACTS (Dollars in millions) Pretax gain (loss) on derivatives recognized in earnings Three months ended June 30, Six months ended June 30, Location 2016 2015 2016 2015 Sempra Energy Consolidated: Interest rate instruments Interest Expense $ 1 $ 2 $ 3 $ 4 Interest rate instruments Other Income, Net (2) (3) (2) (2) Total(1) $ (1) $ (1) $ 1 $ 2 (1) There was no hedge ineffectiveness in either the three months or six months ended June 30, 2016 or 2015. All other changes in the fair value of the interest rate swap agreements are exactly offset by changes in the fair value of the underlying long-term debt and are recorded in Other Income, Net. CASH FLOW HEDGE IMPACTS (Dollars in millions) Pretax gain (loss) Pretax (loss) gain reclassified recognized in OCI from AOCI into earnings (effective portion) (effective portion) Three months ended June 30, Three months ended June 30, 2016 2015 Location 2016 2015 Sempra Energy Consolidated: Interest rate and foreign exchange instruments(1) $ 1 $ 6 Interest Expense $ (3) $ (3) Equity Earnings (Losses), Interest rate instruments (70) 89 Before Income Tax (2) (3) Interest rate and foreign Equity Earnings, exchange instruments (15) ― Net of Income Tax (5) ― Commodity contracts not subject Revenues: Energy-Related to rate recovery (5) 1 Businesses ― ― Total(2) $ (89) $ 96 $ (10) $ (6) SDG&E: Interest rate instruments(1)(2) $ (2) $ ― Interest Expense $ (3) $ (3) Six months ended June 30, Six months ended June 30, 2016 2015 Location 2016 2015 Sempra Energy Consolidated: Interest rate and foreign exchange instruments(1) $ (10) $ (12) Interest Expense $ (7) $ (9) Equity Earnings (Losses), Interest rate instruments (207) 11 Before Income Tax (5) (6) Interest rate and foreign Equity Earnings, exchange instruments (33) ― Net of Income Tax (6) ― Commodity contracts not subject Revenues: Energy-Related to rate recovery (4) ― Businesses 7 7 Total(2) $ (254) $ (1) $ (11) $ (8) SDG&E: Interest rate instruments(1)(2) $ (7) $ (5) Interest Expense $ (6) $ (6) (1) Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE. (2) Amounts include negligible hedge ineffectiveness in the three months and six months ended June 30, 2016 and 2015. For Sempra Energy Consolidated, we expect that losses of $23 million, which are net of income tax benefit, that are currently recorded in AOCI (including $13 million in noncontrolling interests, substantially all of which is 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. Actual amounts ultimately reclassified into earnings depend on the interest rates in effect when derivative contracts that are currently outstanding mature. SoCalGas expects that negligible losses, which are net of income tax benefit, tha t 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. For all forecasted transactions, the maximum remaining term over which we are hedging exposure to the variability of cash flows at June 30, 2016 is approximately 13 years and 3 years for Sempra Energy Consolidated and SDG&E, respecti vely. The maximum remaining term for which we are hedging exposure to the variability of cash flows at our equity method investees is 19 years. The effects of derivative instruments not designated as hedging instruments on the Condensed Consolidated Statem ents of Operations for the three months and six months ended June 30 were UNDESIGNATED DERIVATIVE IMPACTS (Dollars in millions) Pretax (loss) gain on derivatives recognized in earnings Three months ended June 30, Six months ended June 30, Location 2016 2015 2016 2015 Sempra Energy Consolidated: Foreign exchange instruments Other Income, Net $ (15) $ (3) $ (12) $ (3) Foreign exchange instruments Equity Earnings, Net of Income Tax ― ― 2 (1) Commodity contracts not subject Revenues: Energy-Related to rate recovery Businesses (24) 9 (29) 12 Commodity contracts not subject to rate recovery Operation and Maintenance 1 1 1 1 Commodity contracts subject Cost of Electric Fuel to rate recovery and Purchased Power 40 (53) 28 (73) Commodity contracts subject to rate recovery Cost of Natural Gas (1) ― (2) 1 Total $ 1 $ (46) $ (12) $ (63) SDG&E: Commodity contracts subject Cost of Electric Fuel to rate recovery and Purchased Power $ 40 $ (53) $ 28 $ (73) SoCalGas: Commodity contracts not subject to rate recovery Operation and Maintenance $ ― $ 1 $ ― $ 1 Commodity contracts subject to rate recovery Cost of Natural Gas (1) ― (2) 1 Total $ (1) $ 1 $ (2) $ 2 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 fu ll collateralization. For Sempra Energy Consolidated, the total fair value of this group of derivative instruments in a net liability position is $6 million at both June 30, 2016 and December 31, 2015. At June 30, 2016, if the credit ratings of Sempra Ene rgy were reduced below investment grade, $8 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 at Jun e 30, 2016 and December 31, 2015 is $2 million and $5 million, respectively. At June 30, 2016, if the credit ratings of SDG&E were reduced below invest ment grade, $4 million of additional assets could be required to be posted as collateral for these deriva tive 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. Suc h additional assurance, if needed, is not material and is not included in the amounts above. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | NOTE 8. FAIR VALUE MEASUREMENTS We discuss the valuation techniques and inputs we use to measure fair value and the definition of the three levels of t he fair value hierarchy in Note 1 of the Notes to Consolida ted Financial Statements in the Annual Report. We have not changed the valuation techniques or types of inputs we use to me asure fair value during the six months ended June 30 , 2016 . 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 June 30, 2016 and December 31, 2015. 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 affec t the valuation of fair value assets and liabilities, and their placement within the fair value hierarchy levels. The fair value of commodity derivative assets and liabilities is presented in accordance with our netting policy, as we discuss in Note 7 un der “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 June 30, 2016 and December 31, 2015 in the tables below include the following: Nuclear decomm issioning trusts reflect the assets of SDG&E’s nuclear decommissioning trusts, excluding cash balances. A third party trustee values the trust assets using prices from a pricing service based on a market approach. We validate these prices by comparison to prices from other independent data sources. Equity and certain debt securities are valued using quoted prices listed on nationally recognized securities exchanges or based on closing prices reported in the active market in which the identical security is t raded (Level 1). Other debt securities are valued based on yields that are currently available for comparable securities of issuers with similar credit ratings (Level 2). 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 obser vable, 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 rela te to CRRs a nd long-term, fixed-price electricity positions at SDG&E, as we discuss below under “Level 3 Information.” Rabbi Trust investments include marketable securities that we value using a market approach based on closing prices reported in the acti ve market in which the identical security is traded (Level 1). These investments in marketable securities were negligible at both June 30, 2016 and December 31, 2015. There were no transfers into or out of Level 1, Level 2 or Level 3 for Sempra Energy C onsolidated , SDG&E or SoCalGas during the periods presented . RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Fair value at June 30, 2016 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 632 $ ― $ ― $ ― $ 632 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 52 52 ― ― 104 Municipal bonds ― 163 ― ― 163 Other securities ― 192 ― ― 192 Total debt securities 52 407 ― ― 459 Total nuclear decommissioning trusts(2) 684 407 ― ― 1,091 Interest rate and foreign exchange instruments ― 1 ― ― 1 Commodity contracts not subject to rate recovery 1 17 ― 14 32 Commodity contracts subject to rate recovery ― 1 63 27 91 Total $ 685 $ 426 $ 63 $ 41 $ 1,215 Liabilities: Interest rate and foreign exchange instruments $ ― $ 211 $ ― $ ― $ 211 Commodity contracts not subject to rate recovery 32 5 ― (31) 6 Commodity contracts subject to rate recovery 1 37 39 (28) 49 Total $ 33 $ 253 $ 39 $ (59) $ 266 Fair value at December 31, 2015 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 619 $ ― $ ― $ ― $ 619 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 47 44 ― ― 91 Municipal bonds ― 156 ― ― 156 Other securities ― 182 ― ― 182 Total debt securities 47 382 ― ― 429 Total nuclear decommissioning trusts(2) 666 382 ― ― 1,048 Interest rate and foreign exchange instruments ― 5 ― ― 5 Commodity contracts not subject to rate recovery 22 16 ― (4) 34 Commodity contracts subject to rate recovery ― 1 72 28 101 Total $ 688 $ 404 $ 72 $ 24 $ 1,188 Liabilities: Interest rate and foreign exchange instruments $ ― $ 171 $ ― $ ― $ 171 Commodity contracts not subject to rate recovery 5 3 ― (4) 4 Commodity contracts subject to rate recovery ― 68 53 (54) 67 Total $ 5 $ 242 $ 53 $ (58) $ 242 (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 June 30, 2016 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 632 $ ― $ ― $ ― $ 632 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 52 52 ― ― 104 Municipal bonds ― 163 ― ― 163 Other securities ― 192 ― ― 192 Total debt securities 52 407 ― ― 459 Total nuclear decommissioning trusts(2) 684 407 ― ― 1,091 Commodity contracts subject to rate recovery ― ― 63 26 89 Total $ 684 $ 407 $ 63 $ 26 $ 1,180 Liabilities: Interest rate instruments $ ― $ 37 $ ― $ ― $ 37 Commodity contracts subject to rate recovery ― 36 39 (27) 48 Total $ ― $ 73 $ 39 $ (27) $ 85 Fair value at December 31, 2015 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 619 $ ― $ ― $ ― $ 619 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 47 44 ― ― 91 Municipal bonds ― 156 ― ― 156 Other securities ― 182 ― ― 182 Total debt securities 47 382 ― ― 429 Total nuclear decommissioning trusts(2) 666 382 ― ― 1,048 Commodity contracts not subject to rate recovery ― ― ― 1 1 Commodity contracts subject to rate recovery ― ― 72 27 99 Total $ 666 $ 382 $ 72 $ 28 $ 1,148 Liabilities: Interest rate instruments $ ― $ 37 $ ― $ ― $ 37 Commodity contracts not subject to rate recovery 1 ― ― (1) ― Commodity contracts subject to rate recovery ― 67 53 (54) 66 Total $ 1 $ 104 $ 53 $ (55) $ 103 (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 June 30, 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 ― 1 2 Total $ ― $ 1 $ ― $ 2 $ 3 Liabilities: Commodity contracts not subject to rate recovery $ 1 $ ― $ ― $ (1) $ ― Commodity contracts subject to rate recovery 1 1 ― (1) 1 Total $ 2 $ 1 $ ― $ (2) $ 1 Fair value at December 31, 2015 Level 1 Level 2 Level 3 Netting(1) Total Assets: Commodity contracts subject to rate recovery $ ― $ 1 $ ― $ 1 $ 2 Total $ ― $ 1 $ ― $ 1 $ 2 Liabilities: Commodity contracts not subject to rate recovery $ 1 $ ― $ ― $ (1) $ ― Commodity contracts subject to rate recovery ― 1 ― ― 1 Total $ 1 $ 1 $ ― $ (1) $ 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 congestion revenue r ights (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 June 30, 2016 2015 Balance as of April 1 $ 11 $ 102 Realized and unrealized gains (losses) 8 (60) Allocated transmission instruments ― 1 Settlements 5 (1) Balance as of June 30 $ 24 $ 42 Change in unrealized gains relating to instruments still held at June 30 $ 9 $ 45 Six months ended June 30, 2016 2015 Balance as of January 1 $ 19 $ 107 Realized and unrealized gains (losses) 7 (54) Allocated transmission instruments ― 1 Settlements (2) (12) Balance as of June 30 $ 24 $ 42 Change in unrealized gains relating to instruments still held at June 30 $ 9 $ 46 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 throug h 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 (CAISO), an objective source. Annual auction prices are published once a year, typically in the middle of November, and remain in effect for the following year. The impact associated with discounting is negligible. Because auction prices are a less observa ble input, these instruments are classified as Level 3. The fair value of these instruments is derived from auction price differences between two locations. From January 1, 2016 to December 31, 2016, the auction prices range from $(24) per MWh to $10 per M Wh at a given location, and from January 1, 2015 to December 31, 2015, the auction prices ranged from $(16) per MWh to $8 per MWh at a given location. Positive values between two locations represent expected future reductions in congestion costs, whereas n egative 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 (lowe r) 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. At June 30, 2016, these electricity forward prices range from $21.55 per MWh to $62.71 per MWh. 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 p osition 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 also do not affect earnings. Fair Value of Financial Instruments The fair values of certain of our financial instruments (cash, temporary investments, accounts and notes receivable, current 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 Deferre d Compensation Plans are carried at cash surrender values, which represent the amount of cash that could be realized under the contracts. 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 June 30 , 2016 and December 31, 2015: FAIR VALUE OF FINANCIAL INSTRUMENTS (Dollars in millions) June 30, 2016 Carrying Fair value amount Level 1 Level 2 Level 3 Total Sempra Energy Consolidated: Noncurrent due from unconsolidated affiliates (1) $ 179 $ ― $ 94 $ 77 $ 171 Total long-term debt (2)(3) 13,811 ― 14,933 572 15,505 Preferred stock of subsidiary 20 ― 25 ― 25 SDG&E: Total long-term debt (3)(4) $ 4,677 $ ― $ 5,055 $ 310 $ 5,365 SoCalGas: Total long-term debt (5) $ 3,009 $ ― $ 3,335 $ ― $ 3,335 Preferred stock 22 ― 27 ― 27 December 31, 2015 Carrying Fair value amount Level 1 Level 2 Level 3 Total Sempra Energy Consolidated: Noncurrent due from unconsolidated affiliates (1) $ 175 $ ― $ 97 $ 69 $ 166 Total long-term debt (2)(3) 13,761 ― 13,985 648 14,633 Preferred stock of subsidiary 20 ― 23 ― 23 SDG&E: Total long-term debt (3)(4) $ 4,304 $ ― $ 4,355 $ 315 $ 4,670 SoCalGas: Total long-term debt (5) $ 2,513 $ ― $ 2,621 $ ― $ 2,621 Preferred stock 22 ― 25 ― 25 (1) Excluding accumulated interest outstanding of $13 million and $11 million at June 30, 2016 and December 31, 2015, respectively. (2) Before reductions for unamortized discount (net of premium) and debt issuance costs of $111 million and $107 million at June 30, 2016 and December 31, 2015, respectively, and excluding build-to-suit and capital lease obligations of $385 million and $387 million at June 30, 2016 and December 31, 2015, 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 $310 million and $315 million at June 30, 2016 and December 31, 2015, respectively, related to Otay Mesa VIE. (4) Before reductions for unamortized discount and debt issuance costs of $47 million and $43 million at June 30, 2016 and December 31, 2015, respectively, and excluding capital lease obligations of $242 million and $244 million at June 30, 2016 and December 31, 2015, respectively. (5) Before reductions for unamortized discount and debt issuance costs of $28 million and $24 million at June 30, 2016 and December 31, 2015, respectively, and excluding capital lease obligations of $1 million both at June 30, 2016 and December 31, 2015. We determine the fair value of certain noncurrent amounts due from unconsolidated affiliates, long-term debt and preferred stock based on a market approach using quoted market prices for identical or similar securities in thinly-traded markets (Level 2). We value other noncurrent amounts due from unconsolidated affiliates of Sempra South American Utilities 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 c osts (Level 3). We value other long-term debt using an income approach based on the present value o f estimated future cash flows discounted at rates available for similar securities (Level 3). We provide the fair values for the securities held in the nucle ar decommissioning trust funds related to the San Onofre Nuclear Generating Station (SONGS) in Note 9 below. Non-Recurring Fair Value Measures – Sempra Energy Consolidated Sempra Natural Gas – Rockies Express As we discuss in Note 3, in March 2016, Sempra Natural Gas agreed 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 . In March 2016, we recorded a noncash impairment of our investment in Rockies Express of $44 million ($27 million after-tax). The charge is included in Equit y Earnings, Before Income Tax, on the Condensed Consolidated Statement of Operations for the six months ended June 30, 2016. We considered the sale price for our equity interest in Rockies Express to be a market participants’ view of the total value of Roc kies Express and measured the fair value of our investment based on the equity sale price. Use of this market participant input as the indicator of fair value is a Level 2 measurement in the fair value hierarchy. The following table summarizes significant inputs impacting non-recurring fair value measures related to our investment in Rockies Express: NON-RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Estimated Fair % of Inputs used to fair value fair value develop Range of value Valuation technique hierarchy measurement measurement inputs Investment in Rockies Express $ 440 (1) Market approach Level 2 100% Equity sale price 100% (1) At measurement date of March 29, 2016. |
CALIFORNIA UTILITIES' REGULATOR
CALIFORNIA UTILITIES' REGULATORY MATTERS | 6 Months Ended |
Jun. 30, 2016 | |
Regulated Operations [Abstract] | |
Sempra Utilities' Regulatory Matters | NOTE 9. SAN ONOFRE NUCLEAR GENERATING STATION (SONGS) SDG&E has a 20-percent ownership interest in SONGS, a nuclear generating facility near San Clemente, California, which ceased operations in June 2013. On June 6, 2013, after an extended outage beginning in 2012, Southern California Edison Company (Edison), the majority owner and operator of SONGS, notified SDG&E that it had reached a decision to permanently retire SONGS and seek approval from the Nuclear Regulatory Commission (NRC) to start the decommissioning activities for the entire facility. SONGS is subject to the jurisdiction of the NRC and the CPUC. SDG&E, and each of the other owners, holds its undivided interest as a tenant in common in the property. Each owner is responsible for financ ing its share of expenses and capital expenditures. SDG&E’s share of operating expenses is included in Sempra Energy’s and SDG&E’s Condensed Consolidated Statements of Operations. SONGS Steam Generator Replacement Project As part of the Steam Generator Re placement Project (SGRP), 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. Edison 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 . The replacement steam generators were designed and provided by Mitsubishi Heavy Industries, Ltd., Mitsubishi Nuclear Energy Systems, Inc., and Mitsubishi Heavy Industries Ame rica, 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 binding arbitration procee dings against MHI seeking damages as well. SDG&E is participating in the arbitration as a claimant and respondent. We discuss these proceedings in Note 11. Settlement Agreement to Resolve the CPUC’s Order Instituting Investigation (OII) into the SONGS Outa ge (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, including purchased re placement power costs, which are typically recovered through the Energy Resource Recovery Account (ERRA). In April 2014, SDG&E filed with the CPUC in the SONGS OII proceeding a Se ttlement Agreement, along with Edison, The Utility Reform Network ( TURN), th e CPUC Office of Ratepayer Advocates ( ORA) and two other intervenors who joined the Settlement Agreement (collectively, the Settling Parties). In September 2014, the Settling Parties executed an Amended and Restated Settlement Agreement (Amended Settlemen t Agreement), which amended the Settlement Agreement, and in November 2014, the CPUC issued a final decision approving the Amended Settlement Agreement. The Amended Settlement Agreement does not affect on-going or future proceedings before the NRC, or liti gation or arbitration related to potential future recoveries from third parties (except for the allocation to ratepayers of a ny recoveries as described below ) or proceedings addressing decommissioning activities and costs. We discuss the terms of the Amend ed Settlement Agreement and related filings in Note 13 of the Notes to Consolidated Financial Statements in the Annual Report . In April 2015, a petition for modification (PFM) was filed with the CPUC by Alliance for Nuclear Responsibility (A4NR), an interv enor in the SONGS OII proceeding, asking the CPUC to set aside its decision approving the Amended Settlement Agreement and reopen the SONGS OII proceeding . In June 2015, TURN , a party to the Amended Settlement Agreement , filed a response supporting the A4N R petition. TURN does not question the merits of the Amended Settlement Agreement , but is concerned that certain allegations regarding Edison raised by A4NR have undermined the public’s confidence in the regulatory process. SDG&E has responded that TURN’s concerns regarding public perception do not impact the reasonableness of the Amended Settlement Agreement and are insufficient to overturn it . In A ugust 2015 , ORA, also a party to the Amended Settlement Agreement, filed a PFM with the CPUC, withdrawing it s support for the Amended Settlement Agreement and asking the CPUC to reopen the SONGS OII proceeding. The ORA does not question the merits of the Amended Settlement Agreement, but is concerned with the CPUC’s approach toward recent disclosures concerning Edison ex parte communications with the CPUC. SDG&E responded that the ORA’s PFM is insufficient to overturn the Amended Settlement Agreement , because the ORA fails to make a case that the Amended Settlement Agreement is no longer in the public interest. I n May 2016, the CPUC issued a 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 accordance with t he ruling , Edison and S DG&E filed separate reports with the CPUC in June 2016 on the Amended Settlement Agreement and the status of its implementation , and filed separate legal briefs in July 2016 asserting that the Amended Settlement Agreement is reasonable and in the public interest. Accounting and Financial Impacts Through December 31, 2015 and June 30, 2016, the cumulative after-tax loss from plant closure recorded by Sempra Energy and SDG&E is $125 million, including a reduction in the after-tax loss of $13 million recorded in the first quarter of 2015. The remaining regul atory asset for the expected recovery of SONGS costs, consistent with the Amended Settlement Agreement, is $206 million ($45 million current and $161 million long-term) at June 30, 2016 and is recorded on the Condensed Consolidated Balance Sheets in Other Current Assets and Regulatory Assets Noncurrent, respectively, at Sempra Energy, and in Regulatory Assets Current and Other Regulatory Assets Noncurrent, respectively, at SDG&E . The amortization period prescribed for the regulatory asset is 10 years, which commence d in January 2015 following the CPUC’s final decision approving the Amended Settlement Agreement in November 2014. Settlement with Nuclear Electric Insurance Limited (NEIL) NEIL insures domestic and international nuclear utilities for the costs a ssociated with interruptions, damages, decontaminations and related nuclear risks. In October 2015, the SONGS co-owners (Edison, SDG&E and the City of Riverside) reached an agreement with NEIL to resolve all of SONGS’ insurance claims arising out of the fa ilures of the replacement steam generators for a total payment by NEIL of $400 million, SDG&E’s share of which is $80 million. Pursuant to the terms of the SONGS OII Amended Settlement Agreement, after reimbursement of legal fees and a 5-percent allocation to shareholders, the net proceeds of $75 million were allocated to ratepayers through ERRA. We discuss NEIL further in Note 11. Nuclear Decommissioning and Funding As a result of Edison’s decision to permanently retire SONGS Units 2 and 3, Edison has begu n the decommissioning phase of the plant. We discuss the process of decommissioning SONGS and oversight by the NRC in Note 13 of the Notes to Consolidated Financial Statements in the Annual Report. In accordance with state and federal requirements and reg ulations, SDG&E has assets held in trusts, referred to as the Nuclear Decommissioning Trusts (NDT), to fund decommissioning costs for SONGS Units 1, 2 and 3. Decommissioning of Unit 1, removed from service in 1992, is largely complete. The remaining work w ill be done when Units 2 and 3 are decommissioned. At June 30, 2016, the fair value of SDG&E’s NDT assets was $1.1 billion. Except for the use of funds for the planning of decommissioning activities or NDT administrative costs, CPUC approval is required fo r SDG&E to access the NDT assets to fund SONGS decommissioning costs for Units 2 and 3. In April 2016, the CPUC adopted a decision approving a total decommissioning cost estimate for SONGS Units 2 and 3 of $4.411 billion, of which SDG&E’s share is $89 9 million. The decision also approves an annual advice letter request process for SDG&E to request trust fund disbursements for decommissioning costs based on a forecast for 2016 and thereafter. Disbursements from the trust will then be made up to this annu al forecast amount as decommissioning expenses are incurred. All disbursements will be subject to future refund until a reasonableness review of the actual decommissioning costs is conducted, which would be no less frequently than every three years . SDG&E has received authorization from the CPUC to access trust funds for SONGS decommissioning costs of up to $218 million for 2013 through 2016 (forecasted) . The total of $218 million includes $ 75 million that is expected to be withdrawn pending satisfactory c larification by the Internal Revenue Service (IRS) that certain spent fuel costs and other costs are eligible decommissioning costs, payable from qualified nuclear decommissioning trusts. We are uncertain as to when such clarification will be provided . We discuss the NDT and matters related to its funding and the funding of decommissioning costs by the NDT further in Note 13 of the Notes to Consolidated Financial Statements in the Annual Report. We discuss matters related to spent nuclear fuel in Note 11 . Nuclear Decommissioning Trusts The amounts collected in rates for SONGS’ decommissioning are invested in externally managed trust funds. Amounts held by the trusts are invested in accordance with CPUC regulations. These trusts 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. The following table shows the fair values and gross unrealized gains and l osses 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) Gross Gross Estimated unrealized unrealized fair Cost gains losses value At June 30, 2016: Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies(1) $ 99 $ 5 $ ― $ 104 Municipal bonds(2) 150 13 ― 163 Other securities(2) 189 9 (6) 192 Total debt securities 438 27 (6) 459 Equity securities 221 416 (5) 632 Cash and cash equivalents 12 ― ― 12 Total $ 671 $ 443 $ (11) $ 1,103 At December 31, 2015: Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies $ 89 $ 2 $ ― $ 91 Municipal bonds 148 8 ― 156 Other securities 194 1 (13) 182 Total debt securities 431 11 (13) 429 Equity securities 214 412 (7) 619 Cash and cash equivalents 15 ― ― 15 Total $ 660 $ 423 $ (20) $ 1,063 (1) Maturity dates are 2017-2065. (2) Maturity dates are 2016-2115. 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 June 30, Six months ended June 30, 2016 2015 2016 2015 Proceeds from sales(1) $ 111 $ 127 $ 204 $ 221 Gross realized gains 5 4 8 6 Gross realized losses (3) (3) (11) (7) (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 . We provide additional information about SONGS in Note 11 . NOTE 10. CALIFORNIA UTILITIES' REGULATORY MATTERS We discuss regulatory matters affecting our California Utilities 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 . JOINT MATTERS CPUC General Rate Case (GRC) The CPUC uses a general rate case 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 . The California Utilities filed their 2016 General Rate Case (2016 GRC) applications in November 2014. In September 2015, the California Utilities filed settlement agreements with the CPUC to resolve all material matter s related to the proceeding, except for the revenue requirement implications of certain income tax benefits associated with flow-through tax repair deductions, discussed below. The settlement agreements were with eight of eleven intervening parties. In Ju ne 2016, the CPUC issued a final decision in the 2016 GRC. Th e final decision (2016 GRC F D) adopts substantially all of the terms of the settlement agreements entered into between SDG&E and SoCalGas and eight of the eleven intervening parties in the 2016 G RC. The 2016 GRC FD adopts two revenue requirement changes, the first of which, relating to the extension of bonus depreciation, is the only significant change to the settlement agreements. The second revenue requirement adjustment relates to income tax be nefits associated with flow-through repair deductions (the settling parties did not reach agreement on this second matter) . With these adjustments, the final decision adopts a 2016 revenue requirement of $1.7 91 billion for SDG&E , which is $ 20 million l ess than the $1.811 billion proposed in the settlement agreements. For SoCalGas , the final decision’s adjustments result in a 2016 revenue requirement of $2.204 billion , which is $ 15 million l ess than the $2.219 billion proposed in the settlement agreements . T he 2016 GRC FD also requires certain refunds to be paid to customers and establishes a two-way income tax expense memorandum account, each discussed below . Consistent with the settlement agreements, the 2016 GRC FD adopts subsequent annual escalation of th e adopted revenue requirements by 3.5 percent for years 2017 and 2018 and continuation of the Z-Factor mechanism for qualifying cost recovery. The Z-Factor mechanism allows the California Utilities to seek cost recovery of significant cost increases, under certain unforeseen circumstances, incurred between GRC filings, subject to a $5 million deductible per event. Also, the 2016 GRC FD denies a separate agreement between the ORA and the California Utilities requesting a four-year GRC period and instead adop ts a three -year GRC period (through 2018). The California Utilities recorded revenues in the first quarter of 2016 based on levels authorized for 2015 under the 2012 GRC, because a final decision in the 2016 GRC was not issued by March 31, 2016. The 2016 GRC FD is effective retroactive to January 1, 2016, and the California Utilities recorded the retroactive impacts in the second quarter of 2016. For SoCalGas and SDG&E , these amounts include an incremental after-tax earnings impact of $12 million and $9 m illion, respectively, related to the first quarter of 2016. The adopted revenue requirements associated with the seven-month period through July 2016 will be recovered in rates over a 17-month period, beginning August 2016. At June 30, 2016, SoCalGas is re porting on its Condensed Balance Sheet a regulatory asset of $60 million, with $21 million as noncurrent, representing the retroactive revenue from the 2016 GRC FD from January 1 through June 30, 2016 to be recovered in rates through December 2017. At June 30, 2016, SDG&E is reporting on its Condensed Consolidated Balance Sheet a regulatory asset of $23 million, with $8 million as noncurrent, representing the retroactive revenue from the 2016 GRC FD from January 1 through June 30, 2016 to be recovered in ra tes through December 2017. The 2016 GRC FD result s in certain accounting impacts associated with the income tax repairs deduction matter. In general, the 2016 GRC FD considers that the income tax benefits obtained from income tax repairs deductions exceeded amounts forecasted by the California Utilities from 2011 to 2015, and that they were attributed to shareholders during that time. The 2016 GRC FD reallocates the economic benefit of this tax deduction forecasting difference to ratepayers. Accordin gly, revenues corresponding to income tax repair deductions that exceeded forecasted amounts relating to 2015, which have been tracked in memorandum accounts, are ordered to be refunded to customers. The 2015 amounts total $72 million for SoCalGas and $37 million for SDG&E. Pursuant to this refund requirement, SoCalGas and SDG&E recorded regulatory liabilities for these amounts, resulting in after-tax charges to earnings of $ 43 million and $22 million , respectively, in the second quarter of 2016 ( summariz ed below). In addition, the 2016 GRC FD reduced rate base by $38 million at SoCalGas and $55 million at SDG&E. The corresponding reductions in the 2016 revenue requirement will be $5 million at SoCalGas and $7 million at SDG&E (which reductions are included in the adopted 2016 revenue requirement amounts described above). The rate base reductions reallocate to ratepayers the economic benefits associated with tax repair deductions that were previously provided to the shareholders for the period of 2012-2014 fo r SoCalGas and 2011-2014 for SDG&E. The rate base reductions do not result in an impairment of any of our reported assets, but will impact our revenues and earnings prospectively . The 2016 GRC FD also requires us to notify the CPUC if the 2012-2015 repair s deductions estimated in this GRC are different from the actual repairs deductions for SDG&E and SoCalGas . SoCalGas and SDG&E recorded regulatory liabilities of $11 million and $15 million , respectively, related to 2012-2014, resulting in after-tax charge s to earnings for these differences of $6 million and $9 million in the second quarter of 2016 for SoCalGas and SDG&E, respectively (summariz ed below ). SDG&E and SoCalGas will record any adjustments necessary related to estimated 2015 amounts when the info rmation to do so becomes available. In July 2016, SDG&E, SoCalGas and the parties to the settlement agreements filed a joint motion indicating their agreement to accept the CPUC’s adjustments to the original settlements with one additional change. The set tlement parties agree that SDG&E and SoCalGas shall retain the right to seek further review and modification of the bonus depreciation adjustment made by the CPUC, so that SDG&E and/or SoCalGas can pursue relief in the form of full or partial restoration o f the total revenue requirements reflected in the origi nal settlement agreements. We expect CPUC action on the joint motion in the second half of 2016 . Following is a summary of immediate earnings impacts from the 2016 GRC FD recorded in the second quarter of 2016: EARNINGS IMPACTS FROM THE 2016 GRC FD RECORDED IN THE SECOND QUARTER OF 2016 (Dollars in millions) SoCalGas SDG&E Pretax After-tax Pretax After-tax earnings earnings earnings earnings (charge) (charge) (charge) (charge) Retroactive revenue requirement increase for the first quarter of 2016 $ 20 $ 12 $ 15 $ 9 Adjustments to revenue related to tax repairs deductions: Refund of 2015 memorandum account $ (72) $ (43) $ (37) $ (22) True-up of 2012-2014 estimates to actuals (11) (6) (15) (9) Total $ (83) $ (49) $ (52) $ (31) Finally, the 2016 GRC FD requires the establishment of a two-way income tax expense memorandum account to track any revenue differences resulting from differences between the income tax expense forecasted in the GRC and the income tax expense incurred by the California Utilities from 2016 thr ough 2018. The differences tracked are to specifically include tax expense differences relating to net revenue changes ; mandatory tax law , tax accounting , tax procedural , or tax policy changes ; and elective tax law , tax a ccounting, tax procedural , or tax policy changes. The account will remain open, and the balance in the account will be reviewed in subsequent GRC proceedings , until the CPUC decides to close the account. In July 2016, to address the implem entation of the 2016 GRC FD, the California Utilities filed an advice letter to establish a two-way memorandum account to track revenue requirement differences resulting from the differences in the income tax expense forecasted in the GRC proceedings of SD G&E and SoCalGas and the income tax expense incurred by them during the GRC period. In the second quarter of 2016, SoCalGas and SDG&E each recorded a liability associated with tracking the differences in the income tax expense forecasted in the GRC proceed ings and the income tax expense that SoCalGas and SDG&E incurred for the six-month period ended June 30, 2016 , which resulted in after-tax charges to earnings of $9 million ($15 million pretax) for SoCalGas and a negligible amount for SDG&E. Natural Gas Pipeline Operations Safety Assessments In June 2014, the CPUC issued a final decision addressing SDG&E’s and SoCalGas ’ Pipeline Safety Enhancement Plan (PSEP) . Specifically, the decision determined the following for Phase 1 of the program : approved the utilities’ model for implementing PSEP; approved a process, including a reasonableness review, to determine the amount that the utilities will be authorized to recover from ratepayers for the interim costs incurred through the date of the fina l decision to implemen t PSEP, which is recorded in regulatory accounts authorized by the CPUC; approved balancing account treatment, subject to a reasonableness review, for incremental costs yet to be incurred to implement PSEP; and established the criteri a to determine the amounts that would not be eligible for cost recovery, including: certain costs incurred or to be incurred searching for pipeline test records, the cost of pressure testing pipelines installed after July 1, 1961 for which the company ha s not found sufficient records of testing, and any undepreciated balances for pipelines installed after 1961 that were replaced due to insufficient documentation of pressure testing. As a result of this decision, SoCalGas recorded an after-tax earnings ch arge of $5 million in 2014 for costs incurred in prior periods that were no longer subject to recovery. After taking the amounts disallowed for recovery into consideration, as of June 30 , 201 6 , SDG&E and SoCalGas have recorded PSEP costs of $ 15 million and $ 195 million, respectively, in the CPUC-authorized regulatory account . In October 2014, SDG&E and SoCalGas filed a petition with the CPUC requesting authority to begin to recover PSEP costs from customers in the year in which the costs are incurred, subj ect to refund pending the results of a reasonableness review by the CPUC, instead of recovery of such costs in a subsequent year. In July 2016, the CPUC issued a proposed decision addressing a number of outstanding requests and authorizing SoCalGas and SDG &E to recover, subject to refund pending reasonableness reviews, the revenue requirements associated with 50 percent of their incurred PSEP Phase 1 costs recorded to regulatory accounts ; file two reasonableness review applications for Phase 1 projects comp leted through 2017; file a Phase 2 revenue requirement forecast application for costs to be incurred in 2017 and 2018; and include in their 2019 GRC applications , and any future GRCs, all other PSEP costs not the subject of prior applications . We expect th e CPUC to issue a final decision in the proceeding in the third quarter of 2016 . In December 2014, SDG&E and SoCalGas filed an application with the CPUC for recovery of $0.1 million and $46 million, respectively, in costs recorded in the regulatory account through June 11, 2014. In June 2015, SDG&E and SoCalGas agreed to remove certain projects from the filing and defer their review to future proceedings when the projects are fully completed and, as a result, are now requesting recovery of $0.1 million and $26.8 milli on, respectively. The ORA, TURN and the Southern California Generation Coalition (SCGC) have recommended d isallowances related to completed projects, as well as facilities build-out costs, de-scoped projects, and project management and consulting costs. We expect a decision on this application in the second half of 2016 . In July 2014, the ORA and TURN filed a joint application for rehearing of the CPUC’s June 2014 final decision. In March 2015, the CPUC issued a decision denying the ORA’s and TURN’s second request for rehearing, but keeping the record open to admit additional evidence on the limited issue of pressure testing or replacing pipelines installed between January 1, 1956 and July 1, 1961. The ORA and TURN allege that the CPUC made a legal error in directing that ratepayers, not shareholders, be responsible for the costs associated with testing or rep lacing transmission pipelines that were installed between January 1, 1956 and July 1, 1961 for which the California Utilities do not have a record of a pressure test. In December 2015, the CPUC issued a final decision finding that ratepayers should not bea r the costs associated with pressure testing subject pipelines, or, if replaced, ratepayers should bear neither the average cost of pressure testing nor the undepreciated balance o f abandoned pipelines . In January 2016, SoCalGas and SDG&E jointly filed a r equest with the CPUC seeking rehearing of its December 2015 decision. In May 2016, the CPUC issued a decision denying the r equest for rehearing . Through June 30, 2016, the after-tax disallowed co sts for SoCalGas and SDG&E are $ 3.6 million and $0.5 million , respectively . SoCalGas and SDG&E expect to file an application with the CPUC in the third quarter of 2016 for reasonableness review and rate recovery of certain pipeline safety projects recorded in their authorized regulatory accounts. SoCalGas and SDG&E expect a decision from the CPUC in 2017 . SDG&E MATTERS SONGS We discuss regulatory and other matters related to SONGS in Note 9. Wildfire Claims Cost Recovery In September 2015, SDG&E filed an application with the CPUC requesting rate recovery of an estimated $379 million in costs related to the October 2007 wildfires that have been recorded to the Wildfire Expense Memorandum Account (WEMA). These costs represent a portion of the estimated total of $2.4 billion in costs and legal fees that SDG&E has incurred to resolve third-party damage claims arising from the October 2007 wildfires. The requested amount of $379 million is the net estimated cost incurred by SDG&E after deductions for insurance reimbursement ($1.1 billion), third party settlement recoveries ($824 million) and allocations to Federal Energy Regulatory Commission (FERC) -jurisdictional rates ($80 million), and refle cts a voluntary 10 percent shareholder contribution applied to the net WEMA balance ($42 million). SDG&E requested a CPUC decision by the end of 2016 and is proposing to recover the costs in rates over a six- to ten-year period. In April 2016, a ruling was issued establishing the scope and schedule for the proceeding, which will be managed in two phases. Phase 1 will address SDG&E’s operational and management prudence surrounding the 2007 wildfires. 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. Evidentiary hearings in Phase 1 are scheduled to be held in January 2017 , with a final decision scheduled to be issued in the second half of 2017. The procedural schedule for Phase 2 will be determined after Phase 1 is concluded . In September 2015, the presiding judge assigned by the FERC to SDG&E’s annual Electric Transmission Formula Rate filing (TO4 Formula Cycle 2) issued an initial decision and an order on sum mary judgment that authorized SDG&E to recover all of the costs incurred and allocated to SDG&E’s FERC-regulated operations, including $23.1 million of costs associated with the 2007 wildfires. In October 2015, the CPUC filed a request for rehearing of the FERC’s September 2015 order, which requested abeyance of SDG&E’s request to recover 2007 wildfire damage expenses. On April 21, 2016, the FERC affirmed its findings in the September 2015 order and denied the CPUC’s request for rehearing. The FERC decision finalizes SDG&E’s base transmission revenue requirement and the recovery of $23.1 million of wildfire damage expenses allocated to SDG&E’s FERC-regulated operations . We provide additional information about wildfire litigation costs and their recovery in Note 11. SOCALGAS MATTERS Aliso Canyon Natural Gas Storage Facility We discuss various regulatory matters regarding the Aliso Canyon natural gas storage facility and leak in Note 1 1 . Natural Gas Procurement In June 2016, SoCalGas filed an application for a gas cost incentive mechanism award of $5 million for natural gas procured for its core customers during the 12-month period ended March 31, 2016. We expect a CPUC decision in the first half of 2017. CALIFORNIA UTILITIES — MAJOR PROJECTS We discuss the California Utilities’ major projects in detail in Note 14 of the Notes to Consolidated Financial Statements in the Annual Report, and provide updates to those discussions and details in the tables below. MAJOR PROJECTS – UPDATES Joint Utilities Projects Southern Gas System Reliability Project (North-South Pipeline) § In July 2016, the CPUC issued a final decision which denies the California Utilities' request for a permit to construct. § In June 2016, SoCalGas recorded an after-tax impairment charge of $13 million for the development costs it had invested in the project. The pretax charge of $21 million is included in Operation and Maintenance on Sempra Energy's and SoCalGas' Condensed Consolidated Statements of Operations. We expect to make a filing to the CPUC seeking recovery of all or a portion of these costs. Pipeline Safety & Reliability Project § SDG&E and SoCalGas filed an amended application with the CPUC in March 2016 providing detailed analysis and testimony supporting the proposed project. The revised request also presents additional information on the costs and benefits of project alternatives, safety evaluation and compliance analysis, and statutory and procedural requirements. SDG&E and SoCalGas seek approval to construct the proposed project, estimated at a cost of $633 million, and authority to recover the associated revenue requirement in rates. SDG&E Projects Cleveland National Forest (CNF) Transmission Projects § In March 2016, the U.S. Forest Service issued a final decision authorizing issuance of the CNF Master Special Use Permit renewing SDG&E's land rights and authorizing the construction, operation and maintenance of facilities located on national forest lands for the next 50 years, as well as approving the majority of the fire-hardening activities proposed by SDG&E. § In May 2016, the CPUC issued a final decision granting SDG&E a permit to construct. The project will be installed at an estimated cost of $680 million: $470 million for the various transmission-level facilities and $210 million for associated distribution-level facilities, including distribution circuits and additional undergrounding required by the final environmental impact statement. In July 2016, the Cleveland National Forest Foundation and the Protect Our Communities Foundation filed a joint application for rehearing of the final decision. Sycamore-Peñasquitos Transmission Project § March 2016 final environmental impact report (EIR) recommended an alternative that undergrounds more of the project than originally proposed, and is viewed as environmentally superior. The CPUC may consider this alternative. § The recommended alternative in the EIR has an estimated cost of $250 million to $300 million, compared to the original project cost estimate of $120 million to $150 million, and would also delay the project schedule by approximately 10 months. § CPUC decision expected in the second half of 2016. South Orange County Reliability Enhancement § CPUC issued its final EIR for the project in April 2016. The EIR concluded that an alternative project is considered environmentally superior to SDG&E's proposal. The final EIR states that the CPUC is not required to adopt the environmentally superior alternative |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | NOTE 11. 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 material ly 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 June 30, 2016, Sempra Energy’s acc rued liabilities for legal proceedings, including associated legal fees and costs of litigation, on a consolidated basis, were $44 million. At June 30, 2016, accrued liabilities for legal proceedings were $21 million for SDG&E and $21 million for SoCalGas . Amount s for Sempra Energy and SoCalGas include $21 million for matters related to the Aliso Canyon natural gas leak, which we discuss below SDG&E 2007 Wildfire Litigation In October 2007, San Diego County experienced several catastrophic wildfires. Reports issued by the California Department of Forestry and Fire Protection (Cal Fire) concluded that two of these fires (the Witch and Rice fires) were SDG&E “power line caused” and that a third fire (the Guejito fire) occurred when a wire securing a Cox Communications’ (Cox) fiber optic cable came into contact with an SDG&E power line “causing an arc and starting the fire.” A September 2008 staff report issued by the CPUC’s Consumer Protection and Safety Division, now known as the Safety and Enforcement Division, reached substantially the same conclusions as the Cal Fire reports, but also contended that the power lines involved in the Witch and Rice fire s and the lashing wire involved in the Guejito fire were not properly designed, constructed and maintained. Numerous parties sued SDG&E and Sempra Energy in San Diego County Superior Court seeking recovery of unspecified amounts of damages, including punit ive damages, from the three fires. They asserted various bases for recovery, including inverse condemnation based upon a California Court of Appeal decision finding that another California investor-owned utility was subject to strict liability, without reg ard to foreseeability or negligence, for property damages resulting from a wildfire ignited by power lines. SDG&E has resolved almost all of these lawsuits. One case remains subject to a damages-only trial, where the value of any compensatory damages res ulting from the fires will be determined. Two appeals are 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 plaintiff until the case is resolved. SDG&E establishes reserves for the wildfire litigation as information becomes available and amounts are estimable. SDG&E has concluded that it is probable that it will be permit ted 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 June 30, 2016, Sempra Energy and SDG&E have recorded assets of $355 million in Other Regulatory Assets (long-term) on their Condensed Consolidated Balance Sheets, including $353 million related to CPUC-regulated operations, which represents the amount substantially equal to the aggregate amou nt it has paid a nd reserved for payment for the resolution of wildfire claims and related costs in excess of its liability insurance coverage and amounts recovered from third parties. On September 25, 2015, SDG&E filed an application with the CPUC seeking authority to rec over these costs, as we discuss in Note 10. 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 asset s related to CPUC-regulated operations was no longer probable or was less than currently estimated at June 30, 2016, the resulting after-tax charge against earnings would have been up to approximately $210 million. A failure to obtain substantial or full r ecovery of these costs from customers, or any negative assessment of the likelihood of recovery, would likely have a material adverse effect on Sempra Energy’s and SDG&E’s results of operations and cash flows. We provide additional information about excess wildfire claims cost recovery and related CPUC actions in Note 14 of the Notes to Consolidated Financial Statements in the Annual Report and 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. Smart Meters Patent Infringement Lawsuit In October 2011, SDG&E was sued by a Texas design and manufacturing company in Federal District Court, Southern District of California, and later transferred to the Federal District Court, Western District of Oklahoma as part of Multi-District Litigation (MDL) proceedings, alleging that SDG&E’s recently installed smart meters infringed certain patents. The meters were purchased from a third party vendor that has agreed to defend and indemnify SDG&E. The lawsuit sought injunctive relief and recovery of unspe cified amounts of damages . The third party vendor has settled the lawsuit without cost to SDG&E, and a dismissal was entered in federal court on July 20, 2016 . Lawsuit Against Mitsubishi Heavy Industries, Ltd. On July 18, 2013, SDG&E filed a lawsuit in the Superior Court of California in the County of San Diego against Mitsubishi Heavy Industries, Ltd., Mitsubishi Nuclear Energy Systems, Inc., and Mitsubishi Heavy Industries America, Inc. (collectively MHI). The lawsuit seeks to recover damages SDG&E has incurred and will incur related to the design defects in the steam generators MHI provided to the SONGS nuclear power plant. The lawsuit asserts a number of causes of action, including fraud, based on the repr esentations MHI made about its qualifications and ability to design generators free from defects of the kind that resulted in the permanent shutdown of the plant and further seeks to set aside the contractual limitation of damages that MHI has asserted. On July 24, 2013, MHI removed the lawsuit to the United States District Court for the Southern District of California and on August 8, 2013, MHI moved to stay the proceeding pending resolution of the dispute resolution process involving MHI and Edison arisin g from their contract for the purchase and sale of the steam generators. On October 16, 2013, Edison initiated an arbitration proceeding against MHI seeking damages stemming from the failure of the replacement steam generators. In late December 2013, MHI a nswered and filed a counterclaim against Edison. On March 14, 2014, MHI’s motion to stay the United States District Court proceeding was granted with instructions that require the parties to allow SDG&E to participate in the ongoing Edison/MHI arbitration. As a result, SDG&E participated in the arbitration as a claimant and respondent . The arbitration hearing concluded at the end of April 2016, and a decision could come as early as this year. Rim Rock Wind Farm In 2011, the CPUC and FERC approved SDG&E’s estimated $285 million tax equity investment in a wind farm project and its purchase of renewable energy credits from that project. SDG&E’s contractual obligations to both invest in the Rim Rock wind farm and to purchase renewable energy credits from the wind farm under the power purchase agreement were subject to the satisfaction of certain conditions which, if not achieved, would allow SDG&E to terminate the power purchase agreement and not make the investment. In December 2013, SDG&E and the project developer began litigating claims against each other regarding whether the project developer had timely satisfied all contractual conditions necessary to trigger SDG&E’s obligations to invest in the project and purchase renewable energy credits. On February 11, 2016, SDG&E, the project developer and several of the project developer’s parent and affiliated entities entered into a conditional settlement agreement, which was approved by the CPUC in July 2016 and will become final and non-appealable 30 days after the CPUC approval, provided that no party requests rehearing. Under the settlement agreement, among other things, the parties agreed to terminate the tax equity investment arrangement, contin ue the power purchase agreement for the wind farm generation and release all claims against each other, while generally continuing the other elements of the 2011 approved decision. The settlement agreement will result in a $39 million credit to ratepayers . 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 more than one mile away from and 1,200 feet above the closest homes. It 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 w ith several of the world’s leading experts to stop the leak, including planning and obtaining all necessary approvals for drilling relief wells. On February 18, 2016, the California Department of Conservation’s Division of Oil, Gas, and Geothermal Resource s (DOGGR) confirmed that the well was permanently sealed. On December 24, 2015, by stipulation and court order, SoCalGas agreed to implement a formal plan for assisting residents in the nearby community to temporarily relocate, as well as to pay for additi onal overtime and costs associated with extra Los Angeles Police Department security patrols, among other things. SoCalGas provid ed temporary relocation support to residents in the nearby community who requested it before the well was permanently sealed. I n addition, SoCalGas provided air filtration and purification systems to those residents in the nearby community requesting them. As a result of receiving the confirmation from DOGGR that SS25 was permanently sealed, SoCalGas started winding down its temp orary relocation support in accordance with the terms of the formal relocation plan. Subject to certain exceptions, the period for temporary relocation support to residents who temporarily relocated to short-term housing, such as hotels, was scheduled to e nd on February 25, 2016. This deadline was challenged by the Los Angeles County Department of Public Health (DPH), which contended that indoor testing was required to determine whether it was safe for residents to return home. In mid-March 2016, a third pa rty engaged by SoCalGas conducted screening of indoor air for methane and mercaptans (odorants added to natural gas) in 71 houses in the Porter Ranch community near the Aliso Canyon storage facility. No mercaptans were detected in this screening, and conce ntrations of methane were well below levels of concern as established by the California Environmental Protection Agency’s Department of Toxic Substances Control. On March 24, 2016, the DPH released its indoor sampling work plan to test approximately 100 ho uses for a broad range of chemicals, including volatile organic compounds, semi-volatile organic compounds, metals, and sulfur compounds in the air and on surfaces. These substances are commonly found in households at varying levels. On April 27, 2016, the California Superior Court issued an order extending the relocation support term pending the completion of the DPH’s indoor testing. The DPH took samples from more than 100 homes and certain schools, as well as 11 “control” homes outside the Porter Ranch C ommunity, and tested for over 250 chemical substances, and on May 13, 2016 issued its report of the results, which concluded that the testing did not detect chemicals at levels that presented an elevated health risk, and that the occurrence of air contamin ants was consistent with background levels for indoor settings. The DPH’s report stated that certain metals had been detected in surface dust in a small number of homes tested. Although the levels of any such metals were found to be significantly below lev els established as safe by the U.S. Environmental Protection Agency (EPA) and even though such metals were also found in homes outside the Porter Ranch Community that were tested as a control group, the DPH nevertheless asserted that the detection of such substances required the homes of relocated residents to be cleaned before the relocation program could end. In response, the Superior Court issued an order on May 20, 2016, as supplemented by the Superior Court on May 25, 2016, ruling that: (1) currently relocated residents be given the choice to request residence cleaning, to be performed according to the DPH’s proposed protocol and at SoCalGas ’ expense, and (2) the relocation program for currently relocated residents would terminate. In accordance with t he May 20 and May 25 orders, SoCalGas finished cleaning all homes covered by this order on July 6, 2016, or approximately 1,500 homes. As of July 24, 2016, the relocation program has ended. Apart from the Superior Court order, on May 13, 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 have participated in the relocation progr am, 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 does not believe that the DPH has the authority to issue the Directive and h as 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 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 oper ations. Cost Estimates and Accounting Impact. At June 30, 2016, SoCalGas recorded estimated costs of $717 million related to the leak. Of this amount, approximately 70 percent is for the temporary relocation program (including cleaning costs and certain la bor costs) and approximately 15 percent is for attempts to control the well, stop the leak, stop or reduce the emissions, and the estimated cost of the root cause analysis being conducted to determine the cause of the leak. The remaining portion of the $71 7 million includes estimated legal costs necessary 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 made a commitment in December 2015 to mitigate the actual natural gas released and has been working on a plan to accomplish the mitigation. The $717 million represents mana gement’s best estimate of these costs related to the leak. Of these costs, a substantial portion has been paid and $117 million is recorded as Reserve for Aliso Canyon Costs at June 30, 2016 on SoCalGas ’ and Sempra Energy’s Condensed Consolidated Balance S heets for amounts expected to be paid after June 30, 2016. At June 30, 2016, we recorded the expected recovery of the costs described in the immediately preceding paragraph related to the leak of $679 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 $34 million of insurance proceeds we received in the second quarter of 2016 related to control of well expenses. If we were to conclude t hat 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 Sempra Energy’s and SoCalGas ’ financial condition and r esults of operations. The above amounts do not include any damage awards, restitution, or any civil or criminal fines, costs or other penalties that may be imposed, as it is not possible to predict the outcome of any criminal or civil proceeding or any adm inistrative action in which such damage awards, restitution or civil or criminal fines, costs or other penalties could be imposed, and any such amounts, if awarded or imposed, cannot be reasonably estimated at this time. In addition, the above amounts do n ot include the cost to clean additional homes as directed by the DPH and other potential costs that we currently do not anticipate incurring or that we cannot reasonably estimate. On March 17, 2016, the CPUC issued a decision directing SoCalGas to establis h a memorandum account to prospectively 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. The CPUC will determine at a later time whethe r, and to what extent, the tracked revenues may be refunded to ratepayers. Pursuant to the CPUC’s decision, on March 24, 2016, SoCalGas filed an advice letter requesting to establish a memorandum account to track all business-as-usual costs to own and oper ate the Aliso Canyon storage field, which has been protested by TURN and SCGC. On April 22, 2016, the CPUC’s Energy Division issued a suspension notice for SoCalGas ’ advice letter citing the need for additional time for staff review. Insurance. We have at least four kinds of insurance policies that provide in excess of $1 billion in insurance coverage. 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. In reviewing each of our p olicies, and 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: the costs incurred f or 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 and estimated cost s to mitigate the actual natural gas released, the costs associated with litigation and claims by nearby residents and businesses, the cost to clean additional homes as directed by the DPH, 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 recently received an insurance payment for control of well costs. We intend to pursue the full extent of our insurance coverage for the cos ts 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, it could result in a material charge against the earnings of SoCalGas and Sempra Energy. Our estimate at June 30, 2016 of $717 million of certain costs in connection with the Aliso Canyon storage facility leak may rise significantly as more information becomes available, 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 Sempra Energy’s and SoCalGas ’ cash flows, financial condi tion and results of operations. In addition, any costs not included in the $717 million estimate could be material, and to the extent not covered by insurance (including any costs in excess of applicable policy limits), could have a material adverse effect on Sempra Energy’s and SoCalGas ’ cash flows, financial condition and results of operations. Governmental Investigations and Civil and Criminal Litigation . Various governmental agencies, including the DOGGR, DPH, South Coast Air Quality Management District (SCAQMD), California Air Resources Board (CARB), Los Angeles Regional Water Quality Control Board (RWQCB), California Division of Occupational Safety and Health (DOSH), CPUC, Pipeline and Hazardous Materials Safety Administration (PHMSA), EPA, Los Angeles District Attorney’s Office and California Attorney General’s Office, are investigating this incident. On January 25, 2016, the DOGGR and CPUC selected Blade Energy Partners to conduct an independent analysis under their supervision and to be funded by SoC alGas to investigate the technical root cause of the Aliso Canyon gas leak. We expect the root cause analysis to be completed in late 2016 or early 2017, but the timing is dependent on the DOGGR and the CPUC. As of July 28, 2016, 1 81 lawsuits have been fil ed ( 177 in Los Angeles County Superior Court, 2 in San Diego County Superior Court, and 2 in the United States District Court for the Southern District of California) against SoCalGas , some of which have also named Sempra Energy, and, in derivative and sec urities law claims on behalf of Sempra Energy and/or SoCalGas , against certain officers and directors of Sempra Energy and/or SoCalGas . These various lawsuits assert causes of action for negligence, negligence per se, strict liability, property damage, fra ud, public and private nuisance (continuing and permanent), trespass, breach of fiduciary duties, inverse condemnation, fraudulent concealment, loss of consortium, and violation of federal securities laws, among other things, and additional litigation may be filed against us in the future related to this incident. Many of these complaints seek class action status, compensatory and punitive damages, injunctive relief, costs of future medical monitoring and attorneys’ fees. Pursuant to the parties’ agreement, the court ordered that the individual and business entity plaintiffs would proceed by filing two consolidated master complaints, one for the individual tort cases, and a second for the class action cases. The Los Angeles City Attorney and Los Angeles Coun ty Counsel have also filed a complaint on behalf of the people of the State of California against SoCalGas for public nuisance and violation of the California Unfair Competition Law. The California Attorney General , acting in her independent capacity and o n behalf of the people of the State of California and the CARB, joined this lawsuit. The complaint, as amended includes allegations of violations of California Health and Safety Code sections 41700, prohibiting discharge of air contaminants that cause anno yance 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. The SCAQMD also filed a complaint against SoCalGas seeking civil penalties for alleged violations of several nuisance-related statutory provisions arising from the leak and delays in stopping the leak. That suit seeks up to $250,000 in civil penalties for each day the violations occurred. On July 13, 2016, the SCAQMD amended its complaint to seek a declaration that SoCalGas is required to pay the costs of a longitudinal study of the health of pers ons exposed to the gas leak. All of these cases , other than the derivative and securities law claims , are coordinated before a single court in the Los Angeles County Superior Court for pretrial management. As ordered by the court in the coordination proceedi ng, on July 25, 2016 , the individuals and business entities asserting tort claims filed a Consolidated 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 and loss of conso rtium against SoCalGas , with certain causes also naming Sempra Energy . The consolidated complaint seeks compensatory and punitive damages for personal injuries, property damage and diminution in property value, a temporary injunction, costs of future medic al monitoring, and attorneys’ fees. On February 2, 2016, the Los Angeles 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 27 03(a), and for violating California Health and Safety Code section 41700 prohibiting discharge of air contaminants that cause annoyance to the public. On February 16, 2016, SoCalGas pled not guilty to the complaint. No trial date has been set. On July 25, 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 le ase, and damages. This suit alleges that the four natural gas storage fields operated or formerly operated by SoCalGas in Los Angeles County require safety upgrades, including the installation of sub-surface safety shut-off valves on every well. It additio nally alleges that SoCalGas failed to comply with the 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. The costs of defending against these civil and criminal lawsuits and cooperating with these investigations, and any damages, restitution, and civil and criminal fines, costs and other penalties, if awarded or imposed, 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, could have a material adverse effect on SoCalGas ’ and Sempra Energy’s cash flows, financial condition an d results of operations. Governmental Orders, Additional Regulation and Reliability. On January 6, 2016, the Governor of the State of California issued the Governor’s 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 directs the following: Protecting Public Health and Safety : State agencies will: continue the prohibition against SoCalGas injecting any gas into the Aliso Canyon storage facility until a comprehensive review, utilizing independent experts, of the safety of the storage wells and the air quality of the surrounding community is completed; expand real-time monitoring of emission s in the surrounding community; 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; and take all ac tions necessary to ensure the continued reliability of natural gas and electricity supplies in the coming months during the moratorium on gas injections into the Aliso Canyon storage facility. Ensuring Accountability : The CPUC will ensure that SoCalGas cov ers costs related to the natural gas leak and its response, while protecting ratepayers; and CARB will develop a program to fully mitigate the leak’s emissions of methane by March 31, 2016, with such program to be funded by SoCalGas . Strengthening Oversigh t : The DOGGR will promulgate emergency regulations for gas storage facility operators throughout the state, requiring: at least daily inspection of gas storage well heads using gas leak detection technology such as infrared imaging; ongoing verification of the mechanical integrity of all gas storage wells; ongoing measurement of annular gas pressure or annular gas flow within wells; regular testing of all safety valves used in wells; minimum and maximum pressure limits for each gas storage facility in the s tate; and a comprehensive risk management plan for each facility that evaluates and prepares for risks, including corrosion potential of pipes and equipment. Additionally, the DOGGR, CPUC, CARB and California Energy Commission (CEC) will submit to the Gove rnor’s Office a report that assesses the long-term viability of natural gas storage facilities in California. SoCalGas made a commitment in December 2015 to mitigate the actual natural gas released from the leak and has been working on a plan to accomplish the mitigation. On March 31, 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 Can yon natural gas leak. The CARB program preliminarily assumes that the leak released approximately 100,000 metric tons of methane. It states that full mitigation requires that the program generate reductions in short-lived climate pollutants and other green house gases at least equivalent to that amount and that the appropriate global warming potential to be used in deriving the amount of reductions required is a 20-year term rather than the 100-year term the CARB and other state and federal agencies use in r egulating emissions, resulting in a target of approximately 8,000,000 metric tons of carbon dioxide equivalent. CARB’s program also requires all of the mitigation to occur in California over the next five to ten years without the use of allowances or offse ts. We have not agreed to this proposed formulation and continue to work with CARB on the mitigation plan. On January 23, 2016, the Hearing Board of the SCAQMD ordered SoCalGas to, among other things: stop all injections of natural gas except as directed b y the CPUC, withdraw the maximum amount of natural gas feasible in a contained and safe manner, subject to orders of the CPUC, and permanently seal the well once the leak has ceased; continuously monitor the well site with infrared cameras until 30 days af ter the leak has ceased; provide the public with daily air monitoring data collected by SoCalGas ; provide the SCAQMD with certain natural gas injection, withdrawal and emissions data from the Aliso Canyon facility; prepare and submit to the SCAQMD for its approval an enhanced leak detection and reporting well inspection program for the Aliso Canyon facility; provide the SCAQMD with funding to develop a continuous air monitoring plan for the Aliso Canyon facility and the nearby schools and community; prepare and submit to the SCAQMD for its approval an air quality notification plan to provide notice to SCAQMD, other public agencies and the nearby community in the event of a future reportable release; and provide the SCAQMD with funding to conduct an independe nt health study on the potential impacts of exposure on the constituents of the natural gas released from the facility, as well as any odor suppressants used to mitigate odors from the leaking well. On April 1, 2016, the Secretary of the U.S. Department of Energy (DOE) and PHMSA jointly announced the formation of an Interagency Task Force on Natural Gas Storage Safety in response to the leak at Aliso Canyon to assess and make recommendations on best practices, response plans and safe operation of gas storag e facilities. On June 22, 2016, President Obama signed the “Protecting our Infrastructure of Pipelines and Enhancing Safety Act o |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2016 | |
Segment [Abstract] | |
Segment Information | NO TE 12 . 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 gen eration infrastructure in Chile and Peru. Sempra Mexico develops, owns and operates, or holds interests in, natural gas transmission pipelines and propane and ethane systems, a natural gas distribution utility, electric generation facilities (including win d), 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 Mexi cali, Baja California, as we discuss in Note 3. Sempra Renewables develops, owns and operates, or holds interests in, wind and solar energy projects in Arizona, California, Col orado, Hawaii, Indiana, Kansas, Michigan , Minnesota, Nebraska , Nevada and Pennsylvania to serve whole sale electricity markets in the United States. Sempra Natural Gas develops, owns and operates, or holds interests in, natural gas pipelines and storage facilities, natural gas distribution utilities and a terminal f or the import and export of LNG and sale of natural gas, all within the United States. In May 2016, Sempra Natural Gas completed the sale of its 25-percent interest in Rockie s Express, as we discuss in Note 3. In April 2016, we entered into an agreement to sell EnergySouth , the parent company of Mobile Gas and Willmut Gas, the two natural gas distribution utilities owned by Sempra Natural Gas, as we discuss in Note 3. Sempra Natural Gas also owned and operated the Mesquite Power plant, a natural gas-fired electric generation asset, the remaining 625-MW block of which was sold in April 2015. Sempra South American Utilities and Sempra Mexico comprise our Sempra International operating unit. Sempra Renewables and Sem pra Natural Gas comprise our Sempra U.S. Gas & Power operating unit. 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 Fina ncial 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 intercompan y 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 a s “All other” in the following tables consist primarily of parent organizations. SEGMENT INFORMATION (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 REVENUES SDG&E $ 992 46 % $ 972 41 % $ 1,983 41 % $ 1,938 38 % SoCalGas 617 29 780 33 1,650 35 1,828 36 Sempra South American Utilities 385 18 389 16 785 16 778 15 Sempra Mexico 147 7 152 6 285 6 315 6 Sempra Renewables 6 ― 10 1 13 ― 18 1 Sempra Natural Gas 90 4 155 7 220 5 352 7 Adjustments and eliminations ― ― (1) ― ― ― (1) ― Intersegment revenues(1) (81) (4) (90) (4) (158) (3) (179) (3) Total $ 2,156 100 % $ 2,367 100 % $ 4,778 100 % $ 5,049 100 % INTEREST EXPENSE SDG&E $ 48 $ 52 $ 96 $ 104 SoCalGas 24 19 46 38 Sempra South American Utilities 11 8 20 13 Sempra Mexico 4 6 8 11 Sempra Renewables ― 1 ― 2 Sempra Natural Gas 10 23 22 44 All other 74 65 146 128 Intercompany eliminations (29) (35) (53) (67) Total $ 142 $ 139 $ 285 $ 273 INTEREST INCOME SoCalGas $ ― $ 3 $ ― $ 3 Sempra South American Utilities 5 5 10 9 Sempra Mexico 1 2 3 4 Sempra Renewables ― 1 1 1 Sempra Natural Gas 17 25 33 44 Intercompany eliminations (17) (26) (35) (44) Total $ 6 $ 10 $ 12 $ 17 DEPRECIATION AND AMORTIZATION SDG&E $ 158 50 % $ 149 48 % $ 317 49 % $ 294 48 % SoCalGas 112 36 113 37 234 36 226 37 Sempra South American Utilities 14 4 12 4 27 4 25 4 Sempra Mexico 15 5 17 6 32 5 34 6 Sempra Renewables 2 1 1 ― 3 1 3 ― Sempra Natural Gas 12 4 12 4 25 4 24 4 All other 1 ― 3 1 4 1 4 1 Total $ 314 100 % $ 307 100 % $ 642 100 % $ 610 100 % INCOME TAX EXPENSE (BENEFIT) SDG&E $ 48 $ 54 $ 120 $ 142 SoCalGas (29) 16 58 111 Sempra South American Utilities 15 18 29 34 Sempra Mexico (12) 5 29 13 Sempra Renewables (9) (11) (21) (28) Sempra Natural Gas (99) 27 (124) 29 All other (20) (11) (55) (40) Total $ (106) $ 98 $ 36 $ 261 SEGMENT INFORMATION (CONTINUED) (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 EQUITY EARNINGS (LOSSES) Earnings (losses) recorded before tax: Sempra Renewables $ 11 $ 10 $ 18 $ 12 Sempra Natural Gas 3 17 (26) 34 Total $ 14 $ 27 $ (8) $ 46 Earnings (losses) recorded net of tax: Sempra South American Utilities $ ― $ ― $ 2 $ (1) Sempra Mexico 33 22 48 38 Total $ 33 $ 22 $ 50 $ 37 EARNINGS (LOSSES) SDG&E $ 100 $ 126 $ 229 $ 273 SoCalGas(2) (1) 70 194 284 Sempra South American Utilities 43 45 81 86 Sempra Mexico 57 50 74 97 Sempra Renewables 12 19 25 32 Sempra Natural Gas (149) 40 (185) 42 All other (46) (55) (83) (82) Total $ 16 $ 295 $ 335 $ 732 Six months ended June 30, 2016 2015 EXPENDITURES FOR PROPERTY, PLANT & EQUIPMENT SDG&E $ 602 30 % $ 600 41 % SoCalGas 650 32 603 41 Sempra South American Utilities 82 4 66 5 Sempra Mexico 140 7 120 8 Sempra Renewables 457 23 22 1 Sempra Natural Gas 68 3 28 2 All other 7 1 27 2 Total $ 2,006 100 % $ 1,466 100 % June 30, 2016 December 31, 2015 ASSETS SDG&E $ 17,039 40 % $ 16,515 40 % SoCalGas 13,086 30 12,104 29 Sempra South American Utilities 3,486 8 3,235 8 Sempra Mexico 3,925 9 3,783 9 Sempra Renewables 1,838 4 1,441 4 Sempra Natural Gas 5,396 13 5,566 13 All other 803 2 734 2 Intersegment receivables (2,698) (6) (2,228) (5) Total $ 42,875 100 % $ 41,150 100 % EQUITY METHOD AND OTHER INVESTMENTS Sempra South American Utilities $ (1) $ (4) Sempra Mexico 548 519 Sempra Renewables 827 855 Sempra Natural Gas 818 1,460 All other 75 75 Total $ 2,267 $ 2,905 (1) Revenues for reportable segments include intersegment revenues of a negligible amount, $18 million, $27 million and $36 million for the three months ended June 30, 2016; $3 million, $35 million, $54 million and $66 million for the six months ended June 30, 2016; $3 million, $17 million, $24 million and $46 million for the three months ended June 30, 2015; and $5 million, $36 million, $49 million and $89 million for the six months ended June 30, 2015 for SDG&E, SoCalGas, Sempra Mexico and Sempra Natural Gas, respectively. (2) After preferred dividends. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Significant Accounting Policies | |
New Accounting Standards Policy | N OTE 2. NEW ACCOUNTING STANDARDS We describe below recent pronouncements that have had or may have a significant effect on our financial statements. We do not discuss recent pronouncements that are not anticipated to have an impact on or are unrelated to our financial condition, results of operations, cash flows or disclosures. SEMPRA ENERGY, SDG&E AND SOCALGAS 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 f or 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 n onfinancial 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 p ermits 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 perio ds in the year of adoption. We are currently evaluating the effect of the standards on our ongoing financial reporting and have not yet selected the timing of adoption or our transition method . 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 not 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 tho se 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 value 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 effectiv e for fiscal years beginning after December 15, 2017. We will adopt ASU 2016-01 on January 1, 2018 as required and do not expect it to materially affect our financial condition, results of operations or cash flows. We will make the required changes to our disclosures upon adoption. 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 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 qualitative disclosures along with specific q uantitative 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 standar d 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 recognize 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 . ASU 2016-05, “Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships”: ASU 2016-05 provides clarification that a change in the counterparty to a derivative instrument that has been designated as a hedging instrument does not, in and of itse lf, require dedesignation of that hedging relationship provided that all other hedge accounting criteria continue to be met. ASU 2016-05 may be adopted prospectively or using a modified retrospective approach. We prospectively adopted ASU 2016-05 on Januar y 1, 2016, and it did not affect our financial condition, results of operations or cash flows. 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 from operating to financing activities on the statement of cash flo ws 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 taxi ng authorities in connection with withheld shares should be classified as financing activities in the statement of cash flows. Additionally, the standard provides for an accounting policy election to either continue to estimate forfeitures or account for them as they occur. For public entities, ASU 2016-09 is effective for fiscal years beginning after December 15, 2016, with early adoption permitted, and is effective for interim periods in the year of adoption. We are currently evaluating the full effect of the standard on our ongoing financial reporting, and have not yet concluded as to whether we will elect an early adoption. If we early adopt in 2016, we will recognize a $34 million tax benefit in earnings, which is currently recorded in Shareholders’ Equity, related to the six month s ended June 30, 2016, and a benefit to retained earnings as of January 1, 2016 of approximately $107 million, both associated with the provision in ASU 2016-09 to recognize all excess tax benefits related to share-based compensation. ASU 2016-13 , “ Measure ment 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 all owance 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 fi scal 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. |
Consolidation Variable Interest Entity Policy | 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 upon 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 | 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 compre hensive income or loss attributable to noncontrolling interests is separately identified on the Condensed Consolidated Statements of Comprehensive Income (Loss). |
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. The dilution from common stock options is based on the treasury stock method. Under this method, proceeds based on the exercise price plus unearned compensation and windfall tax benefits recognized , minus tax shortfalls recognized , are assumed to be used to repurchase shares on the open market at the average market price for the period. The windfall tax benefits are tax deductions we would receive upon the assumed exercise of stock options in excess of the deferred income taxes we recorded related to the c ompensation expense on the stock options. Tax shortfalls occur when the assumed tax deductions are less than recorded deferred income taxes. The calculation of dilutive common stock equivalents excludes options for which the exercise price on common stock was greater than the average market price during the period (out-of-the-money options). The dilution from unvested restricted stock award s (RSAs) and restricted stock units (RSUs) is also based on the treasury stock method. Proceeds equal to the unearned compensation and windfall tax benefits recognized , minus tax shortfalls recognized , related to the awards and units are assumed to be used to repurchase shares on the open market at the average market price for the period. The windfall tax benefits or tax shortfalls recognized are the difference between tax deductions we would receive upon the assumed vesting of RSAs or RSUs and the deferred income taxes we recorded related to the compensation expense on such awards and units. Our performance-based RSUs include awards that vest at the end of three-year (for awards granted during or after 2015) or four-year performance periods based on Sempra Energy’s total return to shareholders relative to that of specified market indices (Total Shareholder Return or TSR RSUs) or based on the compound annual growth rate of Sempra Energy’s EPS (EPS RSUs). The comparative market indices for the TSR RSUs are the Standard & Poor’s (S&P) 500 Utilities Index and the S&P 500 Index. We primarily use long-term analyst consensus growth estimates for S&P 500 Utilities Index peer companies to develop our EPS RSU targ ets. TSR RSUs represent the right to receive from zero to 1.5 shares (2.0 shares for awards granted during or after 2014) of Sempra Energy common stock if performance targets are met. EPS RSUs represent the right to receive from zero to 2.0 shares of Sempr a Energy common stock if performance targets are met. If performance falls between the targets specified for each performance metric, we calculate the payout using linear interpolation. Participants also receive additional shares for dividend equivalents o n shares subject to RSUs, which are deemed reinvested to purchase additional units that become subject to the same vesting conditions as the RSUs to which the dividends relate. Our RSAs , which are solely service-based, and those RSUs that are service-based or issued in connection with certain other performance goals represent the right to receive up to 1.0 share if the service requirements or certain other vesting conditions are met. These RSAs and RSUs have the same dividend equivalent rights as the performance-based RSUs described above . We include RSAs and these RSUs in potential dilutive shares at 100 percent , subject to the application of the treasury stock method. We includ e our TSR RSUs and EPS RSUs in potential dilutive shares at zero to up to 200 percent to the extent that they currently meet the performance requirements for vesting, subject to the application of the treasury stock method. |
Interim period effective tax rate policy | 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., resolution of prior years’ income tax items, remeasurement of deferred tax asset valuation allowances, Mexi can currency translation and inflation adjustments, deferred income tax benefit s associated with impairment of a book investment 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 . |
Flow-through rate-making treatment tax policy | The 2016 GRC FD requires the establishment of a two-way income tax expense memorandum account for SDG&E and SoCalGas to track any revenue variances resulting from differences between the income tax expense forecasted in the GRC and the income tax expense incurred from 2016 through 2018. The variances to be tracked include tax expense differences relating to net revenue changes, mandatory tax law, tax accounting, tax procedural , or tax policy changes, and elective tax law, tax accounting, tax procedural, or tax policy changes. The account will remain open, and the balance in the account will be reviewed in subsequent GRC proceedings, until the CPUC decides to close the account. We believe the future dispos ition of these tracked balances may result in refunds being directed to ratepayers to the extent tax expense incurred is lower than forecasted tax expense as a result of certain flow-through item deductions (see description below) exceeding the amounts for ecasted in the GRC process. Although the 2016 GRC FD requires the tracking described above for SDG&E and SoCalGas , the Californ ia Public Utilities Commission (CPUC) continues to require 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 flow-through temporary differences , deferred income tax assets and liabilities are not recorded to deferred income tax expense, but rather to a regul atory 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 expenditur es 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 Differences arising from the forecasted amounts for these flow-through items will be tracked in the two-way income tax expense tracking account described above, except for the equity portion of AFUDC, which is not subject to taxation. We expect that amounts recorded in the tracking account may give rise to regulatory liabilities until the CPUC disposes with the account. The AFUDC rela ted to equity recorded for regulated construction projects at Sempra Mexico is also subject to flow-through treatment. |
Fair Value Measurement Policy | 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 affec t the valuation of fair value assets and liabilities, and their placement within the fair value hierarchy levels. The fair value of commodity derivative assets and liabilities is presented in accordance with our netting policy, as we discuss in Note 7 un der “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 June 30, 2016 and December 31, 2015 in the tables below include the following: Nuclear decomm issioning trusts reflect the assets of SDG&E’s nuclear decommissioning trusts, excluding cash balances. A third party trustee values the trust assets using prices from a pricing service based on a market approach. We validate these prices by comparison to prices from other independent data sources. Equity and certain debt securities are valued using quoted prices listed on nationally recognized securities exchanges or based on closing prices reported in the active market in which the identical security is t raded (Level 1). Other debt securities are valued based on yields that are currently available for comparable securities of issuers with similar credit ratings (Level 2). 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 obser vable, 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 rela te to CRRs a nd long-term, fixed-price electricity positions at SDG&E, as we discuss below under “Level 3 Information.” Rabbi Trust investments include marketable securities that we value using a market approach based on closing prices reported in the acti ve market in which the identical security is traded (Level 1). These investments in marketable securities were negligible at both June 30, 2016 and December 31, 2015. 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 throug h 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 (CAISO), an objective source. Annual auction prices are published once a year, typically in the middle of November, and remain in effect for the following year. The impact associated with discounting is negligible. Because auction prices are a less observa ble input, these instruments are classified as Level 3. The fair value of these instruments is derived from auction price differences between two locations. From January 1, 2016 to December 31, 2016, the auction prices range from $(24) per MWh to $10 per M Wh at a given location, and from January 1, 2015 to December 31, 2015, the auction prices ranged from $(16) per MWh to $8 per MWh at a given location. Positive values between two locations represent expected future reductions in congestion costs, whereas n egative 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 (lowe r) 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. At June 30, 2016, these electricity forward prices range from $21.55 per MWh to $62.71 per MWh. 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 p osition 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 also do not affect earnings. Fair Value of Financial Instruments The fair values of certain of our financial instruments (cash, temporary investments, accounts and notes receivable, current 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 Deferre d Compensation Plans are carried at cash surrender values, which represent the amount of cash that could be realized under the contracts. We determine the fair value of certain noncurrent amounts due from unconsolidated affiliates, long-term debt and preferred stock based on a market approach using quoted market prices for identical or similar securities in thinly-traded markets (Level 2). We value other noncurrent amounts due from unconsolidated affiliates of Sempra South American Utilities 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 c osts (Level 3). We value other long-term debt using an income approach based on the present value o f estimated future cash flows discounted at rates available for similar securities (Level 3). |
Derivatives Policy | 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 i n 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 reven ues, 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) u ndesignated. 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 offse t 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 Conde nsed Consolid ated 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 co mbination 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 inst rument 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 energy derivatives, both natural gas and electricity, 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 exchang e-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 a ctivities 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 Powe r 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 loss es 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 Natural Gas, 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 Conde nsed 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 Mex ican 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. Fro m 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. In addition to the amounts noted above, we frequently use commodity derivatives to manage risks associated with the phy sical locations of contractual obligation s 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. We periodically enter into interest rate derivative agreements intended to moderate our exposure to interest rates and to lower our overall costs of borrowing. We 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. Interest rate derivatives are utilized by the California Utilities as well as by other Sempra Energy subsidiaries and joint ventures. Int erest rate derivatives are generally accounted for as hedges, and although the California Utilities generally recover borrowing costs in rates over time, the use of interest rate derivatives is subject to certain regulatory constraints, and the impact of i nterest rate derivatives may not be recovered from customers as timely as described above with regard to energy derivatives. Separately, Otay Mesa VIE has entered into interest rate swap agreements, designated as cash flow hedges, to moderate its exposure to interest rate changes. 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. We are also exposed to exchange rate movements at our Mexican subsidiaries and joint ventures, which have U.S. dollar denominated cash balances, receivab les, 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 tr anslated 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 derivativ es as a means to manage the risk of exposure to significant fluctuations in our income tax expense and equity earnings from these impacts. In January 2016, we entered into foreign currency derivatives with a notional amount totaling $550 million. |
Legal Costs Policy | 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. |
Segment Policy | 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 intercompan y loans. The loan balances and related interest are eliminated in consolidation. |
RECENT INVESTMENT ACTIVITY (Tab
RECENT INVESTMENT ACTIVITY (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Investments [Abstract] | |
Assets Held for Sale Table | ASSETS HELD FOR SALE AT JUNE 30, 2016 (Dollars in millions) Termoeléctrica de Mexicali EnergySouth Inc. Cash and cash equivalents $ 1 $ 1 Inventories 8 3 Other current assets 21 13 Regulatory assets ― 12 Goodwill ― 72 Other assets 17 53 Property, plant and equipment, net 250 203 Total assets held for sale $ 297 $ 357 Accounts payable $ 1 $ 9 Other current liabilities 6 12 Long-term debt ― 67 Deferred income taxes 13 38 Regulatory liabilities ― 22 Asset retirement obligations 4 12 Other liabilities 19 19 Total liabilities held for sale $ 43 $ 179 |
OTHER FINANCIAL DATA (Tables)
OTHER FINANCIAL DATA (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure Text Block [Abstract] | |
Net Periodic Benefit Cost Table | NET PERIODIC BENEFIT COST – SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Pension benefits Other postretirement benefits Three months ended June 30, 2016 2015 2016 2015 Service cost $ 27 $ 29 $ 6 $ 7 Interest cost 40 39 11 11 Expected return on assets (41) (44) (18) (17) Amortization of: Prior service cost 3 2 ― ― Actuarial loss 7 11 ― ― Regulatory adjustment (28) (30) 2 ― Total net periodic benefit cost $ 8 $ 7 $ 1 $ 1 Six months ended June 30, 2016 2015 2016 2015 Service cost $ 55 $ 59 $ 11 $ 14 Interest cost 80 78 22 23 Expected return on assets (83) (88) (35) (34) Amortization of: Prior service cost (credit) 6 5 ― (1) Actuarial loss 13 19 ― ― Regulatory adjustment (56) (59) 4 ― Total net periodic benefit cost $ 15 $ 14 $ 2 $ 2 NET PERIODIC BENEFIT COST – SDG&E (Dollars in millions) Pension benefits Other postretirement benefits Three months ended June 30, 2016 2015 2016 2015 Service cost $ 8 $ 8 $ 1 $ 2 Interest cost 11 10 2 2 Expected return on assets (13) (13) (2) (3) Amortization of: Prior service cost 1 1 1 1 Actuarial loss (gain) 2 2 (1) ― Regulatory adjustment (8) (7) (1) (2) Total net periodic benefit cost $ 1 $ 1 $ ― $ ― Six months ended June 30, 2016 2015 2016 2015 Service cost $ 15 $ 16 $ 2 $ 4 Interest cost 21 20 4 4 Expected return on assets (25) (27) (5) (6) Amortization of: Prior service cost 1 1 2 2 Actuarial loss (gain) 5 4 (1) ― Regulatory adjustment (15) (12) (2) (4) Total net periodic benefit cost $ 2 $ 2 $ ― $ ― NET PERIODIC BENEFIT COST – SOCALGAS (Dollars in millions) Pension benefits Other postretirement benefits Three months ended June 30, 2016 2015 2016 2015 Service cost $ 18 $ 19 $ 3 $ 5 Interest cost 25 24 9 9 Expected return on assets (27) (27) (14) (14) Amortization of: Prior service cost (credit) 2 2 (1) (2) Actuarial loss 2 6 ― ― Regulatory adjustment (20) (23) 3 2 Total net periodic benefit cost $ ― $ 1 $ ― $ ― Six months ended June 30, 2016 2015 2016 2015 Service cost $ 35 $ 38 $ 7 $ 10 Interest cost 50 49 17 18 Expected return on assets (52) (54) (28) (28) Amortization of: Prior service cost (credit) 4 4 (2) (4) Actuarial loss 5 11 ― ― Regulatory adjustment (41) (47) 6 4 Total net periodic benefit cost $ 1 $ 1 $ ― $ ― |
Contributions to Benefit Plans Table | BENEFIT PLAN CONTRIBUTIONS (Dollars in millions) Sempra Energy Consolidated SDG&E SoCalGas Contributions through June 30, 2016: Pension plans $ 23 $ 2 $ ― Other postretirement benefit plans 2 ― 1 Total expected contributions in 2016: Pension plans $ 123 $ 4 $ 77 Other postretirement benefit plans 6 2 1 |
Earnings Per Share Computations Table | EARNINGS PER SHARE COMPUTATIONS (Dollars in millions, except per share amounts; shares in thousands) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Numerator: Earnings/Income attributable to common shares $ 16 $ 295 $ 335 $ 732 Denominator: Weighted-average common shares outstanding for basic EPS(1) 250,096 248,108 249,915 247,916 Dilutive effect of stock options, restricted stock awards and restricted stock units 1,842 3,383 1,771 3,348 Weighted-average common shares outstanding for diluted EPS 251,938 251,491 251,686 251,264 Earnings per share: Basic $ 0.06 $ 1.19 $ 1.34 $ 2.95 Diluted 0.06 1.17 1.33 2.91 (1) Includes 568 and 501 average fully vested restricted stock units held in our Deferred Compensation Plan for the three months ended June 30, 2016 and 2015, respectively, and 562 and 476 of such units for the six months ended June 30, 2016 and 2015, respectively. These fully vested restricted stock units are included in weighted-average common shares outstanding for basic EPS because there are no conditions under which the corresponding shares will not be issued. |
Capitalized Financing Costs Table | CAPITALIZED FINANCING COSTS (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Sempra Energy Consolidated: AFUDC related to debt $ 8 $ 7 $ 15 $ 13 AFUDC related to equity 30 31 57 58 Other capitalized interest 20 17 38 34 Total Sempra Energy Consolidated $ 58 $ 55 $ 110 $ 105 SDG&E: AFUDC related to debt $ 4 $ 4 $ 8 $ 7 AFUDC related to equity 13 10 24 18 Total SDG&E $ 17 $ 14 $ 32 $ 25 SoCalGas: AFUDC related to debt $ 4 $ 3 $ 7 $ 6 AFUDC related to equity 10 10 20 19 Total SoCalGas $ 14 $ 13 $ 27 $ 25 |
Changes in Components of Accumulated Comprehensive Income Table | CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1) SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Foreign Total currency Pension and other accumulated other translation Financial postretirement comprehensive adjustments instruments benefits income (loss) Three months ended June 30, 2016 and 2015 2016: Balance as of March 31, 2016 $ (514) $ (221) $ (86) $ (821) Other comprehensive income (loss) before reclassifications 11 (48) ― (37) Amounts reclassified from accumulated other comprehensive income ― 5 1 6 Net other comprehensive income (loss) 11 (43) 1 (31) Balance as of June 30, 2016 $ (503) $ (264) $ (85) $ (852) 2015: Balance as of March 31, 2015 $ (384) $ (145) $ (84) $ (613) Other comprehensive (loss) income before reclassifications (43) 57 ― 14 Amounts reclassified from accumulated other comprehensive income ― 2 1 3 Net other comprehensive (loss) income (43) 59 1 17 Balance as of June 30, 2015 $ (427) $ (86) $ (83) $ (596) Six months ended June 30, 2016 and 2015 2016: Balance as of December 31, 2015 $ (582) $ (137) $ (87) $ (806) Other comprehensive income (loss) before reclassifications 79 (130) ― (51) Amounts reclassified from accumulated other comprehensive income ― 3 2 5 Net other comprehensive income (loss) 79 (127) 2 (46) Balance as of June 30, 2016 $ (503) $ (264) $ (85) $ (852) 2015: . Balance as of December 31, 2014 $ (322) $ (90) $ (85) $ (497) Other comprehensive (loss) income before reclassifications (105) 3 ― (102) Amounts reclassified from accumulated other comprehensive income ― 1 2 3 Net other comprehensive (loss) income (105) 4 2 (99) Balance as of June 30, 2015 $ (427) $ (86) $ (83) $ (596) (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) Amounts reclassified Details about accumulated from accumulated other Affected line item on Condensed other comprehensive income (loss) components comprehensive income (loss) Consolidated Statements of Operations Three months ended June 30, 2016 2015 Sempra Energy Consolidated: Financial instruments: Interest rate and foreign exchange instruments $ 3 $ 3 Interest Expense Interest rate instruments 2 3 Equity Earnings (Losses), Before Income Tax Interest rate and foreign exchange instruments 5 ― Equity Earnings, Net of Income Tax Total before income tax 10 6 (1) (1) Income Tax Expense Net of income tax 9 5 (4) (3) Earnings Attributable to Noncontrolling Interests $ 5 $ 2 Pension and other postretirement benefits: Amortization of actuarial loss $ 2 $ 2 See note (1) below (1) (1) Income Tax Expense Net of income tax $ 1 $ 1 Total reclassifications for the period, net of tax $ 6 $ 3 SDG&E: Financial instruments: Interest rate instruments $ 3 $ 3 Interest Expense (3) (3) Losses (Earnings) Attributable to Noncontrolling Interest Total reclassifications for the period, net of tax $ ― $ ― (1) Amounts are included in the computation of net periodic benefit cost (see "Pension and Other Postretirement Benefits" above). RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (Dollars in millions) Amount reclassified Details about accumulated from accumulated other Affected line item on Condensed other comprehensive income (loss) components comprehensive income (loss) Consolidated Statements of Operations Six months ended June 30, 2016 2015 Sempra Energy Consolidated: Financial instruments: Interest rate and foreign exchange instruments $ 7 $ 9 Interest Expense Interest rate instruments 5 6 Equity Earnings (Losses), Before Income Tax Interest rate and foreign exchange instruments 6 ― Equity Earnings, Net of Income Tax Commodity contracts not subject to rate recovery (7) (7) Revenues: Energy-Related Businesses Total before income tax 11 8 (1) ― Income Tax Expense Net of income tax 10 8 (7) (7) Earnings Attributable to Noncontrolling Interests $ 3 $ 1 Pension and other postretirement benefits: Amortization of actuarial loss $ 4 $ 4 See note (1) below (2) (2) Income Tax Expense Net of income tax $ 2 $ 2 Total reclassifications for the period, net of tax $ 5 $ 3 SDG&E: Financial instruments: Interest rate instruments $ 6 $ 6 Interest Expense (6) (6) Losses (Earnings) Attributable to Noncontrolling Interest Total reclassifications for the period, net of tax $ ― $ ― (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 Non- shareholders’ controlling Total equity interests(1) equity Balance at December 31, 2015 $ 11,809 $ 770 $ 12,579 Comprehensive income 290 22 312 Preferred dividends of subsidiary (1) ― (1) Share-based compensation expense 24 ― 24 Common stock dividends declared (377) ― (377) Issuances of common stock 56 ― 56 Repurchases of common stock (54) ― (54) Tax benefit related to share-based compensation 34 ― 34 Equity contributed by noncontrolling interest ― 1 1 Distributions to noncontrolling interests ― (11) (11) Balance at June 30, 2016 $ 11,781 $ 782 $ 12,563 Balance at December 31, 2014 $ 11,326 $ 774 $ 12,100 Comprehensive income 634 33 667 Preferred dividends of subsidiary (1) ― (1) Share-based compensation expense 26 ― 26 Common stock dividends declared (347) ― (347) Issuances of common stock 59 ― 59 Repurchases of common stock (66) ― (66) Tax benefit related to share-based compensation 52 ― 52 Equity contributed by noncontrolling interest ― 1 1 Distributions to noncontrolling interests ― (16) (16) Balance at June 30, 2015 $ 11,683 $ 792 $ 12,475 (1) Noncontrolling interests include the preferred stock of SoCalGas and other noncontrolling interests as listed in the table below under "Other Noncontrolling Interests." SHAREHOLDER'S EQUITY AND NONCONTROLLING INTEREST – SDG&E (Dollars in millions) SDG&E Non- shareholder’s controlling Total equity interest equity Balance at December 31, 2015 $ 5,223 $ 53 $ 5,276 Comprehensive income (loss) 229 (13) 216 Common stock dividends declared (175) ― (175) Distributions to noncontrolling interest ― (3) (3) Balance at June 30, 2016 $ 5,277 $ 37 $ 5,314 Balance at December 31, 2014 $ 4,932 $ 60 $ 4,992 Comprehensive income 273 9 282 Distributions to noncontrolling interest ― (8) (8) Balance at June 30, 2015 $ 5,205 $ 61 $ 5,266 SHAREHOLDERS' EQUITY ― SOCALGAS (Dollars in millions) SoCalGas shareholders' equity Balance at December 31, 2015 $ 3,149 Comprehensive income 195 Preferred stock dividends declared (1) Balance at June 30, 2016 $ 3,343 Balance at December 31, 2014 $ 2,781 Comprehensive income 285 Preferred stock dividends declared (1) Balance at June 30, 2015 $ 3,065 |
Amounts Due To and From Affiliates at SDG&E and SoCalGas Table | AMOUNTS DUE FROM (TO) UNCONSOLIDATED AFFILIATES (Dollars in millions) June 30, 2016 December 31, 2015 Sempra Energy Consolidated: Total due from various unconsolidated affiliates - current $ 6 $ 6 Sempra South American Utilities(1): Eletrans S.A. and Eletrans II S.A.: 4% Note(2) $ 79 $ 72 Other related party receivables 2 ― Sempra Mexico(1): Affiliate of joint venture with PEMEX: Note due November 13, 2017(3) 2 3 Note due November 14, 2018(3) 43 42 Note due November 14, 2018(3) 35 34 Note due November 14, 2018(3) 8 8 Energía Sierra Juárez: Note due June 15, 2018(4) 17 24 Sempra Natural Gas: Cameron LNG JV 6 3 Total due from unconsolidated affiliates - noncurrent $ 192 $ 186 Total due to various unconsolidated affiliates - current $ (8) $ (14) SDG&E: Sempra Energy(5) $ 163 $ ― Other affiliates ― 1 Total due from unconsolidated affiliates - current $ 163 $ 1 Sempra Energy $ ― $ (34) SoCalGas (7) (13) Other affiliates (183) (8) Total due to unconsolidated affiliates - current $ (190) $ (55) Income taxes due from Sempra Energy(6) $ 59 $ 28 SoCalGas: Sempra Energy(7) $ ― $ 35 SDG&E 7 13 Total due from unconsolidated affiliates - current $ 7 $ 48 Sempra Energy $ (25) $ ― Total due to unconsolidated affiliate - current $ (25) $ ― Income taxes due from Sempra Energy(6) $ 9 $ 1 (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., both of which are joint ventures at Chilquinta Energía. (3) U.S. dollar-denominated loan, at a variable interest rate based on a 30-day LIBOR plus 450 basis points (4.97 percent at June 30, 2016), to finance the Los Ramones Norte pipeline project. (4) U.S. dollar-denominated loan, at a variable interest rate based on a 30-day LIBOR plus 637.5 basis points (6.84 percent at June 30, 2016), to finance the first phase of the Energía Sierra Juárez wind project, which is a joint venture of IEnova. (5) At June 30, 2016, net receivable included outstanding advances to Sempra Energy of $172 million at an interest rate of 0.35 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 December 31, 2015, net receivable included outstanding advances to Sempra Energy of $50 million at an interest rate of 0.11 percent. |
Revenues From Unconsolidated Affiliates at SDG&E and SoCalGas Table | REVENUES AND COST OF SALES FROM UNCONSOLIDATED AFFILIATES (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 REVENUES Sempra Energy Consolidated $ 5 $ 8 $ 10 $ 16 SDG&E ― 2 3 5 SoCalGas 18 17 35 36 COST OF SALES Sempra Energy Consolidated $ 20 $ 30 $ 50 $ 49 SDG&E 16 13 30 18 |
Other Income and Expense Table | OTHER INCOME, NET (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Sempra Energy Consolidated: Allowance for equity funds used during construction $ 30 $ 31 $ 57 $ 58 Investment gains (losses)(1) 10 (2) 20 7 Losses on interest rate and foreign exchange instruments, net (15) (3) (12) (3) Foreign currency transaction losses (5) (2) (7) (3) Sale of other investments 1 6 2 6 Electrical infrastructure relocation income(2) 2 4 3 4 Regulatory interest, net(3) 1 1 3 2 Sundry, net (1) 2 6 5 Total $ 23 $ 37 $ 72 $ 76 SDG&E: Allowance for equity funds used during construction $ 13 $ 10 $ 24 $ 18 Regulatory interest, net(3) 1 1 3 2 Sundry, net (1) (2) ― (2) Total $ 13 $ 9 $ 27 $ 18 SoCalGas: Allowance for equity funds used during construction $ 10 $ 10 $ 20 $ 19 Sundry, net (4) (1) (4) (2) Total $ 6 $ 9 $ 16 $ 17 (1) Represents investment gains (losses) on dedicated assets in support of our executive retirement and deferred compensation plans. These amounts are partially offset by corresponding changes in compensation expense related to the plans. (2) Income at Luz del Sur associated with the relocation of electrical infrastructure. (3) Interest on regulatory balancing accounts. |
Income Tax Expense and Effective Income Tax Rates Table | INCOME TAX EXPENSE AND EFFECTIVE INCOME TAX RATES (Dollars in millions) Income tax Effective Effective (benefit) income Income tax income expense tax rate expense tax rate Three months ended June 30, 2016 2015 Sempra Energy Consolidated $ (106) 95 % $ 98 25 % SDG&E 48 36 54 29 SoCalGas (29) 100 16 18 Six months ended June 30, 2016 2015 Sempra Energy Consolidated $ 36 10 % $ 261 26 % SDG&E 120 36 142 34 SoCalGas 58 23 111 28 |
Variable Interest Entity Table | AMOUNTS ASSOCIATED WITH OTAY MESA VIE (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Operating expenses Cost of electric fuel and purchased power $ (17) $ (21) $ (34) $ (39) Operation and maintenance 15 6 19 10 Depreciation and amortization 10 6 17 12 Total operating expenses 8 (9) 2 (17) Operating (loss) income (8) 9 (2) 17 Interest expense (5) (5) (10) (9) (Loss) income before income taxes/Net (loss) income (13) 4 (12) 8 Losses (earnings) attributable to noncontrolling interest 13 (4) 12 (8) Earnings attributable to common shares $ ― $ ― $ ― $ ― |
Ownership Interests Held By Others Table | OTHER NONCONTROLLING INTERESTS (Dollars in millions) Percent ownership held by others June 30, December 31, June 30, December 31, 2016 2015 2016 2015 SDG&E: Otay Mesa VIE 100 % 100 % $ 37 $ 53 Sempra South American Utilities: Chilquinta Energía subsidiaries(1) 23.2 – 43.4 23.5 – 43.4 21 21 Luz del Sur 16.4 16.4 175 164 Tecsur 9.8 9.8 4 4 Sempra Mexico: IEnova 18.9 18.9 484 468 Sempra Natural Gas: Bay Gas Storage Company, Ltd. 9.1 9.1 26 25 Liberty Gas Storage, LLC 23.3 23.2 14 14 Southern Gas Transmission Company 49.0 49.0 1 1 Total Sempra Energy $ 762 $ 750 (1) Chilquinta Energía has four subsidiaries with noncontrolling interests held by others. Percentage range reflects the highest and lowest ownership percentages among these subsidiaries. |
Inventory Table | INVENTORY BALANCES (Dollars in millions) Natural gas Liquefied natural gas Materials and supplies Total June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 June 30, 2016 December 31, 2015 SDG&E $ 1 $ 6 $ ― $ ― $ 70 $ 69 $ 71 $ 75 SoCalGas(1) ― 49 ― ― 44 30 44 79 Sempra South American Utilities ― ― ― ― 43 30 43 30 Sempra Mexico ― ― 7 3 2 10 9 13 Sempra Renewables ― ― ― ― 3 3 3 3 Sempra Natural Gas 96 94 4 3 ― 1 100 98 Sempra Energy Consolidated $ 97 $ 149 $ 11 $ 6 $ 162 $ 143 $ 270 $ 298 (1) At both June 30, 2016 and December 31, 2015, 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. |
DERIVATIVE FINANCIAL INSTRUME21
DERIVATIVE FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Derivative Instruments And Hedging Activities Disclosure [Abstract] | |
Commodity Derivative Volumes Table | NET ENERGY DERIVATIVE VOLUMES (Quantities in millions) June 30, December 31, Segment and Commodity Unit of measure 2016 2015 California Utilities: SDG&E: Natural gas MMBtu(1) 72 70 Electricity MWh(2) 1 1 Congestion revenue rights MWh 30 36 SoCalGas – natural gas MMBtu ― 1 Energy-Related Businesses: Sempra Natural Gas – natural gas MMBtu 30 43 (1) Million British thermal units (2) Megawatt hours |
Notional Amounts of Interest Rate Derivatives Table | INTEREST RATE DERIVATIVES (Dollars in millions) June 30, 2016 December 31, 2015 Notional debt Maturities Notional debt Maturities Sempra Energy Consolidated: Cash flow hedges(1) $ 377 2016-2028 $ 384 2016-2028 Fair value hedges ― ― 300 2016 SDG&E: Cash flow hedge(1) 310 2016-2019 315 2016-2019 (1) Includes Otay Mesa VIE. All of SDG&E’s interest rate derivatives relate to Otay Mesa VIE. FOREIGN CURRENCY DERIVATIVES (Dollars in millions) June 30, 2016 December 31, 2015 Notional debt Maturities Notional debt Maturities Sempra Mexico: Cross-currency swaps $ 408 2018-2023 $ 408 2018-2023 Other foreign currency derivatives 550 2016 ― ― |
Derivative Instruments on the Condensed Consolidated Balance Sheets Table | DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS (Dollars in millions) June 30, 2016 Deferred credits Current Current and other assets: liabilities: liabilities: Fixed-price Fixed-price Fixed-price contracts Other contracts contracts and other assets: and other and other derivatives(1) Sundry derivatives(2) derivatives Sempra Energy Consolidated: Derivatives designated as hedging instruments: Interest rate and foreign exchange instruments(3) $ 1 $ ― $ (15) $ (184) Commodity contracts not subject to rate recovery ― ― (5) ― Derivatives not designated as hedging instruments: Interest rate and foreign exchange instruments ― ― (12) ― Commodity contracts not subject to rate recovery 208 22 (227) (17) Associated offsetting commodity contracts (199) (13) 199 13 Associated offsetting cash collateral ― ― 30 1 Commodity contracts subject to rate recovery 18 52 (35) (48) Associated offsetting commodity contracts (4) (2) 4 2 Associated offsetting cash collateral ― ― 13 15 Net amounts presented on the balance sheet 24 59 (48) (218) Additional cash collateral for commodity contracts not subject to rate recovery 14 ― ― ― Additional cash collateral for commodity contracts subject to rate recovery 27 ― ― ― Total(4) $ 65 $ 59 $ (48) $ (218) SDG&E: Derivatives designated as hedging instruments: Interest rate instruments(3) $ ― $ ― $ (14) $ (23) Derivatives not designated as hedging instruments: Commodity contracts subject to rate recovery 16 52 (32) (48) Associated offsetting commodity contracts (3) (2) 3 2 Associated offsetting cash collateral ― ― 12 15 Net amounts presented on the balance sheet 13 50 (31) (54) Additional cash collateral for commodity contracts subject to rate recovery 26 ― ― ― Total(4) $ 39 $ 50 $ (31) $ (54) SoCalGas: Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery $ ― $ ― $ (1) $ ― Associated offsetting cash collateral ― ― 1 ― Commodity contracts subject to rate recovery 2 ― (3) ― Associated offsetting commodity contracts (1) ― 1 ― Associated offsetting cash collateral ― ― 1 ― 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 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, 2015 Deferred credits Current Current and other assets: liabilities: liabilities: Fixed-price Fixed-price Fixed-price contracts Other contracts contracts and other assets: and other and other derivatives(1) Sundry derivatives(2) derivatives Sempra Energy Consolidated: Derivatives designated as hedging instruments: Interest rate and foreign exchange instruments(3) $ 4 $ 1 $ (15) $ (156) Commodity contracts not subject to rate recovery 13 ― ― ― Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery 245 32 (239) (21) Associated offsetting commodity contracts (232) (20) 232 20 Associated offsetting cash collateral (6) ― 4 ― Commodity contracts subject to rate recovery 28 49 (61) (64) Associated offsetting commodity contracts (2) (2) 2 2 Associated offsetting cash collateral ― ― 28 26 Net amounts presented on the balance sheet 50 60 (49) (193) Additional cash collateral for commodity contracts not subject to rate recovery 2 ― ― ― Additional cash collateral for commodity contracts subject to rate recovery 28 ― ― ― Total(4) $ 80 $ 60 $ (49) $ (193) SDG&E: Derivatives designated as hedging instruments: Interest rate instruments(3) $ ― $ ― $ (14) $ (23) Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery ― ― (1) ― Associated offsetting cash collateral ― ― 1 ― Commodity contracts subject to rate recovery 27 49 (60) (64) Associated offsetting commodity contracts (2) (2) 2 2 Associated offsetting cash collateral ― ― 28 26 Net amounts presented on the balance sheet 25 47 (44) (59) Additional cash collateral for commodity contracts not subject to rate recovery 1 ― ― ― Additional cash collateral for commodity contracts subject to rate recovery 27 ― ― ― Total(4) $ 53 $ 47 $ (44) $ (59) SoCalGas: Derivatives not designated as hedging instruments: Commodity contracts not subject to rate recovery $ ― $ ― $ (1) $ ― Associated offsetting cash collateral ― ― 1 ― Commodity contracts subject to rate recovery 1 ― (1) ― Net amounts presented on the balance sheet 1 ― (1) ― Additional cash collateral for commodity contracts subject to rate recovery 1 ― ― ― Total $ 2 $ ― $ (1) $ ― (1) Included in Current Assets: Other for SoCalGas. (2) Included in Current Liabilities: Other for SoCalGas. (3) Includes Otay Mesa VIE. All of SDG&E’s amounts relate to Otay Mesa VIE. (4) Normal purchase contracts previously measured at fair value are excluded. |
Fair Value Hedge Impact on the Condensed Consolidated Statements of Operations Table | FAIR VALUE HEDGE IMPACTS (Dollars in millions) Pretax gain (loss) on derivatives recognized in earnings Three months ended June 30, Six months ended June 30, Location 2016 2015 2016 2015 Sempra Energy Consolidated: Interest rate instruments Interest Expense $ 1 $ 2 $ 3 $ 4 Interest rate instruments Other Income, Net (2) (3) (2) (2) Total(1) $ (1) $ (1) $ 1 $ 2 (1) There was no hedge ineffectiveness in either the three months or six months ended June 30, 2016 or 2015. All other changes in the fair value of the interest rate swap agreements are exactly offset by changes in the fair value of the underlying long-term debt and are recorded in Other Income, Net. |
Cash Flow Hedge Impact on the Condensed Consolidated Statements of Operations Table | CASH FLOW HEDGE IMPACTS (Dollars in millions) Pretax gain (loss) Pretax (loss) gain reclassified recognized in OCI from AOCI into earnings (effective portion) (effective portion) Three months ended June 30, Three months ended June 30, 2016 2015 Location 2016 2015 Sempra Energy Consolidated: Interest rate and foreign exchange instruments(1) $ 1 $ 6 Interest Expense $ (3) $ (3) Equity Earnings (Losses), Interest rate instruments (70) 89 Before Income Tax (2) (3) Interest rate and foreign Equity Earnings, exchange instruments (15) ― Net of Income Tax (5) ― Commodity contracts not subject Revenues: Energy-Related to rate recovery (5) 1 Businesses ― ― Total(2) $ (89) $ 96 $ (10) $ (6) SDG&E: Interest rate instruments(1)(2) $ (2) $ ― Interest Expense $ (3) $ (3) Six months ended June 30, Six months ended June 30, 2016 2015 Location 2016 2015 Sempra Energy Consolidated: Interest rate and foreign exchange instruments(1) $ (10) $ (12) Interest Expense $ (7) $ (9) Equity Earnings (Losses), Interest rate instruments (207) 11 Before Income Tax (5) (6) Interest rate and foreign Equity Earnings, exchange instruments (33) ― Net of Income Tax (6) ― Commodity contracts not subject Revenues: Energy-Related to rate recovery (4) ― Businesses 7 7 Total(2) $ (254) $ (1) $ (11) $ (8) SDG&E: Interest rate instruments(1)(2) $ (7) $ (5) Interest Expense $ (6) $ (6) (1) Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE. (2) Amounts include negligible hedge ineffectiveness in the three months and six months ended June 30, 2016 and 2015. |
Undesignated Derivative Impact on the Condensed Consolidated Statements of Operations Table | UNDESIGNATED DERIVATIVE IMPACTS (Dollars in millions) Pretax (loss) gain on derivatives recognized in earnings Three months ended June 30, Six months ended June 30, Location 2016 2015 2016 2015 Sempra Energy Consolidated: Foreign exchange instruments Other Income, Net $ (15) $ (3) $ (12) $ (3) Foreign exchange instruments Equity Earnings, Net of Income Tax ― ― 2 (1) Commodity contracts not subject Revenues: Energy-Related to rate recovery Businesses (24) 9 (29) 12 Commodity contracts not subject to rate recovery Operation and Maintenance 1 1 1 1 Commodity contracts subject Cost of Electric Fuel to rate recovery and Purchased Power 40 (53) 28 (73) Commodity contracts subject to rate recovery Cost of Natural Gas (1) ― (2) 1 Total $ 1 $ (46) $ (12) $ (63) SDG&E: Commodity contracts subject Cost of Electric Fuel to rate recovery and Purchased Power $ 40 $ (53) $ 28 $ (73) SoCalGas: Commodity contracts not subject to rate recovery Operation and Maintenance $ ― $ 1 $ ― $ 1 Commodity contracts subject to rate recovery Cost of Natural Gas (1) ― (2) 1 Total $ (1) $ 1 $ (2) $ 2 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Recurring Fair Value Measures Table | RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Fair value at June 30, 2016 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 632 $ ― $ ― $ ― $ 632 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 52 52 ― ― 104 Municipal bonds ― 163 ― ― 163 Other securities ― 192 ― ― 192 Total debt securities 52 407 ― ― 459 Total nuclear decommissioning trusts(2) 684 407 ― ― 1,091 Interest rate and foreign exchange instruments ― 1 ― ― 1 Commodity contracts not subject to rate recovery 1 17 ― 14 32 Commodity contracts subject to rate recovery ― 1 63 27 91 Total $ 685 $ 426 $ 63 $ 41 $ 1,215 Liabilities: Interest rate and foreign exchange instruments $ ― $ 211 $ ― $ ― $ 211 Commodity contracts not subject to rate recovery 32 5 ― (31) 6 Commodity contracts subject to rate recovery 1 37 39 (28) 49 Total $ 33 $ 253 $ 39 $ (59) $ 266 Fair value at December 31, 2015 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 619 $ ― $ ― $ ― $ 619 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 47 44 ― ― 91 Municipal bonds ― 156 ― ― 156 Other securities ― 182 ― ― 182 Total debt securities 47 382 ― ― 429 Total nuclear decommissioning trusts(2) 666 382 ― ― 1,048 Interest rate and foreign exchange instruments ― 5 ― ― 5 Commodity contracts not subject to rate recovery 22 16 ― (4) 34 Commodity contracts subject to rate recovery ― 1 72 28 101 Total $ 688 $ 404 $ 72 $ 24 $ 1,188 Liabilities: Interest rate and foreign exchange instruments $ ― $ 171 $ ― $ ― $ 171 Commodity contracts not subject to rate recovery 5 3 ― (4) 4 Commodity contracts subject to rate recovery ― 68 53 (54) 67 Total $ 5 $ 242 $ 53 $ (58) $ 242 (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 June 30, 2016 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 632 $ ― $ ― $ ― $ 632 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 52 52 ― ― 104 Municipal bonds ― 163 ― ― 163 Other securities ― 192 ― ― 192 Total debt securities 52 407 ― ― 459 Total nuclear decommissioning trusts(2) 684 407 ― ― 1,091 Commodity contracts subject to rate recovery ― ― 63 26 89 Total $ 684 $ 407 $ 63 $ 26 $ 1,180 Liabilities: Interest rate instruments $ ― $ 37 $ ― $ ― $ 37 Commodity contracts subject to rate recovery ― 36 39 (27) 48 Total $ ― $ 73 $ 39 $ (27) $ 85 Fair value at December 31, 2015 Level 1 Level 2 Level 3 Netting(1) Total Assets: Nuclear decommissioning trusts: Equity securities $ 619 $ ― $ ― $ ― $ 619 Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies 47 44 ― ― 91 Municipal bonds ― 156 ― ― 156 Other securities ― 182 ― ― 182 Total debt securities 47 382 ― ― 429 Total nuclear decommissioning trusts(2) 666 382 ― ― 1,048 Commodity contracts not subject to rate recovery ― ― ― 1 1 Commodity contracts subject to rate recovery ― ― 72 27 99 Total $ 666 $ 382 $ 72 $ 28 $ 1,148 Liabilities: Interest rate instruments $ ― $ 37 $ ― $ ― $ 37 Commodity contracts not subject to rate recovery 1 ― ― (1) ― Commodity contracts subject to rate recovery ― 67 53 (54) 66 Total $ 1 $ 104 $ 53 $ (55) $ 103 (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 June 30, 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 ― 1 2 Total $ ― $ 1 $ ― $ 2 $ 3 Liabilities: Commodity contracts not subject to rate recovery $ 1 $ ― $ ― $ (1) $ ― Commodity contracts subject to rate recovery 1 1 ― (1) 1 Total $ 2 $ 1 $ ― $ (2) $ 1 Fair value at December 31, 2015 Level 1 Level 2 Level 3 Netting(1) Total Assets: Commodity contracts subject to rate recovery $ ― $ 1 $ ― $ 1 $ 2 Total $ ― $ 1 $ ― $ 1 $ 2 Liabilities: Commodity contracts not subject to rate recovery $ 1 $ ― $ ― $ (1) $ ― Commodity contracts subject to rate recovery ― 1 ― ― 1 Total $ 1 $ 1 $ ― $ (1) $ 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 June 30, 2016 2015 Balance as of April 1 $ 11 $ 102 Realized and unrealized gains (losses) 8 (60) Allocated transmission instruments ― 1 Settlements 5 (1) Balance as of June 30 $ 24 $ 42 Change in unrealized gains relating to instruments still held at June 30 $ 9 $ 45 Six months ended June 30, 2016 2015 Balance as of January 1 $ 19 $ 107 Realized and unrealized gains (losses) 7 (54) Allocated transmission instruments ― 1 Settlements (2) (12) Balance as of June 30 $ 24 $ 42 Change in unrealized gains relating to instruments still held at June 30 $ 9 $ 46 |
Fair Value of Financial Instruments Table | FAIR VALUE OF FINANCIAL INSTRUMENTS (Dollars in millions) June 30, 2016 Carrying Fair value amount Level 1 Level 2 Level 3 Total Sempra Energy Consolidated: Noncurrent due from unconsolidated affiliates (1) $ 179 $ ― $ 94 $ 77 $ 171 Total long-term debt (2)(3) 13,811 ― 14,933 572 15,505 Preferred stock of subsidiary 20 ― 25 ― 25 SDG&E: Total long-term debt (3)(4) $ 4,677 $ ― $ 5,055 $ 310 $ 5,365 SoCalGas: Total long-term debt (5) $ 3,009 $ ― $ 3,335 $ ― $ 3,335 Preferred stock 22 ― 27 ― 27 December 31, 2015 Carrying Fair value amount Level 1 Level 2 Level 3 Total Sempra Energy Consolidated: Noncurrent due from unconsolidated affiliates (1) $ 175 $ ― $ 97 $ 69 $ 166 Total long-term debt (2)(3) 13,761 ― 13,985 648 14,633 Preferred stock of subsidiary 20 ― 23 ― 23 SDG&E: Total long-term debt (3)(4) $ 4,304 $ ― $ 4,355 $ 315 $ 4,670 SoCalGas: Total long-term debt (5) $ 2,513 $ ― $ 2,621 $ ― $ 2,621 Preferred stock 22 ― 25 ― 25 (1) Excluding accumulated interest outstanding of $13 million and $11 million at June 30, 2016 and December 31, 2015, respectively. (2) Before reductions for unamortized discount (net of premium) and debt issuance costs of $111 million and $107 million at June 30, 2016 and December 31, 2015, respectively, and excluding build-to-suit and capital lease obligations of $385 million and $387 million at June 30, 2016 and December 31, 2015, 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 $310 million and $315 million at June 30, 2016 and December 31, 2015, respectively, related to Otay Mesa VIE. (4) Before reductions for unamortized discount and debt issuance costs of $47 million and $43 million at June 30, 2016 and December 31, 2015, respectively, and excluding capital lease obligations of $242 million and $244 million at June 30, 2016 and December 31, 2015, respectively. (5) Before reductions for unamortized discount and debt issuance costs of $28 million and $24 million at June 30, 2016 and December 31, 2015, respectively, and excluding capital lease obligations of $1 million both at June 30, 2016 and December 31, 2015. |
Fair Value Measurements, Nonrecurring Table | NON-RECURRING FAIR VALUE MEASURES – SEMPRA ENERGY CONSOLIDATED (Dollars in millions) Estimated Fair % of Inputs used to fair value fair value develop Range of value Valuation technique hierarchy measurement measurement inputs Investment in Rockies Express $ 440 (1) Market approach Level 2 100% Equity sale price 100% (1) At measurement date of March 29, 2016. |
NUCLEAR PLANT (Tables)
NUCLEAR PLANT (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Public Utilities General Disclosures [Abstract] | |
Schedule of Nuclear Decommissioning Trusts Investments | NUCLEAR DECOMMISSIONING TRUSTS (Dollars in millions) Gross Gross Estimated unrealized unrealized fair Cost gains losses value At June 30, 2016: Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies(1) $ 99 $ 5 $ ― $ 104 Municipal bonds(2) 150 13 ― 163 Other securities(2) 189 9 (6) 192 Total debt securities 438 27 (6) 459 Equity securities 221 416 (5) 632 Cash and cash equivalents 12 ― ― 12 Total $ 671 $ 443 $ (11) $ 1,103 At December 31, 2015: Debt securities: Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies $ 89 $ 2 $ ― $ 91 Municipal bonds 148 8 ― 156 Other securities 194 1 (13) 182 Total debt securities 431 11 (13) 429 Equity securities 214 412 (7) 619 Cash and cash equivalents 15 ― ― 15 Total $ 660 $ 423 $ (20) $ 1,063 (1) Maturity dates are 2017-2065. (2) Maturity dates are 2016-2115. |
Schedule of Sales of Securities By Nuclear Decommissioning Trusts | SALES OF SECURITIES (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 Proceeds from sales(1) $ 111 $ 127 $ 204 $ 221 Gross realized gains 5 4 8 6 Gross realized losses (3) (3) (11) (7) (1) Excludes securities that are held to maturity. |
CALIFORNIA UTILITIES' REGULAT24
CALIFORNIA UTILITIES' REGULATORY MATTERS (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Public Utilities General Disclosures [Abstract] | |
Schedule Of Regulatory Matters | EARNINGS IMPACTS FROM THE 2016 GRC FD RECORDED IN THE SECOND QUARTER OF 2016 (Dollars in millions) SoCalGas SDG&E Pretax After-tax Pretax After-tax earnings earnings earnings earnings (charge) (charge) (charge) (charge) Retroactive revenue requirement increase for the first quarter of 2016 $ 20 $ 12 $ 15 $ 9 Adjustments to revenue related to tax repairs deductions: Refund of 2015 memorandum account $ (72) $ (43) $ (37) $ (22) True-up of 2012-2014 estimates to actuals (11) (6) (15) (9) Total $ (83) $ (49) $ (52) $ (31) MAJOR PROJECTS – UPDATES Joint Utilities Projects Southern Gas System Reliability Project (North-South Pipeline) § In July 2016, the CPUC issued a final decision which denies the California Utilities' request for a permit to construct. § In June 2016, SoCalGas recorded an after-tax impairment charge of $13 million for the development costs it had invested in the project. The pretax charge of $21 million is included in Operation and Maintenance on Sempra Energy's and SoCalGas' Condensed Consolidated Statements of Operations. We expect to make a filing to the CPUC seeking recovery of all or a portion of these costs. Pipeline Safety & Reliability Project § SDG&E and SoCalGas filed an amended application with the CPUC in March 2016 providing detailed analysis and testimony supporting the proposed project. The revised request also presents additional information on the costs and benefits of project alternatives, safety evaluation and compliance analysis, and statutory and procedural requirements. SDG&E and SoCalGas seek approval to construct the proposed project, estimated at a cost of $633 million, and authority to recover the associated revenue requirement in rates. SDG&E Projects Cleveland National Forest (CNF) Transmission Projects § In March 2016, the U.S. Forest Service issued a final decision authorizing issuance of the CNF Master Special Use Permit renewing SDG&E's land rights and authorizing the construction, operation and maintenance of facilities located on national forest lands for the next 50 years, as well as approving the majority of the fire-hardening activities proposed by SDG&E. § In May 2016, the CPUC issued a final decision granting SDG&E a permit to construct. The project will be installed at an estimated cost of $680 million: $470 million for the various transmission-level facilities and $210 million for associated distribution-level facilities, including distribution circuits and additional undergrounding required by the final environmental impact statement. In July 2016, the Cleveland National Forest Foundation and the Protect Our Communities Foundation filed a joint application for rehearing of the final decision. Sycamore-Peñasquitos Transmission Project § March 2016 final environmental impact report (EIR) recommended an alternative that undergrounds more of the project than originally proposed, and is viewed as environmentally superior. The CPUC may consider this alternative. § The recommended alternative in the EIR has an estimated cost of $250 million to $300 million, compared to the original project cost estimate of $120 million to $150 million, and would also delay the project schedule by approximately 10 months. § CPUC decision expected in the second half of 2016. South Orange County Reliability Enhancement § CPUC issued its final EIR for the project in April 2016. The EIR concluded that an alternative project is considered environmentally superior to SDG&E's proposal. The final EIR states that the CPUC is not required to adopt the environmentally superior alternative if there are overriding considerations in favor of another alternative. The CPUC will consider the findings in determining whether to approve SDG&E's proposed project or an alternative to it. § Final CPUC decision expected in the second half of 2016. Energy Storage Projects § SDG&E filed an advice letter with the CPUC in July 2016 seeking approval to own and operate two energy storage projects totaling 37.5 MW. The purpose of the two projects is to enhance electric reliability in the San Diego service territory. § We expect a CPUC resolution later in 2016. |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Segment [Abstract] | |
Segment Information Table | SEGMENT INFORMATION (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 REVENUES SDG&E $ 992 46 % $ 972 41 % $ 1,983 41 % $ 1,938 38 % SoCalGas 617 29 780 33 1,650 35 1,828 36 Sempra South American Utilities 385 18 389 16 785 16 778 15 Sempra Mexico 147 7 152 6 285 6 315 6 Sempra Renewables 6 ― 10 1 13 ― 18 1 Sempra Natural Gas 90 4 155 7 220 5 352 7 Adjustments and eliminations ― ― (1) ― ― ― (1) ― Intersegment revenues(1) (81) (4) (90) (4) (158) (3) (179) (3) Total $ 2,156 100 % $ 2,367 100 % $ 4,778 100 % $ 5,049 100 % INTEREST EXPENSE SDG&E $ 48 $ 52 $ 96 $ 104 SoCalGas 24 19 46 38 Sempra South American Utilities 11 8 20 13 Sempra Mexico 4 6 8 11 Sempra Renewables ― 1 ― 2 Sempra Natural Gas 10 23 22 44 All other 74 65 146 128 Intercompany eliminations (29) (35) (53) (67) Total $ 142 $ 139 $ 285 $ 273 INTEREST INCOME SoCalGas $ ― $ 3 $ ― $ 3 Sempra South American Utilities 5 5 10 9 Sempra Mexico 1 2 3 4 Sempra Renewables ― 1 1 1 Sempra Natural Gas 17 25 33 44 Intercompany eliminations (17) (26) (35) (44) Total $ 6 $ 10 $ 12 $ 17 DEPRECIATION AND AMORTIZATION SDG&E $ 158 50 % $ 149 48 % $ 317 49 % $ 294 48 % SoCalGas 112 36 113 37 234 36 226 37 Sempra South American Utilities 14 4 12 4 27 4 25 4 Sempra Mexico 15 5 17 6 32 5 34 6 Sempra Renewables 2 1 1 ― 3 1 3 ― Sempra Natural Gas 12 4 12 4 25 4 24 4 All other 1 ― 3 1 4 1 4 1 Total $ 314 100 % $ 307 100 % $ 642 100 % $ 610 100 % INCOME TAX EXPENSE (BENEFIT) SDG&E $ 48 $ 54 $ 120 $ 142 SoCalGas (29) 16 58 111 Sempra South American Utilities 15 18 29 34 Sempra Mexico (12) 5 29 13 Sempra Renewables (9) (11) (21) (28) Sempra Natural Gas (99) 27 (124) 29 All other (20) (11) (55) (40) Total $ (106) $ 98 $ 36 $ 261 SEGMENT INFORMATION (CONTINUED) (Dollars in millions) Three months ended June 30, Six months ended June 30, 2016 2015 2016 2015 EQUITY EARNINGS (LOSSES) Earnings (losses) recorded before tax: Sempra Renewables $ 11 $ 10 $ 18 $ 12 Sempra Natural Gas 3 17 (26) 34 Total $ 14 $ 27 $ (8) $ 46 Earnings (losses) recorded net of tax: Sempra South American Utilities $ ― $ ― $ 2 $ (1) Sempra Mexico 33 22 48 38 Total $ 33 $ 22 $ 50 $ 37 EARNINGS (LOSSES) SDG&E $ 100 $ 126 $ 229 $ 273 SoCalGas(2) (1) 70 194 284 Sempra South American Utilities 43 45 81 86 Sempra Mexico 57 50 74 97 Sempra Renewables 12 19 25 32 Sempra Natural Gas (149) 40 (185) 42 All other (46) (55) (83) (82) Total $ 16 $ 295 $ 335 $ 732 Six months ended June 30, 2016 2015 EXPENDITURES FOR PROPERTY, PLANT & EQUIPMENT SDG&E $ 602 30 % $ 600 41 % SoCalGas 650 32 603 41 Sempra South American Utilities 82 4 66 5 Sempra Mexico 140 7 120 8 Sempra Renewables 457 23 22 1 Sempra Natural Gas 68 3 28 2 All other 7 1 27 2 Total $ 2,006 100 % $ 1,466 100 % June 30, 2016 December 31, 2015 ASSETS SDG&E $ 17,039 40 % $ 16,515 40 % SoCalGas 13,086 30 12,104 29 Sempra South American Utilities 3,486 8 3,235 8 Sempra Mexico 3,925 9 3,783 9 Sempra Renewables 1,838 4 1,441 4 Sempra Natural Gas 5,396 13 5,566 13 All other 803 2 734 2 Intersegment receivables (2,698) (6) (2,228) (5) Total $ 42,875 100 % $ 41,150 100 % EQUITY METHOD AND OTHER INVESTMENTS Sempra South American Utilities $ (1) $ (4) Sempra Mexico 548 519 Sempra Renewables 827 855 Sempra Natural Gas 818 1,460 All other 75 75 Total $ 2,267 $ 2,905 (1) Revenues for reportable segments include intersegment revenues of a negligible amount, $18 million, $27 million and $36 million for the three months ended June 30, 2016; $3 million, $35 million, $54 million and $66 million for the six months ended June 30, 2016; $3 million, $17 million, $24 million and $46 million for the three months ended June 30, 2015; and $5 million, $36 million, $49 million and $89 million for the six months ended June 30, 2015 for SDG&E, SoCalGas, Sempra Mexico and Sempra Natural Gas, respectively. (2) After preferred dividends. |
NEW ACCOUNTING POLICY (Details)
NEW ACCOUNTING POLICY (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
New Accounting Policies | ||
Tax benefit related to share-based compensation | $ 34 | $ 52 |
Cumulative Effect On Retained Earnings Tax1 | $ 107 |
RECENT BUSINESS ACQUISITIONS (D
RECENT BUSINESS ACQUISITIONS (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | 6 Months Ended |
Jul. 31, 2016 | Mar. 31, 2015 | Jun. 30, 2016 | |
Black Oak Getty Wind [Member] | |||
Business Acquisition [Line Items] | |||
Total business acquisition costs | $ 8 | ||
Ownership Percentage in consolidated entity | 100.00% | ||
PEMEX [Member] | |||
Business Acquisition [Line Items] | |||
Ownership Percentage in consolidated entity | 50.00% | ||
IEnova [Member] | |||
Business Acquisition [Line Items] | |||
Business Acquisition Purchase Price Allocation Equity Method Investment | $ 1,100 | ||
Ownership Percentage in consolidated entity | 25.00% | ||
Equity Method Investment Ownership Percentage | 50.00% | ||
Apple Blossom Wind [Member] | |||
Business Acquisition [Line Items] | |||
Total business acquisition costs | $ 22 | ||
Ownership Percentage in consolidated entity | 100.00% |
ASSETS HELD FOR SALE (Details)
ASSETS HELD FOR SALE (Details) - USD ($) $ in Millions | Apr. 24, 2016 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 |
Disposal Group Including Discontinued Operation Additional Disclosures [Abstract] | |||||
Deferred Tax Expense From The Outside Basis Difference | $ 32 | ||||
Liabilities Assumed | 0 | $ (2) | |||
Termoelectrica de Mexicali [Member] | |||||
Assets Held for Sale, Assets [Abstract] | |||||
Assets Held for Sale, Cash and Cash Equivalent | $ 1 | 1 | |||
Assets Held for Sale, Inventories | 8 | 8 | |||
Assets Held for Sale, Other Current Assets | 21 | 21 | |||
Assets Held for Sale, Regulatory Assets | 0 | 0 | |||
Assets Held for Sale, Goodwill | 0 | 0 | |||
Assets Held for Sale, Other Assets | 17 | 17 | |||
Assets Held for Sale, Property, Plant and Equipment, Net | 250 | 250 | |||
Total Assets Held for Sale | 297 | 297 | |||
Assets Held for Sale, Liabilities [Abstract] | |||||
Assets Held for Sale, Accounts Payable | 1 | 1 | |||
Assets Held for Sale, Other Current Liabilities | 6 | 6 | |||
Assets Held for Sale, Long-term Debt | 0 | 0 | |||
Assets Held for Sale, Deferred Income Taxes | 13 | 13 | |||
Assets Held for Sale, Regulatory Liabilities | 0 | 0 | |||
Assets Held for Sale, Asset Retirement Obligations | 4 | 4 | |||
Assets Held for Sale, Other Liabilities | 19 | 19 | |||
Total Liabilities Held for Sale | 43 | 43 | |||
Disposal Group Including Discontinued Operation Additional Disclosures [Abstract] | |||||
Deferred Tax Expense From The Outside Basis Difference | 3 | 32 | |||
Deferred Tax Expense From The Outside Basis Difference After Noncontrolling Interest | 2 | 26 | |||
Energy South [Member] | |||||
Assets Held for Sale, Assets [Abstract] | |||||
Assets Held for Sale, Cash and Cash Equivalent | 1 | 1 | |||
Assets Held for Sale, Inventories | 3 | 3 | |||
Assets Held for Sale, Other Current Assets | 13 | 13 | |||
Assets Held for Sale, Regulatory Assets | 12 | 12 | |||
Assets Held for Sale, Goodwill | 72 | 72 | |||
Assets Held for Sale, Other Assets | 53 | 53 | |||
Assets Held for Sale, Property, Plant and Equipment, Net | 203 | 203 | |||
Total Assets Held for Sale | 357 | 357 | |||
Assets Held for Sale, Liabilities [Abstract] | |||||
Assets Held for Sale, Accounts Payable | 9 | 9 | |||
Assets Held for Sale, Other Current Liabilities | 12 | 12 | |||
Assets Held for Sale, Long-term Debt | 67 | 67 | |||
Assets Held for Sale, Deferred Income Taxes | 38 | 38 | |||
Assets Held for Sale, Regulatory Liabilities | 22 | 22 | |||
Assets Held for Sale, Asset Retirement Obligations | 12 | 12 | |||
Assets Held for Sale, Other Liabilities | 19 | 19 | |||
Total Liabilities Held for Sale | $ 179 | $ 179 | |||
Disposal Group Including Discontinued Operation Additional Disclosures [Abstract] | |||||
Expected Cash Proceeds on Sale | $ 323 | ||||
Liabilities Assumed | $ 67 | ||||
Outstanding Equity Agreed To Sell, Percentage | 100.00% | ||||
Mesquite Power [Member] | |||||
Disposal Group Including Discontinued Operation Additional Disclosures [Abstract] | |||||
Proceeds from Divestiture of Businesses | $ 347 | ||||
Deconsolidation Gain or Loss Amount After Tax | 36 | ||||
Deconsolidation Gain Or Loss Amount | $ 61 |
DIVESTITURES (Details)
DIVESTITURES (Details) - Rockies Express [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2016 | Jun. 30, 2016 | Mar. 29, 2016 | |
Schedule of Equity Method Investments [Line Items] | |||
Equity Method Investment Ownership Percentage | 25.00% | ||
Equity Method Investment, Other than Temporary Impairment | $ 44 | ||
Equity Method Investment Other Than Temporary Impairment Net Of Tax Benefit | 27 | ||
Equity Method Investments | $ 484 | ||
Proceeds From Sale Of Equity Method Investments | $ 440 | $ 443 | |
Investments In Affiliates Subsidiaries Associates And Joint Ventures Fair Value Disclosure | $ 440 |
INVESTMENTS IN UNCONSOLIDATED30
INVESTMENTS IN UNCONSOLIDATED ENTITIES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investments in Joint Ventures, capitalized interest | $ 20 | $ 17 | $ 38 | $ 34 |
Guarantee Obligations Maximum Exposure | 4,500 | 4,500 | ||
Guarantee Obligations Current Carrying Value | $ 63 | 63 | ||
Sempra Renewables [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Payments To Acquire Equity Method Investments | 18 | 18 | ||
Cameron LNG [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investments in Joint Ventures, capitalized interest | $ 24 | 24 | ||
Payments To Acquire Equity Method Investments | 3 | |||
Accrued project capital call | $ 7 | 7 | ||
Sempra Natural Gas [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Payments To Acquire Equity Method Investments | $ 113 | |||
TransCanada [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investment Ownership Percentage | 60.00% | 60.00% | ||
IEnova [Member] | ||||
Schedule of Equity Method Investments [Line Items] | ||||
Equity Method Investment Ownership Percentage | 40.00% | 40.00% |
OTHER FINANCIAL DATA - VARIABLE
OTHER FINANCIAL DATA - VARIABLE INTEREST ENTITIES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Variable Interest Entities [Line Items] | |||||
Cost Of Electric Fuel And Purchased Power From Utilities | $ 561 | $ 498 | $ 1,076 | $ 979 | |
Other operation and maintenance | 727 | 713 | 1,428 | 1,371 | |
Depreciation and amortization | 314 | 307 | 642 | 610 | |
Other income (expense), net | 23 | 37 | 72 | 76 | |
Interest expense | (142) | (139) | (285) | (273) | |
Net income | 27 | 320 | 357 | 778 | |
Earnings attributable to noncontrolling interest | (10) | (24) | (21) | (45) | |
Earnings attributable to common shares | 16 | 295 | 335 | 732 | |
Otay Mesa VIE [Member] | |||||
Variable Interest Entities [Line Items] | |||||
Cost Of Electric Fuel And Purchased Power From Utilities | (17) | (21) | (34) | (39) | |
Other operation and maintenance | 15 | 6 | 19 | 10 | |
Depreciation and amortization | 10 | 6 | 17 | 12 | |
Operating Expenses | 8 | (9) | 2 | (17) | |
Utility operating income | (8) | 9 | (2) | 17 | |
Interest expense | (5) | (5) | (10) | (9) | |
Net income | (13) | 4 | (12) | 8 | |
Earnings attributable to noncontrolling interest | 13 | (4) | 12 | (8) | |
Earnings attributable to common shares | 0 | $ 0 | 0 | $ 0 | |
Equity of variable interest entity | 37 | 37 | $ 53 | ||
Secured debt of variable interest entity | 310 | 310 | |||
Cameron LNG Holdings [Member] | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Equity Method Investments | $ 818 | $ 818 | $ 983 |
OTHER FINANCIAL DATA - GOODWILL
OTHER FINANCIAL DATA - GOODWILL (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 786 | $ 819 | [1] |
[1] | Derived from audited financial statements. |
OTHER FINANCIAL DATA - PENSION
OTHER FINANCIAL DATA - PENSION AND OTHER POSTRETIREMENT BENEFITS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 27 | $ 29 | $ 55 | $ 59 |
Interest cost | 40 | 39 | 80 | 78 |
Expected return on assets | (41) | (44) | (83) | (88) |
Amortization of prior service cost | 3 | 2 | 6 | 5 |
Amortization of actuarial loss | 7 | 11 | 13 | 19 |
Regulatory adjustment | (28) | (30) | (56) | (59) |
Total net periodic benefit cost | 8 | 7 | 15 | 14 |
Defined benefit plan, contributions by employer | 23 | |||
Defined benefit plan, expected contributions in current fiscal year | 123 | |||
Pension Benefits | San Diego Gas and Electric Company [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 8 | 8 | 15 | 16 |
Interest cost | 11 | 10 | 21 | 20 |
Expected return on assets | (13) | (13) | (25) | (27) |
Amortization of prior service cost | 1 | 1 | 1 | 1 |
Amortization of actuarial loss | 2 | 2 | 5 | 4 |
Regulatory adjustment | (8) | (7) | (15) | (12) |
Total net periodic benefit cost | 1 | 1 | 2 | 2 |
Defined benefit plan, contributions by employer | 2 | |||
Defined benefit plan, expected contributions in current fiscal year | 4 | |||
Pension Benefits | Southern California Gas Company [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 18 | 19 | 35 | 38 |
Interest cost | 25 | 24 | 50 | 49 |
Expected return on assets | (27) | (27) | (52) | (54) |
Amortization of prior service cost | 2 | 2 | 4 | 4 |
Amortization of actuarial loss | 2 | 6 | 5 | 11 |
Regulatory adjustment | (20) | (23) | (41) | (47) |
Total net periodic benefit cost | 0 | 1 | 1 | 1 |
Defined benefit plan, contributions by employer | 0 | |||
Defined benefit plan, expected contributions in current fiscal year | 77 | |||
Other Postretirement Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 6 | 7 | 11 | 14 |
Interest cost | 11 | 11 | 22 | 23 |
Expected return on assets | (18) | (17) | (35) | (34) |
Amortization of prior service cost | 0 | 0 | 0 | (1) |
Amortization of actuarial loss | 0 | 0 | 0 | 0 |
Regulatory adjustment | 2 | 0 | 4 | 0 |
Total net periodic benefit cost | 1 | 1 | 2 | 2 |
Defined benefit plan, contributions by employer | 2 | |||
Defined benefit plan, expected contributions in current fiscal year | 6 | |||
Other Postretirement Benefits | San Diego Gas and Electric Company [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 1 | 2 | 2 | 4 |
Interest cost | 2 | 2 | 4 | 4 |
Expected return on assets | (2) | (3) | (5) | (6) |
Amortization of prior service cost | 1 | 1 | 2 | 2 |
Amortization of actuarial loss | (1) | 0 | (1) | 0 |
Regulatory adjustment | (1) | (2) | (2) | (4) |
Total net periodic benefit cost | 0 | 0 | 0 | 0 |
Defined benefit plan, contributions by employer | 0 | |||
Defined benefit plan, expected contributions in current fiscal year | 2 | |||
Other Postretirement Benefits | Southern California Gas Company [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 3 | 5 | 7 | 10 |
Interest cost | 9 | 9 | 17 | 18 |
Expected return on assets | (14) | (14) | (28) | (28) |
Amortization of prior service cost | (1) | (2) | (2) | (4) |
Amortization of actuarial loss | 0 | 0 | 0 | 0 |
Regulatory adjustment | 3 | 2 | 6 | 4 |
Total net periodic benefit cost | $ 0 | $ 0 | 0 | $ 0 |
Defined benefit plan, contributions by employer | 1 | |||
Defined benefit plan, expected contributions in current fiscal year | $ 1 |
OTHER FINANCIAL DATA - RABBI TR
OTHER FINANCIAL DATA - RABBI TRUST (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | |
Assets Noncurrent [Abstract] | |||
Rabbi Trust | $ 436 | $ 464 | [1] |
[1] | Derived from audited financial statements. |
OTHER FINANCIAL DATA - EARNINGS
OTHER FINANCIAL DATA - EARNINGS PER SHARE (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Earnings Per Share [Abstract] | |||||
Basic earnings per common share | $ 0.06 | $ 1.19 | $ 1.34 | $ 2.95 | |
Weighted-average common shares outstanding for basic EPS | [1] | 250,096,000 | 248,108,000 | 249,915,000 | 247,916,000 |
Diluted earnings per common share | $ 0.06 | $ 1.17 | $ 1.33 | $ 2.91 | |
Weighted-average common shares outstanding for diluted EPS | 251,938,000 | 251,491,000 | 251,686,000 | 251,264,000 | |
Vested RSUs included in basic WASO | 568,000 | 501,000 | 562,000 | 476,000 | |
Dilutive effect of stock options, restricted stock awards and restricted stock units | 1,842,000 | 3,383,000 | 1,771,000 | 3,348,000 | |
Shares excluded from potential dilutive shares | 1,417,481 | 1,370,460 | 1,491,195 | 1,424,855 | |
Earnings | $ 16 | $ 295 | $ 335 | $ 732 | |
Out Of The Money Stock Options [Member] | |||||
Antidilutive Securities Excluded From Computation of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share | 0 | 0 | 0 | 0 | |
Employee Stock Option [Member] | |||||
Antidilutive Securities Excluded From Computation of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share | 0 | 0 | 0 | 0 | |
Restricted Stock [Member] | |||||
Antidilutive Securities Excluded From Computation of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share | 0 | 0 | 0 | 0 | |
Restricted Stock Units [Member] | |||||
Antidilutive Securities Excluded From Computation of Earnings Per Share [Line Items] | |||||
Antidilutive securities excluded from computation of earnings per share | 1,010 | 4,715 | 2,408 | 4,715 | |
[1] | Includes 568 and 501 average fully vested restricted stock units held in our Deferred Compensation Plan for the three months ended June 30, 2016 and 2015, respectively, and 562 and 476 of such units for the six months ended June 30, 2016 and 2015, 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. |
OTHER FINANCIAL DATA - EARNIN36
OTHER FINANCIAL DATA - EARNINGS PER SHARE - SHARE BASED COMPENSATION (Details) | 3 Months Ended |
Jun. 30, 2016 | |
Performance RSU minimum [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 0.00% |
Performance RSU max prior to 2014 [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 150.00% |
Performance RSU max in 2014 and after [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 200.00% |
Service and Other Awards max [Member] | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Sharebased Compensation Arrangement By Sharebased Payment Award Award Vesting Rights Percentage | 100.00% |
OTHER FINANCIAL DATA - SHARE-BA
OTHER FINANCIAL DATA - SHARE-BASED COMPENSATION (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Allocated Share Based Compensation Expense Net Of Tax | $ 6 | $ 7 | $ 13 | $ 15 |
IENova Plans [Member] [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units granted | 183,970 | |||
Service-Based [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units granted | 95,876 | |||
Performance-Based, Total Shareholder Return [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units granted | 373,070 | |||
Performance-Based, Earnings Per Share [Member] | ||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||
Restricted stock units granted | 94,760 |
OTHER FINANCIAL DATA - CAPITALI
OTHER FINANCIAL DATA - CAPITALIZED FINANCING COSTS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Capitalized Financing Costs Disclosure [Line Items] | ||||
AFUDC related to debt | $ 8 | $ 7 | $ 15 | $ 13 |
AFUDC related to equity | 30 | 31 | 57 | 58 |
Other capitalized financing costs | 20 | 17 | 38 | 34 |
Total capitalized financing costs | 58 | 55 | 110 | 105 |
San Diego Gas and Electric Company [Member] | ||||
Capitalized Financing Costs Disclosure [Line Items] | ||||
AFUDC related to debt | 4 | 4 | 8 | 7 |
AFUDC related to equity | 13 | 10 | 24 | 18 |
Total capitalized financing costs | 17 | 14 | 32 | 25 |
Southern California Gas Company [Member] | ||||
Capitalized Financing Costs Disclosure [Line Items] | ||||
AFUDC related to debt | 4 | 3 | 7 | 6 |
AFUDC related to equity | 10 | 10 | 20 | 19 |
Total capitalized financing costs | $ 14 | $ 13 | $ 27 | $ 25 |
OTHER FINANCIAL DATA - SHAREHOL
OTHER FINANCIAL DATA - SHAREHOLDER'S EQUITY AND NONCONTROLLING INTEREST (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |||
Equity, beginning of period | $ 12,579 | [1] | $ 12,100 | |||
Comprehensive income (loss) | 312 | 667 | ||||
Share-based compensation expense | 24 | 26 | ||||
Common stock dividends declared | (377) | (347) | ||||
Preferred dividends of subsidiary | $ (1) | $ (1) | (1) | (1) | ||
Issuance of common stock | 56 | 59 | ||||
Repurchases of common stock | (54) | (66) | ||||
Tax benefit related to share-based compensation | 34 | 52 | ||||
Equity contributed by noncontrolling interest | 1 | 1 | ||||
Distributions to noncontrolling interests | (11) | (16) | ||||
Equity, end of period | 12,563 | 12,475 | 12,563 | 12,475 | ||
San Diego Gas and Electric Company [Member] | ||||||
Equity, beginning of period | 5,276 | [1] | 4,992 | |||
Comprehensive income (loss) | 216 | 282 | ||||
Common stock dividends declared | (175) | |||||
Distributions to noncontrolling interests | (3) | (8) | ||||
Equity, end of period | 5,314 | 5,266 | 5,314 | 5,266 | ||
Southern California Gas Company [Member] | ||||||
Equity, beginning of period | 3,149 | [1] | 2,781 | |||
Comprehensive income (loss) | 195 | 285 | ||||
Preferred dividend requirements | 1 | 1 | 1 | 1 | ||
Equity, end of period | 3,343 | 3,065 | 3,343 | 3,065 | ||
Total Shareholders' Equity [Member] | ||||||
Equity, beginning of period | 11,809 | 11,326 | ||||
Comprehensive income (loss) | 290 | 634 | ||||
Share-based compensation expense | 24 | 26 | ||||
Common stock dividends declared | (377) | (347) | ||||
Preferred dividends of subsidiary | (1) | (1) | ||||
Issuance of common stock | 56 | 59 | ||||
Repurchases of common stock | (54) | (66) | ||||
Tax benefit related to share-based compensation | 34 | 52 | ||||
Equity contributed by noncontrolling interest | 0 | 0 | ||||
Distributions to noncontrolling interests | 0 | 0 | ||||
Equity, end of period | 11,781 | 11,683 | 11,781 | 11,683 | ||
Total Shareholders' Equity [Member] | San Diego Gas and Electric Company [Member] | ||||||
Equity, beginning of period | 5,223 | 4,932 | ||||
Comprehensive income (loss) | 229 | 273 | ||||
Common stock dividends declared | (175) | |||||
Distributions to noncontrolling interests | 0 | 0 | ||||
Equity, end of period | 5,277 | 5,205 | 5,277 | 5,205 | ||
Noncontrolling Interests [Member] | ||||||
Equity, beginning of period | [2] | 770 | 774 | |||
Comprehensive income (loss) | [2] | 22 | 33 | |||
Share-based compensation expense | [2] | 0 | 0 | |||
Common stock dividends declared | [2] | 0 | 0 | |||
Preferred dividends of subsidiary | [2] | 0 | 0 | |||
Issuance of common stock | [2] | 0 | 0 | |||
Repurchases of common stock | [2] | 0 | 0 | |||
Tax benefit related to share-based compensation | [2] | 0 | 0 | |||
Equity contributed by noncontrolling interest | [2] | 1 | 1 | |||
Distributions to noncontrolling interests | [2] | (11) | (16) | |||
Equity, end of period | [2] | 782 | 792 | 782 | 792 | |
Noncontrolling Interests [Member] | San Diego Gas and Electric Company [Member] | ||||||
Equity, beginning of period | 53 | 60 | ||||
Comprehensive income (loss) | (13) | 9 | ||||
Common stock dividends declared | 0 | |||||
Distributions to noncontrolling interests | (3) | (8) | ||||
Equity, end of period | $ 37 | $ 61 | $ 37 | $ 61 | ||
[1] | Derived from audited financial statements. | |||||
[2] | Noncontrolling interests include the preferred stock of SoCalGas and other noncontrolling interests as listed in the table below under "Other Noncontrolling Interests." |
OTHER FINANCIAL DATA - CHANGES
OTHER FINANCIAL DATA - CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, beginning balance | [1] | $ (821) | $ (613) | [2] | $ (806) | [2] | $ (497) | |
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | [1] | (37) | 14 | (51) | (102) | |||
Amounts Reclassified From Accumulated Other Comprehensive Income | [1] | 6 | 3 | 5 | 3 | |||
Net Other Comprehensive Income | [1] | (31) | 17 | (46) | (99) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax, ending balance | [1] | (852) | (596) | [2] | (852) | (596) | [2] | |
San Diego Gas and Electric Company [Member] | ||||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, beginning balance | [2] | (8) | ||||||
Amounts Reclassified From Accumulated Other Comprehensive Income | 0 | 0 | 0 | 0 | ||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, ending balance | [1] | (8) | (8) | |||||
Southern California Gas Company [Member] | ||||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, beginning balance | [2] | (19) | ||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, ending balance | [1] | (19) | (19) | |||||
Accumulated Translation Adjustment [Member] | ||||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, beginning balance | [1] | (514) | (384) | (582) | (322) | |||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | [1] | 11 | (43) | 79 | (105) | |||
Amounts Reclassified From Accumulated Other Comprehensive Income | [1] | 0 | 0 | 0 | 0 | |||
Net Other Comprehensive Income | [1] | 11 | (43) | 79 | (105) | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax, ending balance | [1] | (503) | (427) | (503) | (427) | |||
Accumulated Net Gain Loss From Designated Or Qualifying Cash Flow Hedges [Member] | ||||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, beginning balance | [1] | (221) | (145) | (137) | (90) | |||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | [1] | (48) | 57 | (130) | 3 | |||
Amounts Reclassified From Accumulated Other Comprehensive Income | [1] | 5 | 2 | 3 | 1 | |||
Net Other Comprehensive Income | [1] | (43) | 59 | (127) | 4 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax, ending balance | [1] | (264) | (86) | (264) | (86) | |||
Accumulated Defined Benefit Plans Adjustment [Member] | ||||||||
Accumulated Other Comprehensive Income Loss [Line Items] | ||||||||
Accumulated Other Comprehensive Income (Loss), Net of Tax, beginning balance | [1] | (86) | (84) | (87) | (85) | |||
Other Comprehensive Income Loss Before Reclassifications Net Of Tax | [1] | 0 | 0 | 0 | 0 | |||
Amounts Reclassified From Accumulated Other Comprehensive Income | [1] | 1 | 1 | 2 | 2 | |||
Net Other Comprehensive Income | [1] | 1 | 1 | 2 | 2 | |||
Accumulated Other Comprehensive Income (Loss), Net of Tax, ending balance | [1] | $ (85) | $ (83) | $ (85) | $ (83) | |||
[1] | All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests. | |||||||
[2] | Derived from audited financial statements. |
OTHER FINANCIAL DATA - RECLASSI
OTHER FINANCIAL DATA - RECLASSIFICATION FROM ACCUMULATED OTHER COMPREHENSIVE INCOME (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | $ (142) | $ (139) | $ (285) | $ (273) | |
Equity earnings, net of income tax. | 33 | 22 | 50 | 37 | |
Equity Earnings (Losses) Recorded Before Tax | 14 | 27 | (8) | 46 | |
Revenues - energy related businesses | 162 | 234 | 342 | 494 | |
Total before income tax | (112) | 396 | 343 | 1,002 | |
Income tax (expense) benefit | 106 | (98) | (36) | (261) | |
Earnings attributable to noncontrolling interest | (10) | (24) | (21) | (45) | |
Earnings | 16 | 295 | 335 | 732 | |
Amounts Reclassified From Accumulated Other Comprehensive Income | [1] | 6 | 3 | 5 | 3 |
San Diego Gas and Electric Company [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | (48) | (52) | (96) | (104) | |
Total before income tax | 135 | 184 | 337 | 423 | |
Income tax (expense) benefit | (48) | (54) | (120) | (142) | |
Earnings attributable to noncontrolling interest | 13 | (4) | 12 | (8) | |
Earnings | 100 | 126 | 229 | 273 | |
Amounts Reclassified From Accumulated Other Comprehensive Income | 0 | 0 | 0 | 0 | |
Southern California Gas Company [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | (24) | (19) | (46) | (38) | |
Total before income tax | (29) | 87 | 253 | 396 | |
Income tax (expense) benefit | 29 | (16) | (58) | (111) | |
Earnings | 0 | 71 | 195 | 285 | |
Accumulated Net Gain Loss From Cash Flow Hedges Including Portion Attributable To Noncontrolling Interest [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Total before income tax | 10 | 6 | 11 | 8 | |
Income tax (expense) benefit | (1) | (1) | (1) | 0 | |
Net of Income Tax | 9 | 5 | 10 | 8 | |
Accumulated Net Gain Loss From Cash Flow Hedges Including Portion Attributable To Noncontrolling Interest [Member] | Interest Rate Instruments | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Equity Earnings (Losses) Recorded Before Tax | 2 | 3 | 5 | 6 | |
Accumulated Net Gain Loss From Cash Flow Hedges Including Portion Attributable To Noncontrolling Interest [Member] | Interest Rate Instruments | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | San Diego Gas and Electric Company [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | 3 | 3 | 6 | 6 | |
Accumulated Net Gain Loss From Cash Flow Hedges Including Portion Attributable To Noncontrolling Interest [Member] | Interest Rate And Foreign Exchange Instruments [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Interest expense | 3 | 3 | 7 | 9 | |
Equity earnings, net of income tax. | 5 | 0 | 6 | 0 | |
Accumulated Net Gain Loss From Cash Flow Hedges Including Portion Attributable To Noncontrolling Interest [Member] | Commodity Contracts Not Subject To Rate Recovery | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Revenues - energy related businesses | (7) | (7) | |||
Accumulated Net Gain Loss From Cash Flow Hedges Attributable To Noncontrolling Interest [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Earnings attributable to noncontrolling interest | (4) | (3) | (7) | (7) | |
Accumulated Net Gain Loss From Cash Flow Hedges Attributable To Noncontrolling Interest [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | San Diego Gas and Electric Company [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Earnings attributable to noncontrolling interest | (3) | (3) | (6) | (6) | |
Accumulated Net Gain Loss From Designated Or Qualifying Cash Flow Hedges [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Amounts Reclassified From Accumulated Other Comprehensive Income | [1] | 5 | 2 | 3 | 1 |
Accumulated Net Gain Loss From Designated Or Qualifying Cash Flow Hedges [Member] | Reclassification Out Of Accumulated Other Comprehensive Income [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Earnings | 5 | 2 | 3 | 1 | |
Accumulated Defined Benefit Plans Adjustment Net Unamortized Gain Loss [Member] | |||||
Reclassification Adjustment Out Of Accumulated Other Comprehensive Income [Line Items] | |||||
Reclassification From Accumulated Other Comprehensive Income, Current Period, beforeTax | [2] | 2 | 2 | 4 | 4 |
Current Period Tax | (1) | (1) | (2) | (2) | |
Amounts Reclassified From Accumulated Other Comprehensive Income | $ 1 | $ 1 | $ 2 | $ 2 | |
[1] | All amounts are net of income tax, if subject to tax, and exclude noncontrolling interests. | ||||
[2] | Amounts are included in the computation of net periodic benefit cost (see "Pension and Other Postretirement Benefits" above). |
OTHER FINANCIAL DATA - OTHER NO
OTHER FINANCIAL DATA - OTHER NONCONTROLLING INTERESTS (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | ||
Noncontrolling Interest [Line Items] | ||||
Noncontrolling interests | $ 762 | $ 750 | [1] | |
Ownership Interests Held By Others, Bay Gas Storage Company [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 9.10% | 9.10% | ||
Other Noncontrolling Interests | $ 26 | $ 25 | ||
Ownership Interests Held By Others, Southern Gas Transmission [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 49.00% | 49.00% | ||
Other Noncontrolling Interests | $ 1 | $ 1 | ||
Ownership Interests Held By Others, Liberty Gas Storage [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 23.30% | 23.20% | ||
Other Noncontrolling Interests | $ 14 | $ 14 | ||
Ownership Interests Held By Others, Tecsur [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 9.80% | 9.80% | ||
Other Noncontrolling Interests | $ 4 | $ 4 | ||
Ownership Interests Held By Others, Luz Del Sur [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 16.40% | 16.40% | ||
Other Noncontrolling Interests | $ 175 | $ 164 | ||
Ownership Interests Held By Others, Chilquinta Energia [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Percent Of Ownership Held By Others Minimum | [2] | 23.20% | 23.50% | |
Percent Of Ownership Held By Others Maximum | [2] | 43.40% | 43.40% | |
Other Noncontrolling Interests | [2] | $ 21 | $ 21 | |
Ownership Interests Held By Others, Otay Mesa VIE [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 100.00% | 100.00% | ||
Other Noncontrolling Interests | $ 37 | $ 53 | ||
Ownership Interests Held By Others IEnova [Member] | ||||
Noncontrolling Interest [Line Items] | ||||
Minority Interest Ownership Percentage By Noncontrolling Owners | 18.90% | 18.90% | ||
Other Noncontrolling Interests | $ 484 | $ 468 | ||
[1] | Derived from audited financial statements. | |||
[2] | Chilquinta Energía has four subsidiaries with noncontrolling interests held by others. Percentage range reflects the highest and lowest ownership percentages among these subsidiaries. |
OTHER FINANCIAL DATA - DUE TO D
OTHER FINANCIAL DATA - DUE TO DUE FROM AFFILIATES (Details) - USD ($) | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2016 | Dec. 31, 2015 | ||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | $ 6,000,000 | $ 6,000,000 | [1] | ||
Due to affiliaties, current | (8,000,000) | (14,000,000) | [1] | ||
Due from unconsolidated affiliates | 192,000,000 | 186,000,000 | [1] | ||
San Diego Gas and Electric Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | 163,000,000 | 1,000,000 | [1] | ||
Due to affiliaties, current | (190,000,000) | (55,000,000) | [1] | ||
Southern California Gas Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | 7,000,000 | 48,000,000 | [1] | ||
Due to affiliaties, current | (25,000,000) | 0 | [1] | ||
Due to/from Sempra Energy | San Diego Gas and Electric Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | 163,000,000 | [2] | 0 | ||
Due to affiliaties, current | 0 | (34,000,000) | |||
Income taxes due from Sempra Energy | $ 59,000,000 | 28,000,000 | [3] | ||
Interest rate on due from affiliate, noncurrent | 0.35% | ||||
Loan to unconsolidated affiliate, principal | $ 172,000,000 | ||||
Due to/from Sempra Energy | Southern California Gas Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | 0 | 35,000,000 | [4] | ||
Due to affiliaties, current | (25,000,000) | 0 | |||
Income taxes due from Sempra Energy | 9,000,000 | $ 1,000,000 | [3] | ||
Interest rate on due from affiliate, noncurrent | 0.11% | ||||
Loan to unconsolidated affiliate, principal | $ 50,000,000 | ||||
Due to/from SDG&E | Southern California Gas Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | 7,000,000 | 13,000,000 | |||
Due to/from SoCalGas | San Diego Gas and Electric Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due to affiliaties, current | (7,000,000) | (13,000,000) | |||
Due to/from Other Affiliates | San Diego Gas and Electric Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from affiliates, current | $ 0 | 1,000,000 | |||
Joint venture with PEMEX [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Interest rate on due from affiliate, noncurrent | 4.97% | ||||
PEMEX Four year loan C [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | [5],[6] | $ 8,000,000 | 8,000,000 | ||
PEMEX Three year loan A [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | [5],[6] | 2,000,000 | 3,000,000 | ||
PEMEX Four year loan B [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | [5],[6] | 35,000,000 | 34,000,000 | ||
PEMEX Four year loan A [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | [5],[6] | 43,000,000 | 42,000,000 | ||
ESJ joint venture [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | [5],[7] | $ 17,000,000 | 24,000,000 | ||
Interest rate on due from affiliate, noncurrent | 6.84% | ||||
Eletrans [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | [5],[8] | $ 79,000,000 | 72,000,000 | ||
Interest rate on due from affiliate, noncurrent | 4.00% | ||||
Sempra South American Utilities [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | $ 2,000,000 | 0 | |||
Sempra Natural Gas Segment [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due from unconsolidated affiliates | 6,000,000 | 3,000,000 | |||
Affiliate Of Investee [Member] | San Diego Gas and Electric Company [Member] | |||||
Transactions With Affiliates Disclosure [Line Items] | |||||
Due to affiliaties, current | $ (183,000,000) | $ (8,000,000) | |||
[1] | Derived from audited financial statements. | ||||
[2] | At June 30, 2016, net receivable included outstanding advances to Sempra Energy of $172 million at an interest rate of 0.35 percent. | ||||
[3] | 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. | ||||
[4] | At December 31, 2015, net receivable included outstanding advances to Sempra Energy of $50 million at an interest rate of 0.11 percent. | ||||
[5] | Amounts include principal balances plus accumulated interest outstanding. | ||||
[6] | U.S. dollar-denominated loan, at a variable interest rate based on a 30-day LIBOR plus 450 basis points (4.97 percent at June 30, 2016), to finance the Los Ramones Norte pipeline project. | ||||
[7] | U.S. dollar-denominated loan, at a variable interest rate based on a 30-day LIBOR plus 637.5 basis points (6.84 percent at June 30, 2016), to finance the first phase of the Energía Sierra Juárez wind project, which is a joint venture of IEnova. | ||||
[8] | U.S. dollar-denominated loan, at a fixed interest rate with no stated maturity date, to provide project financing for the construction of transmission lines at Eletrans S.A. and Eletrans II S.A., both of which are joint ventures at Chilquinta Energía. |
OTHER FINANCIAL DATA - AFFILIAT
OTHER FINANCIAL DATA - AFFILIATES REVENUE AND COST OF SALES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Transactions With Affiliates Disclosure [Line Items] | ||||
Revenue from related parties | $ 5 | $ 8 | $ 10 | $ 16 |
Costs and Expenses Related Party | 20 | 30 | 50 | 49 |
S D G E Segment [Member] | ||||
Transactions With Affiliates Disclosure [Line Items] | ||||
Revenue from related parties | 0 | 2 | 3 | 5 |
Costs and Expenses Related Party | 16 | 13 | 30 | 18 |
So Cal Gas Segment [Member] | ||||
Transactions With Affiliates Disclosure [Line Items] | ||||
Revenue from related parties | $ 18 | $ 17 | $ 35 | $ 36 |
OTHER FINANCIAL DATA - OTHER IN
OTHER FINANCIAL DATA - OTHER INCOME (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Component of Other Income, Nonoperating [Line Items] | |||||
AFUDC related to equity | $ 30 | $ 31 | $ 57 | $ 58 | |
Investment gains (losses) | [1] | 10 | (2) | 20 | 7 |
Electrical infrastructure relocation income | [2] | 2 | 4 | 3 | 4 |
Gains (losses) on interest rate and foreign exchange instruments, net | (15) | (3) | (12) | (3) | |
Sale of other investments | 1 | 6 | 2 | 6 | |
Foreign currency transaction losses | (5) | (2) | (7) | (3) | |
Regulatory Interest, net | [3] | 1 | 1 | 3 | 2 |
Sundry, net | (1) | 2 | 6 | 5 | |
Total | 23 | 37 | 72 | 76 | |
San Diego Gas and Electric Company [Member] | |||||
Component of Other Income, Nonoperating [Line Items] | |||||
AFUDC related to equity | 13 | 10 | 24 | 18 | |
Regulatory Interest, net | [3] | 1 | 1 | 3 | 2 |
Sundry, net | (1) | (2) | 0 | (2) | |
Total | 13 | 9 | 27 | 18 | |
Southern California Gas Company [Member] | |||||
Component of Other Income, Nonoperating [Line Items] | |||||
AFUDC related to equity | 10 | 10 | 20 | 19 | |
Sundry, net | (4) | (1) | (4) | (2) | |
Total | $ 6 | $ 9 | $ 16 | $ 17 | |
[1] | Represents investment gains (losses) on dedicated assets in support of our executive retirement and deferred compensation plans. These amounts are partially offset by corresponding changes in compensation expense related to the plans. | ||||
[2] | Income at Luz del Sur associated with the relocation of electrical infrastructure. | ||||
[3] | Interest on regulatory balancing accounts. |
OTHER FINANCIAL DATA - INCOME T
OTHER FINANCIAL DATA - INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items] | ||||
Income tax expense (benefit) | $ (106) | $ 98 | $ 36 | $ 261 |
Effective income tax rate | 95.00% | 25.00% | 10.00% | 26.00% |
Deferred Tax Expense From The Outside Basis Difference | $ 32 | |||
San Diego Gas and Electric Company [Member] | ||||
Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items] | ||||
Income tax expense (benefit) | $ 48 | $ 54 | $ 120 | $ 142 |
Effective income tax rate | 36.00% | 29.00% | 36.00% | 34.00% |
Southern California Gas Company [Member] | ||||
Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items] | ||||
Income tax expense (benefit) | $ (29) | $ 16 | $ 58 | $ 111 |
Effective income tax rate | 100.00% | 18.00% | 23.00% | 28.00% |
Southern California Gas Company [Member] | Pre Tax [Member] | ||||
Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items] | ||||
General Rate Case, Earnings Charge Due To Income Tax Forecasted Incurred | $ 15 | $ 15 | ||
Southern California Gas Company [Member] | After Tax [Member] | ||||
Income Tax Expense And Effective Income Tax Rates Disclosure [Line Items] | ||||
General Rate Case, Earnings Charge Due To Income Tax Forecasted Incurred | $ 9 | $ 9 |
OTHER FINANCIAL DATA - INVENTOR
OTHER FINANCIAL DATA - INVENTORY (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | ||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | $ 97 | $ 149 | ||
Energy Related Inventory, Liquefied Natural Gas | 11 | 6 | ||
Energy Related Inventory, Materials And Supplies | 162 | 143 | ||
Inventory, Total | 270 | 298 | [1] | |
S D G E Segment [Member] | ||||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | 1 | 6 | ||
Energy Related Inventory, Liquefied Natural Gas | 0 | 0 | ||
Energy Related Inventory, Materials And Supplies | 70 | 69 | ||
Inventory, Total | 71 | 75 | ||
So Cal Gas Segment [Member] | ||||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | [2] | 0 | 49 | |
Energy Related Inventory, Liquefied Natural Gas | [2] | 0 | 0 | |
Energy Related Inventory, Materials And Supplies | [2] | 44 | 30 | |
Inventory, Total | [2] | 44 | 79 | |
Sempra South American Utilities Segment [Member] | ||||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | 0 | 0 | ||
Energy Related Inventory, Liquefied Natural Gas | 0 | 0 | ||
Energy Related Inventory, Materials And Supplies | 43 | 30 | ||
Inventory, Total | 43 | 30 | ||
Sempra Mexico Segment [Member] | ||||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | 0 | 0 | ||
Energy Related Inventory, Liquefied Natural Gas | 7 | 3 | ||
Energy Related Inventory, Materials And Supplies | 2 | 10 | ||
Inventory, Total | 9 | 13 | ||
Sempra Renewables Segment [Member] | ||||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | 0 | 0 | ||
Energy Related Inventory, Liquefied Natural Gas | 0 | 0 | ||
Energy Related Inventory, Materials And Supplies | 3 | 3 | ||
Inventory, Total | 3 | 3 | ||
Sempra Natural Gas Segment [Member] | ||||
Inventory [Line Items] | ||||
Energy Related Inventory, Natural Gas in Storage | 96 | 94 | ||
Energy Related Inventory, Liquefied Natural Gas | 4 | 3 | ||
Energy Related Inventory, Materials And Supplies | 0 | 1 | ||
Inventory, Total | $ 100 | $ 98 | ||
[1] | Derived from audited financial statements. | |||
[2] | At both June 30, 2016 and December 31, 2015, 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. |
DEBT AND CREDIT FACILITIES - LI
DEBT AND CREDIT FACILITIES - LINES OF CREDIT (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 |
Line Of Credit Facility, Sempra Energy Consolidated [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | $ 4,200 | |
Committed lines of credit, remaining borrowing capacity | $ 2,500 | |
Weighted average interest rate on total short-term debt outstanding | 1.21% | 1.09% |
Line Of Credit Facility, Sempra Energy [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | $ 1,000 | |
Committed lines of credit, maximum ratio of indebtedness to total capitalization | 65.00% | |
Committed lines of credit, capacity for issuance of letters of credit | $ 400 | |
Committed lines of credit, outstanding borrowings | 0 | |
Line Of Credit Facility, Sempra Global [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | $ 2,210 | |
Committed lines of credit, maximum ratio of indebtedness to total capitalization | 65.00% | |
Committed lines of credit, remaining borrowing capacity | $ 643 | |
Outstanding commercial paper supported by committed lines of credit | 1,600 | |
Line Of Credit Facility, S D G E [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | $ 750 | |
Committed lines of credit, maximum ratio of indebtedness to total capitalization | 65.00% | |
Committed lines of credit, remaining borrowing capacity | $ 696 | |
Outstanding commercial paper supported by committed lines of credit | $ 54 | |
Weighted average interest rate on total short-term debt outstanding | 1.06% | 1.01% |
Line Of Credit Facility, So Cal Gas [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | $ 750 | |
Committed lines of credit, maximum ratio of indebtedness to total capitalization | 65.00% | |
Committed lines of credit, remaining borrowing capacity | $ 750 | |
Outstanding commercial paper supported by committed lines of credit | 0 | |
Line Of Credit Facility, California Utilities Combined [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | 1,000 | |
Committed lines of credit, capacity for issuance of letters of credit | 250 | |
Line Of Credit Facility, South American Utilities And Mexico [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | 1,100 | |
Committed lines of credit, remaining borrowing capacity | 843 | |
Line Of Credit Facility Sempra Mexico [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | 600 | |
Committed lines of credit, remaining borrowing capacity | 479 | |
Committed lines of credit, outstanding borrowings | 121 | |
Line Of Credit Facility, Peruvian Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, remaining borrowing capacity | 252 | |
Committed lines of credit, outstanding borrowings | 167 | |
Bank Guarantee | 16 | |
Line Of Credit Facility, Chilean Facility [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, remaining borrowing capacity | 112 | |
Committed lines of credit, outstanding borrowings | 0 | |
Line Of Credit Facility Sempra South America [Member] | ||
Line of Credit Facility [Line Items] | ||
Committed lines of credit, maximum borrowing capacity | $ 547 | |
Committed lines of credit, maximum ratio of debt to equity | 170.00% |
DEBT AND CREDIT FACILITIES - LO
DEBT AND CREDIT FACILITIES - LONG TERM DEBT (Details) $ in Millions | Jun. 30, 2016USD ($) |
Other Long Term Debt, Variable Rate Due 2027 [Member] | San Diego Gas and Electric Company [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% |
Early Redemption Of Long Term Debt Instruments | $ 105 |
Other Long Term Debt Fixed Rate Due 2026 [Member] | San Diego Gas and Electric Company [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 500 |
Debt Instrument, Interest Rate, Stated Percentage | 2.50% |
Other Long Term Debt Fixed Rate Due 2026 [Member] | Southern California Gas Company [Member] | |
Debt Instrument [Line Items] | |
Debt Instrument, Face Amount | $ 500 |
Debt Instrument, Interest Rate, Stated Percentage | 2.60% |
DERIVATIVE COMMODITY VOLUMES (D
DERIVATIVE COMMODITY VOLUMES (Details) | Jun. 30, 2016 | Dec. 31, 2015 | |
S D G E Segment [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Commodity Derivative Volumes Natural Gas | [1] | 72 | 70 |
Commodity Derivative Volumes Electric Power | [2] | 1 | 1 |
Commodity Derivative Volumes Congestion Revenue Rights | [2] | 30 | 36 |
So Cal Gas Segment [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Commodity Derivative Volumes Natural Gas | [1] | 0 | 1 |
Sempra Natural Gas Segment [Member] | |||
Derivatives, Fair Value [Line Items] | |||
Commodity Derivative Volumes Natural Gas | [1] | 30 | 43 |
[1] | Million British thermal units | ||
[2] | Megawatt hours |
DERIVATIVE NOTIONALS (Details)
DERIVATIVE NOTIONALS (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2015 | |
Cash Flow Hedges | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability Notional Amount | $ 377 | $ 384 |
Cash Flow Hedges | Cross Currency Interest Rate Contract [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability Notional Amount | $ 408 | $ 408 |
Cash Flow Hedges | Minimum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,016 | 2,016 |
Cash Flow Hedges | Minimum [Member] | Cross Currency Interest Rate Contract [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,018 | 2,018 |
Cash Flow Hedges | Maximum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,028 | 2,028 |
Cash Flow Hedges | Maximum [Member] | Cross Currency Interest Rate Contract [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,023 | 2,023 |
Fair Value Hedges | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability Notional Amount | $ 0 | $ 300 |
Fair Value Hedges | Maximum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 0 | 2,016 |
Undesignated Derivatives | Foreign Exchange Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability Notional Amount | $ 550 | $ 0 |
Undesignated Derivatives | Maximum [Member] | Foreign Exchange Instrument | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,016 | 0 |
San Diego Gas and Electric Company [Member] | Cash Flow Hedges | ||
Derivatives, Fair Value [Line Items] | ||
Derivative Liability Notional Amount | $ 310 | $ 315 |
San Diego Gas and Electric Company [Member] | Cash Flow Hedges | Minimum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,016 | 2,016 |
San Diego Gas and Electric Company [Member] | Cash Flow Hedges | Maximum [Member] | ||
Derivatives, Fair Value [Line Items] | ||
Maturities of interest rate derivatives | 2,019 | 2,019 |
DERIVATIVE INSTRUMENTS ON THE C
DERIVATIVE INSTRUMENTS ON THE CONDENSED BALANCE SHEET (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | |
Other Current Assets [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [1],[2] | $ 1 | $ 4 |
Commodity contracts not subject to rate recovery | [1] | 0 | 13 |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Interest rate and foreign exchange instruments | [1] | 0 | |
Commodity contracts not subject to rate recovery | [1] | 208 | 245 |
Associated offsetting commodity contracts not subject to rate recovery | [1] | (199) | (232) |
Associated cash collateral commodity contracts not subject to rate recovery | [1] | 0 | (6) |
Commodity contracts subject to rate recovery | [1] | 18 | 28 |
Associated cash collateral commodity contracts subject to rate recovery | [1] | 0 | 0 |
Associated offsetting commodity contracts subject to rate recovery | [1] | (4) | (2) |
Net amount presented on balance sheet | [1] | 24 | 50 |
Additional margin posted for commodity contracts not subject to rate recovery | [1] | 14 | 2 |
Additional margin posted for commodity contracts subject to rate recovery | [1] | 27 | 28 |
Total | [1],[3] | 65 | 80 |
Other Current Assets [Member] | San Diego Gas and Electric Company [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [1],[2] | 0 | 0 |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | [1] | 0 | |
Associated cash collateral commodity contracts not subject to rate recovery | [1] | 0 | |
Commodity contracts subject to rate recovery | [1] | 16 | 27 |
Associated cash collateral commodity contracts subject to rate recovery | [1] | 0 | 0 |
Associated offsetting commodity contracts subject to rate recovery | [1] | (3) | (2) |
Net amount presented on balance sheet | [1] | 13 | 25 |
Additional margin posted for commodity contracts not subject to rate recovery | [1] | 1 | |
Additional margin posted for commodity contracts subject to rate recovery | [1] | 26 | 27 |
Total | [1],[3] | 39 | 53 |
Other Current Assets [Member] | Southern California Gas Company [Member] | |||
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | [1] | 0 | 0 |
Associated cash collateral commodity contracts not subject to rate recovery | [1] | 0 | 0 |
Commodity contracts subject to rate recovery | [1] | 2 | 1 |
Associated cash collateral commodity contracts subject to rate recovery | [1] | 0 | |
Associated offsetting commodity contracts subject to rate recovery | [1] | (1) | |
Net amount presented on balance sheet | [1] | 1 | 1 |
Additional margin posted for commodity contracts not subject to rate recovery | [1] | 1 | |
Additional margin posted for commodity contracts subject to rate recovery | [1] | 1 | 1 |
Total | [1] | 3 | 2 |
Other Noncurrent Assets [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [2] | 0 | 1 |
Commodity contracts not subject to rate recovery | 0 | 0 | |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Interest rate and foreign exchange instruments | 0 | ||
Commodity contracts not subject to rate recovery | 22 | 32 | |
Associated offsetting commodity contracts not subject to rate recovery | (13) | (20) | |
Associated cash collateral commodity contracts not subject to rate recovery | 0 | 0 | |
Commodity contracts subject to rate recovery | 52 | 49 | |
Associated cash collateral commodity contracts subject to rate recovery | 0 | 0 | |
Associated offsetting commodity contracts subject to rate recovery | (2) | (2) | |
Net amount presented on balance sheet | 59 | 60 | |
Additional margin posted for commodity contracts not subject to rate recovery | 0 | 0 | |
Additional margin posted for commodity contracts subject to rate recovery | 0 | 0 | |
Total | [3] | 59 | 60 |
Other Noncurrent Assets [Member] | San Diego Gas and Electric Company [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [2] | 0 | 0 |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | 0 | ||
Associated cash collateral commodity contracts not subject to rate recovery | 0 | ||
Commodity contracts subject to rate recovery | 52 | 49 | |
Associated cash collateral commodity contracts subject to rate recovery | 0 | 0 | |
Associated offsetting commodity contracts subject to rate recovery | (2) | (2) | |
Net amount presented on balance sheet | 50 | 47 | |
Additional margin posted for commodity contracts not subject to rate recovery | 0 | ||
Additional margin posted for commodity contracts subject to rate recovery | 0 | 0 | |
Total | [3] | 50 | 47 |
Other Noncurrent Assets [Member] | Southern California Gas Company [Member] | |||
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | 0 | 0 | |
Associated cash collateral commodity contracts not subject to rate recovery | 0 | 0 | |
Commodity contracts subject to rate recovery | 0 | 0 | |
Associated cash collateral commodity contracts subject to rate recovery | 0 | ||
Associated offsetting commodity contracts subject to rate recovery | 0 | ||
Net amount presented on balance sheet | 0 | 0 | |
Additional margin posted for commodity contracts not subject to rate recovery | 0 | ||
Additional margin posted for commodity contracts subject to rate recovery | 0 | 0 | |
Total | 0 | 0 | |
Other Current Liabilities [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [2],[4] | (15) | (15) |
Commodity contracts not subject to rate recovery | [4] | (5) | 0 |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Interest rate and foreign exchange instruments | [4] | (12) | |
Commodity contracts not subject to rate recovery | [4] | (227) | (239) |
Associated offsetting commodity contracts not subject to rate recovery | [4] | 199 | 232 |
Associated cash collateral commodity contracts not subject to rate recovery | [4] | 30 | 4 |
Commodity contracts subject to rate recovery | [4] | (35) | (61) |
Associated cash collateral commodity contracts subject to rate recovery | [4] | 13 | 28 |
Associated offsetting commodity contracts subject to rate recovery | [4] | 4 | 2 |
Net amount presented on balance sheet | [4] | (48) | (49) |
Additional margin posted for commodity contracts not subject to rate recovery | [4] | 0 | 0 |
Additional margin posted for commodity contracts subject to rate recovery | [4] | 0 | 0 |
Total | [3],[4] | (48) | (49) |
Other Current Liabilities [Member] | San Diego Gas and Electric Company [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [2],[4] | (14) | (14) |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | [4] | (1) | |
Associated cash collateral commodity contracts not subject to rate recovery | [4] | 1 | |
Commodity contracts subject to rate recovery | [4] | (32) | (60) |
Associated cash collateral commodity contracts subject to rate recovery | [4] | 12 | 28 |
Associated offsetting commodity contracts subject to rate recovery | [4] | 3 | 2 |
Net amount presented on balance sheet | [4] | (31) | (44) |
Additional margin posted for commodity contracts not subject to rate recovery | [4] | 0 | |
Additional margin posted for commodity contracts subject to rate recovery | [4] | 0 | 0 |
Total | [3],[4] | (31) | (44) |
Other Current Liabilities [Member] | Southern California Gas Company [Member] | |||
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | [4] | (1) | (1) |
Associated cash collateral commodity contracts not subject to rate recovery | [4] | 1 | 1 |
Commodity contracts subject to rate recovery | [4] | (3) | (1) |
Associated cash collateral commodity contracts subject to rate recovery | [4] | 1 | |
Associated offsetting commodity contracts subject to rate recovery | [4] | 1 | |
Net amount presented on balance sheet | [4] | (1) | (1) |
Additional margin posted for commodity contracts not subject to rate recovery | [4] | 0 | |
Additional margin posted for commodity contracts subject to rate recovery | [4] | 0 | 0 |
Total | [4] | (1) | (1) |
Other Noncurrent Liabilities [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [2] | (184) | (156) |
Commodity contracts not subject to rate recovery | 0 | 0 | |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Interest rate and foreign exchange instruments | 0 | ||
Commodity contracts not subject to rate recovery | (17) | (21) | |
Associated offsetting commodity contracts not subject to rate recovery | 13 | 20 | |
Associated cash collateral commodity contracts not subject to rate recovery | 1 | 0 | |
Commodity contracts subject to rate recovery | (48) | (64) | |
Associated cash collateral commodity contracts subject to rate recovery | 15 | 26 | |
Associated offsetting commodity contracts subject to rate recovery | 2 | 2 | |
Net amount presented on balance sheet | (218) | (193) | |
Additional margin posted for commodity contracts not subject to rate recovery | 0 | 0 | |
Additional margin posted for commodity contracts subject to rate recovery | 0 | 0 | |
Total | [3] | (218) | (193) |
Other Noncurrent Liabilities [Member] | San Diego Gas and Electric Company [Member] | |||
Derivative Instruments in Hedges, at Fair Value, Net [Abstract] | |||
Interest rate and foreign exchange instruments | [2] | (23) | (23) |
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | 0 | ||
Associated cash collateral commodity contracts not subject to rate recovery | 0 | ||
Commodity contracts subject to rate recovery | (48) | (64) | |
Associated cash collateral commodity contracts subject to rate recovery | 15 | 26 | |
Associated offsetting commodity contracts subject to rate recovery | 2 | 2 | |
Net amount presented on balance sheet | (54) | (59) | |
Additional margin posted for commodity contracts not subject to rate recovery | 0 | ||
Additional margin posted for commodity contracts subject to rate recovery | 0 | 0 | |
Total | [3] | (54) | (59) |
Other Noncurrent Liabilities [Member] | Southern California Gas Company [Member] | |||
Other Derivatives Not Designated as Hedging Instruments at Fair Value, Net, Total [Abstract] | |||
Commodity contracts not subject to rate recovery | 0 | 0 | |
Associated cash collateral commodity contracts not subject to rate recovery | 0 | 0 | |
Commodity contracts subject to rate recovery | 0 | 0 | |
Associated cash collateral commodity contracts subject to rate recovery | 0 | ||
Associated offsetting commodity contracts subject to rate recovery | 0 | ||
Net amount presented on balance sheet | 0 | 0 | |
Additional margin posted for commodity contracts not subject to rate recovery | 0 | ||
Additional margin posted for commodity contracts subject to rate recovery | 0 | 0 | |
Total | $ 0 | $ 0 | |
[1] | Included in Current Assets: Other for SoCalGas. | ||
[2] | Includes Otay Mesa VIE. All of SDG&E’s amounts relate to Otay Mesa VIE. | ||
[3] | Normal purchase contracts previously measured at fair value are excluded. | ||
[4] | Included in Current Liabilities: Other for SoCalGas. |
DERIVATIVE IMPACT ON THE INCOME
DERIVATIVE IMPACT ON THE INCOME STATEMENT (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | ||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | $ (41) | $ 0 | |||
San Diego Gas and Electric Company [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | 1 | 2 | |||
Cash Flow Hedges | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | [1] | $ (10) | $ (6) | (11) | (8) |
Amount of pretax gain (loss) on derivative recognized in OCI (effective portion) | [1] | (89) | 96 | (254) | (1) |
Cash Flow Hedge Ineffectiveness | 0 | 0 | |||
Cash Flow Hedges | Interest Expense | Interest Rate Instruments | San Diego Gas and Electric Company [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | [1],[2] | (3) | (3) | (6) | (6) |
Amount of pretax gain (loss) on derivative recognized in OCI (effective portion) | [1],[2] | (2) | 0 | (7) | (5) |
Cash Flow Hedges | Interest Expense | Interest Rate And Foreign Exchange Instruments [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | [2] | (3) | (3) | (7) | (9) |
Amount of pretax gain (loss) on derivative recognized in OCI (effective portion) | [2] | 1 | 6 | (10) | (12) |
Cash Flow Hedges | Equity Earnings Before Income Tax [Member] | Interest Rate Instruments | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | (2) | (3) | (5) | (6) | |
Amount of pretax gain (loss) on derivative recognized in OCI (effective portion) | (70) | 89 | (207) | 11 | |
Cash Flow Hedges | Equity Earnings Net Of Income Tax [Member] | Interest Rate And Foreign Exchange Instruments [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | (5) | 0 | (6) | 0 | |
Amount of pretax gain (loss) on derivative recognized in OCI (effective portion) | (15) | 0 | (33) | 0 | |
Cash Flow Hedges | Revenues: Energy-Related Business [Member] | Commodity Contracts Not Subject To Rate Recovery | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | 0 | 0 | 7 | 7 | |
Amount of pretax gain (loss) on derivative recognized in OCI (effective portion) | (5) | 1 | (4) | 0 | |
Fair Value Hedges | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | [3] | (1) | (1) | 1 | 2 |
Fair Value Hedges | Interest Expense | Interest Rate Instruments | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | 1 | 2 | 3 | 4 | |
Fair Value Hedge Ineffectiveness | 0 | 0 | |||
Fair Value Hedges | Other Income, Net | Interest Rate Instruments | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | (2) | (3) | (2) | (2) | |
Undesignated Derivatives | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | 1 | (46) | (12) | (63) | |
Undesignated Derivatives | Southern California Gas Company [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | (1) | 1 | (2) | 2 | |
Undesignated Derivatives | Other Income, Net | Foreign Exchange Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | (15) | (3) | (12) | (3) | |
Undesignated Derivatives | Equity Earnings Net Of Income Tax [Member] | Foreign Exchange Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | 0 | 0 | 2 | (1) | |
Undesignated Derivatives | Revenues: Energy-Related Business [Member] | Commodity Contracts Not Subject To Rate Recovery | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | (24) | 9 | (29) | 12 | |
Undesignated Derivatives | Cost of Electric Fuel and Purchased Power [Member] | Commodity Contracts Subject To Rate Recovery [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | 40 | (53) | 28 | (73) | |
Undesignated Derivatives | Cost of Electric Fuel and Purchased Power [Member] | Commodity Contracts Subject To Rate Recovery [Member] | San Diego Gas and Electric Company [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | 40 | (53) | 28 | (73) | |
Undesignated Derivatives | Other Operation And Maintenance [Member] | Commodity Contracts Not Subject To Rate Recovery | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | 1 | 1 | 1 | 1 | |
Undesignated Derivatives | Other Operation And Maintenance [Member] | Commodity Contracts Not Subject To Rate Recovery | Southern California Gas Company [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) on derivative recognized in earnings | 0 | 1 | 0 | 1 | |
Undesignated Derivatives | Cost of Natural Gas [Member] | Commodity Contracts Subject To Rate Recovery [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | (1) | 0 | (2) | 1 | |
Undesignated Derivatives | Cost of Natural Gas [Member] | Commodity Contracts Subject To Rate Recovery [Member] | Southern California Gas Company [Member] | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Gain (loss) reclassified from AOCI into earnings (effective portion) | $ (1) | $ 0 | $ (2) | $ 1 | |
[1] | Amounts include negligible hedge ineffectiveness in the three months and six months ended June 30, 2016 and 2015. | ||||
[2] | Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE. | ||||
[3] | There was no hedge ineffectiveness in either the three months or six months ended June 30, 2016 or 2015. All other changes in the fair value of the interest rate swap agreements are exactly offset by changes in the fair value of the underlying long-term debt and are recorded in Other Income, Net. |
DERIVATIVE INSTRUMENTS - CASH F
DERIVATIVE INSTRUMENTS - CASH FLOW HEDGES (Details) $ in Millions | 3 Months Ended |
Jun. 30, 2016USD ($) | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ 23 |
Maximum Length Of Time Hedged In Interest Rate Cash Flow Hedge 1 | 13 years |
Joint Venture Maximum Length Of Time Hedged In Cash Flow Hedge | 19 years |
Cash Flow Hedge Gain (Loss) To Be Reclassified Within Twelve Months For Noncontrolling Interest | $ 13 |
San Diego Gas and Electric Company [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Maximum Length Of Time Hedged In Interest Rate Cash Flow Hedge 1 | 3 years |
Cash Flow Hedge Gain (Loss) To Be Reclassified Within Twelve Months For Noncontrolling Interest | $ 13 |
Southern California Gas Company [Member] | |
Derivative Instruments, Gain (Loss) [Line Items] | |
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ 0 |
DERIVATIVE INSTRUMENTS WITH CON
DERIVATIVE INSTRUMENTS WITH CONTINGENT FEATURES (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 |
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative, Net Liability Position, Aggregate Fair Value | $ 6 | $ 6 |
Additional Collateral Aggregate Fair Value | 8 | |
San Diego Gas and Electric Company [Member] | ||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Derivative, Net Liability Position, Aggregate Fair Value | 2 | $ 5 |
Additional Collateral Aggregate Fair Value | $ 4 |
FAIR VALUE MEASUREMENTS - RECUR
FAIR VALUE MEASUREMENTS - RECURRING FAIR VALUE MEASURES (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | |
Nuclear Decommisioning Trusts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Nuclear decommissioning trusts - equity securities | $ 632 | $ 619 | |
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 104 | 91 | |
Nuclear decommissioning trusts - Municipal bonds | 163 | 156 | |
Nuclear decommissioning trusts - Other securities | 192 | 182 | |
Nuclear decommissioning trusts - Total debt securities | 459 | 429 | |
Total nuclear decommissioning trusts | [1] | 1,091 | 1,048 |
Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 1 | 5 | |
Commodity contracts not subject to rate recovery, assets | 32 | 34 | |
Commodity contracts subject to rate recovery, assets | 91 | 101 | |
Total | 1,215 | 1,188 | |
Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 211 | 171 | |
Commodity contracts not subject to rate recovery, liabilities | 6 | 4 | |
Commodity contracts subject to rate recovery, liabilities | 49 | 67 | |
Total | 266 | 242 | |
San Diego Gas and Electric Company [Member] | Nuclear Decommisioning Trusts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Nuclear decommissioning trusts - equity securities | 632 | 619 | |
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 104 | 91 | |
Nuclear decommissioning trusts - Municipal bonds | 163 | 156 | |
Nuclear decommissioning trusts - Other securities | 192 | 182 | |
Nuclear decommissioning trusts - Total debt securities | 459 | 429 | |
Total nuclear decommissioning trusts | [1] | 1,091 | 1,048 |
San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 1 | ||
Commodity contracts subject to rate recovery, assets | 89 | 99 | |
Total | 1,180 | 1,148 | |
San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate instruments | 37 | 37 | |
Commodity contracts not subject to rate recovery, liabilities | 0 | ||
Commodity contracts subject to rate recovery, liabilities | 48 | 66 | |
Total | 85 | 103 | |
Southern California Gas Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 1 | ||
Commodity contracts subject to rate recovery, assets | 2 | 2 | |
Total | 3 | 2 | |
Southern California Gas Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, liabilities | 0 | 0 | |
Commodity contracts subject to rate recovery, liabilities | 1 | 1 | |
Total | 1 | 1 | |
Level 1 | Nuclear Decommisioning Trusts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Nuclear decommissioning trusts - equity securities | 632 | 619 | |
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 52 | 47 | |
Nuclear decommissioning trusts - Municipal bonds | 0 | 0 | |
Nuclear decommissioning trusts - Other securities | 0 | 0 | |
Nuclear decommissioning trusts - Total debt securities | 52 | 47 | |
Total nuclear decommissioning trusts | [1] | 684 | 666 |
Level 1 | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 0 | 0 | |
Commodity contracts not subject to rate recovery, assets | 1 | 22 | |
Commodity contracts subject to rate recovery, assets | 0 | 0 | |
Total | 685 | 688 | |
Level 1 | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 0 | 0 | |
Commodity contracts not subject to rate recovery, liabilities | 32 | 5 | |
Commodity contracts subject to rate recovery, liabilities | 1 | 0 | |
Total | 33 | 5 | |
Level 1 | San Diego Gas and Electric Company [Member] | Nuclear Decommisioning Trusts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Nuclear decommissioning trusts - equity securities | 632 | 619 | |
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 52 | 47 | |
Nuclear decommissioning trusts - Municipal bonds | 0 | 0 | |
Nuclear decommissioning trusts - Other securities | 0 | 0 | |
Nuclear decommissioning trusts - Total debt securities | 52 | 47 | |
Total nuclear decommissioning trusts | [1] | 684 | 666 |
Level 1 | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 0 | ||
Commodity contracts subject to rate recovery, assets | 0 | 0 | |
Total | 684 | 666 | |
Level 1 | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate instruments | 0 | 0 | |
Commodity contracts not subject to rate recovery, liabilities | 1 | ||
Commodity contracts subject to rate recovery, liabilities | 0 | 0 | |
Total | 0 | 1 | |
Level 1 | Southern California Gas Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 0 | ||
Commodity contracts subject to rate recovery, assets | 0 | 0 | |
Total | 0 | 0 | |
Level 1 | Southern California Gas Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, liabilities | 1 | 1 | |
Commodity contracts subject to rate recovery, liabilities | 1 | 0 | |
Total | 2 | 1 | |
Level 2 | Nuclear Decommisioning Trusts [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 | 52 | 44 | |
Nuclear decommissioning trusts - Municipal bonds | 163 | 156 | |
Nuclear decommissioning trusts - Other securities | 192 | 182 | |
Nuclear decommissioning trusts - Total debt securities | 407 | 382 | |
Total nuclear decommissioning trusts | [1] | 407 | 382 |
Level 2 | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 1 | 5 | |
Commodity contracts not subject to rate recovery, assets | 17 | 16 | |
Commodity contracts subject to rate recovery, assets | 1 | 1 | |
Total | 426 | 404 | |
Level 2 | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 211 | 171 | |
Commodity contracts not subject to rate recovery, liabilities | 5 | 3 | |
Commodity contracts subject to rate recovery, liabilities | 37 | 68 | |
Total | 253 | 242 | |
Level 2 | San Diego Gas and Electric Company [Member] | Nuclear Decommisioning Trusts [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 | 52 | 44 | |
Nuclear decommissioning trusts - Municipal bonds | 163 | 156 | |
Nuclear decommissioning trusts - Other securities | 192 | 182 | |
Nuclear decommissioning trusts - Total debt securities | 407 | 382 | |
Total nuclear decommissioning trusts | [1] | 407 | 382 |
Level 2 | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 0 | ||
Commodity contracts subject to rate recovery, assets | 0 | 0 | |
Total | 407 | 382 | |
Level 2 | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate instruments | 37 | 37 | |
Commodity contracts not subject to rate recovery, liabilities | 0 | ||
Commodity contracts subject to rate recovery, liabilities | 36 | 67 | |
Total | 73 | 104 | |
Level 2 | Southern California Gas Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 0 | ||
Commodity contracts subject to rate recovery, assets | 1 | 1 | |
Total | 1 | 1 | |
Level 2 | Southern California Gas Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, liabilities | 0 | 0 | |
Commodity contracts subject to rate recovery, liabilities | 1 | 1 | |
Total | 1 | 1 | |
Level 3 | Nuclear Decommisioning Trusts [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 | [1] | 0 | 0 |
Level 3 | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 0 | 0 | |
Commodity contracts not subject to rate recovery, assets | 0 | 0 | |
Commodity contracts subject to rate recovery, assets | 63 | 72 | |
Total | 63 | 72 | |
Level 3 | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | 0 | 0 | |
Commodity contracts not subject to rate recovery, liabilities | 0 | 0 | |
Commodity contracts subject to rate recovery, liabilities | 39 | 53 | |
Total | 39 | 53 | |
Level 3 | San Diego Gas and Electric Company [Member] | Nuclear Decommisioning Trusts [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 | [1] | 0 | 0 |
Level 3 | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 0 | ||
Commodity contracts subject to rate recovery, assets | 63 | 72 | |
Total | 63 | 72 | |
Level 3 | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate instruments | 0 | 0 | |
Commodity contracts not subject to rate recovery, liabilities | 0 | ||
Commodity contracts subject to rate recovery, liabilities | 39 | 53 | |
Total | 39 | 53 | |
Level 3 | Southern California Gas Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | 0 | ||
Commodity contracts subject to rate recovery, assets | 0 | 0 | |
Total | 0 | 0 | |
Level 3 | Southern California Gas Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, liabilities | 0 | 0 | |
Commodity contracts subject to rate recovery, liabilities | 0 | 0 | |
Total | 0 | 0 | |
Netting | Nuclear Decommisioning Trusts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Nuclear decommissioning trusts - equity securities | [2] | 0 | 0 |
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | [2] | 0 | 0 |
Nuclear decommissioning trusts - Municipal bonds | [2] | 0 | 0 |
Nuclear decommissioning trusts - Other securities | [2] | 0 | 0 |
Nuclear decommissioning trusts - Total debt securities | [2] | 0 | 0 |
Total nuclear decommissioning trusts | [1],[2] | 0 | 0 |
Netting | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | [2] | 0 | 0 |
Commodity contracts not subject to rate recovery, assets | [2] | 14 | (4) |
Commodity contracts subject to rate recovery, assets | [2] | 27 | 28 |
Total | [2] | 41 | 24 |
Netting | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate and foreign exchange instruments | [2] | 0 | 0 |
Commodity contracts not subject to rate recovery, liabilities | [2] | 31 | 4 |
Commodity contracts subject to rate recovery, liabilities | [2] | 28 | 54 |
Total | [2] | 59 | 58 |
Netting | San Diego Gas and Electric Company [Member] | Nuclear Decommisioning Trusts [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Nuclear decommissioning trusts - equity securities | [2] | 0 | 0 |
Nuclear decommissioning trusts - Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | [2] | 0 | 0 |
Nuclear decommissioning trusts - Municipal bonds | [2] | 0 | 0 |
Nuclear decommissioning trusts - Other securities | [2] | 0 | 0 |
Nuclear decommissioning trusts - Total debt securities | [2] | 0 | 0 |
Total nuclear decommissioning trusts | [1],[2] | 0 | 0 |
Netting | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | [2] | 1 | |
Commodity contracts subject to rate recovery, assets | [2] | 26 | 27 |
Total | [2] | 26 | 28 |
Netting | San Diego Gas and Electric Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Interest rate instruments | [2] | 0 | 0 |
Commodity contracts not subject to rate recovery, liabilities | [2] | 1 | |
Commodity contracts subject to rate recovery, liabilities | [2] | 27 | 54 |
Total | [2] | 27 | 55 |
Netting | Southern California Gas Company [Member] | Derivative Financial Instruments Assets [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, assets | [2] | 1 | |
Commodity contracts subject to rate recovery, assets | [2] | 1 | 1 |
Total | [2] | 2 | 1 |
Netting | Southern California Gas Company [Member] | Derivative Financial Instruments Liabilities [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Commodity contracts not subject to rate recovery, liabilities | [2] | 1 | 1 |
Commodity contracts subject to rate recovery, liabilities | [2] | 1 | 0 |
Total | [2] | $ 2 | $ 1 |
[1] | Excludes cash balances and cash equivalents. | ||
[2] | 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. |
FAIR VALUE MEASUREMENTS - RECON
FAIR VALUE MEASUREMENTS - RECON OF LEVEL 3 ASSETS (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||||
Balance at beginning of period | $ 11,000,000 | $ 102,000,000 | $ 19,000,000 | $ 107,000,000 | ||
Realized and unrealized gains (losses) | 8,000,000 | (60,000,000) | 7,000,000 | (54,000,000) | ||
Allocated transmission instruments | 0 | 1,000,000 | 0 | 1,000,000 | ||
Settlements | 5,000,000 | (1,000,000) | (2,000,000) | (12,000,000) | ||
Balance at end of period | 24,000,000 | 42,000,000 | 24,000,000 | 42,000,000 | ||
Change in unrealized gains relating to instruments still held at the end of the period | 9,000,000 | $ 45,000,000 | 9,000,000 | $ 46,000,000 | ||
Maximum [Member] | ||||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||||
Congestion Revenue Rights | $ 10 | $ 8 | ||||
Market Electricity Forward Price Inputs | 62.71 | 62.71 | ||||
Minimum [Member] | ||||||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||||
Congestion Revenue Rights | $ (24) | $ (16) | ||||
Market Electricity Forward Price Inputs | $ 21.55 | $ 21.55 |
FAIR VALUE MEASUREMENTS - FINAN
FAIR VALUE MEASUREMENTS - FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | |
Carrying Amount | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [1],[2] | $ 13,811 | $ 13,761 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 20 | 20 | |
Due from affiliate, noncurrent, Fair Value Disclosure | [3] | 179 | 175 |
Accumulated Interest Outstanding | 13 | 11 | |
Unamortized Discount and Debt Issuance Costs | 111 | 107 | |
Build-To-Suit and Capital Lease Obligations | 385 | 387 | |
Carrying Amount | Otay Mesa Energy Center Loan Payable Currently Through April 2019 Member [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Debt Instrument Carrying Amount | 310 | 315 | |
Carrying Amount | San Diego Gas and Electric Company [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [2],[4] | 4,677 | 4,304 |
Capital Lease Obligations | 242 | 244 | |
Unamortized Discount and Debt Issuance Costs | 47 | 43 | |
Carrying Amount | Southern California Gas Company [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [5] | 3,009 | 2,513 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 22 | 22 | |
Capital Lease Obligations | 1 | 1 | |
Unamortized Discount and Debt Issuance Costs | 28 | 24 | |
Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [1],[2] | 15,505 | 14,633 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 25 | 23 | |
Due from affiliate, noncurrent, Fair Value Disclosure | [3] | 171 | 166 |
Fair Value | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [1],[2] | 0 | 0 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 0 | 0 | |
Due from affiliate, noncurrent, Fair Value Disclosure | [3] | 0 | 0 |
Fair Value | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [1],[2] | 14,933 | 13,985 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 25 | 23 | |
Due from affiliate, noncurrent, Fair Value Disclosure | [3] | 94 | 97 |
Fair Value | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [1],[2] | 572 | 648 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 0 | 0 | |
Due from affiliate, noncurrent, Fair Value Disclosure | [3] | 77 | 69 |
Fair Value | San Diego Gas and Electric Company [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [2],[4] | 5,365 | 4,670 |
Fair Value | San Diego Gas and Electric Company [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [2],[4] | 0 | 0 |
Fair Value | San Diego Gas and Electric Company [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [2],[4] | 5,055 | 4,355 |
Fair Value | San Diego Gas and Electric Company [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [2],[4] | 310 | 315 |
Fair Value | Southern California Gas Company [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [5] | 3,335 | 2,621 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 27 | 25 | |
Fair Value | Southern California Gas Company [Member] | Fair Value, Inputs, Level 1 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [5] | 0 | 0 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 0 | 0 | |
Fair Value | Southern California Gas Company [Member] | Fair Value, Inputs, Level 2 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [5] | 3,335 | 2,621 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | 27 | 25 | |
Fair Value | Southern California Gas Company [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Fair value of financial instruments, Total long-term debt | [5] | 0 | 0 |
Preferred Stock Of Subsidiaries Fair Value Disclosure | $ 0 | $ 0 | |
[1] | Before reductions for unamortized discount (net of premium) and debt issuance costs of $111 million and $107 million at June 30, 2016 and December 31, 2015, respectively, and excluding build-to-suit and capital lease obligations of $385 million and $387 million at June 30, 2016 and December 31, 2015, respectively. We discuss our long-term debt in Note 6 above and in Note 5 of the Notes to Consolidated Financial Statements in the Annual Report. | ||
[2] | Level 3 instruments include $310 million and $315 million at June 30, 2016 and December 31, 2015, respectively, related to Otay Mesa VIE. | ||
[3] | Excluding accumulated interest outstanding of $13 million and $11 million at June 30, 2016 and December 31, 2015, respectively. | ||
[4] | Before reductions for unamortized discount and debt issuance costs of $47 million and $43 million at June 30, 2016 and December 31, 2015, respectively, and excluding capital lease obligations of $242 million and $244 million at June 30, 2016 and December 31, 2015, respectively. | ||
[5] | Before reductions for unamortized discount and debt issuance costs of $28 million and $24 million at June 30, 2016 and December 31, 2015, respectively, and excluding capital lease obligations of $1 million both at June 30, 2016 and December 31, 2015. |
FAIR VALUE MEASUREMENTS - NONRE
FAIR VALUE MEASUREMENTS - NONRECURRING INPUTS (Details) - Rockies Express [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |
Mar. 31, 2016 | Jun. 30, 2016 | Mar. 29, 2016 | |
Fair Value Inputs Assets Quantitative Information [Line Items] | |||
Equity Method Investment Ownership Percentage | 25.00% | ||
Proceeds From Sale Of Equity Method Investments | $ 440 | $ 443 | |
Equity Method Investment, Other than Temporary Impairment | 44 | ||
Equity Method Investment Other Than Temporary Impairment Net Of Tax Benefit | $ 27 | ||
Investments In Affiliates Subsidiaries Associates And Joint Ventures Fair Value Disclosure | $ 440 | ||
Market Approach Valuation Technique [Member] | Fair Value, Inputs, Level 2 [Member] | One Hundred Percent [Member] | |||
Fair Value Inputs Assets Quantitative Information [Line Items] | |||
Investments In Affiliates Subsidiaries Associates And Joint Ventures Fair Value Disclosure | $ 440 |
NUCLEAR PLANT - INVESTMENT (Det
NUCLEAR PLANT - INVESTMENT (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 18 Months Ended | |||
Jun. 30, 2016 | Jun. 30, 2015 | Mar. 31, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | |
Nuclear Plant Investment [Line Items] | ||||||
Loss From Plant Closure, Pretax | $ 0 | $ 0 | $ 0 | $ (21) | ||
Loss (Adjustment) From Plant Closure, After Tax | $ (13) | |||||
Loss from plant closure, after-tax (cumulative) | $ 125 | |||||
Nuclear Plant, Ownership Percentage | 20.00% | 20.00% | 20.00% | |||
San Diego Gas and Electric Company [Member] | ||||||
Nuclear Plant Investment [Line Items] | ||||||
Utility plant closure adjustment | $ 0 | $ 0 | $ 0 | $ (21) | ||
Loss (Adjustment) From Plant Closure, After Tax | $ (13) | |||||
Loss from plant closure, after-tax (cumulative) | $ 125 | |||||
Nuclear Plant, Ownership Percentage | 20.00% | 20.00% | 20.00% |
NUCLEAR PLANT - DECOMMISSIONING
NUCLEAR PLANT - DECOMMISSIONING AND FUNDING (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2016 | Dec. 31, 2015 | [1] | |
Nuclear Plant Decommissioning And Funding [Line Items] | |||
Nuclear decommissioning trusts | $ 1,103 | $ 1,063 | |
San Diego Gas and Electric Company [Member] | |||
Nuclear Plant Decommissioning And Funding [Line Items] | |||
Nuclear decommissioning trusts | 1,103 | $ 1,063 | |
Year 2013-2016 [Member] | |||
Nuclear Plant Decommissioning And Funding [Line Items] | |||
Authorized Recovery Amount, Nuclear Decommissioning Trust Funding | 218 | ||
Amount Pending IRS Clarification | 75 | ||
Year 2013-2016 [Member] | San Diego Gas and Electric Company [Member] | |||
Nuclear Plant Decommissioning And Funding [Line Items] | |||
Authorized Recovery Amount, Nuclear Decommissioning Trust Funding | 218 | ||
Amount Pending IRS Clarification | $ 75 | ||
[1] | Derived from audited financial statements. |
NUCLEAR PLANT - REGULATORY ASSE
NUCLEAR PLANT - REGULATORY ASSET (Details) - USD ($) $ in Millions | Jun. 30, 2016 | Dec. 31, 2015 | [1] |
Regulatory Asset [Line Items] | |||
Regulatory Assets, Noncurrent | $ 3,353 | $ 3,273 | |
San Diego Gas and Electric Company [Member] | |||
Regulatory Asset [Line Items] | |||
Regulatory Assets Current | 93 | 107 | |
Regulatory Assets, Noncurrent | 933 | 977 | |
Southern California Gas Company [Member] | |||
Regulatory Asset [Line Items] | |||
Regulatory Assets Current | 8 | 7 | |
Regulatory Assets, Noncurrent | 717 | $ 636 | |
Nuclear Plant Closure [Member] | |||
Regulatory Asset [Line Items] | |||
Regulatory Asset, Nuclear Plant Closure | 206 | ||
Regulatory Assets Current | 45 | ||
Regulatory Assets, Noncurrent | 161 | ||
Nuclear Plant Closure [Member] | San Diego Gas and Electric Company [Member] | |||
Regulatory Asset [Line Items] | |||
Regulatory Asset, Nuclear Plant Closure | 206 | ||
Regulatory Assets Current | 45 | ||
Regulatory Assets, Noncurrent | $ 161 | ||
[1] | Derived from audited financial statements. |
NUCLEAR PLANT - COST STUDY (Det
NUCLEAR PLANT - COST STUDY (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
SDG&E Ownership [Member] | |
Environmental Exit Cost [Line Items] | |
Total Estimated Nuclear Decommissioning Costs, Latest Cost Study | $ 899 |
SDG&E Ownership [Member] | San Diego Gas and Electric Company [Member] | |
Environmental Exit Cost [Line Items] | |
Total Estimated Nuclear Decommissioning Costs, Latest Cost Study | 899 |
Total Ownership [Member] | |
Environmental Exit Cost [Line Items] | |
Total Estimated Nuclear Decommissioning Costs, Latest Cost Study | 4,411 |
Total Ownership [Member] | San Diego Gas and Electric Company [Member] | |
Environmental Exit Cost [Line Items] | |
Total Estimated Nuclear Decommissioning Costs, Latest Cost Study | $ 4,411 |
NUCLEAR PLANT - SETTLEMENT (Det
NUCLEAR PLANT - SETTLEMENT (Details) $ in Millions | 3 Months Ended |
Dec. 31, 2015USD ($) | |
To SDGE [Member] | |
Nuclear Plant Insurance Settlement [Line Items] | |
Nuclear Plant Insurance Recoveries | $ 80 |
Nuclear Plant Insurance Recovery Allocation Percentage | 5.00% |
To SDGE [Member] | San Diego Gas and Electric Company [Member] | |
Nuclear Plant Insurance Settlement [Line Items] | |
Nuclear Plant Insurance Recoveries | $ 80 |
Nuclear Plant Insurance Recovery Allocation Percentage | 5.00% |
Total Ownership [Member] | |
Nuclear Plant Insurance Settlement [Line Items] | |
Nuclear Plant Insurance Recoveries | $ 400 |
Total Ownership [Member] | San Diego Gas and Electric Company [Member] | |
Nuclear Plant Insurance Settlement [Line Items] | |
Nuclear Plant Insurance Recoveries | 400 |
To Ratepayers [Member] | |
Nuclear Plant Insurance Settlement [Line Items] | |
Nuclear Plant Insurance Recoveries | 75 |
To Ratepayers [Member] | San Diego Gas and Electric Company [Member] | |
Nuclear Plant Insurance Settlement [Line Items] | |
Nuclear Plant Insurance Recoveries | $ 75 |
SONGS NDT 1 (Details)
SONGS NDT 1 (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | ||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | $ 671 | $ 671 | $ 660 | |||||
Gross Unrealized Gains | 443 | 423 | ||||||
Gross Unrealized Loss | (11) | (20) | ||||||
Estimated fair value | 1,103 | 1,103 | 1,063 | |||||
Proceeds from sales | [1] | 111 | $ 127 | 204 | $ 221 | |||
Gross realized gains | 5 | 4 | 8 | 6 | ||||
Gross realized losses | (3) | $ (3) | (11) | $ (7) | ||||
Total Debt Securities | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | 438 | 438 | 431 | |||||
Gross Unrealized Gains | 27 | 11 | ||||||
Gross Unrealized Loss | (6) | (13) | ||||||
Estimated fair value | 459 | 459 | 429 | |||||
Debt Securities Issued By The U.S. Treasury And Other U.S. Government Corporations And Agencies | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | 99 | [2] | 99 | [2] | 89 | |||
Gross Unrealized Gains | 5 | [2] | 2 | |||||
Gross Unrealized Loss | 0 | [2] | 0 | |||||
Estimated fair value | 104 | [2] | 104 | [2] | 91 | |||
Municipal Bonds | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | 150 | [3] | 150 | [3] | 148 | |||
Gross Unrealized Gains | 13 | [3] | 8 | |||||
Gross Unrealized Loss | 0 | [3] | 0 | |||||
Estimated fair value | 163 | [3] | 163 | [3] | 156 | |||
Other Debt Securities | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | 189 | [3] | 189 | [3] | 194 | |||
Gross Unrealized Gains | 9 | [3] | 1 | |||||
Gross Unrealized Loss | (6) | [3] | (13) | |||||
Estimated fair value | 192 | [3] | 192 | [3] | 182 | |||
Equity Securities | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | 221 | 221 | 214 | |||||
Gross Unrealized Gains | 416 | 412 | ||||||
Gross Unrealized Loss | (5) | (7) | ||||||
Estimated fair value | 632 | 632 | 619 | |||||
Cash And Cash Equivalents | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ||||||||
Cost | 12 | 12 | 15 | |||||
Gross Unrealized Gains | 0 | 0 | ||||||
Gross Unrealized Loss | 0 | 0 | ||||||
Estimated fair value | $ 12 | $ 12 | $ 15 | |||||
[1] | Excludes securities that are held to maturity. | |||||||
[2] | Maturity dates are 2017-2065. | |||||||
[3] | Maturity dates are 2016-2115. |
CALIFORNIA UTILITIES' REGULAT66
CALIFORNIA UTILITIES' REGULATORY MATTERS - SCHEDULE OF GENERAL RATE CASE (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2016 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
San Diego Gas and Electric Company [Member] | Year 2016 [Member] | |||||
Public Utilities General Disclosures [Line Items] | |||||
General Rate Case, Revenue Requirement | $ 1,791 | ||||
General Rate Case, Revenue Requirement, Revised Request | 1,811 | ||||
General Rate Case, Revenue Requirement Increase (Decrease), Revised Request | (20) | ||||
General Rate Case, Revenue Requirement Percentage Annual Escalation | 3.50% | 3.50% | |||
General Rate Case, Rate Base Adjustment | (55) | ||||
General Rate Case, Revenue Requirement Adjustment Due To Rate Base Adjustment | (7) | ||||
General Rate Case, Regulatory Asset Due To Retroactive Revenue | $ 23 | $ 23 | |||
General Rate Case, Regulatory Asset Due To Retroactive Revenue, Noncurrent | 8 | 8 | |||
General Rate Case, Deductible Per Event | 5 | 5 | |||
General Rate Case, Regulatory Liability | 15 | 15 | |||
San Diego Gas and Electric Company [Member] | Pre Tax [Member] | |||||
Rate Case Impacts [Line Items] | |||||
General Rate Case, Retroactive Revenue Requirement Increase From 2016 GRC | 15 | ||||
General Rate Case, Adjustment To Revenue, Refund Of 2015 Tax Memorandum Account | (37) | ||||
General Rate Case, Adjustment To Revenue, True Up Of 2012-2014 Tax Estimates | (15) | ||||
General Rate Case, Total Adjustments To Revenue Related To Tax Repairs Deductions | (52) | ||||
San Diego Gas and Electric Company [Member] | After Tax [Member] | |||||
Rate Case Impacts [Line Items] | |||||
General Rate Case, Retroactive Revenue Requirement Increase From 2016 GRC | 9 | ||||
General Rate Case, Adjustment To Revenue, Refund Of 2015 Tax Memorandum Account | (22) | ||||
General Rate Case, Adjustment To Revenue, True Up Of 2012-2014 Tax Estimates | (9) | ||||
General Rate Case, Total Adjustments To Revenue Related To Tax Repairs Deductions | (31) | ||||
Southern California Gas Company [Member] | Year 2016 [Member] | |||||
Public Utilities General Disclosures [Line Items] | |||||
General Rate Case, Revenue Requirement | 2,204 | ||||
General Rate Case, Revenue Requirement, Revised Request | 2,219 | ||||
General Rate Case, Revenue Requirement Increase (Decrease), Revised Request | (15) | ||||
General Rate Case, Revenue Requirement Percentage Annual Escalation | 3.50% | 3.50% | |||
General Rate Case, Rate Base Adjustment | (38) | ||||
General Rate Case, Revenue Requirement Adjustment Due To Rate Base Adjustment | $ (5) | ||||
General Rate Case, Regulatory Asset Due To Retroactive Revenue | 60 | 60 | |||
General Rate Case, Regulatory Asset Due To Retroactive Revenue, Noncurrent | 21 | 21 | |||
General Rate Case, Deductible Per Event | 5 | 5 | |||
General Rate Case, Regulatory Liability | 11 | 11 | |||
Southern California Gas Company [Member] | Pre Tax [Member] | |||||
Rate Case Impacts [Line Items] | |||||
General Rate Case, Earnings Charge Due To Income Tax Forecasted Incurred | 15 | 15 | |||
General Rate Case, Retroactive Revenue Requirement Increase From 2016 GRC | 20 | ||||
General Rate Case, Adjustment To Revenue, Refund Of 2015 Tax Memorandum Account | (72) | ||||
General Rate Case, Adjustment To Revenue, True Up Of 2012-2014 Tax Estimates | (11) | ||||
General Rate Case, Total Adjustments To Revenue Related To Tax Repairs Deductions | (83) | ||||
Southern California Gas Company [Member] | After Tax [Member] | |||||
Rate Case Impacts [Line Items] | |||||
General Rate Case, Earnings Charge Due To Income Tax Forecasted Incurred | 9 | $ 9 | |||
General Rate Case, Retroactive Revenue Requirement Increase From 2016 GRC | 12 | ||||
General Rate Case, Adjustment To Revenue, Refund Of 2015 Tax Memorandum Account | (43) | ||||
General Rate Case, Adjustment To Revenue, True Up Of 2012-2014 Tax Estimates | (6) | ||||
General Rate Case, Total Adjustments To Revenue Related To Tax Repairs Deductions | $ (49) |
CALIFORNIA UTILITIES' REGULAT67
CALIFORNIA UTILITIES' REGULATORY MATTERS - SCHEDULE OF UTILITY INCENTIVE AWARDS (Details) $ in Millions | Jun. 30, 2016USD ($) |
Southern California Gas Company [Member] | Year 2016 [Member] | |
Public Utilities General Disclosures [Line Items] | |
Requested Gas Cost Incentive Mechanism Award | $ 5 |
CALIFORNIA UTILITIES' REGULAT68
CALIFORNIA UTILITIES' REGULATORY MATTERS - SCHEDULE OF UTILITY PROJECTS (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2016 | Dec. 31, 2014 | Jun. 11, 2014 | |
Southern Gas System Member [Member] | Total Estimated Cost [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Impairment Charge, After Tax | $ 13,000 | ||
Impairment Charge Pre Tax | 21,000 | ||
Pipeline Safety And Reliability Project [Member] | Total Estimated Cost [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Revised Estimated Project Cost | 633,000 | ||
San Diego Gas and Electric Company [Member] | Pipeline Safety Enhancement Plan [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Pipeline Safety Plan Regulatory Account | 15,000 | ||
Recovery Requested, PSEP Costs | 100 | $ 100 | |
San Diego Gas and Electric Company [Member] | Sycamore Penasquitos Transmission Project [Member] | Minimum Range [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Estimated Project Cost | 120,000 | ||
Revised Estimated Project Cost | 250,000 | ||
San Diego Gas and Electric Company [Member] | Sycamore Penasquitos Transmission Project [Member] | Maximum Range [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Estimated Project Cost | 150,000 | ||
Revised Estimated Project Cost | 300,000 | ||
San Diego Gas and Electric Company [Member] | Pipeline Testing/Replacing 1956 to 1961 [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Disallowed Costs Impact On Earnings After Tax | 500 | ||
San Diego Gas and Electric Company [Member] | Cleveland National Forest Transmissions Projects [Member] | Total Estimated Cost [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Estimated Project Cost | 680,000 | ||
San Diego Gas and Electric Company [Member] | Cleveland National Forest Projects Distribution Level Facilities [Member] | Total Estimated Cost [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Estimated Project Cost | 210,000 | ||
San Diego Gas and Electric Company [Member] | Cleveland National Forest Projects Transmission Level Facilities [Member] | Total Estimated Cost [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Estimated Project Cost | 470,000 | ||
Southern California Gas Company [Member] | Pipeline Safety Enhancement Plan [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Disallowed Costs Impact On Earnings After Tax | $ 5,000 | ||
Pipeline Safety Plan Regulatory Account | 195,000 | ||
Recovery Requested, PSEP Costs | 26,800 | $ 46,000 | |
Southern California Gas Company [Member] | Pipeline Testing/Replacing 1956 to 1961 [Member] | |||
Schedule of Utility Projects [Line Items] | |||
Disallowed Costs Impact On Earnings After Tax | $ 3,600 |
CALIFORNIA UTILITIES' REGULAT69
CALIFORNIA UTILITIES' REGULATORY MATTERS - SCHEDULE OF WILDFIRE COST RECOVERY (Details) - San Diego Gas and Electric Company [Member] $ in Thousands | 3 Months Ended |
Jun. 30, 2016USD ($) | |
Public Utilities General Disclosures [Line Items] | |
Incurred Costs | $ 2,400,000 |
Requested Recovery | 379,000 |
Insurance Reimbursement | 1,100,000 |
Third Party Settlement Recoveries | 824,000 |
FERC Jurisdictional Rates | $ 80,000 |
Voluntary Shareholder Contribution, Percentage | 10.00% |
WEMA Balance | $ 42,000 |
FERC-Approved Wildfire Damage Expenses | $ 23,100 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - LEGAL PROCEEDINGS (Details) | Jul. 28, 2016 | Jun. 30, 2016USD ($) | Dec. 31, 2015USD ($) | [1] |
Loss Contingencies [Line Items] | ||||
Loss Contingency Accrual, at Carrying Value | $ 44,000,000 | |||
Insurance receivable for Aliso Canyon costs | 679,000,000 | $ 325,000,000 | ||
Reserve for Aliso Canyon costs | 117,000,000 | 274,000,000 | ||
San Diego Gas and Electric Company [Member] | ||||
Loss Contingencies [Line Items] | ||||
Loss Contingency Accrual, at Carrying Value | 21,000,000 | |||
Southern California Gas Company [Member] | ||||
Loss Contingencies [Line Items] | ||||
Loss Contingency Accrual, at Carrying Value | 21,000,000 | |||
Insurance receivable for Aliso Canyon costs | 679,000,000 | 325,000,000 | ||
Reserve for Aliso Canyon costs | 117,000,000 | $ 274,000,000 | ||
Wildfire [Member] | San Diego Gas and Electric Company [Member] | ||||
Loss Contingencies [Line Items] | ||||
Regulatory Assets Arising From Wildfire Litigation Costs | 355,000,000 | |||
Potential After-Tax Charge for Nonrecovery of CPUC Regulatory Assets | 210,000,000 | |||
Portion of Regulatory Assets Arising From Wildfire Litigation Related To CPUC Operations | 353,000,000 | |||
Aliso Canyon Natural Gas Storage Facility Gas Leak [Member] | Southern California Gas Company [Member] | ||||
Loss Contingencies [Line Items] | ||||
Loss Contingency Accrual, at Carrying Value | 717,000,000 | |||
Liability Insurance Coverage, Maximum | 1,000,000,000 | |||
Loss Contingency, Number Of Lawsuits | 181 | |||
Number Of Lawsuits Filed In Los Angeles County | 177 | |||
Number Of Lawsuits Filed In San Diego County | 2 | |||
Number Of Lawsuits Filed In US District Court Of Southern District Of California | 2 | |||
Civil Penalties Per Day | $ 250,000 | |||
Proportion Of Total Gas Storage Capacity, Percentage | 63.00% | |||
Net Book Value Of Aliso Canyon Facility | $ 441,000,000 | |||
Construction Work In Progress Of New Compressor Station | $ 199,000,000 | |||
Estimated Costs Related To Temporary Relocation Percentage | 70.00% | |||
Estimated Costs Related To Controlling Well And Stopping Leak And Emissions Percentage | 15.00% | |||
Insurance Proceeds | $ 34,000,000 | |||
Total Penalties | $ 60,800 | |||
[1] | Derived from audited financial statements. |
COMMITMENTS AND CONTINGENCIES71
COMMITMENTS AND CONTINGENCIES - OTHER LITIGATION (Details) £ in Millions, $ in Millions | 6 Months Ended | ||
Jun. 30, 2016USD ($) | Oct. 01, 2015GBP (£) | Oct. 01, 2014GBP (£) | |
Wind Farm [Member] | San Diego Gas and Electric Company [Member] | |||
Loss Contingencies [Line Items] | |||
Estimated Tax Equity Investment | $ 285 | ||
Ratepayer Credit | $ 39 | ||
So Cal Gas PCB Litigation [Member] | Southern California Gas Company [Member] | |||
Loss Contingencies [Line Items] | |||
Loss Contingency, Number Of Lawsuits | 7 | ||
Number of Lawsuits Settled | 6 | ||
Mobile Gas Litigation [Member] | |||
Loss Contingencies [Line Items] | |||
Loss Contingency, Number Of Lawsuits | 14 | ||
Number of Lawsuits Settled | 11 | ||
Loss Contingency Lawsuits Remaining | 3 | ||
Loss Contingency Number Of Plaintiffs | 250 | ||
Outstanding Equity Agreed To Sell, Percentage | 100.00% | ||
HMRC VAT Claim [Member] | |||
Loss Contingencies [Line Items] | |||
VAT Tax Claim Paid Upon Appeal | £ | £ 146 | £ 86 | |
Investment in RBS Sempra Commodities LLP | $ 67 |
COMMITMENTS AND CONTINGENCIES72
COMMITMENTS AND CONTINGENCIES - CONTRACTUAL COMMITMENTS (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Sempra Energy [Member] | Asset Retirement Obligation [Member] | |
Payments Under Contractual Commitments [Line Items] | |
Increase (Decrease) In Asset Retirement Obligations | $ 342 |
San Diego Gas and Electric Company [Member] | Asset Retirement Obligation [Member] | |
Payments Under Contractual Commitments [Line Items] | |
Increase (Decrease) In Asset Retirement Obligations | 26 |
Southern California Gas Company [Member] | Asset Retirement Obligation [Member] | |
Payments Under Contractual Commitments [Line Items] | |
Increase (Decrease) In Asset Retirement Obligations | 316 |
Sempra Natural Gas [Member] | Natural Gas Contracts [Member] | |
Payments Under Contractual Commitments [Line Items] | |
Increase (Decrease) In Commitment Amount | (111) |
Increase (Decrease) In Commitment Amount, Payments Due, Current | (97) |
Increase (Decrease) In Commitment Amount, Payments Due, In Two Years | 14 |
Increase (Decrease) In Commitment Amount, Payments Due, In Three Years | (8) |
Increase (Decrease) In Commitment Amount, Payments Due, In Four Years | (16) |
Increase (Decrease) In Commitment Amount, Payments Due, In Five Years | (4) |
Charges Related To Permanent Capacity Releases, Pretax | 206 |
Charges Related To Permanent Capacity Releases, After Tax | 123 |
Obligation To Make Future Capacity Payments, Current | 41 |
Obligation To Make Future Capacity Payments, Noncurrent | $ 118 |
Sempra Natural Gas [Member] | Liquefied Natural Gas Contracts [Member] | |
Payments Under Contractual Commitments [Line Items] | |
Escalation Percentage Beyond Year 2028 | 1.00% |
Increase (Decrease) In Commitment Amount, Payments Due, Current | $ (196) |
Increase (Decrease) In Commitment Amount, Payments Due, In Two Years | 61 |
Increase (Decrease) In Commitment Amount, Payments Due, In Three Years | 13 |
Increase (Decrease) In Commitment Amount, Payments Due, In Four Years | (9) |
Increase (Decrease) In Commitment Amount, Payments Due, In Five Years | (33) |
Increase (Decrease) In Commitment Amount, Payments Due, In Thereafter | $ 108 |
COMMITMENTS AND CONTINGENCIES73
COMMITMENTS AND CONTINGENCIES - NUCLEAR INSURANCE (Details) - San Diego Gas and Electric Company [Member] $ in Thousands | Jun. 30, 2016USD ($) |
Schedule Of Nuclear Insurance [Line Items] | |
Nuclear Liability Insurance Coverage, Maximum | $ 375,000 |
Secondary Financial Protection, Maximum | 13,200,000 |
Secondary Financial Protection, Company Contribution, Maximum | 50,930 |
Secondary Financial Protection, Company Contribution, Annual Maximum | 7,600 |
Nuclear Property Insurance Coverage, Maximum | 2,750,000 |
Nuclear Property Damage Insurance, Premium Assessment | 9,700 |
Nuclear Property Insurance Terrorism Coverage, Maximum | 3,240,000 |
Deductible Per Loss | $ 2,500 |
COMMITMENTS AND CONTINGENCIES74
COMMITMENTS AND CONTINGENCIES - NUCLEAR FUEL DISPOSAL (Details) - San Diego Gas and Electric Company [Member] - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Jun. 30, 2016 | Dec. 31, 2013 | |
SDG&E Ownership [Member] | ||
Jointly Owned Utility Plant Interests [Line Items] | ||
Spent Nuclear Fuel Damages Awarded, Value | $ 32 | |
Increase (Decrease) In SONGS Regulatory Asset | $ (23) | |
Increase (Decrease) In Nuclear Decommissioning Balancing Account | (8) | |
Increase (Decrease) In Operation And Maintenance Cost Balancing Account | $ (1) | |
Total Ownership [Member] | ||
Jointly Owned Utility Plant Interests [Line Items] | ||
Spent Nuclear Fuel Damages Awarded, Value | $ 162 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 2,156 | $ 2,367 | $ 4,778 | $ 5,049 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 100.00% | 100.00% | 100.00% | 100.00% | |||
Segment reporting information, Interest Expense | $ 142 | $ 139 | $ 285 | $ 273 | |||
Segment reporting information, Interest Income | 6 | 10 | 12 | 17 | |||
Segment reporting information, Depreciation and Amortization | $ 314 | $ 307 | $ 642 | $ 610 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 100.00% | 100.00% | 100.00% | 100.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ (106) | $ 98 | $ 36 | $ 261 | |||
Equity Earnings (Losses) Recorded Before Tax | 14 | 27 | (8) | 46 | |||
Segment reporting information, Equity Earnings (Losses) Recorded Net of Tax | 33 | 22 | 50 | 37 | |||
Segment reporting information, Earnings (Losses) | 16 | 295 | 335 | 732 | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 2,006 | $ 1,466 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 100.00% | 100.00% | |||||
Segment reporting information, Assets | $ 42,875 | $ 42,875 | $ 41,150 | [1] | |||
Segment reporting information, Percentage of Consolidated Assets | 100.00% | 100.00% | 100.00% | ||||
Equity Method and Other Investments | $ 2,267 | $ 2,267 | $ 2,905 | [1] | |||
S D G E Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 992 | $ 972 | $ 1,983 | $ 1,938 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 46.00% | 41.00% | 41.00% | 38.00% | |||
Segment reporting information, Interest Expense | $ 48 | $ 52 | $ 96 | $ 104 | |||
Segment reporting information, Depreciation and Amortization | $ 158 | $ 149 | $ 317 | $ 294 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 50.00% | 48.00% | 49.00% | 48.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ 48 | $ 54 | $ 120 | $ 142 | |||
Segment reporting information, Earnings (Losses) | 100 | 126 | 229 | 273 | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 602 | $ 600 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 30.00% | 41.00% | |||||
Segment reporting information, Assets | $ 17,039 | $ 17,039 | $ 16,515 | ||||
Segment reporting information, Percentage of Consolidated Assets | 40.00% | 40.00% | 40.00% | ||||
Segment Reporting Information, Intersegment Revenues | $ 0 | 3 | $ 3 | $ 5 | |||
So Cal Gas Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 617 | $ 780 | $ 1,650 | $ 1,828 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 29.00% | 33.00% | 35.00% | 36.00% | |||
Segment reporting information, Interest Expense | $ 24 | $ 19 | $ 46 | $ 38 | |||
Segment reporting information, Interest Income | 0 | 3 | 0 | 3 | |||
Segment reporting information, Depreciation and Amortization | $ 112 | $ 113 | $ 234 | $ 226 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 36.00% | 37.00% | 36.00% | 37.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ (29) | $ 16 | $ 58 | $ 111 | |||
Segment reporting information, Earnings (Losses) | [2] | (1) | 70 | 194 | 284 | ||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 650 | $ 603 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 32.00% | 41.00% | |||||
Segment reporting information, Assets | $ 13,086 | $ 13,086 | $ 12,104 | ||||
Segment reporting information, Percentage of Consolidated Assets | 30.00% | 30.00% | 29.00% | ||||
Segment Reporting Information, Intersegment Revenues | $ 18 | 17 | $ 35 | $ 36 | |||
Sempra South American Utilities Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 385 | $ 389 | $ 785 | $ 778 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 18.00% | 16.00% | 16.00% | 15.00% | |||
Segment reporting information, Interest Expense | $ 11 | $ 8 | $ 20 | $ 13 | |||
Segment reporting information, Interest Income | 5 | 5 | 10 | 9 | |||
Segment reporting information, Depreciation and Amortization | $ 14 | $ 12 | $ 27 | $ 25 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 4.00% | 4.00% | 4.00% | 4.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ 15 | $ 18 | $ 29 | $ 34 | |||
Segment reporting information, Equity Earnings (Losses) Recorded Net of Tax | 0 | 0 | 2 | (1) | |||
Segment reporting information, Earnings (Losses) | 43 | 45 | 81 | 86 | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 82 | $ 66 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 4.00% | 5.00% | |||||
Segment reporting information, Assets | $ 3,486 | $ 3,486 | $ 3,235 | ||||
Segment reporting information, Percentage of Consolidated Assets | 8.00% | 8.00% | 8.00% | ||||
Equity Method and Other Investments | $ (1) | $ (1) | $ (4) | ||||
Sempra Mexico Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 147 | $ 152 | $ 285 | $ 315 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 7.00% | 6.00% | 6.00% | 6.00% | |||
Segment reporting information, Interest Expense | $ 4 | $ 6 | $ 8 | $ 11 | |||
Segment reporting information, Interest Income | 1 | 2 | 3 | 4 | |||
Segment reporting information, Depreciation and Amortization | $ 15 | $ 17 | $ 32 | $ 34 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 5.00% | 6.00% | 5.00% | 6.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ (12) | $ 5 | $ 29 | $ 13 | |||
Segment reporting information, Equity Earnings (Losses) Recorded Net of Tax | 33 | 22 | 48 | 38 | |||
Segment reporting information, Earnings (Losses) | 57 | 50 | 74 | 97 | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 140 | $ 120 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 7.00% | 8.00% | |||||
Segment reporting information, Assets | $ 3,925 | $ 3,925 | $ 3,783 | ||||
Segment reporting information, Percentage of Consolidated Assets | 9.00% | 9.00% | 9.00% | ||||
Equity Method and Other Investments | $ 548 | $ 548 | $ 519 | ||||
Segment Reporting Information, Intersegment Revenues | 27 | 24 | 54 | $ 49 | |||
Sempra Renewables Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 6 | $ 10 | $ 13 | $ 18 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 0.00% | 1.00% | 0.00% | 1.00% | |||
Segment reporting information, Interest Expense | $ 0 | $ 1 | $ 0 | $ 2 | |||
Segment reporting information, Interest Income | 0 | 1 | 1 | 1 | |||
Segment reporting information, Depreciation and Amortization | $ 2 | $ 1 | $ 3 | $ 3 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 1.00% | 0.00% | 1.00% | 0.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ (9) | $ (11) | $ (21) | $ (28) | |||
Equity Earnings (Losses) Recorded Before Tax | 11 | 10 | 18 | 12 | |||
Segment reporting information, Earnings (Losses) | 12 | 19 | 25 | 32 | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 457 | $ 22 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 23.00% | 1.00% | |||||
Segment reporting information, Assets | $ 1,838 | $ 1,838 | $ 1,441 | ||||
Segment reporting information, Percentage of Consolidated Assets | 4.00% | 4.00% | 4.00% | ||||
Equity Method and Other Investments | $ 827 | $ 827 | $ 855 | ||||
Sempra Natural Gas Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 90 | $ 155 | $ 220 | $ 352 | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 4.00% | 7.00% | 5.00% | 7.00% | |||
Segment reporting information, Interest Expense | $ 10 | $ 23 | $ 22 | $ 44 | |||
Segment reporting information, Interest Income | 17 | 25 | 33 | 44 | |||
Segment reporting information, Depreciation and Amortization | $ 12 | $ 12 | $ 25 | $ 24 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 4.00% | 4.00% | 4.00% | 4.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ (99) | $ 27 | $ (124) | $ 29 | |||
Equity Earnings (Losses) Recorded Before Tax | 3 | 17 | (26) | 34 | |||
Segment reporting information, Earnings (Losses) | (149) | 40 | (185) | 42 | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 68 | $ 28 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 3.00% | 2.00% | |||||
Segment reporting information, Assets | $ 5,396 | $ 5,396 | $ 5,566 | ||||
Segment reporting information, Percentage of Consolidated Assets | 13.00% | 13.00% | 13.00% | ||||
Equity Method and Other Investments | $ 818 | $ 818 | $ 1,460 | ||||
Segment Reporting Information, Intersegment Revenues | 36 | 46 | 66 | $ 89 | |||
Adjustments and Eliminations [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | $ 0 | $ (1) | $ 0 | $ (1) | |||
Segment reporting information, Percentage of Total Consolidated Revenues | 0.00% | 0.00% | 0.00% | 0.00% | |||
Intercompany Eliminations Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Interest Expense | $ (29) | $ (35) | $ (53) | $ (67) | |||
Segment reporting information, Interest Income | (17) | (26) | (35) | (44) | |||
Intersegment Revenues Segment [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Revenue | [3] | $ (81) | $ (90) | $ (158) | $ (179) | ||
Segment reporting information, Percentage of Total Consolidated Revenues | [3] | (4.00%) | (4.00%) | (3.00%) | (3.00%) | ||
Intersegment Receivables Segment [Member] | |||||||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Assets | $ (2,698) | $ (2,698) | $ (2,228) | ||||
Segment reporting information, Percentage of Consolidated Assets | (6.00%) | (6.00%) | (5.00%) | ||||
All Other Segments [Member] | |||||||
Segment Reporting Information, Profit (Loss) [Abstract] | |||||||
Segment reporting information, Interest Expense | $ 74 | $ 65 | $ 146 | $ 128 | |||
Segment reporting information, Depreciation and Amortization | $ 1 | $ 3 | $ 4 | $ 4 | |||
Segment reporting information, Percentage of Consolidated Depreciation and Amortization | 0.00% | 1.00% | 1.00% | 1.00% | |||
Segment reporting information, Income Tax Expense (Benefit) | $ (20) | $ (11) | $ (55) | $ (40) | |||
Segment reporting information, Earnings (Losses) | (46) | $ (55) | (83) | (82) | |||
Segment Reporting Information, Additional Information [Abstract] | |||||||
Segment reporting information, Expenditures for property plant and equipment | $ 7 | $ 27 | |||||
Segment reporting information, Percentage of Consolidated Expenditures for Property, Plant & Equipment | 1.00% | 2.00% | |||||
Segment reporting information, Assets | $ 803 | $ 803 | $ 734 | ||||
Segment reporting information, Percentage of Consolidated Assets | 2.00% | 2.00% | 2.00% | ||||
Equity Method and Other Investments | $ 75 | $ 75 | $ 75 | ||||
[1] | Derived from audited financial statements. | ||||||
[2] | After preferred dividends. | ||||||
[3] | Revenues for reportable segments include intersegment revenues of a negligible amount, $18 million, $27 million and $36 million for the three months ended June 30, 2016; $3 million, $35 million, $54 million and $66 million for the six months ended June 30, 2016; $3 million, $17 million, $24 million and $46 million for the three months ended June 30, 2015; and $5 million, $36 million, $49 million and $89 million for the six months ended June 30, 2015 for SDG&E, SoCalGas, Sempra Mexico and Sempra Natural Gas, respectively. |