Balance Sheet Components

12 Months Ended

Dec. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Balance Sheet Components

Balance Sheet Components

Inventories

The components of inventory consist of the following (in thousands):

	December 31,
	2022		2021
Raw materials	$	165,446	$	80,809
Work-in-progress	44,660		31,893
Finished goods	58,288		30,668
	$	268,394	$	143,370

The inventory reserves were $17.2 million and $13.9 million as of December 31, 2022 and 2021, respectively.

Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets consist of the following (in thousands):

	December 31,
	2022		2021
Receivables from employees	$	6,553	$	5,463
Prepaid workers compensation	5,536		5,330
Prepaid Managed Services	4,405		2,480
Prepaid hardware and software maintenance	4,290		3,494
Tax receivables	3,676		1,518
Deposits made	1,409		817
Prepaid deferred commissions	1,002		724
Other prepaid expenses and other current assets	16,772		10,835
	$	43,643	$	30,661

Property, Plant and Equipment, Net

Property, plant and equipment, net, consists of the following (in thousands):

	December 31,
	2022		2021
Energy Servers	$	538,912	$	674,799
Machinery and equipment	145,555		110,600
Leasehold improvements	104,528		52,936
Construction-in-progress	72,174		43,544
Buildings	49,240		48,934
Computers, software and hardware	24,608		21,276
Furniture and fixtures	9,581		8,607
	944,598		960,696
Less: accumulated depreciation	(344,184)		(356,590)
	$	600,414	$	604,106

Depreciation expense related to property, plant and equipment was $61.6 million, $53.4 million and $52.2 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Property, plant and equipment under operating leases by the PPA Entities was $226.0 million and $368.0 million and accumulated depreciation for these assets was $92.7 million and $139.4 million as of December 31, 2022 and 2021, respectively. Depreciation expense for these assets was $12.1 million, $23.5 million and $23.8 million for the years ended December 31, 2022, 2021 and 2020, respectively.

PPA IIIa Upgrade

In June 2022, we started a project to replace 9.8 megawatts of second-generation Energy Servers (the “old Energy Servers”) at PPA IIIa Investment Company and Operating Company (“PPA IIIa”) with current generation Energy Servers (the “new Energy Servers”) (the “PPA IIIa Upgrade”, the “PPA IIIa Repowering”). The replacement was substantially complete as of December 31, 2022. See Note 11 - Portfolio Financings for additional information.

PPA IV Upgrade

In November 2022, we started a project to replace 19.3 megawatts of second-generation Energy Servers (the “old Energy Servers”) at PPA IV Investment Company and Operating Company (“PPA IV”) with current generation Energy Servers (the “new Energy Servers”) (the “PPA IV Upgrade”, the “PPA IV Repowering”). The replacement was ongoing as of December 31, 2022. See Note 11 - Portfolio Financings for additional information.

Change in Estimate

In June 2022 and November 2022, due to the replacement of old Energy Servers as part of the PPA IIIa and PPA IV Repowering, respectively, we revised the expected useful life of the old Energy Servers. As a result, the expected useful life of old Energy Servers decreased from 15 years to approximately 0.5 years. We recognized accelerated depreciation of $0.5 million in electricity cost of revenue on the revised carrying amount of the old Energy Servers after impairment loss in our consolidated statements of operations. There is no effect from this change in accounting estimate on future periods.

Other Long-Term Assets

Other long-term assets consist of the following (in thousands):

	December 31,
	2022		2021
Deferred commissions	$	8,320	$	7,569
Long-term lease receivable	8,076		7,953
Prepaid insurance	4,047		9,534
Deposits made	2,672		1,923
Prepaid Managed Services	2,373		3,010
Deferred tax asset	1,151		955
Investments in subsidiaries	—		1,819
Prepaid and other long-term assets	13,566		8,310
	$	40,205	$	41,073

Accrued Warranty

Accrued warranty liabilities consist of the following (in thousands):

	December 31,
	2022		2021
Product performance	$	16,901	$	10,785
Product warranty	431		961
	$	17,332	$	11,746

Changes in the product warranty and product performance liabilities were as follows (in thousands):

Balances at December 31, 2020	$	10,154
Accrued warranty, net	11,049
Warranty expenditures during the year	(9,457)
Balances at December 31, 2021	$	11,746
Accrued warranty, net	17,719
Warranty expenditures during the year	(12,133)
Balances at December 31, 2022	$	17,332

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following (in thousands):

	December 31,
	2022		2021
Compensation and benefits	$	48,156	$	38,222
General invoice and purchase order accruals	44,010		23,706
Delaware grant	9,495		—
Accrued installation	7,905		13,968
Sales-related liabilities	7,147		6,040
Sales tax liabilities	6,172		1,491
PPA IV Upgrade financing obligations	6,076		—
Accrued legal expenses	4,403		1,765
Interest payable	3,128		2,159
Current portion of derivative liabilities	2,596		6,059
Accrued consulting expenses	1,390		1,731
Provision for income tax	1,140		479
Finance lease liability	1,024		863
Option to acquire a variable number of shares of Class A Common Stock	—		13,200
Other	1,541		4,455
	$	144,183	$	114,138

Preferred Stock

As of December 31, 2022 and December 31, 2021, we had 20,000,000 shares and 10,000,000 shares of preferred stock authorized, respectively, of which 10,000,000 shares were designated as Series A redeemable convertible preferred stock. The preferred stock had $0.0001 par value. There were no shares of preferred stock issued or outstanding as of December 31, 2022 and, other than the Series A redeemable convertible preferred stock, as of December 31, 2021.