Reliable access to safe, affordable electricity underpins a prosperous society where people of all backgrounds can thrive. In order to reach the rising world-wide demand for cleaner power, Sempra is helping plan and build a new energy system — one that accounts for population growth, rising living standards and the increased need for climate resilience and reliability, while maintaining affordability. We believe this future energy system is anchored in electrification of consumer markets and increasingly cleaner fuels for industrial uses.
Here’s a look at how Sempra’s electric utilities — representing roughly 70% of Sempra’s total utility rate base — are helping the communities they serve progress toward net-zero.
Accelerating energy storage solutions
Due to the intermittency of renewable energy sources, energy storage will play an increasingly important role in coming years. Sempra’s California utilities are working to expand energy storage options to help the state decarbonize. San Diego Gas & Electric (SDG&E) has a diverse portfolio of energy storage solutions including mobile batteries and the first utility-scale vanadium redox flow (VRF or flow battery) connected to the California Independent System Operator (CAISO) market. The company is expected to have 145 MW of utility-owned storage capacity by the end of 2022.
When power is generated and unable to be used immediately, excess renewable electricity can be used to produce hydrogen, which can be stored for longer periods and converted back into electricity when it’s needed. This longer-duration energy storage could help align demand with supply not just across hours, but across days and seasons. SDG&E is also piloting hydrogen for long-duration energy storage, and as a microgrid asset and resource for dispatch by the CAISO to support grid reliability.
Fueling a clean transportation future
Our companies have been working aggressively to expand clean transportation infrastructure, including electric vehicle (EV) charging and natural gas fueling stations, across the communities we serve. SDG&E has built 3,260 EV charging stations to date and has thousands more planned. The utility is also piloting vehicle-to-grid technology (V2G) to connect electric school buses to 60kW bi-directional DC fast chargers. The batteries onboard the buses will soak up energy during downtime and when clean energy is abundant on the grid (such as midday when solar energy production is at its peak) and discharge energy to the grid during peak demand hours in the afternoon and evening. The goal is to help ease strain on the grid, reduce energy costs, and explore a new technology that could be crucial for the pathway to net-zero.
In 2020, Oncor collaborated with the National Renewable Energy Laboratory (NREL) to examine the opportunity for near-term electrification of heavy-duty trucks, or semi-trucks with a gross vehicle weight greater than 26,000 pounds. This segment of vehicles is responsible for around 15% of total U.S. transportation energy use and greenhouse gas emissions. The study explored the impact of these vehicles on the grid, showing that in most cases the existing technology can accommodate truck charging at depots. Oncor performed a load integration study for 36 substations and summarized the costs and timelines required for anticipated grid upgrades. The team found that most (~80%) of the substations studied could supply the time-varying loads of 100 trucks charged at 100 kW/vehicle without any upgrades, and an additional 10% of substations could avoid upgrades if fleets used “smart” charging. As technologies that enable heavy-duty fleet electrification become available, studies like this can help anticipate and support the transition to clean transportation.
As the owner of one of North America’s largest energy networks, Sempra is positioned to help enable the electrification of consumer markets and help advance society’s net-zero ambitions. We have been on a sustained path to decarbonize our business operations and the markets we serve for two decades and, while we are in it for the long-haul, the pace we set today matters. Learn more about our commitment to sustainability.
This article contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions with respect to the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed in any forward-looking statements. These forward-looking statements represent our estimates and assumptions only as of the date of this article. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or other factors.
In this article, forward-looking statements can be identified by words such as "believes," "expects," "intends," "anticipates," "plans," "estimates," "projects," "forecasts," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "in process," "under construction," "in development," "opportunity," "target," "outlook," "maintain," "continue," "goal," "aim," "commit," or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations.
Factors, among others, that could cause actual results and events to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: California wildfires, including the risks that we may be found liable for damages regardless of fault and that we may not be able to recover all or a substantial portion of costs from insurance, the wildfire fund established by California Assembly Bill 1054, in rates from customers or a combination thereof; decisions, investigations, regulations, issuances or revocations of permits and other authorizations, renewals of franchises, and other actions by (i) the California Public Utilities Commission (CPUC), Comisión Reguladora de Energía, U.S. Department of Energy, U.S. Federal Energy Regulatory Commission, Public Utility Commission of Texas, and other regulatory and governmental bodies and (ii) states, counties, cities and other jurisdictions in the U.S., Mexico and other countries in which we do business; the success of business development efforts, construction projects and acquisitions and divestitures, including risks in (i) the ability to make a final investment decision, (ii) completing construction projects or other transactions on schedule and budget, (iii) the ability to realize anticipated benefits from any of these efforts if completed, and (iv) obtaining the consent or approval of partners or other third parties, including governmental entities and regulatory bodies; the resolution of civil and criminal litigation, regulatory inquiries, investigations and proceedings, arbitrations, and property disputes, including those related to the natural gas leak at Southern California Gas Company's (SoCalGas) Aliso Canyon natural gas storage facility; changes to laws, including changes to certain of Mexico's laws and rules that impact energy supplier permitting, energy contract rates, the electricity industry generally and the ability to import, export, transport and store hydrocarbons; cybersecurity threats, including by state and state-sponsored actors, to the energy grid, storage and pipeline infrastructure, information and systems used to operate our businesses, and confidentiality of our proprietary information and personal information of our customers and employees, including ransomware attacks on our systems and the systems of third-party vendors and other parties with which we conduct business, all of which have become more pronounced due to recent geopolitical events and other uncertainties, such as the war in Ukraine; failure of foreign governments and state-owned entities to honor their contracts and commitments; actions by credit rating agencies to downgrade our credit ratings or to place those ratings on negative outlook and our ability to borrow on favorable terms and meet our debt service obligations; the impact of energy and climate policies, legislation, rulemaking and disclosures, as well as related goals set and actions taken by companies in our industry, including actions to reduce or eliminate reliance on natural gas generally and any deterioration of or increased uncertainty in the political or regulatory environment for California natural gas distribution companies and the risk of nonrecovery for stranded assets; the pace of the development and adoption of new technologies in the energy sector, including those designed to support governmental and private party energy and climate goals, and our ability to timely and economically incorporate them into our business; weather, natural disasters, pandemics, accidents, equipment failures, explosions, acts of terrorism, information system outages or other events that disrupt our operations, damage our facilities and systems, cause the release of harmful materials, cause fires or subject us to liability for property damage or personal injuries, fines and penalties, some of which may not be covered by insurance, may be disputed by insurers or may otherwise not be recoverable through regulatory mechanisms or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of electric power and natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid or limitations on the withdrawal of natural gas from storage facilities; the impact of the COVID-19 pandemic, including potential vaccination mandates, on capital projects, regulatory approvals and the execution of our operations; the impact at San Diego Gas & Electric Company (SDG&E) on competitive customer rates and reliability due to the growth in distributed and local power generation, including from departing retail load resulting from customers transferring to Community Choice Aggregation and Direct Access, and the risk of nonrecovery for stranded assets and contractual obligations; Oncor Electric Delivery Company LLC's (Oncor) ability to eliminate or reduce its quarterly dividends due to regulatory and governance requirements and commitments, including by actions of Oncor's independent directors or a minority member director; volatility in foreign currency exchange, inflation and interest rates and commodity prices, including inflationary pressures in the U.S., and our ability to effectively hedge these risks and with respect to inflation and interest rates, the impact on SDG&E's and SoCalGas' cost of capital and the affordability of customer rates; changes in tax and trade policies, laws and regulations, including tariffs, revisions to international trade agreements and sanctions, such as those that have been imposed and that may be imposed in the future in connection with the war in Ukraine, which may increase our costs, reduce our competitiveness, impact our ability to do business with certain current or potential counterparties, or impair our ability to resolve trade disputes; and other uncertainties, some of which may be difficult to predict and are beyond our control.
These risks and uncertainties are further discussed in the reports that Sempra has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC's website, www.sec.gov, and on Sempra's website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.
Sempra Infrastructure, Sempra Texas, Sempra Texas Utilities, Oncor and Infraestructura Energética Nova, S.A.P.I. de C.V. (IEnova) are not the same companies as the California utilities, SDG&E or SoCalGas, and Sempra Infrastructure, Sempra Texas, Sempra Texas Utilities, Oncor and IEnova are not regulated by the CPUC.