What the changes say
- Cybersecurity and data governance are separated into distinct risks as digitalization, AI, grid networking and California data disclosures expand exposure.
- Trade barriers, Mexico’s 2025 Energy Laws, Oncor’s expanded capital program and financing needs add project and funding uncertainty.
- Legacy risks for preferred dividends, the Aliso Canyon leak, CPUC affiliate rules and activist campaigns receive less emphasis or disappear.
What changed since the prior 10-K
New
- NewOperational Risks
Cybersecurity and Technology Resiliency
Digitalization, AI, grid modernization and connected operational technology increase exposure to cyberattacks or failures affecting utilities, infrastructure and third parties.
- NewOperational Risks
Data Security and Governance
California data disclosures and privacy laws increase risks involving customer personal information, energy-use data and other sensitive information.
- NewOperational Risks
Conditions in global markets, including the impact of enacted and proposed tariffs and other trade actions, may materially and adversely affect us
Tariffs, sanctions, foreign restrictions and shipment delays could raise costs for imported equipment and undermine LNG and other project economics.
- NewFinancial Risks
Our debt service obligations expose us to risks
Significant debt service and capital needs could increase refinancing costs, restrict strategic flexibility and impose unfavorable financing terms.
- NewFinancial Risks
Credit rating agencies may downgrade our credit ratings or place them on negative outlook, and our efforts to maintain these ratings could require additional equity securities issuances by Sempra or sales of equity interests in subsidiaries or projects in development
Credit downgrades could raise funding costs and require Sempra to issue equity or sell interests in subsidiaries or projects.
- NewLegal and Regulatory Risks
The industries in which we operate are subject to extensive regulation, increasing regulatory uncertainty and political influence and polarization
Political polarization, San Diego municipalization, Mexico’s 2025 Energy Laws and approval delays could restrict operations or increase regulatory costs.
- NewOperational Risks
The electricity industry is undergoing significant change
California’s rapid renewable, storage and electrification growth requires major grid modernization while increasing instability, obsolescence and competition from third-party technologies.
- NewFinancial Risks
Oncor’s capital expenditures plan may not be executed as planned or achieve its business objectives
Oncor’s planned capital projects, including ERCOT’s first 765-kV buildout, may be delayed, resized or fail to deliver expected benefits.
- NewFinancial Risks
Oncor’s business is capital-intensive, with significant expected increases to capital spending in future periods
Oncor’s rising capital spending depends on external financing, while credit pressures include Texas wildfire exposure and limited litigation protections.
- NewFinancial Risks
If the CRNCI becomes redeemable, SI Partners may not have sufficient funds available to fulfill its obligation of redemption
Blackstone could require redemption of its PA2 JVCo interest after specified underperformance, construction, contract or monetization events without sufficient funds available.
- NewRisk Related to Planned Sales of Certain Assets and Businesses
We may be unable to complete or realize the anticipated benefits from our planned sales of certain of our assets and businesses as part of our capital recycling program
Planned sales of 45% of SI Partners and Ecogas may face delayed or failed closings, regulatory challenges, consents or costly conditions.
Dropped
- DroppedOperational and Structural Risks
2024 Form 10-K | 38 shareholders can be costly and time-consuming and requires time and attention by our board of directors and management, diverting their attention from our business strategies
- DroppedFinancial and Capital Stock-Related Risks
The dividend requirements of our preferred stock subject us to risks
- DroppedOperational Risks
We face evolving cybersecurity and technology resiliency risks associated with the energy grid, pipelines, storage and other infrastructure as well as the collection of personal, sensitive and confidential information
- DroppedFinancial Risks
Our debt service obligations expose us to risks and could require additional equity securities issuances by Sempra or sales of equity interests in subsidiaries or projects under development
Activist shareholder campaigns could divert management attention, disrupt strategy and make personnel or business-partner recruitment more difficult.
- DroppedFinancial Risks
Credit rating agencies may downgrade our credit ratings or place them on negative outlook
- DroppedLegal and Regulatory Risks
We face risks related to failures and delays in obtaining and maintaining permits, licenses, franchises and other approvals required by our businesses
- DroppedOther Energy Transition Risks
2024 Form 10-K | 48 we further modify our GHG emissions reduction aims or there are negative views about our environmental disclosures or practices generally
- DroppedOperational Risks
The electricity industry is undergoing significant change, including increased deployment of renewable energy sources and energy storage, technological advancements, evolving procurement service standards, and political and regulatory developments
Preferred-stock dividend obligations could restrict common dividends and repurchases if Series C dividends go unpaid.
- DroppedLegal and Regulatory Risks
CPUC Authority Over Operational Matters
- DroppedLegal and Regulatory Risks
From October 23, 2015 through February 11, 2016, SoCalGas experienced the Leak, which we describe in Note 15 of the Notes to Consolidated Financial Statements
- DroppedFinancial Risks
Oncor could have liquidity needs that necessitate additional investments
Combined cybersecurity, technology and sensitive-information risks affecting the energy grid, pipelines, storage and other infrastructure.
- DroppedFinancial Risks
Sempra Infrastructure’s business is capital-intensive and relies on various types of financing arrangements, which may not be adequate or available in the future
Reworded
- 94% rewrittenLegal and Regulatory Risks
The Mexican government exercises significant and increasing influence over the Mexican energy sector and has adopted additional changes that could impact private investment in this sector
The risk now specifically cites Mexico’s 2024 constitutional reforms, 2025 Energy Laws, 2025 regulations and authorities’ broad permit-revocation powers.
Was: The Mexican government exercises significant and increasing influence over the Mexican energy sector and has adopted or proposed additional changes that, in each case, could impact private investment in this sector
- 81% rewrittenOperational Risks
Natural gas continues to be the subject of political and public debate, including a desire by some to reduce or eliminate reliance on natural gas as an energy source
The risk adds proposed and enacted building-heater requirements, CPUC gas-system planning and customer-driven gas-service disconnections.
- 80% rewrittenOperational and Structural Risks
Our business could be negatively affected by activist shareholders
The wording is streamlined but retains proxy efforts, takeover influence and potential loss of NOL or tax-credit carryforwards.
- 76% rewrittenOperational Risks
Our businesses depend on the performance of counterparties
The risk adds supplies, says alternatives may be unavailable and changes enforcement language from unpredictability to possible failure.
- 72% rewrittenOperational Risks
More and Increasingly Severe Wildfires
The wildfire risk is substantively unchanged, with minor wording clarifying prevention and containment challenges.
- 66% rewrittenLegal and Regulatory Risks
Rates and Other Financial Matters
FERC jurisdiction is clarified to cover SDG&E interstate transmission and wholesale electric rates and conditions of service.
- 66% rewrittenIndustry-Related Risks
Changes in the regulation of Oncor or the regulation or operation of the electric utility industry and/or ERCOT market could negatively affect Oncor
The risk adds specific oversight by the PUCT, FERC, NERC and Texas Reliability Entity and potential ERCOT changes by Texas authorities.
Was: Changes in the regulation of Oncor or the regulation or operation of the electric utility industry and/or the ERCOT market could negatively affect Oncor
- 66% rewrittenFinancial Risks
Our businesses are exposed to fluctuations in commodity prices
The risk replaces a detailed list of price drivers with explicit exposure to unanticipated natural-gas, LNG, electricity and other commodity prices absent adequate hedging.
- 64% rewrittenLegal and Regulatory Risks
U.S. and Foreign Laws and International Relations
- 64% rewrittenOperational Risks
We may not be able to secure, maintain, extend or replace long-term supply, sales or capacity agreements
- 60% rewrittenOperational Risks
We face risks related to activities and projects intended to advance new energy-related technologies
Was: We face risks related to increasing activities and projects intended to advance new energy technologies
- 58% rewrittenOperational Risks
We actively seek opportunities in the market through acquisitions, partnerships, JVs and divestitures, and we may be unable to complete or realize the anticipated benefits from such transactions
Was: We actively seek opportunities in the market through acquisitions, partnerships, JVs and divestitures
- 56% rewrittenLegal and Regulatory Risks
Environmental and Climate Change Regulation
- 56% rewrittenFinancial and Capital Stock-Related Risks
Successfully executing our five-year capital expenditures plan is subject to risks
Was: Successfully completing our five-year capital expenditures plan is subject to certain risks
- 53% rewrittenOperational Risks
The operation of our facilities depends on good labor relations with our employees and our ability to attract and retain qualified personnel
- 52% rewrittenFinancial and Capital Stock-Related Risks
Settlement provisions contained in forward sale agreements in connection with our ATM program subject us to certain risks
Was: Settlement provisions contained in the forward sale agreements we may enter into in connection with our ATM program subject us to certain risks
- 48% rewrittenFinancial Risks
Fixed-price long-term contracts for services or commodities expose our businesses to risks
Was: Fixed-price long-term contracts for services or commodities expose our businesses to inflationary pressures
- 47% rewrittenOperational Risks
Energy Infrastructure Projects
- 46% rewrittenFinancial Risks
The availability and cost of financing could be negatively affected by market and economic conditions and other factors
Was: The availability and cost of debt or equity financing could be negatively affected by market and economic conditions and other factors
- 45% rewrittenOperational Risks
Regulatory Actions Related to Wildfire Mitigation Efforts
Was: Wildfire Mitigation Efforts
- 42% rewrittenOperational and Structural Risks
Sempra’s ability to pay dividends and meet its obligations largely depends on the performance of its subsidiaries and entities accounted for as equity method investments
- 42% rewrittenLegal and Regulatory Risks
We face risks related to unsettled property rights and titles in Mexico
- 40% rewrittenOperational and Structural Risks
Our investments in businesses we do not control expose us to risks
- 39% rewrittenFinancial and Capital Stock-Related Risks
The economic interest, voting rights and market value of our outstanding common stock may be adversely affected by any additional equity securities we may issue
Was: The economic interest, voting rights and market value of our outstanding common and preferred stock may be adversely affected by any additional equity securities we may issue
- 37% rewrittenLegal and Regulatory Risks
Regulatory and Legislative Changes and Influence of Other Organizations
Was: Regulatory Changes and Influence of Other Organizations
- 37% rewrittenLegal and Regulatory Risks
Our international businesses and operations expose us to increased legal, regulatory, tax, economic, geopolitical, credit and management oversight risks and challenges
- 37% rewrittenLegal and Regulatory Risks
Failure by the CPUC to adequately reform SDG&E’s electric rate structure could negatively impact Sempra and SDG&E
Was: Failure by the CPUC to adequately reform SDG&E’s electric rate structure could negatively impact SDG&E and Sempra
- 36% rewrittenOther Energy Transition Risks
We may be negatively impacted by the outcome of litigation or other proceedings in which we are involved
- 36% rewrittenOperational Risks
Our infrastructure and its supporting systems subject us to risks
Was: Our businesses are subject to risks arising from their infrastructure and systems that support this infrastructure
- 36% rewrittenLegal and Regulatory Risks
We face risks related to environmental and climate change regulation and the costs of the energy transition
- 34% rewrittenOperational Risks
SDG&E may incur significant costs and liabilities from its partial ownership of a nuclear facility being decommissioned
- 33% rewrittenFinancial Risks
Market performance, significant transactions or changes in other assumptions could require unplanned contributions to pension and PBOP plans
Was: Market performance or changes in other assumptions could require unplanned contributions to pension and PBOP plans
- 33% rewrittenOperational Risks
We face risks related to severe weather, natural disasters, physical attacks and other similar events
- 28% rewrittenFinancial Risks
An impairment of our long-lived assets could result in a material charge to earnings
Was: An impairment of our goodwill or long-lived assets could result in a material charge to earnings
- 25% rewrittenOperational Risks
Cost Recovery Through Insurance or Rates
- 24% rewrittenOperational Risks
We face risks from increasing competition
Was: We face risks from increased competition
- 22% rewrittenOther Energy Transition Risks
We are subject to complex tax and accounting requirements that expose us to risks
All 54 risk factors
Headings as the filing states them, in filing order.
Operational and Structural Risks
- 01Sempra’s ability to pay dividends and meet its obligations largely depends on the performance of its subsidiaries and entities accounted for as equity method investments42% rewritten
- 02Our investments in businesses we do not control expose us to risks40% rewritten
- 03Our business could be negatively affected by activist shareholders80% rewritten
- 37Ring-fencing measures, governance mechanisms and commitments limit our ability to influence the management, policies and operations of Oncor
Financial and Capital Stock-Related Risks
- 04Successfully executing our five-year capital expenditures plan is subject to risks56% rewritten
- 05Settlement provisions contained in forward sale agreements in connection with our ATM program subject us to certain risks52% rewritten
- 06The economic interest, voting rights and market value of our outstanding common stock may be adversely affected by any additional equity securities we may issue39% rewritten
Operational Risks
- 07Our infrastructure and its supporting systems subject us to risks36% rewritten
- 08We face risks related to severe weather, natural disasters, physical attacks and other similar events33% rewritten
- 09Cybersecurity and Technology ResiliencyNew
- 10Data Security and GovernanceNew
- 11Conditions in global markets, including the impact of enacted and proposed tariffs and other trade actions, may materially and adversely affect usNew
- 12We actively seek opportunities in the market through acquisitions, partnerships, JVs and divestitures, and we may be unable to complete or realize the anticipated benefits from such transactions58% rewritten
- 13We face risks related to activities and projects intended to advance new energy-related technologies60% rewritten
- 14The operation of our facilities depends on good labor relations with our employees and our ability to attract and retain qualified personnel53% rewritten
- 15Our businesses depend on the performance of counterparties76% rewritten
- 28More and Increasingly Severe Wildfires72% rewritten
- 29Cost Recovery Through Insurance or Rates25% rewritten
- 30Regulatory Actions Related to Wildfire Mitigation Efforts45% rewritten
- 31The electricity industry is undergoing significant changeNew
- 32Natural gas continues to be the subject of political and public debate, including a desire by some to reduce or eliminate reliance on natural gas as an energy source81% rewritten
- 33SDG&E may incur significant costs and liabilities from its partial ownership of a nuclear facility being decommissioned34% rewritten
- 42Energy Infrastructure Projects47% rewritten
- 43We face risks from increasing competition24% rewritten
- 44We may not be able to secure, maintain, extend or replace long-term supply, sales or capacity agreements64% rewritten
- 45We rely on transportation assets and services, much of which we do not control, to deliver natural gas and electricity
Financial Risks
- 16Our debt service obligations expose us to risksNew
- 17The availability and cost of financing could be negatively affected by market and economic conditions and other factors46% rewritten
- 18Credit rating agencies may downgrade our credit ratings or place them on negative outlook, and our efforts to maintain these ratings could require additional equity securities issuances by Sempra or sales of equity interests in subsidiaries or projects in developmentNew
- 19We do not fully hedge our assets or contract positions against changes in commodity prices or interest rates, and for positions that are hedged, our hedging mechanisms may not mitigate our risk or reduce our losses as intended
- 20Risk management procedures may not prevent or mitigate losses
- 21An impairment of our long-lived assets could result in a material charge to earnings28% rewritten
- 22Market performance, significant transactions or changes in other assumptions could require unplanned contributions to pension and PBOP plans33% rewritten
- 39Oncor’s capital expenditures plan may not be executed as planned or achieve its business objectivesNew
- 40Oncor’s business is capital-intensive, with significant expected increases to capital spending in future periodsNew
- 41Sempra could incur substantial tax liabilities if EFH’s 2016 spin-off of Vistra is deemed to be taxable
- 46Fixed-price long-term contracts for services or commodities expose our businesses to risks48% rewritten
- 47Our international businesses and operations expose us to foreign currency exchange rate and inflation risks
- 48Our businesses are exposed to fluctuations in commodity prices66% rewritten
- 49If the CRNCI becomes redeemable, SI Partners may not have sufficient funds available to fulfill its obligation of redemptionNew
Legal and Regulatory Risks
- 23The industries in which we operate are subject to extensive regulation, increasing regulatory uncertainty and political influence and polarizationNew
- 24We face risks related to environmental and climate change regulation and the costs of the energy transition36% rewritten
- 25Environmental and Climate Change Regulation56% rewritten
- 34Rates and Other Financial Matters66% rewritten
- 35Regulatory and Legislative Changes and Influence of Other Organizations37% rewritten
- 36Failure by the CPUC to adequately reform SDG&E’s electric rate structure could negatively impact Sempra and SDG&E37% rewritten
- 50Our international businesses and operations expose us to increased legal, regulatory, tax, economic, geopolitical, credit and management oversight risks and challenges37% rewritten
- 51The Mexican government exercises significant and increasing influence over the Mexican energy sector and has adopted additional changes that could impact private investment in this sector94% rewritten
- 52U.S. and Foreign Laws and International Relations64% rewritten
- 53We face risks related to unsettled property rights and titles in Mexico42% rewritten
Other Energy Transition Risks
- 26We are subject to complex tax and accounting requirements that expose us to risks22% rewritten
- 27We may be negatively impacted by the outcome of litigation or other proceedings in which we are involved36% rewritten
Industry-Related Risks
- 38Changes in the regulation of Oncor or the regulation or operation of the electric utility industry and/or ERCOT market could negatively affect Oncor66% rewritten
Risk Related to Planned Sales of Certain Assets and Businesses
- 54We may be unable to complete or realize the anticipated benefits from our planned sales of certain of our assets and businesses as part of our capital recycling programNew
Other Sempra 10-Ks
- FY2024 10-K risk factors55 risks
California wildfire exposure is prominent, including insurance, rate recovery and mitigation-cost risks for SDG&E and SoCalGas.
Filed Feb 25, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.