Company: SREA
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001032208-25-000027
Chunk: 258

Company: SEMPRA
Filing Date: 2025-05-08
Form: 10-Q
Item: Item 8
Chunk 258
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4, the CPUC approved an FD in the 2024 GRC, effective retroactive to January 1, 2024, for which SoCalGas recorded the retroactive impacts in the fourth quarter of 2024. SoCalGas’ authorized base revenues for the first quarter of 2025 are based on the revenues authorized for the 2024 test year plus the amount authorized for attrition for 2025. We provide additional information on the 2024 GRC FD in Note 4 of the Notes to Condensed Consolidated Financial Statements in this report and in Note 4 of the Notes to Consolidated Financial Statements in the Annual Report.

RESULTS OF OPERATIONS

RESULTS OF OPERATIONS(Dollars in millions)

In the three months ended March 31, 2025 compared to the same period in 2024, the increase in earnings of $84 million (23%) was primarily due to:

▪$54 million higher income tax benefits primarily from flow-through items, including gas repairs tax benefits, which in the first three quarters of 2024 were recorded as a regulatory liability that was released in the fourth quarter of 2024 as a result of the 2024 GRC FD

▪$38 million higher CPUC base operating margin, net of operating expenses and $8 million lower authorized cost of capital. In the first three quarters of 2024, SoCalGas recorded CPUC-authorized base revenues based on 2023 authorized levels

Offset by:

▪$9 million higher net interest expense

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SIGNIFICANT CHANGES IN REVENUES AND COSTS

Natural Gas Revenues and Cost of Natural Gas

In the three months ended March 31, 2025 and 2024, SoCalGas’ average cost of natural gas per thousand cubic feet was $4.23 and $4.50, respectively. The average cost of natural gas sold at SoCalGas is impacted by market prices, as well as transportation and other charges. 

In the three months ended March 31, 2025 compared to the same period in 2024, SoCalGas’ natural gas revenues increased by $215 million (12%) to $2.0 billion primarily due to:

▪$147 million higher CPUC-authorized revenues, including certain incremental and balanced capital projects that are now in CPUC-authorized base revenues as a result of the 2024 GRC FD offset by $11 million lower authorized cost of capital

▪