DERIVATIVE FINANCIAL INSTRUMENTS (Tables)

3 Months Ended

Sep. 30, 2012

Derivative Financial Instruments (Tables) [Abstract]


Segment and Commodity		September 30, 2012	December 31, 2011
California Utilities:
SDG&E:
Natural gas		23 million MMBtu	35 million MMBtu	(1)
Congestion revenue rights		18 million MWh	19 million MWh	(2)

Energy-Related Businesses:
Sempra Natural Gas:
Electric power		2 million MWh	5 million MWh
Natural gas		32 million MMBtu	20 million MMBtu
Sempra Mexico - natural gas		1 million MMBtu	1 million MMBtu
(1)	Million British thermal units
(2)	Megawatt hours

Notional Amounts of Interest Rate Derivatives Table

		September 30, 2012			December 31, 2011
(Dollars in millions)		Notional Debt		Maturities	Notional Debt		Maturities
Sempra Energy Consolidated(1)		$	6-369	2013-2028	$	15-305	2013-2019
SDG&E(1)			285-347	2019		285-355	2019
(1)	Includes Otay Mesa VIE. All of SDG&E’s interest rate derivatives relate to Otay Mesa VIE.

Derivative Instruments on the Condensed Consolidated Balance Sheets Table

DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
		September 30, 2012
									Deferred
									credits
			Current				Current		and other
			assets:				liabilities:		liabilities:
			Fixed-price		Investments		Fixed-price		Fixed-price
			contracts		and other		contracts		contracts
			and other		assets:		and other		and other
Derivatives designated as hedging instruments			derivatives(1)		Sundry		derivatives(2)		derivatives
Sempra Energy Consolidated:
Interest rate instruments(3)		$	6	$	15	$	(20)	$	(69)
Commodity contracts not subject to rate recovery			―		―		(3)		―
Total		$	6	$	15	$	(23)	$	(69)
SDG&E:
Interest rate instruments(3)		$	―	$	―	$	(17)	$	(68)

Derivatives not designated as hedging instruments
Sempra Energy Consolidated:
Interest rate and foreign exchange instruments		$	8	$	43	$	(8)	$	(38)
Commodity contracts not subject to rate recovery			119		19		(131)		(31)
Associated offsetting commodity contracts			(111)		(15)		111		15
Commodity contracts subject to rate recovery			9		20		(39)		(7)
Associated offsetting commodity contracts			(5)		(1)		5		1
Total		$	20	$	66	$	(62)	$	(60)
SDG&E:
Commodity contracts subject to rate recovery		$	7	$	20	$	(37)	$	(7)
Associated offsetting commodity contracts			(4)		(1)		4		1
Total		$	3	$	19	$	(33)	$	(6)
SoCalGas:
Commodity contracts subject to rate recovery		$	2	$	―	$	(2)	$	―
Associated offsetting commodity contracts			(1)		―		1		―
Total		$	1	$	―	$	(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.

DERIVATIVE INSTRUMENTS ON THE CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
		December 31, 2011
									Deferred
									credits
			Current				Current		and other
			assets:				liabilities:		liabilities:
			Fixed-price		Investments		Fixed-price		Fixed-price
			contracts		and other		contracts		contracts
			and other		assets:		and other		and other
Derivatives designated as hedging instruments			derivatives(1)		Sundry		derivatives(2)		derivatives
Sempra Energy Consolidated:
Interest rate instruments(3)		$	5	$	11	$	(17)	$	(65)
SDG&E:
Interest rate instruments(3)		$	―	$	―	$	(16)	$	(65)

Derivatives not designated as hedging instruments
Sempra Energy Consolidated:
Interest rate instruments		$	8	$	41	$	(7)	$	(36)
Commodity contracts not subject to rate recovery			156		72		(148)		(94)
Associated offsetting commodity contracts			(120)		(68)		120		68
Commodity contracts subject to rate recovery			28		8		(62)		(24)
Associated offsetting commodity contracts			(10)		(2)		10		2
Total		$	62	$	51	$	(87)	$	(84)
SDG&E:
Commodity contracts subject to rate recovery		$	22	$	8	$	(55)	$	(24)
Associated offsetting commodity contracts			(5)		(2)		5		2
Total		$	17	$	6	$	(50)	$	(22)
SoCalGas:
Commodity contracts subject to rate recovery		$	6	$	―	$	(7)	$	―
Associated offsetting commodity contracts			(5)		―		5		―
Total		$	1	$	―	$	(2)	$	―
(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.

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

FAIR VALUE HEDGE IMPACT ON THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in millions)
			Gain on derivatives recognized in earnings				Gain (loss) on derivatives recognized in earnings
			Three months ended September 30,				Nine months ended September 30,
		Location	2012		2011		2012		2011
Sempra Energy Consolidated:
Interest rate instruments		Interest Expense	$	1	$	2	$	5	$	7
Interest rate instruments		Other Income, Net		4		13		6		16
Total(1)			$	5	$	15	$	11	$	23
SoCalGas:
Interest rate instrument		Interest Expense	$	―	$	―	$	―	$	1
Interest rate instrument		Other Income, Net		―		―		―		(3)
Total(1)			$	―	$	―	$	―	$	(2)
(1)	There has been no hedge ineffectiveness on these swaps. Changes in the fair values of the interest rate swap agreements are exactly offset by changes in the fair value of the underlying long-term debt.

Cash Flow Hedge Impact on the Condensed Consolidated Statements of Operations Table

CASH FLOW HEDGE IMPACT ON THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in millions)
		Pretax loss recognized					Gain (loss) reclassified from AOCI
		in OCI (effective portion)					into earnings (effective portion)
		Three months ended September 30,					Three months ended September 30,
		2012		2011		Location	2012		2011
Sempra Energy Consolidated:
Interest rate instruments(1)		$	(6)	$	(21)	Interest Expense	$	(3)	$	4
						Equity Losses,
Interest rate instruments			(6)		(27)	Before Income Tax		(4)		(2)
Commodity contracts not subject						Cost of Natural Gas, Electric
to rate recovery			(3)		―	Fuel and Purchased Power		―		―
Total		$	(15)	$	(48)		$	(7)	$	2
SDG&E:
Interest rate instruments(1)		$	(6)	$	(21)	Interest Expense	$	(2)	$	4
SoCalGas:
Interest rate instruments		$	―	$	―	Interest Expense	$	(1)	$	(1)
		Nine months ended September 30,					Nine months ended September 30,
		2012		2011		Location	2012		2011
Sempra Energy Consolidated:
Interest rate instruments(1)		$	(21)	$	(32)	Interest Expense	$	(5)	$	―
						Equity Losses,
Interest rate instruments			(12)		(34)	Before Income Tax		(4)		(3)
Commodity contracts not subject						Cost of Natural Gas, Electric
to rate recovery			(3)		―	Fuel and Purchased Power		―		―
Total		$	(36)	$	(66)		$	(9)	$	(3)
SDG&E:
Interest rate instruments(1)		$	(16)	$	(32)	Interest Expense	$	(3)	$	2
SoCalGas:
Interest rate instruments		$	―	$	―	Interest Expense	$	(2)	$	(3)
(1)	Amounts include Otay Mesa VIE. All of SDG&E’s interest rate derivative activity relates to Otay Mesa VIE. There has been a negligible amount of ineffectiveness related to these swaps.

Undesignated Derivative Impact on the Condensed Consolidated Statements of Operations Table

UNDESIGNATED DERIVATIVE IMPACT ON THE CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in millions)
		Gain (loss) on derivatives recognized in earnings
		Three months ended September 30,				Nine months ended September 30,
	Location	2012		2011		2012		2011
Sempra Energy Consolidated:
Interest rate and foreign exchange
instruments	Other Income, Net	$	1	$	(26)	$	11	$	(14)
Commodity contracts not subject	Revenues: Energy-Related
to rate recovery	Businesses		(5)		3		(3)		17
Commodity contracts not subject	Cost of Natural Gas, Electric
to rate recovery	Fuel and Purchased Power		―		―		―		1
Commodity contracts not subject
to rate recovery	Operation and Maintenance		1		―		1		1
Commodity contracts subject	Cost of Electric Fuel
to rate recovery	and Purchased Power		41		(15)		32		(6)
Commodity contracts subject
to rate recovery	Cost of Natural Gas		―		(2)		(1)		(1)
Total		$	38	$	(40)	$	40	$	(2)
SDG&E:
Commodity contracts not subject
to rate recovery	Operation and Maintenance	$	―	$	(1)	$	―	$	―
Commodity contracts subject	Cost of Electric Fuel
to rate recovery	and Purchased Power		41		(15)		32		(6)
Total		$	41	$	(16)	$	32	$	(6)
SoCalGas:
Commodity contracts not subject
to rate recovery	Operation and Maintenance	$	1	$	(1)	$	1	$	―
Commodity contracts subject
to rate recovery	Cost of Natural Gas		―		(2)		(1)		(1)
Total		$	1	$	(3)	$	―	$	(1)

- Definition

Tabular disclosure of the location and amount of gains and losses reported in the statement of financial performance, or when applicable, the statement of financial position. For example, (a) gains and losses recognized in the income statement on derivative instruments designated and qualifying as hedging instruments in fair value hedges and related hedged items designated and qualifying in fair value hedges and (b) gains and losses initially recognized in other comprehensive income on derivative instruments designated and qualifying as cash flow hedges.

+ References+ Details

- Definition

Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References+ Details