5. Restricted Cash and Investments

Restricted cash and investments consisted of the following at March 31, 2015 and December 31, 2014 (in thousands):



	March 31, 2015		December 31, 2014
Restricted cash	$	51,144	$	49,818
Restricted investments	370,731		357,235
Restricted cash and investments (1)	$	421,875	$	407,053


(1)	There was an additional $75.4 million and $74.7 million of restricted cash included within prepaid expenses and other current assets at March 31, 2015 and December 31, 2014, respectively.

At March 31, 2015, our restricted cash consisted of deposits held by various banks to secure certain of our letters of credit and deposits designated for the construction of systems projects and payment of amounts related to project construction credit facilities. Restricted cash for our letters of credit is classified as current or noncurrent based on the maturity date of the corresponding letter of credit. See Note 12. “Commitments and Contingencies” to our condensed consolidated financial statements for further discussion relating to letters of credit. Restricted cash for project construction and financing is classified as current or noncurrent based on the projected use of the restricted funds.

At March 31, 2015 and December 31, 2014, our restricted investments consisted of long-term marketable securities that we hold through custodial accounts to fund the estimated future costs of collecting and recycling modules covered under our solar module collection and recycling program. We classify our restricted investments as available-for-sale. Accordingly, we record them at fair value and account for the net unrealized gains and losses as a part of “Accumulated other comprehensive income” until realized. We record realized gains and losses on the sale or maturity of our restricted investments in “Other expense, net” computed using the specific identification method. Restricted investments are classified as noncurrent as the underlying accrued solar module collection and recycling liability is also noncurrent in nature.

As necessary, we fund any incremental amounts for our estimated collection and recycling obligations within 90 days of the end of each year. We determine the funding requirement, if any, based on estimated costs of collecting and recycling covered modules, estimated rates of return on our restricted investments, and an estimated solar module life of 25 years less amounts already funded in prior years. To ensure that these funds will be available in the future regardless of any potential adverse changes in our financial condition (even in the case of our own insolvency), we have established a trust (the “Trust”) under which estimated funds are put into custodial accounts with an established and reputable bank, for which First Solar, Inc. (“FSI”), First Solar Malaysia Sdn. Bhd. (“FS Malaysia”), and First Solar Manufacturing GmbH are grantors. Only the trustee can distribute funds from the custodial accounts, and these funds cannot be accessed for any purpose other than to cover qualified costs of module collection and recycling, either by us or a third party performing the required collection and recycling services. Investments in these custodial accounts must meet certain investment quality criteria comparable to highly rated government or agency bonds. We closely monitor our exposure to European markets and maintain holdings primarily consisting of German and French sovereign debt securities that are not currently at risk of default. During the three months ended March 31, 2015, no incremental funding was required for covered module sales through December 31, 2014.

The following tables summarize unrealized gains and losses related to our restricted investments by major security type as of March 31, 2015 and December 31, 2014 (in thousands):



	As of March 31, 2015
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	170,352	$	124,001	$	—	$	294,353
U.S. government obligations	59,156		17,222		—		76,378
Total	$	229,508	$	141,223	$	—	$	370,731



	As of December 31, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Estimated Fair Value
Foreign government obligations	$	189,455	$	93,280	$	—	$	282,735
U.S. government obligations	58,510		15,990		—		74,500
Total	$	247,965	$	109,270	$	—	$	357,235

As of March 31, 2015 and December 31, 2014, the contractual maturities of these restricted investments were between 13 years and 22 years.