Genie Energy Ltd

Previous wording

Genie Renewables holds our 95.5% interest in Genie Solar, an integrated solar energy company, our 92.8% interest in CityCom Solar, a marketer of community solar and other sales solutions and our 96.0% interest in Diversegy, an energy broker.

Current wording

Genie Renewables holds our 95.5% interest in Genie Solar, an integrated solar energy company, our 92.8% interest in CityCom Solar, a marketer of community solar and alternative products and services complimentary to our energy offerings, and our 96.0% interest in Diversegy, our energy procurement advisor.

Previous wording

Net loss from discontinued operations of Lumo Finland and Lumo Sweden, net of taxes was $0.1 million and $0.6 million for the three months ended June 30, 2024 and 2023, respectively. Net loss from discontinued operations of Lumo Finland and Lumo Sweden, net of taxes was $0.4 million and $0.8 million for the six months ended June 30, 2024 and 2023, respectively.

Current wording

Net loss from discontinued operations of Lumo Finland and Lumo Sweden, net of taxes was minimal and $0.3 million for the three months ended September 30, 2024 and 2023, respectively. Net loss from discontinued operations of Lumo Finland and Lumo Sweden, net of taxes was $0.4 million and $0.5 million for the nine months ended September 30, 2024 and 2023, respectively.

Previous wording

On November 8, 2023, the Lumo Administrators, acting on behalf of the Bankruptcy Estate, filed a claim in the District Court of Helsinki against Genie Nordic, its directors, officers and affiliates, in which it alleges that the gain from the sale of swap instruments owned by Lumo Sweden amounting to €35.2 million (equivalent to $37.8 million as of June 30, 2024) belongs to the Bankruptcy Estate. The Bankruptcy Estate filed an additional claim with the District Court on May 27, 2024 against Lumo Sweden for €4.8 million (equivalent to $5.2 million as of June 30, 2024), also alleging that the gain from the sale of the swap instruments belongs to the Bankruptcy Estate, bringing the aggregate sum of claims related to the gain from sale of swap instruments to €40.0 million (equivalent to $43.0 million as of June 30, 2024). The Company believes that the Lumo Administrators' position is without merit, and it intends to vigorously defend its position.

Current wording

On November 8, 2023, the Lumo Administrators, acting on behalf of the Bankruptcy Estate, filed a claim in the District Court of Helsinki against Genie Nordic, its directors, officers and affiliates, in which it alleges that the gain from the sale of swap instruments owned by Lumo Sweden amounting to €35.2 million (equivalent to $39.2 million as of September 30, 2024) belongs to the Bankruptcy Estate. The Bankruptcy Estate filed an additional claim with the District Court on May 27, 2024 against Lumo Sweden for €4.8 million (equivalent to $5.3 million as of September 30, 2024), also alleging that the gain from the sale of the swap instruments belongs to the Bankruptcy Estate, bringing the aggregate sum of claims related to the gain from sale of swap instruments to €40.0 million (equivalent to $44.5 million as of September 30, 2024). The Company believes that the Lumo Administrators' position is without merit, and it intends to vigorously defend its position.

Previous wording

We are also notified that the Lumo Administrators filed a claim againstone of Lumo Finland’s suppliers, seeking to recover payments made by Lumo Finland amounting to €4.2 million (equivalent to $4.5 million as of June 30, 2024) prior to the bankruptcy. Related to such payment, the Lumo Administrators have filed a recovery claim jointly against us and the supplier for €1.6 million (equivalent to $1.7 million as of June 30, 2024) alleging that a portion of the payment by Lumo Finland effectively reduced our liability under the terms of a previously supplied parental guarantee(this €1.6 is included within and not additive to the €4.2 million). The Lumo Administrators allege that the payments represented preferential payments and therefore belong to the bankruptcy estate which are recoverable under the laws of Finland. We intend to challenge the Lumo Administrators' claims. Nevertheless, should the Lumo Administrators succeed in clawing back the funds from the supplier, it is possible that the supplier will seek to recover its losses against us, under terms of the parental guarantee. At this time there is insufficient basis to assess an amount of any probable loss.

Current wording

We have also been notified that the Lumo Administrators filed a claim againstone of Lumo Finland’s suppliers, seeking to recover payments made by Lumo Finland amounting to €4.2 million (equivalent to $4.7 million as of September 30, 2024) prior to the bankruptcy. Related to such payment, the Lumo Administrators have filed a recovery claim jointly against us and the supplier for €1.6 million (equivalent to $1.8 million as of September 30, 2024) alleging that a portion of the payment by Lumo Finland effectively reduced our liability under the terms of a previously supplied parental guarantee(this €1.6 is included within and not additive to the €4.2 million). The Lumo Administrators allege that the payments represented preferential payments and therefore belong to the bankruptcy estate which are recoverable under the laws of Finland. We intend to challenge the Lumo Administrators' claims. Nevertheless, should the Lumo Administrators succeed in clawing back the funds from the supplier, it is possible that the supplier will seek to recover its losses against us, under terms of the parental guarantee. At this time there is insufficient basis to assess an amount of any probable loss.

Previous wording

There wereno income or loss from discontinued operations recognized in thethree and six months ended June 30, 2024. In thethree and six months ended June 30, 2023, the Company recognized income from discontinued operation, net of taxes of $2.6. and $5.4 million, respectively, mainly from the increase in the estimated value of our investments in Orbit due to a change in estimated net assets of Orbit after the Orbit Administrators settle the liabilities.

Current wording

There wereno income or loss from discontinued operations recognized in thethree and nine months ended September 30, 2024 and in thethree months ended September 30, 2023. In thenine months ended September 30, 2023, the Company recognized income from discontinued operation, net of taxes of $5.4 million, mainly from the increase in the estimated value of our investments in Orbit due to a change in estimated net assets of Orbit after the Orbit Administrators settle the liabilities.

Previous wording

GRE operates REPs that resell electricity and/or natural gas to residential and small business customers in Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Texas, Rhode Island, and Washington, D.C. GRE’s revenues represented approximately 95.6% and 94.7% of our consolidated revenues in thethree and six months ended June 30, 2024, respectivelyand 96.0% and 96.2% of our consolidated revenues in thethree and six months ended June 30, 2023, respectively.

Current wording

GRE operates REPs that resell electricity and/or natural gas to residential and small business customers in Connecticut, Delaware, Florida, Georgia, Illinois, Indiana, Maine, Maryland, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Texas, Rhode Island, and Washington, D.C. GRE’s revenues represented approximately 94.5% and 94.6% of our consolidated revenues in thethree and nine months ended September 30, 2024, respectivelyand 96.2% and 96.2% of our consolidated revenues in thethree and nine months ended September 30, 2023, respectively.

Previous wording

The weather and the seasons, among other things, affect GRE’s REPs' revenues. Weather conditions have a significant impact on the demand for natural gas used for heating and electricity used for heating and cooling. Typically, colder winters increase demand for natural gas and electricity, and hotter summers increase demand for electricity. Milder winters and/or summers have the opposite effects. Unseasonable temperatures in other periods may also impact demand levels. Potential changes in global climate may produce, among other possible conditions, unusual variations in temperature and weather patterns, resulting in unusual weather conditions, more intense, frequent and extreme weather events and other natural disasters. Some climatologists believe that these extreme weather events will become more common and more extreme, which will have a greater impact on our operations. Natural gas revenues typically increase in the first quarter due to increased heating demands and electricity revenues typically increase in the third quarter due to increased air conditioning use. Approximately 48.1% and 39.7% of GRE’s natural gas revenues for the relevant years were generated in the first quarter of 2023 and 2022 respectively, when demand for heating was highest. Although the demand for electricity is not as seasonal as natural gas (due, in part, to usage of electricity for both heating and cooling), approximately 32.5% and 30.5% of GRE’s electricity revenues for 2023 and 2022 respectively, were generated in the third quarters of those years. GRE's REP's revenues and operating income are subject to material seasonal variations, and the interim financial results are not necessarily indicative of the estimated financial results for the full year.

Current wording

The weather and the seasons, among other things, affect GRE’s REPs' revenues. Weather conditions have a significant impact on the demand for natural gas used for heating and electricity used for heating and cooling. Typically, colder winters increase demand for natural gas and electricity, and hotter summers increase demand for electricity. Milder winters and/or summers have the opposite effects. Unseasonable temperatures in other periods may also impact demand levels. Potential changes in global climate may produce, among other possible conditions, unusual variations in temperature and weather patterns, resulting in unusual weather conditions, more intense, frequent and extreme weather events and other natural disasters. Some climatologists believe that these extreme weather events will become more common and more extreme, which will have a greater impact on our operations. Natural gas revenues typically increase in the first quarter due to increased heating demands and electricity revenues typically increase in the third quarter due to increased air conditioning use. Approximately 48.1% and 39.7% of GRE’s natural gas revenues for the relevant years were generated in the first quarter of 2023 and 2022 respectively, when demand for heating was highest. Although the demand for electricity is not as seasonal as natural gas (due, in part, to usage of electricity for both heating and cooling), approximately 32.5% and 30.5% of GRE’s electricity revenues for 2023 and 2022 respectively, were generated in the third quarters of those years. GRE's REP's revenues and operating income are subject to material seasonal variations, and the interim financial results are not necessarily indicative of the estimated financial results for the full year. In addition, extraordinary weather has and can lead to extreme spikes in the prices of wholesale electricity and natural gas in markets where GRE and other retail providers purchase their supply, or in challenges to the grid or supply markets in affected areas. Such events could have material impacts on our margins and operations.

Previous wording

Utility companies offer purchase of receivable, or POR, programs in most of the service territories in which GRE operates. GRE’s REPs reduce their customer credit risk by participating in POR programs for a majority of their receivables. In addition to providing billing and collection services, utility companies purchase those REPs’ receivables and assume all credit risk without recourse to those REPs. GRE’s REPs’ primary credit risk is therefore nonpayment by the utility companies. In thethree and six months ended June 30, 2024 the associated cost was approximately 1.0% of GRE revenueand approximately 0.9% for thethree months ended June 30, 2023, respectively. At June 30, 2024, 83.8% of GRE’s net accounts receivable were under a POR program. Certain of the utility companies represent significant portions of our consolidated revenues and consolidated gross trade accounts receivable balance during certain periods, and such concentrations increase our risk associated with nonpayment by those utility companies.

Current wording

Utility companies offer purchase of receivable, or POR, programs in most of the service territories in which GRE operates. GRE’s REPs reduce their customer credit risk by participating in POR programs for a majority of their receivables. In addition to providing billing and collection services, utility companies purchase those REPs’ receivables and assume all credit risk without recourse to those REPs. GRE’s REPs’ primary credit risk is therefore nonpayment by the utility companies. In thethree and nine months ended September 30, 2024 the associated cost was approximately 1.3% of GRE's revenueand approximately 3.5% of GRE's revenue for thethree and nine months ended September 30, 2023. At September 30, 2024 and December 31, 2023,80.2% and 84.4% , respectively, of GRE’s net accounts receivable were under POR programs. Certain of the utility companies represent significant portions of our consolidated revenues and consolidated gross trade accounts receivable balance during certain periods, and such concentrations increase our risk associated with nonpayment by those utility companies.

Previous wording

Our consolidated financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP. Our significant accounting policies are described in Note 1 to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as the disclosure of contingent assets and liabilities. Critical accounting policies are those that require the application of management’s most subjective or complex judgments, often as a result of matters that are inherently uncertain and may change in subsequent periods. Our critical accounting policies include those related to revenue recognition, allowance for doubtful accounts, acquisitions, goodwill, and income taxes. Management bases its estimates and judgments on historical experience and other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. For additional discussion of our critical accounting policies, see our Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.

Current wording

Our consolidated financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America, or U.S. GAAP. Our significant accounting policies are described in Note 1 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2023. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses as well as the disclosure of contingent assets and liabilities. Critical accounting policies are those that require the application of management’s most subjective or complex judgments, often as a result of matters that are inherently uncertain and may change in subsequent periods. Our critical accounting policies include those related to revenue recognition, allowance for doubtful accounts, acquisitions, goodwill, and income taxes. Management bases its estimates and judgments on historical experience and other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. For additional discussion of our critical accounting policies, see our Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2023.

Previous wording

We evaluate the performance of our operating business segments based primarily on income (loss) from operations. Accordingly, the income and expense line items below income (loss) from operations are only included in our discussion of the consolidated results of operations.

Current wording

We evaluate the performance of our operating business segments based primarily on income (loss) from operations. Accordingly, the income and expense line items below income (loss) from operations are only included in our discussion of our consolidated results of operations.

Previous wording

Three and Six Months Ended June 30, 2024 Compared to Three and Six Months Ended June 30, 2023

Current wording

Three and Nine Months Ended September 30, 2024 Compared to Three and Nine Months Ended September 30, 2023

Previous wording

Revenues. Electricity revenues decreased by 2.4% in the three months ended June 30, 2024 compared to the same period in 2023. The decrease was due to a decline in the average price per kilowatt hour charged to customers in the three months ended June 30, 2024 compared to the same period in 2023. Electricity consumption by GRE’s REPs' customers slightly decreased by 0.1% in thethree months ended June 30, 2024, compared to the same period in 2023, reflectinga 3.8% decrease in the average number of meters served, substantially offset by a 3.9% increasein average consumption per meter. The decrease in meters served was due to reduced level of the customer acquisitions in thethree months ended June 30, 2024 compared to the same period in 2023. The increase in per meter consumption in thethree months ended June 30, 2024 compared to the same period in 2023 was due to standard fluctuations in customer consumption patterns. The average rate per kilowatt hour sold decreased 2.3% in the three months ended June 30, 2024 compared to the same period in 2023 due to general market conditions.

Current wording

Revenues. Electricity revenues decreased by 11.7% in the three months ended September 30, 2024 compared to the same period in 2023. The decrease was due to a decrease in electricity consumption slightly offset by an increase in the average price per kilowatt hour charged to customers in the three months ended September 30, 2024 compared to the same period in 2023. Electricity consumption by GRE’s REPs' customers decreased by 12.6% in thethree months ended September 30, 2024, compared to the same period in 2023, reflecting 2.3% and 10.5% decreases in the average number of meters served and average consumption per meter, respectively. The decrease in meters served was due to an increase in the churn rates of customers related to the growth in meters served during the first half of 2024, as new customers tend to have higher rates of churn than long-standing customers. The decrease in per meter consumption in thethree months ended September 30, 2024 compared to the same period in 2023 was due to cooler than usual weather during the 2024 summer cooling season and standard fluctuations in customer consumption patterns. The average rate per kilowatt hour sold slightly increased by 1.0% in the three months ended September 30, 2024 compared to the same period in 2023 due to general market conditions.

Previous wording

Electricity revenues increased by 8.4% in thesix months ended June 30, 2024 compared to the same period in 2023. The increase was due to an increase in electricity consumption partially offset by a decrease in the average price per kilowatt hour charged to customers in thesix months ended June 30, 2024 compared to the same period in 2023. Electricity consumption by GRE’s REPs' customers increased by 15.1% in thesix months ended June 30, 2024, compared to the same period in 2023 reflecting a 6.0% increase in the average number of meters served and an 8.5% increase in average consumption per meter. The increase in meters served was driven by strong customer acquisition during 2023. Electricity consumption per meter increased in thesix months ended June 30, 2024 compared to the same period in 2023 due to standard fluctuations in customer consumption patterns. The average rate per kilowatt hour sold decreased by 5.8% in thesix months ended June 30, 2024 compared to the same period in 2023 due to general market conditions.

Current wording

Electricity revenues slightly decreased by 0.1% in thenine months ended September 30, 2024 compared to the same period in 2023. The decrease was due to a decrease inin the average price per kilowatt hour charged to customers partially offset by an increase in electricity consumption in thenine months ended September 30, 2024 compared to the same period in 2023. The average rate per kilowatt hour sold decreased by 2.6% in thenine months ended September 30, 2024 compared to the same period in 2023 due to general market conditions. Electricity consumption by GRE’s REPs' customers increased by 2.6% in thenine months ended September 30, 2024, compared to the same period in 2023 reflecting a 3.6% increase in the average number of meters served partially offset by a 0.4% decrease in average consumption per meter. The increase in meters served was driven by strong customer acquisitions during the third quarter of 2024. Electricity consumption per meter decreased in thenine months ended September 30, 2024 compared to the same period in 2023 due to cooler than usual weather during the 2024 summer cooling season and standard fluctuations in customer consumption patterns.

Previous wording

GRE’s natural gas revenues decreased by 6.3% in the three months ended June 30, 2024 compared to the same period in 2023. The decrease was a result of a decrease in average revenue per therm sold partially offset by an increase innatural gas consumption per meter in thethree months ended June 30, 2024 compared to the same period in 2023. Natural gas consumption by GRE’s REPs’ customers increased by 5.9% in the three months ended June 30, 2024 compared to the same period in 2023, reflecting a 6.6% increase in average meters served, partially offset by a 0.7% decrease in average consumption per meter. The increase in meters served was due to higher levels of customer acquisitions in thethree months ended June 30, 2024 compared to the same period in 2023. The average revenue per therm sold decreased by 11.5% in the three months ended June 30, 2024, compared to the same period in 2023 due to general market conditions.

Current wording

Natural gas revenues increased by 1.3% in the three months ended September 30, 2024 compared to the same period in 2023. The increase was a result of an increasein natural gas consumption partially offset by a decreasein average revenue per therm soldin thethree months ended September 30, 2024 compared to the same period in 2023. Natural gas consumption by GRE’s REPs’ customers increased by 4.3% in the three months ended September 30, 2024 compared to the same period in 2023, reflecting a 6.9% increase in average meters served, partially offset by a 2.4% decrease in average consumption per meter. The increase in meters served was due to high levels of customer acquisitions in thethree months ended September 30, 2024. The average revenue per therm sold decreased by 2.9% in the three months ended September 30, 2024, compared to the same period in 2023 due to general market conditions.

Previous wording

GRE’s natural gas revenues decreased by 14.2% in thesix months ended June 30, 2024 compared to the same period in 2023. The decrease in natural gas revenues in thesix months ended June 30, 2024 compared to the same period in 2023 was a result of a decrease in average revenue per therm sold partially offset by an increase in natural gas consumption. Natural gas consumption by GRE’s REPs’ customers increased by 7.1% in thesix months ended June 30, 2024 compared to the same period in 2023, reflecting increases inaverage meters served and average consumption per meter of 6.3% and 0.7%, respectively, in thesix months ended June 30, 2024 compared to the same period in 2023. The increase in meters served was driven by strong customer acquisition efforts during 2023 and continued through 2024. The increase in meters served was due to higher levels of customer acquisitions in thesix months ended June 30, 2024 compared to the same period in 2023. The average revenue pertherm sold decreased by 11.5% in thesix months ended June 30, 2024, compared to the same period in 2023 due general market conditions.

Current wording

Natural gas revenues decreased by 12.3% in thenine months ended September 30, 2024 compared to the same period in 2023. The decrease in natural gas revenues in thenine months ended September 30, 2024 compared to the same period in 2023 was a result of a decrease in average revenue per therm sold partially offset by an increase in natural gas consumption. Average revenue pertherm sold decreased by 17.8% in the nine months ended September 30, 2024, compared to the same period in 2023 due to general market conditions. Natural gas consumption by GRE’s REPs’ customers increased by 6.7% in thenine months ended September 30, 2024 compared to the same period in 2023, reflecting increases inaverage meters served and average consumption per meter of 6.5% and 0.1%, respectively, in thenine months ended September 30, 2024 compared to the same period in 2023. The increase in meters served was driven by customer acquisition efforts during 2023 and continued through 2024.

Previous wording

Other revenues in thethree and six months ended June 30, 2024 and 2023 included revenues from the sale of petroleum products in Israel.

Current wording

Other revenues in thethree and nine months ended September 30, 2024 and 2023 included revenues from the sale of petroleum products in Israel and customer termination fees from commercial customers.

Previous wording

Gross meter acquisitions in thethree months ended June 30, 2024, were 53,000 compared to 75,000 for the same period in 2023. Gross meter acquisitions in thesix months ended June 30, 2024, were 123,000 compared to 204,000 for the same period in 2023. In the first quarter of 2023, we resumed customer acquisition activities using a variety of new and existing channels after a "strategic pause" implemented from the fourth quarter of 2021 through 2022. The gross meter acquisitions for the three and six months ended June 30, 2024 decreased compared to the same periods in 2023 as customer acquisition efforts returned to a normal level.

Current wording

Gross meter acquisitions in thethree months ended September 30, 2024, were 104,000 compared to 60,000 for the same period in 2023. Gross meter acquisitions in thenine months ended September 30, 2024, were 234,000 compared to 264,000 for the same period in 2023. In the first quarter of 2023, we resumed customer acquisition activities using a variety of new and existing channels after a "strategic pause" implemented from the fourth quarter of 2021 through 2022. The gross meter acquisition for thethree months ended September 30, 2024 increased compared to the same period in 2023 due to a significant customer aggregation deal that started in September 2024. The gross meter acquisitions for thenine months ended September 30, 2024 decreased compared to the same periods in 2023 as customer acquisition efforts returned to historically normalized level.

Previous wording

Meters served decreased by 2,000 between March 31, 2024 to June 30, 2024. Meters served increased by 1,000 meters from December 31, 2023 to June 30, 2024. The slight fluctuations in the number of meters served at June 30, 2024 compared to March 31, 2024 and December 31, 2023.

Current wording

Meters served increased by 37,000 between June 30, 2024 to September 30, 2024. Meters served increased by 35,000 meters from December 31, 2023 to September 30, 2024. The increase in the number of meters served at September 30, 2024 compared to June 30, 2024 and December 31, 2023. was due to a significant aggregation deal that started in September 2024.

Previous wording

In thethree months ended June 30, 2024, average monthly churn increased to 4.6% compared to 4.3% for same period in 2023. In thesix months ended June 30, 2024, the average monthly churn increased to 5.1% compared to 4.3% for same period in 2023, as a result of higher churn rate related to newly acquired customers.

Current wording

In thethree months ended September 30, 2024, average monthly churn increased to 5.6% compared to 4.4% for same period in 2023. In thenine months ended September 30, 2024, the average monthly churn increased to 5.4% compared to 4.4% for same period in 2023, as a result of higher churn rates related to newly acquired customers.

Previous wording

RCEs at June 30, 2024 decreased 0.9% compared to March 31, 2024. The decrease is due to customer acquisition efforts returning to normal level in 2024 as discussed above.

Current wording

RCEs at September 30, 2024 increased 10.1% compared to June 30, 2024. The increase is due to a customer aggregation deal that started in September 2024 as discussed above.

Previous wording

Cost of revenues for electricity increased in thethree months ended June 30, 2024 compared to the same period in 2023 primarily because of an increase inthe average unit cost of electricity partially offset by slight decrease in electricity consumption by GRE’s REPs’ customers. The average unit cost of electricity increased 7.6% in thethree months ended June 30, 2024 compared to the same period in 2023 due to an increase in the average wholesale price of electricity. The gross margin on electricity sales decreased in thethree months ended June 30, 2024 compared to the same period in 2023 because the average unit cost of electricity increased while theaverage rate charged to customers decreased. The decrease in gross margin is due to the change in the mix type of customers in the three months ended June 30, 2024 compared to the same periods in 2023.

Current wording

Cost of revenues for electricity decreased in thethree months ended September 30, 2024 compared to the same period in 2023 primarily because of a decrease inthe electricity consumption by GRE’s REPs’ customers partially offset by an increase in theaverage unit cost of electricity. The average unit cost of electricity increased 2.0% in thethree months ended September 30, 2024 compared to the same period in 2023 due to an increase in the average wholesale price of electricity. The gross margin on electricity sales decreased in thethree months ended September 30, 2024 compared to the same period in 2023 because the average unit cost of electricity increased more than theaverage rate charged to customers. The decrease in gross margin is due to the change in the mix type of customers in thethree months ended September 30, 2024 compared to the same periods in 2023.

Previous wording

Cost of revenues for electricity increased in thesix months ended June 30, 2024 compared to the same period in 2023 primarily because of increases in electricity consumption by GRE’s REPs’ customers and the average unit cost of electricity. The average unit cost of electricity increased 9.2% in thesix months ended June 30, 2024 compared to the same period in 2023. The significant increase is due to a rise in the wholesale price of electricity during thesix months ended June 30, 2024 compared to the same period in 2023. Gross margin on electricity sales decreased in thesix months ended June 30, 2024 compared to the same period in 2023 because the average unit cost of electricity increased while the average rate charged to customers decreased. The decrease in gross margin is due to the change in the mix type of customers in the six months ended June 30, 2024 compared to the same periods in 2023.

Current wording

Cost of revenues for electricity increased in thenine months ended September 30, 2024 compared to the same period in 2023 primarily because of increases in electricity consumption by GRE’s REPs’ customers and the average unit cost of electricity. The average unit cost of electricity increased 6.4% in thenine months ended September 30, 2024 compared to the same period in 2023, due to higher wholesale prices of electricity during thenine months ended September 30, 2024 compared to the same period in 2023. Gross margin on electricity sales decreased in thenine months ended September 30, 2024 compared to the same period in 2023 because the average unit cost of electricity increased while the average rate charged to customers decreased.

Previous wording

Cost of revenues for natural gas decreased in the three months ended June 30, 2024 compared to the same period in 2023 primarily because of a decrease in the average unit cost of natural gas partially offset by an increase in thenatural gas consumption by GRE's REPs' customers. The average unit cost of natural gas decreased by 16.1% per therm in thethree months ended June 30, 2024 compared to the same period in 2023 due to a decrease in the wholesale price of natural gas. Gross margin on natural gas sales increased in the three months ended June 30, 2024 compared to the same period in 2023 because the average rate charged to customers decreased while the average unit cost of natural gas increased.

Current wording

Cost of revenues for natural gas decreased in the three months ended September 30, 2024 compared to the same period in 2023 primarily because of a decrease in the average unit cost of natural gas partially offset by an increase in thenatural gas consumption by GRE's REPs' customers. The average unit cost of natural gas decreased by 13.7% per therm in thethree months ended September 30, 2024 compared to the same period in 2023 due to a decrease in the wholesale price of natural gas. Gross margin on natural gas sales increased in the three months ended September 30, 2024 compared to the same period in 2023 because theaverage unit cost of natural gas increased more than the increase in theaverage rate charged to customers.

Previous wording

Cost of revenues for natural gasincreased in thesix months ended June 30, 2024 compared to the same period in 2023 primarily because of an increase in the average unit cost of natural gas partially offset by a decrease in natural gas consumption by GRE's REPs' customers. The average unit cost of natural gas decreased 38.0% in thesix months ended June 30, 2024 compared to the same period in 2023. The significant decrease is due to a decrease in the wholesale price of electricity during thesix months ended June 30, 2024 compared to the same period in 2023, particularly in the first quarter of 2023. Gross margin on natural gas sales decreased in thesix months ended June 30, 2024 compared to the same period in 2023 because the average rate charged to customers increased less than the increase in the average unit cost of natural gas.

Current wording

Cost of revenues for natural gasdecreased in thenine months ended September 30, 2024 compared to the same period in 2023 primarily because of a decrease in the average unit cost of natural gas partially offset by an increase in natural gas consumption by GRE's REPs' customers. The average unit cost of natural gas decreased 35.5% in thenine months ended September 30, 2024 compared to the same period in 2023 due to a decrease in the wholesale price of natural gas during thenine months ended September 30, 2024 compared to the same period in 2023. Gross margin on natural gas sales increased in thenine months ended September 30, 2024 compared to the same period in 2023 because theaverage unit cost of natural gas decreased more than the decrease in theaverage rate charged to customers.

Previous wording

Selling, General and Administrative. Selling, general and administrative expenses decreased by 7.4% in thethree months ended June 30, 2024 compared to the same period in 2023 primarily due to decreases in marketing and customer acquisition costs, employee-related costs and provision for doubtful accounts partially offset by increases in POR program fees and processing fees. Marketing and customer acquisition expenses decreased by $1.5 million in thethree months ended June 30, 2024 compared to the same period in 2023 as a result of a decrease in the number of meters acquired during 2024 period. Employee-related expenses decreased by $0.1 million in thethree months ended June 30, 2024 compared to the same period in 2023 primarily due to a decrease in bonus accrual. Provision for doubtful accounts decreased by $0.3 million in the three months ended June 30, 2024 compared to the same period in 2023 as a result of continued increase in collection efforts. POR program fees increased by$0.2 million in thethree months ended June 30, 2024 compared to the same period in 2023 as a result of changes in rates implemented by several utilities. Processing fees increased by $0.3 million in thethree months ended June 30, 2024 compared to the same period in 2023 as a result of an increase in meters with billing fees incurred by GRE. As a percentage of GRE’s total revenues, selling, general and administrative expense increased from 21.2% in thethree months ended June 30, 2023 to 20.4% in thethree months ended June 30, 2024.

Current wording

Selling, General and Administrative. Selling, general and administrative expenses increased by 10.1% in thethree months ended September 30, 2024 compared to the same period in 2023 primarily due to increases in marketing and customer acquisition costs, management fees, POR program fees and processing fees partially offset by a decrease in employee-related expenses. Marketing and customer acquisition expenses increased by $0.9 million in thethree months ended September 30, 2024 compared to the same period in 2023 as a result of an increase in the number of meters acquired during the 2024 period. Management fees increased by $0.5 million in thethree months ended September 30, 2024 compared to the same period in 2023 as a result of a favorable results in Mirabito. POR program fees increased by$0.1 million in thethree months ended September 30, 2024 compared to the same period in 2023 as a result of changes in rates implemented by several utilities. Processing fees increased by $0.5 million in thethree months ended September 30, 2024 compared to the same period in 2023 as a result of an increase in meters served with billing fees incurred by GRE. Employee-related expenses decreased by $0.5 million in thethree months ended September 30, 2024 compared to the same period in 2023 primarily due to a decrease in bonus accrual. As a percentage of GRE’s total revenues, selling, general and administrative expense increased from 15.7% in thethree months ended September 30, 2023 to 19.6% in thethree months ended September 30, 2024.

Previous wording

Selling, general and administrative expenses increased by 1.3% in thesix months ended June 30, 2024 compared to the same period in 2023. The increase in selling, general and administrative expense in thesix months ended June 30, 2024 compared to the same period in 2023 was primarily due to increases POR program fees, processing fees, and employee-related costs partially offset by decreases in marketing and customer acquisition cost and provision for doubtful accounts. POR processing fees increased by $0.5 million in thesix months ended June 30, 2024 compared to the same period in 2023 as a result of changes in rates implemented by several utilities. Processing fees increased by $0.6 million in the six months ended June 30, 2024 compared to the same period in 2023 as a result of an increase in meters with billing fees. Employee-related expenses increased by $0.2 million in thesix months ended June 30, 2024 compared to the same period in 2023 primarily due to an increase in commissions paid to employees. Marketing and customer acquisition expenses decreased by $0.8 million in thesix months ended June 30, 2024 compared to the same period in 2023 as a result of a decrease in the number of meters acquired. Provision for doubtful accounts decreased by $0.2 million in thesix months ended June 30, 2024 compared to the same period in 2023 as a result of a continued increase in collection efforts. As a percentage of GRE’s total revenues, selling, general and administrative expense decreased from 18.4%% in thesix months ended June 30, 2023 to 17.9%% in thesix months ended June 30, 2024.

Current wording

Selling, general and administrative expenses increased by 4.4% in thenine months ended September 30, 2024 compared to the same period in 2023. The increase in selling, general and administrative expense in thenine months ended September 30, 2024 compared to the same period in 2023 was primarily due to increases in processing fees, POR program fees, management fees, and marketing and customer acquisition costs. Processing fees increased by $0.9 million in the nine months ended September 30, 2024 compared to the same period in 2023 as a result of an increase in meters served with billing fees. POR processing fees increased by $0.6 million in thenine months ended September 30, 2024 compared to the same period in 2023 as a result of changes in rates implemented by several utilities. Management fees increased by $0.6 million in thenine months ended September 30, 2024 compared to the same period in 2023 as a result of a favorable results in Mirabito. Marketing and customer acquisition expenses slightly increased by $0.1 million in thenine months ended September 30, 2024 compared to the same period in 2023. As a percentage of GRE’s total revenues, selling, general and administrative expense increased from 17.3% in thenine months ended September 30, 2023 to 18.5% in thenine months ended September 30, 2024.

Previous wording

The Genie Renewables (formerly GES) segment is composed of Genie Solar, CityCom Solar and Diversegy. Genie Solar is an integrated solar energy company that develops, constructs and operates solar energy projects for commercial and industrial customers as well as its own portfolio. CityCom Solar is a marketer of alternative products and services complementary to our energy offerings. Diversegy provides energy brokerage and advisory services to commercial and industrial customers.

Current wording

The Genie Renewables (formerly GES) segment is composed of Genie Solar, CityCom Solar and Diversegy. Genie Solar is an integrated solar energy company that develops, constructs and operates solar energy projects. CityCom Solar is a marketer of community solar and alternative products and services complementary to our energy offerings. Diversegy provides energy procurement advisory services to commercial and industrial customers.

Previous wording

On November 3, 2023, Genie Solar acquiredten special-purpose entities that own and operate solar system facilities in Ohio and Michigan for an aggregate purchase price of $7.5 million. The acquisition has been accounted for as an asset acquisition with a total purchase price of $7.7 million, including $0.2 million of direct transaction cost allocated to solar arrays assets included in the property and equipment account in our consolidated balance sheet.

Current wording

The acquisitions have been accounted for as an asset acquisition with a total purchase price of $9.0 million, including $0.2 million of direct transaction cost allocated to solar arrays assets included in the property and equipment account in our consolidated balance sheets.

Previous wording

*Revenue.*Genie Renewables' revenues increased in thethree and six months ended June 30, 2024 compared to the same periods in 2023. The increase in revenues were the result of increases from Diversegy that includes commissions, entry fees and other fees from our energy brokerage and marketing services businesses and revenue contributions from the portfolio of operating solar projects at Genie Solar, partially offset by decreasesin revenues from the development of solar projects for customers from Genie Solar, revenues from commissions from selling third-party products to customers by CityCom Solar and sale of solar panels by Prism.

Current wording

*Revenue.*Genie Renewables' revenues increased in thethree and nine months ended September 30, 2024 compared to the same periods in 2023. The increase in revenues were the result of increases from Diversegy that includes commissions, entry fees and other fees revenue contributions from the portfolio of operating solar projects at Genie Solar and revenues from the development of solar projects for customers from Genie Solar partially offset by a decrease in revenues from commissions from selling alternative products and services to customers by CityCom Solar.

Previous wording

Cost of Revenues. The variations in the cost of revenues for thethree and six months ended June 30, 2024 compared to the same periods in 2023 are due to changes in the mix of products from which the revenues were generated during the periods. In the first quarter of 2024, we recorded a $0.4 million charge to the cost of revenues of Genie Solar to write down the carrying value of solar panel inventories to the estimated net realizable value.

Current wording

Cost of Revenues. The variations in the cost of revenues for thethree and nine months ended September 30, 2024 compared to the same periods in 2023 are due to changes in the mix of products from which the revenues were generated during the periods. In the first quarter of 2024, we recorded a $0.4 million charge to the cost of revenues of Genie Solar to write down the carrying value of solar panel inventories to the estimated net realizable value.

Previous wording

Selling, General and Administrative. Selling, general and administrative expenses increased in thethree and six months ended June 30, 2024 compared to the same periods in 2023 primarily due to increases in headcount in Genie Solar and Diversegy, consulting fees, warehousing costs at Genie Solar and depreciation from the solar arrays acquired by Genie Solar in the lastsix months.

Current wording

Selling, General and Administrative. Selling, general and administrative expenses increased in thethree and nine months ended September 30, 2024 compared to the same periods in 2023 primarily due to increases in headcount in Genie Solar and Diversegy, consulting fees, warehousing costs at Genie Solar and depreciation from the solar arrays acquired by Genie Solar in the last nine months.

Previous wording

Impairment of assets. The impairment of assets recorded in the three andsix months ended June 30, 2024 relates to capitalized cost at Genie Solar related to solar projects that were discontinued in the second quarter of 2024.

Current wording

Impairment of assets. The impairment of assets recorded in the three andnine months ended September 30, 2024 relates to capitalized cost at Genie Solar for solar projects that were discontinued in the second quarter of 2024.

Previous wording

As discussed above, the remaining accounts of GRE International were transferred to corporate starting in the third quarter of 2022. Entities under corporate do not generate any revenues, nor does it incur any cost of revenues. Corporate costs include unallocated compensation, consulting fees, legal fees, business development expense and other corporate-related general and administrative expenses.

Current wording

As discussed above, the remaining accounts of GRE International were transferred to corporate starting in the third quarter of 2022. (when GRE International ceased being treated as a separate segment). Entities under corporate do not generate any revenues, nor does it incur any cost of revenues. Corporate costs include unallocated compensation, consulting fees, legal fees, business development expense and other corporate-related general and administrative expenses.

Previous wording

Corporate general and administrative expenses decreased in thethree months ended June 30, 2024 compared to the same period in 2023 and increased in thesix months ended June 30, 2024 compared to the same period in 2023 primarily because of decreases in employee-related cost and professional and consulting fees. As a percentage of our consolidated revenues, Corporate general and administrative decreased to 2.2% in thethree months ended June 30, 2024 from 2.3% in thethree months ended June 30, 2023 and decreased to 2.3% in thesix months ended June 30, 2024 from 3.1% in thesix months ended June 30, 2023.

Current wording

Corporate general and administrative expenses slightly increased in thethree months ended September 30, 2024 compared to the same period in 2023. Corporate general and administrative expenses decreased in thenine months ended September 30, 2024 compared to the same period in 2023 primarily because of decreases in employee-related cost and professional and consulting fees. As a percentage of our consolidated revenues, Corporate general and administrative increased to 1.9% in thethree months ended September 30, 2024 from 1.6% in thethree months ended September 30, 2023 and decreased to 2.1% in thenine months ended September 30, 2024 from 2.5% in thenine months ended September 30, 2023.

Previous wording

In December 2023, we established a wholly-owned captive insurance subsidiary (the "Captive") with the primary purpose of enhancing our risk financing strategies. In December 2023, we paid $51.2 million premiums to Captive, which amount is included in restricted cash in our consolidated balance sheet as of December 31, 2023. The Captive must maintain a sufficient level of cash to fund future reserve payment and secure the insurer's liabilities, particularly those related to the insured risks. We also recognized $0.6 and $ $1.7 million provision for captive insurance liability for the three andsix months ended June 30, 2024 related to Captive's exposure for the insured risks.

Current wording

In December 2023, we established a wholly-owned captive insurance subsidiary (the "Captive") with the primary purpose of enhancing our risk financing strategies. In December 2023, we paid $51.2 million premiums to Captive, which amount is included in restricted cash in our consolidated balance sheet as of December 31, 2023. The Captive must maintain a sufficient level of cash to fund future reserve payment and secure the insurer's liabilities, particularly those related to the insured risks. We also recognized $1.0 and $ $2.7 million provision for captive insurance liability for the three andnine months ended September 30, 2024 related to Captive's exposure for the insured risks.

Previous wording

Selling, general and administrative expenses. Stock-based compensation expense included in consolidated selling, general and administrative expenses was $0.5 million and $0.8 million in thethree months ended June 30, 2024 and 2023 respectively, and$1.2 million and$1.6 million for thesix months ended June 30, 2024 and 2023. At June 30, 2024, the aggregate unrecognized compensation cost related to non-vested stock-based compensation was $0.4 million. The unrecognized compensation cost is recognized over the expected service period.

Current wording

Selling, general and administrative expenses. Stock-based compensation expense included in consolidated selling, general and administrative expenses was $0.6 million for each of thethree months ended September 30, 2024 and 2023 respectively, and$1.8 million and$2.3 million for thenine months ended September 30, 2024 and 2023. At September 30, 2024, the aggregate unrecognized compensation cost related to non-vested stock-based compensation was $6.5 million. The unrecognized compensation cost is recognized over the expected vesting period.

Previous wording

Interest income. Interest income increased in thethree and six months ended June 30, 2024, compared to the same period in 2023 primarily due to increase in average balances of cash and cash equivalents and restricted cash during the period.

Current wording

Interest income. Interest income increased in thethree and nine months ended September 30, 2024, compared to the same periods in 2023 primarily due to increase in average balances of cash and cash equivalents and restricted cash during the period.

Previous wording

Other Income, net. Other income, netin the three months ended June 30, 2024 and 2023 and in thesix months ended June 30, 2024 and 2023 consisted primarily offoreign currency transactions and equity in net loss in equity method investees. Other income (loss) income, net, in thethree months ended June 30, 2023 consisted primarily of a one-time tax credit related to payroll taxes incurred in prior years.

Current wording

Other Income, net. Other income, netin the three months ended September 30, 2024 and 2023 and in thenine months ended September 30, 2024 and 2023 consisted primarily offoreign currency transactions and equity in net loss in equity method investees. Other income (loss) income, net, in thethree months ended September 30, 2023 consisted primarily of a one-time tax credit related to payroll taxes incurred in prior years.

Previous wording

Provision for Income Taxes. The change in the reported tax rate for thethree and six months ended June 30, 2024 compared to the same periods in 2023 is the result of changes in the mix of jurisdictions in which taxable income was earned.

Current wording

Provision for Income Taxes. The change in the reported tax rate for thethree and nine months ended September 30, 2024 compared to the same periods in 2023 is the result of changes in the mix of jurisdictions in which taxable income was earned.

Previous wording

Net Loss Attributable to Noncontrolling Interests. The decreases in net loss attributable to noncontrolling interests in thethree and six months ended June 30, 2024 compared to the same periods in 2023 was primarily due to the share of noncontrolling interest in the operations of Citizens Choice Energy.

Current wording

Net Loss Attributable to Noncontrolling Interests. The decreases in net loss attributable to noncontrolling interests in thethree and nine months ended September 30, 2024 compared to the same periods in 2023 was primarily due to the share of noncontrolling interest in the operations of Citizens Choice Energy.