The ratings on Southern California Gas Co. (SoCalGas) reflect the company's strong business profile. The competitive profile is characterized by a growing service area and a low-cost and diverse gas supply. As the single-largest gas utility in the U.S., SoCalGas commands significant leverage regarding its purchase of gas from domestic and Canadian producers. SoCalGas realizes about 1% residential customer additions annually, which is supported by rates that are competitive with electricity and other fuels. The utility provides transportation-only services to its large industrial and electric power generation customers, which account for about 65% of volumes, but only 12% of margin. SoCalGas' competitive position in this arena was enhanced greatly by a rate-restructuring package that gradually lowers rates and allows for
