Company’s Rate Request Submitted to the CA Public Utilities Commission

Safeguarding energy reliability against growing climate threats and building a clean energy future aligned with regional and state climate goals are the driving forces behind the 2024-2027 budget proposal that San Diego Gas & Electric filed yesterday with the California Public Utilities Commission (CPUC). Every four years, regulated utilities in the state are required to file what are formally known as general rate cases (GRC) outlining their capital investments and forecasted costs for operations and maintenance. (Download B Roll Here)

In addition to maintaining high safety and reliability standards, SDG&E’s GRC also supports regional plans to reduce emissions, and the State of California’s goal to achieve carbon neutrality by 2045.

“Average electric bills at our company are the lowest among California’s electric investor-owned utilities, but we also recognize this is a difficult time to ask our customers to pay more given the state of the economy and inflationary pressures and are mindful of every dollar that we ask our customers to pay. Given the changes in climate and the growing need for a clean energy future, this will ultimately result in improvements that create long-term benefits now and for future generations,” SDG&E President Bruce Folkmann said. “The budget proposal we put forth represents the conscientious efforts of hundreds of SDG&E employees to strike the right balance between holding down costs and making the infrastructure investments needed for a clean energy future.”

According to a recent study conducted by SDG&E titled The Path to Net Zero: A Decarbonization Roadmap for California, electrification of buildings and vehicles is crucial for California to become carbon neutral. The analysis indicates electricity consumption in the state could nearly double by 2045. Meeting this increased demand will require a significant expansion of the power grid to both meet emissions reduction targets while also maintaining grid reliability.

All general rate cases are open and transparent proceedings conducted before the CPUC, involving extensive comments from customers, stakeholders and public interest advocates.

Major Investments Outlined in the Budget Proposal

• Expand, operate and maintain electric vehicle (EV) charging infrastructure throughout the region, given all passenger vehicle sales in California are required to be zero-emission by 2035, followed by the requirement that all medium and heavy-duty vehicle sales are to be zero-emission by 2045, where feasible.
• Modernize the electric grid with cutting-edge technology to enable the integration of significantly more solar and wind generation, residential and commercial-scale battery storage, EV charging, and customer transition from natural gas to electric appliances.
• Install more utility-scale battery systems at strategic locations to maximize the use of solar energy, which is often curtailed in the middle of the day because there is more supply than demand, and to support reliable service during periods of high energy demand, such as extremely hot summer days.
• Develop additional clean fuel sources, such as green hydrogen for transportation and electric generation with the goal of supporting greater electrification.
• Reduce wildfire risk and minimize Public Safety Power Shutoffs by hardening 590 miles of power lines between 2022 and 2024, either by burying them underground or insulating them.
• Cut the risk for power outages by adopting grid automation and remote sensing tools and replacing aging or failure-prone equipment, such as underground Tee connectors and corroded overhead switches.
• Give customers more control, access and insights into their energy usage by implementing the next generation of smart meters.
• Upgrade microgrids with zero-emissions energy resources (i.e., battery storage) to keep vulnerable communities and critical resources, such as healthcare and CALFIRE facilities, powered during Public Safety Power Shutoffs.
• Strengthen cybersecurity and technology infrastructure to address the risk of ever-changing security threats that could potentially disrupt business operations and place customer and employee health and safety at risk. These upgrades also will help secure customer data to meet stronger privacy regulations.
• Accelerate the replacement of aging plastic natural gas pipelines to improve safety and reliability and reduce methane emissions.

If SDG&E’s rate case is approved as submitted, the average residential customer could expect a monthly electric bill increase of about $9 compared to 2023, and a monthly natural gas bill increase of about $9.60 compared to 2023. SDG&E anticipates the CPUC to make a decision on its GRC in about 18 months, with new rates taking effect Jan. 1, 2024.

More information about SDG&E’s filing can be found at sdgeratesinfo.com.

About SDG&E

SDG&E is an innovative San Diego-based energy company that provides clean, safe and reliable energy to better the lives of the people it serves in San Diego and southern Orange counties. The company is committed to creating a sustainable future by providing its electricity from renewable sources; modernizing energy infrastructure; accelerating the adoption of electric vehicles; supporting numerous non-profit partners; and, investing in innovative technologies to ensure the reliable operation of the region’s infrastructure for generations to come. SDG&E is a subsidiary of Sempra (NYSE: SRE). For more information, visit SDGEnews.com or connect with SDG&E on Twitter (@SDGE), Instagram (@SDGE) and Facebook.

This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions with respect to the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed in any forward-looking statements. These forward-looking statements represent our estimates and assumptions only as of the date of this press release. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or other factors.

In this press release, forward-looking statements can be identified by words such as “believes,” “expects,” “intends,” “anticipates,” “plans,” “estimates,” “projects,” “forecasts,” “should,” “could,” “would,” “will,” “confident,” “may,” “can,” “potential,” “possible,” “proposed,” “in process,” “under construction,” “in development,” “opportunity,” “target,” “outlook,” “maintain,” “continue,” “goal,” “aim,” “commit,” or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations.

Factors, among others, that could cause actual results and events to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: California wildfires, including the risks that we may be found liable for damages regardless of fault and that we may not be able to recover all or a substantial portion of costs from insurance, the wildfire fund established by California Assembly Bill 1054, in rates from customers or a combination thereof; decisions, investigations, regulations, issuances or revocations of permits and other authorizations, renewals of franchises, and other actions by (i) the California Public Utilities Commission (CPUC), Comisión Reguladora de Energía, U.S. Department of Energy, U.S. Federal Energy Regulatory Commission, Public Utility Commission of Texas, and other regulatory and governmental bodies and (ii) states, counties, cities and other jurisdictions in the U.S., Mexico and other countries in which we do business; the success of business development efforts, construction projects and acquisitions and divestitures, including risks in (i) the ability to make a final investment decision, (ii) completing construction projects or other transactions on schedule and budget, (iii) the ability to realize anticipated benefits from any of these efforts if completed, and (iv) obtaining the consent or approval of partners or other third parties, including governmental entities and regulatory bodies; the resolution of civil and criminal litigation, regulatory inquiries, investigations and proceedings, arbitrations, and property disputes, including those related to the natural gas leak at Southern California Gas Company’s (SoCalGas) Aliso Canyon natural gas storage facility; changes to laws, including changes to certain of Mexico’s laws and rules that impact energy supplier permitting, energy contract rates, the electricity industry generally and the ability to import, export, transport and store hydrocarbons; cybersecurity threats, including by state and state-sponsored actors, to the energy grid, storage and pipeline infrastructure, information and systems used to operate our businesses, and confidentiality of our proprietary information and personal information of our customers and employees, including ransomware attacks on our systems and the systems of third-party vendors and other parties with which we conduct business, all of which have become more pronounced due to recent geopolitical events and other uncertainties, such as the war in Ukraine; failure of foreign governments and state-owned entities to honor their contracts and commitments; actions by credit rating agencies to downgrade our credit ratings or to place those ratings on negative outlook and our ability to borrow on favorable terms and meet our debt service obligations; the impact of energy and climate policies, legislation, rulemaking and disclosures, as well as related goals set and actions taken by companies in our industry, including actions to reduce or eliminate reliance on natural gas generally and any deterioration of or increased uncertainty in the political or regulatory environment for California natural gas distribution companies and the risk of nonrecovery for stranded assets; the pace of the development and adoption of new technologies in the energy sector, including those designed to support governmental and private party energy and climate goals, and our ability to timely and economically incorporate them into our business; weather, natural disasters, pandemics, accidents, equipment failures, explosions, acts of terrorism, information system outages or other events that disrupt our operations, damage our facilities and systems, cause the release of harmful materials, cause fires or subject us to liability for property damage or personal injuries, fines and penalties, some of which may not be covered by insurance, may be disputed by insurers or may otherwise not be recoverable through regulatory mechanisms or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of electric power and natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid or limitations on the withdrawal of natural gas from storage facilities; the impact of the COVID-19 pandemic, including potential vaccination mandates, on capital projects, regulatory approvals and the execution of our operations; the impact at San Diego Gas & Electric Company (SDG&E) on competitive customer rates and reliability due to the growth in distributed and local power generation, including from departing retail load resulting from customers transferring to Community Choice Aggregation and Direct Access, and the risk of nonrecovery for stranded assets and contractual obligations; Oncor Electric Delivery Company LLC’s (Oncor) ability to eliminate or reduce its quarterly dividends due to regulatory and governance requirements and commitments, including by actions of Oncor’s independent directors or a minority member director; volatility in foreign currency exchange, inflation and interest rates and commodity prices, including inflationary pressures in the U.S., and our ability to effectively hedge these risks and with respect to inflation and interest rates, the impact on SDG&E’s and SoCalGas’ cost of capital and the affordability of customer rates; changes in tax and trade policies, laws and regulations, including tariffs, revisions to international trade agreements and sanctions, such as those that have been imposed and that may be imposed in the future in connection with the war in Ukraine, which may increase our costs, reduce our competitiveness, impact our ability to do business with certain current or potential counterparties, or impair our ability to resolve trade disputes; and other uncertainties, some of which may be difficult to predict and are beyond our control.

These risks and uncertainties are further discussed in the reports that Sempra has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC's website, www.sec.gov, and on Sempra’s website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.

Sempra Infrastructure, Sempra Texas, Sempra Texas Utilities, Oncor and Infraestructura Energética Nova, S.A.P.I. de C.V. (IEnova) are not the same companies as the California utilities, SDG&E or SoCalGas, and Sempra Infrastructure, Sempra Texas, Sempra Texas Utilities, Oncor and IEnova are not regulated by the CPUC.

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