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Leases
 12 Months Ended
Dec. 31, 2022
Leases Leases
As of December 31, 2022, 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 four 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.
PSEG Power & 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. Certain leases contain variable payments.
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, 2022, 2021 and 2020 and any amounts capitalized as part of the cost of another asset, and the cash flows arising from lease transactions.
PSE&GPSEG Power & OtherTotal
Millions
Operating Lease Costs
Year Ended December 31, 2022
  Long-term Lease Costs$31 $25 $56 
  Short-term Lease Costs21 5 26 
  Variable Lease Costs2 11 13 
Total Operating Lease Costs$54 $41 $95 
Year Ended December 31, 2022
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities$17 $25 $42 
Weighted Average Remaining Lease Term in Years1179
Weighted Average Discount Rate3.5 %4.1 %3.9 %
PSE&GPSEG Power & OtherTotal
Millions
Operating Lease Costs
Year Ended December 31, 2021
  Long-term Lease Costs$24 $26 $50 
  Short-term Lease Costs36 6 42 
  Variable Lease Costs2 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 Years1289
Weighted Average Discount Rate3.4 %4.1 %3.8 %
PSE&GPSEG Power & OtherTotal
Millions
Operating Lease Costs
Year Ended December 31, 2020
  Long-term Lease Costs$26 $28 $54 
  Short-term Lease Costs38 7 45 
  Variable Lease Costs2 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 Years121111
Weighted Average Discount Rate3.5 %4.3 %4.0 %
Operating lease liabilities as of December 31, 2022 had the following maturities on an undiscounted basis:
PSE&GPSEG Power & OtherTotal
Millions
2023$15 $20 $35 
202412 16 28 
202510 15 25 
20268 15 23 
20278 16 24 
Thereafter56 44 100 
Total Minimum Lease Payments$109 $126 $235 
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, 2022
PSE&GPSEG Power & OtherTotal
Millions
Undiscounted Cash Flows$109 $126 $235 
Reconciling Amount due to Discount Rate(20)(18)(38)
Total Discounted Operating Lease Liabilities$89 $108 $197 
As of December 31, 2021
PSE&GPSEG Power & OtherTotal
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, 2022, the current portions of Operating Lease Liabilities included in Other Current Liabilities were $28 million and $12 million for PSEG and PSE&G, respectively. 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.
Lessor
PSEG Power & Other
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 in real estate assets with remaining terms through 2049. In 2022, Energy Holdings recorded pre-tax impairments of $78 million related to one of its domestic energy generating facilities and its real estate assets. As of December 31, 2022, Energy Holdings’ property subject to these leases had a total carrying value of $51 million, including Assets Held for Sale of $20 million.
Energy Holdings was previously the lessor in operating leases for real estate assets which were sold in March 2020.
PSEG Nuclear, LLC, a wholly owned subsidiary of PSEG Power, is the lessor in an operating lease for 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 in June 2021, 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.
The following is the operating lease income for the years ended December 31, 2022, 2021 and 2020:
Operating Lease IncomeMillions
Year Ended December 31, 2022
Fixed Lease Income$31 
Variable Lease Income— 
Total Operating Lease Income$31 
Year Ended December 31, 2021
Fixed Lease Income$23 
Variable Lease Income12 
Total Operating Lease Income$35 
Year Ended December 31, 2020
Fixed Lease Income$15 
Variable Lease Income26 
Total Operating Lease Income$41 
Operating leases had the following minimum future fixed lease receipts as of December 31, 2022:
Millions
2023$19 
202419 
202519 
202619 
202714 
Thereafter124 
Total Minimum Future Lease Receipts$214 
Public Service Electric and Gas Company  
Leases Leases
As of December 31, 2022, 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 four 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.
PSEG Power & 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. Certain leases contain variable payments.
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, 2022, 2021 and 2020 and any amounts capitalized as part of the cost of another asset, and the cash flows arising from lease transactions.
PSE&GPSEG Power & OtherTotal
Millions
Operating Lease Costs
Year Ended December 31, 2022
  Long-term Lease Costs$31 $25 $56 
  Short-term Lease Costs21 5 26 
  Variable Lease Costs2 11 13 
Total Operating Lease Costs$54 $41 $95 
Year Ended December 31, 2022
Cash Paid for Amounts Included in the Measurement of Operating Lease Liabilities$17 $25 $42 
Weighted Average Remaining Lease Term in Years1179
Weighted Average Discount Rate3.5 %4.1 %3.9 %
PSE&GPSEG Power & OtherTotal
Millions
Operating Lease Costs
Year Ended December 31, 2021
  Long-term Lease Costs$24 $26 $50 
  Short-term Lease Costs36 6 42 
  Variable Lease Costs2 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 Years1289
Weighted Average Discount Rate3.4 %4.1 %3.8 %
PSE&GPSEG Power & OtherTotal
Millions
Operating Lease Costs
Year Ended December 31, 2020
  Long-term Lease Costs$26 $28 $54 
  Short-term Lease Costs38 7 45 
  Variable Lease Costs2 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 Years121111
Weighted Average Discount Rate3.5 %4.3 %4.0 %
Operating lease liabilities as of December 31, 2022 had the following maturities on an undiscounted basis:
PSE&GPSEG Power & OtherTotal
Millions
2023$15 $20 $35 
202412 16 28 
202510 15 25 
20268 15 23 
20278 16 24 
Thereafter56 44 100 
Total Minimum Lease Payments$109 $126 $235 
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, 2022
PSE&GPSEG Power & OtherTotal
Millions
Undiscounted Cash Flows$109 $126 $235 
Reconciling Amount due to Discount Rate(20)(18)(38)
Total Discounted Operating Lease Liabilities$89 $108 $197 
As of December 31, 2021
PSE&GPSEG Power & OtherTotal
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, 2022, the current portions of Operating Lease Liabilities included in Other Current Liabilities were $28 million and $12 million for PSEG and PSE&G, respectively. 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.
Lessor
PSEG Power & Other
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 in real estate assets with remaining terms through 2049. In 2022, Energy Holdings recorded pre-tax impairments of $78 million related to one of its domestic energy generating facilities and its real estate assets. As of December 31, 2022, Energy Holdings’ property subject to these leases had a total carrying value of $51 million, including Assets Held for Sale of $20 million.
Energy Holdings was previously the lessor in operating leases for real estate assets which were sold in March 2020.
PSEG Nuclear, LLC, a wholly owned subsidiary of PSEG Power, is the lessor in an operating lease for 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 in June 2021, 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.
The following is the operating lease income for the years ended December 31, 2022, 2021 and 2020:
Operating Lease IncomeMillions
Year Ended December 31, 2022
Fixed Lease Income$31 
Variable Lease Income— 
Total Operating Lease Income$31 
Year Ended December 31, 2021
Fixed Lease Income$23 
Variable Lease Income12 
Total Operating Lease Income$35 
Year Ended December 31, 2020
Fixed Lease Income$15 
Variable Lease Income26 
Total Operating Lease Income$41 
Operating leases had the following minimum future fixed lease receipts as of December 31, 2022:
Millions
2023$19 
202419 
202519 
202619 
202714 
Thereafter124 
Total Minimum Future Lease Receipts$214