Company announces financial results and historic operational expansion in 2022
- Greenbacker turned on largest operational project in Company history.
- Fleet added over 50 assets, representing nearly 500 MW, as it entered new market segment and geographies.
- Company’s best power generation year ever marked nearly 60% year-over-year production increase.
- Company’s newly defined business segments built additional foundations for future growth.
- Operating revenue of $111 million in Partial Year Period was driven by substantial energy revenue.
- Nearly $350 million capital raised in investment vehicles managed by GCM; AUM surpassed $3.0 billion.
- Company’s investments abate carbon emissions, conserve water, and support green jobs.
New York, NY, April 3, 2023 — Greenbacker Renewable Energy Company LLC (“Greenbacker,” “GREC,” or the “Company”), an independent power producer and a leading climate-focused investment manager, has announced financial results1 for 2022, as well as historic year-over-year expansion that included the Company’s largest operational clean energy project to date and its first projects in a new segment of the fast-growing battery storage market.
Greenbacker turned on largest operational project in Company history
Greenbacker surpassed a new milestone in the year, bringing online the largest operational renewable energy project in Company history: the 104 MWdc / 80 MWac Graphite Solar.
The project reached commercial operation in June and now produces clean energy that is sold via long-term power purchase agreement (“PPA”) to an investment-grade utility. On an annual basis, Graphite is expected to generate about 223 million kilowatt-hours of clean power—enough to offset carbon emissions equivalent to burning approximately 175 million pounds of coal.2
In addition to the local green jobs and over 273,000 construction labor hours the project supported, Greenbacker and its project partners have also invested in the Utah community that hosts Graphite with a scholarship program providing $75,000 to area students who plan to pursue their career goals locally after completing their education.
Greenbacker’s largest operating renewables project to date
Fleet added over 50 assets, representing nearly 500 MW, as it entered new market segment and geographies
Greenbacker’s clean energy project count (owned and managed) increased by 52 assets during 2022, representing approximately 500 MW of additional total clean energy–generating capacity, and growing the Company’s total project count to 456.3
With this growth, Greenbacker expanded its solar and wind energy presence into new territories, increasing the geographical footprint and diversification of its fleet. This included its first solar farm in Virginia, acquired through an affiliated investment vehicle, and its first wind energy project in Illinois—the 54 MWdc Panther Creek wind farm, which is now Greenbacker’s largest wind asset in the Midwestern region.
The Company also expanded its operational standalone battery storage portfolio to include its first pre-operational storage assets, with a pair of energy storage projects in New York City. As of the end of the year, Greenbacker was conducting business in 33 states, Canada, Puerto Rico, and Washington, DC.
Company’s best power generation year ever marked nearly 60% year-over-year production increase
Over the course of 2022, the power-production capacity of Greenbacker’s operating fleet of renewable energy projects increased by 178 MW, a year-over-year increase of 17%, as the Company moved under-construction projects into commercial operation and acquired new operational projects.
With this capacity growth, the Company’s fleet produced nearly 2.4 million megawatt-hours (“MWh”) of total clean energy during the year, a year-over-year increase of almost 60%. GREC’s total power production in 2022 nearly equaled the amount it generated over the previous two years combined (almost 2.5 million MWh).
This highlights Greenbacker’s considerable growth trend in recent years, given that both 2021 and 2020 were themselves periods of substantial power production increases. In 2021, the Company generated upwards of 1.4 million MWh of clean energy, following production of over 999,000 MWh in 2020, representing year-over-year increases of 49% and 61%, respectively.
The table below summarizes Greenbacker’s 2022 year-over-year operational portfolio expansion.
|GREC Portfolio Metrics*
|December 31, 2022
|December 31, 2021
|YoY Increase (total)
|YoY increase (%)
|Power-production capacity of operating fleet at end of period
|Power-generating capacity of pre-operational fleet at end of period
|Total power-generating capacity of fleet at end of period
|YTD total energy produced at end of period (MWh)
|Total number of fleet assets at end of period
Company’s newly defined business segments built additional foundations for future growth
As a result of Greenbacker’s acquisition of Greenbacker Capital Management LLC (“GCM”) and certain other affiliated companies, the Company shifted the basis of its historical accounting and the underlying presentation of its financial results from investment company accounting to non-investment company accounting.
Since this transition occurred during the Company’s second fiscal quarter and was prospective in nature, the 2022 financial results reflected in this press release are for performance under non-investment company accounting during the period beginning May 19, 2022 and ended December 31, 2022 (“the Partial Year Period”).
For the Partial Year Period, Greenbacker has presented financial information for its Independent Power Producer (“IPP”) and Investment Management (“IM”) business segments.
Charles Wheeler, CEO of Greenbacker, said:
“Our fleet had its best year of production in Company history, even as we paved the way for additional future growth and financial returns. Greenbacker’s decision to acquire GCM has opened the potential to generate significant long-term value for our shareholders, allowing us to diversify our business to capitalize on exciting opportunities in the energy transition asset class both today and in the years to come.”
Operating revenue of $111 million in Partial Year Period was driven by substantial energy revenue
Greenbacker generated total operating revenue of $111.0 million, primarily from energy revenue within the IPP segment, for the Partial Year Period. Energy revenue was $101.6 million and included $83.6 million from our long-term PPAs.
With respect to PPA revenue, the Company’s operating solar fleet, which included 285 operating assets comprising 834 MW of capacity, generated $39.6 million from nearly 1.1 million MWh of production. GREC’s operating wind fleet, which included 16 operating projects comprising 386 MW of capacity, generated $39.2 million from just under 1.2 million MWh of production.
Adjusted EBITDA was $26.4 million for the Partial Year Period, largely driven by Adjusted EBITDA within the IPP segment of $53.6 million. Direct operating costs associated with capital raise efforts for certain of IM’s managed funds in their early stages and corporate expenses offset IPP results. The net loss attributable to Greenbacker was approximately $0.7 million.
Funds From Operations (“FFO”) was $3.2 million for the period and represents the $26.4 million of Adjusted EBITDA less cash interest expense and distributions to our tax equity investors.
|For the period from May 19, 2022 through December 31, 2022
|Select Financial Information
|Total operating revenue*
|Net income (loss) attributable to Greenbacker
|Funds From Operations†
*Total operating revenue excludes non-cash contract amortization, net.
†See “Non-GAAP Financial Measures” for additional discussion. These financial metrics are unaudited.
Nearly $350 million capital raised in investment vehicles managed by GCM; AUM surpassed $3.0 billion
Greenbacker’s IM segment experienced considerable momentum in its initiatives to raise additional capital from retail and institutional investors in 2022. Between May 19, 2022 and December 31, 2022, the IM business segment raised $348.5 million of new equity capital, on which GCM is entitled to collect management fees, boosting AUM4 to over $3.0 billion at the end of the period.
As of December 31, 2022, GCM served as the investment manager to four climate-focused funds.
Greenbacker’s renewable energy investment activities continued to deliver on ESG metrics. As of December 31, 2022, the Company’s renewable energy assets had cumulatively generated over 6.1 million MWh of clean power, abating more than 4.3 million metric tons of carbon since January 2016.5
The Company’s clean energy projects have saved nearly 4.1 billion gallons of water,6 compared to the amount of water needed to produce the same amount of power by burning coal, and its business activities will sustain more than 5,200 green jobs.7
David Sher, Director of Greenbacker, said:
“We believe market conditions will remain favorable to our investment strategy, especially given the inherent resiliency of our assets and the policy catalysts from the renewed focus on climate change at the federal and state levels, as well as decarbonization commitments from large corporations and utilities.”
The resilient nature of Greenbacker’s infrastructure assets—e.g., stable long-term cashflows, high-credit-quality counterparties, and inelastic demand—can offer investors the opportunity for both diversification and insulation from short-term volatility, while meeting long-term growth objectives.
This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results to differ materially from those anticipated at the time the forward-looking statements are made. Although Greenbacker believes the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that the expectations will be attained or that any deviation will not be material. Greenbacker undertakes no obligation to update any forward-looking statement contained herein to conform to actual results or changes in its expectations.
Non-GAAP Financial Measures
In addition to evaluating the Company’s performance on a U.S. GAAP basis, the Company now utilizes certain non-GAAP financial measures to analyze the operating performance of our segments as well as our consolidated business. Each of these measures should not be considered in isolation from or as superior to or as a substitute for other financial measures determined in accordance with U.S. GAAP, such as net income (loss) or operating income (loss). The Company uses these non-GAAP financial measures to supplement its U.S. GAAP results in order to provide a more complete understanding of the factors and trends affecting its operations.
Adjusted EBITDA is a non-GAAP financial measure that the Company uses as a performance measure, as well as for internal planning purposes. We believe that Adjusted EBITDA is useful to management and investors in providing a measure of core financial performance adjusted to allow for comparisons of results of operations across reporting periods on a consistent basis, as it includes adjustments relating to items that are not indicative on the ongoing operating performance of the business.
Adjusted EBITDA is a performance measure used by management that is not calculated in accordance with U.S. GAAP. Adjusted EBITDA should not be considered in isolation from or as superior to or as a substitute for net income (loss), operating income (loss) or any other measure of financial performance calculated in accordance with U.S. GAAP. Additionally, our calculation of Adjusted EBITDA may not be comparable to similarly titled measures reported by other companies.
Funds From Operations
FFO is a non-GAAP financial measure that the Company uses as a performance measure to analyze net earnings from operations without the effects of certain non-recurring items that are not indicative of the ongoing operating performance of the business. FFO is calculated using Adjusted EBITDA less the impact of interest expense (excluding the non-cash component) and distributions to tax equity investors under the financing facilities associated with our IPP segment.
The Company believes that the analysis and presentation of FFO will enhance our investor’s understanding of the ongoing performance of our operating business. The Company will consider FFO, in addition to other GAAP and non-GAAP measures, in assessing operating performance and as a proxy for growth in distribution coverage over the long term.
FFO should not be considered in isolation from or as a superior to or as a substitute for net income (loss), operating income (loss) or any other measure of financial performance calculated in accordance with U.S. GAAP.
This information has been prepared solely for informational purposes and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security, or to participate in any trading or investment strategy. The information presented herein may involve Greenbacker’s views, estimates, assumptions, facts, and information from other sources that are believed to be accurate and reliable and are, as of the date this information is presented, subject to change without notice.
The following table reconciles Net income (loss) attributable to Greenbacker Renewable Energy Company LLC to Adjusted EBITDA:
The Company defines Adjusted EBITDA as net income (loss) before: (i) interest expense; (ii) income taxes; (iii) depreciation expense; (iv) amortization expense (including contract amortization); (v) accretion; (vi) amounts attributable to our redeemable and non-redeemable noncontrolling interests; (vii) unrealized gains and losses on financial instruments; (viii) other income (loss); and (ix) foreign currency gain (loss). Additionally, the Company further adjusts for the following items described below:
- Share-based compensation is excluded from Adjusted EBITDA as it is different from other forms of compensation, as it is a non-cash expense and is highly variable. For example, a cash salary generally has a fixed and unvarying cash cost. In contrast, the expense associated with an equity-based award is generally unrelated to the amount of cash ultimately received by the employee, and the cost to the Company is based on a share-based compensation valuation methodology and underlying assumptions that may vary over time.
- The change in fair value of contingent consideration, which is related to the Acquisition, is excluded from Adjusted EBITDA, if any such change occurs during the period. The non-cash, mark-to-market adjustments are based on the expected achievement of revenue targets that are difficult to forecast and can be variable, making comparisons across historical and future quarters difficult to evaluate; and
- Other costs that are not consistently occurring, not reflective of expected future operating expense, and provide no insight into the fundamentals of current or past operations of our business are excluded from Adjusted EBITDA. This includes costs such as professional fees incurred as part of the Acquisition and the change in status and other non-recurring costs unrelated to the ongoing operations of the Company.
The Company uses Segment Adjusted EBITDA to evaluate the financial performance of and allocate resources among our operating segments. Segment Adjusted EBITDA is determined for our segments consistent with the adjustments noted above but further excludes unallocated corporate expenses as these items are centrally controlled and are not directly attributable to any reportable segment.
The following table reconciles total Segment Adjusted EBITDA to Net income (loss) attributable to Greenbacker Renewable Energy Company LLC:
Funds From Operations
The following table reconciles Net income (loss) attributable to Greenbacker Renewable Energy Company LLC to Adjusted EBITDA and then to FFO:
FFO is a non-GAAP financial measure that the Company uses as a performance measure to analyze net earnings from operations without the effects of certain non-recurring items that are not indicative of the ongoing performance of the business.
FFO is calculated using Adjusted EBITDA less the impact of interest expense (excluding the non-cash component) and distributions to tax equity investors under the financing facilities associated with our IPP segment.
1 Past performance is not indicative of future results.
2 When compared with a similar amount of power generation from fossil fuels. Carbon abatement is calculated using the EPA Greenhouse Gas Equivalencies Calculator which uses the Avoided Emissions and generation Tool (AVERT) US national weighted average CO2 marginal emission rate to convert reductions of kilowatt-hours into avoided units of carbon dioxide emissions.
3 Total assets and megawatts statistics include those projects where the Company has contracted for the acquisition of the project pursuant to a Membership Interest Purchase Agreement (“MIPA”).
4 Total AUM includes GREC and GCM’s managed funds. AUM represents the underlying fair value of investments, determined generally in accordance with ASC 820, cash and cash equivalents and project level debt. These figures are unaudited and subject to change.
5 When compared with a similar amount of power generation from fossil fuels. Carbon abatement is calculated using the EPA Greenhouse Gas Equivalencies Calculator which uses the Avoided Emissions and generation Tool (AVERT) US national weighted average CO2 marginal emission rate to convert reductions of kilowatt-hours into avoided units of carbon dioxide emissions.
6 Gallons of water saved are calculated based on Operational water consumption and withdrawal factors for electricity generating technologies: a review of existing literature – IOPscience, J Macknick et al 2012 Environ. Res. Lett. 7 045802.