Company: SREA
Filing Date: 2025-11-05
Form Type: 10-Q
Source: 0001032208-25-000065
Chunk: 206

Company: SEMPRA
Filing Date: 2025-11-05
Form: 10-Q
Item: Item 2
Chunk 206
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 against earnings when available coverage is reduced due to recoverable claims from any of the participating IOUs. The carrying value of SDG&E’s Wildfire Fund asset totaled $264 million at September 30, 2025.

In October 2025, a participating IOU publicly disclosed that it has received, or expects to receive, approximately $1.2 billion in aggregate reimbursements from the Wildfire Fund for eligible claims related to wildfires that occurred in 2019 and 2021. In the three months and nine months ended September 30, 2025, SDG&E reduced its Wildfire Fund asset by recording $2 million of accelerated amortization in O&M on Sempra’s and SDG&E’s Condensed Consolidated Statements of Operations.

Also in October 2025, another participating IOU publicly disclosed its intent to seek reimbursement from the Wildfire Fund for losses incurred and expected to be incurred in connection with a wildfire that remains under investigation, and for which the cause has not yet been conclusively determined. The administrator of the Wildfire Fund has confirmed that this wildfire qualifies as a “covered wildfire” for purposes of accessing the fund. The participating IOU has stated that it is currently unable to reasonably estimate a range of potential losses associated with this event. Accordingly, SDG&E is unable to estimate a range of potential loss resulting from any reduction in available coverage from the Wildfire Fund. 

For existing claims or new claims based on any California electric IOUs’ assets determined to be a cause of fires, including fires of the size and scope of the Eaton fire, payments of these claims could have a material adverse effect on the Wildfire Fund, including potentially exhausting the fund, and on SDG&E’s and Sempra’s financial condition and results of operations up to the carrying value of our Wildfire Fund asset, with additional potential material exposure if SDG&E’s equipment is determined to be a cause of a fire.

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2025 Wildfire Legislation. We describe the 2025 Wildfire Legislation that was signed into law in September 2025 in Note 1 of the Notes to Condensed Consolidated Financial Statements. The 2025 Wildfire Legislation established, among other things, the Continuation Account, a new state-administered account with up to $18.0 billion of additional liquidity to reimburse catastrophic wildfire-related claims incurred by large California electric IOUs, including SDG&E, if the Wildfire Fund is depleted. The funds in the account would only be available for claims arising from wildfires that ignited