Company: SREA
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0001032208-25-000012
Chunk: 254

Company: SEMPRA
Filing Date: 2025-02-25
Form: 10-K
Item: Item 1
Chunk 254
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 associated with refundable programs, which are fully offset in O&M

In 2024 compared to 2023, SDG&E’s cost of natural gas decreased by $290 million to $242 million primarily due to:

▪$252 million lower average natural gas prices 

▪$38 million lower volumes driven by weather

2024 Form 10-K  |  78

Operation and Maintenance

In 2024 compared to 2023, SDG&E’s O&M decreased by $154 million (8%) to $1.7 billion due to:

▪$165 million lower expenses associated with refundable programs, which costs are recovered in revenue

Offset by:

▪$14 million higher non-refundable operating costs

Other Income, Net

In 2024 compared to 2023, SDG&E’s other income, net, decreased by $7 million (7%) to $90 million primarily due to:

▪$26 million charge in 2024, comprised of $7 million of AFUDC equity and $19 million of net regulatory interest, relating to the FERC order finding that the TO5 adder refund provision has been triggered, requiring SDG&E to refund customers the California ISO adder retroactively from June 1, 2019

▪$6 million lower AFUDC equity

Offset by:

▪$23 million increase from a $4 million credit in 2024 compared to $19 million cost in 2023 for the non-service components of net periodic benefit cost

Interest Expense

In 2024 compared to 2023, SDG&E’s interest expense increased by $28 million (6%) to $525 million from higher debt balances from debt issuances.

Income Taxes

INCOME TAX EXPENSE (BENEFIT) AND EFFECTIVE INCOME TAX RATES(Dollars in millions) Years ended December 31, 202420232022SDG&E:Income tax expense (benefit)$153 $(26)$182Income before income taxes$1,044 $910 $1,097Effective income tax rate15 %(3)%17 %

In April 2023, the IRS issued Revenue Procedure 2023-15, which provides a safe harbor method of accounting for gas repairs expenditures. SDG&E elected this change in tax accounting method in Sempra’s consolidated 2023 income tax return filing. 

SDG&E records regulatory liabilities for benefits that will be flowed through to customers in the future