LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671

Leases

LEASES (Entergy Corporation, Entergy Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, Entergy Mississippi, Entergy New Orleans, Entergy Texas, and System Energy)

General

As of December 31, 2014, Entergy had capital leases and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):



Year	Operating Leases		Capital Leases
	(In Thousands)
2015		$90,010		$4,615
2016	77,060		4,457
2017	62,103		4,457
2018	49,630		3,672
2019	47,527		2,887
Years thereafter	95,530		27,664
Minimum lease payments	421,860		47,752
Less: Amount representing interest	—		15,773
Present value of net minimum lease payments		$421,860		$31,979

Total rental expenses for all leases (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions) amounted to $59 million in 2014, $63.7 million in 2013, and $69.9 million in 2012.

As of December 31, 2014 the Registrant Subsidiaries had a capital lease and non-cancelable operating leases for equipment, buildings, vehicles, and fuel storage facilities with minimum lease payments as follows (excluding power purchase agreement operating leases, nuclear fuel leases and the Grand Gulf and Waterford 3 sale and leaseback transactions, all of which are discussed elsewhere):

Capital Leases



Year	Entergy Mississippi
	(in Thousands)
2015		$1,570
2016	1,570
2017	1,570
2018	785
2019	—
Years thereafter	—
Minimum lease payments	5,495
Less: Amount representing interest	656
Present value of net minimum lease payments		$4,839

Operating Leases



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas
	(In Thousands)
2015		$28,647		$12,643		$11,006		$6,885		$2,115		$5,837
2016	23,674		10,880		9,695		5,388		1,856		5,111
2017	16,501		10,035		7,784		4,020		1,587		4,239
2018	10,736		9,100		6,343		3,376		1,264		3,707
2019	11,365		10,795		5,003		3,073		1,087		2,719
Years thereafter	8,412		26,671		5,458		3,212		2,227		2,981
Minimum lease payments		$99,335		$80,124		$45,289		$25,954		$10,136		$24,594

Rental Expenses



Year	Entergy Arkansas		Entergy Gulf States Louisiana		Entergy Louisiana		Entergy Mississippi		Entergy New Orleans		Entergy Texas		System Energy
	(In Millions)
2014		$12.0		$10.9		$9.8		$4.3		$1.2		$3.8		$2.0
2013		$12.0		$10.9		$10.1		$4.6		$1.3		$4.1		$2.5
2012		$12.6		$11.9		$11.2		$5.5		$1.5		$6.4		$1.5

In addition to the above rental expense, railcar operating lease payments and oil tank facilities lease payments are recorded in fuel expense in accordance with regulatory treatment. Railcar operating lease payments were $4.8 million in 2014, $8.6 million in 2013, and $8.5 million in 2012 for Entergy Arkansas and $1.7 million in 2014, $2.2 million in 2013, and $1.7 million in 2012 for Entergy Gulf States Louisiana. Oil tank facilities lease payments for Entergy Mississippi were $1.6 million in 2014, $3.4 million in 2013, and $3.4 million in 2012.

Power Purchase Agreements

As of December 31, 2014, Entergy Texas had a power purchase agreement that is accounted for as an operating lease under the accounting standards. The lease payments are recovered in fuel expense in accordance with regulatory treatment. The minimum lease payments under the power purchase agreement are as follows:



Year	Entergy Texas (a)		Entergy
	(In Thousands)
2015		$28,450		$28,450
2016	29,104		29,104
2017	29,772		29,772
2018	30,458		30,458
2019	31,158		31,158
Years thereafter	74,664		74,664
Minimum lease payments	223,606		223,606

(a) Amounts reflect 100% of minimum payments. Under a separate contract, Entergy Gulf States Louisiana purchases 50% of the capacity and energy from the power purchase agreement from Entergy Texas.

Total capacity expense under the power purchase agreement accounted for as an operating lease at Entergy Texas was $29.2 million in 2014, $28.6 million in 2013, and $19.2 million in 2012.

Sale and Leaseback Transactions

Waterford 3 Lease Obligations

In 1989, in three separate but substantially identical transactions, Entergy Louisiana sold and leased back undivided interests in Waterford 3 for the aggregate sum of $353.6 million. The leases expire in July 2017. At the end of the lease terms, Entergy Louisiana has the option to repurchase the leased interests in Waterford 3 at fair market value or to renew the leases for either fair market value or, under certain conditions, a fixed rate. In the event that Entergy Louisiana does not renew or purchase the interests, Entergy Louisiana would surrender such interests and their associated entitlement of Waterford 3’s capacity and energy.

Entergy Louisiana issued $208.2 million of non-interest bearing first mortgage bonds as collateral for the equity portion of certain amounts payable under the leases.

Upon the occurrence of certain events, Entergy Louisiana may be obligated to assume the outstanding bonds used to finance the purchase of the interests in the unit and to pay an amount sufficient to withdraw from the lease transaction. Such events include lease events of default, events of loss, deemed loss events, or certain adverse “Financial Events.” “Financial Events” include, among other things, failure by Entergy Louisiana, following the expiration of any applicable grace or cure period, to maintain (i) total equity capital (including preferred membership interests) at least equal to 30% of adjusted capitalization, or (ii) a fixed charge coverage ratio of at least 1.50 computed on a rolling 12 month basis. As of December 31, 2014, Entergy Louisiana was in compliance with these provisions.

As of December 31, 2014, Entergy Louisiana, in connection with the Waterford 3 sale and leaseback transactions, had future minimum lease payments (reflecting an overall implicit rate of 7.45%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$28,827
2016	16,938
2017	106,335
2018	—
2019	—
Years thereafter	—
Total	152,100
Less: Amount representing interest	23,612
Present value of net minimum lease payments		$128,488

Grand Gulf Lease Obligations

In 1988, in two separate but substantially identical transactions, System Energy sold and leased back undivided ownership interests in Grand Gulf for the aggregate sum of $500 million. The initial term of the leases was to expire in July 2015. In December 2013, System Energy exercised its options to renew the leases for fair market value with a renewal term for one lease expiring in July 2018 and the renewal term of the other lease expiring in July 2036. At the end of the new lease renewal terms, System Energy has the option to repurchase the leased interests in Grand Gulf or renew the leases at fair market value. In the event that System Energy does not renew or purchase the interests, System Energy would surrender such interests and their associated entitlement of Grand Gulf’s capacity and energy.

System Energy is required to report the sale-leaseback as a financing transaction in its financial statements. For financial reporting purposes, System Energy expenses the interest portion of the lease obligation and the plant depreciation. However, operating revenues include the recovery of the lease payments because the transactions are accounted for as a sale and leaseback for ratemaking purposes. Consistent with a recommendation contained in a FERC audit report, System Energy initially recorded as a net regulatory asset the difference between the recovery of the lease payments and the amounts expensed for interest and depreciation and continues to record this difference as a regulatory asset or liability on an ongoing basis, resulting in a zero net balance for the regulatory asset at the end of the lease term. The amount was a net regulatory liability of $62.9 million and $61.6 million as of December 31, 2014 and 2013, respectively.

As of December 31, 2014, System Energy, in connection with the Grand Gulf sale and leaseback transactions, had future minimum lease payments (reflecting an implicit rate of 5.13%) that are recorded as long-term debt, as follows:



	Amount
	(In Thousands)

2015		$52,253
2016	13,750
2017	13,750
2018	13,750
2019	13,750
Years thereafter	233,750
Total	341,003
Less: Amount representing interest	290,332
Present value of net minimum lease payments		$50,671