ORMAT TECHNOLOGIES INC

Previous wording

•Electricity Segment. In the Electricity segment, we develop, build, own and operate geothermal, solar PV and recovered energy-based power plants in the United States and geothermal power plants in other countries around the world and sell the electricity they generate. In the three months ended June 30, 2024, we derived 72.0% of our Electricity segment revenues from our operations in the United States and 28.0% from the rest of the world.

Current wording

•Electricity Segment. In the Electricity segment, we develop, build, own and operate geothermal, solar PV and recovered energy-based power plants in the United States and geothermal power plants in other countries around the world and sell the electricity they generate. In the three months ended September 30, 2024, we derived 71.0% of our Electricity segment revenues from our operations in the United States and 29.0% from the rest of the world.

Previous wording

•Product Segment. In the Product segment, we design, manufacture and sell equipment for geothermal and recovered energy-based electricity generation and provide services relating to the engineering, procurement and construction of geothermal and recovered energy-based power plants. In the three months ended June 30, 2024, we derived 4.3% of our Product segment revenues from our operations in the United States and 95.7% from the rest of the world.

Current wording

•Product Segment. In the Product segment, we design, manufacture and sell equipment for geothermal and recovered energy-based electricity generation and provide services relating to the engineering, procurement and construction of geothermal and recovered energy-based power plants. In the three months ended September 30, 2024, we derived 8.6% of our Product segment revenues from our operations in the United States and 91.4% from the rest of the world.

Previous wording

For the six months ended June 30, 2024, 92.5% of our Electricity segment revenues were from PPAs with fixed energy rates, which are not affected by fluctuations in energy commodity prices. We have a variable price PPA in Hawaii, which provides for payments based on the local utilities’ avoided cost, which is the incremental cost that the power purchaser avoids by not having to generate such electrical energy itself or purchase it from others. In Hawaii, the prices paid for electricity pursuant to the 25 MW PPA for the Puna Complex in Hawai`i change primarily as a result of variations in the price of oil as well as other commodities. In 2019, we signed a new PPA related to Puna with fixed prices, increased capacity and extended the term until 2052. In February 2024 the HPUC approved two final amendments to the PPA that we expect will be in effect by the end of 2026.

Current wording

For the nine months ended September 30, 2024, 91.9% of our Electricity segment revenues were from PPAs with fixed energy rates, which are not affected by fluctuations in energy commodity prices. We have a variable price PPA in Hawaii, which provides for payments based on the local utilities’ avoided cost, which is the incremental cost that the power purchaser avoids by not having to generate such electrical energy itself or purchase it from others. In Hawaii, the prices paid for electricity pursuant to the 25 MW PPA for the Puna Complex in Hawai`i change primarily as a result of variations in the price of oil as well as other commodities. In 2019, we signed a new PPA related to Puna with fixed prices, increased capacity and extended the term until 2052. In February 2024, the HPUC approved two final amendments to the PPA that we expect will be in effect by the end of 2026.

Previous wording

In the six months ended June 30, 2024 and 2023, 35% and 36% of our total revenues, respectively, were derived from foreign locations. In the three months ended June 30, 2024 and 2023, 39% and 41% of our total revenues, respectively, were derived from foreign locations. Our foreign operations had higher Electricity gross margins than our U.S. operations in each of those periods. A substantial portion of Electricity foreign revenues came from Kenya and to a lesser extent, from Honduras, Guadeloupe and Guatemala. Our operations in Kenya contributed disproportionately to gross profit and net income. The contribution to combined pre-tax income of our domestic and foreign operations within our Electricity segment and Product segment differ in a number of ways, as summarized below.

Current wording

In the nine months ended September 30, 2024 and 2023, 36% and 38% of our total revenues, respectively, were derived from foreign locations. In the three months ended September 30, 2024 and 2023, 39% and 41% of our total revenues, respectively, were derived from foreign locations. Our foreign operations had higher Electricity gross margins than our U.S. operations in each of those periods. A substantial portion of Electricity segment foreign revenues came from Kenya and to a lesser extent, from Honduras, Guadeloupe and Guatemala. Our operations in Kenya contributed disproportionately to gross profit and net income. The contribution to combined pre-tax income of our domestic and foreign operations within our Electricity segment and Product segment differ in a number of ways, as summarized below.

Previous wording

Electricity Segment. Our Electricity segment domestic revenues were approximately 74% and 70% of our total Electricity segment revenues for the six months ended June 30, 2024 and 2023, respectively, and 72% and 68% of our total Electricity segment revenues for the three months ended June 30, 2024 and 2023. Our Electricity segment foreign revenues were approximately 26% and 30% of our total Electricity segment revenues for the six months ended June 30, 2024 and 2023, respectively, and 28% and 32% of our total Electricity segment revenues for the three months ended June 30, 2024 and 2023.However, domestic operations have higher costs of revenues and expenses than our foreign operations. Our foreign power plants are located in lower-cost regions, like Kenya, Guatemala, Honduras and Guadeloupe, which favorably impact payroll, maintenance expenses and other items. Our power plants in foreign locations are also newer than most of our domestic power plants and therefore tend to have lower maintenance costs and higher availability factors than our domestic power plants. Consequently, in the six months ended June 30, 2024 and 2023, our foreign operations of the segment accounted for 37% and 48% of our total gross profits, 74% and 73% of our net income (assuming the majority of corporate operating expenses and financing are recorded under our domestic jurisdiction) and 31% and 39% of our EBITDA, respectively.

Current wording

Electricity Segment. Our Electricity segment domestic revenues were approximately 73% and 70% of our total Electricity segment revenues for the nine months ended September 30, 2024 and 2023, respectively, and 71% and 69% of our total Electricity segment revenues for the three months ended September 30, 2024 and 2023. Our Electricity segment foreign revenues were approximately 27% and 30% of our total Electricity segment revenues for the nine months ended September 30, 2024 and 2023, respectively, and 29% and 31% of our total Electricity segment revenues for the three months ended September 30, 2024 and 2023. However, domestic operations have higher costs of revenues and expenses than our foreign operations. Our foreign power plants are located in lower-cost regions, like Kenya, Guatemala, Honduras and Guadeloupe, which favorably impact payroll, maintenance expenses and other items. Our power plants in foreign locations are also newer than most of our domestic power plants and therefore tend to have lower maintenance costs and higher availability factors than our domestic power plants. Consequently, in the nine months ended September 30, 2024 and 2023, our foreign operations of the segment accounted for 40% and 49% of our total gross profits, 80% and 76% of our net income (assuming the majority of corporate operating expenses and financing are recorded under our domestic jurisdiction) and 31% and 39% of our EBITDA, respectively.

Previous wording

Product Segment. Our Product segment foreign revenues were approximately 96% and 92% of our total Product segment revenues for the six months ended June 30, 2024 and 2023, respectively.

Current wording

Product Segment. Our Product segment foreign revenues were approximately 94% and 93% of our total Product segment revenues for the nine months ended September 30, 2024 and 2023, respectively.

Previous wording

Energy Storage Segment. Our Energy Storage segment domestic revenues were 100% of our total Energy storage segment revenues for each of the three and six months ended June 30, 2024 and 2023.

Current wording

Energy Storage Segment. Our Energy Storage segment domestic revenues were 100% of our total Energy storage segment revenues for each of the three and nine months ended September 30, 2024 and 2023.

Previous wording

Revenues attributable to our Electricity segment for the three months ended June 30, 2024 were $166.2 million, compared to $155.3 million for the three months ended June 30, 2023. This increase of $10.9 million was mainly attributable to: (i) $8.6 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024; (ii) $4.3 million related to the Heber 1 power plant which resumed operations in May 2023 after a temporary shutdown due to a fire incident that occurred in February 2022; and (iii) $5.1 million related to the Puna power plant due to its higher power generation in 2024. This increase was partially offset by lower revenues of $3.6 million in the Dixie Valley power plant due to an unscheduled outage, as well as decreases in power generation in lesser amounts at a number of other power plants.

Current wording

Revenues attributable to our Electricity segment for the three months ended September 30, 2024 were $164.6 million, compared to $157.2 million for the three months ended September 30, 2023. This increase of $7.4 million was mainly attributable to: (i) $7.5 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024; (ii) $1.8 million related to the Heber 1 power plant which resumed operations in May 2023 after a temporary shutdown due to a fire incident that occurred in February 2022; and (iii) $7.4 million related to the Puna power plant due to its higher power generation in 2024. This increase was partially offset by lower revenues of $4.2 million in the Dixie Valley power plant due to an unscheduled outage during the period in 2024, $1.8 million in the Guadeloupe power plant due to maintenance issues, as well as decreases in power generation in lesser amounts at a number of other power plants.

Previous wording

Power generation in our power plants increased by 2.1% from 1,695,396 MWh in the three months ended June 30, 2023 to 1,731,282 MWh in the three months ended June 30, 2024. The increase in the quarter was primarily due to the inclusion of the new projects acquired early in the year, the contribution of Heber complex repowering and the improved operation at our Puna power plant. This increase was offset by curtailments in our Olkaria complex and lower generation at Dixie Valley as a result of unplanned outage.

Current wording

Power generation in our power plants increased by 1.4% from 1,651,880 MWh in the three months ended September 30, 2023 to 1,675,164 MWh in the three months ended September 30, 2024. The increase in the quarter was primarily due to the inclusion of the new projects acquired early in the year, the contribution of the Heber complex repowering and the improved operation at our Puna power plant. This increase was offset by curtailments in our Olkaria complex and lower generation at Dixie Valley as a result of an unplanned outage.

Previous wording

Revenues attributable to our Product segment for the three months ended June 30, 2024 were $37.8 million, compared to $33.5 million for the three months ended June 30, 2023. This increase of $4.4 million, or 13.1%, is primarily related to the progress in our projects and timing of when revenues are recognized during the period. During the three months ended June 30, 2024, Product revenues included projects primarily in New Zealand and Dominica, and during the three months ended June 30, 2023, Product revenues included projects primarily in New Zealand, Indonesia and the Philippines.

Current wording

Revenues attributable to our Product segment for the three months ended September 30, 2024 were $37.4 million, compared to $39.8 million for the three months ended September 30, 2023. This decrease of $2.5 million, or 6.2%, is primarily related to the progress in our projects and timing of when revenues are recognized during the period. During the three months ended September 30, 2024, Product revenues included projects primarily in New Zealand and Dominica, and during the three months ended September 30, 2023, Product revenues included projects primarily in New Zealand and Indonesia.

Previous wording

Revenues attributable to our Energy Storage segment for the three months ended June 30, 2024 were $8.9 million compared to $6.0 million for the three months ended June 30, 2023. This increase is primarily related to the new energy storage facilities which commenced commercial operation during 2023, primarily Andover in June 2023 and Pomona 2 in July 2023, as well as the East Flemington energy storage facility which commenced commercial operations during the first quarter of 2024.

Current wording

Revenues attributable to our Energy Storage segment for the three months ended September 30, 2024 were $9.8 million compared to $11.0 million for the three months ended September 30, 2023. This decrease is primarily related to lower prices in Texas in the third quarter of 2024 due to mild weather conditions, partially offset by the East Flemington energy storage facility which commenced commercial operations in the first quarter of 2024.

Previous wording

Total cost of revenues attributable to our Electricity segment for the three months ended June 30, 2024 was $110.5 million, compared to $109.4 million for the three months ended June 30, 2023. This increase of $1.1 million was primarily attributable to $6.3 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024. This increase was partially offset by lower costs across the Company’s other power plants in the three months ended June 30, 2024, compared to the same period in the previous year, in a number of other power plants.

Current wording

Total cost of revenues attributable to our Electricity segment for the three months ended September 30, 2024 was $114.9 million, compared to $107.2 million for the three months ended September 30, 2023. This increase of $7.8 million was primarily attributable to $6.9 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024, and $1.5 million related to the Puna power plant due to its higher power generation in 2024. This increase was partially offset by lower costs across the Company’s other power plants in the three months ended September 30, 2024, compared to the same period in the previous year.

Previous wording

Our total Electricity segment cost of revenues for the three months ended June 30, 2024 was 66.5% of Electricity revenues, compared to 70.4% for the three months ended June 30, 2023. The cost of revenues attributable to our international power plants for the three months ended June 30, 2024 was 19.1% of our total Electricity segment cost of revenues for this period compared to 17.8% for the same period in the prior year.

Current wording

Our total Electricity segment cost of revenues for the three months ended September 30, 2024 was 69.8% of Electricity segment revenues, compared to 68.2% for the three months ended September 30, 2023. The cost of revenues attributable to our international power plants for the three months ended September 30, 2024 was 16.9% of our total Electricity segment cost of revenues for this period compared to 16.6% for the same period in the prior year.

Previous wording

Total cost of revenues attributable to our Product segment for the three months ended June 30, 2024 was $32.7 million, compared to $30.0 million for the three months ended June 30, 2023, which represented a 8.9% increase. This increase is primarily attributable to the increase in Product segment revenues, as discussed above. As a percentage of total Product segment revenues, total cost of revenues attributable to our Product segment for the three months ended June 30, 2024, and 2023, was 86.3% and 89.6%, respectively, which results from the different profitability of the different projects included in each period.

Current wording

Total cost of revenues attributable to our Product segment for the three months ended September 30, 2024 was $30.2 million, compared to $32.4 million for the three months ended September 30, 2023, which represented a 6.9% decrease. This decrease is primarily attributable to the decrease in Product segment revenues, as discussed above. As a percentage of total Product segment revenues, total cost of revenues attributable to our Product segment for the three months ended September 30, 2024, and 2023, was 80.8% and 81.3%, respectively, which results from the different profitability of the different projects included in each period.

Previous wording

Research and development expenses for the three months ended June 30, 2024 were $1.7 million, compared to $2.1 million for the three months ended June 30, 2023. The decrease in research and development expenses, net is primarily related to the timing of when we invest in such related projects.

Current wording

Research and development expenses for the three months ended September 30, 2024 were $1.8 million, compared to $1.4 million for the three months ended September 30, 2023. The increase in research and development expenses, net is primarily related to the timing of when we allocate resources to research and development projects.

Previous wording

Selling and marketing expenses for the three months ended June 30, 2024 were $4.2 million compared to $5.4 million for the three months ended June 30, 2023. Selling and marketing expenses for the three months ended June 30, 2024 and 2023 constituted 2.0% and 2.8% of total revenues, respectively.

Current wording

Selling and marketing expenses for the three months ended September 30, 2024 were $4.2 million compared to $4.7 million for the three months ended September 30, 2023. Selling and marketing expenses for the three months ended September 30, 2024 and 2023 constituted 2.0% and 2.3% of total revenues, respectively.

Previous wording

General and administrative expenses for the three months ended June 30, 2024 were $18.0 million compared to $17.8 million for the three months ended June 30, 2023. General and administrative expenses for the three months ended June 30, 2024 and 2023 constituted 8.5% and 9.1% of total revenues, respectively. The increase in general and administrative expenses is primarily attributable to the timing of when we incur services from vendors.

Current wording

General and administrative expenses for the three months ended September 30, 2024 were $23.0 million compared to $14.0 million for the three months ended September 30, 2023. General and administrative expenses for the three months ended September 30, 2024 and 2023 constituted 10.8% and 6.8% of total revenues, respectively. The increase in general and administrative expenses is primarily attributable to consulting fees related to a settlement agreement with a third-party battery systems supplier of $4.8 million, insurance costs, amortization of stock-based awards, and timing of when we incur services from our vendors.

Previous wording

Write-off of long-lived assets for the six months ended June 30, 2024 was $1.0 million compared to none for the three months ended June 30, 2023. The write-off of long-lived assets is related to the termination of the waste heat agreement between the Company's wholly-owned subsidiary, OREG4, and Highline Electric Association, Inc., effective May 2024.

Current wording

Write-off of long-lived assets for the three months ended September 30, 2024 was $0.3 million compared to none for the three months ended September 30, 2023. The write-off of long-lived assets is related to the termination of the waste heat agreement between the Company's wholly-owned subsidiary, OREG4, and Highline Electric Association, Inc., effective May 2024.

Previous wording

Write-off of unsuccessful exploration activities for the three months ended June 30, 2024 was $1.4 million compared to none for the three months ended June 30, 2023. This write-off is related to exploration activities that the Company decided to no longer pursue.

Current wording

Write-off of unsuccessful exploration activities for the three months ended September 30, 2024 was $0.1 million compared to $2.3 for the three months ended September 30, 2023. This write-off is related to exploration activities that the Company decided to no longer pursue.

Previous wording

Interest Income for the three months ended June 30, 2024 was $2.6 million, compared to $4.9 million for the three months ended June 30, 2023. Interest income is primarily related to interest earned on cash and cash equivalents held by the Company during the period. The decrease in interest income is primarily related to lower balances of cash and cash equivalents period over period.

Current wording

Interest Income for the three months ended September 30, 2024 was $2.1 million, compared to $2.8 million for the three months ended September 30, 2023. Interest income is primarily related to interest earned on cash and cash equivalents held by the Company during the period. The decrease in interest income is primarily related to lower balances of cash and cash equivalents period over period.

Previous wording

Interest expense, net for the three months ended June 30, 2024 was $33.7 million, compared to $24.4 million for the three months ended June 30, 2023. This increase of $9.3 million was primarily attributable to interest costs relating to loan agreements entered into during, or subsequent to, the second quarter of 2023 such as: (i) the Mizrahi 2023 Loan entered into in November 2023; (ii) the Hapoalim 2023 Loan entered into in February 2023; (iii) the short-term commercial paper entered into in October 2023; (iv) the Hapoalim 2024 Loan entered into in January 2024; (v) the HSBC Bank 2024 Loan entered into in January 2024; (vi) the Mammoth Senior Secured Notes entered into in March 2024; (vii) the DEG 4 Loan entered into in April 2024; and (viii) the Discount 2024 Loan entered into in May 2024. This increase was partially offset by lower interest expenses on other existing loans as a result of scheduled payments.

Current wording

Interest expense, net for the three months ended September 30, 2024 was $34.8 million, compared to $25.1 million for the three months ended September 30, 2023. This increase of $9.8 million was primarily attributable to interest expense relating to loan agreements entered into subsequent to the third quarter of 2023 such as: (i) the Mizrahi 2023 Loan entered into in November 2023; (ii) the short-term commercial paper entered into in October 2023; (iii) the Hapoalim 2024 Loan and the HSBC Bank 2024 Loan entered into in January 2024; (iv) the Mammoth Senior Secured Notes entered into in March 2024; (v) the DEG 4 Loan entered into in April 2024; and (vi) the Discount 2024 Loan entered into in May 2024. This increase was partially offset by lower interest expenses on other existing loans as a result of scheduled payments.

Previous wording

Derivatives and foreign currency transaction gains and losses for the three months ended June 30, 2024 was a loss of $0.3 million, compared to a loss of $1.3 million for the three months ended June 30, 2023. Derivatives and foreign currency transaction gains (losses) primarily includes losses from foreign currency forward contracts which were not accounted for as hedge transactions, and impact of changes in the foreign currency exchange rate against the U.S. Dollar.

Current wording

Derivatives and foreign currency transaction gains and losses for the three months ended September 30, 2024 was a gain of $2.0 million, compared to a loss of $0.8 million for the three months ended September 30, 2023. Derivatives and foreign currency transaction gains (losses) primarily includes losses from foreign currency forward contracts which were not accounted for as hedge transactions, and the impact of changes in foreign currency exchange rate against the U.S. Dollar.

Previous wording

Income attributable to the sale of tax benefits for the three months ended June 30, 2024 was $15.8 million, compared to $15.0 million for the three months ended June 30, 2023. This income primarily represents the value of production tax credits (“PTCs”) and taxable income or loss generated by certain of our power plants allocated to investors under tax equity transactions. This increase of $0.8 million is primarily related to the North Valley tax equity transaction entered into in October 2023, and to income related to the expected sale of transferable production tax credits under the new IRA regulations of $3.6 million in the three months ended June 30, 2024, that is primarily related to the Heber 1 power plant, compared to $2.7 million in the three months ended June 30, 2023. This increase was partially offset by lower generation of PTC's by other tax equity transactions.

Current wording

Income attributable to the sale of tax benefits for the three months ended September 30, 2024 was $19.8 million, compared to $14.9 million for the three months ended September 30, 2023. This income primarily represents the value of production tax credits (“PTCs”) and taxable income or loss generated by certain of our power plants which are allocated to investors under tax equity transactions, and to income related to the expected sale of transferable production tax credits under the new IRA regulations. This increase of $4.8 million is primarily attributable to the Heber 1 power plant which resumed operations in May 2023, and to the Beowawe Repower power plant which commenced operations in the second quarter of 2024.

Previous wording

Other non-operating income (expense), net for the three months ended June 30, 2024 was income of $0.1 million, compared to $0.1 million for the three months ended June 30, 2023.

Current wording

Other non-operating income (expense), net for the three months ended September 30, 2024 was income of $0.0 million, compared to $0.1 million for the three months ended September 30, 2023.

Previous wording

Income tax benefit for the three months ended June 30, 2024 was $3.2 million compared to income tax benefit of $4.0 million for the three months ended June 30, 2023. Our effective tax rate for the three months ended June 30, 2024 and 2023, was (16.3)% and (21.3)%, respectively. The effective rate differs from the federal statutory rate of 21% primarily due to the generation of investment tax credits of $6.2 million, and $9.0 million for the three months ended June 30, 2024 and 2023, respectively, and the jurisdictional mix of earnings at differing tax rates.

Current wording

Income tax benefit for the three months ended September 30, 2024 was $1.2 million compared to income tax benefit of $7.1 million for the three months ended September 30, 2023. Our effective tax rate for the three months ended September 30, 2024 and 2023, was (4.8)% and (24.1)%, respectively. The effective rate differs from the federal statutory rate of 21% primarily due to the generation of investment tax credits of $9.6 million, and $6.6 million for the three months ended September 30, 2024 and 2023, respectively, and the jurisdictional mix of earnings at differing tax rates.

Previous wording

Equity in earnings of investees, net for the three months ended June 30, 2024 was earnings of $1.2 million, compared to $2.0 million for the three months ended June 30, 2023. Equity in earnings (losses) of investees, net is derived from our 12.75% share in the earnings or losses in the Sarulla Consortium ("Sarulla") and our 49% share in the earnings or losses in the Ijen geothermal project. In the second quarter of 2022, Sarulla agreed with its banks on a framework that will enable it to perform remediation works that are aimed to restore the power plants' performance. The first phase of the recovery plan included the drilling of an additional production well that was successful, and certain modifications to surface equipment that are still underway. Following the positive indications from the first phase, during the second quarter of 2024, Sarulla commenced discussions with the banks towards implementation of the additional phases. As we determined that the current situation and circumstances related to our equity method investment in Sarulla are temporary, no impairment testing was required for the period.

Current wording

Equity in earnings of investees, net for the three months ended September 30, 2024 was losses of $1.6 million, compared to losses of $0.4 million for the three months ended September 30, 2023. Equity in earnings (losses) of investees, net is derived from our 12.75% share in the earnings or losses in the Sarulla Consortium ("Sarulla") and our 49% share in the earnings or losses in the Ijen geothermal project. In the second quarter of 2022, Sarulla agreed with its banks on a framework that will enable it to perform remediation works that are aimed to restore the power plants' performance. The first phase of the recovery plan included the drilling of an additional production well that was successful, and certain modifications to surface equipment that are still underway. Following the positive indications from the first phase, during the second quarter of 2024, Sarulla commenced discussions with the banks towards implementation of the additional phases. As we determined that the current situation and circumstances related to our equity method investment in Sarulla are temporary, no impairment testing was required for the period.

Previous wording

Net income attributable to the Company’s stockholders for the three months ended June 30, 2024 was $22.2 million, compared to $24.2 million for the three months ended June 30, 2023, which represents a decrease of $1.9 million. This decrease is attributable to a decrease of $0.5 million in net income which was affected by the explanations described above, and an increase of $1.4 million in net income attributable to noncontrolling interest in the three months ended June 30, 2024, compared to the three months ended June 30, 2023, which is primarily related to the noncontrolling share in the net results of the Puna power plant.

Current wording

Net income attributable to the Company’s stockholders for the three months ended September 30, 2024 was $22.1 million, compared to $35.5 million for the three months ended September 30, 2023, which represents a decrease of $13.4 million. This decrease is attributable to a decrease of $12.0 million in net income which was affected by the explanations described above, and an increase of $1.3 million in net income attributable to noncontrolling interest in the three months ended September 30, 2024, compared to the three months ended September 30, 2023, which is primarily related to the noncontrolling share in the net results of the Puna and Guadaloupe power plants.

Previous wording

The table below compares revenues for the six months ended June 30, 2024 to the six months ended June 30, 2023.

Current wording

The table below compares revenues for the nine months ended September 30, 2024 to the nine months ended September 30, 2023.

Previous wording

Revenues attributable to our Electricity segment for the six months ended June 30, 2024, were $357.5 million, compared to $325.6 million for the six months ended June 30, 2023. The increase of $31.8 million in our Electricity segment revenues was mainly attributable to: (i) $18.0 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024; (ii) $10.5 million related to the Heber 1 power plant which resumed operations in May 2023 after a temporary shutdown due to a fire incident that occurred in February 2022; (iii) $9.3 million related to the Puna power plant due to its higher generation in 2024; and (iv) $3.6 million related to the North Valley power plant which started commercial operations in April 2023. This increase was partially offset by lower revenues of $3.2 million in the Dixie Valley power plant due to unscheduled maintenance, as well as additional decreases in lower amounts at a number of other power plants.

Current wording

Revenues attributable to our Electricity segment for the nine months ended September 30, 2024, were $522.1 million, compared to $482.8 million for the nine months ended September 30, 2023. The increase of $39.3 million in our Electricity segment revenues was mainly attributable to: (i) $25.5 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024; (ii) $12.3 million related to the Heber 1 power plant which resumed operations in May 2023 after a temporary shutdown due to a fire incident that occurred in February 2022; (iii) $16.7 million related to the Puna power plant due to its higher generation in 2024; and (iv) $3.5 million related to the North Valley power plant which started commercial operations in May 2023. This increase was partially offset by lower revenues of $7.4 million in the Dixie Valley power plant due to an unscheduled maintenance, and $3.7 million in the Guadeloupe power plant due to maintenance issues, both during the period in 2024, as well as additional decreases in lower amounts at a number of other power plants.

Previous wording

Power generation in our power plants increased by 5.1% from 3,577,338 MWh in the six months ended June 30, 2023 to 3,761,131 MWh in the six months ended June 30, 2024.

Current wording

Power generation in our power plants increased by 7.9% from 5,258,274 MWh in the nine months ended September 30, 2023 to 5,671,532 MWh in the nine months ended September 30, 2024.

Previous wording

Revenues attributable to our Product segment for thesix months ended June 30, 2024 were $62.7 million, compared to $43.5 million for thesix months ended June 30, 2023. This increase of $19.2 million, or 44.0%, is primarily related to the progress in our projects which results in the timing of when revenues are recognized. During thesix months ended June 30, 2024, Product revenues included projects primarily in New Zealand, Indonesia and Dominica, and during thesix months ended June 30, 2023, Product revenues primarily included projects in New Zealand and Indonesia.

Current wording

Revenues attributable to our Product segment for thenine months ended September 30, 2024 were $100.0 million, compared to $83.3 million for thenine months ended September 30, 2023. This increase of $16.7 million, or 20.0%, is primarily related to the progress in our projects which results in the timing of when revenues are recognized. During thenine months ended September 30, 2024, Product revenues included projects primarily in New Zealand and Dominica, and during thenine months ended September 30, 2023, Product revenues primarily included projects in New Zealand, Indonesia and the Philippines.

Previous wording

Revenues attributable to our Energy Storage segment for the six months ended June 30, 2024 were $17.0 million compared to $10.9 million for the six months ended June 30, 2023. The increase of$6.1 is mainly related tothe new energy storage facilities which commenced commercial operation during 2023, primarily Bowling Green in May 2023, Andover and Upton in June 2023, and Pomona 2 in July 2023, as well as the East Flemington energy storage facility which commenced commercial operations during the first quarter of 2024.

Current wording

Revenues attributable to our Energy Storage segment for the nine months ended September 30, 2024 were $26.8 million compared to $21.9 million for the nine months ended September 30, 2023. The increase of$4.9 is mainly related tothe new energy storage facilities which commenced commercial operation during 2023, primarily Bowling Green in May 2023, Andover and Upton in June 2023, and Pomona 2 in July 2023, as well as the East Flemington energy storage facility which commenced commercial operations during the first quarter of 2024. This increase was partially offset by lower prices in Texas due to mild weather conditions in the area in 2024 compared to 2023, and specifically during the third quarter, year over year.

Previous wording

The table below compares cost of revenues for the six months ended June 30, 2024 to the six months ended June 30, 2023.

Current wording

The table below compares cost of revenues for the nine months ended September 30, 2024 to the nine months ended September 30, 2023.

Previous wording

Total cost of revenues attributable to our Electricity segment for the six months ended June 30, 2024 was $227.2 million, compared to $204.2 million for the six months ended June 30, 2023. This increase of $23.1 million is primarily attributable to: (i) $12.4 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024; (ii) $6.3 million of income from business interruption insurance proceeds related to the Puna power plant as a result of the damage caused by the Kilauea volcano eruption in May 2018, which were included in 2023, compared to none in 2024; and (iii) $2.9 million related to the start of commercial operation of North Valley in April 2023.

Current wording

Total cost of revenues attributable to our Electricity segment for the nine months ended September 30, 2024 was $342.2 million, compared to $311.3 million for the nine months ended September 30, 2023. This increase of $30.8 million is primarily attributable to: (i) $19.3 million related to the geothermal and solar power plants included in the Enel purchase transaction which were consolidated by the Company starting the first quarter of 2024; (ii) $6.3 million of income from business interruption insurance proceeds related to the Puna power plant as a result of the damage caused by the Kilauea volcano eruption in May 2018, which were included in cost of revenues in 2023, compared to none in 2024; (iii) $2.9 million related to maintenance issues in the Guadeloupe power plant; and (iv) $3.1 million related to the start of commercial operation of the North Valley power plant in May 2023. This increase was partially offset by lower cost of revenues in other power plants.

Previous wording

Our total Electricity segment cost of revenues for the six months ended June 30, 2024 was 63.6% of Electricity revenues, compared to 62.7% for the six months ended June 30, 2023, including the impact from business interruption insurance proceeds described above. The cost of revenues attributable to our international power plants for the six months ended June 30, 2024 was 18.6% of our total Electricity segment cost of revenues for this period, compared to 18.0% for the same period in the prior year.

Current wording

Our total Electricity segment cost of revenues for the nine months ended September 30, 2024 was 65.5% of Electricity revenues, compared to 64.5% for the nine months ended September 30, 2023, including the impact from business interruption insurance proceeds described above. The cost of revenues attributable to our international power plants for the nine months ended September 30, 2024 was 18.0% of our total Electricity segment cost of revenues for this period, compared to 17.5% for the same period in the prior year.

Previous wording

Total cost of revenues attributable to our Product segment for the six months ended June 30, 2024 was $53.8 million, compared to $39.3 million for the six months ended June 30, 2023, which represented a 36.8% increase. This increase was primarily attributable to the increase in Product segment revenues as discussed above. As a percentage of total Product segment revenues, our total cost of revenues attributable to our Product segment for the six months ended June 30, 2024, and 2023, was 85.9% and 90.4%, respectively, which results from the different profitability of the different projects included in each period.

Current wording

Total cost of revenues attributable to our Product segment for the nine months ended September 30, 2024 was $84.0 million, compared to $71.7 million for the nine months ended September 30, 2023, which represented a 17.1% increase. This increase was primarily attributable to the increase in Product segment revenues as discussed above. As a percentage of total Product segment revenues, our total cost of revenues attributable to our Product segment for the nine months ended September 30, 2024, and 2023, was 84.0% and 86.1%, respectively, which results from the different profitability of the different projects included in each period.

Previous wording

Cost of revenues attributable to our Energy Storage segment for the six months ended June 30, 2024 was $15.9 million compared to $11.0 million for the six months ended June 30, 2023. This increase is related to the corresponding increase in Energy Storage revenues as described above.

Current wording

Cost of revenues attributable to our Energy Storage segment for the nine months ended September 30, 2024 was $23.7 million compared to $19.4 million for the nine months ended September 30, 2023. This increase is related to the new storage facilities and corresponding increase in Energy Storage revenues as described above.

Previous wording

Research and development expenses for the six months ended June 30, 2024 were $3.3 million, compared to $3.4 million for the six months ended June 30, 2023. The decrease in research and development expenses is mainly attributable to the timing of research and development projects that took place during the six months ended June 30, 2024 compared to the corresponding period in 2023.

Current wording

Research and development expenses for the nine months ended September 30, 2024 were $5.1 million, compared to $4.8 million for the nine months ended September 30, 2023. The increase in research and development expenses is mainly attributable to the timing of research and development projects that took place during the nine months ended September 30, 2024 compared to the corresponding period in 2023.

Previous wording

Selling and marketing expenses for the six months ended June 30, 2024 were $9.3 million compared to $9.3 million for the six months ended June 30, 2023. Selling and marketing expenses for the six months ended June 30, 2024, constituted 2.1% of total revenues for such period, compared to 2.5% for the six months ended June 30, 2023.

Current wording

Selling and marketing expenses for the nine months ended September 30, 2024 were $13.5 million compared to $14.0 million for the nine months ended September 30, 2023. Selling and marketing expenses for the nine months ended September 30, 2024, constituted 2.1% of total revenues for such period, compared to 2.4% for the nine months ended September 30, 2023.

Previous wording

General and administrative expenses for the six months ended June 30, 2024 were $37.6 million compared to $35.5 million for the six months ended June 30, 2023. The increase of $2.1 million in general and administrative expenses is primarily attributable to the timing of when we incur services, including $1.3 million in expenses related to the Enel purchase transaction incurred in the first quarter of 2024, as well as higher amortization of stock-based compensation costs.

Current wording

General and administrative expenses for the nine months ended September 30, 2024 were $60.5 million compared to $49.5 million for the nine months ended September 30, 2023. The increase of $11.0 million in general and administrative expenses is primarily attributable to consulting fees related to a settlement agreement with a third-party battery systems supplier of $4.8 million, insurance costs, amortization of stock-based awards, and the timing of when we incur services from our vendors.