SEGMENT INFORMATION

6 Months Ended

Jun. 30, 2016

Segment [Abstract]

Segment Information

NOTE 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 generation 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 wind), a terminal for the import of LNG, and marketing operations for the purchase of LNG and the purchase and sale of natural gas in Mexico. In February 2016, management approved a plan to market and sell the TdM natural gas-fired power plant located in Mexicali, Baja California, as we discuss in Note 3.
• Sempra Renewables develops, owns and operates, or holds interests in, wind and solar energy projects in Arizona, California, Colorado, Hawaii, Indiana, Kansas, Michigan, Minnesota, Nebraska, Nevada and Pennsylvania to serve wholesale 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 for 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 Rockies 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 Sempra 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 Financial Statements in the Annual Report.

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

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

SEGMENT INFORMATION
(Dollars in millions)
	Three months ended 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.