ENERGY STORAGE SYSTEMS, NET |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2026 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Property, Plant, and Equipment [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ENERGY STORAGE SYSTEMS, NET | ENERGY STORAGE SYSTEMS, NET Energy storage systems, net, consists of the following (in thousands):
Depreciation expense for energy storage systems was approximately $2.9 million and $3.1 million for the three months ended June 30, 2026 and 2025, respectively, and approximately $5.7 million and $6.3 million for the six months ended June 30, 2026 and 2025, respectively. Depreciation expense is recognized in cost of services and other. Impairment expense for energy storage systems was approximately $0.1 million and $1.4 million for the three months ended June 30, 2026 and 2025, respectively, and approximately $0.1 million and $1.4 million for the six months ended June 30, 2026 and 2025, respectively. Impairment expense is recognized in cost of services and other. On February 10, 2026, the Company, through an indirect consolidated subsidiary, Stem Finance SPV VI ULC, made the decision to sell Logan Energy Storage ULC (“Logan”), a wholly owned subsidiary. Logan owns and operates four battery energy storage system projects in Ontario, Canada. As of March 31, 2026, the Company determined that the four battery energy system projects were considered to be assets held for sale, since these assets were being marketed for sale and all the criteria to be classified as held for sale under ASC 360, Property, Plant and Equipment-Impairment or Disposal of Long-Lived Assets, had been met. Assets held for sale are measured at the lower of their carrying value or the fair value less cost to sell. During the three months ended March 31, 2026, the Company determined that the carrying value of the assets was less than the fair value and recognized an impairment of assets held for sale of approximately $3.3 million in the unaudited condensed consolidated statements of operations. As a result of the impairment, the carrying value of the assets was $1.4 million as of March 31, 2026. During three months ended June 30, 2026, the Company determined that one battery energy system project previously considered to be assets held for sale no longer met the criteria. As a result, $0.6 million was reclassified to energy storage systems, net on the condensed consolidated balance sheet as of June 30, 2026. The Company also recognized a $0.4 million gain on the assets that no longer met held for sale criteria and a $0.1 million remeasurement adjustment to the impairment of assets held for sale during the three months ended June 30, 2026. The Company expects to dispose of the remaining assets held for sale within one year.
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