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FAIR VALUE MEASUREMENTS (Tables)

6 Months Ended

Jun. 30, 2022


RECURRING FAIR VALUE MEASURES – SEMPRA
(Dollars in millions)
	Fair value at June 30, 2022
	Level 1		Level 2		Level 3		Total
Assets:
Nuclear decommissioning trusts:
Short-term investments, primarily cash equivalents	$	15	$	—	$	—	$	15
Equity securities	283		5		—		288
Debt securities:
Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	30		13		—		43
Municipal bonds	—		293		—		293
Other securities	—		237		—		237
Total debt securities	30		543		—		573
Total nuclear decommissioning trusts(1)	328		548		—		876
Short-term investments held in Rabbi Trust	50		—		—		50
Interest rate instruments	—		32		—		32
Commodity contracts not subject to rate recovery	—		74		—		74
Effect of netting and allocation of collateral(2)	76		—		—		76
Commodity contracts subject to rate recovery	13		1		35		49
Effect of netting and allocation of collateral(2)	32		10		6		48
Support Agreement, net of related guarantee fees	—		—		16		16
Total	$	499	$	665	$	57	$	1,221
Liabilities:
Foreign exchange instruments	$	—	$	2	$	—	$	2
Interest rate and foreign exchange instruments	—		117		—		117
Commodity contracts not subject to rate recovery	—		72		—		72
Commodity contracts subject to rate recovery	—		18		2		20
Total	$	—	$	209	$	2	$	211

(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 June 30, 2022
	Level 1		Level 2		Level 3		Total
Assets:
Nuclear decommissioning trusts:
Short-term investments, primarily cash equivalents	$	15	$	—	$	—	$	15
Equity securities	283		5		—		288
Debt securities:
Debt securities issued by the U.S. Treasury and other U.S. government corporations and agencies	30		13		—		43
Municipal bonds	—		293		—		293
Other securities	—		237		—		237
Total debt securities	30		543		—		573
Total nuclear decommissioning trusts(1)	328		548		—		876
Commodity contracts subject to rate recovery	13		—		35		48
Effect of netting and allocation of collateral(2)	30		—		6		36
Total	$	371	$	548	$	41	$	960

Liabilities:
Commodity contracts subject to rate recovery	$	—	$	9	$	2	$	11
Total	$	—	$	9	$	2	$	11

	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 June 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		10		—		12
Total	$	2	$	11	$	—	$	13

Liabilities:
Commodity contracts subject to rate recovery	$	—	$	9	$	—	$	9
Total	$	—	$	9	$	—	$	9

	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.

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 June 30,
	2022		2021
Balance at April 1	$	58	$	62
Realized and unrealized (losses) gains	(30)		8
Allocated transmission instruments	(6)		(2)
Settlements	11		12
Balance at June 30	$	33	$	80
Change in unrealized (losses) gains relating to instruments still held at June 30	$	(23)	$	14

	Six months ended June 30,
	2022		2021
Balance at January 1	$	54	$	69
Realized and unrealized (losses) gains	(23)		6
Allocated transmission instruments	(6)		(2)
Settlements	8		7
Balance at June 30	$	33	$	80
Change in unrealized (losses) gains relating to instruments still held at June 30	$	(18)	$	12

(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 June 30,
	2022		2021
Balance at April 1	$	12	$	3
Realized and unrealized gains(1)	6		3
Settlements	(2)		(2)
Balance at June 30(2)	$	16	$	4
Change in unrealized gains relating to instruments still held at June 30	$	5	$	2

	Six months ended June 30,
	2022		2021
Balance at January 1	$	7	$	3
Realized and unrealized gains(1)	14		5
Settlements	(5)		(4)
Balance at June 30(2)	$	16	$	4
Change in unrealized gains relating to instruments still held at June 30	$	13	$	4

(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 June 30, 2022 on Sempra’s Condensed Consolidated Balance Sheet.

Schedule of Fair Value Inputs

For the CRRs settling from January 1 to December 31, the auction price inputs, at a given location, were in the following ranges for the years indicated below:


CONGESTION REVENUE RIGHTS AUCTION PRICE INPUTS

Settlement year	Price per MWh					Median price per MWh
2022	$	(3.67)	to	$	6.96	$	(0.70)
2021	(1.81)		to	14.11		(0.12)

The range and weighted-average price of these inputs at June 30 were as follows:


LONG-TERM, FIXED-PRICE ELECTRICITY POSITIONS PRICE INPUTS

Settlement year	Price per MWh					Weighted-average price per MWh
2022	$	25.25	to	$	125.00	$	66.36
2021		22.45	to		151.90		49.27

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
	June 30, 2022
Sempra:
Short-term amounts due from unconsolidated affiliates(1)	$	626	$	—	$	630	$	—	$	630
Long-term note receivable(2)	310		—		—		278		278
Long-term amounts due to unconsolidated affiliates	282		—		251		—		251
Total long-term debt(3)	23,924		—		21,709		—		21,709
SDG&E:
Total long-term debt(4)	$	7,800	$	—	$	7,102	$	—	$	7,102
SoCalGas:
Total long-term debt(5)	$	5,459	$	—	$	5,110	$	—	$	5,110

	December 31, 2021
Sempra:
Long-term note receivable(2)	$	300	$	—	$	—	$	327	$	327
Long-term amounts due from unconsolidated affiliates(1)	640		—		642		—		642
Long-term amounts due to unconsolidated affiliates	287		—		295		—		295
Total long-term debt(3)	20,099		—		22,126		—		22,126
SDG&E:
Total long-term debt(4)	$	6,417	$	—	$	7,236	$	—	$	7,236
SoCalGas:
Total long-term debt(5)	$	4,759	$	—	$	5,367	$	—	$	5,367

(1) Before allowances for credit losses of $1 at December 31, 2021. Includes $1 and $2 of accrued interest receivable at June 30, 2022 and December 31, 2021, respectively, in Due From Unconsolidated Affiliates – Current.

(2) Before allowances for credit losses of $7 and $8 at June 30, 2022 and December 31, 2021, respectively. Excludes unamortized transaction costs of $5 at both June 30, 2022 and December 31, 2021, respectively.

(3) Before reductions of unamortized discount and debt issuance costs of $294 and $260 at June 30, 2022 and December 31, 2021, respectively, and excluding finance lease obligations of $1,334 and $1,335 at June 30, 2022 and December 31, 2021, respectively.

(4) Before reductions of unamortized discount and debt issuance costs of $73 and $61 at June 30, 2022 and December 31, 2021, respectively, and excluding finance lease obligations of $1,266 and $1,274 at June 30, 2022 and December 31, 2021, respectively.

(5) Before reductions of unamortized discount and debt issuance costs of $43 and $36 at June 30, 2022 and December 31, 2021, respectively, and excluding finance lease obligations of $68 and $61 at June 30, 2022 and December 31, 2021, respectively.