Annual report [Section 13 and 15(d), not S-K Item 405]

Energy Assets, Net

v3.25.0.1
Energy Assets, Net
 12 Months Ended
Dec. 31, 2024
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Energy Assets, Net ENERGY ASSETS, NET
Energy assets, net consisted of the following: 
December 31,
  2024 2023
Energy assets (1)
$ 2,338,680  $ 2,054,145 
Less: accumulated depreciation, net (423,369) (364,721)
Energy assets, net $ 1,915,311  $ 1,689,424 
(1) Includes financing lease assets (see Note 8), capitalized interest and ARO assets (see tables below). Also includes the energy asset projects acquired in August 2023 and January 2024. See section below for additional information.
 
Energy Asset Acquisitions
In order to expand our portfolio of energy assets, we have acquired energy projects, which did not constitute businesses under the guidance discussed in Note 2.
August 2023 Purchase and Sale Agreement
On August 4, 2023, we entered into a purchase and sale agreement to acquire an energy asset project and rights to acquire 100% of the stock of Bright Canyon Energy Corporation (“BCE”) in a two-phased transaction exclusive of each other. Phase 1, the purchase of the energy asset project, closed on August 4, 2023 and did not constitute a business in accordance with ASC 805-50, Business Combinations.
The purchase price for phase 1 was $87,964, of which $5,000 was paid in cash, $46,694 was financed through a seller’s note, and we assumed a construction loan on the energy asset project for $36,270. We also acquired cash of $11,206. During the year ended December 31, 2023, we paid $18,400 in principal on the sellers note. In January 2024, the purchase price was increased by $1,147 and we paid off the seller’s note in the amount of $29,441. We also assumed a land lease for the energy asset project.
On December 28, 2023, we executed an amended and restated purchase and sale agreement, which primarily revised the timing of payments on phase 2. In the second phase, which closed on January 12, 2024, we acquired BCE, including its interest in a consolidated joint venture and its interests in project subsidiaries developing or with rights to develop solar, battery, and microgrid assets for an adjusted purchase price of $48,035, of which $9,839 was paid in cash and $32,500 was financed through a seller’s note. The remaining balance due of $5,696 was paid during the twelve months ended December 31, 2024. During the year ended December 31, 2024, we paid off the remaining balance of the seller’s note in the amount of $32,500. We also assumed four land leases for the energy asset projects. Phase 2, the purchase of the energy asset projects did not constitute a business in accordance with ASC 805-50, Business Combinations.
See Note 9 for additional information about the BCE-related loans, Note 8 for information on the leases and Note 15 for potential additional commitments.
November 2023 Purchase Agreement
On November 1, 2023, we purchased a solar asset project for $3,128, of which $2,676 has been paid to date. The remaining balance of $452 is included in accrued expenses and other current liabilities in the consolidated balance sheets at December 31, 2024. The payment is due when certain conditions as outlined in the agreement are met.
Transfer of Investment Tax Credits
Under phase 1 of the purchase and sale agreement with BCE noted above, we agreed to sell back to the seller ITC for the project acquired as part of this transaction for the fair market value of these credits and recorded $20,970 in other receivables which is included in prepaid expenses and other current assets in the consolidated balance sheets at December 31, 2023. This amount was collected in January 2024.
During the year ended December 31, 2024 we sold ITC on eight energy assets to a third party at a fair value of $47,534 which was received as of December 31, 2024. The benefit from the sale of the ITC will be recognized in profit or loss as a reduction to depreciation expense over the life of the energy assets.
Depreciation and Amortization
The following table sets forth our depreciation and amortization expense on energy assets, net of deferred grant amortization:
Year Ended December 31,
Location 2024 2023 2022
Cost of revenues (1)
$ 82,114  $ 59,390  $ 49,755 
(1) Includes depreciation and amortization expense on financing lease assets. See Note 8.
Capitalized Interest
The following table presents the interest costs relating to construction financing during the period of construction, which were capitalized as part of energy assets, net:
Year Ended December 31,
2024 2023 2022
Capitalized interest $ 50,889  $ 43,561  $ 13,050 
Long-lived Asset Impairment
During December 2024, there was a triggering event which caused us to perform an impairment analysis on an energy asset group. The triggering event was related to a landfill which ceased accepting waste material as of January 1, 2025, where we planned to build a RNG plant. As the landfill was no longer operational, we are no longer able to build the plant at the location. As a result, we recorded an impairment charge of $8,715 as of December 31, 2024, which fully impaired this asset group. Additionally, during December 2024, we recorded impairment charges of $3,669 for multiple energy asset projects which we no longer believe are viable and have been terminated, which partially impaired these asset groups.
During December 2023, there was a triggering event which caused us to perform an impairment analysis on an energy asset group. The triggering event was related to the requirement to shut down the plant and replace transmission lines due to transfer trip issues. We determined that the cost to overhaul the transfer trip line would be cost prohibitive, therefore, we made a decision to shut the plant down. As a result, we recorded an impairment charge of $1,298, which fully impaired this asset group. During December 2023, there was an additional energy asset group that had successive years of losses, the PPA expired in November 2024, and we expected losses to continue in 2024, therefore, we recorded an impairment charge of $311, which fully impaired this asset group.
The impairment charges are included in asset impairments within the consolidated statements of income for the years ended December 31, 2024 and 2023. There was no impairment charge for the year ended December 31, 2022.
Customer Energy Asset Projects
We include certain customer energy asset projects in our energy assets, as we control and operate the assets as well as obtain financing during the construction and operating periods of the assets. We also carry a liability associated with these energy assets as we have an obligation to the customer for performance of the asset. Provided that performance criteria are met, the customer is responsible for repayment of the liability to the financing party. As of December 31, 2024 and 2023, there were six energy asset projects which were included in energy assets.
The liabilities recognized in association with these customer energy assets were as follows:
December 31,
Location 2024 2023
Accrued expenses and other current liabilities $ 651  $ 598 
Other liabilities 47,692  41,680 
Total customer energy asset projects liability $ 48,343  $ 42,278 
ARO Assets and ARO Liabilities
Our ARO assets and ARO liabilities relate to the removal of equipment and pipelines at certain renewable gas projects and obligations related to the decommissioning of certain solar facilities.
The following tables sets forth information related to our ARO assets and ARO liabilities:
December 31,
Location 2024 2023
ARO assets, net Energy assets, net $ 4,414  $ 4,800 
ARO liabilities, non-current Other liabilities $ 6,136  $ 5,960 


Year Ended December 31,
2024 2023 2022
Depreciation expense of ARO assets $ 238  $ 215  $ 146 
Accretion expense of ARO liabilities $ 332  $ 258  $ 146