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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2021
OR
  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ___________ to ___________.
Commission File Number: 001-34811
Ameresco, Inc.
(Exact name of registrant as specified in its charter)
Delaware   04-3512838
(State or Other Jurisdiction of
Incorporation or Organization)
  (I.R.S. Employer
Identification No.)
111 Speen Street, Suite 410
Framingham, Massachusetts
  01701
(Address of Principal Executive Offices)   (Zip Code)
(508) 661-2200
(Registrant’s Telephone Number, Including Area Code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer o
Accelerated Filer
Non-accelerated filer  o
Smaller reporting company ☐
Emerging growth company  ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Class
New York Stock Exchange Symbol
Shares outstanding as of July 30, 2021
Class A Common Stock, $0.0001 par value per share AMRC 33,388,508
Class B Common Stock, $0.0001 par value per share 18,000,000




TABLE OF CONTENTS
    Page
 
Item 1. Condensed Consolidated Financial Statements
 
1
3
4
5
7
9
     
 
 



Part I - Financial Information
Item 1. Condensed Consolidated Financial Statements

AMERESCO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts)
June 30, 2021 December 31, 2020
(Unaudited)
ASSETS
Current assets:  
Cash and cash equivalents (1)
$ 58,807  $ 66,422 
Restricted cash (1)
23,672  22,063 
Accounts receivable, net of allowance of $2,311 and $2,266, respectively (1)
115,462  125,010 
Accounts receivable retainage, net 36,485  30,189 
Costs and estimated earnings in excess of billings (1)
195,027  185,960 
Inventory, net 8,798  8,575 
Prepaid expenses and other current assets (1)
25,389  26,854 
Income tax receivable 5,688  9,803 
Project development costs 14,508  15,839 
Total current assets (1)
483,836  490,715 
Federal ESPC receivable 512,737  396,725 
Property and equipment, net (1)
8,826  8,982 
Energy assets, net (1)
798,609  729,378 
Deferred income tax assets, net 3,972  3,864 
Goodwill, net 58,901  58,714 
Intangible assets, net 769  927 
Operating lease assets (1)
40,608  39,151 
Restricted cash, non-current portion (1)
11,363  10,352 
Other assets (1)
19,069  15,307 
 Total assets (1)
$ 1,938,690  $ 1,754,115 
LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portions of long-term debt and financing lease liabilities (1)
$ 79,778  $ 69,362 
Accounts payable (1)
193,373  230,916 
Accrued expenses and other current liabilities (1)
40,108  41,748 
Current portions of operating lease liabilities (1)
5,995  6,106 
Billings in excess of cost and estimated earnings 26,561  33,984 
Income taxes payable —  981 
Total current liabilities (1)
345,815  383,097 
Long-term debt and financing lease liabilities, net of current portion, unamortized discount and debt issuance costs (1)
305,351  311,674 
Federal ESPC liabilities 506,680  440,223 
Deferred income taxes, net 7,159  6,227 
Deferred grant income 8,075  8,271 
Long-term operating lease liabilities, net of current portion (1)
36,731  35,300 
Other liabilities (1)
37,300  37,660 
Commitments and contingencies (Note 9)
Redeemable non-controlling interests, net 46,003  38,850 
(1) Includes restricted assets of consolidated variable interest entities (“VIEs”) at June 30, 2021 and December 31, 2020 of $155,878 and $162,198, respectively. Includes non-recourse liabilities of consolidated VIEs at June 30, 2021 and December 31, 2020 of $32,318 and $33,335, respectively. See Note 12.
1

AMERESCO, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share and per share amounts) (Continued)
June 30, 2021 December 31, 2020
(Unaudited)
Stockholders’ equity:
Preferred stock, $0.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding at June 30, 2021 and December 31, 2020
$ —  $ — 
Class A common stock, $0.0001 par value, 500,000,000 shares authorized, 35,484,126 shares issued and 33,382,331 shares outstanding at June 30, 2021, 32,326,449 shares issued and 30,224,654 shares outstanding at December 31, 2020
Class B common stock, $0.0001 par value, 144,000,000 shares authorized, 18,000,000 shares issued and outstanding at June 30, 2021 and December 31, 2020
Additional paid-in capital 270,955  145,496 
Retained earnings 393,158  368,390 
Accumulated other comprehensive loss, net (6,754) (9,290)
Treasury stock, at cost, 2,101,795 shares at June 30, 2021 and December 31, 2020
(11,788) (11,788)
Total stockholders’ equity 645,576  492,813 
Total liabilities, redeemable non-controlling interests and stockholders’ equity
$ 1,938,690  $ 1,754,115 

See notes to condensed consolidated financial statements.

2

AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except share amounts) (Unaudited)
  Three Months Ended June 30, Six Months Ended June 30,
  2021 2020 2021 2020
Revenues $ 273,920  $ 223,036  $ 526,122  $ 435,449 
Cost of revenues 220,598  183,528  425,891  357,495 
Gross profit 53,322  39,508  100,231  77,954 
Selling, general and administrative expenses 31,882  26,620  60,483  55,544 
Operating income 21,440  12,888  39,748  22,410 
Other expenses, net 5,450  4,052  9,122  9,441 
Income before income taxes 15,990  8,836  30,626  12,969 
Income tax (benefit) provision (1,896) —  309  (2,503)
Net income 17,886  8,836  30,317  15,472 
Net income attributable to redeemable non-controlling interests (4,231) (4,471) (5,488) (4,906)
Net income attributable to common shareholders $ 13,655  $ 4,365  $ 24,829  $ 10,566 
Net income per share attributable to common shareholders:  
Basic $ 0.27  $ 0.09  $ 0.49  $ 0.22 
Diluted $ 0.26  $ 0.09  $ 0.48  $ 0.22 
Weighted average common shares outstanding:    
Basic 51,315  47,488  50,158  47,500 
Diluted 52,570  48,519  51,475  48,571 

See notes to condensed consolidated financial statements.
3

AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(In thousands) (Unaudited)
  Three Months Ended June 30,
  2021 2020
Net income $ 17,886  $ 8,836 
Other comprehensive income (loss):
Unrealized loss from interest rate hedges, net of tax effect of $(188) and $(221)
(472) (585)
Foreign currency translation adjustments 477  682 
Total other comprehensive income 97 
Comprehensive income 17,891  8,933 
Comprehensive income attributable to redeemable non-controlling interests (4,231) (4,471)
Comprehensive income attributable to common shareholders $ 13,660  $ 4,462 
  Six Months Ended June 30,
  2021 2020
Net income $ 30,317  $ 15,472 
Other comprehensive income (loss):
Unrealized gain (loss) from interest rate hedges, net of tax effect of $531 and $(1,408)
1,645  (4,050)
Foreign currency translation adjustments 891  (1,630)
Total other comprehensive income (loss) 2,536  (5,680)
Comprehensive income 32,853  9,792 
Comprehensive income attributable to redeemable non-controlling interests (5,488) (4,906)
Comprehensive income attributable to common shareholders $ 27,365  $ 4,886 

See notes to condensed consolidated financial statements.
4

AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE NON-CONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY
For the Three Months Ended June 30, 2021 and 2020
(In thousands, except share amounts) (Unaudited)
Class A Common Stock Class B Common Stock Treasury Stock
Redeemable Non-controlling Interests Shares Amount Shares Amount Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Shares Amount Total Stockholders’ Equity
Balance, March 31, 2020 $ 31,939  29,510,161  $ 18,000,000  $ $ 136,591  $ 320,660  $ (13,291) 2,101,795  $ (11,788) $ 432,177 
Exercise of stock options —  179,639  —  —  —  2,164  —  —  —  —  2,164 
Stock-based compensation expense —  —  —  —  —  430  —  —  —  —  430 
Employee stock purchase plan —  28,302  —  —  —  440  —  —  —  —  440 
Unrealized loss from interest rate hedges, net —  —  —  —  —  —  —  (585) —  —  (585)
Foreign currency translation adjustment —  —  —  —  —  —  —  682  —  —  682 
Contributions from redeemable non-controlling interests 488  —  —  —  —  —  —  —  —  —  — 
Distributions to redeemable non-controlling interests (595) —  —  —  —  —  —  —  —  —  — 
Net income 4,471  —  —  —  —  —  4,365  —  —  —  4,365 
Balance, June 30, 2020 $ 36,303  29,718,102  $ 18,000,000  $ $ 139,625  $ 325,025  $ (13,194) 2,101,795  $ (11,788) $ 439,673 
Balance, March 31, 2021 $ 39,668  33,265,925  $ 18,000,000  $ $ 267,864  $ 379,533  $ (6,759) 2,101,795  $ (11,788) $ 628,855 
Equity offering costs —  —  —  —  —  (135) —  —  —  —  (135)
Exercise of stock options —  101,109  —  —  —  1,225  —  —  —  —  1,225 
Stock-based compensation expense —  —  —  —  —  1,349  —  —  —  —  1,349 
Employee stock purchase plan —  15,297  —  —  —  652  —  —  —  —  652 
Unrealized loss from interest rate hedges, net —  —  —  —  —  —  —  (472) —  —  (472)
Foreign currency translation adjustment —  —  —  —  —  —  —  477  —  —  477 
Contributions from redeemable non-controlling interests, net of tax equity financing fees 2,269  —  —  —  —  —  —  —  —  —  — 
Distributions to redeemable non-controlling interests (195) —  —  —  —  —  —  —  —  —  — 
Accretion of tax equity financing fees 30  —  —  —  —  —  (30) —  —  —  (30)
Net income 4,231  —  —  —  —  —  13,655  —  —  —  13,655 
Balance, June 30, 2021 $ 46,003  33,382,331  $ 18,000,000  $ $ 270,955  $ 393,158  $ (6,754) 2,101,795  $ (11,788) $ 645,576 

See notes to condensed consolidated financial statements.

5

AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE NON-CONTROLLING INTERESTS AND STOCKHOLDERS’ EQUITY
For the Six Months Ended June 30, 2021 and 2020
(In thousands, except share amounts) (Unaudited)
Class A Common Stock Class B Common Stock Treasury Stock
Redeemable Non-controlling Interests Shares Amount Shares Amount Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Loss Shares Amount Total Stockholders’ Equity
Balance, December 31, 2019
$ 31,616  29,230,005  $ 18,000,000  $ $ 133,688  $ 314,459  $ (7,514) 2,101,340  $ (11,782) $ 428,856 
Exercise of stock options —  460,250  —  —  —  4,638  —  —  —  —  4,638 
Stock-based compensation expense —  —  —  —  —  859  —  —  —  —  859 
Employee stock purchase plan —  28,302  —  —  —  440  —  —  —  —  440 
Open market purchase of common shares —  (455) —  —  —  —  —  —  455  (6) (6)
Unrealized loss from interest rate hedges, net —  —  —  —  —  —  —  (4,050) —  —  (4,050)
Foreign currency translation adjustment —  —  —  —  —  —  —  (1,630) —  —  (1,630)
Contributions from redeemable non-controlling interests 488  —  —  —  —  —  —  —  —  —  — 
Distributions to redeemable non-controlling interests (707) —  —  —  —  —  —  —  —  —  — 
Net income 4,906  —  —  —  —  —  10,566  —  —  —  10,566 
Balance, June 30, 2020
$ 36,303  29,718,102  $ 18,000,000  $ $ 139,625  $ 325,025  $ (13,194) 2,101,795  $ (11,788) $ 439,673 
Balance, December 31, 2020
$ 38,850  30,224,654  $ 18,000,000  $ $ 145,496  $ 368,390  $ (9,290) 2,101,795  $ (11,788) $ 492,813 
Equity offering of common stock, net of offering costs of $6,419
—  2,875,000  —  —  —  120,081  —  —  —  —  120,081 
Exercise of stock options —  267,380  —  —  —  2,611  —  —  —  —  2,611 
Stock-based compensation expense —  —  —  —  —  2,115  —  —  —  —  2,115 
Employee stock purchase plan —  15,297  —  —  —  652  —  —  —  —  652 
Unrealized gain from interest rate hedges, net —  —  —  —  —  —  —  1,645  —  —  1,645 
Foreign currency translation adjustment —  —  —  —  —  —  —  891  —  —  891 
Contributions from redeemable non-controlling interests, net of tax equity financing fees 2,252  —  —  —  —  —  —  —  —  —  — 
Distributions to redeemable non-controlling interests (648) —  —  —  —  —  —  —  —  —  — 
Accretion of tax equity financing fees 61  —  —  —  —  —  (61) —  —  —  (61)
Net income 5,488  —  —  —  —  —  24,829  —  —  —  24,829 
Balance, June 30, 2021
$ 46,003  33,382,331  $ 18,000,000  $ $ 270,955  $ 393,158  $ (6,754) 2,101,795  $ (11,788) $ 645,576 

See notes to condensed consolidated financial statements.
6

AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited)
  Six Months Ended June 30,
  2021 2020
Cash flows from operating activities:    
Net income $ 30,317  $ 15,472 
Adjustments to reconcile net income to cash flows from operating activities:
Depreciation of energy assets, net 20,136  18,949 
Depreciation of property and equipment 1,637  1,659 
Accretion of ARO liabilities 57  43 
Amortization of debt discount and debt issuance costs 1,477  1,176 
Amortization of intangible assets 161  356 
Provision for (recoveries of) bad debts (80)
Net loss from derivatives 1,225  517 
Stock-based compensation expense 2,115  859 
Deferred income taxes 335  4,619 
Unrealized foreign exchange (gain) loss (32) 201 
Changes in operating assets and liabilities:
Accounts receivable 15,230  12,125 
Accounts receivable retainage (6,211) (2,222)
Federal ESPC receivable (125,146) (89,761)
Inventory, net (224) 235 
Costs and estimated earnings in excess of billings (8,893) 6,410 
Prepaid expenses and other current assets 2,445  1,857 
Project development costs 760  (2,758)
Other assets (3,691) 516 
Accounts payable, accrued expenses and other current liabilities (22,941) (45,256)
Billings in excess of cost and estimated earnings (8,174) 8,569 
Other liabilities (207) 316 
Income taxes payable 3,135  (7,396)
Cash flows from operating activities
(96,483) (73,594)
Cash flows from investing activities:
Purchases of property and equipment (1,484) (1,355)
Capital investment in energy assets (104,267) (77,218)
Contributions to equity investment —  (127)
Cash flows from investing activities
(105,751) (78,700)
See notes to condensed consolidated financial statements.
7

AMERESCO, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited) (Continued)
Six Months Ended June 30,
2021 2020
Cash flows from financing activities:    
Proceeds from equity offering, net of offering costs $ 120,081  $ — 
Payments of financing fees (1,162) (2,198)
Proceeds from exercises of options and ESPP 3,263  5,078 
Repurchase of common stock —  (6)
(Payments on) proceeds from senior secured credit facility, net (28,073) 16,000 
Proceeds from long-term debt financings 64,854  14,232 
Proceeds from Federal ESPC projects 70,159  133,598 
(Payments on) proceeds for energy assets from Federal ESPC (117) 1,488 
Proceeds from redeemable non-controlling interests, net 1,583  74 
Payments on long-term debt (33,664) (25,860)
Cash flows from financing activities
196,924  142,406 
Effect of exchange rate changes on cash 315  (457)
Net decrease in cash, cash equivalents, and restricted cash (4,995) (10,345)
Cash, cash equivalents, and restricted cash, beginning of period 98,837  77,264 
Cash, cash equivalents, and restricted cash, end of period $ 93,842  $ 66,919 
Supplemental disclosures of cash flow information:
Cash paid for interest $ 9,097  $ 10,499 
Cash paid for income taxes $ 1,213  $ 382 
Non-cash Federal ESPC settlement $ 4,027  $ 43,368 
Accrued purchases of energy assets $ 28,070  $ 35,705 

See notes to condensed consolidated financial statements.
8

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited)


1. BASIS OF PRESENTATION
The accompanying condensed consolidated financial statements of Ameresco, Inc. (including its subsidiaries, the “Company,” “Ameresco,” “we,” “our,” or “us”) are unaudited, according to certain rules and regulations of the Securities and Exchange Commission, and include, in our opinion, normal recurring adjustments necessary for a fair presentation in conformity with accounting principles generally accepted in the United States (“GAAP”) of the results for the periods indicated.
The results of operations for the three and six months ended June 30, 2021 are not necessarily indicative of results which may be expected for the full year. The December 31, 2020 consolidated balance sheet data was derived from audited financial statements, but certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with GAAP have been condensed or omitted. The interim condensed consolidated financial statements and accompanying notes should be read in conjunction with the audited consolidated financial statements and accompanying notes for the year ended December 31, 2020, included in our annual report on Form 10-K (“2020 Annual Report” or “2020 Form 10-K”) for the year ended December 31, 2020 filed with the Securities and Exchange Commission on March 2, 2021.
Reclassification
Certain prior period amounts were reclassified to conform to the presentation in the current period.
Significant Risks and Uncertainties
We considered the impact of COVID-19 on the assumptions and estimates used and determined that there was no material adverse impact on our results of operations for the six months ended June 30, 2021 or 2020. Our results of future operations and liquidity could be adversely impacted by a number of factors associated with the COVID-19 pandemic, including payments of outstanding receivable amounts beyond normal payment terms, delays in obtaining signed customer contracts for awarded projects, supply chain disruptions and uncertain demand. As of the date of issuance of these condensed consolidated financial statements, the extent to which the COVID-19 pandemic may impact our financial condition, liquidity, or results of operations in the future is uncertain.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Our accounting policies are set forth in Note 2 to the consolidated financial statements contained in our 2020 Form 10-K. We have included certain updates to those policies below.
Accounts Receivable and Allowance for Credit Losses
Changes in the allowance for credit losses are as follows:
June 30, 2021 June 30, 2020
Allowance for credit losses, beginning of period $ 2,266  $ 2,260 
Charges (recoveries) to costs and expenses, net (80)
Account write-offs and other 39  (192)
Allowance for credit losses, end of period $ 2,311  $ 1,988 

Recent Accounting Pronouncements
Income Taxes
In December 2019, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) 2019-12, Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes, eliminates certain exceptions within Accounting Standards Codification (“ASC”) 740, Income Taxes, and clarifies certain aspects of the current guidance to promote consistency among reporting entities. ASU 2019-12 is effective for our fiscal year beginning after December 15, 2020. We adopted this guidance as of January 1, 2021 and the adoption did not have an impact on our condensed consolidated financial statements.
9

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
Reference Rate Reform
In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting. ASU 2020-04, which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting. Companies can apply the ASU immediately, however, the guidance will only be available until December 31, 2022. We are currently evaluating the impact that adopting this new accounting standard would have on our condensed consolidated financial statements and related disclosures.
In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope. The amendments in ASU 2021-01 provide optional expedients to the current guidance on contract modification and hedge accounting from the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. The guidance generally can be applied to applicable contract modifications through December 31, 2022. We are currently evaluating the impact that adopting this new accounting standard would have on our condensed consolidated financial statements and related disclosures.
Codification Improvements
In October 2020, the FASB issued ASU 2020-10, Codification Improvements. The amendments in this ASU represent changes to clarify the ASC, correct unintended application of guidance, or make minor improvements to the ASC that are not expected to have a significant effect on current accounting practice or create a significant administrative cost to most entities. ASU 2020-10 is effective for annual periods beginning after December 15, 2020 and interim periods within those annual periods, with early adoption permitted. The amendments in this ASU should be applied retrospectively. We adopted this guidance as of January 1, 2021 and the adoption did not have an impact on our condensed consolidated financial statements.
3. REVENUE FROM CONTRACTS WITH CUSTOMERS
Disaggregation of Revenue
Our reportable segments for the three and six months ended June 30, 2021 were U.S. Regions, U.S. Federal, Canada and Non-Solar Distributed Generation (“Non-Solar DG”). On January 1, 2021, we changed the structure of our internal organization and our U.S. Regions segment now includes our U.S.-based enterprise energy management services previously included in our “All Other” segment. As a result, previously reported amounts have been reclassified for comparative purposes.
The following table presents our revenue disaggregated by line of business and reportable segment for the three months ended June 30, 2021:
U.S. Regions U.S. Federal Canada Non-Solar DG All Other Total
Project revenue $ 92,601  $ 77,075  $ 7,307  $ 9,241  $ 10,031  $ 196,255 
O&M revenue 5,303  11,742  —  2,462  89  19,596 
Energy assets 10,046  1,371  1,571  23,852  101  36,941 
Integrated-PV —  —  —  —  10,721  10,721 
Other 1,520  12  1,996  16  6,863  10,407 
Total revenues $ 109,470  $ 90,200  $ 10,874  $ 35,571  $ 27,805  $ 273,920 
10

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
The following table presents our revenue disaggregated by line of business and reportable segment for the three months ended June 30, 2020:
U.S. Regions U.S. Federal Canada Non-Solar DG All Other Total
Project revenue $ 76,040  $ 72,220  $ 6,167  $ 3,004  $ 2,499  $ 159,930 
O&M revenue 4,283  10,755  17  2,120  133  17,308 
Energy assets 8,080  1,505  1,344  17,820  —  28,749 
Integrated-PV —  —  —  —  8,530  8,530 
Other 1,171  11  1,507  185  5,645  8,519 
Total revenues $ 89,574  $ 84,491  $ 9,035  $ 23,129  $ 16,807  $ 223,036 
The following table presents our revenue disaggregated by line of business and reportable segment for the six months ended June 30, 2021:
U.S. Regions U.S. Federal Canada Non-Solar DG All Other Total
Project revenue $ 163,759  $ 167,164  $ 16,308  $ 13,895  $ 15,822  $ 376,948 
O&M revenue 9,613  23,182  26  5,099  160  38,080 
Energy assets 18,856  2,035  2,318  46,783  236  70,228 
Integrated-PV —  —  —  —  19,875  19,875 
Other 2,515  33  3,865  162  14,416  20,991 
Total revenues $ 194,743  $ 192,414  $ 22,517  $ 65,939  $ 50,509  $ 526,122 
The following table presents our revenue disaggregated by line of business and reportable segment for the six months ended June 30, 2020:
U.S. Regions U.S. Federal Canada Non-Solar DG All Other Total
Project revenue $ 147,533  $ 128,334  $ 15,031  $ 5,375  $ 8,086  $ 304,359 
O&M revenue 8,635  22,381  26  4,135  193  35,370 
Energy assets 16,934  2,224  2,007  35,806  —  56,971 
Integrated-PV —  —  —  —  19,999  19,999 
Other 2,312  297  3,363  537  12,241  18,750 
Total revenues $ 175,414  $ 153,236  $ 20,427  $ 45,853  $ 40,519  $ 435,449 
The following table presents information related to our revenue recognized over time:
Three Months Ended Six Months Ended
June 30, 2021 June 30, 2020 June 30, 2021 June 30, 2020
Percentage of revenue recognized over time 94% 94% 94% 93%
The remainder is for products and services transferred at a point in time, at which point revenue is recognized.
We attribute revenues to customers based on the location of the customer. The following table presents information related to our revenues by geographic area:
Three Months Ended June 30, Six Months Ended June 30,
2021 2020 2021 2020
United States $ 252,536  $ 211,218  $ 486,545  $ 407,157 
Canada 9,973  8,458  20,826  19,011 
Other 11,411  3,360  18,751  9,281 
Total revenues $ 273,920  $ 223,036  $ 526,122  $ 435,449 

11

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
Contract Balances
The following tables provide information about receivables, contract assets and contract liabilities from contracts with customers:
  June 30, 2021 December 31, 2020
Accounts receivable, net $ 115,462  $ 125,010 
Accounts receivable retainage, net $ 36,485  $ 30,189 
Contract Assets:
Costs and estimated earnings in excess of billings $ 195,027  $ 185,960 
Contract Liabilities:
Billings in excess of cost and estimated earnings $ 26,561  $ 33,984 
Billings in excess of cost and estimated earnings, non-current (1)
6,082  6,631 
Total contract liabilities $ 32,643  $ 40,615 
June 30, 2020 December 31, 2019
Accounts receivable, net $ 86,017  $ 95,863 
Accounts receivable retainage, net $ 19,119  $ 16,976 
Contract Assets:
Costs and estimated earnings in excess of billings $ 195,391  $ 202,243 
Contract Liabilities:
Billings in excess of cost and estimated earnings $ 34,896  $ 26,618 
Billings in excess of cost and estimated earnings, non-current (1)
5,035  5,560 
Total contract liabilities $ 39,931  $ 32,178 
(1) Performance obligations that are expected to be completed beyond the next twelve months and are included in other liabilities in the condensed consolidated balance sheets.
The increase in contract assets for the six months ended June 30, 2021 was primarily due to revenue recognized of $277,960 offset by billings of $288,012. Contract assets also increased due to reclassifications from contract liabilities as a result of timing of customer payments. The decrease in contract liabilities was primarily driven by recognition of revenue as performance obligations were satisfied exceeding increases from the receipt of advance payment from customers, and related billings. For the six months ended June 30, 2021, we recognized revenue of $98,570 that was previously included in the beginning balance of contract liabilities and billed customers $70,884. Changes in contract liabilities are also driven by reclassifications to or from contract assets as a result of timing of customer payments.
The decrease in contract assets for the six months ended June 30, 2020 was primarily due to billings of approximately $285,036, partially offset by revenue recognized of $276,492. The increase in contract liabilities was primarily driven by the receipt of advance payment from customers, and related billings, exceeding increases from the recognition of revenue as performance obligations were satisfied. For the six months ended June 30, 2020, we billed customers $50,697 and recognized revenue of $44,446 that was previously included in the beginning balance of contract liabilities. Changes in contract liabilities are also driven by reclassifications to or from contract assets as a result of timing of customer payments.

Performance Obligations
Our remaining performance obligations (“backlog”) represent the unrecognized revenue value of our contract commitments. At June 30, 2021, we had backlog of $1,902,420 of which approximately 35% is anticipated to be recognized as revenue in the next twelve months. The remaining performance obligations primarily relate to the energy efficiency and renewable energy construction projects, including long-term operations and maintenance (“O&M”) services related to these projects. The long-term services have varying initial contract terms, up to 25 years.
12

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
Project Development Costs
Project development costs of $2,128 and $1,543 were included in other long-term assets in the accompanying condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020, respectively. Project development costs of $3,109 and $4,258 were recognized in the condensed consolidated statements of income on projects that converted to customer contracts during the three months ended June 30, 2021 and 2020, respectively. Project development costs of $5,094 and $5,865 were recognized in the condensed consolidated statements of income on projects that converted to customer contracts during the six months ended June 30, 2021 and 2020, respectively.
No impairment charges in connection with our capitalized commission costs or project development costs were recorded during the six months ended June 30, 2021 and 2020.
4. GOODWILL AND INTANGIBLE ASSETS, NET
The changes in the carrying value of goodwill balances by reportable segment was as follows:
U.S. Regions U.S. Federal Canada Non-solar DG Other Total
Balance, December 31, 2020 $ 26,705  $ 3,981  $ 3,441  $ —  $ 24,587  $ 58,714 
Currency effects —  —  96  —  91  187 
Balance, June 30, 2021 $ 26,705  $ 3,981  $ 3,537  $ —  $ 24,678  $ 58,901 
Definite-lived intangible assets, net consisted of the following:
As of June 30, 2021 As of December 31, 2020
Gross carrying amount $ 27,378  27,240 
Accumulated amortization 26,609  26,313 
Intangible assets, net $ 769  $ 927 
The table below sets forth amortization expense:
Three Months Ended June 30, Six Months Ended June 30,
Asset type Location 2021 2020 2021 2020
Customer contracts Cost of revenues $ —  $ 22  $ —  $ 45 
All other intangible assets Selling, general and administrative expenses 81  158  161  311 
Total amortization expense $ 81  $ 180  $ 161  $ 356 

13

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
5. ENERGY ASSETS, NET
Energy assets, net consisted of the following:
  June 30, 2021 December 31, 2020
Energy assets (1)
$ 1,044,288  $ 954,426 
Less - accumulated depreciation and amortization (245,679) (225,048)
Energy assets, net $ 798,609  $ 729,378 
(1) Includes financing lease assets (see Note 6), capitalized interest and ARO assets (see tables below).
The following table sets forth our depreciation and amortization expense on energy assets, net of deferred grant amortization:
Three Months Ended June 30, Six Months Ended June 30,
Location 2021 2020 2021 2020
Cost of revenues (2)
$ 10,450  $ 9,650  $ 20,136  $ 18,949 
(2) Includes depreciation and amortization on financing lease assets (see Note 6).
The following table presents the interest costs relating to construction financing during the period of construction, which were capitalized as part of energy assets, net:
Three Months Ended June 30, Six Months Ended June 30,
2021 2020 2021 2020
Capitalized interest $ 1,288  $ 912  $ 3,526  $ 1,774 

The following tables sets forth information related to our Asset Retirement Obligations (“ARO”) assets and ARO liabilities:
Location June 30, 2021 December 31, 2020
ARO assets, net Energy assets, net $ 2,004  $ 1,468 
ARO liabilities, current Accrued expenses and other current liabilities $ $ 86 
ARO liabilities, non-current Other liabilities 2,284  1,561 
Total ARO liabilities $ 2,290  $ 1,647 

Three Months Ended June 30, Six Months Ended June 30,
2021 2020 2021 2020
Depreciation expense of ARO assets $ 30  $ 19  $ 53  $ 38 
Accretion expense of ARO liabilities $ 33  $ 22  $ 57  $ 43 

14

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
6. LEASES
The table below sets forth supplemental condensed consolidated balance sheet information related to our leases:
June 30, 2021 December 31, 2020
Operating Leases:
Operating lease assets $ 40,608  $ 39,151 
Current portions of operating lease liabilities $ 5,995  $ 6,106 
Long-term portions of operating lease liabilities 36,731  35,300 
Total operating lease liabilities $ 42,726  $ 41,406 
Weighted-average remaining lease term 13 years 12 years
Weighted-average discount rate 5.79  % 5.94  %
Financing Leases:
Energy assets $ 32,940  $ 34,005 
Current portions of financing lease liabilities $ 3,796  $ 4,273 
Long-term financing lease liabilities, net of current portion, unamortized discount and debt issuance costs 17,617  19,227 
Total financing lease liabilities $ 21,413  $ 23,500 
Weighted-average remaining lease term 16 years 16 years
Weighted-average discount rate 12.04  % 11.94  %
The costs related to our leases were as follows:
Three Months Ended June 30, Six Months Ended June 30,
2021 2020 2021 2020
Operating Leases:
Operating lease costs $ 2,187  $ 2,106  $ 4,340  $ 3,932 
Financing Leases:
Amortization expense 533  532  1,065  1,064 
Interest on lease liabilities 666  726  1,324  1,559 
Total lease costs $ 3,386  $ 3,364  $ 6,729  $ 6,555 



15

AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
Supplemental cash flow information related to our leases was as follows:
Six Months Ended June 30,
2021 2020
Cash paid for amounts included in the measurement of operating lease liabilities $ 4,355  $ 3,861 
Right-of-use assets obtained in exchange for new operating lease liabilities $ 4,961  $ 4,838 
The table below sets forth our estimated minimum future lease obligations under our leases:
  Operating Leases Financing Leases
Year ended December 31,  
2021 $ 4,116  $ 3,485 
2022 8,098  5,178 
2023 6,659  3,676 
2024 5,516  2,565 
2025 4,488  2,213 
Thereafter 32,721  21,866 
Total minimum lease payments 61,598  38,983 
Less: interest 18,872  17,570 
Present value of lease liabilities $ 42,726  $ 21,413 
We have a future lease commitment for a certain ground lease which does not yet meet the criteria for recording a ROU asset or ROU liability. The net present value of this commitment totals $3,000 as of June 30, 2021 and relates to a one-time payment due when specific criteria are met, which we estimate will be during the three months ended September 30, 2021.
Sale-leasebacks
We entered into a fifth amendment dated March 22, 2021 to our August 2018 agreement for a long-term financing facility and increased the maximum funding amount from $150,000 up to $350,000 and extended the end date of the agreement from May 23, 2021 to March 31, 2022. We sold and leased back two energy assets for $26,820 in cash under this facility during the six months ended June 30, 2021. As of June 30, 2021, approximately $284,885 remained available under this lending commitment. These transactions are accounted for as failed sales and are classified as long-term financing facilities. See Note 7 for additional information.
In July 2021, we entered into an amendment to our December 2020 long-term financing facility which increased our maximum commitment from $4,500 to $23,559 and extended the end date of the agreement to December 31, 2021.
Net gains from amortization expense recognized in cost of revenues relating to deferred gains and losses in connection with our sale-leaseback agreements were $57 for the three months ended June 30, 2021 and 2020 and $114 and $112 for the six months ended June 30, 2021 and 2020, respectively.


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AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
7. DEBT AND FINANCING LEASE LIABILITIES
Our debt and financing lease liabilities comprised of the following:
June 30, 2021 December 31, 2020
Senior secured revolving credit facility (1)
$ 25,000  $ 53,073 
Senior secured term loan 55,250  57,688 
Non-recourse term loans 197,959  198,124 
Non-recourse construction revolvers 40,163  26,758 
Long-term financing facilities (2)
55,472  32,618 
Financing lease liabilities (3)
21,413  23,500 
Total debt and financing lease liabilities 395,257  391,761 
Less: current maturities 79,778  69,362 
Less: unamortized discount and debt issuance costs 10,128  10,725 
Long-term debt and financing lease liabilities, net of current portion, unamortized discount and debt issuance costs $ 305,351  $ 311,674 
(1) At June 30, 2021, funds of $141,241 were available for borrowing under this facility.
(2) These facilities are sale-leaseback arrangements and are accounted for as failed sales. See Note 6 for additional disclosures.
(3) Financing lease liabilities are sale-leaseback arrangements under previous guidance. See Note 6 for additional disclosures.

Senior Secured Revolving Credit Facility
On June 22, 2021, we entered into the second amendment to the fourth amended and restated bank credit facility we have syndicated with three banks, which increased the amount of the revolving commitment by the lenders under the credit facility by $65,000 and included the following amendments:
increased the aggregate amount of the revolving commitments from $115,000 to $180,000 through the existing June 28, 2024 maturity date,
increased the total funded debt to EBITDA covenant ratio from a maximum of 3.25 to 3.50, and
decreased the Eurocurrency rate floor from 1% to 0%.
We accounted for this amendment as a modification and at closing we incurred $78 in lender fees which were reflected as debt discount. The unamortized debt discount and issuance costs are being amortized over the remaining term of the agreement.
October 2020 Term Loan Modification
In October 2020, we entered into an amended and restated credit agreement with a bank primarily to increase the commitments under the existing credit agreement and add projects eligible for financing. The new credit agreement increased the commitment from $28,500 to $35,000 and included an option for the lender to increase the commitment by up to an additional $15,000 for a total not to exceed $50,000.
During the six months ended June 30, 2021, the lender increased its commitment by the remaining $15,000 and we received net proceeds of $14,848. The quarterly payments consist of $1,250 in principal plus an additional principal prepayment based on project cash flows in addition to interest to be paid through the earlier of maturity, March 2026, or when the principal balance is paid in full. We accounted for this amendment as a modification and at closing we incurred $150 in lender fees which were reflected as debt discount and $2 in third-party fees which were expensed in selling, general and administrative expenses during the six months ended June 30, 2021. The unamortized debt discount and issuance costs from the October 2020 loan modification are being amortized over the remaining term of the agreement. The balance of the loan outstanding as of June 30, 2021 was $46,988, net of unamortized debt discount and issuance costs.
Construction Revolvers
In June 2020, we entered into a revolving credit agreement with a bank, with an aggregate borrowing capacity of $100,000 for use in financing the construction cost of our owned projects. In March 2021, we entered into a third amendment to this agreement to


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AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
extend this facility from May 2021 to March 2022. All remaining unpaid amounts outstanding under the facility are due at that time.
During the six months ended June 30, 2021, we closed on $14,013 in funding for four additional projects under this facility and drew down an additional $5,117 for existing projects. The balance of this construction revolver as of June 30, 2021 was $33,977, net of unamortized debt issuance costs and funds of $65,693 were available for borrowing under this facility.
We also have funds of $24,145 available for borrowing under our July 2020 construction revolver. In July 2021, two projects financed under this revolver failed to achieve commercial operations date (“COD”) on a timely basis; however, we received a limited waiver and an extension of COD for both projects from our lender, which cured the resulting event of default retroactively.

July 2021 Term Loan
On July 27, 2021, we entered into a $44,748 non-recourse solar debt financing with a group of lenders. The financing consists of a 25-year 3.25% fixed rate term loan of $40,683, a 9-year $4,065 floating rate term loan and additional funding available of up to $60,000.
8. INCOME TAXES
We recorded a benefit for income taxes of $(1,896) and $— for the three months ended June 30, 2021 and 2020, respectively. The estimated effective annualized tax rate impacted by the period discrete items is a benefit of 11.9% for the three months ended June 30, 2021, compared to a 0.0% of estimated effective annualized tax rate for the three months ended June 30, 2020.
We recorded a provision (benefit) for income taxes of $309 and $(2,503) for the six months ended June 30, 2021 and 2020, respectively. The estimated effective annualized tax rate impacted by the period discrete items is 1.0% for the six months ended June 30, 2021, compared to a benefit of 19.3% of estimated effective annualized tax rate for the six months ended June 30, 2020.
The principal reasons for the difference between the statutory rate and the estimated annual effective rate for 2021 were the effects of investment tax credits which we are entitled from solar plants placed into service or are forecasted to be placed into service during 2021, the tax deductions related to the Section 179D deduction, the deduction of compensation expense associated with certain employee stock options, and tax basis adjustments on certain partnership flip transactions.
The principal reason for the difference between the statutory rate and the estimated annual effective rate for 2020 were the effects of investment tax credits to which we are entitled from solar plants which were placed into service during 2020, tax deductions related to the Section 179D deduction, tax basis adjustments on certain partnership flip transactions, and tax rate benefits associated with the net operating loss carryback made possible by the passing of the COVID-19 CARES Act on March 27, 2020.
Under GAAP accounting rules deferred taxes are shown on a net basis in the consolidated financial statements based on taxing jurisdiction. Under the guidance, we have recorded long term deferred tax assets and deferred tax liabilities based on the underlying jurisdiction in the accompanying condensed consolidated balance sheets.
The following table sets forth the total amounts of gross unrecognized tax benefits:
Gross Unrecognized
Tax Benefits
Balance, December 31, 2020 $ 600 
Additions for prior year tax positions 200 
Balance, June 30, 2021 $ 800 
The amount of unrecognized tax benefits that, if recognized, would favorably affect the effective income tax rate in any future periods was $400 at June 30, 2021 and $190 at December 31, 2020 (net of the federal benefit on state amounts).
We presented all deferred tax assets and liabilities as noncurrent, net liabilities on our condensed consolidated balance sheets as of June 30, 2021, and December 31, 2020.


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NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
9. COMMITMENTS AND CONTINGENCIES
From time to time, we issue letters of credit and performance bonds with our third-party lenders, to provide collateral.
Legal Proceedings
On November 6, 2017, we were served with a complaint filed by a customer against nine contractors, including us, claiming both physical damages to the customer’s tangible property and damages caused by various alleged defects in the design of the project through negligent acts and/or omissions, breaches of contract and breaches of the “implied warranty of good and workmanlike manner.” A mediation was held in January 2021, at which time we made an offer to settle the case, in an amount which we believe would be covered by our insurance. The trial has been set for April 2022 and both parties are taking discovery. Although the customer rejected our offer, both parties have agreed to continue to negotiate a settlement. We believe that it is probable that a loss will be incurred and, therefore, have accrued a reasonable estimate of the loss, which is included in accrued expenses and other current liabilities in our condensed consolidated balance sheets as of June 30, 2021 and December 31, 2020. In addition, we accrued a loss recovery from insurance proceeds as we believe the receipt of such proceeds is probable. The loss recovery accrual is included in prepaid expenses and other current assets in our consolidated balance sheets as of June 30, 2021 and December 31, 2020. There were no changes to our estimate during the six months ended June 30, 2021.
We are involved in a variety of other claims and other legal proceedings generally incidental to our normal business activities. While the outcome of any of these proceedings cannot be accurately predicted, we do not believe the ultimate resolution of any of these existing matters would have a material adverse effect on our financial condition or results of operations.
Commitment as a Result of an Acquisition
In August 2018, we completed an acquisition which provided for a revenue earn-out contingent upon the acquired business meeting certain cumulative revenue targets over 5 years from the acquisition date. The fair value was $678 as of June 30, 2021 and December 31, 2020 and is included in other liabilities on the condensed consolidated balance sheets. The contingent consideration will be paid annually in May, if any of the cumulative revenue targets are achieved. No payments have been made to date.
10. FAIR VALUE MEASUREMENT
We recognize our financial assets and liabilities at fair value on a recurring basis (at least annually). Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Three levels of inputs that may be used to measure fair value are as follows:
Level 1: Inputs are based on unadjusted quoted prices for identical instruments traded in active markets. 
Level 2: Inputs are based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuation techniques for which all significant assumptions are observable in the market or can be corroborated by observable market data for substantially the full term of the assets or liabilities. 
Level 3: Inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques that include option pricing models, discounted cash flow models, and similar techniques. 


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AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
The following table presents the input level used to determine the fair values of our financial instruments measured at fair value on a recurring basis:
Fair Value as of
Level June 30, 2021 December 31, 2020
Assets:
Interest rate swap instruments 2 $ 743  $
Commodity swap instruments 2 —  363 
Total assets $ 743  $ 365 
Liabilities:
Interest rate swap instruments 2 $ 7,859  $ 10,073 
Commodity swap instruments 2 1,135  — 
Make-whole provisions 2 1,247  412 
Contingent consideration 3 678  678 
Total liabilities $ 10,919  $ 11,163 

The following table sets forth the fair value and the carrying value of our long-term debt, excluding financing leases:
As of June 30, 2021 As of December 31, 2020
Fair Value Carrying Value Fair Value Carrying Value
Long-term debt (Level 2) $ 367,427  $ 363,716  $ 363,460  $ 357,536 
The fair value of our long-term debt was estimated using discounted cash flows analysis, based on our current incremental borrowing rates for similar types of borrowing arrangements which are considered to be level two inputs. There have been no transfers in or out of level two or three financial instruments for the six months ended June 30, 2021 and the year ended December 31, 2020.
We are also required to periodically measure certain other assets at fair value on a nonrecurring basis, including long-lived assets, goodwill and other intangible assets. We calculated the fair value used in our annual goodwill impairment analysis utilizing a discounted cash flow analysis and determined that the inputs used were level 3 inputs. There were no assets recorded at fair value on a non-recurring basis as of June 30, 2021 or December 31, 2020.
11. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES
The following table presents information about the fair value amounts of our cash flow derivative instruments: 
  Derivatives as of
  June 30, 2021   December 31, 2020
  Balance Sheet Location Fair Value Fair Value
Derivatives Designated as Hedging Instruments:
Interest rate swap contracts Other liabilities $ 7,818  $ 9,994 
Derivatives Not Designated as Hedging Instruments:
Interest rate swap contracts Other assets $ 743  $
Interest rate swap contracts Other liabilities $ 41  $ 79 
Commodity swap contracts Other assets $ —  $ 363 
Commodity swap contracts Other liabilities $ 1,135  $ — 
Make-whole provisions Other liabilities $ 1,247  $ 412 
As of June 30, 2021 and December 31, 2020, all but four of our freestanding derivatives were designated as hedging instruments.


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AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
The following table presents information about the effects of our derivative instruments on our condensed consolidated statements of income and condensed consolidated statements of comprehensive income:
Amount of (Gain) Loss Recognized in Net Income
Location of (Gain) Loss Recognized in Net Income Three Months Ended June 30, Six Months Ended June 30,
2021 2020 2021 2020
Derivatives Designated as Hedging Instruments:
Interest rate swap contracts Other expenses, net $ 522  $ 306  $ 1,045  $ 405 
Derivatives Not Designated as Hedging Instruments:
Interest rate swap contracts Other expenses, net $ 543  $ (11) $ (779) $ (1)
Commodity swap contracts Other expenses, net $ 1,250  $ 95  1,498  47 
Make-whole provisions Other expenses, net $ (205) $ 655  506  470 
The following table presents the changes in Accumulated Other Comprehensive Income (“AOCI”), net of taxes, from our hedging instruments:
Six Months Ended June 30, 2021
Derivatives Designated as Hedging Instruments:
Accumulated loss in AOCI at the beginning of the period $ (7,526)
Unrealized gain recognized in AOCI 600 
Loss reclassified from AOCI to other expenses, net 1,045 
Net gain on derivatives 1,645 
Accumulated loss in AOCI at the end of the period $ (5,881)
The following tables present all of our active derivative instruments as of June 30, 2021:
Active Interest Rate Swaps Effective Date Expiration Date Initial Notional
Amount ($)
Status
11-Year, 5.77% Fixed
October 2018 October 2029 $ 9,200  Designated
15-Year, 5.24% Fixed
June 2018 June 2033 $ 10,000  Designated
10-Year, 4.74% Fixed
June 2017 December 2027 $ 14,100  Designated
15-Year, 3.26% Fixed
February 2023 December 2038 $ 14,084  Designated
7-Year, 2.19% Fixed
February 2016 February 2023 $ 20,746  Designated
8-Year, 3.70% Fixed
March 2020 June 2028 $ 14,643  Designated
8-Year, 3.70% Fixed
March 2020 June 2028 $ 10,734  Designated
13-Year, 0.93% Fixed
May 2020 March 2033 $ 9,505  Not Designated
13-Year, 0.93% Fixed
May 2020 March 2033 $ 6,968  Not Designated
15.5-Year, 5.40% Fixed
September 2008 March 2024 $ 13,081  Designated
2.75-Year, 0.41% Fixed
December 2020 September 2023 $ 26,250  Not Designated
Active Commodity Swaps Effective Date Expiration Date Initial Notional Amount (Volume) Commodity Measurement Status
3.5-Year, $2.65 MMBtu Fixed
December 2020 June 2024 3,296,160  MMBtus Not Designated


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AMERESCO, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(In thousands) (Unaudited) (Continued)
Other Derivatives Classification Effective Date Expiration Date Fair Value ($)
Make-whole provisions Liability June/August 2018 December 2038 $ 545 
Make-whole provisions Liability August 2016 April 2031 $ 89 
Make-whole provisions Liability April 2017 February 2034 $ 109 
Make-whole provisions Liability November 2020 December 2027 $ 90 
Make-whole provisions Liability October 2011 May 2028 $ 37 
Make-whole provisions Liability May 2021 April 2045 $ 377 
12. INVESTMENT FUNDS AND EQUITY METHOD INVESTMENTS
Investment Funds
The table below presents a summary of amounts related to our investment funds, which we determined meet the definition of a variable interest entity (“VIE”) as of:
June 30, December 31,