| Recurring Fair Value Measures |
| | | | | | | | | | | | | | | | | | | | | | | | | RECURRING FAIR VALUE MEASURES – SEMPRA | | (Dollars in millions) | | | Fair value at September 30, 2022 | | | Level 1 | | Level 2 | | Level 3 | | Total | | Assets: | | | | | | | | | Nuclear decommissioning trusts: | | | | | | | | Short-term investments, primarily cash equivalents | $ | 16 | | | $ | 1 | | | $ | — | | | $ | 17 | | | Equity securities | 265 | | | 4 | | | — | | | 269 | | | Debt securities: | | | | | | | | Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 21 | | | 13 | | | — | | | 34 | | | Municipal bonds | — | | | 273 | | | — | | | 273 | | | Other securities | — | | | 226 | | | — | | | 226 | | | Total debt securities | 21 | | | 512 | | | — | | | 533 | | Total nuclear decommissioning trusts(1) | 302 | | | 517 | | | — | | | 819 | | | Short-term investments held in Rabbi Trust | 51 | | | — | | | — | | | 51 | | | Interest rate instruments | — | | | 43 | | | — | | | 43 | | | Foreign exchange instruments | — | | | 1 | | | — | | | 1 | | | Commodity contracts not subject to rate recovery | — | | | 72 | | | — | | | 72 | | Effect of netting and allocation of collateral(2) | 80 | | | — | | | — | | | 80 | | | Commodity contracts subject to rate recovery | 16 | | | 1 | | | 33 | | | 50 | | Effect of netting and allocation of collateral(2) | 33 | | | — | | | 6 | | | 39 | | | Support Agreement, net of related guarantee fees | — | | | — | | | 16 | | | 16 | | | Total | $ | 482 | | | $ | 634 | | | $ | 55 | | | $ | 1,171 | | | Liabilities: | | | | | | | | | Foreign exchange instruments | $ | — | | | $ | 2 | | | $ | — | | | $ | 2 | | | Interest rate and foreign exchange instruments | — | | | 117 | | | — | | | 117 | | | Commodity contracts not subject to rate recovery | — | | | 73 | | | — | | | 73 | | | Commodity contracts subject to rate recovery | 4 | | | 18 | | | — | | | 22 | | | Total | $ | 4 | | | $ | 210 | | | $ | — | | | $ | 214 | |
(1) Excludes receivables (payables), net. (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. | | | | | | | | | | | | | | | | | | | | | | | | | RECURRING FAIR VALUE MEASURES – SEMPRA (CONTINUED) | | (Dollars in millions) | | Fair value at December 31, 2021 | | Level 1 | | Level 2 | | Level 3 | | Total | | Assets: | | | | | | | | | Nuclear decommissioning trusts: | | | | | | | | | Short-term investments, primarily cash equivalents | $ | 13 | | | $ | (10) | | | $ | — | | | $ | 3 | | | Equity securities | 358 | | | 6 | | | — | | | 364 | | | Debt securities: | | | | | | | | Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 48 | | | 8 | | | — | | | 56 | | | Municipal bonds | — | | | 321 | | | — | | | 321 | | | Other securities | — | | | 260 | | | — | | | 260 | | | Total debt securities | 48 | | | 589 | | | — | | | 637 | | Total nuclear decommissioning trusts(1) | 419 | | | 585 | | | — | | | 1,004 | | | Short-term investments held in Rabbi Trust | 81 | | | — | | | — | | | 81 | | | Interest rate instruments | — | | | 6 | | | — | | | 6 | | | Foreign exchange instruments | — | | | 2 | | | — | | | 2 | | | Commodity contracts not subject to rate recovery | — | | | 46 | | | — | | | 46 | | Effect of netting and allocation of collateral(2) | 58 | | | — | | | — | | | 58 | | | Commodity contracts subject to rate recovery | 12 | | | 1 | | | 69 | | | 82 | | Effect of netting and allocation of collateral(2) | 31 | | | 9 | | | 6 | | | 46 | | | Support Agreement, net of related guarantee fees | — | | | — | | | 7 | | | 7 | | | Total | $ | 601 | | | $ | 649 | | | $ | 82 | | | $ | 1,332 | | | Liabilities: | | | | | | | | | Interest rate instruments | $ | — | | | $ | 8 | | | $ | — | | | $ | 8 | | | Foreign exchange instruments | — | | | 1 | | | — | | | 1 | | | Interest rate and foreign exchange instruments | — | | | 131 | | | — | | | 131 | | | Commodity contracts not subject to rate recovery | — | | | 31 | | | — | | | 31 | | | Commodity contracts subject to rate recovery | — | | | 35 | | | 15 | | | 50 | | | Total | $ | — | | | $ | 206 | | | $ | 15 | | | $ | 221 | |
(1) Excludes receivables (payables), net. (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. | | | | | | | | | | | | | | | | | | | | | | | | | RECURRING FAIR VALUE MEASURES – SDG&E | | (Dollars in millions) | | | Fair value at September 30, 2022 | | | Level 1 | | Level 2 | | Level 3 | | Total | | Assets: | | | | | | | | | Nuclear decommissioning trusts: | | | | | | | | Short-term investments, primarily cash equivalents | $ | 16 | | | $ | 1 | | | $ | — | | | $ | 17 | | | Equity securities | 265 | | | 4 | | | — | | | 269 | | | Debt securities: | | | | | | | | Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 21 | | | 13 | | | — | | | 34 | | | Municipal bonds | — | | | 273 | | | — | | | 273 | | | Other securities | — | | | 226 | | | — | | | 226 | | | Total debt securities | 21 | | | 512 | | | — | | | 533 | | Total nuclear decommissioning trusts(1) | 302 | | | 517 | | | — | | | 819 | | | Commodity contracts subject to rate recovery | 16 | | | — | | | 33 | | | 49 | | Effect of netting and allocation of collateral(2) | 31 | | | — | | | 6 | | | 37 | | | Total | $ | 349 | | | $ | 517 | | | $ | 39 | | | $ | 905 | | | | | | | | | | | Liabilities: | | | | | | | | | Commodity contracts subject to rate recovery | $ | 4 | | | $ | — | | | $ | — | | | $ | 4 | | | Total | $ | 4 | | | $ | — | | | $ | — | | | $ | 4 | | | | | | | | | | | | Fair value at December 31, 2021 | | | Level 1 | | Level 2 | | Level 3 | | Total | | Assets: | | | | | | | | | Nuclear decommissioning trusts: | | | | | | | | Short-term investments, primarily cash equivalents | $ | 13 | | | $ | (10) | | | $ | — | | | $ | 3 | | | Equity securities | 358 | | | 6 | | | — | | | 364 | | | Debt securities: | | | | | | | | Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies | 48 | | | 8 | | | — | | | 56 | | | Municipal bonds | — | | | 321 | | | — | | | 321 | | | Other securities | — | | | 260 | | | — | | | 260 | | | Total debt securities | 48 | | | 589 | | | — | | | 637 | | Total nuclear decommissioning trusts(1) | 419 | | | 585 | | | — | | | 1,004 | | | Commodity contracts subject to rate recovery | 12 | | | — | | | 69 | | | 81 | | Effect of netting and allocation of collateral(2) | 22 | | | — | | | 6 | | | 28 | | | Total | $ | 453 | | | $ | 585 | | | $ | 75 | | | $ | 1,113 | | | | | | | | | | | Liabilities: | | | | | | | | | Commodity contracts subject to rate recovery | $ | — | | | $ | — | | | $ | 15 | | | $ | 15 | | | Total | $ | — | | | $ | — | | | $ | 15 | | | $ | 15 | |
(1) Excludes receivables (payables), net. (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. | | | | | | | | | | | | | | | | | | | | | | | | | RECURRING FAIR VALUE MEASURES – SOCALGAS | | (Dollars in millions) | | | Fair value at September 30, 2022 | | | Level 1 | | Level 2 | | Level 3 | | Total | | Assets: | | | | | | | | | Commodity contracts subject to rate recovery | $ | — | | | $ | 1 | | | $ | — | | | $ | 1 | | Effect of netting and allocation of collateral(1) | 2 | | | — | | | — | | | 2 | | | Total | $ | 2 | | | $ | 1 | | | $ | — | | | $ | 3 | | | | | | | | | | | Liabilities: | | | | | | | | | Commodity contracts subject to rate recovery | $ | — | | | $ | 18 | | | $ | — | | | $ | 18 | | | Total | $ | — | | | $ | 18 | | | $ | — | | | $ | 18 | | | | | | | | | | | | Fair value at December 31, 2021 | | | Level 1 | | Level 2 | | Level 3 | | Total | | Assets: | | | | | | | | | Commodity contracts subject to rate recovery | $ | — | | | $ | 1 | | | $ | — | | | $ | 1 | | Effect of netting and allocation of collateral(1) | 9 | | | 9 | | | — | | | 18 | | | Total | $ | 9 | | | $ | 10 | | | $ | — | | | $ | 19 | | | | | | | | | | | Liabilities: | | | | | | | | | Commodity contracts subject to rate recovery | $ | — | | | $ | 35 | | | $ | — | | | $ | 35 | | | Total | $ | — | | | $ | 35 | | | $ | — | | | $ | 35 | |
(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.
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| Recurring Fair Value Measures Level 3 Rollforward |
The table below sets forth reconciliations of changes in the fair value of CRRs and long-term, fixed-price electricity positions classified as Level 3 in the fair value hierarchy for Sempra and SDG&E. | | | | | | | | | | | | LEVEL 3 RECONCILIATIONS(1) | | (Dollars in millions) | | | Three months ended September 30, | | | 2022 | | 2021 | | Balance at July 1 | $ | 33 | | | $ | 80 | | | Realized and unrealized losses | (35) | | | (35) | | | Allocated transmission instruments | 2 | | | 1 | | | Settlements | 33 | | | 26 | | | Balance at September 30 | $ | 33 | | | $ | 72 | | | Change in unrealized gains relating to instruments still held at September 30 | $ | 3 | | | $ | 9 | | | | | | | Nine months ended September 30, | | 2022 | | 2021 | | Balance at January 1 | $ | 54 | | | $ | 69 | | | Realized and unrealized losses | (58) | | | (29) | | | Allocated transmission instruments | (4) | | | (1) | | | Settlements | 41 | | | 33 | | | Balance at September 30 | $ | 33 | | | $ | 72 | | | Change in unrealized (losses) gains relating to instruments still held at September 30 | $ | (15) | | | $ | 5 | |
(1) Excludes the effect of the contractual ability to settle contracts under master netting agreements. The table below sets forth reconciliations of changes in the fair value of Sempra’s Support Agreement for the benefit of CFIN classified as Level 3 in the fair value hierarchy for Sempra. | | | | | | | | | | | | | LEVEL 3 RECONCILIATIONS | | (Dollars in millions) | | Three months ended September 30, | | | 2022 | | 2021 | | Balance at July 1 | $ | 16 | | | $ | 4 | | Realized and unrealized gains(1) | 2 | | | 3 | | | Settlements | (2) | | | (2) | | Balance at September 30(2) | $ | 16 | | | $ | 5 | | | Change in unrealized gains relating to instruments still held at September 30 | $ | 2 | | | $ | 3 | | | | | | | Nine months ended September 30, | | 2022 | | 2021 | | Balance at January 1 | $ | 7 | | | $ | 3 | | Realized and unrealized gains(1) | 16 | | | 8 | | | Settlements | (7) | | | (6) | | Balance at September 30(2) | $ | 16 | | | $ | 5 | | | Change in unrealized gains relating to instruments still held at September 30 | $ | 15 | | | $ | 7 | |
(1) Net gains are included in Interest Income and net losses are included in Interest Expense on Sempra’s Condensed Consolidated Statements of Operations. (2) Includes $7 in Other Current Assets and $9 in Other Long-term Assets at September 30, 2022 on Sempra’s Condensed Consolidated Balance Sheet.
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| Fair Value of Financial Instruments |
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. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | FAIR VALUE OF FINANCIAL INSTRUMENTS | | (Dollars in millions) | | | Carrying
amount | | Fair value | | | | Level 1 | | Level 2 | | Level 3 | | Total | | September 30, 2022 | | Sempra: | | | | | | | | | | | | | | | | | | | | Long-term note receivable(1) | $ | 314 | | | $ | — | | | $ | — | | | $ | 279 | | | $ | 279 | | | Long-term amounts due to unconsolidated affiliates | 296 | | | — | | | 251 | | | — | | | 251 | | Total long-term debt(2) | 23,790 | | | — | | | 20,288 | | | — | | | 20,288 | | | SDG&E: | | | | | | | | | | Total long-term debt(3) | $ | 7,800 | | | $ | — | | | $ | 6,577 | | | $ | — | | | $ | 6,577 | | | SoCalGas: | | | | | | | | | | Total long-term debt(4) | $ | 5,459 | | | $ | — | | | $ | 4,789 | | | $ | — | | | $ | 4,789 | | | | | | | | | | | | | | December 31, 2021 | | Sempra: | | | | | | | | | | Long-term note receivable(1) | $ | 300 | | | $ | — | | | $ | — | | | $ | 327 | | | $ | 327 | | Long-term amounts due from unconsolidated affiliates(5) | 640 | | | — | | | 642 | | | — | | | 642 | | | Long-term amounts due to unconsolidated affiliates | 287 | | | — | | | 295 | | | — | | | 295 | | Total long-term debt(2) | 20,099 | | | — | | | 22,126 | | | — | | | 22,126 | | | SDG&E: | | | | | | | | | | Total long-term debt(3) | $ | 6,417 | | | $ | — | | | $ | 7,236 | | | $ | — | | | $ | 7,236 | | | SoCalGas: | | | | | | | | | | Total long-term debt(4) | $ | 4,759 | | | $ | — | | | $ | 5,367 | | | $ | — | | | $ | 5,367 | |
(1) Before allowances for credit losses of $7 and $8 at September 30, 2022 and December 31, 2021, respectively. Excludes unamortized transaction costs of $5 at September 30, 2022 and December 31, 2021. (2) Before reductions of unamortized discount and debt issuance costs of $287 and $260 at September 30, 2022 and December 31, 2021, respectively, and excluding finance lease obligations of $1,332 and $1,335 at September 30, 2022 and December 31, 2021, respectively. (3) Before reductions of unamortized discount and debt issuance costs of $72 and $61 at September 30, 2022 and December 31, 2021, respectively, and excluding finance lease obligations of $1,260 and $1,274 at September 30, 2022 and December 31, 2021, respectively. (4) Before reductions of unamortized discount and debt issuance costs of $41 and $36 at September 30, 2022 and December 31, 2021, respectively, and excluding finance lease obligations of $72 and $61 at September 30, 2022 and December 31, 2021, respectively. (5) Before allowances for credit losses of $1 at December 31, 2021. Includes $2 of accrued interest receivable at December 31, 2021 in Due From Unconsolidated Affiliates – Current.
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