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Note 14. Revenue from Contracts with Customers (Notes)
 12 Months Ended
Dec. 31, 2020
Revenue from Contract with Customer [Abstract]  
Revenue from Contracts with Customers [Text Block]
14. Revenue from Contracts with Customers

The following table presents the disaggregation of revenue from contracts with customers for the years ended December 31, 2020, 2019, and 2018 along with the reportable segment for each category (in thousands):
CategorySegment202020192018
Solar modulesModules$1,736,060 $1,460,116 $502,001 
Solar power systemsSystems794,797 1,148,856 1,244,175 
O&M servicesSystems115,590 107,705 103,186 
Energy generation (1)Systems61,948 54,539 47,122 
EPC servicesSystems2,937 291,901 347,560 
Net sales$2,711,332 $3,063,117 $2,244,044 
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(1)During the year ended December 31, 2020, the majority of energy generated and sold by our PV solar power systems was accounted for under ASC 840 consistent with the classification of the associated PPAs.

We recognize revenue for module sales at a point in time following the transfer of control of the modules to the customer, which typically occurs upon shipment or delivery depending on the terms of the underlying contracts. Such contracts may contain provisions that require us to make liquidated damage payments to the customer if we fail to ship or deliver modules by scheduled dates. We recognize these liquidated damages as a reduction of revenue in the period we transfer control of the modules to the customer.

For EPC services, or sales of solar power systems with EPC services, we recognize revenue over time using cost based input methods, in which significant judgment is required to evaluate assumptions including the amount of net contract revenues and the total estimated costs to determine our progress toward contract completion. If the estimated total costs on any contract are greater than the net contract revenues, we recognize the entire estimated loss in the period the loss becomes known. The cumulative effect of revisions to estimates related to net contract revenues or costs to complete contracts are recorded in the period in which the revisions to estimates are identified and the amounts can be reasonably estimated.

Changes in estimates for sales of systems and EPC services occur for a variety of reasons, including but not limited to (i) construction plan accelerations or delays, (ii) module cost forecast changes, (iii) cost related change orders, or (iv) changes in other information used to estimate costs. Changes in estimates may have a material effect on our consolidated statements of operations.
The following table outlines the impact on revenue of net changes in estimated transaction prices and input costs for systems related sales contracts (both increases and decreases) for the years ended December 31, 2020, 2019, and 2018 as well as the number of projects that comprise such changes. For purposes of the table, we only include projects with changes in estimates that have a net impact on revenue of at least $1.0 million during the periods presented with the exception of the sales and use tax matter described below, for which the aggregate change in estimate has been presented. Also included in the table is the net change in estimate as a percentage of the aggregate revenue for such projects.
 202020192018
Number of projects (1)9 3 24 
(Decrease) increase in revenue from net changes in transaction prices (in thousands) (1)$(16,954)$(3,642)$63,361 
Increase (Decrease) in revenue from net changes in input cost estimates (in thousands)7,487 (23,103)1,548 
Net (decrease) increase in revenue from net changes in estimates (in thousands)$(9,467)$(26,745)$64,909 
Net change in estimate as a percentage of aggregate revenue(0.5)%(4.6)%0.6 %
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(1)During the year ended December 31, 2018, we settled a tax examination with the state of California regarding several matters, including certain sales and use tax payments due under lump sum EPC contracts. Accordingly, we revised our estimates of sales and use taxes due for projects in the state of California, which affected the estimated transaction prices for such contracts, and recorded an increase to revenue of $54.6 million.

The following table reflects the changes in our contract assets, which we classify as “Accounts receivable, unbilled” or “Retainage,” and our contract liabilities, which we classify as “Deferred revenue,” for the year ended December 31, 2020, excluding any assets or liabilities classified as held for sale as of December 31, 2020 (in thousands):
 20202019Change
Accounts receivable, unbilled (1)$49,395 $162,057 
Retainage— 21,416 
Allowance for credit losses(303)— 
Accounts receivable, unbilled and retainage, net$49,092 $183,473 $(134,381)(73)%
Deferred revenue (2)$233,732 $394,655 $(160,923)(41)%
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(1)Includes $22.7 million of noncurrent accounts receivable, unbilled classified as “Other assets” on our consolidated balance sheet as of December 31, 2020.

(2)Includes $44.9 million and $71.4 million of noncurrent deferred revenue classified as “Other liabilities” on our consolidated balance sheets as of December 31, 2020 and 2019, respectively.

During the year ended December 31, 2020, our contract assets decreased by $134.4 million primarily due to billings associated with ongoing construction activities at the GA Solar 4, Sun Streams, and Sunshine Valley projects, partially offset by unbilled receivables associated with the sale of certain systems projects. During the year ended December 31, 2020, our contract liabilities decreased by $160.9 million primarily due to the recognition of revenue for sales of solar modules for which payment was received in 2019 prior to the step down in the U.S. investment tax credit from 30% to 26%, partially offset by advance payments received for sales of solar modules in the current period. During the years ended December 31, 2020 and 2019, we recognized revenue of $316.1 million and $117.7 million, respectively, that was included in the corresponding contract liability balance at the beginning of the periods.
As of December 31, 2020, we had entered into contracts with customers for the future sale of 10.7 GWDC of solar modules for an aggregate transaction price of $3.3 billion. We expect to recognize such amounts as revenue through 2023 as we transfer control of the modules to the customers. While our contracts with customers typically represent firm purchase commitments, these contracts may be subject to amendments made by us or requested by our customers. These amendments may increase or decrease the volume of modules to be sold under the contract, change delivery schedules, or otherwise adjust the expected revenue under these contracts. As of December 31, 2020, we had entered into O&M contracts covering approximately 900 MWDC of utility-scale PV solar power systems, excluding contracts expected to be transferred to Clairvest in connection with the sale of our North American O&M operations. See Note 7. “Consolidated Balance Sheet Details” to our consolidated financial statements for further information. We expect to recognize $146.0 million of revenue during the noncancelable term of these O&M contracts over a weighted-average period of 18.3 years.