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<div style="font-size:12pt"><p>NOTE 8. INCOME TAXES <br />Reconciliation of net U.S. statutory federal income tax rates to the effective income tax rates are as follows:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="647" align="left" colspan="7" style="border-top: 1px solid #000000;" height="19"><b>RECONCILIATION OF FEDERAL INCOME TAX RATES TO EFFECTIVE INCOME TAX RATES</b></td></tr><tr><td width="647" align="left" height="19" colspan="7"><i> </i></td></tr><tr><td height="14" width="344" align="left"> </td><td width="303" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">Years ended December 31,</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="344"> </td><td width="101" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="101" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008(1)</td><td width="101" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007(1)</td></tr><tr><td height="16" style="border-top: 1px solid #000000;" align="left" width="344"><b>Sempra Energy Consolidated</b></td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" width="344" align="left">U.S. federal statutory income tax rate</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td></tr><tr><td height="16" width="344" align="left">Utility depreciation</td><td height="16" width="75" align="right"> 3 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 3 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 3 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">State income taxes, net of federal income tax benefit</td><td height="16" width="75" align="right"> 3 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 3 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Tax credits</td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Allowance for equity funds used during construction</td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Non-U.S. earnings taxed at lower statutory income tax rates</td><td height="16" width="75" align="right"> (5)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Resolution of Internal Revenue Service audits</td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Utility repair allowance</td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Self-developed software expenditures</td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Mexican foreign exchange and inflation effects</td><td height="16" width="75" align="right"> 1 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Variable interest entities</td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 1 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Noncontrolling interests</td><td height="16" width="75" align="right"> 1 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Other, net</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> - </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> - </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (1)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="344">    Effective income tax rate</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 29 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 30 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 34 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td></tr><tr><td height="16" style="border-top: 3px solid #000000;" align="left" width="344"><b>SDG&E</b></td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" width="344" align="left">U.S. federal statutory income tax rate</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td></tr><tr><td height="16" width="344" align="left">Depreciation</td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 5 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">State income taxes, net of federal income tax benefit</td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 5 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 5 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Allowance for equity funds used during construction</td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Resolution of Internal Revenue Service audits</td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Utility repair allowance</td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Self-developed software expenditures</td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Regulatory reserve release</td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> - </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Variable interest entities</td><td height="16" width="75" align="right"> (2)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 1 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Other, net</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (2)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="344">    Effective income tax rate</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 32 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 36 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 33 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td></tr><tr><td height="16" style="border-top: 3px solid #000000;" align="left" width="344"><b>PE</b></td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" width="344" align="left">U.S. federal statutory income tax rate</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td></tr><tr><td height="16" width="344" align="left">Depreciation</td><td height="16" width="75" align="right"> 6 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 5 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 6 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">State income taxes, net of federal income tax benefit</td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 5 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Self-developed software expenditures</td><td height="16" width="75" align="right"> (6)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Other, net</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (4)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (5)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (5)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="344">    Effective income tax rate</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 35 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 36 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 40 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td></tr><tr><td height="16" style="border-top: 3px solid #000000;" align="left" width="344"><b>SoCalGas</b></td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" width="344" align="left">U.S. federal statutory income tax rate</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td><td height="16" width="75" align="right"> 35 </td><td height="16" width="26" align="right">%</td></tr><tr><td height="16" width="344" align="left">Depreciation</td><td height="16" width="75" align="right"> 6 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 6 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 6 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">State income taxes, net of federal income tax benefit</td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 4 </td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> 5 </td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Self-developed software expenditures</td><td height="16" width="75" align="right"> (6)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (3)</td><td height="16" width="26" align="right"> </td><td height="16" width="75" align="right"> (1)</td><td height="16" width="26" align="right"> </td></tr><tr><td height="16" width="344" align="left">Other, net</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (5)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (6)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (4)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="344">    Effective income tax rate</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 34 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 36 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 41 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">%</td></tr><tr><td width="647" align="left" colspan="7" style="border-top: 3px solid #000000;" height="16"><i>(1) As adjusted at Sempra Energy, SDG&E and PE for the retrospective adoption of ASC 810 (SFAS 160).</i></td></tr></table><p>The geographic components of Income from Continuing Operations Before Income Taxes and Equity Earnings of Certain Unconsolidated Subsidiaries at Sempra Energy are as follows:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td height="14" width="301" align="left"> </td><td width="267" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">Years ended December 31,</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="301"><i>(Dollars in millions)</i></td><td width="89" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="89" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008(1)</td><td width="89" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007(1)</td></tr><tr><td height="16" style="border-top: 1px solid #000000;" align="left" width="301">U.S.</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="14">$</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="75"> 1,007 </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="14">$</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="75"> 1,199 </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="14">$</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="75"> 1,275 </td></tr><tr><td height="16" width="301" align="left">Non-U.S.</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="14"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 469 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="14"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 244 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="14"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 268 </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="301">Total</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="14">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 1,476 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="14">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 1,443 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="14">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 1,543 </td></tr><tr><td width="568" align="left" colspan="7" style="border-top: 3px solid #000000;" height="18"><i>(1) As adjusted for the retrospective adoption of ASC 810 (SFAS 160).</i></td></tr></table><p>The components of income tax expense are as follows:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="592" align="left" colspan="7" style="border-top: 1px solid #000000;" height="19"><b>INCOME TAX EXPENSE</b></td></tr><tr><td width="592" align="left" height="19" colspan="7"><i>(Dollars in millions)</i></td></tr><tr><td height="14" width="301" align="left"> </td><td width="291" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">Years ended December 31,</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="301"> </td><td width="97" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="97" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="97" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007 </td></tr><tr><td height="16" style="border-top: 1px solid #000000;" align="left" width="301"><b>Sempra Energy Consolidated</b></td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">Current:</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 39 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> (10)</td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 247 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 40 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 28 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 77 </td></tr><tr><td height="16" width="301" align="left">    Non-U.S.</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 48 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 96 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 51 </td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 127 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 114 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 375 </td></tr><tr><td height="16" width="301" align="left">Deferred:</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 216 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 359 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 124 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 24 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 29 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> (5)</td></tr><tr><td height="16" width="301" align="left">    Non-U.S.</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 58 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (59)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 36 </td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 298 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 329 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 155 </td></tr><tr><td height="16" width="301" align="left">Deferred investment tax credits</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (5)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (6)</td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="301">        Total income tax expense</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 422 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 438 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 524 </td></tr><tr><td height="16" style="border-top: 3px solid #000000;" align="left" width="301"><b>SDG&E</b></td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">Current:</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 70 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 25 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 131 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 34 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 23 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 44 </td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 104 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 48 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 175 </td></tr><tr><td height="16" width="301" align="left">Deferred:</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 75 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 107 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> (24)</td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (2)</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 8 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (14)</td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 73 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 115 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (38)</td></tr><tr><td height="16" width="301" align="left">Deferred investment tax credits</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> - </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (2)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (2)</td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="301">        Total income tax expense</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 177 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 161 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 135 </td></tr><tr><td height="16" style="border-top: 3px solid #000000;" align="left" width="301"><b>PE</b></td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">Current:</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 52 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 28 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 122 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 21 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 21 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 33 </td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 73 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 49 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 155 </td></tr><tr><td height="16" width="301" align="left">Deferred:</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 68 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 89 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 15 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 7 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 6 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (2)</td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 75 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 95 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 13 </td></tr><tr><td height="16" width="301" align="left">Deferred investment tax credits</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="301">        Total income tax expense</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 145 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 141 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 165 </td></tr><tr><td height="16" style="border-top: 3px solid #000000;" align="left" width="301"><b>SoCalGas</b></td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">Current:</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="left"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 52 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 31 </td><td height="16" width="22" align="right">$</td><td height="16" width="75" align="right"> 119 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 22 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 22 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 33 </td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 74 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 53 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 152 </td></tr><tr><td height="16" width="301" align="left">Deferred:</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="75"> </td></tr><tr><td height="16" width="301" align="left">    U.S. Federal</td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 67 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 85 </td><td height="16" width="22" align="right"> </td><td height="16" width="75" align="right"> 14 </td></tr><tr><td height="16" width="301" align="left">    U.S. State</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 6 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> 5 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td></tr><tr><td height="16" width="301" align="left">        Total </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 73 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 90 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> 11 </td></tr><tr><td height="16" width="301" align="left">Deferred investment tax credits</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="75"> (3)</td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="301">        Total income tax expense</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 144 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 140 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="75"> 160 </td></tr></table><p>We show details of accumulated deferred income taxes at December 31 for Sempra Energy, SDG&E, PE and SoCalGas in the tables below:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="669" align="left" colspan="5" style="border-top: 1px solid #000000;" height="19"><b>ACCUMULATED DEFERRED INCOME TAXES FOR SEMPRA ENERGY CONSOLIDATED</b></td></tr><tr><td width="669" align="left" height="19" colspan="5"><i>(Dollars in millions)</i></td></tr><tr><td height="14" width="495" align="left"> </td><td width="174" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">December 31,</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="495"> </td><td width="87" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="87" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td></tr><tr><td height="16" style="border-top: 1px solid #000000;" align="left" width="495">Deferred income tax liabilities:</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="61"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="61"> </td></tr><tr><td height="16" width="495" align="left">    Differences in financial and tax bases of depreciable and amortizable assets</td><td height="16" width="26" align="right">$</td><td height="16" width="61" align="right"> 1,528 </td><td height="16" width="26" align="right">$</td><td height="16" width="61" align="right"> 1,323 </td></tr><tr><td height="16" width="495" align="left">    Regulatory balancing accounts</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 501 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 632 </td></tr><tr><td height="16" width="495" align="left">    Unrealized revenue</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 25 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 22 </td></tr><tr><td height="16" width="495" align="left">    Loss on reacquired debt</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 18 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 21 </td></tr><tr><td height="16" width="495" align="left">    Property taxes</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 34 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 31 </td></tr><tr><td height="16" width="495" align="left">    Difference in financial and tax bases of partnership interests</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 85 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 46 </td></tr><tr><td height="16" width="495" align="left">    Other</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="61"> 61 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="61"> 15 </td></tr><tr><td height="16" width="495" align="left">        Total deferred income tax liabilities</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="61"> 2,252 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="61"> 2,090 </td></tr><tr><td height="16" width="495" align="left">Deferred income tax assets:</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="61"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="61"> </td></tr><tr><td height="16" width="495" align="left">    Investment tax credits</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 35 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 37 </td></tr><tr><td height="16" width="495" align="left">    Equity losses</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 3 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 6 </td></tr><tr><td height="16" width="495" align="left">    Net operating losses of separate state and foreign entities</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 21 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 77 </td></tr><tr><td height="16" width="495" align="left">    Compensation-related items</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 177 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 193 </td></tr><tr><td height="16" width="495" align="left">    Postretirement benefits</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 510 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 609 </td></tr><tr><td height="16" width="495" align="left">    Other deferred assets</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 41 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 4 </td></tr><tr><td height="16" width="495" align="left">    State income taxes</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 50 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 35 </td></tr><tr><td height="16" width="495" align="left">    Bad debt allowance</td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 7 </td><td height="16" width="26" align="right"> </td><td height="16" width="61" align="right"> 7 </td></tr><tr><td height="16" width="495" align="left">    Litigation and other accruals not yet deductible</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="61"> 129 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="61"> 233 </td></tr><tr><td height="16" width="495" align="left">        Deferred income tax assets before valuation allowances</td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="61"> 973 </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;" align="right" width="61"> 1,201 </td></tr><tr><td height="16" width="495" align="left">        Less: valuation allowances</td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="61"> 29 </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="61"> 26 </td></tr><tr><td height="16" width="495" align="left">            Total deferred income tax assets</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="61"> 944 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="26"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="61"> 1,175 </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="495">Net deferred income tax liability</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="61"> 1,308 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="26">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="61"> 915 </td></tr><tr><td width="669" align="left" colspan="5" style="border-top: 3px solid #000000;" height="18"><i>Our policy is to show deferred taxes of VIEs on a net basis, including valuation allowances. See table "Amounts Associated with Variable Interest Entities" in Note 1 for further information on VIEs.</i></td></tr></table><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="731" align="left" colspan="13" style="border-top: 1px solid #000000;" height="19"><b>ACCUMULATED DEFERRED INCOME TAXES FOR SDG&E, PE AND SOCALGAS</b></td></tr><tr><td width="731" align="left" height="19" colspan="13"><i>(Dollars in millions)</i></td></tr><tr><td height="14" width="299" align="left"> </td><td width="144" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">SDG&E</td><td width="144" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">PE</td><td width="144" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">SoCalGas</td></tr><tr><td height="14" width="299" align="left"> </td><td width="144" align="center" colspan="4" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">December 31,</td><td width="144" align="center" colspan="4" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">December 31,</td><td width="144" align="center" colspan="4" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">December 31,</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="299"> </td><td width="72" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="72" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="72" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="72" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="72" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="72" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td></tr><tr><td height="16" style="border-top: 1px solid #000000;" align="left" width="299">Deferred income tax liabilities:</td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td></tr><tr><td height="16" width="299" align="left">    Differences in financial and tax bases of</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="left"> </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="left"> </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="left"> </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="left"> </td></tr><tr><td height="16" width="299" align="left">        utility plant and other assets</td><td height="16" width="18" align="left">$</td><td height="16" width="54" align="right"> 737 </td><td height="16" width="18" align="left">$</td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 625 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18">$</td><td height="16" width="54" align="right"> 360 </td><td height="16" width="18" align="left">$</td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 278 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18">$</td><td height="16" width="54" align="right"> 363 </td><td height="16" width="18" align="left">$</td><td height="16" width="54" align="right"> 281 </td></tr><tr><td height="16" width="299" align="left">    Regulatory balancing accounts</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 190 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 229 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 322 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 413 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 322 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 413 </td></tr><tr><td height="16" width="299" align="left">    Loss on reacquired debt</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 8 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 10 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 11 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 13 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 11 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 13 </td></tr><tr><td height="16" width="299" align="left">    Property taxes</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 24 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 20 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 12 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 13 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 12 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 13 </td></tr><tr><td height="16" width="299" align="left">    Other</td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> 16 </td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> - </td><td height="16" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> - </td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> - </td><td height="16" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> - </td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> - </td></tr><tr><td height="16" width="299" align="left">        Total deferred income tax liabilities</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 975 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 884 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 705 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 717 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 708 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 720 </td></tr><tr><td height="16" width="299" align="left">Deferred income tax assets:</td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;" align="left" width="54"> </td></tr><tr><td height="16" width="299" align="left">    Postretirement benefits</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 152 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 173 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 283 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 357 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 285 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 359 </td></tr><tr><td height="16" width="299" align="left">    Investment tax credits</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 18 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 18 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 19 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 21 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 19 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 21 </td></tr><tr><td height="16" width="299" align="left">    Compensation-related items</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 17 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 14 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 50 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 49 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 51 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 49 </td></tr><tr><td height="16" width="299" align="left">    State income taxes</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 25 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 22 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 16 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 17 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 16 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 16 </td></tr><tr><td height="16" width="299" align="left">    Litigation and other accruals not yet deductible</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 25 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 37 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 33 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 74 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 32 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 75 </td></tr><tr><td height="16" width="299" align="left">    Hedging transaction</td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> - </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> - </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 11 </td><td height="16" width="18" align="left"> </td><td height="16" style="border-right: 1px solid #000000;" align="right" width="54"> 16 </td><td height="16" style="border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" width="54" align="right"> 11 </td><td height="16" width="18" align="left"> </td><td height="16" width="54" align="right"> 16 </td></tr><tr><td height="16" width="299" align="left">    Other</td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> 5 </td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 9 </td><td height="16" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> 15 </td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 20 </td><td height="16" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> 8 </td><td height="16" style="border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-bottom: 1px solid #000000;" align="right" width="54"> 11 </td></tr><tr><td height="16" width="299" align="left">        Total Deferred income tax assets </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 242 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 273 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 427 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 554 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 422 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="left" width="18"> </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" align="right" width="54"> 547 </td></tr><tr><td height="16" style="border-bottom: 3px solid #000000;" align="left" width="299">Net deferred income tax liability</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="54"> 733 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 611 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="18">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="54"> 278 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="54"> 163 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="18">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="54"> 286 </td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="16" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="54"> 173 </td></tr><tr><td width="731" align="left" colspan="13" style="border-top: 3px solid #000000;" height="18"><i>Our policy is to show deferred taxes of VIEs on a net basis, including valuation allowances. See table "Amounts Associated with Variable Interest Entities" in Note 1 for further information on VIEs.</i></td></tr></table><p>The net deferred income tax liabilities are recorded on the Consolidated Balance Sheets at December 31 as follows:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="713" align="left" colspan="17" style="border-top: 1px solid #000000;" height="17"><b>NET DEFERRED INCOME TAX LIABILITY</b></td></tr><tr><td width="713" align="left" height="17" colspan="17"><i>(Dollars in millions)</i></td></tr><tr><td height="14" width="151" align="left"> </td><td width="148" align="center" height="14" colspan="4">Sempra Energy</td><td width="69" align="center" height="14" colspan="2"> </td><td width="69" align="center" height="14" colspan="2"> </td><td width="69" align="center" height="14" colspan="2"> </td><td width="69" align="center" height="14" colspan="2"> </td><td width="69" align="center" height="14" colspan="2"> </td><td width="69" align="center" height="14" colspan="2"> </td></tr><tr><td height="14" width="151" align="left"> </td><td width="148" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">Consolidated</td><td width="138" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">SDG&E</td><td width="138" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">PE</td><td width="138" align="center" colspan="4" style="border-bottom: 1px solid #000000;" height="14">SoCalGas</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="151"> </td><td width="79" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="69" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td></tr><tr><td height="17" style="border-top: 1px solid #000000;" align="left" width="151">Current (asset) liability</td><td height="17" style="border-top: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="57"> (10)</td><td height="17" style="border-top: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> (31)</td><td height="17" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="47"> (41)</td><td height="17" style="border-top: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> (17)</td><td height="17" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="47"> 5 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 6 </td><td height="17" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="47"> 6 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="22">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="47"> 6 </td></tr><tr><td height="17" width="151" align="left">Noncurrent liability</td><td height="17" style="border-bottom: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="57"> 1,318 </td><td height="17" style="border-bottom: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 946 </td><td height="17" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="47"> 774 </td><td height="17" style="border-bottom: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 628 </td><td height="17" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="47"> 273 </td><td height="17" style="border-bottom: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 157 </td><td height="17" style="border-bottom: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="47"> 280 </td><td height="17" style="border-bottom: 1px solid #000000;" align="left" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="47"> 167 </td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="151">Total</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="57"> 1,308 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 915 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="47"> 733 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 611 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="47"> 278 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 163 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="47"> 286 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="left" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="47"> 173 </td></tr></table><p>At December 31, 2009, Sempra Energy had established a valuation allowance against a portion of its total deferred income tax assets, as described above. A valuation allowance is recorded when, based on more-likely-than-not criteria, negative evidence outweighs positive evidence with regard to our ability to realize a deferred tax asset in the future. At both Sempra Energy and SDG&E, deferred income taxes for variable interest entities are shown on a net basis. Therefore, a valuation allowance of $117 million related to variable interest entities is not reflected in the tables above. Of Sempra Energy’s total valuation allowance of $29 million, $18 million is related to non-U.S. net operating losses, $7 million to other future deductions, and $4 million to U.S. state and local net operating losses. The total valuation allowance, excluding the amount related to variable interest entities, increased during 2009, when compared to 2008, primarily due to the increase in the valuation allowance established for U.S. state and local net operating losses. This increase was offset by a decrease in the valuation allowance established for U.S. state and local capital losses. We believe that it is more likely than not that the remainder of the total deferred income tax asset is realizable. <br />At December 31, 2009, Sempra Energy’s non-U.S. subsidiaries had $46 million of unused net operating losses (NOLs) available to utilize in the future to reduce Sempra Energy’s future non-U.S. income tax expense, which is in Denmark, Netherlands and Spain. The carry forward periods on our non-U.S. unused NOLs are as follows: $18 million does not expire and $28 million expires between 2011and 2023. As of December 31, 2009, $215 million of Mexican subsidiary NOLs, which have been utilized on a consolidated level, are subject to recapture between 2013 and 2015 if the Mexican subsidiary that generated them does not have sufficient taxable income itself to realize them within 5 years. These NOLs expire between 2013 and 2019. Sempra Energy’s U.S. subsidiaries had $100 million of unused U.S. state and local NOLs, primarily in Louisiana, Connecticut, Alabama and Washington D.C. These U.S. state and local NOLs expire between 2010 and 2028. We have not recorded income tax benefits on a portion of these NOLs because they were incurred in jurisdictions where we currently believe they will not be realized, as discussed above. <br />At December 31, 2009, Sempra Energy had not recognized a U.S. deferred income tax liability on $1.5 billion of cumulative undistributed earnings of non-U.S. subsidiaries that we expect to reinvest indefinitely outside the U.S. These earnings have previously been reinvested or will be reinvested in active non-U.S. operations, thus we do not intend to use these earnings as a source of funding for U.S. operations. It is not practical to determine the amount of U.S. income taxes that might be payable if these earnings were eventually distributed. U.S. deferred income taxes will be recorded when it is determined that all, or a part, of these earnings are no longer intended to be reinvested indefinitely. <br />Sempra Commodities recorded synthetic fuels tax credits of $32 million in 2007.<br />Following is a summary of unrecognized tax benefits at December 31:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="755" align="left" colspan="19" style="border-top: 1px solid #000000;" height="17"><b>SUMMARY OF UNRECOGNIZED TAX BENEFITS </b></td></tr><tr><td width="755" align="left" height="17" colspan="19"><i>(Dollars in millions)</i></td></tr><tr><td height="14" width="220" align="left"> </td><td width="189" align="center" height="14" colspan="6">Sempra Energy</td><td height="14" width="18" align="left"> </td><td height="14" width="42" align="left"> </td><td height="14" width="18" align="left"> </td><td height="14" width="41" align="left"> </td><td height="14" width="18" align="left"> </td><td height="14" width="41" align="left"> </td><td height="14" width="18" align="left"> </td><td height="14" width="37" align="left"> </td><td height="14" width="18" align="left"> </td><td height="14" width="36" align="left"> </td><td height="14" width="18" align="left"> </td><td height="14" width="41" align="left"> </td></tr><tr><td height="14" width="220" align="left"> </td><td width="189" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">Consolidated</td><td width="178" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">SDG&E</td><td width="168" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">PE/SoCalGas</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="220"> </td><td width="61" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="63" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="65" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007 </td><td width="60" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="59" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="59" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007 </td><td width="55" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="54" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="59" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007 </td></tr><tr><td height="14" style="border-top: 1px solid #000000;" align="left" width="220"> </td><td height="14" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="43"> </td><td height="14" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="45"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="18"> </td><td height="14" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="center" width="47"> </td><td height="14" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="42"> </td><td height="14" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="41"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="18"> </td><td height="14" style="border-top: 1px solid #000000;border-right: 1px solid #000000;" align="center" width="41"> </td><td height="14" style="border-top: 1px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="37"> </td><td height="14" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="36"> </td><td height="14" style="border-top: 1px solid #000000;" align="left" width="18"> </td><td height="14" style="border-top: 1px solid #000000;" align="center" width="41"> </td></tr><tr><td height="18" width="220" align="left">Total</td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="43"> 94 </td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="45"> 104 </td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="47"> 131 </td><td height="18" style="border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="42"> 14 </td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="41"> 18 </td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;border-right: 1px solid #000000;" align="right" width="41"> 26 </td><td height="18" style="border-bottom: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="37"> 11 </td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="36"> 19 </td><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #000000;" align="right" width="41"> 40 </td></tr><tr><td height="49" width="220" align="left">Of the total, amounts related to tax positions that, if recognized, in future years, would:</td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="43"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="45"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;border-right: 1px solid #000000;" align="left" width="47"> </td><td height="49" style="border-top: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="42"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="41"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;border-right: 1px solid #000000;" align="left" width="41"> </td><td height="49" style="border-top: 3px solid #000000;border-left: 1px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="37"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="36"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="18"> </td><td height="49" style="border-top: 3px solid #000000;" align="left" width="41"> </td></tr><tr><td height="17" width="220" align="left">   decrease the effective tax rate</td><td height="17" width="18" align="left">$</td><td height="17" width="43" align="right"> (76)</td><td height="17" width="18" align="left">$</td><td height="17" width="45" align="right"> (64)</td><td height="17" width="18" align="left">$</td><td height="17" style="border-right: 1px solid #000000;" align="right" width="47"> (109)</td><td height="17" style="border-left: 1px solid #000000;" align="left" width="18">$</td><td height="17" width="42" align="right"> (13)</td><td height="17" width="18" align="left">$</td><td height="17" width="41" align="right"> (17)</td><td height="17" width="18" align="left">$</td><td height="17" style="border-right: 1px solid #000000;" align="right" width="41"> (23)</td><td height="17" style="border-left: 1px solid #000000;" align="left" width="18">$</td><td height="17" width="37" align="right"> (1)</td><td height="17" width="18" align="left">$</td><td height="17" width="36" align="right"> - </td><td height="17" width="18" align="left">$</td><td height="17" width="41" align="right"> (22)</td></tr><tr><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="220">   increase the effective tax rate</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="43"> 13 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="45"> 17 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;border-right: 1px solid #000000;" align="right" width="47"> 44 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;border-left: 1px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="42"> 13 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="41"> 17 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;border-right: 1px solid #000000;" align="right" width="41"> 22 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;border-left: 1px solid #000000;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="37"> - </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="36"> - </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18">$</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="41"> 21 </td></tr></table><p>Following is a reconciliation of the changes in unrecognized tax benefits for the years ended December 31</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="570" align="left" colspan="7" style="border-top: 1px solid #000000;" height="17"><b>RECONCILIATION OF UNRECOGNIZED TAX BENEFITS</b></td></tr><tr><td width="570" align="left" height="17" colspan="7"><i>(Dollars in millions)</i></td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="243"> </td><td width="110" align="center" colspan="2" style="border-bottom: 1px solid #000000;" height="14">2009 </td><td width="109" align="center" colspan="2" style="border-bottom: 1px solid #000000;" height="14">2008 </td><td width="108" align="center" colspan="2" style="border-bottom: 1px solid #000000;" height="14">2007 </td></tr><tr><td height="17" style="border-top: 1px solid #000000;" align="left" width="243"><b>Sempra Energy Consolidated:</b></td><td height="17" style="border-top: 1px solid #000000;" align="center" width="29"> </td><td height="17" style="border-top: 1px solid #000000;" align="center" width="81"> </td><td height="17" style="border-top: 1px solid #000000;" align="center" width="28"> </td><td height="17" style="border-top: 1px solid #000000;" align="center" width="81"> </td><td height="17" style="border-top: 1px solid #000000;" align="center" width="27"> </td><td height="17" style="border-top: 1px solid #000000;" align="center" width="81"> </td></tr><tr><td height="17" width="243" align="left">Balance as of January 1 </td><td height="17" width="29" align="right">$</td><td height="17" width="81" align="right"> 104 </td><td height="17" width="28" align="right">$</td><td height="17" width="81" align="right"> 131 </td><td height="17" width="27" align="right">$</td><td height="17" width="81" align="right"> 110 </td></tr><tr><td height="17" width="243" align="left">    Increase in prior period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> 44 </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> 23 </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> 53 </td></tr><tr><td height="17" width="243" align="left">    Decrease in prior period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> (3)</td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> (4)</td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (16)</td></tr><tr><td height="17" width="243" align="left">    Increase in current period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> 15 </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> 4 </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> 8 </td></tr><tr><td height="17" width="243" align="left">    Decrease in current period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> (5)</td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (2)</td></tr><tr><td height="17" width="243" align="left">    Settlements with taxing authorities</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> (54)</td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> (38)</td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (16)</td></tr><tr><td height="17" width="243" align="left">    Expirations of statutes of limitations</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="29"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (12)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="28"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (7)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="27"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (6)</td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="243">Balance as of December 31 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="29">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 94 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="28">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 104 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="27">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 131 </td></tr><tr><td height="18" style="border-top: 3px solid #000000;" align="left" width="243"><b>SDG&E:</b></td><td height="18" style="border-top: 3px solid #000000;" align="right" width="29"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="81"> </td><td height="18" style="border-top: 3px solid #000000;" align="right" width="28"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="81"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="27"> </td><td height="18" style="border-top: 3px solid #000000;" align="right" width="81"> </td></tr><tr><td height="17" width="243" align="left">Balance as of January 1 </td><td height="17" width="29" align="right">$</td><td height="17" width="81" align="right"> 18 </td><td height="17" width="28" align="right">$</td><td height="17" width="81" align="right"> 26 </td><td height="17" width="27" align="right">$</td><td height="17" width="81" align="right"> 40 </td></tr><tr><td height="17" width="243" align="left">    Increase in prior period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> 1 </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> 2 </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> 6 </td></tr><tr><td height="17" width="243" align="left">    Decrease in prior period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (9)</td></tr><tr><td height="17" width="243" align="left">    Increase in current period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> 3 </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> 3 </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> 3 </td></tr><tr><td height="17" width="243" align="left">    Decrease in current period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> (1)</td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (1)</td></tr><tr><td height="17" width="243" align="left">    Settlements with taxing authorities</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="29"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (8)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="28"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (12)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="27"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (13)</td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="243">Balance as of December 31 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="29">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 14 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="28">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 18 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="27">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 26 </td></tr><tr><td height="18" style="border-top: 3px solid #000000;" align="left" width="243"><b>PE/SoCalGas:</b></td><td height="18" style="border-top: 3px solid #000000;" align="right" width="29"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="81"> </td><td height="18" style="border-top: 3px solid #000000;" align="right" width="28"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="81"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="27"> </td><td height="18" style="border-top: 3px solid #000000;" align="right" width="81"> </td></tr><tr><td height="17" width="243" align="left">Balance as of January 1 </td><td height="17" width="29" align="right">$</td><td height="17" width="81" align="right"> 19 </td><td height="17" width="28" align="right">$</td><td height="17" width="81" align="right"> 40 </td><td height="17" width="27" align="right">$</td><td height="17" width="81" align="right"> 33 </td></tr><tr><td height="17" width="243" align="left">    Increase in prior period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> 1 </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> 12 </td></tr><tr><td height="17" width="243" align="left">    Decrease in prior period tax positions</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> - </td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (2)</td></tr><tr><td height="17" width="243" align="left">    Settlements with taxing authorities</td><td height="17" width="29" align="right"> </td><td height="17" width="81" align="right"> (1)</td><td height="17" width="28" align="right"> </td><td height="17" width="81" align="right"> (21)</td><td height="17" width="27" align="right"> </td><td height="17" width="81" align="right"> (3)</td></tr><tr><td height="17" width="243" align="left">    Expirations of statutes of limitations</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="29"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> (8)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="28"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> - </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="27"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="81"> - </td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="243">Balance as of December 31 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="29">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 11 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="28">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 19 </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="27">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="81"> 40 </td></tr></table><p>It is reasonably possible that within the next 12 months unrecognized tax benefits could decrease due to the following:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="641" align="left" colspan="7" style="border-top: 1px solid #000000;" height="17"><b>POSSIBLE DECREASES IN UNRECOGNIZED TAX BENEFITS WITHIN 12 MONTHS</b></td></tr><tr><td width="641" align="left" height="17" colspan="7"><i>(Dollars in millions)</i></td></tr><tr><td height="14" width="359" align="left"> </td><td width="282" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="14">At December 31,</td></tr><tr><td height="14" style="border-bottom: 1px solid #000000;" align="left" width="359"><i> </i></td><td width="94" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2009 </td><td width="94" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2008 </td><td width="94" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="14">2007 </td></tr><tr><td height="16" style="border-top: 1px solid #000000;" align="left" width="359"><b>Sempra Energy Consolidated:</b></td><td height="16" style="border-top: 1px solid #000000;" align="center" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="center" width="72"> </td><td height="16" style="border-top: 1px solid #000000;" align="center" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="center" width="72"> </td><td height="16" style="border-top: 1px solid #000000;" align="center" width="22"> </td><td height="16" style="border-top: 1px solid #000000;" align="center" width="72"> </td></tr><tr><td height="17" width="359" align="left">Expiration of statutes of limitations on tax assessments </td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (7)</td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (6)</td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (20)</td></tr><tr><td height="17" width="359" align="left">Potential resolution of audit issues with various</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td></tr><tr><td height="17" width="359" align="left">     U.S. federal, state and local and non-U.S. taxing authorities</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="right"> (24)</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="right"> (17)</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="right"> (30)</td></tr><tr><td height="17" width="359" align="left">Impact of federal and state timing items </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td></tr><tr><td height="17" width="359" align="left">    affecting taxable income</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> - </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> (3)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> (10)</td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="359"> </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (31)</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (26)</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (60)</td></tr><tr><td height="18" style="border-top: 3px solid #000000;" align="left" width="359"><b>SDG&E:</b></td><td height="18" style="border-top: 3px solid #000000;" align="right" width="22"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="72"> </td><td height="18" style="border-top: 3px solid #000000;" align="right" width="22"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="72"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="22"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="72"> </td></tr><tr><td height="17" width="359" align="left">Expiration of statutes of limitations on tax assessments </td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> - </td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> - </td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (6)</td></tr><tr><td height="17" width="359" align="left">Potential resolution of audit issues with various</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td></tr><tr><td height="17" width="359" align="left">     U.S. federal, state and local taxing authorities</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> - </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> - </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> (4)</td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="359"> </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> - </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> - </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (10)</td></tr><tr><td height="18" style="border-top: 3px solid #000000;" align="left" width="359"><b>PE/SoCalGas:</b></td><td height="18" style="border-top: 3px solid #000000;" align="right" width="22"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="72"> </td><td height="18" style="border-top: 3px solid #000000;" align="right" width="22"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="72"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="22"> </td><td height="18" style="border-top: 3px solid #000000;" align="left" width="72"> </td></tr><tr><td height="17" width="359" align="left">Expiration of statutes of limitations on tax assessments </td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (6)</td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (3)</td><td height="17" width="22" align="right">$</td><td height="17" width="72" align="right"> (3)</td></tr><tr><td height="17" width="359" align="left">Potential resolution of audit issues with various</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td></tr><tr><td height="17" width="359" align="left">     U.S. federal, state and local taxing authorities</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="right"> (1)</td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="right"> - </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="right"> (22)</td></tr><tr><td height="17" width="359" align="left">Impact of federal and state timing items </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td><td height="17" width="22" align="right"> </td><td height="17" width="72" align="left"> </td></tr><tr><td height="17" width="359" align="left">    affecting taxable income</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> - </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> (3)</td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="22"> </td><td height="17" style="border-bottom: 1px solid #000000;" align="right" width="72"> (10)</td></tr><tr><td height="18" style="border-bottom: 3px solid #000000;" align="left" width="359"> </td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (7)</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (6)</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="22">$</td><td height="18" style="border-top: 1px solid #000000;border-bottom: 3px solid #000000;" align="right" width="72"> (35)</td></tr></table><p>Amounts accrued for interest expense and penalties associated with income taxes are included in income tax expense on the Consolidated Statements of Operations and in various income tax balances on the Consolidated Balance Sheets. As of December 31, the following amounts were accrued:</p><table style="border-collapse: collapse; margin-top: 20px;"><tr><td width="693" align="left" colspan="21" style="border-top: 1px solid #000000;" height="17"><b>INTEREST EXPENSE AND PENALTIES ASSOCIATED WITH INCOME TAXES</b></td></tr><tr><td width="693" align="left" height="17" colspan="21"><i>(Dollars in millions)</i></td></tr><tr><td height="17" width="162" align="left"> </td><td width="171" align="center" height="17" colspan="6">Sempra Energy</td><td height="17" width="8" align="center"> </td><td width="57" align="center" height="17" colspan="2"> </td><td height="17" width="18" align="center"> </td><td height="17" width="39" align="center"> </td><td height="17" width="18" align="center"> </td><td height="17" width="41" align="center"> </td><td height="17" width="8" align="center"> </td><td height="17" width="18" align="center"> </td><td height="17" width="39" align="center"> </td><td height="17" width="18" align="center"> </td><td height="17" width="39" align="center"> </td><td width="57" align="center" height="17" colspan="2"> </td></tr><tr><td height="17" style="border-bottom: 1px solid #000000;" align="left" width="162"><i> </i></td><td width="171" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="17">Consolidated</td><td height="17" width="8" align="center"> </td><td width="173" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="17">SDG&E</td><td height="17" width="8" align="center"> </td><td width="171" align="center" colspan="6" style="border-bottom: 1px solid #000000;" height="17">PE/SoCalGas</td></tr><tr><td height="17" style="border-top: 1px solid #000000;" align="left" width="162"> </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2009 </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2008 </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2007 </td><td height="17" width="8" align="center"> </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2009 </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2008 </td><td width="59" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2007 </td><td height="17" width="8" align="center"> </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2009 </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2008 </td><td width="57" align="center" colspan="2" style="border-top: 1px solid #000000;border-bottom: 1px solid #000000;" height="17">2007 </td></tr><tr><td height="17" width="162" align="left">Interest expense (benefit)</td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> 2 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> 18 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> (7)</td><td height="17" width="8" align="left"> </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> (2)</td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> 2 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="41"> (11)</td><td height="17" width="8" align="left"> </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> 1 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39"> 4 </td><td height="17" style="border-top: 1px solid #000000;" align="left" width="18">$</td><td height="17" style="border-top: 1px solid #000000;" align="right" width="39">3 </td></tr><tr><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="162">Penalties</td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> 4 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> 1 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> 2 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="8"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> - </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> - </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="41"> - </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="8"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> 1 </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> - </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="left" width="18"> </td><td height="18" style="border-bottom: 3px solid #C0C0C0;" align="right" width="39"> - </td></tr></table><p>Income Tax Audits<br />Sempra Energy is subject to U.S. federal income tax as well as to income tax of multiple state and foreign jurisdictions. We remain subject to examination for U.S. federal tax years after 2005. We are subject to examination by major state tax jurisdictions for tax years after 2001. Certain major foreign income tax returns from 1995 through the present are open to examination. <br />In addition, we have filed state refund claims for tax years back to 1998. The pre-2002 tax years are closed to new issues; therefore, no additional tax may be assessed by the taxing authorities for these years.<br />SDG&E, PE and SoCalGas are subject to U.S. federal income tax as well as income tax of state jurisdictions. They remain subject to examination for U.S. federal years after 2005 and by major state tax jurisdictions for years after 2001. <br />In addition, PE has state refund claims for tax years back to 1993. The pre-2002 tax years are closed to new issues; therefore, no additional tax may be assessed by the taxing authorities for these years.</p></div>
NOTE 8. INCOME TAXES Reconciliation of net U.S. statutory federal income tax rates to the effective income tax rates are as follows:RECONCILIATION OF FEDERAL
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