1. Victor Vilaplana VP, Electric & Fuel Procurement September 18, 2014 IEPA 33 rd Annual Meeting Energy Procurement, Infrastructure and Policy: Climate Challenges Beyond 2020

2. 2 SDG&E Background  Customer Base 3.4 million 89% residential 11% commercial and industrial  Territory Size 4,100 square-miles 2 counties 25 communities  System 1.4 million electric meters 860,000 gas meters 130 substations Over 1,700 miles of transmission line

3. 3 TO TIJUANA (CFE) ENCINA POWER PLANT Miguel Escondido Talega MEXICO Sycamore Canyon Glencliff Descanso Barrett Cameron Boulder Creek Santa Ysabel Creelman Alpine Narrows Warners Borrego Poway Pomerado Esco Rincon Lilac Ash Valley Center RIVERSIDE CO. SAN DIEGO CO. Capistrano Trabuco Laguna Niguel Margarita Cristianitos Main Street IMPERIAL VALLEY Pala Palomar Energy Calpeak Peaker El Cajon Otay Border00 Lake Hodges Wellhead Escondido MEF To North Gila Substation Arizona ECO Four 230 kV lines to SCE Ocotillo SWPL SRPL Penasquitos Mission Old Town San Luis Rey Monserate Suncrest Substation Kumeyaay Crestwood Boulevard Otay Lake Loveland Los Coches Calpeak Peaker SAN ONOFRE NUCLEAR POWER PLANT ORANGE CO. Major Sources of Local Power

4. 4 Preferred Resources Added Since SONGS Retirement*  Following the shut down of SONGS in January 2012, SDG&E has added the following preferred resources to its portfolio: Energy Efficiency: 96 MW New Roof Top Solar: 155 MW ► Residential: 122 MW ► Non-Residential: 33 MW Renewable Power: 1,235 MW ► In San Diego and delivered over Sunrise Power Link *Capacity values are nameplate Renewable Additions In San Diego NRG Borrego Solar 26 MW Sol Orchard Solar 14 Desert Green Solar 6 Otay V&VI Bio Gas 3 49 MW IV Substation Ocotillo Express Wind 265 MW IV Solar 200 Camp Verde Solar 139 Csolar South Solar 130 Centinella Solar 175 SG2 IV Solar 150 1,059 MW Delivered over Sunrise Arlington Solar 127 MW

5. 5 SDG&E RPS Goal Status *SDG&E is projected to achieve 33% in 2014

6. 6 SDG&E’s Customer Profile  SDG&E has a very low Industrial load  As a result, SDG&E’s load peaks twice during the day – once in the morning and again later in the afternoon and into the evening  This is the inverse of peak solar generation time periods *CEC California Energy Demand 2014-2024 Final Forecast, PGE Mid, SCE Mid, and SDG&E Mid (estimated 2014 Manufacturing, Mining, and Agriculture consumption) (http://www.energy.ca.gov/2013_energypolicy/documents/ demand-forecast_CMF/mid_case/)http://www.energy.ca.gov/2013_energypolicy/documents/ demand-forecast_CMF/mid_case/ **CAISO (http://www.ferc.gov/CalendarFiles/20140610083142-Bouillon,%20CAISO.pdf)http://www.ferc.gov/CalendarFiles/20140610083142-Bouillon,%20CAISO.pdf **

7. 7 SDG&E’s Typical Rooftop Solar Customer Profile

8. 8 Path Forward Utilize Peaking Facilities – Recent Achievements  Wellhead Escondido Repower Complete (10 MW increase)  Pio Pico Contract Approved June 2014 Will facilitate shutdown of 188 MW of 1960’s era peaker plants Currently before State Court of Appeals (may delay contractual on-line date of September 2015)  Carlsbad Energy Center Application Filed July 2014 Integrate Planning – Siloed Mandates are Ineffective  CHP: results in must take generation when flexibility should be the focus  RPS: requirements are disconnected from the need for local capacity  RAM: intended to jump-start RPS procurement, but continued after IOUs had met/exceeded targets  SB1122: target not related to actual procurement need ProgramTechnologyTarget (MW) Re-MATRenewable49 SB 1122Bioenergy25 RAMRenewable155 CHPCombined Heat & Power 211 Storage 165 EE (2014 forecast) Energy Efficiency 43 DR (2014 forecast) Demand Response 78 Total~726