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SEC Filings
10-K
TERRAFORM POWER, INC. filed this Form 10-K on 03/07/2018
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6. RENEWABLE ENERGY FACILITIES

Renewable energy facilities, net consists of the following: 
 
 
As of December 31,
(In thousands)
 
2017
 
2016
Renewable energy facilities in service, at cost
 
$
5,378,462

 
$
5,354,883

Less accumulated depreciation - renewable energy facilities
 
(578,474
)
 
(364,756
)
Renewable energy facilities in service, net
 
4,799,988

 
4,990,127

Construction in progress - renewable energy facilities
 
1,937

 
3,124

Total renewable energy facilities, net
 
$
4,801,925

 
$
4,993,251


Depreciation expense related to renewable energy facilities was $212.6 million, $209.2 million and $135.7 million for the years ended December 31, 2017, 2016 and 2015, respectively.

As of December 31, 2017, construction in progress primarily represented initial costs incurred for the construction of a new battery energy storage system for one of the Company's wind power plants, for which construction began in the fourth quarter of 2017. As of December 31, 2016, construction in progress represented costs incurred to complete the construction of the facilities in the Company's portfolio that were acquired from SunEdison and is stated at SunEdison's historical cost. Construction in progress amounts include capitalized interest costs and amortization of deferred financing costs incurred during the asset's construction period when funds are borrowed to finance construction, which totaled $1.6 million and $22.7 million during the years ended December 31, 2016 and 2015, respectively. There was no capitalization of interest costs or deferred financing cost amortization for the year ended December 31, 2017.

As of December 31, 2016, the Company reclassified $548.7 million from renewable energy facilities, net to non-current assets held for sale in the consolidated balance sheet. There was no similar reclassification as of December 31, 2017 as the sale of these renewable energy facilities closed in the first half of 2017 (see Note 4. Assets held for Sale).

7. ASSET RETIREMENT OBLIGATIONS

Activity in asset retirement obligations for the years ended December 31, 2017, 2016 and 2015 was as follows:
 
 
Year Ended December 31,
(In thousands)
 
2017
 
2016
 
2015
Balance as of the beginning of the year
 
$
148,575

 
$
215,146

 
$
78,175

Additional obligations from renewable energy facilities achieving commercial
operation
 

 
2,132

 
52,181

Revisions in estimates for current obligations1
 

 
(7,920
)
 

Adjustment related to change in accretion period2
 

 
(22,204
)
 

Assumed through acquisition
 

 
136

 
74,293

Acquisition accounting adjustments related to prior year acquisitions
 

 

 
5,640

Accretion expense
 
8,578

 
8,992

 
7,209

Reclassification to non-current liabilities related to assets held for sale
 

 
(39,850
)
 

Other
 
(3,238
)
 

 

Currency translation adjustment
 
600

 
(7,857
)
 
(2,352
)
Balance as of the end of the year
 
$
154,515

 
$
148,575

 
$
215,146

————
(1)
As discussed in Note 2. Summary of Significant Accounting Policies, effective December 31, 2016, the Company revised its original estimates of the costs and related amount of cash flows for certain of its asset retirement obligations.
(2)
As discussed in Note 2. Summary of Significant Accounting Policies, during the fourth quarter of 2016, the Company revised the accretion period for its asset retirement obligations from the term of the related PPA agreement to the remaining useful life of the


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