Oncor's 33 GW Peak Demand Drives 20% Capital Plan Increase
Sempra expects a 20% increase to Oncor's five-year $47.5 billion capital plan after the Texas utility hit a new peak demand of 33 GW, driven by strong load growth from data centers and other sectors.
Oncor's system reached a new peak demand of 33 gigawatts in August 2026, a 6% increase over the prior record. This surge has prompted parent company Sempra to anticipate a 20% rise in Oncor's upcoming five-year capital plan, which currently stands at a $47.5 billion base for 2027-2031.
The record peak reflects continued load growth across Oncor's footprint. Sempra's CEO and Chairman Jeffrey Martin stated Oncor continues to see 'remarkably strong demand growth'. The company's annual update will detail the revised capital plan, reflecting the full 20% increase driven by this sustained demand.
Texas Growth Fuels Demand Surge
The capital plan increase is driven by continued strong customer and load growth from various sectors, including data centers. Oncor serves more than 14 million customers in Texas, underpinning the scale of the demand surge. Sempra's own pipeline of large-load requests has grown to 19 gigawatts, representing a 23% increase year-over-year.
Sempra's financial performance is increasingly tied to this Texas growth. The company reported third-quarter adjusted earnings of $917 million, or $1.40 per share, a 26% increase from the prior year. Sempra Texas contributed $154 million of higher equity earnings from new base rates and higher customer consumption. The company's overall rate base is projected to exceed $65 billion in 2026, with Texas supplying an ever-larger share of that growth.
Regulatory and Financial Risks in California
While Texas booms, Sempra's California utilities face financial risk due to wildfire liability uncertainty. Fitch Ratings cited the California legislature's failure to pass wildfire liability reform as a significant adverse credit development. Further pressure came when the California Public Utilities Commission issued a proposed decision denying Sempra's petition to modify a 2024 General Rate Case decision.
This denial has a direct revenue requirement impact of $188 million for 2027. Sempra had aimed to collect that amount from the rate case. The issue is confined to 2027, as new rates from a pending 2028 General Rate Case are scheduled to take effect in January 2028. Martin stated that this California issue would have no impact on the company's 7% to 9% long-term growth rate guidance.
Strategic Moves Amid Market Shifts
Sempra is executing strategic financial moves alongside its operational planning. The company expects to close the sale of a 45% equity stake in SI Partners within two weeks. Proceeds are earmarked for debt reduction and balance sheet strengthening.
Leadership changes are also underway. Justin Bird will become Chief Financial Officer, Karen Sedgwick will become President and CEO of SoCalGas, and Faisel Khan rejoins Sempra as Chief Commercial Officer. On the regulatory front, a separate California proceeding known as Project 58481 is scheduled for consideration in December. It is modeled to reduce residential bills by $15 to $35 per year.
Political uncertainty adds another layer. Commenting on recent midterm elections, Sempra CEO Allen Nye said, "It’s too soon to tell exactly how the results of the midterm elections will impact Oncor." Jeffrey Martin added, "We continue to believe that both parties want a strong and growing Texas." Sempra's upcoming annual update will detail the revised capital plan reflecting the 20% increase driven by sustained demand growth.
