As disclosed in Note 2, the Company adopted ASC 842 as of January 1, 2022 under the modified retrospective transition method. Prior to the adoption of ASC 842, the Company accounted for leases in accordance with ASC 840, Leases.

The Company has entered into agreements with Site Hosts, which allow the Company to operate charging stations on the Site Hosts’ property. Additionally, the Company leases offices, off-site charging hubs, a warehouse and laboratory space under agreements with third-party landlords. The agreements with the Site Hosts and landlords are deemed to be operating leases. Original lease terms generally range from one to 15 years and certain leases contain renewal options that can extend the term for up to an additional seven years. The Company has not entered into any finance leases.

The Company has estimated operating lease commitments of $53.0 million for leases where the Company has not yet taken possession of the underlying asset as of December 31, 2022. As such, the related operating lease right-of-use assets and operating lease liabilities have not been recognized in the Company’s consolidated balance sheet as of December 31, 2022.

For the year ended December 31, 2022, the Company’s lease costs consisted of the following:

¹Rental expense for operating leases recorded in accordance with ASC 840 was $3.2 million for the year ended December 31, 2021.

As of December 31, 2022, the maturities of operating lease liabilities under ASC 842 for the years ending December 31, were as follows:


(in thousands)
2023	$	8,855
2024		9,005
2025		8,112
2026		7,620
2027		7,010
Thereafter		35,804
Total undiscounted operating lease payments		76,406
Less: imputed interest		(25,759)
Total discounted operating lease liabilities	$	50,647

As of December 31, 2021, the maturities of operating lease liabilities under ASC 840, Leases, for the years ending December 31, were as follows:


(in thousands)
2022	$	3,486
2023		3,515
2024		2,987
2025		2,093
2026		1,767
Thereafter		5,570
	$	19,418

Other supplemental and cash flow information, for the year ended December 31, 2022, consisted of the following:


(dollars in thousands)
Weighted-average remaining lease term		9.0 years
Weighted-average discount rate		8.99	%
Cash paid for amounts included in measurement of operating lease liabilities	$	5,323
Right-of-use assets obtained in exchange for new operating lease liabilities	$	33,457

Lessor Accounting

The Company leases charging equipment, charging stations and other technical installations and subleases properties leased from Site Hosts to third parties under operating leases where EVgo is the lessor. Initial lease terms are generally five to 10 years with renewal options.

Since the leasing arrangements the Company enters into with lessees are operating leases, the underlying asset is carried at its carrying value as owned and operated systems within property, equipment and software, net, or included in operating lease right-of-use assets on the consolidated balance sheets.

For the year ended December 31, 2022, the Company’s lease income consisted of the following components:


(in thousands)
Operating lease income:
Fixed lease income	$	810
Sublease income		384
Total lease income¹	$	1,194

¹Lease income recorded in accordance with ASC 840 was $0.9 million for the year ended December 31, 2021.

As of December 31, 2022, future minimum rental payments due to the Company as lessor under operating leases (including subleases) for the Company’s fiscal years ending December 31, were as follows:


(in thousands)
2023	$	1,877
2024		1,555
2025		663
2026		242
	$	4,337

The components of charging equipment, charging stations, land, and subleased host sites leased to third parties under operating leases, which are included within the Company’s property, equipment and software, net, and operating lease right-of-use-assets were as follows as of:


	December 31,		December 31,
(in thousands)	2022		2021
Charging station equipment and construction costs	$	3,557	$	4,114
Land and building		10,507		—
Less: accumulated depreciation		(980)		(815)
Property, equipment and software, net	$	13,084	$	3,299

Operating lease right-of-use assets	$	5,554	$	—