Southwest Gas Holdings Inc's Business Segments

In 2015, the Board of Directors (“Board”) of Southwest Gas Corporation authorized management to evaluate and pursue a holding company reorganization to provide further separation between regulated and unregulated businesses, and to provide additional financing flexibility. As part of the holding company reorganization, Centuri Construction Group, Inc. (“Centuri”) and Southwest Gas Corporation would each be subsidiaries of the new publicly traded parent holding company, Southwest Gas Holdings, Inc. (“Southwest Gas Holdings”); whereas, historically, Centuri had been a direct subsidiary of Southwest Gas Corporation. All of Southwest Gas Corporation’s outstanding debt securities (not associated with Centuri) at the time of the reorganization would remain at the Southwest Gas utility entity. Regulatory applications for preapproval of the reorganization were filed with the Arizona Corporation Commission (“ACC”), the California Public Utilities Commission (“CPUC”), and the Public Utilities Commission of Nevada (“PUCN”) in October 2015. Approvals were received from the CPUC, the PUCN, and the ACC in January, March, and May, respectively, of 2016. The reorganization, which was approved by the Board of Directors in December 2016, became effective in January 2017. Each outstanding share of Southwest Gas Corporation’s common stock automatically converted into a share of stock in Southwest Gas Holdings, on a one-for-one basis, and the ticker symbol of the stock, “SWX,” remains unchanged. This report is as of the balance sheet date of December 31, 2016 and periods up to that date (prior to the effective date of the holding company formation), with disclosures, where appropriate, for events following that date. Throughout this report, the “Company” refers to Southwest Gas Corporation and subsidiaries for periods prior to January 1, 2017 and to Southwest Gas Holdings, Inc. and subsidiaries for periods subsequent to December 31, 2016.

Southwest Gas Holdings, Inc. is primarily known for its involvement in the natural gas industry. The company operates predominantly in two main segments: its natural gas utility services and its midstream services, with an emphasis on delivering reliable natural gas services, considered an essential utility in the regions it serves.

Segments

1. Natural Gas Utility:
- Overview: This segment is the core of Southwest Gas Holdings, providing natural gas distribution services. The utility segment serves residential, commercial, and industrial customers, facilitating the transport of natural gas from pipelines to end-users.
- Distribution Network: Southwest Gas operates an extensive distribution network spread across multiple states, primarily focused on areas in Arizona, Nevada, and California.
- Customer Base: The utility serves millions of customers, focusing on maintaining high service reliability and customer satisfaction, with dedicated resources for emergency response and system upgrades.

2. Midstream Services:
- Overview: The midstream services segment relates to the transportation, gathering, and storage of natural gas and natural gas liquids. This segment operates independent of the traditional utility model and targets a different customer base, focusing on larger scale industrial and commercial needs.
- Infrastructure: This includes various pipeline facilities and facilities that are designed for storage and processing of natural gas, catering to the demands on supply and storage capacity.
- Acquisitions and Growth: Southwest Gas has been known to explore strategic acquisitions to enhance its midstream capabilities and leverage efficiencies across its operations.

Products and Services

1. Natural Gas Distribution:
- Residential Services: Southwest Gas delivers natural gas to residential customers for heating, water heating, cooking, and other domestic applications. This includes the installation of residential meters and pipelines.
- Commercial Services: For commercial establishments, Southwest Gas offers tailored services, including installation options for eateries, retail businesses, and other commercial entities. They also provide energy efficiency programs to help businesses lower operating costs.
- Industrial Services: Southwest Gas provides robust solutions for industrial clients that require large volumes of gas for manufacturing processes, heating, or as a primary fuel source.

2. Pipeline and Transportation Services:
- Long-Distance Transportation: The company has developed capabilities that allow for the long-distance transportation of natural gas to meet the needs of distant markets or consumers. This is often facilitated through interconnected pipeline systems.
- Storage Facilities: Southwest Gas operates various storage facilities, which play a critical role in managing supply and demand fluctuations, ensuring that customers have access to natural gas when needed.

3. Energy Efficiency Programs:
- Southwest Gas invests in and promotes energy efficiency initiatives aimed at helping customers reduce their natural gas consumption. This includes offering rebates for energy-efficient appliances and systems, as well as education on best practices for energy use.

4. Renewable Natural Gas (RNG) and Sustainability Initiatives:
- In recent years, Southwest Gas has also shown an interest in renewable energy sources, particularly renewable natural gas projects. These initiatives involve capturing methane emissions from landfills or agricultural sites and converting them into renewable natural gas, which can be injected into the existing gas pipeline infrastructure.

5. Customer Support Services:
- Utility Billing Services: The company provides various billing options for its customers, including online payment options, budget billing plans, and payment assistance programs for low-income customers.
- 24/7 Emergency Response: Southwest Gas maintains a commitment to emergency response, offering round-the-clock services for gas leaks and other emergencies, ensuring safety and rapid response to incidents.

Summary
Southwest Gas Holdings, Inc. is a well-established player in the natural gas sector, with extensive operations in gas utility services and midstream transportation and storage. The company focuses on delivering reliable natural gas to millions of customers while innovating through energy efficiency and sustainability initiatives. Its continued investment in infrastructure and customer services underlines its position as a crucial utility provider in the regions it serves.