XML 13 R36.htm IDEA: XBRL DOCUMENT

Leases (Tables)

9 Months Ended

Sep. 30, 2019

The following table summarizes SCE's lease payments for operating and finance leases as of September 30, 2019.



(in millions)	PPA Operating Leases^1,2		Other Operating Leases³		PPA Finance Leases¹
2019	$	20	$	11	$	—
2020	70		35		1
2021	48		28		1
2022	48		23		2
2023	47		17		2
Thereafter	536		104		9
Total lease payments	$	769	$	218	$	15
Amount representing interest⁴	226		60		6
Lease liabilities	$	543	$	158	$	9

Summary of Operating Lease Payments

The following table summarizes SCE's lease payments for operating and finance leases as of September 30, 2019.



(in millions)	PPA Operating Leases^1,2		Other Operating Leases³		PPA Finance Leases¹
2019	$	20	$	11	$	—
2020	70		35		1
2021	48		28		1
2022	48		23		2
2023	47		17		2
Thereafter	536		104		9
Total lease payments	$	769	$	218	$	15
Amount representing interest⁴	226		60		6
Lease liabilities	$	543	$	158	$	9

Summary of Capital Lease Payments

At December 31, 2018, SCE's future expected minimum lease commitments under non-cancellable leases were as follows:



(in millions)	PPA Operating Leases¹		Other Operating Leases³		PPA Capital Leases¹
2019	$	148	$	42	$	5
2020	124		31		6
2021	103		27		6
2022	79		22		6
2023	47		17		5
Thereafter	536		101		66
Total lease payments	$	1,037	$	240	$	94
Amount representing executory costs					25
Amount representing interest					33
Net commitments					$	36


¹	Excludes expected purchases from most renewable energy contracts, which do not meet the definition of a lease payment since renewable power generation is contingent on external factors.


²	During the second quarter of 2019, SCE amended three power contracts that resulted in a $161 million reduction in ROU assets and lease liabilities as these contracts no longer qualify as leases.


³	Excludes escalation clauses based on consumer price or other indices and residual value guarantees that are not considered probable at the commencement date of the lease.

⁴

Lease payments are discounted to their present value using SCE's incremental borrowing rates.

Summary of Operating Lease Payments

At December 31, 2018, SCE's future expected minimum lease commitments under non-cancellable leases were as follows:



(in millions)	PPA Operating Leases¹		Other Operating Leases³		PPA Capital Leases¹
2019	$	148	$	42	$	5
2020	124		31		6
2021	103		27		6
2022	79		22		6
2023	47		17		5
Thereafter	536		101		66
Total lease payments	$	1,037	$	240	$	94
Amount representing executory costs					25
Amount representing interest					33
Net commitments					$	36


¹	Excludes expected purchases from most renewable energy contracts, which do not meet the definition of a lease payment since renewable power generation is contingent on external factors.


²	During the second quarter of 2019, SCE amended three power contracts that resulted in a $161 million reduction in ROU assets and lease liabilities as these contracts no longer qualify as leases.


³	Excludes escalation clauses based on consumer price or other indices and residual value guarantees that are not considered probable at the commencement date of the lease.

⁴

Lease payments are discounted to their present value using SCE's incremental borrowing rates.

Supplemental Balance Sheet Information

Supplemental balance sheet information related to SCE's leases was as follows:



(in millions)	September 30, 2019
Operating leases:
Operating lease ROU assets	$	701
Current portion of operating lease liabilities	90
Operating lease liabilities	611
Total operating lease liabilities	$	701

Finance leases included in:
Utility property, plant and equipment, gross	$	14
Accumulated depreciation	(5		)
Utility property, plant and equipment, net	9
Other current liabilities	—
Other long-term liabilities	9
Total finance lease liabilities	$	9

Summary of Lease Expense Components

Other information related to leases was as follows:



(in millions, except lease term and discount rate)	Nine months ended September 30, 2019
Cash paid for amounts included in the measurement of lease liabilities:
Operating cash flows from operating leases
PPA leases	$	98
Other leases	34

ROU assets obtained in exchange for lease obligations:
Other operating leases	23

Weighted average remaining lease term (in years):
Operating leases
PPA leases	16.03
Other leases	12.75
PPA Finance leases	11.71

Weighted average discount rate:
Operating leases
PPA leases	4.44		%
Other leases	3.89		%
PPA Finance leases	8.74		%

The timing of SCE's recognition of the lease expense conforms to ratemaking treatment for SCE's recovery of the cost of electricity and is included in purchased power for operating leases and interest and amortization expense for finance leases. The following table summarizes the components of SCE's lease expense:



(in millions)	Three months ended September 30, 2019		Nine months ended September 30, 2019
PPA leases:
Operating lease cost	$	38	$	98
Finance lease cost	1		1
Variable lease cost	751		1,742
Total PPA lease cost	790		1,841
Other operating leases cost	12		35
Total lease cost	$	802	$	1,876

Schedule of Undiscounted Cash Flow Expected from Lease Payments

At September 30, 2019, the undiscounted cash flow expected to be received from lease payments for the remaining years is as follows:



(in millions)
2019	$	4
2020	14
2021	10
2022	10
2023	9
Thereafter	155
Total	$	202