Clearway Energy, Inc.
For the period ended Mar 31, 2026. Filed May 8, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 8, 2026
CWEN$34.10-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-05.
0001628280-25-049051
Item 2. Management’s Discussion and Analysis of Financial Condition and the Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-08.
0001628280-26-032385
ITEM 2. — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 142 previous paragraphs and 116 current paragraphs.
64 unchanged; 28 reworded; 24 added; 47 removed; 3 previous and 0 current paragraphs rearranged.
Tables are not compared: 21 previous and 18 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (24)
Current report
ITEM 2 — Management’s Discussion and Analysis of Financial Condition and the Results of Operations
Current report
(c) Facilities are part of the Cardinal Portfolio acquisition, which closed on March 30, 2026, as further described in Note 3, Acquisitions.
Current report
(e) The Goat Mountain wind facility commenced repowering activities in February 2026 and was taken offline. Repowering commercial operations is expected to occur in the second half of 2027.
Current report
•On March 30, 2026, the Company, through its indirect subsidiaries, Cardinal Purchaser LLC and Cardinal JV Purchaser LLC, completed the acquisition of the Cardinal Portfolio for total cash consideration of $324 million, subject to post-closing adjustments. Of the total consideration, $244 million was paid by Cardinal Purchaser LLC related to facilities consolidated by the Company and $80 million was paid by Cardinal JV Purchaser LLC related to facilities held through a joint venture with a third-party investor, recorded as an equity method investment. After factoring in cash acquired, transaction expenses and proceeds from the related financing activities, the Company estimates that its net capital investment in the Cardinal Portfolio will be approximately $240 million. See Note 3, Acquisitions, for further discussion of the transaction.
Current report
Financing Activities
Current report
•On May 1, 2026, when the Honeycomb Portfolio BESS facilities reached substantial completion, the Company paid $81 million to Clearway Renew as additional purchase price in connection with the Company’s acquisition of Honeycomb TargetCo from Clearway Renew on October 15, 2025. The Company’s total capital investment in Honeycomb TargetCo was $97 million. Also, on May 1, 2026, the tax equity investor in Honeycomb TE Holdco LLC contributed an additional $254 million, which was utilized along with the $60 million previously held in escrow, to repay the tax equity bridge loan and to pay associated fees with the remaining proceeds distributed to CEG. See Note 7, Long-term Debt, for further discussion of the transaction.
Current report
•On March 30, 2026, the Company, through its indirect subsidiary, Cardinal Investment Holdco LLC, borrowed $100 million under a new financing arrangement that was entered into in February 2026 to partially fund the acquisition of the Cardinal Portfolio. In connection with the acquisition, the Company also assumed non-recourse facility-level debt associated with certain of the acquired facilities. See Note 7, Long-term Debt, for further discussion of the financing arrangement and assumed non-recourse facility-level debt.
Current report
•On March 27, 2026, the Company restructured its existing energy‑related commodity contract associated with the Mesquite Sky wind facility, which resulted in an in-substance financing to settle derivative liabilities over time. The term financing obligation has an initial carrying amount of $127 million and total payments over the term of the arrangement are $162 million. In connection with the restructuring, the Company also entered into a 15‑year PPA with an investment‑grade counterparty. See Note 7, Long-term Debt, for further discussion of the Mesquite Sky restructuring.
Current report
•On February 27, 2026, the Company, through its indirect subsidiaries, Goat Mountain Class B Holdco LLC and Goat Wind LLC, as co-borrowers, entered into a financing arrangement for non-recourse debt for a total commitment of $703 million. The Company made initial borrowings under the arrangement to fund costs associated with the Goat Mountain repowering, including payments under the development services agreement with Clearway Renew. See Note 7, Long-term Debt, and Note 12, Related Party Transactions, for further discussion.
Current report
•On January 15, 2026, the Company repaid the $231 million outstanding on the Pine Forest tax credit transfer bridge loan utilizing the proceeds received from the sale of transferable ITCs and distributed the remaining $51 million to CEG, as further described in Note 7, Long-term Debt, and Note 11, Income Taxes.
Current report
•On January 13, 2026, Clearway Energy Operating LLC completed the sale of $600 million aggregate principal amount of 5.75% senior unsecured notes due 2034, or the 2034 Senior Notes. See Note 7, Long-term Debt, for further discussion of the 2034 Senior Notes.
Current report
Depreciation, Amortization and Accretion
Current report
Depreciation, amortization and accretion increased by $19 million during the three months ended March 31, 2026, compared to the same period in 2025, primarily due to the solar and BESS acquisitions referenced above.
Current report
Income Tax Benefit
Current report
Net Income (Loss) Attributable to Noncontrolling Interests and Redeemable Noncontrolling Interests
Current report
For the three months ended March 31, 2026, the Company had net income of $95 million attributable to noncontrolling interests and redeemable noncontrolling interests comprised of the following:
Current report
For the three months ended March 31, 2025, the Company had a net loss of $101 million attributable to noncontrolling interests comprised of the following:
Current report
Goat Mountain Repowering Financing— On February 27, 2026, the Company, through its indirect subsidiaries, Goat Mountain Class B Holdco LLC and Goat Wind LLC, as co-borrowers, entered into a financing arrangement for non-recourse debt for a total commitment of $703 million, which consists of a construction loan that converts to a five-year term loan upon substantial completion of the repowering, as well as bridge loans to be repaid with the proceeds from the tax equity investor. The construction loan and bridge loans bear interest at a rate of SOFR plus 1.50% and mature on the term conversion date. The initial borrowing of $140 million was primarily used to fund costs associated with the Goat Mountain repowering, including payments under the development services agreement, deferred debt issuance costs and capital expenditures. Under the financing arrangement, the Company borrowed $151 million through March 31, 2026. The Company estimates that its total capital investment in the Goat Mountain repowering will be $200 million, subject to closing adjustments.
Current report
2034 Senior Notes — On January 13, 2026, Clearway Energy Operating LLC completed the sale of $600 million aggregate principal amount of senior unsecured notes due 2034, or the 2034 Senior Notes. The 2034 Senior Notes bear interest at a rate of 5.750% per annum and mature on January 15, 2034. Interest on the 2034 Senior Notes is payable semi-annually on January 15 and July 15 of each year, beginning on July 15, 2026. The net proceeds from the 2034 Senior Notes were used to repay $361 million in outstanding borrowings under the revolving credit facility and for general corporate purposes.
Current report
Cardinal Portfolio Acquisition—On March 30, 2026, the Company, through its indirect subsidiaries, Cardinal Purchaser LLC and Cardinal JV Purchaser LLC, completed the acquisition of the Cardinal Portfolio for total cash consideration of $324 million, subject to post-closing adjustments. Of the total consideration, $244 million was paid by Cardinal Purchaser LLC related to facilities consolidated by the Company and $80 million was paid by Cardinal JV Purchaser LLC related to facilities held through a joint venture with a third-party investor. The Cardinal Portfolio has a weighted average remaining contract duration of approximately 10 years. The acquisition was funded with $100 million in borrowings under the new financing arrangement entered into in connection with the acquisition, as well as existing sources of liquidity. In connection with the acquisition, the Company also assumed non-recourse facility-level debt associated with certain of the acquired facilities. After factoring in cash acquired, transaction expenses and proceeds from the related financing activities, the Company estimates that its net capital investment in the Cardinal Portfolio will be approximately $240 million.
Current report
Mesquite Sky Restructuring— On March 27, 2026, the Company restructured its existing energy‑related commodity contract associated with the Mesquite Sky wind facility, which resulted in an in‑substance financing to settle existing derivative liabilities over time. As a result of the restructuring, the Company derecognized derivative liabilities with a fair value of $115 million, as well as $12 million owed to the counterparty that was previously included in other non‑current liabilities, and recognized a term financing obligation with an initial carrying amount of $127 million. The financing obligation is repaid through fixed monthly payments beginning in May 2026 and matures on September 30, 2035. Total payments over the term of the arrangement are $162 million, which implies an effective interest rate of approximately 5.436%. In connection with the restructuring, the Company also entered into a 15‑year PPA with an investment‑grade counterparty, which replaces the volumetric and price exposure of Mesquite Sky’s energy‑related commodity contract with more favorable pricing.
Current report
Pine Forest—On January 15, 2026, the Company repaid the $231 million outstanding on the tax credit transfer bridge loan utilizing the proceeds received from the sale of transferable ITCs and distributed the remaining $51 million to CEG, as further described in Note 7, Long-term Debt, and Note 11, Income Taxes.
Current report
As a result of the Class A Conversion discussed in Note 9, Changes in Capital Structure, the Company no longer has any Class A common stock outstanding, and holders of the Company’s former Class A common stock converted into Class C common stock remain entitled to receive dividends, if declared by the Company, on the same basis as prior to the conversion.
Current report
The Company has an unrecognized tax benefit of $19 million as of March 31, 2026.
Removed paragraphs (47)
Previous report
(d) On October 2, 2025, the Company, through its indirect subsidiary, WV Wind Holdco LLC, sold 100% of its membership interests in Mount Storm Wind LLC, which owns Mt. Storm, to Clearway Renew, as further described in Note 3, Acquisitions and Dispositions.
Previous report
•On October 3, 2025, the Company entered into a binding agreement to acquire a 613 MW operational solar portfolio located in eight states, from a third party for a base purchase price of approximately $305 million in cash, subject to certain customary price adjustments. For 12 facilities in the portfolio located in the Western U.S. and comprising of 227 MW, the Company will co-invest in a 50/50 joint venture with a third-party cash equity investor. The weighted average remaining contract duration of the overall portfolio is approximately 10 years. After factoring in estimated closing adjustments and proceeds from facility-level financings, including the third-party cash equity investor in a subset of the portfolio, the Company expects its net capital commitment to acquire the portfolio to be between $210 million and $230 million. The Company expects to fund the acquisition primarily utilizing existing sources of liquidity. The consummation of the transaction is subject to customary closing conditions and certain third-party approvals and is expected to occur in the first half of 2026.
Previous report
•On July 16, 2025, the Company, through its indirect subsidiary, Catalina Solar Investment LLC, acquired Catalina Solar Lessee Holdco LLC, which leases and operates the Catalina solar facility, for approximately $127 million, which excludes $1 million in transaction expenses incurred in connection with the acquisition during thenine months ended September 30, 2025. After factoring in cash reserves acquired and transaction expenses, the Company’s net capital investment in Catalina is expected to be $128 million. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
•On April 29, 2025, the Company, through its indirect subsidiary, Washington Wind LLC, acquired the Tuolumne wind facility from an investment-grade regulated entity for approximately $210 million, which excludes $1 million in transaction expenses incurred in connection with the acquisition during thenine months ended September 30, 2025. The Company’s net capital investment in Tuolumne was $59 million. See Note 3, Acquisitions and Dispositions for further discussion of the transaction.
Previous report
Drop Down Transactions
Previous report
•On October 15, 2025, the Company, through its indirect subsidiary, Honeycomb 1 Holdco LLC, acquired Honeycomb TargetCo LLC, the indirect owner of the Honeycomb Portfolio, from Clearway Renew for initial cash consideration of $16 million. At substantial completion, which is expected to occur in the first half of 2026, the Company estimates it will pay an additional $62 million to Clearway Renew. The Company estimates that its total capital investment in Honeycomb TargetCo LLC will be $78 million, excluding the impact of any closing adjustments noted in the purchase agreement. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
•On October 2, 2025, the Company, through its indirect subsidiary, WV Wind Holdco LLC, sold 100% of its membership interests in Mount Storm Wind LLC, which owns Mt. Storm, to Clearway Renew for $152 million in cash consideration in order for Clearway Renew to repower the facility. The repowering of the facility is expected to increase the facility’s capacity to 335 MW. Mechanical completion of the first phase of the repowering is expected to occur in the second half of 2026 with the second phase of the repowering expected to occur in the second half of 2027. Additionally, the Company has an exclusive option to purchase the Class B membership interests in the tax equity fund that, upon mechanical completion of the first phase of the repowering of the facility, will own Mt. Storm. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction. In connection with the agreement with Clearway Renew to sell its membership interests in Mt. Storm, on May 1, 2025, the Company bought down a portion of Mt. Storm’s contract to sell power to a counterparty through a hedge agreement and paid approximately $35 million to the hedge counterparty to reduce the contract by approximately 50%. On July 22, 2025, the Company paid approximately $39 million to the hedge counterparty to buy out the remaining contract.
Previous report
•On April 29, 2025, the Company, through its indirect subsidiary, LV-Daggett Parent Holdco LLC, acquired Daggett 1 Class B, the indirect owner of the Daggett 1 BESS facility, from Clearway Renew for initial cash consideration of $11 million. On September 19, 2025, when the facility reached substantial completion, the Company paid $42 million to Clearway Renew as additional purchase price. On October 15, 2025, the Company paid $4 million to Clearway Renew as a purchase price true up. The Company’s total capital investment in Daggett 1 Class B was $57 million. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
•On April 29, 2025, the Company, through its indirect subsidiary, LV-Daggett Parent Holdco LLC, acquired Luna Valley Class B, the indirect owner of the Luna Valley solar facility, from Clearway Renew for initial cash consideration of $18 million. On September 4, 2025, when the facility reached substantial completion, the Company paid $72 million to Clearway Renew as additional purchase price. On October 15, 2025, the Company paid $29 million to Clearway Renew as a purchase price true up. The Company's total capital investment in Luna Valley Class B was $119 million. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
•On March 20, 2025, the Company, through its indirect subsidiary, Rosamond South Investment LLC, acquired the Class A membership interests in Rosie South TargetCo, a partnership and the indirect owner of the Rosamond South I solar and BESS facility, from Clearway Renew for initial cash consideration of $4 million. Simultaneously, a third-party cash equity investor acquired the Class B membership interests in Rosie South TargetCo from Clearway Renew for initial cash consideration of $10 million. On August 13, 2025 when the facility reached substantial completion, the Company paid $29 million to Clearway Renew as additional purchase price and the third-party cash equity investor contributed an additional $41 million. The Company’s total capital investment in Rosie South TargetCo was $33 million. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
•On July 23, 2025, the Company entered into an agreement with Clearway Renew to repower the Goat Mountain facility, which is located in Sterling City, Texas. The Company estimates that its total capital investment in the Goat Mountain repowering will be $200 million, subject to closing adjustments. Contingent upon achieving repowering commercial operations in 2027, the 360 MW facility will sell power toan investment-grade counterparty under a new 15-year PPA.
Previous report
•On June 10, 2025, the Company, through its indirect subsidiary, Pine Forest CE Class A Owner LLC, acquired the Class A membership interests in Pine Forest TargetCo, a partnership and the indirect owner of the Pine Forest solar and BESS facility, from Clearway Renew for initial cash consideration of $18 million. Simultaneously, a third-party cash equity investor acquired the Class B membership interests in Pine Forest TargetCo from Clearway Renew for initial cash consideration of $36 million. Also on June 10, 2025, the Company, through its indirect subsidiary, Pine Forest TE Class A, contributed $9 million to acquire the Class A membership interests in Pine Forest TE HoldCo LLC. At substantial completion, which is expected to occur in the fourth quarter of 2025, the Company estimates it will pay an additional $72 million to Clearway Renew for its Class A membership interests in Pine Forest TargetCo and will contribute an additional $37 million for its Class A membership interests in Pine Forest TE HoldCo LLC. In addition, the third-party cash equity investor in Pine Forest TargetCo is expected to contribute an additional $144 million. The Company estimates that its total capital investment in Pine Forest TargetCo will be $136 million, excluding the impact of any closing adjustments noted in the purchase agreement. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
RA Agreements
Previous report
•On January 14, 2025, the Company contracted with a load serving entity to sell approximately 75 MW of El Segundo’s RA commencing in August 2026 and ending in December 2029. On February 4, 2025, the Company contracted with an additional load serving entity to sell approximately 197 MW of El Segundo’s RA commencing in August 2026 and ending in December 2029. El Segundo is now contracted for 100% of its capacity through 2027 and approximately 50% of its capacity through 2028.
Previous report
Facility-level Financing Activities
Previous report
•In connection with the 2025 Drop Downs of Rosamond South I, Luna Valley, Daggett 1 and Pine Forest, the Company assumed non-recourse facility-level debt. See Note 7, Long-term Debt, for further discussion of the non-recourse facility-level debt associated with each facility.
Previous report
•On May 21, 2025, when the Dan’s Mountain wind facility reached substantial completion, the Company paid $36 million to Clearway Renew as additional purchase price in connection with the Company’s acquisition of the Class A membership interests in Dan’s Mountain TargetCo on November 18, 2024. Also, on May 21, 2025, a third-party cash equity investor contributed $45 million to acquire the Class B membership interests in Dan’s Mountain TargetCo from Clearway Renew and the tax equity investor contributed an additional $90 million. The Company utilized the combined proceeds to repay the cash equity bridge loan, to repay the tax equity bridge loan and to pay associated fees with the remaining proceeds distributed to CEG. The Company’s total capital investment in Dan’s Mountain TargetCo was $43 million. See Note 7, Long-term Debt, for further discussion of the transaction.
Previous report
•On April 29, 2025, in order to partially fund the third-party acquisition of the Tuolumne wind facility, the Company entered into a financing agreement, which included the issuance of a $163 million term loan, as well as $22 million in letters of credit in support of debt service and facility obligations. See Note 7, Long-term Debt, for further discussion of the financing agreement.
Previous report
•On April 9, 2025, the Company, through its indirect subsidiary, Buckthorn Solar Portfolio LLC, refinanced its credit agreement, which was scheduled to mature in May 2025, resulting in the issuance of a $104 million term loan facility, as well as $22 million in letters of credit in support of debt service and facility obligations. The Company utilized the proceeds from the term loan and existing sources of liquidity to pay off the existing debt. See Note 7, Long-term Debt, for further discussion of the refinanced credit agreement.
Previous report
On March 6, 2024, the SEC adopted a new set of rules that would require a wide range of climate-related disclosures, including material climate-related risks, information on any climate-related targets or goals that are material to the registrant’s business, results of operations or financial condition, Scope 1 and Scope 2 GHG emissions on a phased-in basis by certain larger registrants when those emissions are material and the filing of an attestation report covering the same, and disclosure of the financial statement effects of severe weather events and other natural conditions including costs and losses. Litigation challenging the rules was filed by multiple parties in multiple jurisdictions, which was consolidated and assigned to the U.S. Court of Appeals for the Eighth Circuit. On April 4, 2024, the SEC announced that it was voluntarily delaying the implementation of the climate disclosure rules while the U.S. Court of Appeals considered the litigation. On March 27, 2025, the SEC voted to end the defense of the rules in the litigation. On September 12, 2025, the U.S. Court of Appeals denied the SEC’s request to proceed with the case and indicated that the case would be held in abeyance until the SEC either renews its defense of the rules or revises the rules via notice-and-comment rulemaking.
Previous report
On July 4, 2025, federal tax legislation was enacted. Among other changes, the federal tax legislation phases out, repeals, and/or adds stricter eligibility requirements for business tax credits and incentives for the development of clean energy facilities and production of clean energy, including wind, solar and BESS facilities. Among other things, (i) wind and solar facilities that begin construction after July 4, 2026 must be placed in service by December 31, 2027 in order to qualify for production tax credits or investment tax credits, (ii) BESS facilities that begin construction by December 31, 2033 receive full investment tax credit value, stepping down to 75% for BESS facilities that begin construction in 2034, 50% for BESS facilities that begin construction in 2035 and 0% for BESS facilities that begin construction after 2035 and (iii) for facilities that begin construction after 2024, new foreign entity of concern requirements will restrict availability of the credits to wind, solar and BESS facilities if the entity that owns the facility has certain relationships with or makes certain payments to foreign entities of concern and, for facilities that begin construction after 2025, if the percentage of components in the facility manufactured by foreign entities of concern exceeds a specified percentage.
Previous report
On July 7, 2025, a federal executive order was issued directing the Secretary of the Treasury to issue, within 45 days, new or revised guidance regarding the interpretation of “begin construction” requirements for wind, solar and BESS facilities that claim “technology neutral” tax credits under sections 45Y or 48E of the Internal Revenue Code. On August 15, 2025, the U.S. Treasury Department issued new guidance which requires developers of wind and solar projects with a maximum net output of greater than 1.5 megawatts to perform physical work of a significant nature to qualify a project as having started, and then meet a continuity test. Under the continuity test, developers must place a project in service within four years after the end of the year in which construction starts or show that construction has been continuous from and after the start. The new guidance applies only to wind and solar projects that seek to qualify for “technology neutral credits” under Sections 45Y and 48E of the Internal Revenue Code and applies only for purposes of determining whether projects began construction before July 4, 2026. It does not apply to projects that began construction prior to September 2, 2025.
Previous report
On July 29, 2025, the United States Environmental Protection Agency, or the EPA, issued an interim final rule extending several compliance deadlines associated with the strict new methane rules for the oil and gas industry that were published in March 2024 and took effect in May 2024. On July 29, 2025, the EPA released a pre-publication proposed rule which would rescind the EPA’s 2009 final rule under the Clean Air Act finding that greenhouse gases endanger the public health and welfare of current and future generations and that emissions of greenhouse gases from new motor vehicles contribute to greenhouse gas pollution that threatens the public health and welfare. On September 16, 2025, the EPA announced a proposal to end the Greenhouse Gas Reporting Program for all sectors except petroleum and natural gas systems (excluding reporting for natural gas distribution). Reporting for petroleum and natural gas systems under the Greenhouse Gas Reporting Program would be deferred until 2034 under the proposal.
Previous report
Operating revenues decreased by $57 million during the three months ended September 30, 2025, compared to the same period in 2024, due to a combination of the drivers summarized in the table below:
Previous report
Cost of Fuels
Previous report
Cost of fuels decreased by $13 million during the three months ended September 30, 2025, compared to the same period in 2024, primarily due to lower generation at the Walnut Creek, Marsh Landing and El Segundo facilities due to milder weather, which resulted in less fuel purchases.
Previous report
Income Tax (Benefit) Expense
Previous report
For the three months ended September 30, 2025, the Company had a net loss of $176 million attributable to noncontrolling interests and redeemable noncontrolling interests comprised of the following:
Previous report
For the three months ended September 30, 2024, the Company had a net loss of $9 million attributable to noncontrolling interests and redeemable noncontrolling interests comprised of the following:
Previous report
Operating Revenues
Previous report
Cost of Fuels
Previous report
Cost of fuels decreased by $29 million during the nine months ended September 30, 2025, compared to the same period in 2024, primarily due to lower generation at the Walnut Creek, Marsh Landing and El Segundo facilities due to milder weather, which resulted in less fuel purchases.
Previous report
Operations and Maintenance Expense
Previous report
Operation and maintenance expense increased by $31 million during the nine months ended September 30, 2025, compared to the same period in 2024, due to a combination of the drivers summarized in the table below:
Previous report
Income Tax (Benefit) Expense
Previous report
For the nine months ended September 30, 2025, the Company had a net loss of $305 million attributable to noncontrolling interests and redeemable noncontrolling interests comprised of the following:
Previous report
For the nine months ended September 30, 2024, the Company had a net loss of $100 million attributable to noncontrolling interests and redeemable noncontrolling interests comprised of the following:
Previous report
Mt. Storm Sale to Clearway Renew — On October 2, 2025, the Company, through its indirect subsidiary, WV Wind Holdco LLC, sold 100% of its membership interests in Mount Storm Wind LLC, which owns Mt. Storm to Clearway Renew for $152 million in cash consideration in order for Clearway Renew to repower the facility. The repowering of the facility is expected to increase the facility’s capacity to 335 MW. Mechanical completion of the first phase of the repowering is expected to occur in the second half of 2026 with the second phase of the repowering expected to occur in the second half of 2027. Additionally, the Company has an exclusive option to purchase the Class B membership interests in the tax equity fund that, upon mechanical completion of the first phase of the repowering of the facility, will own Mt. Storm. Upon achieving repowering commercial operations, which is expected to occur in the second half of 2027, the facility will sell power to Microsoft under a 20-year PPA. See Note 3, Acquisitions and Dispositions, for further discussion of the transaction.
Previous report
At-The-Market Equity Offering Program — On August 6, 2025, the Company entered into an equity distribution agreement with Morgan Stanley & Co. LLC, BofA Securities, Inc., Citigroup Global Markets Inc., J.P. Morgan Securities LLC and Wells Fargo Securities LLC, as sales agents. Pursuant to the terms of the agreement, the Company may offer and sell shares of its Class C common stock, par value $0.01 per share, from time to time through the sales agents, as the Company’s sales agents for the offer and sale of the shares, up to an aggregate sales price of $100 million through an at-the-market equity offering program, or ATM Program. During the third quarter of 2025, the Company issued 2,933 shares of Class C common stock under the ATM Program for gross proceeds of less than $1 million. During October 2025, the Company issued 785,047 shares of Class C common stock under the ATM Program for gross proceeds of $25 million and incurred fees of less than $1 million. The Company intends to use the net proceeds from the sale of shares under the ATM Program for general corporate purposes, which may include the repayment or refinancing of indebtedness and the funding of working capital, capital expenditures, acquisitions and investments, and the Company may invest funds not required immediately for such purposes in marketable securities and short-term investments.
Previous report
Honeycomb Portfolio Drop Down — On October 15, 2025, the Company, through its indirect subsidiary, Honeycomb 1 Holdco LLC, acquired Honeycomb TargetCo LLC, the indirect owner of the Honeycomb Portfolio, from Clearway Renew for initial cash consideration of $16 million. At substantial completion, which is expected to occur in the first half of 2026, the Company estimates it will pay an additional $62 million to Clearway Renew. The Company estimates that its total capital investment in Honeycomb TargetCo LLC will be $78 million, excluding the impact of any closing adjustments noted in the purchase agreement. The Honeycomb Portfolio has 20-year PPAs with an investment-grade utility that will commence when the underlying operating assets reach commercial operations, which is expected to occur in the first half of 2026. The acquisition was funded with existing sources of liquidity.
Showing the first 40 of 47 passages. Open the source sections for the rest.
Reworded paragraphs (28)
Previous wording
As you read this discussion and analysis, refer to the Company’s consolidated financial statements to this Form 10-Q, which present the results of operations for the three and nine months ended September 30, 2025 and 2024. Also refer to the Company’s 2024 Form 10-K, which includes detailed discussions of various items impacting the Company’s business, results of operations and financial condition.
Current wording
As you read this discussion and analysis, refer to the Company’s consolidated financial statements to this Form 10-Q, which present the results of operations for the three months ended March 31, 2026 and 2025. Also refer to the Company’s 2025 Form 10-K, which includes detailed discussions of various items impacting the Company’s business, results of operations and financial condition.
Previous wording
Clearway Energy, Inc., together with its consolidated subsidiaries, or the Company, is a publicly-traded energy infrastructure investor with a focus on investments in clean energy and owner of modern, sustainable and long-term contracted assets across North America. The Company is sponsored by Clearway Energy Group LLC, or CEG, which is equally owned by GIP and TotalEnergies.
Current wording
Clearway Energy, Inc., together with its consolidated subsidiaries, or the Company, is a publicly-traded energy infrastructure investor with a focus on investments in clean energy and owner of modern, sustainable and long-term contracted assets across North America. The Company is sponsored by Clearway Energy Group LLC, or CEG.
Previous wording
The Company is one of the largest owners of clean energy generation assets in the U.S. The Company’s portfolio comprises approximately 12.7 GW of gross capacity in 27 states, including approximately 9.9 GW of wind, solar and battery energy storage systems, or BESS, and approximately 2.8 GW of dispatchable combustion-based power generation assets included in the Flexible Generation segment that provide critical grid reliability services. Through this environmentally-sound, diversified and primarily contracted portfolio, the Company endeavors to provide its investors with stable and growing dividend income. The majority of the Company’s revenues are derived from long-term contractual arrangements for the output or capacity from these assets. The weighted average remaining contract duration of the Company’s Renewables & Storage segment offtake agreements was approximately 11 yearsas of September 30, 2025 based on CAFD.
Current wording
The Company is one of the largest owners of clean energy generation assets in the U.S. The Company’s portfolio comprises approximately 13.6 GW of gross capacity in 27 states, including approximately 10.8 GW of wind, solar and battery energy storage systems, or BESS, and approximately 2.8 GW of dispatchable combustion-based power generation assets included in the Flexible Generation segment that provide critical grid reliability services. Through this environmentally-sound, diversified and primarily contracted portfolio, the Company endeavors to provide its investors with stable and growing dividend income. The majority of the Company’s revenues are derived from long-term contractual arrangements for the output or capacity from these assets. The weighted average remaining contract duration of the Company’s Renewables & Storage segment offtake agreements was approximately 12 yearsas of March 31, 2026 based on CAFD.
Previous wording
The Company is subject to a wide range of environmental laws during the development, construction, ownership and operation of facilities. These existing and future laws generally require that governmental permits and approvals be obtained before construction and maintained during operation of facilities. The Company is obligated to comply with all environmental laws and regulations applicable within each jurisdiction and required to implement environmental programs and procedures to monitor and control risks associated with the construction, operation and decommissioning of regulated or permitted energy assets. Federal, state and local environmental laws have historically become more stringent over time, although this trend could change in the future.
Current wording
The Company is subject to a wide range of environmental laws during the development, construction, ownership and operation of facilities. These existing and future laws generally require that governmental permits and approvals be obtained before construction and maintained during operation of facilities. The Company is obligated to comply with all environmental laws and regulations applicable within each jurisdiction and required to implement environmental programs and procedures to monitor and control risks associated with the construction, operation and decommissioning of regulated or permitted energy assets. Federal, state and local environmental laws have historically become more stringent over time, although this trend has recently shifted at the federal level.
Previous wording
The following disclosures about the Company’s regulatory matters provide an update to, and should be read in conjunction with, Item 1, Business—Regulatory Matters and Item 1A, Risk Factors, of the Company’s 2024 Form 10-K.
Current wording
The Company’s regulatory matters are described in Item 1, Business—Regulatory Matters and Item 1A, Risk Factors, of the Company’s 2025 Form 10-K.
Previous wording
Operating revenues increased by $4 million during the nine months ended September 30, 2025, compared to the same period in 2024, due to a combination of the drivers summarized in the table below:
Current wording
Operating revenues increased by $56 million during the three months ended March 31, 2026, compared to the same period in 2025, due to a combination of the drivers summarized in the table below:
Previous wording
Interest expense decreased by $41 million during the three months ended September 30, 2025, compared to the same period in 2024, primarily due to the change in fair value of interest rate swaps due to changes in interest rates.
Current wording
Interest expense decreased by $15 million during the three months ended March 31, 2026, compared to the same period in 2025, primarily due to the following:
Previous wording
For the three months ended September 30, 2025, the Company recorded an income tax benefit of $31 million on pretax income of $29 million. For the same period in 2024, the Company recorded an income tax expense of $33 million on pretax income of $60 million. The $64 million decrease in income tax expense during the three months ended September 30, 2025, compared to the same period in 2024, was primarily due to the allocation of taxable earnings and losses, which includes the effect of applying the HLBV method of accounting for book purposes for certain partnerships.
Current wording
For the three months ended March 31, 2026, the Company recorded an income tax benefit of $2 million on a pretax loss of $70 million. For the same period in 2025, the Company recorded an immaterial income tax expense on a pretax loss of $104 million. The $2 million increase in income tax benefit during the three months ended March 31, 2026, compared to the same period in 2025, was primarily due to the allocation of taxable earnings and losses, which includes the effect of applying the HLBV method of accounting for book purposes for certain partnerships.
Previous wording
As of September 30, 2025 and December 31, 2024, the Company’s liquidity was approximately $834 million and $1,330 million, respectively, comprised of cash, restricted cash and availability under the Company’s revolving credit facility.
Current wording
As of March 31, 2026 and December 31, 2025, the Company’s liquidity was approximately $1,229 million and$1,061 million, respectively, comprised of cash, restricted cash and availability under the Company’s revolving credit facility.
Previous wording
The Company’s liquidity includes $390 million and $401 million of restricted cash balances as of September 30, 2025 and December 31, 2024, respectively. Restricted cash consists primarily of funds to satisfy the requirements of certain debt arrangements and funds held within the Company’s facilities that are restricted in their use. As of September 30, 2025, these restricted funds were comprised of $185 million designated to fund operating expenses, approximately $79 million designated for current debt service payments and $84 million restricted for reserves including debt service, performance obligations and other reserves, as well as capital expenditures. The remaining $42 million is held in distribution reserve accounts.
Current wording
The Company’s liquidity includes $355 million and $587 million of restricted cash balances as of March 31, 2026 and December 31, 2025, respectively. Restricted cash consists primarily of funds to satisfy the requirements of certain debt arrangements and funds held within the Company’s facilities that are restricted in their use. As of March 31, 2026, these restricted funds were comprised of $141 million designated to fund operating expenses, approximately $97 million designated for current debt service payments and $85 million restricted for reserves including debt service, performance obligations and other reserves, as well as capital expenditures. The remaining $32 million is held in distribution reserve accounts. In January 2026, the Company distributed $174 million to the tax equity investor in Rosie South TE Holdco LLC related to transferable ITCs for the Rosamond South I solar and BESS facility that were included in restricted cash as of December 31, 2025.
Previous wording
As of September 30, 2025, the Company had $405 million in outstanding borrowings under the revolving credit facility and $102 million in letters of credit outstanding. During October 2025, the Company repaid $190 million of the outstanding borrowings under the revolving credit facility primarily utilizing the proceeds received from the sale of Mt. Storm to Clearway Renew, as further discussed in Note 3, Acquisitions and Dispositions. As of October 31, 2025, the Company had $215 million in outstanding borrowings under the revolving credit facility. The facility will continue to be used for general corporate purposes including financing of future investments or acquisitions and posting letters of credit.
Current wording
As of March 31, 2026, the Company had no outstanding borrowings under the revolving credit facility and $151 million in letters of credit outstanding. During January 2026, the Company repaid all of the outstanding borrowings under the revolving credit facility utilizing the proceeds from the sale of the 2034 Senior Notes. The facility will continue to be used for general corporate purposes including financing of future investments or acquisitions and posting letters of credit.
Previous wording
Management believes that the Company’s liquidity position, cash flows from operations and availability under its revolving credit facility will be adequate to meet the Company’s financial commitments; debt service obligations; growth, operating and maintenance capital expenditures; and to fund dividends to holders of the Company’s Class A common stock and Class C common stock. Management continues to regularly monitor the Company’s ability to finance the needs of its operating, financing and investing activity within the dictates of prudent balance sheet management.
Current wording
Management believes that the Company’s liquidity position, cash flows from operations and availability under its revolving credit facility will be adequate to meet the Company’s financial commitments; debt service obligations; growth, operating and maintenance capital expenditures; and to fund dividends to holders of the Company’s Class C common stock. Management continues to regularly monitor the Company’s ability to finance the needs of its operating, financing and investing activities within the dictates of prudent balance sheet management.
Previous wording
The Company’s principal sources of liquidity include cash on hand, cash generated from operations, proceeds from sales of assets, borrowings under new and existing financing arrangements, and the issuance of additional equity and debt securities as appropriate given market conditions. As described in Note 7, Long-term Debt, to this Form 10-Q, Item 15 — Note 10, Long-term Debt, to the consolidated financial statements included in the Company’s 2024 Form 10-K, and further below, the Company’s financing arrangements consist of corporate level debt, which includes Senior Notes and the revolving credit facility, facility-level financings for its various assets, the ATM Program and the DSPP.
Current wording
The Company’s principal sources of liquidity include cash on hand, cash generated from operations, proceeds from sales of assets, borrowings under new and existing financing arrangements, and the issuance of additional equity and debt securities as appropriate given market conditions. As described in Note 7, Long-term Debt, and Note 9, Changes in Capital Structure, to this Form 10-Q, and Item 15 — Note 10, Long-term Debt, and Note 12, Stockholders’ Equity, to the consolidated financial statements included in the Company’s 2025 Form 10-K, and further below, the Company’s financing arrangements consist of corporate-level debt, which includes Senior Notes and the revolving credit facility; facility-level financings for its various assets; the ATM Program and the DSPP.
Previous wording
Dividend Reinvestment and Direct Stock Purchase Plan — On August 6, 2025, the Company adopted a dividend reinvestment and direct stock purchase plan, or DRIP/DSPP, respectively, under which the Company registered and reserved for issuance up to an aggregate of 3,300,000 shares of Class C common stock. Under the DRIP, holders of the Company’s Class C common stockholders can designate all or a portion of their cash dividends, when paid, to be reinvested in additional shares of the Company’s Class C common stock. The DSPP allows (i) plan participants and registered stockholders of the Company who are not plan participants to purchase shares of Class C common stock in the minimum amount of $50 per investment up to a maximum aggregate amount of $150,000 per calendar year; (ii) new investors who do not own shares of Class C common stock to purchase shares by making an initial minimum investment of $250, up to a maximum aggregate amount of $150,000 per calendar year; and (iii) plan participants, other registered stockholders and new investors to request a waiver from the Company to make optional cash investments in excess of the maximum aggregate amount of $150,000 per calendar year. During the third quarter of 2025, no shares were issued under the DSPP. During October 2025, the Company issued 793,202 shares of Class C common stock under the DSPP for gross proceeds of $25 million and incurred fees of less than $1 million. The Company intends to use the net proceeds from the sale of shares under the DRIP/DSPP for general corporate purposes, which may include the repayment or refinancing of indebtedness and the funding of working capital, capital expenditures, acquisitions and investments, and the Company may invest funds not required immediately for such purposes in marketable securities and short-term investments.
Current wording
Direct Stock Purchase Plan, or DSPP — In January 2026, the Company issued 1,445,244 shares of Class C common stock under the DSPP for gross proceeds of $50 million and incurred fees of less than $1 million, which were exchanged for 1,445,244 Class C units of Clearway Energy LLC. As of March 31, 2026, 1,061,554 shares of Class C common stock remained available for issuance under the DSPP.
Previous wording
The Company’s requirements for liquidity and capital resources, other than for operating its facilities, are categorized as: (i) debt service obligations, as described more fully in Note 7, Long-term Debt; (ii) capital expenditures; (iii) off-balance sheet arrangements; (iv) acquisitions and investments, as described more fully in Note 3, Acquisitions and Dispositions; and (v) cash dividends to investors.
Current wording
The Company’s requirements for liquidity and capital resources, other than for operating its facilities, are categorized as: (i) debt service obligations, as described more fully in Note 7, Long-term Debt; (ii) capital expenditures; (iii) off-balance sheet arrangements; (iv) acquisitions and investments, as described more fully in Note 3, Acquisitions, Note 7, Long-term Debt, and Note 9, Changes in Capital Structure; and (v) cash dividends to investors.
Previous wording
For the nine months ended September 30, 2025, the Company used approximately $213 million to fund capital expenditures, including growth expenditures of $202 million, primarily in the Renewables & Storage segment, funded through construction-related financing. Growth capital expenditures included $65 million incurred in connection with the Rosamond South I solar and BESS facility, $37 million incurred in connection with the Pine Forest solar and BESS facility, $29 million incurred in connection with the Dan’s Mountain wind facility, $22 million incurred in connection with the Luna Valley solar facility, $19 million incurred in connection with the repowering of the Cedro Hill wind facility, $12 million incurred in connection with the Victory Pass and Arica solar and BESS facilities, $12 million incurred in connection with the Daggett 1 BESS facility and $6 million incurred by other facilities. In addition, the Company incurred$11 million of maintenance capital expenditures, which is net of credits received from equipment manufacturers.
Current wording
For the three months ended March 31, 2026, the Company used approximately $75 million to fund capital expenditures, including growth expenditures of $70 million, primarily in the Renewables & Storage segment, funded through construction-related financing. Growth capital expenditures included $29 million incurred in connection with the Honeycomb Portfolio BESS facilities, $22 million incurred in connection with the Pine Forest solar and BESS facility, $17 million incurred in connection with the repowering of the Goat Mountain wind facility and $2 million incurred by other facilities. In addition, the Company incurred$5 million of maintenance capital expenditures.
Previous wording
Variable interest in equity investments — As of September 30, 2025, the Company has several investments with an ownership interest percentage of 50% or less. GenConn is a VIE for which the Company is not the primary beneficiary. The Company’s pro-rata share of non-recourse debt held by unconsolidated affiliates was approximately $268 million as of September 30, 2025. This indebtedness may restrict the ability of these subsidiaries to issue dividends or distributions to the Company.
Current wording
Variable interest in equity investments — As of March 31, 2026, the Company has several investments with an ownership interest percentage of 50% or less. GenConn is a VIE for which the Company is not the primary beneficiary. The Company’s pro-rata share of non-recourse debt held by unconsolidated affiliates was approximately $367 million as of March 31, 2026. This indebtedness may restrict the ability of these subsidiaries to issue dividends or distributions to the Company.
Previous wording
Dan’s Mountain Drop Down— On May 21, 2025, when the Dan’s Mountain wind facility reached substantial completion, the Company paid $36 million to Clearway Renew as additional purchase price in connection with the Company’s acquisition of the Class A membership interests in Dan’s Mountain TargetCo on November 18, 2024, which was funded with existing sources of liquidity. Also on May 21, 2025, a third-party cash equity investor contributed $45 million to acquire the Class B membership interests in Dan’s Mountain TargetCo from Clearway Renew and the tax equity investor contributed an additional $90 million. The Company utilized the combined proceeds from the cash equity and tax equity investors, along with the Company’s entire additional purchase price, which was contributed back to the Company by CEG, and the $18 million previously held in escrow, to repay the tax equity bridge loan, to repay the cash equity bridge loan and to pay associated fees with the remaining proceeds distributed to CEG. Prior to substantial completion being reached, the Company borrowed an additional $18 million in construction loans during 2025. The Company’s total capital investment in Dan’s Mountain TargetCo was $43 million.
Current wording
Honeycomb Portfolio Drop Down— On May 1, 2026, when the Honeycomb Portfolio BESS facilities reached substantial completion, the Company paid $81 million to Clearway Renew as additional purchase price in connection with the Company’s acquisition of Honeycomb TargetCo from Clearway Renew on October 15, 2025, which was funded with existing sources of liquidity. The Company’s total capital investment in Honeycomb TargetCo was $97 million. Also, on May 1, 2026, the tax equity investor in Honeycomb TE Holdco LLC contributed an additional $254 million, which was utilized along with the $60 million previously held in escrow, to repay the tax equity bridge loan and to pay associated fees with the remaining proceeds distributed to CEG. During 2026, the Company borrowed an additional $71 million in construction loans, and on May 1, 2026, the total outstanding construction loans were converted to a term loan.
Previous wording
Net Loss Attributable to Noncontrolling Interests and Redeemable Noncontrolling Interests
Current wording
Since the Company holds the Class A membership interests in Pine Forest TE HoldCo LLC through its ownership of Pine Forest TE Class A, net loss attributable to Clearway Energy, Inc. reflects HLBV allocations associated with Pine Forest’s tax attributes, including ITCs and accelerated tax depreciation. As a result, larger losses were allocated to the Company in the first quarter of 2026 relative to other partnerships and will continue to be allocated to the Company during the early stages of the facility’s operations. These losses are non-cash in nature and do not impact the Company’s liquidity.
Previous wording
The Company intends to use the amount of cash that it receives from its distributions from Clearway Energy LLC to pay quarterly dividends to the holders of its Class A common stock and Class C common stock. Clearway Energy LLC intends to distribute to its unit holders in the form of a quarterly distribution all of the CAFD that is generated each quarter, less reserves for the prudent conduct of the business. Dividends on the Class A common stock and Class C common stock are subject to available capital, market conditions and compliance with associated laws, regulations and other contractual obligations. The Company expects that, based on current circumstances, comparable cash dividends will continue to be paid in the foreseeable future.
Current wording
The Company intends to use the amount of cash that it receives from its distributions from Clearway Energy LLC to pay quarterly dividends to the holders of its Class C common stock. Clearway Energy LLC intends to distribute to its unit holders in the form of a quarterly distribution all of the CAFD that is generated each quarter, less reserves for the prudent conduct of the business. Dividends on the Class C common stock are subject to available capital, market conditions and compliance with associated laws, regulations and other contractual obligations. The Company expects that, based on current circumstances, comparable cash dividends will continue to be paid in the foreseeable future.
Previous wording
The following table lists the dividends paid on the Company’s Class A common stock and Class C common stock during the nine months ended September 30, 2025:
Current wording
The following table lists the dividends paid on the Company’s Class A common stock and Class C common stock during the three months ended March 31, 2026:
Previous wording
On November 3, 2025, the Company declared quarterly dividends on its Class A and Class C common stock of $0.4528 per share payable on December 15, 2025 to stockholders of record as of December 1, 2025.
Current wording
On May 6, 2026, the Company declared quarterly dividends on its Class C common stock, including shares that were received in the Class A Conversion, of $0.4676 per share payable on June 15, 2026 to stockholders of record as of June 1, 2026.
Previous wording
Net Cash Provided by (Used in) Financing Activities
Current wording
Net Cash Used in Financing Activities
Previous wording
As of December 31, 2024, the Company had a cumulative federal NOL carryforward balance of $278 million for financial statement purposes, none of which were subject to expiration. Additionally, as of December 31, 2024, the Company had a cumulative state NOL carryforward balance of $99 million for financial statement purposes, which will expire between 2025 and 2041 if unutilized. The Company does not anticipate material income tax payments through 2026. In addition, as of December 31, 2024, the Company had PTC and ITC carryforward balances totaling $23 million, which will expire between 2035 and 2044 if unutilized.
Current wording
As of December 31, 2025, the Company had a cumulative federal NOL carryforward balance of $212 million for financial statement purposes, none of which were subject to expiration. Additionally, as of December 31, 2025, the Company had a cumulative state NOL carryforward balance of $100 million for financial statement purposes, which will expire between 2026 and 2042 if unutilized. The Company does not anticipate material income tax payments through 2030. In addition, as of December 31, 2025, the Company had PTC and ITC carryforward balances totaling $18 million, which will expire between 2036 and 2045 if unutilized.
Previous wording
As of December 31, 2024, the Company had an interest disallowance carryforward of $82 million as a result of Internal Revenue Code §163(j). The disallowed interest deduction has an indefinite carryforward period and any limitations on the utilization of this carryforward have been factored into the Company’s valuation allowance analysis.
Current wording
As of December 31, 2025, the Company had an interest disallowance carryforward of $107 million as a result of Internal Revenue Code §163(j). The disallowed interest deduction has an indefinite carryforward period and any limitations on the utilization of this carryforward have been factored into the Company’s valuation allowance analysis.
Previous wording
The Company, after the utilization of various federal and state NOL carryforwards, paid $1 million in federal and state income taxes during the nine months ended September 30, 2025 and does not expect to pay material federal or state income taxes for the remainder of the current year. The Company does not anticipate being subject to the 15% corporate minimum tax on financial statement income.
Current wording
The Company, after the utilization of various federal and state NOL carryforwards, paid an immaterial amount of federal and state income taxes during the three months ended March 31, 2026 and does not expect to pay material federal or state income taxes for the remainder of the current year. The Company does not anticipate being subject to the corporate minimum tax on financial statement income.
Previous wording
Federal tax legislation enacted on July 4, 2025 contains a number of revisions to the Internal Revenue Code, including adjustments to the business interest expense disallowance calculation, accelerated tax depreciation and business tax credits and incentives for the development of clean energy facilities and production of clean energy, including wind, solar and BESS facilities. The Company is evaluating the potential impact of this legislation and does not anticipate the foregoing tax provisions will have a material impact on its consolidated financial statements. The Company will continue to monitor for guidance issued by the United States Department of the Treasury to assess for potential impact on its consolidated financial statements.
Current wording
Federal tax legislation enacted on July 4, 2025 contains a number of revisions to the Internal Revenue Code, including adjustments to the business interest expense disallowance calculation, accelerated tax depreciation and business tax credits and incentives for the development of clean energy facilities and production of clean energy, including wind, solar and BESS facilities. These changes did not have a material impact on the Company’s consolidated financial statements and the Company does not anticipate that these changes will have an adverse impact either (i) on the anticipated pipeline of facilities being developed by the Company’s sponsor, CEG, through at least 2030 or (ii) on the operation of facilities owned and operated by the Company. The Company will continue to monitor future guidance issued by the United States Department of the Treasury to assess for potential impacts on its consolidated financial statements.
Previous wording
The Company is subject to examination by taxing authorities for income tax returns filed in the U.S. federal and various state jurisdictions. All tax returns filed by the Company for the year ended December 31, 2013 and forward remain subject to audit. As of December 31, 2024, the U.S. federal partnership returns of three of the Company’s subsidiaries are under audit by the IRS. The IRS has issued proposed adjustments with respect to all three of the subsidiaries under audit. The Company believes that such proposed adjustments are without merit and in any case would not impact the Company’s tax liability or the tax liability of such subsidiary. The Company believes that the ultimate resolution of each of these audits will not be material to the Company’s financial condition, results of operations or liquidity, and thus no material provision has been made for any adjustments that may result from tax examinations. The outcome of tax audits cannot be predicted with certainty and if any issues addressed in tax audits of the Company are resolved in a manner inconsistent with its expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs.
Current wording
The Company is subject to examination by taxing authorities for income tax returns filed in the U.S. federal and various state jurisdictions. All tax returns filed by the Company for the year ended December 31, 2013 and forward remain subject to audit. As of December 31, 2025, the U.S. federal partnership returns of two of the Company’s subsidiaries are under audit by the IRS. The Company and its subsidiaries are also periodically subject to various state tax audits, including one current audit as a result of filing an amended return in order to pursue a potential California tax refund. The IRS has not yet issued any proposed adjustments with respect to the two subsidiaries under audit. The Company believes that the ultimate resolution of each of these audits will not be material to the Company’s financial condition, results of operations or liquidity, and thus no material provision has been made for any adjustments that may result from tax examinations. The outcome of tax audits cannot be predicted with certainty and if any issues addressed in tax audits of the Company are resolved in a manner inconsistent with its expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
Management’s Discussion of the Results of Operations for the Nine Months Ended September 30, 2025 and 2024
Previous report — wording carried elsewhere
For the nine months ended September 30, 2025, the Company recorded an income tax benefit of $26 million on a pretax loss of $58 million. For the same period in 2024, the Company recorded an income tax expense of $30 million on pretax income of $15 million. The $56 million decrease in income tax expense during the nine months ended September 30, 2025, compared to the same period in 2024, was primarily due to the allocation of taxable earnings and losses, which includes the effect of applying the HLBV method of accounting for book purposes for certain partnerships.
Previous report — wording carried elsewhere
Net Loss Attributable to Noncontrolling Interests and Redeemable Noncontrolling Interests