ALJ/SMW/oma Date of Issuance 11/2/2010

Decision 10-10-022 October 28, 2010

BEFORE THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA

In the Matter of the Application of Southwest Gas Corporation for authority to: (i) issue one or more types of debt securities in the principal amount of up to $200,000,000; (ii) refinance previously issued short-term debt securities; (iii) refinance previously authorized securities under the "Evergreening Authority" guidelines; and (iv) enter into one or more interest rate risk management contracts. (U905G)

Application 10-04-008 (Filed April 2, 2010)

DECISION AUTHORIZING SOUTHWEST GAS CORPORATION
TO ISSUE UP TO $200 MILLION OF NEW DEBT SECURITIES

DECISION AUTHORIZING SOUTHWEST GAS CORPORATION TO ISSUE UP TO $200 MILLION OF NEW DEBT SECURITIES 1

1. Summary 2

2. Background 2

3. Request 3

4. Discussion 5

4.1. Public Utilities Code Requirements for Issuance of Securities 5

4.2. Forecast of Sources and Uses 7

4.3. Types of Securities to be Issued 10

4.4. Encumbrance of Utility Property 10

4.5. Debt Enhancements 12

4.6. Competitive Bidding Rule Exemption 12

4.7. Evergreening Authority 13

5. Reporting Requirement 16

6. Fee 17

7. Financial Information 18

8. California Environmental Quality Act 19

9. Categorization and Need for Hearings 20

10. Comments on Proposed Decision 20

11. Assignment of Proceeding 20

Findings of Fact 20

Conclusions of Law 23

ORDER 26

Attachment A

DECISION AUTHORIZING SOUTHWEST GAS CORPORATION
TO ISSUE UP TO $200 MILLION OF NEW DEBT SECURITIES

1. Summary

This Decision grants Southwest Gas Corporation (Southwest) the authority to issue up to $200 million of new Debt Securities. This Decision also authorizes Southwest, as enumerated in the order of this Decision to: 1) encumber utility property; 2) refinance, refund, or replace currently issued short-term securities;
3) refinance previously authorized securities at maturity, upon mandatory redemption, upon repurchase for mandatory sinking fund requirements, or upon optional refinancing under Evergreening Authority; 4) issue Debt Securities indirectly through Southwest regulated subsidiaries, Southwest regulated affiliates, governmental entities, and/or quasi-governmental entities;
5) guarantee the securities or other obligations of Southwest regulated subsidiaries, Southwest regulated affiliates, governmental entities, and
quasi-governmental entities that issue securities on behalf of Southwest;
6) enter into debt enhancement features; 7) be exempt from the Commission's Competitive Bidding Rule; and 8) report all Debt Securities information required by General Order 24-B to the Commission on a quarterly basis.