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Leases (Tables)

3 Months Ended

Mar. 31, 2019

Lease Assets and Liabilities Recorded in Consolidated Balance Sheets

At March 31, 2019, the Companies had the following lease assets and liabilities recorded in the Consolidated Balance Sheets:

	March 31, 2019
(millions)
Dominion Energy
Lease assets:
Operating lease assets	$	486
Finance lease assets⁽¹⁾		79
Total lease assets	$	565
Lease liabilities:
Operating lease liabilities⁽²⁾	$	62
Finance lease liabilities⁽³⁾		14
Total lease liabilities - current		76
Operating lease liabilities		418
Finance lease liabilities⁽⁴⁾		66
Total lease liabilities - noncurrent		484
Total lease liabilities	$	560
Virginia Power
Operating lease assets	$	202
Finance lease assets⁽¹⁾		8
Total lease assets	$	210
Lease liabilities:
Operating lease liabilities⁽²⁾	$	33
Finance lease liabilities⁽³⁾		2
Total lease liabilities - current		35
Operating lease liabilities		169
Finance lease liabilities⁽⁴⁾		5
Total lease liabilities - noncurrent		174
Total lease liabilities	$	209
Dominion Energy Gas
Operating lease assets	$	63
Finance lease assets⁽¹⁾		3
Total lease assets	$	66
Lease liabilities:
Operating lease liabilities⁽²⁾	$	12
Finance lease liabilities⁽³⁾		1
Total lease liabilities - current		13
Operating lease liabilities		49
Finance lease liabilities⁽⁴⁾		3
Total lease liabilities - noncurrent		52
Total lease liabilities	$	65

(1)	Included in property, plant and equipment in the Companies’ Consolidated Balance Sheets, net of $29 million, $2 million and $1 million of accumulated amortization at Dominion Energy, Virginia Power and Dominion Energy Gas, respectively, at March 31, 2019.

(2)	Included in other current liabilities in the Companies’ Consolidated Balance Sheets.

(3)	Included in securities due within one year in the Companies’ Consolidated Balance Sheets.

(4)	Included in long-term debt in the Companies’ Consolidated Balance Sheets.

Summary of Total Lease Cost

For the three months ended March 31, 2019, total lease cost associated with the Companies’ lessee leasing arrangements consisted of the following:

	Three Months Ended March 31, 2019
(millions)
Dominion Energy
Finance lease cost:
Amortization	$	3
Interest		1
Operating lease cost		25
Short-term lease cost		6
Variable lease cost		2
Total lease cost	$	37
Virginia Power
Operating lease cost	$	10
Short-term lease cost		2
Variable lease cost		1
Total lease cost	$	13
Dominion Energy Gas
Operating lease cost	$	4
Short-term lease cost		1
Total lease cost	$	5

Cash Paid for Amounts Included in Measurement of Lease Liabilities

For the three months ended March 31, 2019, cash paid for amounts included in the measurement of lease liabilities consisted of the following amounts, included in the Companies’ Consolidated Statements of Cash Flows:

	Three Months Ended March 31, 2019
(millions)
Dominion Energy
Operating cash flows for finance leases	$	1
Operating cash flows for operating leases		32
Financing cash flows for finance leases		3
Virginia Power
Operating cash flows for operating leases		13
Dominion Energy Gas
Operating cash flows for operating leases		5

Weighted Average Remaining Lease Term and Weighted Discounted Rate for Finance and Operating Leases

At March 31, 2019, the weighted average remaining lease term and weighted discount rate for the Companies’ finance and operating leases were as follows:

	March 31, 2019
Dominion Energy
Weighted average remaining lease term - finance leases	7 years
Weighted average remaining lease term - operating leases	21 years
Weighted average discount rate - finance leases		4.66	%
Weighted average discount rate - operating leases		4.61	%
Virginia Power
Weighted average remaining lease term - finance leases	6 years
Weighted average remaining lease term - operating leases	16 years
Weighted average discount rate - finance leases		4.99	%
Weighted average discount rate - operating leases		4.47	%
Dominion Energy Gas
Weighted average remaining lease term - finance leases	6 years
Weighted average remaining lease term - operating leases	9 years
Weighted average discount rate - finance leases		5.04	%
Weighted average discount rate - operating leases		4.44	%

Scheduled Maturities of Lease Liabilities

The Companies’ lease liabilities have the following scheduled maturities:

Maturity of Lease Liabilities	Dominion Energy						Virginia Power						Dominion Energy Gas
(millions)	Operating			Finance			Operating			Finance			Operating			Finance
2019	$	54		$	14		$	30		$	2		$	11		$	1
2020		66			16			36			1			13			1
2021		58			14			31			1			11			1
2022		49			12			24			1			9			1
2023		39			9			19			1			6			-
After 2023		532			33			162			2			24			1
Total undiscounted lease payments		798			98			302			8			74			5
Present value adjustment		(318	)		(18	)		(100	)		(1	)		(13	)		(1	)
Present value of lease liabilities	$	480		$	80		$	202		$	7		$	61		$	4