v3.26.1
Leases
 6 Months Ended
Jun. 30, 2026
Leases [Abstract]  
Leases LEASES
Lease Expense
Operating Leases
NW Holdings and NW Natural have operating leases for land, buildings and equipment. The primary lease is for NW Natural's headquarters and operations center. Leases have remaining lease terms of 2 months to 14 years. Many of the lease agreements include options to extend the lease, which are not included in minimum lease terms unless they are reasonably certain to be exercised. Short-term leases with a term of 12 months or less are not recorded on the balance sheet. As most of the leases do not provide an implicit rate and are entered into by NW Natural, an estimated discount rate is used. The estimated discount rate represents the rate that would have been incurred to finance the funds necessary to purchase the leased asset and is based on information available at the lease commencement date in determining the present value of lease payments.
The components of lease expense, a portion of which is capitalized, were as follows:
In thousandsThree Months Ended June 30,Six Months Ended June 30,
2026202520262025
NW Holdings:
Operating lease expense$2,291 $2,218 $4,543 $4,329 
Short-term lease expense 405 160 623 349 
NW Natural:
Operating lease expense$1,941 $1,971 $3,895 $3,838 
Short-term lease expense 315 160 435 349 

The Company’s lease arrangements are described in Note 7 to the consolidated financial statements included in the Company’s Annual Report on Form 10‑K, which should be read in conjunction with this Form 10‑Q. There have been no material changes to the Company’s lease portfolio during the current quarter.

The weighted-average remaining lease terms and weighted-average discount rates for the operating leases were as follows:
In thousandsJune 30,December 31,
202620252025
NW Natural:
Weighted-average remaining lease term (years)13.814.814.3
Weighted-average discount rate7.3 %7.3 %7.3 %

Supplemental Cash Flow
Supplemental cash flow information related to leases was as follows:
In thousandsSix Months Ended June 30,
20262025
NW Holdings:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$4,304 $4,241 
Right of use assets obtained in exchange for lease obligations
Operating leases$1,711 $2,647 
NW Natural:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$3,880 $3,753 
Right of use assets obtained in exchange for lease obligations
Operating leases$250 $346 
Lessor, Operating Leases LEASES
Lease Expense
Operating Leases
NW Holdings and NW Natural have operating leases for land, buildings and equipment. The primary lease is for NW Natural's headquarters and operations center. Leases have remaining lease terms of 2 months to 14 years. Many of the lease agreements include options to extend the lease, which are not included in minimum lease terms unless they are reasonably certain to be exercised. Short-term leases with a term of 12 months or less are not recorded on the balance sheet. As most of the leases do not provide an implicit rate and are entered into by NW Natural, an estimated discount rate is used. The estimated discount rate represents the rate that would have been incurred to finance the funds necessary to purchase the leased asset and is based on information available at the lease commencement date in determining the present value of lease payments.
The components of lease expense, a portion of which is capitalized, were as follows:
In thousandsThree Months Ended June 30,Six Months Ended June 30,
2026202520262025
NW Holdings:
Operating lease expense$2,291 $2,218 $4,543 $4,329 
Short-term lease expense 405 160 623 349 
NW Natural:
Operating lease expense$1,941 $1,971 $3,895 $3,838 
Short-term lease expense 315 160 435 349 

The Company’s lease arrangements are described in Note 7 to the consolidated financial statements included in the Company’s Annual Report on Form 10‑K, which should be read in conjunction with this Form 10‑Q. There have been no material changes to the Company’s lease portfolio during the current quarter.

The weighted-average remaining lease terms and weighted-average discount rates for the operating leases were as follows:
In thousandsJune 30,December 31,
202620252025
NW Natural:
Weighted-average remaining lease term (years)13.814.814.3
Weighted-average discount rate7.3 %7.3 %7.3 %

Supplemental Cash Flow
Supplemental cash flow information related to leases was as follows:
In thousandsSix Months Ended June 30,
20262025
NW Holdings:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$4,304 $4,241 
Right of use assets obtained in exchange for lease obligations
Operating leases$1,711 $2,647 
NW Natural:
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$3,880 $3,753 
Right of use assets obtained in exchange for lease obligations
Operating leases$250 $346