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Leases

12 Months Ended

Dec. 31, 2021

As of December 31, 2021, PSEG and its subsidiaries were both a lessee and a lessor in operating leases.

Lessee

PSE&G

PSE&G has operating leases for office space for customer service centers, rooftops and land for its Solar 4 All® facilities, equipment, vehicles and land for certain electric substations. These leases have remaining lease terms through 2040, some of which include options to extend the leases for up to five 5-year terms or one 10-year term; and two include options to extend the leases for one 45-year and one 48-year term, respectively. Some leases have fixed rent payments that have escalations based on certain indices, such as the CPI. Certain leases contain variable payments.

Other

PSEG Power has operating leases for buildings, merchant transmission and equipment. These leases have remaining terms through 2025, one of which includes an option to extend the lease for up to one 5-year term. One lease has fixed rent payments that has escalations based on the CPI Index. Certain leases contain variable payments. Except for operating lease costs, the following tables for lessees exclude amounts in 2021 which have been classified as Held for Sale. For additional information see Note 4. Early Plant Retirements/Asset Dispositions and Impairments.

Services has operating leases for real estate and office equipment. These leases have remaining terms through 2030. Services’ lease for its headquarters, which ends in 2030, includes options to extend for two 5-year terms.

Operating Lease Costs

The following amounts relate to total operating lease costs, including both amounts recognized in the Consolidated Statements of Operations during the years ended December 31, 2021, 2020 and 2019 and any amounts capitalized as part of the cost of another asset, and the cash flows arising from lease transactions.



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2021
Long-term Lease Costs	$	24		$	26		$	50
Short-term Lease Costs	36			6			42
Variable Lease Costs	2			18			20
Total Operating Lease Costs	$	62		$	50		$	112



Year Ended December 31, 2021
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	26		$	43

Weighted Average Remaining Lease Term in Years	12			8			9
Weighted Average Discount Rate	3.4		%	4.1		%	3.8		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2020
Long-term Lease Costs	$	26		$	28		$	54
Short-term Lease Costs	38			7			45
Variable Lease Costs	2			29			31
Total Operating Lease Costs	$	66		$	64		$	130



Year Ended December 31, 2020
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	28		$	45

Weighted Average Remaining Lease Term in Years	12			11			11
Weighted Average Discount Rate	3.5		%	4.3		%	4.0		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2019
Long-term Lease Costs	$	24		$	28		$	52
Short-term Lease Costs	14			10			24
Variable Lease Costs	2			20			22
Total Operating Lease Costs	$	40		$	58		$	98



Year Ended December 31, 2019
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	16		$	26		$	42

Weighted Average Remaining Lease Term in Years	13			11			12
Weighted Average Discount Rate	3.6		%	4.3		%	4.1		%

Operating lease liabilities as of December 31, 2021 had the following maturities on an undiscounted basis:



	PSE&G		Other		Total
	Millions
2022	$	15	$	25	$	40
2023	12		20		32
2024	10		16		26
2025	9		16		25
2026	8		15		23
Thereafter	63		60		123
Total Minimum Lease Payments	$	117	$	152	$	269

The following is a reconciliation of the undiscounted cash flows to the discounted Operating Lease Liabilities recognized on the Consolidated Balance Sheets:



	As of December 31, 2021
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	117	$	152	$	269
Reconciling Amount due to Discount Rate	(22)		(23)		(45)
Total Discounted Operating Lease Liabilities	$	95	$	129	$	224

	As of December 31, 2020
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	127	$	239	$	366
Reconciling Amount due to Discount Rate	(26)		(54)		(80)
Total Discounted Operating Lease Liabilities	$	101	$	185	$	286

As of December 31, 2021, the current portions of Operating Lease Liabilities included in Other Current Liabilities were $33 million and $12 million for PSEG and PSE&G, respectively. As of December 31, 2020, the current portions of Operating Lease Liabilities included in Other Current Liabilities were $34 million and $13 million for PSEG and PSE&G, respectively.

Lessor

Other

In the third quarter of 2021, PSEG Nuclear, LLC, a wholly owned subsidiary of PSEG Power, entered into an operating lease as the lessor to lease certain parcels of land with terms of 28 years from commencement, plus five optional renewal periods of ten years.

Prior to the sale of Solar Source, certain of PSEG Power’s sales agreements related to its solar generating plants qualified as operating leases. Lease income was based on solar energy generation; therefore, all rental income recorded under these leases was variable.

Energy Holdings is the lessor in leveraged leases. See Note 9. Long-Term Investments and Note 10. Financing Receivables.

Energy Holdings is the lessor in two operating leases for domestic energy generation facilities with remaining terms through 2036, one of which has an optional renewal period and real estate assets with remaining terms through 2049. As of December 31, 2021, Energy Holdings’ property subject to these leases had a total carrying value of $124 million.

Energy Holdings was previously the lessor in operating leases for real estate assets which were sold in March 2020.

The following is the operating lease income for the years ended December 31, 2021, 2020 and 2019:



Operating Lease Income	Millions




Year Ended December 31, 2021
Fixed Lease Income	$	23
Variable Lease Income	12
Total Operating Lease Income	$	35

Year Ended December 31, 2020
Fixed Lease Income	$	15
Variable Lease Income	26
Total Operating Lease Income	$	41

Year Ended December 31, 2019
Fixed Lease Income	$	22
Variable Lease Income	23
Total Operating Lease Income	$	45

Operating leases had the following minimum future fixed lease receipts as of December 31, 2021:



	Millions
2022	$	18
2023	18
2024	19
2025	19
2026	50
Thereafter	183
Total Minimum Future Lease Receipts	$	307

Leases

As of December 31, 2021, PSEG and its subsidiaries were both a lessee and a lessor in operating leases.

Lessee

PSE&G

Other

Operating Lease Costs



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2021
Long-term Lease Costs	$	24		$	26		$	50
Short-term Lease Costs	36			6			42
Variable Lease Costs	2			18			20
Total Operating Lease Costs	$	62		$	50		$	112



Year Ended December 31, 2021
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	26		$	43

Weighted Average Remaining Lease Term in Years	12			8			9
Weighted Average Discount Rate	3.4		%	4.1		%	3.8		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2020
Long-term Lease Costs	$	26		$	28		$	54
Short-term Lease Costs	38			7			45
Variable Lease Costs	2			29			31
Total Operating Lease Costs	$	66		$	64		$	130



Year Ended December 31, 2020
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	28		$	45

Weighted Average Remaining Lease Term in Years	12			11			11
Weighted Average Discount Rate	3.5		%	4.3		%	4.0		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2019
Long-term Lease Costs	$	24		$	28		$	52
Short-term Lease Costs	14			10			24
Variable Lease Costs	2			20			22
Total Operating Lease Costs	$	40		$	58		$	98



Year Ended December 31, 2019
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	16		$	26		$	42

Weighted Average Remaining Lease Term in Years	13			11			12
Weighted Average Discount Rate	3.6		%	4.3		%	4.1		%

Operating lease liabilities as of December 31, 2021 had the following maturities on an undiscounted basis:



	PSE&G		Other		Total
	Millions
2022	$	15	$	25	$	40
2023	12		20		32
2024	10		16		26
2025	9		16		25
2026	8		15		23
Thereafter	63		60		123
Total Minimum Lease Payments	$	117	$	152	$	269

The following is a reconciliation of the undiscounted cash flows to the discounted Operating Lease Liabilities recognized on the Consolidated Balance Sheets:



	As of December 31, 2021
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	117	$	152	$	269
Reconciling Amount due to Discount Rate	(22)		(23)		(45)
Total Discounted Operating Lease Liabilities	$	95	$	129	$	224

	As of December 31, 2020
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	127	$	239	$	366
Reconciling Amount due to Discount Rate	(26)		(54)		(80)
Total Discounted Operating Lease Liabilities	$	101	$	185	$	286

Lessor

Other

Energy Holdings is the lessor in leveraged leases. See Note 9. Long-Term Investments and Note 10. Financing Receivables.

Energy Holdings was previously the lessor in operating leases for real estate assets which were sold in March 2020.

The following is the operating lease income for the years ended December 31, 2021, 2020 and 2019:



Operating Lease Income	Millions




Year Ended December 31, 2021
Fixed Lease Income	$	23
Variable Lease Income	12
Total Operating Lease Income	$	35

Year Ended December 31, 2020
Fixed Lease Income	$	15
Variable Lease Income	26
Total Operating Lease Income	$	41

Year Ended December 31, 2019
Fixed Lease Income	$	22
Variable Lease Income	23
Total Operating Lease Income	$	45

Operating leases had the following minimum future fixed lease receipts as of December 31, 2021:



	Millions
2022	$	18
2023	18
2024	19
2025	19
2026	50
Thereafter	183
Total Minimum Future Lease Receipts	$	307

Public Service Electric and Gas Company

Leases

As of December 31, 2021, PSEG and its subsidiaries were both a lessee and a lessor in operating leases.

Lessee

PSE&G

Other

Operating Lease Costs



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2021
Long-term Lease Costs	$	24		$	26		$	50
Short-term Lease Costs	36			6			42
Variable Lease Costs	2			18			20
Total Operating Lease Costs	$	62		$	50		$	112



Year Ended December 31, 2021
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	26		$	43

Weighted Average Remaining Lease Term in Years	12			8			9
Weighted Average Discount Rate	3.4		%	4.1		%	3.8		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2020
Long-term Lease Costs	$	26		$	28		$	54
Short-term Lease Costs	38			7			45
Variable Lease Costs	2			29			31
Total Operating Lease Costs	$	66		$	64		$	130



Year Ended December 31, 2020
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	28		$	45

Weighted Average Remaining Lease Term in Years	12			11			11
Weighted Average Discount Rate	3.5		%	4.3		%	4.0		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2019
Long-term Lease Costs	$	24		$	28		$	52
Short-term Lease Costs	14			10			24
Variable Lease Costs	2			20			22
Total Operating Lease Costs	$	40		$	58		$	98



Year Ended December 31, 2019
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	16		$	26		$	42

Weighted Average Remaining Lease Term in Years	13			11			12
Weighted Average Discount Rate	3.6		%	4.3		%	4.1		%

Operating lease liabilities as of December 31, 2021 had the following maturities on an undiscounted basis:



	PSE&G		Other		Total
	Millions
2022	$	15	$	25	$	40
2023	12		20		32
2024	10		16		26
2025	9		16		25
2026	8		15		23
Thereafter	63		60		123
Total Minimum Lease Payments	$	117	$	152	$	269

The following is a reconciliation of the undiscounted cash flows to the discounted Operating Lease Liabilities recognized on the Consolidated Balance Sheets:



	As of December 31, 2021
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	117	$	152	$	269
Reconciling Amount due to Discount Rate	(22)		(23)		(45)
Total Discounted Operating Lease Liabilities	$	95	$	129	$	224

	As of December 31, 2020
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	127	$	239	$	366
Reconciling Amount due to Discount Rate	(26)		(54)		(80)
Total Discounted Operating Lease Liabilities	$	101	$	185	$	286

Lessor

Other

Energy Holdings is the lessor in leveraged leases. See Note 9. Long-Term Investments and Note 10. Financing Receivables.

Energy Holdings was previously the lessor in operating leases for real estate assets which were sold in March 2020.

The following is the operating lease income for the years ended December 31, 2021, 2020 and 2019:



Operating Lease Income	Millions




Year Ended December 31, 2021
Fixed Lease Income	$	23
Variable Lease Income	12
Total Operating Lease Income	$	35

Year Ended December 31, 2020
Fixed Lease Income	$	15
Variable Lease Income	26
Total Operating Lease Income	$	41

Year Ended December 31, 2019
Fixed Lease Income	$	22
Variable Lease Income	23
Total Operating Lease Income	$	45

Operating leases had the following minimum future fixed lease receipts as of December 31, 2021:



	Millions
2022	$	18
2023	18
2024	19
2025	19
2026	50
Thereafter	183
Total Minimum Future Lease Receipts	$	307

Leases

As of December 31, 2021, PSEG and its subsidiaries were both a lessee and a lessor in operating leases.

Lessee

PSE&G

Other

Operating Lease Costs



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2021
Long-term Lease Costs	$	24		$	26		$	50
Short-term Lease Costs	36			6			42
Variable Lease Costs	2			18			20
Total Operating Lease Costs	$	62		$	50		$	112



Year Ended December 31, 2021
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	26		$	43

Weighted Average Remaining Lease Term in Years	12			8			9
Weighted Average Discount Rate	3.4		%	4.1		%	3.8		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2020
Long-term Lease Costs	$	26		$	28		$	54
Short-term Lease Costs	38			7			45
Variable Lease Costs	2			29			31
Total Operating Lease Costs	$	66		$	64		$	130



Year Ended December 31, 2020
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	17		$	28		$	45

Weighted Average Remaining Lease Term in Years	12			11			11
Weighted Average Discount Rate	3.5		%	4.3		%	4.0		%



	PSE&G			Other			Total
	Millions
Operating Lease Costs





Year Ended December 31, 2019
Long-term Lease Costs	$	24		$	28		$	52
Short-term Lease Costs	14			10			24
Variable Lease Costs	2			20			22
Total Operating Lease Costs	$	40		$	58		$	98



Year Ended December 31, 2019
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities	$	16		$	26		$	42

Weighted Average Remaining Lease Term in Years	13			11			12
Weighted Average Discount Rate	3.6		%	4.3		%	4.1		%

Operating lease liabilities as of December 31, 2021 had the following maturities on an undiscounted basis:



	PSE&G		Other		Total
	Millions
2022	$	15	$	25	$	40
2023	12		20		32
2024	10		16		26
2025	9		16		25
2026	8		15		23
Thereafter	63		60		123
Total Minimum Lease Payments	$	117	$	152	$	269

The following is a reconciliation of the undiscounted cash flows to the discounted Operating Lease Liabilities recognized on the Consolidated Balance Sheets:



	As of December 31, 2021
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	117	$	152	$	269
Reconciling Amount due to Discount Rate	(22)		(23)		(45)
Total Discounted Operating Lease Liabilities	$	95	$	129	$	224

	As of December 31, 2020
	PSE&G		Other		Total
	Millions
Undiscounted Cash Flows	$	127	$	239	$	366
Reconciling Amount due to Discount Rate	(26)		(54)		(80)
Total Discounted Operating Lease Liabilities	$	101	$	185	$	286

Lessor

Other

Energy Holdings is the lessor in leveraged leases. See Note 9. Long-Term Investments and Note 10. Financing Receivables.

Energy Holdings was previously the lessor in operating leases for real estate assets which were sold in March 2020.

The following is the operating lease income for the years ended December 31, 2021, 2020 and 2019:



Operating Lease Income	Millions




Year Ended December 31, 2021
Fixed Lease Income	$	23
Variable Lease Income	12
Total Operating Lease Income	$	35

Year Ended December 31, 2020
Fixed Lease Income	$	15
Variable Lease Income	26
Total Operating Lease Income	$	41

Year Ended December 31, 2019
Fixed Lease Income	$	22
Variable Lease Income	23
Total Operating Lease Income	$	45

Operating leases had the following minimum future fixed lease receipts as of December 31, 2021:



	Millions
2022	$	18
2023	18
2024	19
2025	19
2026	50
Thereafter	183
Total Minimum Future Lease Receipts	$	307