2023 SDGE ANNUAL REPORT-FINAL 2.29.2024 - Flipbook - Page 42
9.1.11 DESCRIPTION OF SUPPLIER DIVERSITY ACTIVITIES AND
PROGRESS IN FUEL PROCUREMENT
We remain committed to creating opportunities for diverse natural gas suppliers. In 2023, we purchased over $22.8 million of
natural gas, used for our gas-fired electric generation plants, from diverse suppliers. We faced challenges in diversifying our power
procurement because our obligation to procure least-cost, best-fit electricity from suppliers, and to manage risk exposure by finding
and vetting suppliers who meet our credit requirements. It is often difficult for diverse suppliers with limited access to credit to mount
a plausible case for their proposals against large electric generators financed by investment firms or commercial banks. We continue
to work with individual diverse suppliers on credit requirements and access to credit strategies in order to foster their participation
in the electricity market. SDG&E and other utility buyers use a specialized credit instrument, the Funds Transfer Agency Agreement
(FTAA), to assist small suppliers in short-term procurement opportunities. The FTAA facilitates entry into a capital-intensive portion
of our power procurement process for diverse suppliers without having to utilize their available lines of credit.
Supplier Diversity
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