XML 64 R26.htm IDEA: XBRL DOCUMENT v3.22.0.1
REVENUES
 12 Months Ended
Dec. 31, 2021
Revenue from Contract with Customer [Abstract]  
REVENUES REVENUESThe following table disaggregates our revenues from contracts with customers by major service line and market and provides a reconciliation to total revenues by segment. The majority of our revenue is recognized over time.
DISAGGREGATED REVENUES
(Dollars in millions)
SDG&ESoCalGasSempra InfrastructureSempra RenewablesConsolidating adjustments and Parent and otherSempra
Year ended December 31, 2021
By major service line:
Utilities$5,144 $5,424 $81 $— $(109)$10,540 
Energy-related businesses— — 1,165 — (29)1,136 
Revenues from contracts with customers$5,144 $5,424 $1,246 $— $(138)$11,676 
By market:
Gas$790 $5,424 $856 $— $(101)$6,969 
Electric4,354 — 390 — (37)4,707 
Revenues from contracts with customers$5,144 $5,424 $1,246 $— $(138)$11,676 
Revenues from contracts with customers$5,144 $5,424 $1,246 $— $(138)$11,676 
Utilities regulatory revenues360 91 — — — 451 
Other revenues— — 751 — (21)730 
Total revenues$5,504 $5,515 $1,997 $— $(159)$12,857 
Year ended December 31, 2020
By major service line:
Utilities$4,920 $4,571 $58 $— $(94)$9,455 
Energy-related businesses— — 854 — 1 855 
Revenues from contracts with customers$4,920 $4,571 $912 $— $(93)$10,310 
By market:
Gas$692 $4,571 $623 $— $(90)$5,796 
Electric4,228 — 289 — (3)4,514 
Revenues from contracts with customers$4,920 $4,571 $912 $— $(93)$10,310 
Revenues from contracts with customers$4,920 $4,571 $912 $— $(93)$10,310 
Utilities regulatory revenues393 177 — — — 570 
Other revenues— — 488 — 2 490 
Total revenues$5,313 $4,748 $1,400 $— $(91)$11,370 
Year ended December 31, 2019
By major service line:
Utilities$4,819 $4,367 $73 $— $(75)$9,184 
Energy-related businesses— — 951 5 1 957 
Revenues from contracts with customers$4,819 $4,367 $1,024 $5 $(74)$10,141 
By market:
Gas$587 $4,367 $711 $— $(69)$5,596 
Electric4,232 — 313 5 (5)4,545 
Revenues from contracts with customers$4,819 $4,367 $1,024 $5 $(74)$10,141 
Revenues from contracts with customers$4,819 $4,367 $1,024 $5 $(74)$10,141 
Utilities regulatory revenues106 158 — — — 264 
Other revenues— — 430 5 (11)424 
Total revenues$4,925 $4,525 $1,454 $10 $(85)$10,829 
REVENUES FROM CONTRACTS WITH CUSTOMERS
Our revenues from contracts with customers are primarily related to the transmission, distribution and storage of natural gas and the generation, transmission and distribution of electricity through our regulated utilities. We also provide other midstream and renewable energy-related services. We assess our revenues on a contract-by-contract basis as well as a portfolio basis to determine the nature, amount, timing and uncertainty, if any, of revenues being recognized.
We generally recognize revenues when performance of the promised commodity service is provided to our customers and we invoice our customers for an amount that reflects the consideration we are entitled to in exchange for those services. We consider the delivery and transmission of natural gas and electricity and providing of natural gas storage services as ongoing and integrated services. Generally, natural gas or electricity services are received and consumed by the customer simultaneously. Our performance obligations related to these services are satisfied over time and represent a series of distinct services that are substantially the same and that have the same pattern of transfer to the customers. We recognize revenue based on units delivered, as the satisfaction of our performance obligations can be directly measured by the amount of natural gas or electricity delivered to the customer. In most cases, the right to consideration from the customer directly corresponds to the value transferred to the customer and we recognize revenue in the amount that we have the right to invoice.
The payment terms in our customer contracts vary. Typically, we have an unconditional right to customer payments, which are due after the performance obligation to the customer is satisfied. The term between invoicing and when payment is due is typically between 10 and 90 days.
We exclude sales and usage-based taxes from revenues. In addition, SDG&E and SoCalGas pay franchise fees to operate in various municipalities. SDG&E and SoCalGas bill these franchise fees to their customers based on a CPUC-authorized rate. These franchise fees, which are required to be paid regardless of SDG&E’s and SoCalGas’ ability to collect from the customer, are accounted for on a gross basis and reflected in utilities revenues from contracts with customers and operating expense.
Utilities Revenues
Utilities revenues represent the majority of our consolidated revenues from contracts with customers and include:
▪The transmission, distribution and storage of natural gas at:
◦SDG&E 
◦SoCalGas
◦Sempra Infrastructure’s Ecogas
▪The generation, transmission and distribution of electricity at SDG&E.
Utilities revenues are derived from and recognized upon the delivery of natural gas or electricity services to customers. Amounts that we bill our customers are based on tariffs set by regulators within the respective state or country. For SDG&E and SoCalGas, which follow the provisions of U.S. GAAP governing rate-regulated operations as we discuss in Note 1, amounts that we bill to customers also include adjustments for previously recognized regulatory revenues.
SDG&E, SoCalGas and Ecogas recognize revenues based on regulator-approved revenue requirements, which allow the utilities to recover their reasonable operating costs and provides the opportunity to realize their authorized rates of return on their investments. While SDG&E’s and SoCalGas’ revenues are not affected by actual sales volumes, the pattern of their revenue recognition during the year is affected by seasonality. SDG&E and SoCalGas recognize annual authorized revenue for customers using seasonal factors established in applicable proceedings. This generally results in a significant portion of operating revenues being recognized in the third quarter of each year for SDG&E and in the first and fourth quarters of each year for SoCalGas.
SDG&E has an arrangement to provide the California ISO with the ability to control its high-voltage transmission lines for prices approved by the FERC. Revenue is recognized over time as access is provided to the California ISO.
Factors that can affect the amount, timing and uncertainty of revenues and cash flows include weather, seasonality and timing of customer billings, which may result in unbilled revenues that can vary significantly from month to month and generally approximate one-half month’s deliveries.
SDG&E and SoCalGas recognize revenues from the sale of allocated California GHG emissions allowances at quarterly auctions administered by CARB. GHG allowances are delivered to CARB in advance of the quarterly auctions, and SDG&E and SoCalGas have the right to payment when the GHG allowances are sold at auction. GHG revenue is recognized on a point in time basis within the quarter the auction is held. SDG&E and SoCalGas balance costs and revenues associated with the GHG program through regulatory balancing accounts.
Energy-Related Businesses Revenues
Revenues at Sempra Infrastructure typically represent revenues from long-term, U.S. dollar-based contracts with customers for the sale of natural gas and LNG, as well as storage and transportation of natural gas. Invoiced amounts are based on the volume of natural gas delivered and contracted prices.
We recognize storage revenue from firm capacity reservation agreements, under which we collect a fee for reserving storage capacity for customers in our storage facilities. Under these firm agreements, customers pay a monthly fixed reservation fee based
on the storage capacity reserved rather than the actual volumes stored. For the fixed-fee component, revenue is recognized on a straight-line basis over the term of the contract. We bill customers for any capacity used in excess of the contracted capacity and such revenues are recognized in the month of occurrence. We also recognize revenue for interruptible storage services. As we discuss in Note 5, in February 2019, Sempra Infrastructure completed the sale of its non-utility natural gas storage assets in the southeast U.S. (comprised of Mississippi Hub and Bay Gas).
We generate pipeline transportation revenues from firm agreements, under which customers pay a fee for reserving transportation capacity. Revenue is recognized when the volumes are delivered to the customers’ agreed upon delivery point. We recognize revenues for our stand-ready obligation to provide capacity and transportation services throughout the contractual delivery period, as the benefits are received and consumed simultaneously as customers utilize pipeline capacity for the transport and receipt of natural gas and LPG. Invoiced amounts are based on a variable usage fee and a fixed capacity charge, adjusted for the Consumer Price Index, the effects of any foreign currency translation and the actual quantity of commodity transported.
Sempra Infrastructure and, previously, Sempra Renewables develop, invest in and operate solar and wind facilities that have long-term PPAs to sell the electricity and the related green energy attributes they generate to customers, generally load serving entities, and also for Sempra Infrastructure, industrial and other customers. Load serving entities will sell electric service to their end-users and wholesale customers immediately upon receipt of our power delivery, and industrial and other customers immediately consume the electricity to run their facilities, and thus, we recognize the revenue under the PPAs as the electricity is generated and delivered. We invoice customers based on the volume of energy delivered at rates pursuant to the PPAs. As we discuss in Note 5, in April 2019, Sempra Renewables completed the sale of its remaining wind assets and investments.
TdM is a natural gas-fired power plant that generates revenues from selling electricity and/or resource adequacy to the California ISO and to governmental, public utility and wholesale power marketing entities, as the power is delivered at the interconnection point.
Sempra Infrastructure sells natural gas to the CFE and other customers under supply agreements. Sempra Infrastructure recognizes the revenue from the sale of natural gas upon transfer of the natural gas via pipelines to customers at the agreed upon delivery points, and in the case of the CFE, at its thermoelectric power plants.
Remaining Performance Obligations    
We do not disclose information about remaining performance obligations for (a) contracts with an original expected length of one year or less, (b) variable consideration recognized at the amount at which we have the right to invoice for services performed, or (c) variable consideration allocated to wholly unsatisfied performance obligations.
For contracts greater than one year, at December 31, 2021, we expect to recognize revenue related to the fixed fee component of the consideration as shown below. Sempra’s remaining performance obligations primarily relate to capacity agreements for natural gas storage and transportation at Sempra Infrastructure. SoCalGas did not have any remaining performance obligations at December 31, 2021.
REMAINING PERFORMANCE OBLIGATIONS(1)
(Dollars in millions)
Sempra SDG&E
2022$368 $4 
2023367 4 
2024365 4 
2025362 4 
2026361 4 
Thereafter4,289 63 
Total revenues to be recognized
$6,112 $83 
(1)    Excludes intercompany transactions.
Contract Liabilities from Revenues from Contracts with Customers
From time to time, we receive payments in advance of satisfying the performance obligations associated with customer contracts. We defer such revenues as contract liabilities and recognize them in earnings as the performance obligations are satisfied.
Activities within Sempra’s and SDG&E’s contract liabilities are presented below. There were no contract liabilities at SoCalGas in 2021, 2020 or 2019.
CONTRACT LIABILITIES
(Dollars in millions)
202120202019
Sempra:
Contract liabilities at January 1$(207)$(163)$(70)
Revenue from performance obligations satisfied during reporting period52 4 2 
Payments received in advance(123)(48)(95)
Contract liabilities at December 31(1)
$(278)$(207)$(163)
SDG&E:
Contract liabilities at January 1$(87)$(91)$— 
Revenue from performance obligations satisfied during reporting period4 4 1 
Payments received in advance— — (92)
Contract liabilities at December 31(2)
$(83)$(87)$(91)
(1)     Balances at December 31, 2021, 2020 and 2019 include $116, $52 and $4, respectively, in Other Current Liabilities and $162, $155 and $159, respectively, in Deferred Credits and Other.
(2)     Balances at December 31, 2021, 2020 and 2019 include $4, $4 and $4, respectively, in Other Current Liabilities and $79, $83 and $87, respectively, in Deferred Credits and Other.
Receivables from Revenues from Contracts with Customers
The table below shows receivable balances associated with revenues from contracts with customers on the Consolidated Balance Sheets.
RECEIVABLES FROM REVENUES FROM CONTRACTS WITH CUSTOMERS
(Dollars in millions)
December 31,
202120202019
Sempra:
Accounts receivable – trade, net$1,886 $1,447 $1,163 
Accounts receivable – other, net19 12 16 
Due from unconsolidated affiliates – current(1)
2 3 5 
Other long-term assets70 — — 
Total$1,977 $1,462 $1,184 
SDG&E:
Accounts receivable – trade, net$715 $573 $398 
Accounts receivable – other, net9 8 5 
Due from unconsolidated affiliates – current(1)
2 2 2 
Other long-term assets25 — — 
Total$751 $583 $405 
SoCalGas:
Accounts receivable – trade, net$1,084 $786 $710 
Accounts receivable – other, net10 4 11 
Other long-term assets45 — — 
Total$1,139 $790 $721 
(1)     Amount is presented net of amounts due to unconsolidated affiliates on the Consolidated Balance Sheets, when right of offset exists.

In connection with the COVID-19 pandemic and at the direction of the CPUC, SDG&E and SoCalGas implemented certain measures to assist customers, including suspending service disconnections due to nonpayment for all customers (except for SoCalGas’ noncore customers), waiving late payment fees, and offering flexible payment plans. At the CPUC’s direction, SDG&E and SoCalGas are automatically enrolling residential and small business customers with past-due balances in long-term repayment plans.
In 2021, SDG&E and SoCalGas applied, on behalf of their customers, for financial assistance from the California Department of Community Services and Development under the California Arrearage Payment Program, which provided funds of $63 million and $79 million for SDG&E and SoCalGas, respectively. In the first quarter of 2022, SDG&E and SoCalGas received and will apply the amounts directly to eligible customer accounts to reduce past due balances.
REVENUES FROM SOURCES OTHER THAN CONTRACTS WITH CUSTOMERS
Certain of our revenues are derived from sources other than contracts with customers and are accounted for under other accounting standards outside the scope of ASC 606.
Utilities Regulatory Revenues
Alternative Revenue Programs
We recognize revenues from alternative revenue programs when the regulator-specified conditions for recognition have been met and adjust these revenues as they are recovered or refunded through future utility service.
Decoupled revenues. As discussed earlier, the regulatory framework requires SDG&E and SoCalGas to recover authorized revenue based on estimated annual demand forecasts approved in regular proceedings before the CPUC. However, actual demand for natural gas and electricity will generally vary from CPUC-approved forecasted demand due to the impacts from weather volatility, energy efficiency programs, rooftop solar and other factors affecting consumption. The CPUC regulatory framework provides for SDG&E and SoCalGas to use a “decoupling” mechanism, which allows SDG&E and SoCalGas to record revenue shortfalls or excess revenues resulting from any difference between actual and forecasted demand to be recovered or refunded in authorized revenue in a subsequent period based on the nature of the account.
Incentive mechanisms. The CPUC applies performance-based measures and incentive mechanisms to all California IOUs, under which SDG&E and SoCalGas have earnings potential above authorized base margins if they achieve or exceed specific performance and operating goals. Generally, for performance-based awards, if performance is above or below specific benchmarks, the utility is eligible for financial awards or subject to financial penalties.
Incentive awards are included in revenues when we receive required CPUC approval of the award, the timing of which may not be consistent from year to year. We would record penalties for results below the specified benchmarks against revenues when we believe it is probable that the CPUC would assess a penalty.
Other Cost-Based Regulatory Recovery
The CPUC, and the FERC as it relates to SDG&E, authorize SDG&E and SoCalGas to collect revenue requirements for operating costs and capital related costs (such as depreciation, taxes and return on rate base) from customers, including:
▪costs to purchase natural gas and electricity;
▪costs associated with administering public purpose, demand response, and customer energy efficiency programs;
▪other programmatic activities, such as gas distribution, gas transmission, gas storage integrity management and wildfire mitigation; and
▪costs associated with third party liability insurance premiums.
Authorized costs are recovered as the commodity service is delivered. To the extent authorized amounts collected vary from actual costs, the differences are generally recovered or refunded within a subsequent period based on the nature of the balancing account mechanism. In general, the revenue recognition criteria for balanced costs billed to customers are met at the time the costs are incurred. Because these costs are substantially recovered in rates through a balancing account mechanism, changes in these costs are reflected as changes in revenues. The CPUC and the FERC may impose various review procedures before authorizing recovery or refund for programs authorized, including limitations on the total cost of the program, revenue requirement limits or reviews of costs for reasonableness. These procedures could result in disallowances of recovery from ratepayers.
We discuss balancing accounts and their effects further in Note 4.
Other Revenues
Sempra Infrastructure generates lease revenues from certain of its natural gas and ethane pipelines, compressor stations, LPG storage facilities, a rail facility and liquid fuels terminals. Certain PPAs at Sempra Renewables were accounted for as operating leases prior to sale of its wind assets in April 2019. We discuss the recognition of lease income in Note 16 of the Notes to Consolidated Financial Statements.
Sempra Infrastructure has an agreement with Tangguh PSC to supply LNG to the ECA Regas Facility. Under the terms of the agreement, Tangguh PSC must either deliver the contracted number of cargoes or pay a diversion fee for non-delivery of LNG cargoes.
Sempra Infrastructure also recognizes other revenues associated with derivatives related to the sales of natural gas and electricity under short-term and long-term contracts and into the spot market and other competitive markets. Revenues include the net realized gains and losses on physical and derivative settlements and net unrealized gains and losses from the change in fair values of these derivatives.