SEGMENT INFORMATION

9 Months Ended

Sep. 30, 2016

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

We have six separately managed, reportable segments, as follows:

1. SDG&E provides electric service to San Diego and southern Orange counties and natural gas service to San Diego County.

2. SoCalGas is a natural gas distribution utility, serving customers throughout most of Southern California and part of central California.

3. Sempra South American Utilities develops, owns and operates, or holds interests in, electric transmission, distribution and generation infrastructure in Chile and Peru.

4. Sempra Mexico develops, owns and operates, or holds interests in, natural gas transmission pipelines and propane and ethane systems, a liquid petroleum gas pipeline and associated storage terminal, a natural gas distribution utility, electric generation facilities (including wind and solar), 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.

5. 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.

6. Sempra Natural Gas develops, owns and operates, or holds interests in, natural gas pipelines and storage facilities and a terminal for the import and export of LNG and sale of natural gas, all within the United States. In September 2016, Sempra Natural Gas sold EnergySouth, the parent company of Mobile Gas and Willmut Gas, and in May 2016, sold its 25-percent interest in Rockies Express, 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 September 30,										Nine months ended September 30,
	2016					2015					2016					2015
REVENUES
SDG&E	$	1,209		48	%	$	1,230		50	%	$	3,192		44	%	$	3,168		42	%
SoCalGas	686			27		620			25		2,336			32		2,448			33
Sempra South American Utilities	385			15		373			15		1,170			16		1,151			15
Sempra Mexico	196			8		193			8		481			7		508			7
Sempra Renewables	12			1		12			—		25			—		30			—
Sempra Natural Gas	164			6		160			6		384			5		512			7
Adjustments and eliminations	(1		)	—		—			—		(1		)	—		(1		)	—
Intersegment revenues(1)	(116		)	(5	)	(107		)	(4	)	(274		)	(4	)	(286		)	(4	)
Total	$	2,535		100	%	$	2,481		100	%	$	7,313		100	%	$	7,530		100	%
INTEREST EXPENSE
SDG&E	$	49				$	51				$	145				$	155
SoCalGas	25					23					71					61
Sempra South American Utilities	9					9					29					22
Sempra Mexico	5					7					13					18
Sempra Renewables	—					1					—					3
Sempra Natural Gas	11					13					33					57
All other	68					65					214					193
Intercompany eliminations	(31		)			(26		)			(84		)			(93		)
Total	$	136				$	143				$	421				$	416
INTEREST INCOME
SoCalGas	$	—				$	—				$	—				$	3
Sempra South American Utilities	5					5					15					14
Sempra Mexico	2					1					5					5
Sempra Renewables	1					2					2					3
Sempra Natural Gas	19					16					52					60
All other	1					—					1					—
Intercompany eliminations	(21		)			(18		)			(56		)			(62		)
Total	$	7				$	6				$	19				$	23
DEPRECIATION AND AMORTIZATION
SDG&E	$	161		49	%	$	152		48	%	$	478		49	%	$	446		48	%
SoCalGas	121			37		116			37		355			37		342			37
Sempra South American Utilities	14			4		12			4		41			4		37			4
Sempra Mexico	15			5		18			6		47			5		52			6
Sempra Renewables	1			—		2			—		4			—		5			—
Sempra Natural Gas	12			4		12			4		37			4		36			4
All other	4			1		3			1		8			1		7			1
Total	$	328		100	%	$	315		100	%	$	970		100	%	$	925		100	%
INCOME TAX EXPENSE (BENEFIT)
SDG&E	$	91				$	75				$	204				$	217
SoCalGas	21					(20		)			75					91
Sempra South American Utilities	17					16					46					50
Sempra Mexico	142					(6		)			170					7
Sempra Renewables	(7		)			(9		)			(29		)			(37		)
Sempra Natural Gas	51					—					(77		)			29
All other	(33		)			(41		)			(105		)			(81		)
Total	$	282				$	15				$	284				$	276

SEGMENT INFORMATION (CONTINUED)
(Dollars in millions)
	Three months ended September 30,						Nine months ended September 30,
	2016			2015			2016					2015
EQUITY EARNINGS (LOSSES)
Earnings (losses) recorded before tax:
Sempra Renewables	$	12		$	8		$	30				$	20
Sempra Natural Gas	—			25			(26		)			59
Total	$	12		$	33		$	4				$	79
Earnings (losses) recorded net of tax:
Sempra South American Utilities	$	1		$	(3	)	$	3				$	(4	)
Sempra Mexico	18			30			66					68
Total	$	19		$	27		$	69				$	64
EARNINGS (LOSSES)
SDG&E	$	183		$	170		$	419				$	443
SoCalGas(2)	—			(8		)	198					276
Sempra South American Utilities	46			43			127					129
Sempra Mexico	332			63			407					160
Sempra Renewables	17			15			43					47
Sempra Natural Gas	77			1			(104		)			43
All other	(33		)	(36		)	(99		)			(118		)
Total	$	622		$	248		$	991				$	980
EXPENDITURES FOR PROPERTY, PLANT & EQUIPMENT
SDG&E							$	959		31	%	$	835		38	%
SoCalGas							949			31		946			42
Sempra South American Utilities							133			4		105			5
Sempra Mexico							232			8		185			8
Sempra Renewables							700			23		47			2
Sempra Natural Gas							100			3		61			3
All other							14			—		48			2
Total							$	3,087		100	%	$	2,227		100	%
							September 30, 2016					December 31, 2015
ASSETS
SDG&E							$	17,446		38	%	$	16,515		40	%
SoCalGas							13,148			29		12,104			29
Sempra South American Utilities							3,488			8		3,235			8
Sempra Mexico							6,359			14		3,783			9
Sempra Renewables							2,112			5		1,441			4
Sempra Natural Gas							5,377			12		5,566			13
All other							640			1		734			2
Intersegment receivables							(3,044		)	(7	)	(2,228		)	(5	)
Total							$	45,526		100	%	$	41,150		100	%
EQUITY METHOD AND OTHER INVESTMENTS
Sempra South American Utilities							$	(1	)			$	(4	)
Sempra Mexico							108					519
Sempra Renewables							819					855
Sempra Natural Gas							838					1,460
All other							76					75
Total							$	1,840				$	2,905

(1) Revenues for reportable segments include intersegment revenues of $2 million, $21 million, $26 million and $67 million for the three months ended September 30, 2016; $5 million, $56 million, $80 million and $133 million for the nine months ended September 30, 2016; $2 million, $19 million, $24 million and $62 million for the three months ended September 30, 2015; and $7 million, $55 million, $73 million and $151 million for the nine months ended September 30, 2015 for SDG&E, SoCalGas, Sempra Mexico and Sempra Natural Gas, respectively.

(2) After preferred dividends.