LEASES

3 Months Ended

Mar. 31, 2025

In February 2025, WECI closed on its acquisition of a 90% ownership interest in Hardin III, a solar generating facility. Related to its investment in Hardin III, WECI acquired several land leases that commenced in the first quarter of 2025. See Note 2, Acquisitions, for more information on this project.

The land leases acquired related to Hardin III have terms consisting of 1) an initial term of 25 years with an option for an additional 25-year extension and 2) an initial term of 35 years with an option for a 10-year extension. We expect the optional extensions to be exercised, and, as a result, these land leases are being amortized over the extended terms of the leases. Our total obligation under these land-related operating leases was $32.8 million at March 31, 2025, and was included in other long-term liabilities on our balance sheet. Our operating lease right of use assets were $32.4 million as of March 31, 2025, and were included in other long-term assets on our balance sheet. Our weighted-average discount rate for these land-related operating leases was 6.30%. We used an estimate of the fully collateralized incremental borrowing rates based upon information available for similarly rated companies in determining the present value of lease payments.

Future minimum lease payments and the corresponding present value of our net minimum lease payments under these land-related operating leases as of March 31, 2025, were as follows:


(in millions)
Nine Months Ended December 31, 2025	$	1.6
2026	1.6
2027	1.7
2028	1.7
2029	1.7
2030	1.8
Thereafter	120.5
Total minimum lease payments	130.6
Less: Interest	(97.8)
Present value of minimum lease payments	32.8
Less: Short-term lease liabilities	—
Long-term lease liabilities	$	32.8