SCE enters into various agreements to purchase power, electric capacity and other energy products that may be accounted for as leases when SCE has dispatch rights that determine when and how a plant runs. SCE also leases property and equipment primarily related to vehicles, office space and other equipment. The terms of the contracts included in the table below are primarily 3 to 20 years for PPA leases, 5 to 72 years for office leases, and 5 to 13 years for the remaining other operating leases.

The following table summarizes SCE's lease payments for operating and finance leases as of September 30, 2021:

1	Excludes expected purchases from most renewable energy contracts, which do not meet the definition of a lease payment since renewable power generation is contingent on external factors.

2	Excludes escalation clauses based on consumer price or other indices and residual value guarantees that are not considered probable at the commencement date of the lease.

3	Lease payments are discounted to their present value SCE's incremental borrowing rates.

Supplemental balance sheet information related to SCE's leases was as follows:


	September 30,		December 31,
(in millions)	2021		2020
Operating leases:
Operating lease right-of-use ("ROU") assets¹	$	1,525	$	1,085
Current portion of operating lease liabilities		355		214
Operating lease liabilities		1,170		871
Total operating lease liabilities¹	$	1,525	$	1,085

Finance leases included in:
Utility property, plant and equipment, gross	$	4	$	4
Accumulated depreciation		(1)		—
Utility property, plant and equipment, net	$	3	$	4
Other current liabilities	$	—	$	—
Other long-term liabilities		3		4
Total finance lease liabilities	$	3	$	4

1	During the nine months ended September 30, 2021, three SCE PPA operating lease contracts commenced and one power contract was amended resulting in a total of $610 million additions in ROU assets and lease liabilities.

The timing of SCE's recognition of the lease expense conforms to ratemaking treatment for SCE's recovery of the cost of electricity and is included in purchased power for operating leases and interest and amortization expense for finance leases. The following table summarizes the components of SCE's lease expense:


	Three months ended September 30,				Nine months ended September 30,
(in millions)	2021		2020		2021		2020
PPA leases:
Operating lease cost	$	136	$	35	$	199	$	74
Finance lease cost		—		1		—		2
Variable lease cost¹		893		676		2,163		1,582
Total PPA lease cost	$	1,029	$	712	$	2,362	$	1,658
Other operating leases cost		12		11		35		35
Total lease cost	$	1,041	$	723	$	2,397	$	1,693

1	Includes lease costs from renewable energy contracts where payments are based on contingent external factors such as wind, hydro and solar power generation.

Other information related to leases was as follows:


	Nine months ended			Nine months ended
(in millions, except lease term and discount rate)	September 30, 2021			September 30, 2020
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
PPA leases	$	199		$	74
Other leases		33			33

ROU assets obtained in exchange for lease obligations:
PPA operating leases	$	610		$	463
Other operating leases		38			42

Weighted average remaining lease term (in years):
Operating leases
PPA leases		10.26			9.83
Other leases		11.67			12.35
PPA Finance leases		15.92			10.90

Weighted average discount rate:
Operating leases
PPA leases		2.82	%		3.08	%
Other leases		3.47	%		3.74	%
PPA Finance leases		11.29	%		8.83	%