Leases

12 Months Ended

Dec. 31, 2022

Leases [Abstract]

Leases

LeasesNEE has operating and finance leases primarily related to land use agreements that convey exclusive use of the land during the arrangement for certain of its renewable energy projects and substations, buildings, equipment and, in 2021, purchased power agreements. Operating and finance leases primarily have fixed payments with expected expiration dates ranging from 2023 to 2083, with the exception of operating leases related to three land use agreements with an expiration date of 2106, some of which include options to extend the leases up to 20 years and some have options to terminate at NEE's discretion. At December 31, 2022, NEE’s ROU assets and lease liabilities for operating leases totaled approximately $386 million and $400 million, respectively; the respective amounts at December 31, 2021 were $547 million and $555 million. At December 31, 2022, NEE’s

ROU assets and lease liabilities for finance leases totaled approximately $378 million and $375 million, respectively; the respective amounts at December 31, 2021 were $205 million and $200 million. NEE’s lease liabilities at December 31, 2022 and 2021 were calculated using a weighted-average incremental borrowing rate at the lease inception of 3.66% and 3.57%, respectively, for operating leases and 3.98% and 3.52%, respectively, for finance leases, and a weighted-average remaining lease term of 45 years and 39 years, respectively, for operating leases and 33 years and 31 years, respectively, for finance leases. At December 31, 2022, expected lease payments over the remaining terms of the leases were approximately $1.6 billion with no one year being material. NEE's operating lease cost for the years ended December 31, 2022, 2021 and 2020 totaled approximately $70 million, $92 million and $95 million, respectively. Other operating and finance lease-related amounts were not material to NEE's consolidated statements of income or cash flows for the periods presented.

NEE has operating and sales-type leases primarily related to a natural gas and oil electric generation facility and certain battery storage facilities that sell their electric output under power sales agreements to third parties which provide the customers the ability to dispatch the facilities. At December 31, 2022 and 2021, NEE recorded a net investment in sales-type leases of approximately $53 million and $42 million, respectively. At December 31, 2022, the power sales agreements have expiration dates from 2024 to 2043 and NEE expects to receive approximately $1.1 billion of lease payments over the remaining terms of the power sales agreements with no one year being material. Operating and sales-type lease-related amounts were not material to NEE's consolidated statements of income for the periods presented.