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Leases
 12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
Leases Leases
We lease certain buildings and plant and equipment. Our leases have reasonably assured remaining lease terms of up to 12 years. Certain leases include options to renew for up to 15 years. At lease inception, we determine the lease term by assuming the exercise of those renewal options that are reasonably certain. Some leases have variable payments, however, because they are not based on an index or rate, they are not included in the measurement of ROU assets and lease liabilities. Variable payments for real estate leases relate primarily to common area maintenance, insurance, taxes and utilities associated with the properties. Variable payments for equipment leases relate primarily to hours, miles, or other quantifiable usage factors, which are not determinable at the time of lease inception. These variable payments are expensed as incurred. The discount rate applied to our leases in determining the present value of lease payments is our incremental borrowing rate based on the information available at the commencement date. Leases with an initial term of 12 months or less are not recorded in our consolidated balance sheets and we recognize lease expense for these leases on a straight-line basis over the lease term.
Operating lease costs consisted of the following:
As of December 31,
202420232022
(in millions)
Operating lease costs$23 $18 $17 
Variable lease costs— 1 1 
Short-term lease costs4 4 4 
Total operating lease costs$27 $23 $22 
Lease costs related to the amortization of finance lease assets and interest on finance lease liabilities were not material for the years ended December 31, 2024, 2023 and 2022.
Future lease payments under non-cancellable leases were as follows:
As of December 31, 2024
Operating LeasesFinance LeasesTotal
(in millions)
2025$25 $2 $27 
202622 2 24 
202719 2 21 
202814 2 16 
202911 2 13 
Thereafter15 10 25 
Total undiscounted lease payments106 20 126 
Less: imputed interest(13)(5)(18)
Present value of lease liabilities$93 $15 $108 
As of December 31, 2024, we had an additional $17 million in commitments related to operating leases executed that have not yet commenced. The leases are expected to commence during 2025.
Lease liabilities and ROU assets included in our consolidated balance sheets were as follows:
As of December 31,
20242023
(in millions)
Operating leasesBalance Sheet Classification
Right-of-use assetsOperating lease right-of-use assets$90 $56 
Current lease liabilitiesCurrent operating lease liabilities$20 $16 
Non-current lease liabilitiesLong-term operating lease liabilities73 42 
Total operating lease liabilities$93 $58 
Finance leasesBalance Sheet Classification
Right-of-use assetsOther assets$15 $16 
Current lease liabilitiesAccrued and other current liabilities$1 $1 
Non-current lease liabilitiesOther liabilities14 15 
Total finance lease liabilities$15 $16 
During the years ended December 31, 2024 and 2023, new leases and lease modifications resulted in the recognition of operating ROU assets and corresponding operating lease liabilities totaling $53 million and $6 million, respectively. During the year ended December 31, 2023, new leases resulted in the recognition of finance lease ROU assets and corresponding finance lease liabilities totaling $6 million. New leases and lease modifications resulting in the recognition of finance lease ROU assets and corresponding finance lease liabilities were not material during the year ended December 31, 2024.
During the years ended December 31, 2024, 2023 and 2022, cash flows from operating activities in the consolidated statements of cash flows reflected $21 million, $18 million and $17 million, respectively, of payments for operating lease liabilities. Payments for finance lease liabilities in the years ended December 31, 2024, 2023 and 2022 were not material.
The weighted average remaining lease term and weighted average discount rates were as follows:
As of December 31, 2024
Operating LeasesFinance Leases
Weighted-average remaining lease term (in years)5.0610.69
Weighted-average discount rate4.95%5.53%
Leases Leases
We lease certain buildings and plant and equipment. Our leases have reasonably assured remaining lease terms of up to 12 years. Certain leases include options to renew for up to 15 years. At lease inception, we determine the lease term by assuming the exercise of those renewal options that are reasonably certain. Some leases have variable payments, however, because they are not based on an index or rate, they are not included in the measurement of ROU assets and lease liabilities. Variable payments for real estate leases relate primarily to common area maintenance, insurance, taxes and utilities associated with the properties. Variable payments for equipment leases relate primarily to hours, miles, or other quantifiable usage factors, which are not determinable at the time of lease inception. These variable payments are expensed as incurred. The discount rate applied to our leases in determining the present value of lease payments is our incremental borrowing rate based on the information available at the commencement date. Leases with an initial term of 12 months or less are not recorded in our consolidated balance sheets and we recognize lease expense for these leases on a straight-line basis over the lease term.
Operating lease costs consisted of the following:
As of December 31,
202420232022
(in millions)
Operating lease costs$23 $18 $17 
Variable lease costs— 1 1 
Short-term lease costs4 4 4 
Total operating lease costs$27 $23 $22 
Lease costs related to the amortization of finance lease assets and interest on finance lease liabilities were not material for the years ended December 31, 2024, 2023 and 2022.
Future lease payments under non-cancellable leases were as follows:
As of December 31, 2024
Operating LeasesFinance LeasesTotal
(in millions)
2025$25 $2 $27 
202622 2 24 
202719 2 21 
202814 2 16 
202911 2 13 
Thereafter15 10 25 
Total undiscounted lease payments106 20 126 
Less: imputed interest(13)(5)(18)
Present value of lease liabilities$93 $15 $108 
As of December 31, 2024, we had an additional $17 million in commitments related to operating leases executed that have not yet commenced. The leases are expected to commence during 2025.
Lease liabilities and ROU assets included in our consolidated balance sheets were as follows:
As of December 31,
20242023
(in millions)
Operating leasesBalance Sheet Classification
Right-of-use assetsOperating lease right-of-use assets$90 $56 
Current lease liabilitiesCurrent operating lease liabilities$20 $16 
Non-current lease liabilitiesLong-term operating lease liabilities73 42 
Total operating lease liabilities$93 $58 
Finance leasesBalance Sheet Classification
Right-of-use assetsOther assets$15 $16 
Current lease liabilitiesAccrued and other current liabilities$1 $1 
Non-current lease liabilitiesOther liabilities14 15 
Total finance lease liabilities$15 $16 
During the years ended December 31, 2024 and 2023, new leases and lease modifications resulted in the recognition of operating ROU assets and corresponding operating lease liabilities totaling $53 million and $6 million, respectively. During the year ended December 31, 2023, new leases resulted in the recognition of finance lease ROU assets and corresponding finance lease liabilities totaling $6 million. New leases and lease modifications resulting in the recognition of finance lease ROU assets and corresponding finance lease liabilities were not material during the year ended December 31, 2024.
During the years ended December 31, 2024, 2023 and 2022, cash flows from operating activities in the consolidated statements of cash flows reflected $21 million, $18 million and $17 million, respectively, of payments for operating lease liabilities. Payments for finance lease liabilities in the years ended December 31, 2024, 2023 and 2022 were not material.
The weighted average remaining lease term and weighted average discount rates were as follows:
As of December 31, 2024
Operating LeasesFinance Leases
Weighted-average remaining lease term (in years)5.0610.69
Weighted-average discount rate4.95%5.53%