...San Diego Gas & Electric Company's (SDG&E) rating and Outlook benefit from California's overall constructive regulatory framework. The enactment of Assembly Bill (AB) 1054 provides protection against catastrophic wildfires at a reasonable cost. The continuation of inverse condemnation remains a long-term credit issue for SDG&E. Other credit constraints include risks associated with comingling of funds with other California electric utilities in the wildfire fund, and the lack of a track record of implementing the new wildfire legislation, especially the prudence standard, which is subject to interpretation....
