At December 31, 2021 and 2020, the Companies had the following lease assets and liabilities recorded in the Consolidated Balance Sheets:

	December 31, 2021		December 31, 2020
(millions)
Dominion Energy
Lease assets:
Operating lease assets⁽¹⁾	$	506	$	564
Finance lease assets⁽²⁾		144		148
Total lease assets	$	650	$	712
Lease liabilities:
Operating lease liabilities⁽³⁾	$	44	$	54
Finance lease liabilities⁽⁴⁾		36		32
Total lease liabilities - current		80		86
Operating lease liabilities ⁽⁵⁾		464		516
Finance lease liabilities⁽⁶⁾		112		108
Total lease liabilities - noncurrent		576		624
Total lease liabilities	$	656	$	710
Virginia Power
Operating lease assets⁽¹⁾	$	256	$	185
Finance lease assets⁽²⁾		71		45
Total lease assets	$	327	$	230
Lease liabilities:
Operating lease liabilities⁽³⁾	$	25	$	28
Finance lease liabilities⁽⁴⁾		13		8
Total lease liabilities - current		38		36
Operating lease liabilities ⁽⁵⁾		227		155
Finance lease liabilities⁽⁶⁾		57		36
Total lease liabilities - noncurrent		284		191
Total lease liabilities	$	322	$	227

In addition to the amounts disclosed above, Dominion Energy’s Consolidated Balance Sheets at December 31, 2021 and 2020 includes property, plant and equipment of $1.2 billion and $2.2 billion, respectively, and accumulated depreciation of $106 million and $68 million, respectively, related to facilities subject to power purchase agreements under which Dominion Energy is the lessor.

For the years ended December 31, 2021, 2020 and 2019, total lease cost associated with the Companies’ leasing arrangements consisted of the following:

	Year Ended December 31, 2021			Year Ended December 31, 2020		Year Ended December 31, 2019
(millions)
Dominion Energy
Finance lease cost:
Amortization	$	40		$	33	$	20
Interest		(3	)		—		4
Operating lease cost		66			68		79
Short-term lease cost		32			20		26
Variable lease cost		5			8		5
Total lease cost	$	140		$	129	$	134
Virginia Power
Finance lease cost:
Amortization	$	12		$	7	$	3
Interest		1			1		—
Operating lease cost	$	30		$	36	$	41
Short-term lease cost		19			12		13
Variable lease cost		1			4		2
Total lease cost	$	63		$	60	$	59

For the years ended December 31, 2021, 2020 and 2019, cash paid for amounts included in the measurement of the lease liabilities consisted of the following amounts, included in the Companies’ Consolidated Statements of Cash Flows:

	Year Ended December 31, 2021			Year Ended December 31, 2020		Year Ended December 31, 2019
(millions)
Dominion Energy
Operating cash flows for finance leases	$	(3	)	$	—	$	4
Operating cash flows for operating leases		103			96		111
Financing cash flows for finance leases		40			33		20
Virginia Power
Operating cash flows for finance leases	$	1		$	1	$	—
Operating cash flows for operating leases		53			52		56
Financing cash flows for finance leases		12			7		3

In addition to the amounts disclosed above, Dominion Energy’s Consolidated Statements of Income for the years ended December 31, 2021, 2020 and 2019, include $168 million, $175 million and $174 million, respectively, of rental revenue, included in operating revenue and $110 million, $102 million and $94 million, respectively, of depreciation expense, included in depreciation, depletion and amortization, related to facilities subject to power purchase agreements under which Dominion Energy is the lessor.

At December 31, 2021 and 2020, the weighted average remaining lease term and weighted discount rate for the Companies’ finance and operating leases were as follows:

	December 31, 2021			December 31, 2020
Dominion Energy
Weighted average remaining lease term - finance leases	5 years			5 years
Weighted average remaining lease term - operating leases	27 years			26 years
Weighted average discount rate - finance leases		2.77	%		3.17	%
Weighted average discount rate - operating leases		3.96	%		4.07	%
Virginia Power
Weighted average remaining lease term - finance leases	6 years			6 years
Weighted average remaining lease term - operating leases	25 years			21 years
Weighted average discount rate - finance leases		2.27	%		2.51	%
Weighted average discount rate - operating leases		4.00	%		4.26	%

Maturity of Lease Liabilities	Dominion Energy						Virginia Power
(millions)	Operating			Finance			Operating			Finance
2022	$	50		$	32		$	27		$	8
2023		41			39			21			14
2024		33			33			17			14
2025		27			18			13			13
2026		24			15			10			10
After 2026		577			22			240			17
Total undiscounted lease payments		752			159			328			76
Present value adjustment		(244	)		(11	)		(76	)		(6	)
Present value of lease liabilities	$	508		$	148		$	252		$	70

In December 2019, Dominion Energy signed an agreement with a lessor, as amended in May 2020, to construct and lease a new corporate office property in Richmond, Virginia. The lessor provided equity and had obtained financing commitments from debt investors, totaling $465 million, to fund the estimated project costs. In March 2021, Dominion Energy notified the lessor of its intention to terminate the leasing arrangement effective April 2021. As a result, Dominion Energy recorded a charge of $62 million ($46 million after-tax) in 2021, included in impairments of assets and other charges in its Consolidated Statements of Income, primarily for amounts required to be repaid to the lessor.

In December 2020, Dominion Energy signed an agreement with a lessor to complete construction of and lease a Jones Act compliant offshore wind installation vessel. This vessel is designed to handle current turbine technologies as well as next generation turbines. The lessor is providing equity and has obtained financing commitments from debt investors, totaling $550 million, to fund the estimated project costs. The project is expected to be completed by the end of 2023. Dominion Energy has been appointed to act as the construction agent for the lessor, during which time Dominion Energy will request cash draws from the lessor and debt investors to fund all project costs, which totaled $293 million as of December 31, 2021. If the project is terminated under certain events of default, Dominion Energy could be required to pay up to 100% of the then funded amount.

The initial lease term will commence once construction is substantially complete and the vessel is delivered and will mature in November 2027. At the end of the initial lease term, Dominion Energy can (i) extend the term of the lease for an additional term, subject to the approval of the participants, at current market terms, (ii) purchase the property for an amount equal to the outstanding project costs or, (iii) subject to certain terms and conditions, sell the property on behalf of the lessor to a third party using commercially reasonable efforts to obtain the highest cash purchase price for the property. If the project is sold and the proceeds from the sale are insufficient to repay the investors for the outstanding project costs, Dominion Energy may be required to make a payment to the lessor for the difference between the outstanding project costs and sale proceeds. Dominion Energy is not considered the owner during construction for financial accounting purposes and, therefore, will not reflect the construction activity in its consolidated financial statements. Dominion Energy expects to recognize a right-of-use asset and a corresponding finance lease liability at the commencement of the lease term. Dominion Energy will be considered the owner of the leased property for tax purposes, and as a result, will be entitled to tax deductions for depreciation and interest expense.