8-KOther Events

SEMPRA 8-K Report, Corporate Update (Sep 14, 2015)

Filed September 14, 2015For Securities:SRESREA

Summary

Sempra Energy (SRE) reported through its subsidiaries San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas) on September 11, 2015, that they have filed a settlement for their 2016 General Rate Case (GRC) with the California Public Utilities Commission (CPUC). This settlement resolves most key issues for the 2016 GRC, proposing total revenue requirements of $1,811 million for SDG&E and $2,219 million for SoCalGas. It also includes attrition adjustments of 3.5% for both 2017 and 2018 for each company. The settlement is subject to a 30-day comment period and final CPUC approval. A notable point of contention that remains unresolved is the treatment of certain intra-rate case income tax benefits, with an intervenor arguing these should be passed to ratepayers, a position Sempra believes deviates from established practices. The company anticipates that all aspects of the 2016 GRC will be finalized with the CPUC's ultimate decision.

Key Highlights

  • 1SDG&E and SoCalGas filed a settlement for their 2016 General Rate Case (GRC) on September 11, 2015.
  • 2The settlement proposes 2016 total revenue requirements of $1.811 billion for SDG&E and $2.219 billion for SoCalGas.
  • 3Attrition adjustments of 3.5% for 2017 and 2018 are included in the settlement for both utilities.
  • 4The settlement is supported by a majority of active parties in the proceeding.
  • 5A key unresolved issue is the treatment of certain income tax benefits, with an intervenor seeking them to be passed to ratepayers.
  • 6Sempra views the proposed tax benefit treatment as a material departure from long-standing ratemaking and tax policy.
  • 7The settlement is pending a 30-day comment period and final approval by the California Public Utilities Commission (CPUC).

Frequently Asked Questions

The main purpose of this filing is to report that Sempra Energy's subsidiaries, SDG&E and SoCalGas, have submitted a settlement agreement for their 2016 General Rate Case (GRC) to the California Public Utilities Commission (CPUC). This settlement aims to resolve most of the outstanding issues for the upcoming rate period.

The settlement proposes a total revenue requirement of $1,811 million for SDG&E and $2,219 million for SoCalGas for the year 2016.

The primary unresolved issue concerns the treatment of certain intra-rate case income tax benefits. An intervenor argues these benefits should be passed on to ratepayers, while Sempra believes this would be a significant departure from established ratemaking and tax policies and historical practice.

The filed settlement is subject to a 30-day comment period. Following this period, it will require approval from the California Public Utilities Commission (CPUC) before it can be finalized.