Opening of Proposals - WWTP Solar Guaranteed Energy Savings Contract Proj. No. 124-015 - Ameresco

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Table of Contents AMERESCO, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (In thousands, except per share amounts) through fiscal 2059. The office and land leases make up a significant portion of our operating lease activity. Many of these leases hav®ne or more renewal options that allow us, at our discretion, to renew the lease for six months to seven years. Only renewal options that we believed were likely to be exercised were included in our lease calculations. Many land leases include minimum lease payments that commence or increase when the related project becomes operational. In these cases, we estimated the commercial operation date used to calculate the ROU asset and minimum lease payments. A portion of our real estate leases are generally subject to annual changes in the Consumer Price Index ("CPI"). We utilized each lease's minimum lease payments to calculate the lease balances upon transition. The subsequent increases in rent based on changes in CPI were excluded and will be excluded for future leases from the calculation of the lease balances but will be recorded to the consolidated statements of income as part of our operating lease costs. The discount rate was calculated using an incremental borrowing rate based on financing rates on secured comparable notes with comparable terms and a synthetic credit rating calculated by a third party. We elected to apply the discount rate using the remaining lease term at the date of adoption. We also enter into leases for service agreements and other leases related to our construction projects such as equipment, mobile trailers, and other temporary structures. We utilize the portfolio approach for this class of lease, which are either short-term leases or are not material. Rent and related expenses were as follows: Rent and related expenses Year Ended December 31, 2023 2022 2021 $ 10,504 $ 9,199 $ 9,740 We have a number of leases that are classified as financing leases, which related to transactions that were considered sale -leasebacks under ASC 840. See the sale -leaseback section below for additional information on our financing leases. The table below sets forth supplemental balance sheet information related to leases: Operating Leases Operating lease assets Current portion of operating lease liabilities Long-term operating lease liabilities, net of current portion Total Operating lease liabilities Weighted -average remaining lease term Weighted -average discount rate Financing Leases 111 Energy assets, net Current portions of financing lease liabilities Long-term financing lease liabilities, net of current portion, unamortized discount and debt issuance costs Total financing lease liabilities Weighted -average remaining lease term Weighted -average discount rate (1) Includes sale -leaseback transactions entered into prior to January 1, 2019. 77 December 31, 2023 2022 $ 58,586 $ $ 13,569 $ 42,258 38,224 5,829 31,703 $ 55,827 $ 37,532 18 years 6.6 % 13 years 6.0 % $ 27,262 $ 29,365 $ 871 $ 1,992 13,057 14,068 $ 13,928 $ 16,060 13 years 14 years 12.05 % 12.1 %