View Filing Data

Less: Pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison

(282)

(1,630)

Sale of membership interests in renewable energy facilities

(25,443)

12,778

Ending balance at Dec. 31, 2013

15,452

2,674

$ 0

12,778

Ending balance (in shares) at Dec. 31, 2013

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Less: Net income attributable to redeemable non-controlling interests

Issuance of stock

$ 0

$ (657)

$ 14

$ 657

$ (14)

$ 0

Issuance of stock (shares)

4,977,000

65,709,000

Stock-based compensation

566

Less: Pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison

(9,714)

(10,357)

643

(798)

Additions to non-controlling interests

418,388

222,388

Ending balance at Jul. 23, 2014

646,282

410,473

409,250

$ 14

$ 657

$ 0

552

235,809

235,166

643

Ending balance (in shares) at Jul. 23, 2014

4,977,000

65,709,000

Beginning balance at Dec. 31, 2013

15,452

2,674

$ 0

12,778

Beginning balance (in shares) at Dec. 31, 2013

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Issuance of B1 common stock to Riverstone for Mt. Signal

146,000

Less: Pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison

(1,498)

Ending balance at Dec. 31, 2014

(5,466)

Equity reallocation

139,100

1,515,921

471,392

$ 387

$ 645

$ 58

498,256

(26,317)

(1,637)

1,044,529

1,092,809

(44,451)

(3,829)

Ending balance (in shares) at Dec. 31, 2014

42,217,984.000

64,526,654

5,840,000

42,218,000

64,526,000

5,840,000

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Less: Net income attributable to redeemable non-controlling interests

Beginning balance at Jul. 23, 2014

646,282

410,473

409,250

$ 14

$ 657

$ 0

552

235,809

235,166

643

Beginning balance (in shares) at Jul. 23, 2014

4,977,000

65,709,000

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Issuance of stock

$ 770,421

$ 0

770,421

$ (634,963)

$ 0

$ (412,808)

$ 373

$ (70)

770,118

$ (222,155)

$ 634,963

$ 0

$ (58)

$ 58

$ 0

Issuance of stock (shares)

37,241,000

(7,023,000)

5,840,000

Issuance of B1 common stock to Riverstone for Mt. Signal

$ 0

$ 146,000

$ (57,633)

$ 0

$ 58

$ 145,942

$ (57,633)

$ (146,000)

$ 57,633

$ (146,000)

$ 57,633

Issuance of class B1 common stock to Riverstone at IPO (shares)

5,840,000

Write-off U.S. deferred tax assets and liabilities at IPO

3,616

Dividends

(7,249)

Stock-based compensation

5,221

Less: Pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison

(70,711)

(25,617)

(45,094)

(700)

(5,466)

(1,637)

(3,829)

Additions to non-controlling interests

6,556

2,569

3,987

169,274

Distributions to non-controlling interests

(1,323)

Equity reallocation

(139,109)

139,109

Ending balance at Dec. 31, 2014

1,515,921

471,392

$ 0

$ 387

$ 645

$ 58

498,256

(26,317)

(1,637)

1,044,529

1,092,809

(44,451)

(3,829)

Ending balance (in shares) at Dec. 31, 2014

42,217,984.000

64,526,654

5,840,000

42,218,000

64,526,000

5,840,000

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Issuance of stock

$ 921,610

$ 318

$ (41)

$ 921,333

Issuance of stock (shares)

31,912,000

(4,162,000)

Riverstone exchange (in shares)

5,840,000

(5,840,000)

Riverstone exchange

$ 58

$ (58)

Issuance of B1 common stock to Riverstone for Mt. Signal

Dividends

(88,705)

Stock-based compensation (in shares)

(236,000)

(122,000)

Stock-based compensation

20,207

$ 21

22,622

$ (2,436)

Less: Pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison

^[1]

(218,257)

(79,886)

(138,371)

1,610

13,130

Pre-acquisition other comprehensive income of renewable energy facilities acquired from SunEdison

(26,886)

(15,479)

(11,407)

40,016

Consolidation of non-controlling interests in acquired renewable energy facilities

413,014

Repurchase of non-controlling interest

(54,694)

Sale of membership interests in renewable energy facilities

153,401

84,288

69,113

346,704

Distributions to non-controlling interests

(83,672)

Equity reallocation

170,300

(170,310)

170,310

Ending balance at Dec. 31, 2015

$ 2,940,269

$ 1,184,743

$ 784

$ 604

$ 0

$ 1,267,484

(104,593)

$ 22,900

$ (2,436)

$ 1,755,526

$ 1,953,584

$ (182,822)

$ (15,236)

Ending balance (in shares) at Dec. 31, 2015

139,976,687

79,612,533

60,364,154

79,734,000

60,364,000

(122,000)

60,364,154

Increase (Decrease) in Stockholders' Equity [Roll Forward]

Less: Net income attributable to redeemable non-controlling interests

$ 8,512

[1]	Excludes $8,512 of net income attributable to redeemable non-controlling interests

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Cash flows from operating activities:
Net loss	$ (208,135)	$ (81,923)	$ (1,912)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Stock-based compensation expense	13,125	5,787	0
Depreciation, accretion and amortization expense	161,310	41,280	5,731
Amortization of favorable and unfavorable rate revenue contracts, net	5,304	4,190	0
Loss on prepaid warranty - affiliate	45,380	0	0
Loss on investments and receivables - affiliate	16,079	0	0
Amortization of deferred financing costs and debt discounts	27,028	25,793	198
Recognition of deferred revenue	(9,909)	(258)	(205)
Loss (gain) on extinguishment of debt, net	16,156	(7,635)	0
Unrealized loss on derivatives, net	1,413	0	0
Unrealized loss (gain) on foreign currency exchange, net	22,343	11,920	(771)
Deferred taxes	(13,497)	(4,773)	(253)
Other, net	9,395	(9,257)	(609)
Changes in assets and liabilities:
Accounts receivable	(11,272)	(3,431)	(892)
Prepaid expenses and other current assets	12,189	22,921	(33,698)
Accounts payable, accrued expenses and other current liabilities	19,887	4,062	4,902
Deferred revenue	19,383	71,129	792
Due to SunEdison, net	0	4,422	18,865
Other, net	(1,919)	0	0
Net cash provided by (used in) operating activities	124,260	84,227	(7,852)
Cash flows from investing activities:
Cash paid to third parties for renewable energy facility construction	(617,649)	(1,122,293)	(210,360)
Other investments	(8,400)	0	0
Acquisitions of renewable energy facilities from third parties, net of cash acquired	(2,471,600)	(644,890)	0
Due to SunEdison, net	(26,153)	(56,088)	0
Change in restricted cash	(48,609)	23,635	(58,878)
Net cash used in investing activities	(3,172,411)	(1,799,636)	(269,238)
Cash flows from financing activities:
Proceeds from issuance of Class A common stock	921,610	770,421	0
Change in restricted cash for principal debt service	0	1,897	2,834
Proceeds from Term Loan	0	575,000	0
Repayment of Term Loan	(573,500)	(1,500)	0
Proceeds from bridge loan	0	400,000	0
Repayment of bridge loan	0	(400,000)	0
Proceeds from Revolver	890,000	0	0
Repayment of Revolver	(235,000)	0	0
Borrowings of non-recourse long-term debt	1,425,033	471,923	304,729
Principal payments on non-recourse long-term debt	(515,514)	(341,191)	(5,928)
Due to SunEdison, net	(145,247)	199,369	6,936
Contributions from non-controlling interests	349,736	164,742	12,778
Distributions to non-controlling interests	(28,145)	(1,323)	0
Repurchase of non-controlling interests	(63,198)	0	0
Distributions to SunEdison	(58,291)	0	0
Net SunEdison investment	149,936	405,062	(32,702)
Payment of dividends	(88,705)	(7,249)	0
Debt prepayment premium	(6,412)	0	0
Debt financing fees	(59,672)	(54,060)	(10,516)
Net cash provided by financing activities	3,208,593	2,183,091	278,131
Net increase in cash and cash equivalents	160,442	467,682	1,041
Effect of exchange rate changes on cash and cash equivalents	(2,401)	(172)	0
Cash and cash equivalents at beginning of period	468,554	1,044	3
Cash and cash equivalents at end of period	626,595	468,554	1,044
Supplemental Disclosures:
Cash paid for interest, net of amounts capitalized of $22,423, $19,694 and $3,599, respectively	114,452	79,867	8,564
Cash paid for income taxes	0	0	0
Schedule of non-cash activities:
Additions to renewable energy facilities in accounts payable, accrued expenses and other current liabilities	3,709	15,046	0
Additions to renewable energy facilities in Due from SunEdison	0	9,780	54,090
Additions of asset retirement obligation (ARO) assets and liabilities	52,181	34,414	4,518
ARO assets and obligations from acquisitions	74,293	29,450	0
Long-term debt assumed in connection with acquisitions	667,384	550,936	0
Amortization of deferred financing costs included as construction in progress	0	17,589	791
Decrease in Due to SunEdison in exchange for equity	0	14,768	0
Issuance of B1 common stock to Riverstone for Mt. Signal	0	146,000	0
Non-controlling interest in Terra LLC (Class B units) issued in connection with the initial public offering	0	634,963	0
Non-controlling interest in Terra LLC (Class B1 units) issued in connection with the initial public offering	0	57,633	0
Write-off of pre-IPO U.S. deferred tax assets and liabilities	0	3,616	0
Senior Notes due 2023
Cash flows from financing activities:
Proceeds from Senior Notes	945,962	0	0
Senior Notes due 2025
Cash flows from financing activities:
Proceeds from Senior Notes	$ 300,000	$ 0	$ 0

Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2015	Dec. 31, 2014	Dec. 31, 2013
Statement of Cash Flows [Abstract]
Interest capitalized	$ 22,423	$ 19,694	$ 3,599

Nature of Operations	12 Months Ended
Nature of Operations	Dec. 31, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Nature of Operations	NATURE OF OPERATIONS TerraForm Power, Inc. ("TerraForm Power") and its subsidiaries (the "Company") is a controlled affiliate of SunEdison, Inc. (together, with its consolidated subsidiaries excluding the Company, "SunEdison"). TerraForm Power is a holding company and its sole asset is an equity interest in TerraForm Power, LLC ("Terra LLC" or "the Predecessor"), an owner of renewable energy facilities that have long-term contractual arrangements to sell the electricity generated by these facilities to third parties. The related green energy certificates, ancillary services and other environmental attributes generated by these facilities are also sold to third parties. TerraForm Power is the managing member of Terra LLC, and operates, controls and consolidates the business affairs of Terra LLC. On April 21, 2016, SunEdison Inc. and certain of its domestic and international subsidiaries (the "SunEdison Debtors") voluntarily filed for protection under Chapter 11 of the U.S. Bankruptcy Code (the "SunEdison Bankruptcy"). The Company is not a part of the SunEdison Bankruptcy and has no plans to file for bankruptcy itself. The Company does not rely substantially on SunEdison for funding or liquidity and believes that the Company will have sufficient liquidity to support its ongoing operations. The Company believes its equity interests in its renewable energy facilities that are legally owned by the Company’s subsidiaries are not available to satisfy the claims of the creditors of the SunEdison Bankruptcy. While the Company continues to evaluate SunEdison's bankruptcy filings and will continue to monitor the conduct of the bankruptcy proceedings and work to assert and enforce any claims that it may have against SunEdison through those proceedings, the SunEdison Bankruptcy may have a material adverse effect on the Company given its reliance on SunEdison. During the SunEdison Bankruptcy, SunEdison has not performed substantially as obligated under its agreements with the Company, including under the sponsorship arrangements consisting of the various corporate-level agreements put in place at the time of the Company's IPO (collectively the "Sponsorship Arrangement") and certain operation and maintenance ("O&M") and asset management arrangements. SunEdison's failure to perform substantially as obligated under its agreements with the Company, including under the Sponsor Arrangement, project-level O&M and asset management agreements and other support agreements, may have a material adverse effect on the Company. Despite these adverse effects, the Company expects that it will be able to operate its business without the support of SunEdison pursuant to the plans for transitioning away from reliance on SunEdison that it is in the process of implementing. These plans include, among other things, establishing stand-alone information technology, accounting and other critical systems and infrastructure, directly hiring employees, and retaining backup or replacement operation and maintenance and asset management services for the Company's wind and solar facilities from other providers. The Company's business will be negatively impacted to the extent it is unsuccessful in implementing the relevant plans or the resulting ongoing long-term costs are higher than the costs the Company expected to incur with SunEdison as a sponsor. On September 25, 2016, the Company filed its initial proof of claim in the SunEdison Bankruptcy case, which was amended on October 7, 2016. As set forth in the proofs of claim, the Company has unsecured claims against SunEdison that are estimated to be in excess of $1.0 billion. These claims include, without limitation, claims for damages relating to breach of SunEdison's obligations under the sponsorship arrangement between the Company and SunEdison and other agreements; contribution and indemnification claims arising from litigation; claims relating to SunEdison's breach of fiduciary, agency and other duties; and claims for interference with and the disruption of the business of the Company, including the loss of business opportunities, loss of business records, failure to provide timely audited financials, and the increased cost of financing and commercial arrangements. Many of these claims are contingent, unliquidated and/or disputed by SunEdison and other parties in interest in the SunEdison Bankruptcy Case, and the estimated amounts of these claims may change substantially as circumstances develop and damages are determined. In addition, recoveries on unsecured claims in the SunEdison Bankruptcy Case are expected to be significantly impaired. On December 1, 2016, the official committee of unsecured creditors of the SunEdison Bankruptcy filed an omnibus objection to the proofs of claim filed by the Company. In addition, the Company believes that it may have claims entitled to administrative priority against SunEdison, including, without limitation, claims with respect to certain expenses that it has incurred after the commencement of the SunEdison Bankruptcy Case; however, the Company expects SunEdison and other parties in interest in the SunEdison Bankruptcy Case to dispute both the amount of these claims and whether or not these claims are entitled to administrative priority over other claims against SunEdison. On November 7, 2016, the official committee of unsecured creditors of the SunEdison Bankruptcy filed a notice of motion of leave, standing and authority to commence an action for, and settlement authority with respect to, avoidance claims against the Company arising intercompany transactions between the Company and SunEdison. The Company filed an objection to the standing motion on November 29, 2016. A hearing on the motion is scheduled for December 6, 2016. In addition, in the future, the Company believes that SunEdison may assert, or other parties with interest in the SunEdison Bankruptcy may seek to assert on SunEdison's behalf, certain claims against the Company. The Company intends to vigorously contest any avoidance claims asserted against it in the SunEdison Bankruptcy Case, including to the extent any such claims are brought by the official committee of unsecured creditors if it is successful in its standing motion. The Company is currently engaged in settlement discussions with SunEdison to resolve, among other issues, intercompany claims and defenses, including the claims described in the preceding three paragraphs. While these settlement discussions remain ongoing and there can be no guarantee that a settlement will be reached, the Company believes that a successful settlement could facilitate the Company’s exploration of strategic alternatives. Any settlement would be subject to the approval of the bankruptcy court in the SunEdison Bankruptcy. In most of the Company's debt-financed projects, SunEdison Debtors are a party to a material project agreement or guarantor thereof, such as being a party to or guarantor of an asset management or O&M contract. As a result of the SunEdison Bankruptcy and delays in delivery of audited financial statements for certain project-level subsidiaries, among other things, the Company has experienced defaults under most of its non-recourse financing agreements; however, these defaults are generally curable. To date none of the non-recourse financings has been accelerated and no project-level lender has notified the Company of such lenders election to enforce project security interests. While the Company has obtained waivers or temporary forbearances with respect to certain of these project-level defaults, no assurances can be given that the Company will obtain waivers and/or permanent forbearance agreements for the remaining projects, or that none of the financings will be accelerated. The Company is continuing to monitor the situation and is developing and implementing plans to obtain operation and maintenance and asset management services for its renewable energy facilities from third parties. The Company's corporate-level Revolver and Indentures do not include an event of default provision directly triggered by the occurrence of the SunEdison Bankruptcy. Going Concern The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern. Our sponsor, SunEdison, Inc., and certain of its affiliates filed for bankruptcy on April 21, 2016. We believe that we have observed formalities and operating procedures to maintain our separate existence, that our assets and liabilities can be readily identified as distinct from those of SunEdison and that we do not rely substantially on SunEdison for funding or liquidity and will have sufficient liquidity to support our ongoing operations. Our contingency planning with respect to the SunEdison Bankruptcy has and will include, among other things, establishing stand-alone information technology, accounting and other critical systems and infrastructure, establishing separate human resources systems and employee retention efforts, and retaining backup or replacement operation and maintenance and asset management services for our power plants from other providers. However, there is a risk that an interested party in the SunEdison Bankruptcy could request that the assets and liabilities of the Company be substantively consolidated with SunEdison and that the Company and/or its assets and liabilities be included in the SunEdison Bankruptcy. While it has not been requested to date and we believe there is no basis for substantive consolidation in our circumstances, we cannot assure you that substantive consolidation will not be requested in the future or that the bankruptcy court would not consider it. Substantive consolidation is an equitable remedy in bankruptcy that results in the pooling of assets and liabilities of the debtor and one or more of its affiliates solely for purposes of the bankruptcy case, including for purposes of distributions to creditors and voting on and treatment under a reorganization plan. Bankruptcy courts have broad equitable powers, and as a result, outcomes in bankruptcy proceedings are inherently difficult to predict. To the extent the bankruptcy court were to determine that substantive consolidation was appropriate under the Company's facts and circumstances, the assets and liabilities of the Company could be made available to help satisfy the debt or contractual obligations of SunEdison. Additionally, there have been covenant defaults under a number of our financing arrangements, mainly because of delays in the delivery of project-level audited financial statements and the delay in the filing of the Company’s audited annual financial statements for 2015 on Form 10-K. In addition, in a number of cases the SunEdison Bankruptcy resulted in defaults because SunEdison Debtors have been serving as operation and maintenance and asset management services providers or as guarantors under relevant contracts. We have been working diligently with our lenders to cure or waive instances of default, including through the completion of project-level audits and the retention of replacement service providers. However, there can be no assurance that all remaining defaults will be cured or waived. If the remaining defaults are not cured or waived, this would restrict the ability of the relevant project-level subsidiaries to make distributions to us, which may affect our ability to meet certain covenants related to our revolving credit facility at the corporate level, or entitle the related lenders to demand repayment or enforce their security interests, which could have a material adverse effect on our business, results of operations, financial condition and ability to pay dividends. The risk of substantive consolidation of the Company with SunEdison and inclusion in the SunEdison Bankruptcy as well as the existing covenant defaults and risks of future covenant defaults under a number of our financing agreements, raise substantial doubt about the Company’s ability to continue as a going concern. Basis of Presentation The Company is required to recast historical financial statements when renewable energy facilities are acquired from SunEdison. The recast reflects the assets and liabilities and the results of operations of the acquired renewable energy facilities for the period the facilities were owned by SunEdison, which is in accordance with applicable rules governing transactions between entities under common control. The Company has modified the presentation of its consolidated statement of operations to separate pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison from net loss attributable to Class A common stockholders. For all periods prior to the Company's initial public offering ("IPO") on July 23, 2014, the accompanying consolidated financial statements represent the combination of TerraForm Power and Terra LLC, the accounting predecessor, and were prepared using SunEdison's historical basis in assets and liabilities. For all periods subsequent to the IPO, the accompanying consolidated financial statements represent the results of TerraForm Power, which consolidates Terra LLC through its controlling interest. The historical financial statements of the Predecessor include allocations of certain SunEdison corporate expenses and income tax expense. Management believes the assumptions and methodology underlying the allocation of general corporate overhead expenses are reasonable. Subsequent to the IPO, corporate expenses represent actual costs incurred by the Company under the Management Services Agreement, as more fully described in Note 19. Related Parties.

Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2015

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Use of Estimates

In preparing the consolidated financial statements, the Company used estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements. Such estimates also affect the reported amounts of revenues, expenses and cash flows during the reporting period. To the extent there are material differences between the estimates and actual results, the Company's future results of operations would be affected.

Principles of Consolidation

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). They include the results of wholly owned and partially owned subsidiaries in which the Company has a controlling interest with all significant intercompany accounts and transactions eliminated. The Company consolidates variable interest entities ("VIEs") in renewable energy facilities when determined to be the primary beneficiary.

Variable Interest Entities

The Company consolidates VIEs when the Company is the primary beneficiary. The primary beneficiary of a VIE is the party that has the power to direct the activities that most significantly impact the performance of the entity and the obligation to absorb losses or the right to receive benefits that could potentially be significant to the entity.

VIEs are entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders, as a group, lack one or more of the following characteristics: (a) direct or indirect ability to make decisions; (b) obligation to absorb expected losses; or (c) right to receive expected residual returns. VIEs must be evaluated quantitatively and qualitatively to determine the primary beneficiary, which is the reporting entity that has (a) the power to direct activities of a VIE that most significantly impact the VIEs economic performance and (b) the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. The primary beneficiary is required to consolidate the VIE for financial reporting purposes. A VIE can have only one primary beneficiary, but may not have a primary beneficiary if no party meets the criteria described above.

To determine a VIE's primary beneficiary, an enterprise must perform a qualitative assessment to determine which party, if any, has the power to direct activities of the VIE, the obligation to absorb losses, and/or receive its benefits. Therefore, an enterprise must identify the activities that most significantly impact the VIE's economic performance and determine whether it, or another party, has the power to direct those activities. When evaluating whether the Company is the primary beneficiary of a VIE, the Company performs a qualitative analysis that considers the design of the VIE, the nature of the Company's involvement and the variable interests held by other parties. If that evaluation is inconclusive as to which party absorbs a majority of the entity’s expected losses or residual returns, a quantitative analysis is performed to determine the primary beneficiary.

For the Company's consolidated VIEs, the Company has presented on its consolidated balance sheets, to the extent material, the assets of its consolidated VIEs that can only be used to settle specific obligations of the consolidated VIE, and the liabilities of its consolidated VIEs for which creditors do not have recourse to the Company's general assets outside of the VIE.

Cash and Cash Equivalents

Cash and cash equivalents include all cash balances and money market funds with original maturity periods of three months or less when purchased. As of December 31, 2015 and 2014, cash and cash equivalents included $81.1 million and $12.0 million, respectively, of unrestricted cash held at project-level subsidiaries, which was available for project expenses but not available for corporate use.

Restricted Cash

Restricted cash consists of cash on deposit in financial institutions that is restricted to satisfy the requirements of

certain debt agreements and funds held within the Company's project companies that are restricted for current debt service payments and other purposes in accordance with the applicable debt agreements. These restrictions include: (i) cash on deposit in collateral accounts, debt service reserve accounts and maintenance reserve accounts; and (ii) cash on deposit in operating

accounts but subject to distribution restrictions related to debt defaults existing as of the balance sheet date.

As discussed in Note 10. Long-term debt, the Company experienced defaults under most of its non-recourse financing agreements prior to the issuance of the financial statements for the year ended December 31, 2015. As a result, the Company reclassified $61.1 million of long-term restricted cash to current as of December 31, 2015, consistent with the corresponding debt classification, as the restrictions that required the cash balances to be classified as long-term restricted cash were driven by the financing agreements.

Accounts Receivable and Allowance for Doubtful Accounts

Accounts receivable are reported on the consolidated balance sheets, including both billed and unbilled amounts, and are adjusted for any write-offs as well as the allowance for doubtful accounts. The Company establishes an allowance for doubtful accounts to adjust its receivables to amounts considered to be ultimately collectible and charges to the allowance are recorded within general and administrative expenses in the consolidated statements of operations. The Company's allowance is based on a variety of factors, including the length of time receivables are past due, significant one-time events, the financial health of its customers and historical experience. The allowance for doubtful accounts was $2.7 million as of December 31, 2015. There was no allowance for doubtful accounts as of December 31, 2014. Accounts receivable are written off in the period in which the receivable is deemed uncollectible and collection efforts have been exhausted. There were no write-offs of accounts receivable for the years ended December 31, 2015, 2014 and 2013.

Renewable Energy Facilities

Renewable energy facilities consist of solar generation facilities and wind power plants that are stated at cost. Expenditures for major additions and improvements are capitalized, and minor replacements, maintenance, and repairs are charged to expense as incurred. When renewable energy facilities are retired, or otherwise disposed of, the cost and accumulated depreciation is removed from the consolidated balance sheets and any resulting gain or loss is included in the results of operations for the respective period. Depreciation of renewable energy facilities is recognized using the straight-line method over the estimated useful lives of the renewable energy facilities of 20 to 30 years.

Intangibles

The Company's intangible assets and liabilities represent revenue contracts, consisting of long-term power purchase agreements ("PPAs") and renewable energy certificates ("RECs"), and lease agreements that were obtained through third party acquisitions. The revenue contract intangibles are comprised of favorable and unfavorable rate PPAs and REC agreements and the in-place value of market rate PPAs. The lease agreement intangibles are comprised of favorable and unfavorable rate land leases. Intangible assets and liabilities that have determinable estimated lives are amortized over those estimated lives. Amortization of favorable and unfavorable rate revenue contracts is recorded within operating revenues, net in the consolidated statements of operations. Amortization expense related to the in-place value of market rate revenue contracts is recorded within depreciation, accretion and amortization expense in the consolidated statements of operations, and amortization of favorable and unfavorable rate land leases is recorded within cost of operations. The straight-line method of amortization is used because it best reflects the pattern in which the economic benefits of the intangibles are consumed or otherwise used up. The amounts and useful lives assigned to intangible assets and liabilities acquired impact the amount and timing of future amortization.

Impairment of Long-lived Assets

Long-lived assets that are held and used are reviewed for impairment whenever events or changes in circumstances indicate carrying values may not be recoverable. An impairment loss is recognized if the total future estimated undiscounted cash flows expected from an asset are less than its carrying value. An impairment charge is measured as the difference between an asset's carrying amount and fair value with the difference recorded in operating costs and expenses in the statement of operations. Fair values are determined by a variety of valuation methods, including appraisals, sales prices of similar assets and present value techniques. There were no impairments recognized during the years ended December 31, 2015, 2014 and 2013.

Goodwill

Goodwill represents the excess of the purchase price of acquired businesses over the estimated fair value assigned to the individual assets acquired and liabilities assumed. The Company does not amortize goodwill, but instead evaluates goodwill for impairment at least annually on December 1^st. The Company performs an impairment test between scheduled annual tests if facts and circumstances indicate that it is more-likely-than-not that the fair value of a reporting unit that has goodwill is less than its carrying value.

The Company may first make a qualitative assessment of whether it is more-likely-than-not that a reporting unit’s fair value is less than its carrying value to determine whether it is necessary to perform the two-step quantitative goodwill impairment test. The qualitative impairment test includes considering various factors including macroeconomic conditions, industry and market conditions, cost factors, a sustained share price or market capitalization decrease, and any reporting unit specific events. If it is determined through the qualitative assessment that a reporting unit’s fair value is more-likely-than-not greater than its carrying value, the two-step impairment test is not required. If the qualitative assessment indicates it is more-likely-than-not that a reporting unit’s fair value is not greater than its carrying value, the Company must perform the two-step impairment test. The Company may also elect to proceed directly to the two-step impairment test without considering such qualitative factors.

The first step in the two-step impairment test is the comparison of the fair value of a reporting unit with its carrying amount, including goodwill. The Company has historically defined its reporting units to be consistent with its reportable segments. In accordance with the authoritative guidance over fair value measurements, the Company defines the fair value of a reporting unit as the price that would be received to sell the unit as a whole in an orderly transaction between market participants at the measurement date. The Company primarily uses the income approach methodology of valuation, which includes the discounted cash flow method, and the market approach methodology of valuation, which considers values of comparable businesses to estimate the fair values of the Company's reporting units. The Company does not believe that a cost approach is relevant to measuring the fair values of its reporting units.

Significant management judgment is required when estimating the fair value of the Company's reporting units including the forecasting of future operating results, the discount rates and expected future growth rates that it uses in the discounted cash flow method of valuation, and in the selection of comparable businesses that are used in the market approach. If the estimated fair value of the reporting unit exceeds the carrying value assigned to that unit, goodwill is not impaired and no further analysis is required.

If the carrying value assigned to a reporting unit exceeds its estimated fair value in the first step, then the Company is required to perform the second step of the impairment test. In this step, the Company assigns the fair value of the reporting unit calculated in step one to all of the assets and liabilities of that reporting unit, as if a market participant just acquired the reporting unit in a business combination. The excess of the fair value of the reporting unit determined in the first step of the impairment test over the total amount assigned to the assets and liabilities in the second step of the impairment test represents the implied fair value of goodwill. If the carrying value of a reporting unit’s goodwill exceeds the implied fair value of goodwill, the Company would record an impairment loss equal to the difference.

Capitalized Interest

Interest incurred on funds borrowed to finance construction of renewable energy facilities is capitalized until the system is ready for its intended use. The amount of interest capitalized during the years ended December 31, 2015, 2014 and 2013 was $22.4 million, $19.7 million and $3.6 million, respectively.

Financing Lease Obligations

Certain of the Company's assets were financed with sale-leaseback arrangements. Proceeds received from a sale-leaseback are treated using the deposit method when the sale of the renewable energy facility is not recognizable. A sale is not recognized when the leaseback arrangements include a prohibited form of continuing involvement, such as an option or obligation to repurchase the assets under the Company's master lease agreements. Under these arrangements, the Company does not recognize any profit until the sale is recognizable, which the Company expects will be at the end of the arrangement when the contract is canceled and the initial deposits received are forfeited by the financing party.

Over the course of the leaseback arrangements the Company is required to make rental payments. These payments are allocated between principal and interest payments using an effective yield method.

Deferred Financing Costs

Financing costs incurred in connection with obtaining construction and term financing are deferred and amortized over the maturities of the respective financing arrangements using the effective interest method. Amortization of deferred financing costs is capitalized during construction and recorded as interest expense in the consolidated statements of operations following achievement of commercial operation. There was no amortization of deferred financing costs capitalized during construction for the year ended December 31, 2015. Amortization of deferred financing costs capitalized during construction was $17.6 million and $0.8 million during the years ended December 31, 2014 and 2013, respectively. Amortization of deferred financing costs and debt discounts recorded as interest expense was $27.0 million, $25.8 million and $0.2 million during the years ended December 31, 2015, 2014 and 2013, respectively.

As discussed in Note 10. Long-term debt, the Company experienced defaults under most of its non-recourse financing agreements prior to the issuance of the financial statements for the year ended December 31, 2015. As a result, $17.6 million of deferred financing costs, net were reclassified from long-term assets to current as of December 31, 2015, consistent with the corresponding debt classification. Amortization of deferred financing costs and debt discounts continue to be amortized over the maturities of the respective financing agreements as before the violations, as the Company believes there is a reasonable likelihood that it will be able to successfully negotiate a waiver with the lenders and/or cure the defaults.

Asset Retirement Obligations

The Company operates under PPAs with some customers that include a requirement for the removal of the renewable energy facilities at the end of the term of the agreement. Asset retirement obligations are recognized at fair value in the period in which they are incurred and the carrying amount of the related long-lived asset is correspondingly increased. Over time, the liability is accreted to its expected future value. The corresponding renewable energy facility that is capitalized at inception is depreciated over its useful life.

Revenue Recognition

Power Purchase Agreements

A significant majority of the Company's revenues are obtained through the sale of energy (based on MW) pursuant to terms of PPAs or other contractual arrangements which have a weighted-average remaining life of 16 years as of December 31, 2015. All PPAs are accounted for as operating leases, have no minimum lease payments and rental income under these leases is recorded as revenue when the electricity is delivered.

Incentive Revenue

The Company generates RECs as it produces electricity. These RECs are currently sold pursuant to agreements with SunEdison, unaffiliated third parties and a certain debt holder, and revenue is recognized as the underlying electricity is produced.

The Company also receives performance-based incentives ("PBIs") from public utilities in connection with certain sponsored programs. The Company has a PBI arrangement with the State of California whereby the Company will receive a fixed rate multiplied by the kilowatt hour ("kWh") production on a monthly basis for 60 months. The PBI revenue is recognized as energy is generated over the measurement-period. The Company recognizes revenue based on the rate applicable at the time the energy is created and adjusts the amount recognized when it meets the threshold that qualifies it for the higher rate. PBI in the state of Colorado has a 20-year term at a fixed-price per kWh produced. The revenue is recognized as energy is generated over the term of the agreement.

Deferred Revenue

Deferred revenue consists of upfront incentives or subsidies received from various state governmental jurisdictions for operating certain of the Company's renewable energy facilities or from the sale of investment tax credits to non-controlling members. The amounts deferred are recognized as revenue on a straight-line basis over the depreciable life of the renewable energy facility or upon the contingency of claw-back of the tax credits resolve as the Company fulfills its obligation to operate these renewable energy facilities. Recognition of deferred revenue was $9.9 million, $0.3 million, and $0.2 million during the years ended December 31, 2015, 2014 and 2013, respectively.

Income Taxes

The Company accounts for income taxes using the liability method, which requires that it use the asset and liability method of accounting for deferred income taxes and provides deferred income taxes for all significant temporary differences.

The Company reports certain of its revenues and expenses differently for financial statement purposes than for income tax return purposes, resulting in temporary and permanent differences between the Company's financial statements and income tax returns. The tax effects of such temporary differences are recorded as either deferred income tax assets or deferred income tax liabilities in the Company's consolidated balance sheets. The Company measures its deferred income tax assets and deferred income tax liabilities using income tax rates that are currently in effect. The Company believes it is more likely than not that the results of future operations will generate sufficient taxable income, which includes the future reversal of existing taxable temporary differences to realize deferred tax assets, net of valuation allowances. A valuation allowance is recorded to reduce the net deferred tax assets to an amount that is more-likely-than-not to be realized. Tax benefits are recognized when it is more-likely-than-not that a tax position will be sustained upon examination by the authorities. The benefit recognized from a position that has surpassed the more-likely-than-not threshold is the largest amount of benefit that is more than 50% likely to be realized upon settlement. The Company recognizes interest and penalties accrued related to uncertain tax benefits as a component of income tax expense. Changes to existing net deferred tax assets or valuation allowances or changes to uncertain tax benefits are recorded to income tax expense.

Non-controlling Interests and Hypothetical Liquidation at Book Value ("HLBV")

Non-controlling interests represents the portion of net assets in consolidated entities that are not owned by the Company. The Company has determined the allocation of economics between the controlling party and the third party for non-controlling interests does not correspond to ownership percentages for certain of its consolidated subsidiaries. In order to reflect the substantive profit sharing arrangements, the Company has determined that the appropriate methodology for determining the value of non-controlling interests is a balance sheet approach using the HLBV method.

Under the HLBV method, the amounts reported as non-controlling interest on the consolidated balance sheets represent the amounts the third party investors could hypothetically receive at each balance sheet reporting date based on the liquidation provisions of the respective operating partnership agreements. HLBV assumes that the proceeds available for distribution are equivalent to the unadjusted, stand-alone net assets of each respective partnership, as determined under U.S. GAAP. The third party, non-controlling interests in the consolidated statements of operations and statements of comprehensive loss are determined based on the difference in the carrying amounts of non-controlling interests on the consolidated balance sheets between reporting dates, adjusted for any capital transactions between the Company and third party investors that occurred during the respective period. Non-controlling interests are reported as a component of equity in the consolidated balance sheets.

Where, prior to the commencement of operating activities for a respective renewable energy facility, HLBV results in an immediate change in the carrying value of non-controlling interest on the consolidated balance sheet due to the recognition of ITCs or other adjustments as required by the U.S. Internal Revenue Code, the Company defers the recognition of the respective adjustments and recognizes the adjustments in non-controlling interest on the consolidated statement of operations on a straight-line basis over the expected life of the underlying assets giving rise to the respective difference. Similarly, where the Company has acquired a controlling interest in a partnership and there is a resulting difference between the initial fair value of non-controlling interest and the value of non-controlling interest as measured using HLBV, the Company initially records non-controlling interest at fair value and amortizes the resulting difference over the remaining life of the underlying assets.

Contingencies

The Company is involved in conditions, situations or circumstances in the ordinary course of business with possible gain or loss contingencies that will ultimately be resolved when one or more future events occur or fail to occur. If some amount within a range of loss appears at the time to be a better estimate than any other amount within the range, that amount will be accrued. When no amount within the range is a better estimate than any other amount, however, the minimum amount in the range will be accrued. The Company continually evaluates uncertainties associated with loss contingencies and records a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the financial statements indicates that it is probable that an asset had been impaired or a liability had been incurred at the date of the financial statements; and (ii) the loss or range of loss can be reasonably estimated. Legal costs are expensed when incurred. Gain contingencies are not recorded until realized or realizable.

Derivative Financial Instruments

The Company recognizes its derivative instruments as assets or liabilities at fair value in the consolidated balance sheets. Accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated as part of a hedging relationship and the type of hedging relationship.

The effective portion of changes in fair value of derivative instruments designated as cash flow hedges is reported as a component of other comprehensive income (loss). Changes in the fair value of these derivatives are subsequently reclassified into earnings in the period that the hedged transaction affects earnings. The ineffective portion of changes in fair value is recorded as a component of net loss on the consolidated statements of operations. There was no ineffectiveness during the years ended December 31, 2015, 2014 and 2013.

The change in fair value of undesignated derivative instruments is reported as a component of net loss on the consolidated statements of operations.

Fair Value Measurements

The Company performs fair value measurements defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities required to be recorded at their fair values, the Company considers the principal or most advantageous market in which it would transact and considers assumptions that market participants would use when pricing the assets or liabilities, such as inherent risk, transfer restrictions and risk of nonperformance.

In determining fair value measurements, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs. Assets and liabilities are categorized within a fair value hierarchy based upon the lowest level of input that is significant to the fair value measurement:


•	Level 1: Quoted prices in active markets for identical assets or liabilities;

•

Level 2: Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices in active markets for similar assets or liabilities, quoted prices for identical or similar assets or liabilities in markets that are not active, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; or


•	Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair values of the assets or liabilities.

The Company maintains various financial instruments recorded at cost in the December 31, 2015 and 2014 consolidated balance sheets that are not required to be recorded at fair value. For cash and cash equivalents, restricted cash, accounts receivable, prepaid expenses and other current assets, accounts payable, accrued expenses and other current liabilities, and due to SunEdison, net, the carrying amount approximates fair value because of the short-term maturity of the instruments. See Note 13. Fair Value of Financial Instruments for disclosures related to the fair value of the Company's derivative instruments and long-term debt.

Foreign Operations

The Company's reporting currency is the U.S. dollar. Certain of the Company's subsidiaries maintain their records in local currencies other than the U.S. dollar, which are their functional currencies. When a subsidiary’s local currency is considered its functional currency, the Company translates its assets and liabilities to U.S. dollars using exchange rates in effect at the balance sheet date, and its revenue and expense accounts to U.S. dollars at average exchange rates for the period. Translation adjustments are reported in accumulated other comprehensive income (loss) in stockholders’ equity. Transaction gains and losses and changes in fair value of the Company's foreign exchange derivative contracts not accounted for under hedge accounting are included in results from operations as incurred. Loss (gain) on foreign currency exchange, net was $19.5 million, $14.0 million and $(0.8) million during the years ended December 31, 2015, 2014 and 2013, respectively, as reported in the consolidated statements of operations.

Business Combinations

The Company accounts for its business combinations by recognizing in the financial statements the identifiable assets acquired, the liabilities assumed, and any non-controlling interests in the acquiree at fair value at the acquisition date. The Company also recognizes and measures the goodwill acquired or a gain from a bargain purchase in the business combination and determines what information to disclose to enable users of an entity's financial statements to evaluate the nature and financial effects of the business combination. In addition, acquisition costs related to business combinations are expensed as incurred.

When the Company acquires renewable energy facilities, the purchase price is allocated to (i) the acquired tangible assets and liabilities assumed, primarily consisting of land, plant, and long-term debt, (ii) the identified intangible assets and liabilities, consisting of the value of favorable and unfavorable rate PPAs and REC agreements and the in-place value of market rate PPAs, (iii) non-controlling interests, and (iv) other working capital items based in each case on their fair values.

The Company generally uses independent appraisers to assist with the estimates and methodologies used such as a replacement cost approach, or an income approach or excess earnings approach. Factors considered by the Company in its analysis include considering current market conditions and costs to construct similar facilities. The Company also considers information obtained about each facility as a result of its pre-acquisition due diligence in estimating the fair value of the tangible and intangible assets and liabilities acquired or assumed. In estimating the fair value, the Company also establishes estimates of energy production, current in-place and market power purchase rates, tax credit arrangements, and operating and maintenance costs. A change in any of the assumptions above, which are subjective, could have a significant impact on the results of operations.

The allocation of the purchase price directly affects the following items in the consolidated financial statements:


•	The amount of purchase price allocated to the various tangible and intangible assets, liabilities, and non-controlling interests on the balance sheet;


•	The amounts allocated to the value of favorable and unfavorable rate PPAs and REC agreements are amortized to revenue over the remaining non-cancelable terms of the respective arrangement. The amounts allocated to all other tangible and intangible assets are amortized to depreciation or amortization expense; and

•

The period of time over which tangible and intangible assets are depreciated or amortized varies, and thus, changes in the amounts allocated to these assets will have a direct impact on the Company's results of operations. Intangible assets are generally amortized over the remaining respective life of the revenue contract, which normally range from 10 to 25 years. The Company depreciates its renewable energy facilities over the estimated useful lives of the facilities of 20 to 30 years. These differences in timing could have an impact on the Company's results of operations.

Basic and Diluted Loss Per Share

Basic loss per share is computed by dividing net loss attributable to Class A common stockholders by the number of weighted-average ordinary shares outstanding during the period. Diluted loss per share is computed by adjusting basic loss per share for the impact of weighted-average dilutive common equivalent shares outstanding during the period. Common equivalent shares represent the incremental shares issuable for unvested restricted Class A common stock and redeemable shares of Class B and Class B1 common stock.

Stock-Based Compensation

Stock-based compensation expense for all share-based payment awards to employees who provide services to the Company is based on the estimated grant-date fair value. The Company recognizes these compensation costs net of an estimated forfeiture rate for only those shares expected to vest on a straight-line basis over the requisite service period of the award, which is generally the award vesting term. For ratable awards, the Company recognizes compensation costs for all grants on a straight-line basis over the requisite service period of the entire award.

Assets Held for Sale

The Company records assets held for sale at the lower of the carrying value or fair value less costs to sell. The following criteria are used to determine if property is held for sale: (i) management has the authority and commits to a plan to sell the property; (ii) the property is available for immediate sale in its present condition; (iii) there is an active program to locate a buyer and the plan to sell the property has been initiated; (iv) the sale of the property is probable within one year; (v) the property is being actively marketed at a reasonable price relative to its current fair value; and (vi) it is unlikely that the plan to sell will be withdrawn or that significant changes to the plan will be made.

In determining the fair value of the assets less cost to sell, the Company considers factors including current sales prices for comparable assets in the region, recent market analysis studies, appraisals and any recent legitimate offers. If the estimated fair value less cost to sell of an asset is less than its current carrying value, the asset is written down to its estimated fair value less cost to sell. Due to uncertainties in the estimation process, it is reasonably possible that actual results could differ from the estimates used in the Company's historical analysis. The Company's assumptions about project sale prices require significant judgment because the current market is highly sensitive to changes in economic conditions. The Company estimates the fair values of assets held for sale based on current market conditions and assumptions made by management, which may differ from actual results and may result in additional impairments if market conditions deteriorate.

New Accounting Standards

In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. ASU No. 2014-09 will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective. ASU No. 2014-09 will become effective for the Company on January 1, 2018. Early application is permitted but not before January 1, 2017. ASU No. 2014-09 permits the use of either the retrospective or cumulative effect transition method. The Company is currently evaluating the effect that ASU No. 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method or determined the effect of ASU No. 2014-09 on its ongoing financial reporting.

In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810) Amendments to the Consolidation Analysis, which affects the following areas of the consolidation analysis: limited partnerships and similar entities, evaluation of fees paid to a decision maker or service provider as a variable interest and in determination of the primary beneficiary, effect of related parties on the primary beneficiary determination and for certain investment funds. ASU No. 2015-02 is effective for the Company for the fiscal year ending December 31, 2016 and interim periods therein. We evaluated the impact of ASU No. 2015-02 on our consolidated financial statements, which resulted in certain of our consolidated subsidiaries to be considered variable interest entities. No unconsolidated investments are expected to be consolidated and no consolidated subsidiaries are expected to be deconsolidated as a result of implementing this standard.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30) Simplifying the Presentation of Debt Issuance Costs, which requires debt issuance costs related to a recognized debt liability to be presented on the balance sheet as a direct deduction from the carrying amount of that debt liability. In August 2015, the FASB issued ASU No. 2015-15 Interest - Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, in which an entity may defer and present debt issuance costs associated with line-of-credit arrangements as an asset and subsequently amortize the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. ASU No. 2015-03 and ASU No. 2015-15 are effective on a retrospective basis for annual and interim periods beginning on or after December 15, 2015. Early adoption is permitted, but only for debt issuance costs that have not been reported in financial statements previously issued or available for issuance. The effect of implementing this ASU is expected to be limited to a reclassification of debt issuance costs classified as an asset to debt.

In April 2015, the FASB issued ASU No. 2015-06, Earnings Per Share, which provides guidance on the presentation of historical earnings per unit under the two-class method for transfers of net assets between entities under common control. ASU No. 2015-06 is effective for the Company for the fiscal year ending December 31, 2016 and interim periods therein. The Company's accounting policies for earning per share are consistent with the guidance in ASU No. 2015-06, therefore, there is no effect of ASU No. 2015-06 on its consolidated financial statements.

In September 2015, the FASB issued ASU No. 2015-16, Business Combinations (Topic 805): Simplifying the Accounting for Measurement-Period Adjustments, which eliminates the requirement for an acquirer in a business combination to account for measurement-period adjustments retrospectively. Instead, acquirers must recognize measurement-period adjustments during the period in which they determine the amounts, including the effect on earnings of any amounts they would have recorded in previous periods if the accounting had been completed at the acquisition date. ASU No. 2015-16 is effective for the Company on a prospective basis on January 1, 2016. Early adoption is permitted for any interim and annual financial statements that have not yet been made available for issuance. The Company early adopted ASU No. 2015-16 effective December 31, 2015, which did not have a material impact on the Company's consolidated financial statements.

In November 2015, the FASB issued ASU No. 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes, instructing reporting entities to classify deferred income taxes as non-current on the consolidated balance sheets. Deferred income taxes were previously required to be classified as current or non-current on the consolidated balance sheets. The provisions of ASU No. 2015-17 are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2016. Early adoption is permitted for any interim and annual financial statements that have not yet been made available for issuance. A reporting entity should apply the amendment prospectively or retrospectively. The Company has early adopted ASU No. 2015-17 effective December 31, 2015 using the prospective method allowed under the standard and thus prior periods were not retrospectively restated. There would have been no impact due to ASU No. 2015-17 on the Company's consolidated financial statements as of December 31, 2014.

In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842), which primarily changes the lessee's accounting for operating leases by requiring recognition of lease right-of-use assets and lease liabilities. This standard is effective for annual reporting periods beginning after December 15, 2018, with early adoption permitted. The Company is currently evaluating the effect of ASU No. 2016-02 on its consolidated financial statements.

In March 2016, the FASB issued ASU 2016-09, Compensation - Stock Compensation (Topic 718). This update was issued as part of the FASB's simplification initiative and affects all entities that issue share-based payment awards to their employees. The amendments in this update cover such areas as the recognition of excess tax benefits and deficiencies, the classification of those excess tax benefits on the statement of cash flows, an accounting policy election for forfeitures, the amount an employer can withhold to cover income taxes and still qualify for equity classification and the classification of those taxes paid on the statement of cash flows. This update is effective for annual and interim periods beginning after December 31, 2016, which will require the Company to adopt these provisions in the first quarter of fiscal 2018. This guidance will be applied either prospectively, retrospectively or using a modified retrospective transition method, depending on the area covered in this update. Early adoption is permitted. The Company has not yet selected a transition date nor has it determined the effect of the standard on its ongoing financial reporting.

In March 2016, the FASB issued ASU No. 2016-07, Investments - Equity Method and Joint Ventures (Topic 323). The amendments of ASU No. 2016-07 eliminate the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The amendments require that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor's previously held interest and adopt the equity method of accounting with no retroactive adjustment to the investment. In addition, ASU No. 2016-07 requires that an entity that has an available-for-sale equity security that becomes qualified for the equity method of accounting recognize through earnings the unrealized holding gain or loss in accumulated other comprehensive income at the date the investment becomes qualified for use of the equity method. The guidance in ASU No. 2016-07 is effective for fiscal years beginning after December 15, 2016, and interim periods within those annual periods. The adoption of ASU No. 2016-07 is required to be applied prospectively and early adoption is permitted. The Company does not expect the standard to have a material impact on its consolidated financial statements.

In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230), Classification of Certain Cash Receipts and Cash Payments. The amendments of ASU No. 2016-15 were issued to address eight specific cash flow issues for which stakeholders have indicated to the FASB that a diversity in practice existed in how entities were presenting and classifying these items in the statement of cash flows. The issues addressed by ASU No. 2016-15 include but are not limited to the classification of debt prepayment and debt extinguishment costs, payments made for contingent consideration for a business combination, proceeds from the settlement of insurance proceeds, distributions received from equity method investees and separately identifiable cash flows and the application of the predominance principle. The amendments of ASU No. 2016-15 are effective for public entities for fiscal years beginning after December 15, 2017 and interim periods in those fiscal years. Early adoption is permitted, including adoption in an interim fiscal period with all amendments adopted in the same period. The adoption of ASU No. 2016-15 is required to be applied retrospectively. The Company is currently evaluating the impact of the standard on its consolidated statements of cash flows.

In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory. The amendments of ASU No. 2016-16 were issued to improve the accounting for the income tax consequences of intra-entity transfers of assets other than inventory. Current GAAP prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party which has resulted in diversity in practice and increased complexity within financial reporting. The amendments of ASU No. 2016-16 would require an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs and do not require new disclosure requirements. The amendments of ASU No. 2016-16 are effective for annual reporting periods beginning after December 15, 2017, and interim periods within those annual periods. Early adoption is permitted and the adoption of ASU No. 2016-16 should be applied on a modified retrospective basis through a cumulative-effect adjustment directly to retained earnings as of the beginning of the period of adoption. The Company is currently evaluating the impact of the standard on its consolidated financial statements.

Transactions Between Entities Under Common Control

12 Months Ended

Dec. 31, 2015

Transactions Between Entities Under Common Control

TRANSACTIONS BETWEEN ENTITIES UNDER COMMON CONTROL

Recast of Historical Financial Statements

During the year ended December 31, 2015, the Company acquired renewable energy facilities with a combined nameplate capacity of 573.5 MW from SunEdison, which resulted in a recast of the consolidated balance sheet as of December 31, 2014 and the consolidated statement of cash flows for the years ended December 31, 2014 and 2013, as disclosed below. One of these facilities has been in operation since 2010, which resulted in a recast of the consolidated statement of operations and consolidated statement of comprehensive loss for the years ended December 31, 2014 and 2013 as reported in the Company's Current Report on Form 8-K dated September 4, 2015.

The following table presents changes to the Company's previously reported consolidated balance sheet as of December 31, 2014 included in the Company's Current Report on Form 8-K dated September 4, 2015:



(In thousands) Balance Sheet Caption	As Previously Recasted		Recast Adjustments		As Recasted
Renewable energy facilities, net	$	2,637,139	$	11,073	$	2,648,212
Change in total assets			$	11,073

Current portion of long-term debt and financing lease obligations	$	97,412	$	3,076	$	100,488
Due to SunEdison, net	186,435		7,997		194,432
Change in total liabilities			$	11,073

The following table presents changes to the Company's previously reported consolidated statement of cash flows for the year ended December 31, 2014 included in the Company's Current Report on Form 8-K dated September 4, 2015:



(In thousands) Statement of Cash Flows Caption	As Previously Recasted			Recast Adjustments			Correction of Previously Recasted Amounts¹			As Recasted
Cash flows from investing activities:
Cash paid to third parties for renewable energy facility construction	$	(1,137,275	)	$	(10,135	)	$	25,117		$	(1,122,293	)
Change in net cash used in investing activities				(10,135		)	25,117

Cash flows from financing activities:
Borrowings of non-recourse long-term debt	472,444			3,076			(3,597		)	471,923
Principal payments on non-recourse long-term debt²	(338,070		)	—			(3,121		)	(341,191		)
Due to SunEdison, net	210,967			7,059			(18,657		)	199,369
Change in net cash provided by financing activities				10,135			(25,375		)

Net increase in cash and cash equivalents	467,940			—			(258		)	467,682
Effect of exchange rate changes on cash and cash equivalents	(430		)	—			258			(172		)
Cash and cash equivalents at beginning of period	1,044			—			—			1,044
Cash and cash equivalents at end of period	$	468,554		$	—		$	—		$	468,554

————

(1)

During the fourth quarter of 2015, the Company identified a classification error in the amounts that were previously recasted in the Company's consolidated statement of cash flows for the year ended December 31, 2014 and has corrected the error as shown in the table above. This classification error did not have an impact on the Company's recasted consolidated statement of operations for the year ended December, 31, 2014, the consolidated balance sheet as of December 31, 2014 and did not impact cash and cash equivalents as of December 31, 2014 and 2013.

(2)

There is a $1.5 million difference between the previously recasted amount per the table above and the principal payments on long-term debt amount reported in the Company's Current Report on Form 8-K dated September 4, 2015 as the amount relates to a principal payment for the Company's Term Loan which is separately reported from principal payments on non-recourse long-term debt within cash flows from financing activities in the consolidated statement of cash flows within this Form 10-K.

The following table presents changes to the Company's previously reported consolidated statement of cash flows for the year ended December 31, 2013 included in the Company's Current Report on Form 8-K dated September 4, 2015:



(In thousands) Statement of Cash Flows Caption	As Previously Recasted			Recast Adjustments			Correction of Previously Recasted Amounts¹			As Recasted
Cash flows from operating activities:
Changes in assets and liabilities:
Due to SunEdison, net	$	24,291		$	—		$	(5,426	)	$	18,865
Change in net cash used in operating activities				—			(5,426		)

Cash flows from investing activities:
Cash paid to third parties for renewable energy facility construction	(208,850		)	(938		)	(572		)	(210,360		)
Change in net cash used in investing activities				(938		)	(572		)

Cash flows from financing activities:
Borrowings of non-recourse long-term debt	303,442			—			1,287			304,729
Principal payments on non-recourse long-term debt	(4,641		)	—			(1,287		)	(5,928		)
Due to SunEdison, net	—			938			5,998			6,936
Change in net cash provided by financing activities				938			5,998

Net increase in cash and cash equivalents	1,041			—			—			1,041
Effect of exchange rate changes on cash and cash equivalents	—			—			—			—
Cash and cash equivalents at beginning of period	3			—			—			3
Cash and cash equivalents at end of period	$	1,044		$	—		$	—		$	1,044

————

(1)

During the fourth quarter of 2015, the Company identified a classification error in the amounts that were previously recasted in the Company's consolidated statement of cash flows for the year ended December 31, 2013 and has corrected the error as shown in the table above. This classification error did not have an impact on the Company's recasted consolidated statement of operations for the year ended December, 31, 2013, the consolidated balance sheet as of December 31, 2013 and did not impact cash and cash equivalents as of December 31, 2013 and 2012.

Acquisitions of Renewable Energy Facilities from SunEdison

The assets and liabilities transferred to the Company for the acquisitions of renewable energy facilities relate to interests under common control with SunEdison, and accordingly, have been recorded at historical cost. The difference between the cash purchase price and historical cost of the net assets acquired has been recorded as a contribution from SunEdison.

The following table summarizes the renewable energy facilities acquired by the Company from SunEdison through a series of transactions:



			Year Ended December 31, 2015				As of December 31, 2015
Facility Category	Type	Location	Nameplate Capacity (MW)	Number of Sites	Initial Cash Paid¹		Cash Due to SunEdison²		Debt Assumed³		Debt Transferred⁴
Distributed Generation	Solar	U.S.	91.5	74	$	155,573	$	2,600	$	—	$	—
Residential	Solar	U.S.	12.9	1,806	25,053		—		—		—
Utility	Solar	U.S.	54.8	9	69,868		14,341		—		14,475
Utility	Solar	U.K.	214.3	14	150,595		—		205,587		—
Utility	Wind	U.S.	200.0	1	127,000		—		—		—
Total			573.5	1,904	$	528,089	$	16,941	$	205,587	$	14,475

————


(1)	Represents the amount paid to SunEdison on the date of acquisition of renewable energy facilities from SunEdison. Excludes aggregated tax equity partner payments of $363.6 million to SunEdison.

(2)

Represents commitments by the Company to SunEdison for the amount required for SunEdison to complete the construction of renewable energy facilities acquired from SunEdison, which was paid to SunEdison during the first quarter of 2016. This commitment is not recorded on the Company's balance sheet as of December 31, 2015 (see Note 19. Related Parties) and excludes tax equity partner payments of $9.2 million due to SunEdison.


(3)	Represents debt that was assumed by the Company as of the acquisition date of these facilities which was subsequently refinanced on November 6, 2015 (see Note 10. Long-term debt).


(4)	Represents debt recorded on the Company's balance sheet as of December 31, 2015. This debt was repaid by SunEdison during the first quarter of 2016 using cash proceeds paid by the Company and the tax equity partner to SunEdison for the acquisition of these facilities.

During the year ended December 31, 2015, the Company paid $503.9 million to SunEdison for the acquisition of renewable energy facilities that had achieved commercial operations as of December 31, 2015. The difference between the cash paid and historical cost of the net assets acquired from SunEdison for the year ended December 31, 2015 of $41.8 million has been recorded as a contribution from SunEdison, which is reflected within Net SunEdison investment on the consolidated statement of stockholders' equity. Additionally, during the year ended December 31, 2015, the Company paid $24.2 million to SunEdison for facilities acquired from SunEdison that had not achieved commercial operations as of December 31, 2015.

Results of Operations

The following table is a summary of the results of operations for the renewable energy facilities acquired by the Company from SunEdison during the years ended December 31, 2015, 2014 and 2013:



	Year Ended December 31,
(In thousands)	2015			2014			2013
Operating revenues, net	$	37,629		$	1,292		$	1,247
Operating expenses	39,527			1,017			1,015
Operating (loss) income	(1,898		)	275			232
Interest expense, net	5,575			1,773			1,862
Other non-operating income, net	(3,582		)	—			—
Net loss	$	(3,891	)	$	(1,498	)	$	(1,630	)

Acquisitions

12 Months Ended

Dec. 31, 2015

Acquisitions

ACQUISITIONS

2015 Acquisitions

Acquisition of First Wind

On January 29, 2015, the Company, through Terra LLC, acquired from First Wind Holdings, LLC (together with its subsidiaries, “First Wind”) operating renewable energy facilities that have a combined nameplate capacity of 521.1 MW, including 500.0 MW of wind power plants and 21.1 MW of solar generation facilities (the “First Wind Acquisition”). The operating renewable energy facilities the Company acquired are located in Maine, New York, Hawaii, Vermont and Massachusetts and are contracted under PPAs including energy hedges contracts. Certain of the renewable energy facilities also receive revenue from RECs. The cash purchase price for this acquisition was $811.6 million, net of cash acquired.

During the year-ended December 31, 2015, the Company acquired an operating wind facility located in Texas and seven solar generation facilities located in Utah from SunEdison with a combined nameplate capacity of 222.6 MW. These facilities were initially acquired by SunEdison from First Wind on January 29, 2015. The purchase price paid by SunEdison to the third-party for these facilities was $168.4 million, net of cash acquired. The acquisitions were treated as transactions between entities under common control and as a result the acquisition accounting as of January 29, 2015 by SunEdison has been reflected in these consolidated financial statements.

Acquisition of Northern Lights Solar Generation Facilities

On June 30, 2015, the Company acquired two utility-scale, ground mounted solar generation facilities ("Northern Lights") from Invenergy Solar LLC. The facilities are located in Ontario, Canada and have a combined nameplate capacity of 25.4 MW. The facilities are contracted under long-term PPAs with an investment grade utility with a credit rating of Aa2. The purchase price for this acquisition was 125.4 million Canadian Dollars ("CAD") (equivalent of $101.1 million), net of cash acquired, including the repayment of project-level debt and breakage fees for the termination of interest rate swaps.

Acquisition of Invenergy Wind Power Plants

On December 15, 2015, the Company acquired operating wind power plants with a combined nameplate capacity of 831.5 MW (net) from Invenergy Wind Global LLC (together with its subsidiaries, “Invenergy Wind”) for $1.3 billion in cash and the assumption of $531.2 million of non-recourse indebtedness. The wind power plants that the Company acquired from Invenergy Wind have contracted PPAs with an average counterparty credit rating of AA. Invenergy Wind will retain a 9.9% non-controlling interest in wind power plants located in the U.S. that the Company acquired and will provide certain operation and maintenance services for such assets.

Acquisition of Integrys Solar Generation Facilities

During the year ended December 31, 2015, the Company acquired 56 solar generation facilities with a combined nameplate capacity of 32.0 MW (net) from Integrys Group, Inc. ("Integrys") for a purchase price of $70.7 million, net of cash acquired, and $15.9 million of project-level debt assumed. The facilities are located in Arizona, California, Connecticut, Massachusetts, New Jersey and Pennsylvania. The facilities are contracted under long-term PPAs with commercial and municipal customers.

Acquisition of Other Solar Generation Facilities

During the year-ended December 31, 2015, the Company acquired two solar generation facilities from SunEdison with a combined nameplate capacity of 38.8 MW. These facilities were initially acquired by SunEdison through other unaffiliated third parties during the year-ended December 31, 2015. The purchase price paid by SunEdison to the third parties for these acquisitions were $18.9 million, net of cash acquired. The acquisitions were treated as transactions between entities under common control and as a result the acquisition accounting by SunEdison has been reflected in these consolidated financial statements.

During the year ended December 31, 2015, the Company acquired 10 solar generation facilities with a combined nameplate capacity of 3.8 MW for a purchase price of $19.9 million, net of cash acquired. The facilities are located in Ontario, Canada.

Initial Accounting for the 2015 Acquisitions

The acquisition accounting for the First Wind, Northern Lights, Integrys, and other solar generation facilities acquisitions was completed as of the fourth quarter of 2015, at which point the provisional fair values became final.

The final fair value of assets, liabilities, and non-controlling interest pertaining to the First Wind acquisition reflects the following changes from the initial opening balance sheet: an increase of $1.1 million in cash, an increase of $20.7 million in accounts receivable, a decrease of $7.6 million in renewable energy facilities, an increase of $0.6 million in restricted cash, a decrease of $18.0 million in other assets, a decrease of $12.4 million in long-term debt, an increase of $7.5 million in asset retirement obligations, an increase of $18.6 million in other long-term liabilities and a decrease of $21.2 million in non-controlling interest.

The final fair value of assets and liabilities pertaining to the Northern Lights acquisition reflects the following changes from the initial opening balance sheet; a decrease of $13.2 million in renewable energy facilities and an increase of $13.2 million in intangible assets.

The final fair value of assets, liabilities, and non-controlling interest pertaining to the Integrys acquisition reflects the following changes from the initial opening balance sheet; an increase of $1.3 million in renewable energy facilities, an increase of $5.7 million in intangible assets, an increase of $0.9 million in asset retirement obligations, an increase of $5.8 million in other long-term liabilities, and an increase of $0.3 million in non-controlling interest.

The final fair value of assets and liabilities pertaining to other solar generation facilities acquisitions reflects the following changes from the initial opening balance sheet; a decrease of $4.4 million in renewable energy facilities and an increase of $4.2 million in intangible assets.

The final accounting for the Invenergy Wind acquisition has not been completed because the evaluation necessary to assess the fair values of certain net assets acquired is still in process. The provisional amounts for the Invenergy Wind acquisition, included in the table within the "Acquisition Accounting" section of this footnote below, are subject to revision until these evaluations are completed.

The operating revenues and net loss of the facilities acquired in 2015 reflected in the consolidated statements of operations for the year ended December 31, 2015 are $161.1 million and $8.8 million, respectively.

2014 Acquisitions

During the year ended December 31, 2014, the Company acquired various facilities referred to as Mt. Signal, Stonehenge Operating Projects, Capital Dynamics and Hudson Energy, as well as various other renewable energy facilities. The acquisition accounting for Mt. Signal, Stonehenge Operating Projects and various other 2014 acquisitions were finalized during 2015.

The acquisition accounting for the Capital Dynamics facilities was completed as of the fourth quarter of 2015, at which point the provisional fair values became final. The final fair value of assets, liabilities, and non-controlling interest pertaining to Capital Dynamics reflect the following changes from the initial opening balance sheet: a decrease of $10.4 million in renewable energy facilities, an increase of $3.8 million in accounts receivable, an increase of $55.9 million in goodwill, a decrease of $8.9 million in intangible assets, an increase of $22.1 million in net deferred tax liabilities, an increase of $6.3 million in asset retirement obligations, an increase of $12.1 million in other long-term liabilities and an increase of $3.6 million in non-controlling interest.

The acquisition accounting for the Hudson Energy facilities was completed as of the fourth quarter of 2015, at which point the provisional fair values became final. The final fair value of assets, liabilities, and non-controlling interest pertaining to Hudson reflect the following changes from the initial opening balance sheet: an increase of $4.4 million in renewable energy facilities, an increase in other long-term assets of $4.9 million, a decrease of $9.2 million in intangibles, an increase of $5.2 million in other long-term liabilities and a decrease of $5.7 million in non-controlling interest.

Goodwill

Goodwill is recorded as the difference between the aggregate consideration paid for an acquisition and the fair value of the net tangible and identified intangible assets acquired. During 2015, the Company recorded $55.9 million of goodwill attributable to the acquisition of Capital Dynamics, which provided the Company with a distributed generation platform. The goodwill exists within the Company's Distributed Generation reporting unit within the solar reportable segment. The goodwill is not deductible for federal income tax purposes.

Valuation of Non-controlling Interest

First Wind

The majority of the fair value of the non-controlling interest was determined using a market approach using a quoted price for the instrument. Upon the acquisition of the First Wind assets, the Company purchased a portion of the equity interest from the non-controlling interest holders of one of the joint venture investment funds. The quoted price for the purchase of a portion of the non-controlling interest is the best indicator of fair value and was supported by a discounted cash flow technique. The Company estimated the fair value of the remainder of the non-controlling interest balances using a discounted cash flow approach.

Invenergy Wind

The fair value of the non-controlling interest for Invenergy Wind was determined using a discounted cash flow approach. The redeemable non-controlling interest represents the fair value of 9.9% sponsor equity held by Invenergy Wind.

Sun Edison LLC, a wholly owned subsidiary of SunEdison, acting as intermediary, entered into certain option arrangements with Invenergy Wind for its remaining 9.9% interest in the Acquired Companies (the ‘‘Invenergy Wind Interest’’). Simultaneously, Terra LLC entered into a back to back option agreement with Sun Edison LLC on substantially identical terms (collectively the "Option Agreements"). The Option Agreements effectively permit (i) Terra LLC to exercise a call option to purchase the Invenergy Wind Interest over a 180-day period beginning on September 30, 2019, and (ii) Invenergy Wind to exercise a put option with respect to the Invenergy Wind Interest over a 180-day period beginning on September 30, 2018. The exercise prices of the put and call options described above would be based on the determination of the fair market value of the Invenergy Wind Interest at the time the relevant option is exercised, subject to certain minimum and maximum thresholds set forth in the Option Agreements. Sun Edison LLC is a debtor in the SunEdison Bankruptcy. As such, Sun Edison LLC may assume, assume and assign or reject its Option Agreement. If Sun Edison LLC rejects its Option Agreement, the Company would not expect to be obligated to perform on its Option Agreement, although the Company cannot assure that result.

Acquisition Accounting

The estimated acquisition-date fair values of assets, liabilities and non-controlling interests pertaining to business combinations as of December 31, 2015, are as follows:



	2015 Preliminary		2015 Final										2014 Final
(In thousands)	Invenergy Wind		First Wind		Other First Wind¹		Northern Lights		Integrys		Other		Mt. Signal		Capital Dynamics		Other
Renewable energy facilities in service	$	1,486,746	$	795,462	$	—	$	62,018	$	69,935	$	7,931	$	649,570	$	190,352	$	256,912
Construction in progress - renewable energy facilities	—		—		264,858		—		—		28,878		—		—		—
Accounts receivable	25,811		30,031		—		1,361		2,610		—		11,687		8,331		9,906
Intangible assets	748,300		123,600		—		39,000		28,966		12,454		119,767		74,236		120,624
Goodwill	—		—		—		—		—		—		—		55,874		—
Deferred income taxes	—		—		—		—		—		—		—		—		—
Restricted cash	31,247		7,240		60		—		827		—		22,165		15		14,720
Derivative assets	32,311		44,755		—		—		—		—		—		—		—
Other assets	12,070		5,873		—		11		234		200		12,621		348		9,552
Total assets acquired	2,336,485		1,006,961		264,918		102,390		102,572		49,463		815,810		329,156		411,714
Accounts payable, accrued expenses and other current liabilities	23,195		9,854		442		440		409		1,854		22,725		1,478		3,016
Long-term debt, including current portion	531,221		47,400		72,881		—		15,882		—		413,464		—		136,156
Deferred income taxes	242		—		—		—		—		—		—		25,129		927
Asset retirement obligations	47,346		19,890		—		818		5,730		509		4,656		13,073		17,374
Other long-term liabilities	6,004		18,562		23,237		—		5,786		—		—		12,100		5,242
Total liabilities assumed	608,008		95,706		96,560		1,258		27,807		2,363		440,845		51,780		162,715
Redeemable non-controlling interest	141,415		3,076		—		—		—		8,298		—		20,194		2,250
Non-controlling interest	308,000		96,624		—		—		4,045		—		83,310		—		2,000
Purchase price, net of cash acquired	$	1,279,062	$	811,555	$	168,358	$	101,132	$	70,720	$	38,802	$	291,655	$	257,182	$	244,749

————


(1)	Represents renewable energy facilities with a combined nameplate capacity of 222.6 MW acquired from SunEdison during the year ended December 31, 2015. These facilities were acquired by SunEdison from First Wind on January 29, 2015.

The estimated acquisition-date fair values of assets, liabilities and non-controlling interests pertaining to business combinations as of December 31, 2014, were as follows:



	Capital				Other
(In thousands)	Dynamics		Mt. Signal		Acquisitions
Renewable energy facilities in service	$	200,712	$	649,005	$	245,828
Accounts receivable	4,511		11,617		11,251
Intangible assets	83,114		117,925		140,248
Deferred income taxes	22,129		—		—
Restricted cash	15		22,165		14,688
Other assets	687		12,621		4,987
Total assets acquired	311,168		813,333		417,002
Accounts payable, accrued expenses and other current liabilities	5,925		24,813		7,410
Long-term debt, including current portion	—		413,464		137,472
Deferred income taxes	25,191		—		892
Asset retirement obligations	6,749		4,656		18,058
Total liabilities assumed	37,865		442,933		163,832
Redeemable non-controlling interest	16,600		—		7,738
Non-controlling interest	—		78,745		2,175
Purchase price, net of cash acquired	$	256,703	$	291,655	$	243,257

The acquired renewable energy facilities' non-financial assets and other long-term liabilities represent estimates of the fair value of acquired PPA and REC contracts based on significant inputs that are not observable in the market and thus represent a Level 3 measurement (as defined in Note 13. Fair Value of Financial Instruments). The estimated fair values were determined based on an income approach. Refer below for additional disclosures related to the acquired intangibles.

2015 Acquisitions - Intangibles at Acquisition Date

The following table summarizes the fair value and weighted average amortization period of acquired intangible assets and liabilities as of the acquisition date for transactions closed during 2015.



	Fair Value
(In thousands)	Invenergy Wind	First Wind	Northern Lights	Integrys	Other
Intangible assets
Favorable rate revenue contracts	550,000	3,900	39,000	21,168	12,454
In-place value of market rate revenue contracts	198,300	103,900	—	7,798	—
Favorable rate land leases	—	15,800	—	—	—
Intangible liabilities
Unfavorable rate revenue contracts	—	17,200	—	5,786	—
Unfavorable rate land lease	—	1,000	—	—	—

	Weighted Average Amortization Period¹
(In years)	Invenergy Wind	First Wind	Northern Lights	Integrys	Other
Intangible assets
Favorable rate revenue contracts	17	3	18	12	20
In-place value of market rate revenue contracts	21	18	—	22	—
Favorable rate land leases	—	20	—	—	—
Intangible liabilities
Unfavorable rate revenue contracts	—	6	—	19	—
Unfavorable rate land lease	—	18	—	—	—

————

(1) For purposes of this disclosure, the weighted average amortization period is determined based on a weighting of the individual intangible fair values against the total fair value for each major intangible asset and liability class.

2014 Acquisitions - Intangibles at Acquisition Date

The following table summarizes the fair value and weighted average amortization period of acquired intangible assets and liabilities as of the acquisition date for transactions closed during 2014. The fair values in the table below reflect the final acquisition accounting balances. The preliminary acquisition accounting as of December 31, 2014 reflected all intangible values as favorable rate revenue contracts with the exception of Mt. Signal, which was valued as an in-place market rate revenue contract.



	Fair Value
(In thousands)	Mt. Signal	Capital Dynamics	Other
Intangible assets
Favorable rate revenue contracts	—	26,000	70,179
In-place value of market rate revenue contracts	119,767	48,236	50,445
Intangible liabilities
Unfavorable rate revenue contracts	—	12,100	—

	Weighted Average Amortization Period¹
(In years)	Mt. Signal	Capital Dynamics	Other
Intangible assets
Favorable rate revenue contracts	—	18	19
In-place value of market rate revenue contracts	25	23	15
Intangible liabilities
Unfavorable rate revenue contracts	—	7	—

————

Pending Acquisitions

Acquisition of Wind Power Plants from Invenergy Wind

At the time the Company entered into an acquisition agreement for the Invenergy assets acquired on December 15, 2015, the Company also agreed to purchase two additional wind facilities from Invenergy Wind in a second closing, subject to customary closing conditions, including the consent of the tax equity finance parties for the wind power plants. The facilities have a combined nameplate capacity of 98.6 MW (net) and are located in Nebraska. The second closing has not occurred and the purchase agreement contains a July 1, 2016 expiration date. As a result, while the purchase agreement remains in force, Invenergy and the Company now have the right to terminate the purchase agreement with respect to these two additional facilities at any time. These two wind facilities would be acquired through the acquisition of a 90.1% equity interest in Prairie Breeze Expansion Class B Holdings LLC for an estimated purchase price of $58.7 million which would be expected to be paid using cash on hand. However, both the Company or Invenergy Wind may determine not to consummate the acquisition. If the purchase agreement is terminated by either party, the Company will not purchase these facilities.

Termination of Obligation to Acquire Vivint Solar Assets from SunEdison

On July 20, 2015, SunEdison and Vivint Solar, Inc. ("Vivint Solar") signed a definitive merger agreement (the “SunEdison/Vivint Merger Agreement”) pursuant to which SunEdison would acquire Vivint Solar for approximately $1.3 billion. In connection with SunEdison’s then-pending acquisition of Vivint Solar, the Company entered into a definitive purchase agreement with SunEdison, as amended on December 9, 2015, (the "Amended Purchase Agreement") to acquire Vivint Solar’s residential solar generation facilities (the “Vivint Operating Assets”). The purchase price for the Vivint acquisition was expected to be approximately $814.8 million based on approximately 479.3 of installed MW expected to be acquired at the closing of the Amended Purchase Agreement. In connection with the purchase, the Company also obtained a commitment for a senior unsecured bridge facility in July of 2015 to fund the acquisition of the Vivint Operating Assets, including related acquisition costs. See Note 10. Long-term debt for additional disclosures of this bridge facility commitment. The Company entered into an interim agreement (the "Vivint Interim Agreement"), as amended on December 9, 2015, relating to, among other items, the Company's purchase of additional completed residential and small commercial solar generation facilities for a five year period from the acquired business and the provision of operation and maintenance services by SunEdison for the Vivint Operating Assets. The Company also entered a letter agreement with SunEdison, dated as of December 9, 2015 (the “Letter Agreement”), to provide the parties thereto with additional rights in connection with the Amended Purchase Agreement and the Vivint Interim Agreement.

As a result of Vivint Solar’s notice of termination of the SunEdison/Vivint Merger Agreement, dated as of March 7, 2016, each of the Amended Purchase Agreement and the Vivint Interim Agreement, and all other agreements related thereto, including the Letter Agreement, and the Company's obligations pursuant thereto, terminated on March 7, 2016. The commitment for the bridge facility, as amended and restated, also automatically terminated as of the same date. The Company, SunEdison and certain other parties and individuals have been named as defendants in several putative shareholder class actions that challenged the Vivint Solar and SunEdison merger (see Note 18. Commitments and Contingencies for additional disclosures over this litigation).

Unaudited Pro Forma Supplementary Data

The unaudited pro forma supplementary data presented in the table below gives effect to the significant 2015 acquisitions, Invenergy Wind, First Wind and Northern Lights, as if those transactions had each occurred on January 1, 2014. Additionally, the table below gives effect to the significant 2014 acquisitions, Capital Dynamics and Mt. Signal, as if these transactions had occurred on January 1, 2013. The unaudited pro forma supplementary data is provided for informational purposes only and should not be construed to be indicative of the Company’s results of operations had the acquisitions been consummated on the date assumed or of the Company’s results of operations for any future date.



	Year Ended December 31,
(In thousands, unaudited)	2015			2014
Total operating revenues, net	$	605,724		$	427,794
Net loss	(113,823		)	(102,938		)

Acquisition costs incurred by the Company related to third party acquisitions were $55.8 million and $15.2 million for the years ended December 31, 2015 and 2014. These costs are reflected as acquisition and related costs and acquisition and related costs - affiliate in the consolidated statements of operations. There were no acquisition costs for the year ended December 31, 2013.

The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable).

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 805
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-Section 50
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Reference 4: http://www.xbrl.org/2003/role/presentationRef
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Reference 5: http://www.xbrl.org/2003/role/presentationRef
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Reference 6: http://www.xbrl.org/2003/role/presentationRef
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Reference 7: http://www.xbrl.org/2003/role/presentationRef
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Reference 8: http://www.xbrl.org/2003/role/presentationRef
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Property, Plant and Equipment [Abstract]

Renewable Energy Facilities

12 Months Ended

Dec. 31, 2015

Renewable Energy Facilities

RENEWABLE ENERGY FACILITIES

Renewable energy facilities, net consists of the following:



(In thousands)	December 31, 2015			December 31, 2014
Renewable energy facilities in service, at cost	$	5,906,154		$	2,241,728
Less accumulated depreciation - renewable energy facilities	(187,874		)	(52,981		)
Renewable energy facilities in service, net	5,718,280			2,188,747
Construction in progress - renewable energy facilities	84,100			459,465
Total renewable energy facilities, net	$	5,802,380		$	2,648,212

Depreciation expense related to renewable energy facilities was $135.7 million, $37.3 million and $5.4 million for the years ended December 31, 2015, 2014 and 2013, respectively.

Construction in progress represents $84.1 million of costs incurred to complete the construction of the facilities in the Company's current portfolio that were acquired from SunEdison. When renewable energy facilities are contributed or sold to the Company after completion by SunEdison, the Company retroactively recasts its historical financial statements to present the construction activity as if it consolidated the facility at inception of the construction (see Note 3. Transactions Between Entities Under Common Control). All construction in progress costs are stated at SunEdison's historical cost. These costs include capitalized interest costs and amortization of deferred financing costs incurred during the asset's construction period, which totaled $22.4 million, $37.3 million and $4.4 million for the years ended December 31, 2015, 2014 and 2013, respectively.

Asset Retirement Obligations

12 Months Ended

Dec. 31, 2015

Asset Retirement Obligation Disclosure [Abstract]

Asset Retirement Obligations

ASSET RETIREMENT OBLIGATIONS

Activity in asset retirement obligations for the years ended December 31, 2015 and 2014 is as follows:



	Year Ended December 31,
(In thousands)	2015			2014
Balance as of the beginning of the year	$	78,175		$	13,005
Additional obligations from renewable energy facilities achieving commercial operation	52,181			34,414
Assumed through acquisition	74,293			29,450
Acquisition accounting adjustments related to prior year acquisitions	5,640			—
Accretion expense	7,209			2,109
Currency translation adjustment	(2,352		)	(803		)
Balance as of the end of the year	$	215,146		$	78,175

The Company does not have any assets that are legally restricted for the purpose of settling the Company's asset retirement obligations as of December 31, 2015 and 2014.

Goodwill

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill

GOODWILL

The changes in the carrying amount of goodwill for the year ended December 31, 2015, is presented in the table below:



(In thousands)	Distributed Generation reporting unit
Balance as of December 31, 2014	$	—
Goodwill acquired	55,874
Balance as of December 31, 2015	$	55,874

The Company completed its annual impairment test of the carrying value of its goodwill as of December 1, 2015 and concluded there was no impairment.

Intangibles

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Intangibles

INTANGIBLES

The following table presents the gross carrying amount and accumulated amortization of intangibles as of December 31, 2015:



(In thousands, except weighted-average amortization period)	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Favorable rate revenue contracts	17 years	$	714,137	$	(12,024	)	$	702,113
In-place value of market rate revenue contracts	20 years	551,226		(22,229		)	528,997
Favorable rate land leases	19 years	15,800		(746		)	15,054
Total intangible assets, net		$	1,281,163	$	(34,999	)	$	1,246,164

Unfavorable rate revenue contracts	8 years	$	35,086	$	(4,951	)	$	30,135
Unfavorable rate land lease	17 years	1,000		(51		)	949
Total intangible liabilities, net		$	36,086	$	(5,002	)	$	31,084

The following table presents the gross carrying amount and accumulated amortization of intangibles as of December 31, 2014:



(In thousands, except weighted-average amortization period)	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Favorable rate revenue contracts	17 years	$	221,555	$	(4,161	)	$	217,394
In-place value of market rate revenue contracts	24 years	146,258		(1,979		)	144,279
Total intangible assets, net		$	367,813	$	(6,140	)	$	361,673

As of December 31, 2015 and 2014, the Company had intangible assets related to revenue contracts, representing long-term PPAs and REC agreements, as well as favorable rate land leases as of December 31, 2015 that were obtained through acquisitions (see Note 4. Acquisitions). The revenue contract intangible assets are comprised of favorable rate PPAs and REC agreements and the in-place value of market rate PPAs. As of December 31, 2015, the Company also had intangible liabilities related to unfavorable rate PPAs and REC agreements and an unfavorable rate land lease, which are classified within other long-term liabilities in the consolidated balance sheet. These intangible assets and liabilities are amortized on a straight-line basis over the remaining lives of the agreements, which range from 1 to 29 years as of December 31, 2015.

Amortization expense related to favorable rate revenue contracts is reflected in the consolidated statements of operations as a reduction of operating revenues, net. Amortization related to unfavorable rate revenue contracts is reflected in the consolidated statements of operations as an increase to operating revenues, net. During the years ended December 31, 2015 and 2014, net amortization expense related to favorable and unfavorable rate revenue contracts resulted in a $5.3 million and $4.2 million decrease in operating revenues, net, respectively. There was no amortization expense related to favorable and unfavorable rate revenue contracts during the year ended December 31, 2013.

Amortization expense related to the in-place value of market rate revenue contracts is reflected in the consolidated statements of operations within depreciation, accretion and amortization expense. During the years ended December 31, 2015 and 2014, amortization expense related to the in-place value of market rate revenue contracts was $18.4 million and $2.0 million, respectively. There was no amortization expense related to the in-place value of market rate revenue contracts during the year ended December 31, 2013.

Amortization expense related to favorable rate land leases is reflected in the consolidated statements of operations within cost of operations. Amortization related to the unfavorable rate land lease is reflected in the consolidated statements of operations as a reduction of cost of operations. During the year ended December 31, 2015, net amortization expense related to favorable and unfavorable rate land leases was $0.7 million. There was no amortization expense related to favorable and unfavorable rate land leases during the years ended December 31, 2014 and 2013.

Over the next five fiscal years, the Company expects to recognize annual amortization expense on its intangibles as follows:



(In thousands)	2016			2017			2018			2019			2020
Favorable rate revenue contracts	$	44,429		$	44,362		$	43,415		$	43,329		$	43,263
Unfavorable rate revenue contracts	(5,496		)	(5,490		)	(4,956		)	(4,845		)	(2,620		)
Total net amortization expense recorded to operating revenues, net	$	38,933		$	38,872		$	38,459		$	38,484		$	40,643

In-place value of market rate revenue contracts	$	27,740		$	27,740		$	27,740		$	27,740		$	27,740
Total amortization expense recorded to depreciation, accretion and amortization expense	$	27,740		$	27,740		$	27,740		$	27,740		$	27,740

Favorable rate land leases	$	799		$	799		$	799		$	799		$	799
Unfavorable rate land lease	(56		)	(56		)	(56		)	(56		)	(56		)
Total net amortization expense recorded to cost of operations	$	743		$	743		$	743		$	743		$	743

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable Interest Entities

12 Months Ended

Dec. 31, 2015

Variable Interest Entities

VARIABLE INTEREST ENTITIES

The Company consolidates VIEs in renewable energy facilities when the Company is the primary beneficiary. The VIEs own and operate renewable energy facilities in order to generate contracted cash flows. The VIEs were funded through a combination of equity contributions from the owners and non-recourse project-level debt. No VIEs were deconsolidated during the years ended December 31, 2015 and 2014.

The carrying amounts and classification of the consolidated VIEs’ assets and liabilities included in the Company's consolidated balance sheets are as follows:



(In thousands)	December 31, 2015		December 31, 2014
Current assets	$	89,185	$	69,955
Non-current assets	1,969,853		1,756,276
Total assets	$	2,059,038	$	1,826,231
Current liabilities	$	614,195	$	64,324
Non-current liabilities	142,443		707,989
Total liabilities	$	756,638	$	772,313

The amounts shown in the table above exclude intercompany balances that are eliminated upon consolidation. All of the assets in the table above are restricted for settlement of the VIE obligations, and all of the liabilities in the table above can only be settled by using VIE resources.

Long-term Debt

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Long-term Debt

LONG-TERM DEBT

Long-term debt consists of the following:



(In thousands, except rates) Description:	December 31, 2015			December 31, 2014			Interest Type	Current Interest Rate (%)	Financing Type
Corporate-level long-term debt¹:
Term Loan	$	—		$	573,500		Variable	5.33²	Term debt
Senior Notes due 2023	950,000			—			Fixed	5.88	Senior notes
Senior Notes due 2025	300,000			—			Fixed	6.13	Senior notes
Revolver	655,000			—			Variable	2.79	Revolving loan
Non-recourse long-term debt³:
Permanent financing	2,546,864			824,167			Blended⁴	5.77⁵	Term debt / Senior notes
Construction financing	14,475			174,458			Variable	6.00	Construction debt
Financing lease obligations	136,594			126,167			Imputed	5.69⁵	Financing lease obligations
Total principal due for long-term debt and financing lease obligations	4,602,933			1,698,292				5.40⁵
Net unamortized (discount) premium	(20,821		)	1,473
Less current portion of long-term debt and financing lease obligations	(2,031,937		)	(100,488		)
Long-term debt and financing lease obligations, less current portion	$	2,550,175		$	1,599,277

———


(1)	Corporate-level debt represents debt issued by Terra Operating LLC and guaranteed by Terra LLC and certain subsidiaries of Terra Operating LLC other than non-recourse subsidiaries as defined in the relevant debt agreements.


(2)	The Company entered into an interest rate swap agreement fixing the interest rate at 5.33%. The swap agreement was terminated upon repayment of the Term Loan.


(3)	Non-recourse debt represents debt issued by subsidiaries with no recourse to Terra LLC, Terra Operating LLC, or guarantors of the Company's corporate-level debt, other than limited or capped contingent support obligations, which in aggregate are not considered to be material to the Company's business and financial condition.


(4)	Includes variable rate debt and fixed rate debt. As of December 31, 2015, 67% of this balance had a variable interest rate and the remaining 33% of this balance had a fixed interest rate. The Company has entered into interest rate swap agreements to fix the interest rates of certain variable rate permanent financing non-recourse debt (see Note 12. Derivatives).


(5)	Represents the weighted average interest rate as of December 31, 2015.

Corporate-level Long-term Debt

Term Loan

On January 28, 2015, the Company repaid the remaining outstanding principal balance on the term loan facility (the "Term Loan") of $573.5 million. The Company recognized a $12.0 million loss on the extinguishment of debt during the year ended December 31, 2015 as a result of this repayment.

Revolving Credit Facilities

On January 28, 2015, TerraForm Power Operating, LLC ("Terra Operating LLC"), an indirect subsidiary of TerraForm Power, Inc., replaced its existing revolver with a new $550.0 million revolving credit facility (the "Revolver"). The Revolver consists of a revolving credit facility of at least $550.0 million available for revolving loans and letters of credit. The Company recognized a $1.3 million loss on the extinguishment of debt during the year ended December 31, 2015 as a result of the revolver exchange.

On May 1, 2015, Terra Operating LLC exercised its option to increase its borrowing capacity under the Revolver by $100.0 million. On August 11, 2015, Terra Operating LLC exercised its option to further increase its borrowing capacity under the Revolver by $75.0 million. As a result of these transactions, the Company had a total borrowing capacity of $725.0 million under the Revolver as of December 31, 2015. There were $655.0 million of revolving loans outstanding under the Revolver as of December 31, 2015. There were no revolving loan amounts outstanding under the previous revolver as of December 31, 2014.

The Revolver matures on January 28, 2020. Each of Terra Operating LLC's existing and subsequently acquired or organized domestic restricted subsidiaries (excluding most non-recourse subsidiaries) and Terra LLC are or will become guarantors under the Revolver.

On December 9, 2015, Terra Operating LLC entered into a third amendment to its credit and guaranty agreement which amends the Leverage Ratio (as defined therein) from 5:00 :1:00 (subject to certain increases if certain acquisitions are consummated), to as follows:


•	6:00:1:00 for any fiscal quarter occurring after September 30, 2015, but ending on or before December 31, 2016;


•	5.75:1:00 for any fiscal quarter occurring after December 31, 2016, but ending on or before December 31, 2017; and


•	5:00:1:00 for any fiscal quarter ending after December 31, 2017 (subject to certain increases if certain acquisitions are consummated).

At Terra Operating LLC’s option, all outstanding amounts under the Revolver initially bore interest at a rate per annum equal to either (i) a base rate plus a margin of 1.50%, or (ii) a reserve adjusted Eurodollar rate plus a margin of 2.50%. Beginning July 1, 2015, the base rate margin ranges between 1.25% and 1.75% and the Eurodollar rate margin ranges between 2.25% and 2.75%, as determined by reference to a leverage-based grid. As of December 31, 2015, the applicable base rate and Eurodollar rate margins were 1.25% and 2.25%, respectively.

The Revolver provides for voluntary prepayments, in whole or in part, subject to notice periods, and requires Terra Operating LLC to prepay outstanding borrowings in an amount equal to 100% of the net cash proceeds received by Terra LLC or its restricted subsidiaries from the incurrence of indebtedness not permitted by the Revolver by Terra Operating LLC or its restricted subsidiaries.

The Revolver, each guaranty and any interest rate, currency hedging or hedging of REC obligations of Terra Operating LLC or any guarantor owed to the administrative agent, any arranger or any lender under the Revolver is secured by first priority security interests in (i) all of Terra Operating LLC's and each guarantor’s assets, (ii) 100% of the capital stock of Terra Operating LLC and each of its domestic restricted subsidiaries and 65% of the capital stock of each of Terra Operating LLC’s foreign restricted subsidiaries, and (iii) all intercompany debt. Although the Revolver collateral generally excludes the capital stock and assets of non-recourse subsidiaries, in connection with the seventh amendment to the Revolver (as discussed below), the Company agreed to cause certain project-level subsidiaries to guarantee the obligations under the Revolver and to provide certain collateral to the lenders and other secured parties under the Revolver, in each case, to the extent such subsidiaries are permitted to do so under any applicable project-level financing or debt agreements or other project-level agreements. These guarantees and the collateral will be automatically released to the extent such subsidiaries incur any project-level financings that would not permit such guarantees or collateral and that are otherwise permitted under the Revolver.

The terms of the Revolver require the Company to provide audited annual financial statements within 90 days after the end of the fiscal year, with a 10-business day cure period. From March 30, 2016 to May 6, 2016, Terra Operating LLC entered into a series of amendments (fourth, fifth and sixth) to the terms of the Revolver, which provided that the date on which the Company must deliver to the Administrative Agent and other parties to the Revolver its annual financial statements and accompanying audit report with respect to fiscal year 2015 shall be extended up to May 28, 2016. Under the sixth amendment, the interest rate on loans made under the Revolver and commitment fees paid on undrawn Revolver commitments will be calculated using the highest applicable margin and commitment fee percentage under the Revolver until the first business day of the first quarter following the delivery of 2015 financial statements and the accompanying audit report. On May 27, 2016, Terra Operating LLC entered into a seventh amendment to the Revolver, which further extended the due date for delivery of the Company's 2015 financial statements and the accompanying audit report to the earlier of (a) the tenth business day prior to the date on which the failure to deliver such financial statements would constitute an event of default under Terra Operating LLC's Indenture, dated January 28, 2015, with respect to its senior notes due 2023 (the "2023 Indenture") and (b) March 30, 2017. Under the seventh amendment, Terra Operating LLC was also required to request a waiver of any default or event of default under the 2023 Indenture with respect to the Company's obligation to make available audited financial statements for fiscal year 2015. As described below, Terra Operating LLC obtained a waiver extending the deadline to comply with the reporting covenants in the 2023 Indenture to December 6, 2016.

In addition to granting the additional collateral described above, the seventh amendment also amends the conditions under which Terra LLC and Terra Operating LLC are permitted to make distributions in respect of their equity, including by adding a requirement that Terra LLC and Terra Operating LLC satisfy a minimum Total Liquidity (as defined therein) at the time of making any such distribution. Although TerraForm Power is not a party to, or guarantor of Terra Operating LLC's obligations under, the Revolver, these conditions will also effectively apply to the payment of dividends by TerraForm Power on its Class A common stock.

The seventh amendment also extended the date by which the Company must deliver its unaudited quarterly financial statements for the fiscal quarter ending March 31, 2016 to June 30, 2016 and with respect to the fiscal quarters ending June 30, 2016 and September 30, 2016 to the date that is 75 days after the end of each fiscal quarter. The Company provided its unaudited quarterly financial statements for the fiscal quarters ending March 31, 2016 and June 30, 2016 to the Administrative Agent and other parties to the Revolver by the respective deadlines. Consistent with its obligations under the seventh amendment, Terra Operating LLC entered into an eighth amendment to the terms of the Revolver on September 9, 2016, which increased the interest rate under the Revolver at all applicable margin levels by 50% of the increase in the interest rate on the Senior Notes due 2023 agreed to as part of the consent solicitation process described below. This amendment will result in an increase in the current interest rate payable under the Revolver by 1.75% for the period from September 6, 2016 to December 6, 2016 and, thereafter, an increase from the current interest rate by 0.25%.

On September 27, 2016, Terra Operating LLC entered into a consent agreement and ninth amendment to the terms of the Revolver. The ninth amendment modified the definition of Total Liquidity in the Revolver to include voluntary or mandatory permanent reductions in Revolving Commitments in the calculation of Total Liquidity. The consent agreement also provided consent for the cross-collateralization of certain utility scale assets located in Canada owned by subsidiaries of the Company as further described in the "Canada project-level financing" section below. In addition, in conjunction with this consent, the agreement provided that Terra Operating LLC would prepay $70.0 million of revolving loans outstanding under the Revolver and permanently reduce the revolving commitments and borrowing capacity by such amount. This amount was repaid by Terra Operating LLC on November 10, 2016, which permanently reduced the borrowing capacity under the Revolver by such amount.

On November 25, 2016, Terra Operating LLC entered into a waiver agreement with the requisite lenders under the Revolver. The waiver agreement waived Terra Operating LLC’s obligation to comply with the debt service coverage ratio and leverage ratio financial covenants of the Revolver with respect to the third quarter of 2016 and the requirement to certify compliance with those covenants. In connection with this waiver, Terra Operating LLC made a prepayment of the revolving loans outstanding under the Revolver in an aggregate amount equal to $30.0 million and permanently reduced the revolving commitments and borrowing capacity under the Revolver by that amount. This amount was classified as current within the consolidated balance sheet as of December 31, 2015. The waiver also extended to January 1, 2017, the deadline for delivery of certain financial information with respect to the third quarter of 2016. If Terra Operating LLC fails to deliver that financial information, certain financial information with respect to the year ended 2015 and certain other related information by January 1, 2017, the waiver will expire and an event of default will have occurred under the Revolver. Failure to deliver certain summary financial information with respect to the third quarter of 2016 by December 21, 2016 would also result in an event of default under the Revolver.

Senior Notes due 2023 and Senior Notes due 2025

On January 28, 2015, Terra Operating LLC issued $800.0 million of 5.875% senior notes due 2023 at an offering price of 99.214% of the principal amount. Terra Operating LLC used the net proceeds from the offering to fund a portion of the purchase price payable in the First Wind Acquisition.

On June 11, 2015, Terra Operating LLC issued an additional $150.0 million of 5.875% senior notes due 2023 (collectively, with the $800.0 million initially issued, the "Senior Notes due 2023"). The offering price of the additional $150.0 million of notes was 101.5% of the principal amount, and Terra Operating LLC used the net proceeds from the offering to repay existing borrowings under the Revolver. The Senior Notes due 2023 are senior obligations of Terra Operating LLC and are guaranteed by Terra LLC and each of Terra Operating LLC's existing and future subsidiaries that guarantee its senior secured credit facility, subject to certain exceptions.

On July 17, 2015, Terra Operating LLC issued $300.0 million of 6.125% senior notes due 2025 at an offering price of 100% of the principal amount (the "Senior Notes due 2025"). Terra Operating LLC used the net proceeds from the offering to fund a portion of the purchase price of the acquisition of the wind power plants from Invenergy Wind. The Senior Notes due 2025 are senior obligations of Terra Operating LLC and are guaranteed by Terra LLC and each of Terra Operating LLC's existing and future subsidiaries that guarantee its senior secured credit facility, subject to certain exceptions.

The Senior Notes due 2023 and the Senior Notes due 2025 require the Company to timely file with the SEC, or make publicly available, audited annual financial statements for the fiscal year 2015 and unaudited quarterly financial statements for the fiscal year 2016 no later than 60 days following the date required by the SEC's rules and regulations (including extensions thereof). The Company has a 90-day grace period from the date a notice of default is deemed to be duly given to Terra Operating LLC in accordance with the Senior Notes due 2023 and the Senior Notes due 2025. On May 31, 2016, Terra Operating LLC received a notice from the trustee of an event of default for failure to deliver 2015 audited annual financial statements.

On June 24, 2016, the Company announced the commencement by Terra Operating LLC of a consent solicitation from holders of record as of 5:00 p.m., New York City time, on June 23, 2016 of its Senior Notes due 2023 and its Senior Notes due 2025 to obtain waivers relating to certain reporting covenants under the 2023 Indenture and the indenture dated as of July 17, 2015 (as supplemented) with respect to the Senior Notes due 2025 (the "2025 Indenture"), in each case, through December 31, 2016, in exchange for payment of a consent fee and monthly waiver extension fees beginning on August 29, 2016. The consent solicitation was set to expire on June 30, 2016 but was extended to August 19, 2016.

On August 19, 2016, the Company announced the commencement by Terra Operating LLC of an amended and restated solicitation of consents from holders of record as of 5:00 p.m., New York city time, on August 16, 2016 of its Senior Notes due 2023 and its Senior Notes due 2025 to obtain waivers relating to certain reporting covenants under the 2023 Indenture and the 2025 Indenture and to effectuate certain amendments to the respective indentures. The consent solicitation was set to expire on August 26, 2016.

On August 30, 2016, the Company announced the successful completion of the amended and restated solicitation of consents. Terra Operating LLC received validly delivered and unrevoked consents by August 26, 2016 from the holders of a majority of the aggregate principal amount of each series of the notes outstanding as of the record date and paid a consent fee to each consenting holder of $5.00 for each $1,000 principal amount of such series of the notes for which such holder delivered its consent. Under the terms of the waivers obtained, the deadline to comply with the reporting covenants in the indentures relating to the filing of the Company's Form 10-K for 2015 and Form 10-Q for the first quarter of 2016 was extended to December 6, 2016. If the Form 10-Q for the second quarter of 2016 is not filed by December 6, 2016, the period within which Terra Operating LLC must deliver such Form 10-Q would recommence and consequently no event of default is expected to occur with respect to the Form 10-Q for the second quarter of 2016 unless such Form 10-Q were not filed by early 2017.

Following receipt of the requisite consents required to approve the amendments to the respective indentures, Terra Operating LLC entered into a fourth supplemental indenture to the 2023 Indenture and a third supplemental indenture to the 2025 Indenture on August 29, 2016. Effective as of September 6, 2016, the fourth and third supplemental indentures respectively pemanently increase the interest rate payable on the Senior Notes due 2023 from 5.875% per annum to 6.375% per annum and the interest rate payable on the Senior Notes due 2025 from 6.125% per annum to 6.625% per annum. In addition, beginning on September 6, 2016 through and including December 6, 2016, special interest will accrue on the Senior Notes due 2023 and the Senior Notes due 2025 at a rate equal to 3.0% per annum, which shall be payable in the same manner as regular interest payments on the first interest payment date following December 6, 2016, which is February 1, 2017 and December 15, 2016, for the Senior Notes due 2023 and the Senior Notes due 2025, respectively. The fourth and third supplemental indentures also require the Company, upon the consummation of any transaction resulting in any person becoming the beneficial owner of 33.3% or more but less than or equal to 50% of the voting stock of the Company, to make an offer to each holder of the Senior Notes due 2023 and the Senior Notes due 2025, respectively, to repurchase all or any part of that holder's notes at a purchase price in cash equal to 101% of the aggregate principal amount of such notes repurchased. In lieu of making such an offer under either the 2023 Indenture or the 2025 Indenture, the applicable supplemental indenture also provides that Terra Operating LLC may elect to deliver a notice to the trustee under the 2023 Indenture or the 2025 Indenture, as applicable, to permanently increase the interest rates payable on the Senior Notes due 2023 from 6.375% per annum to 7.375% per annum or the interest rate on the Senior Notes due 2025 from 6.625% per annum to 7.625% per annum, respectively.

On November 15, 2016, the Company announced the commencement by Terra Operating LLC of a consent solicitation from holders of record as of 5:00 p.m., New York City time, on November 14, 2016 of its Senior Notes due 2023 and its Senior Notes due 2025 to obtain additional waivers relating to certain reporting covenants under the 2023 Indenture and the 2025 Indenture. The proposed waiver would waive any and all defaults or events of default existing as of December 6, 2016 as a result of the expiration of the waivers obtained and discussed above, and the consequences thereof, from December 6, 2016 until January 6, 2017, in exchange for payment of consent fees. The consent solicitation expired on December 2, 2016, with no waiver obtained.

Invenergy Bridge Facility

On July 1, 2015, the Company obtained commitments for a senior unsecured bridge facility to provide the Company with up to $1.16 billion to fund the acquisition of the wind power plants from Invenergy Wind. On July 17, 2015, the Company terminated $300.0 million of the bridge facility commitment upon the issuance of the Company's Senior Notes due 2025. This bridge facility commitment was amended and restated on December 4, 2015 to replace the previously committed bridge facility with a commitment to fund a $500.0 million non-recourse portfolio term loan. Amortization of deferred financing costs recorded as interest expense related to this bridge facility commitment was $9.4 million during the year ended December 31, 2015.

Vivint Solar Bridge Facility

On July 20, 2015, the Company obtained commitments for a senior unsecured bridge facility to provide the Company with up to $960.0 million to fund certain operating assets the Company expected to acquire from SunEdison in connection with SunEdison's then-pending acquisition of Vivint Solar. On December 9, 2015, in connection with the Amended Purchase Agreement, the Company entered into a second amended and restated debt commitment letter which amended the senior unsecured bridge facility commitment to $795.0 million. As of December 31, 2015, the bridge facility commitment had been reduced by $269.1 million to $525.9 million. Subsequent to December 31, 2015, the bridge facility commitment was further reduced by $66.6 million to $459.3 million. As a result of Vivint Solar’s notice of termination of the SunEdison/Vivint Solar Merger Agreement on March 7, 2016, the second amended and restated debt commitment letter automatically terminated.

Non-recourse Long-term Debt

Indirect subsidiaries of the Company have incurred long-term debt obligations with respect to the renewable energy facilities that those subsidiaries own directly or indirectly. This indebtedness of these subsidiaries is typically secured by the renewable energy facility's assets (mainly the renewable energy facility) or equity interests in such renewable energy facilities with no recourse to Terra LLC or Terra Operating LLC other than limited or capped contingent support obligations, which in aggregate are not considered to be material to the Company's business and financial condition. In connection with these financings and in the ordinary course of its business, the Company and its subsidiaries observe formalities and operating procedures to maintain each of their separate existence and can readily identify each of their separate assets and liabilities as separate and distinct from each other. As a result, these subsidiaries are legal entities that are separate and distinct from the Company, Terra LLC and Terra Operating LLC and the guarantors under the Revolver, the Senior Notes due 2023 and Senior Notes due 2025.

SunE Perpetual Lindsay

A construction term loan to finance and develop the construction of the SunE Perpetual Lindsay utility-scale solar power plant was entered into during 2014. During the year ended December 31, 2015, SunEdison repaid the remaining outstanding principal balance of CAD 47.7 million (equivalent of $38.6 million) due on the SunE Perpetual Lindsay construction term loan on the Company's behalf, which was recorded as a capital contribution from SunEdison within Net SunEdison investment on the consolidated statement of stockholders' equity.

United Kingdom Debt Refinancing

On November 6, 2015, the Company entered into definitive agreements to refinance 178.6 million British Pounds ("GBP") (equivalent of $270.8 million on the closing date) of existing non-recourse indebtedness by entering into a new GBP 313.5 million (equivalent of $475.2 million on the closing date) facility (the “New U.K. Facility”). The New U.K. Facility matures in 2022 and is comprised of Tranche A for GBP 87.0 million (equivalent of $131.9 million) which is fully amortizing over the seven-year term, and Tranche B for GBP 226.5 million (equivalent of $343.3 million), which is payable at maturity. The New U.K. Facility bears interest at a rate per annum equal to LIBOR plus an applicable margin of 2.10% for Tranche A and 2.35% for Tranche B. The New U.K. Facility is secured by all of the Company's solar generation facilities located in the U.K. except for the Norrington facility and is non-recourse to Terra LLC and Terra Operating LLC. The Company recognized a loss on extinguishment of debt of $7.5 million as a result of this refinancing.

Non-recourse Portfolio Term Loan

On December 4, 2015, a wholly owned subsidiary of the Company entered into a $500.0 million non-recourse portfolio term loan commitment. The term loan was funded on December 15, 2015 and a majority of the proceeds were used to acquire wind power plants from Invenergy Wind. The term loan is secured by pledges of indirect equity interests in the assets acquired from Invenergy Wind and certain other renewable energy facilities acquired from SunEdison and matures on January 15, 2019, to the extent the Company exercises its extension options. Interest under the term loan accrues at a rate equal to an adjusted Eurodollar rate plus 5.5%, subject to a 1.0% LIBOR floor (or base rate plus 4.5%). Borrowings under the term loan are prepayable at the Company’s option at par.

Financing Lease Obligations

In certain transactions, the Company accounts for the proceeds of sale-leasebacks as financings, which are typically secured by the renewable energy facility asset and its future cash flows from energy sales, with no recourse to Terra LLC or Terra Operating LLC under the terms of the arrangement.

As a result of the First Wind Acquisition, the Company acquired $47.4 million of financing lease obligations. The financing lease obligations assumed by the Company include those pursuant to a sale-leaseback agreement, entered into by First Wind on November 21, 2012, whereby First Wind sold substantially all of the property, plant and equipment of the related wind power plant to a financial institution and simultaneously entered into a long-term lease with that financial institution for the use of the assets. Under the terms of the agreement, the Company will continue to operate the wind facility and has the option to extend the lease or repurchase the assets sold at the end of the lease term.

On May 22, 2015, SunEdison acquired the lessor interest in an operating solar generation facility referred to as the Duke Energy operating facility and concurrently sold the facility to the Company. Upon acquisition of this operating facility, the Company recognized a net gain on the extinguishment of debt of $11.4 million due to the termination of $31.5 million of financing lease obligations of the operating facility.

First Wind Debt Extinguishment

The Company repaid certain long-term indebtedness for the renewable energy facilities acquired as part of the First Wind Acquisition. The Company recognized a loss on the extinguishment of debt of $6.4 million during the year ended December 31, 2015 as a result of this repayment.

Non-recourse Debt Defaults

SunEdison Debtors are a party to or guarantor of a material project agreement, such as asset management or O&M contracts, for most of the Company's non-recourse financing arrangements. As a result of the SunEdison Bankruptcy and delays in delivery of audited financial statements for certain project-level subsidiaries, among other things, the Company has experienced defaults under most of its non-recourse financing agreements. Any corresponding contractual grace periods for the instruments in default have already expired as of the financial statement issuance date or the Company cannot assert at this time that it is probable that the violation will be cured within any remaining grace periods, will be cured for a period of more than twelve months or are not likely to recur. While the Company is actively negotiating with the lenders to obtain waivers, the lenders have not currently waived or subsequently lost the right to demand repayment for more than one year from the balance sheet date with respect to these debt instruments. As these defaults occurred prior to the issuance of the financial statements for the year ended December 31, 2015, $1.9 billion of the Company’s non-recourse long-term indebtedness has been reclassified to current as of December 31, 2015 as the Company accounts for debt in default as of the date the financial statements are issued in the same manner as if the default existed as of the balance sheet date.

Canada project-level financing

On November 2, 2016, certain of our subsidiaries entered into a new non-recourse loan financing in an aggregate principal amount of $120.0 million Canadian dollars (“CAD”) (including a CAD $6.9 million letter of credit) secured by approximately 40MWac of utility scale solar power plants located in Canada that are owned by our subsidiaries. This new non-recourse loan has a seven-year maturity and amortizes on a 17-year sculpted amortization schedule. The loan agreement also permits our subsidiaries to increase the principal amount of the credit facility by up to an additional CAD $123.0 million subject to the satisfaction of certain conditions, including the absence of defaults or events of default, pro forma compliance with debt service coverage ratios and other customary conditions. This new loan facility is non-recourse to Terra LLC and Terra Operating LLC. The proceeds of this financing were used to pay down the Revolver by $70.0 million as described above. Any additional proceeds are are also expected to be used for general corporate purposes.

Minimum Lease Payments

The aggregate amounts of minimum lease payments on the Company's financing lease obligations are $136.6 million. Contractual obligations for 2016 through 2020 and thereafter, are as follows:



(In thousands)	2016		2017		2018		2019		2020		Thereafter		Total
Minimum lease obligations¹	$	9,968	$	9,119	$	9,252	$	18,968	$	9,320	$	79,967	$	136,594

———


(1)	Represents the minimum lease payment due dates for our financing lease obligations and does not reflect the reclassification of $99.1 million of financing lease obligations to current as a result of debt defaults under most of our non-recourse financing arrangements.

Maturities

The aggregate contractual payments of long-term debt due after December 31, 2015, excluding financing lease obligations and amortization of debt discounts and premiums, as stated in the financing agreements, are as follows:



(In thousands)	2016¹		2017		2018		2019		2020		Thereafter		Total
Maturities of long-term debt as of December 31, 2015²	$	123,927	$	98,269	$	120,882	$	562,432	$	727,720	$	2,833,109	$	4,466,339

———


(1)	Includes $14.5 million of construction debt for the utility-scale renewable energy facilities located in the U.S. acquired in 2015 from SunEdison which was repaid by SunEdison during the first quarter of 2016 (see Note 3. Transactions Between Entities Under Common Control). Also includes $30.0 million of Revolver indebtedness that was paid during the fourth quarter of 2016 as discussed above.


(2)	Represents the contractual principal payment due dates for our long-term debt and does not reflect the reclassification of $1.8 billion of long-term debt to current as a result of debt defaults under most of our non-recourse financing arrangements.

Income Taxes

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

The income tax provision consisted of the following:



(In thousands)	Current		Deferred			Total
Year ended December 31, 2015
U.S. federal	$	98	$	(12,507	)	$	(12,409	)
State and local	—		(1,182		)	(1,182		)
Foreign	158		192			350
Total expense (benefit)	$	256	$	(13,497	)	$	(13,241	)
Tax expense in equity	—		14,627			14,627
Total	$	256	$	1,130		$	1,386

Year ended December 31, 2014
U.S. federal	$	84	$	(3,554	)	$	(3,470	)
State and local	—		(213		)	(213		)
Foreign	—		(1,006		)	(1,006		)
Total expense (benefit)	$	84	$	(4,773	)	$	(4,689	)
Tax benefit in equity	—		(3,616		)	(3,616		)
Total	$	84	$	(8,389	)	$	(8,305	)

Year ended December 31, 2013
U.S. federal	$	—	$	(329	)	$	(329	)
State and local	—		42			42
Foreign	165		34			199
Total expense (benefit)	$	165	$	(253	)	$	(88	)

Effective Tax Rate

Income tax provision differed from the amounts computed by applying the statutory U.S. federal income tax rate of 35% to loss before income taxes.



	Year Ended December 31,
	2015		2014		2013
Income tax benefit at U.S. federal statutory rate	35.0	%	35.0	%	35.0	%
Increase (reduction) in income taxes:
State income taxes, net of U.S. federal benefit	1.0	%	1.0	%	(2.1	)%
Foreign operations	9.9	%	1.4	%	—	%
Non-controlling interest	(20.6	)%	(15.8	)%	—	%
Stock-based compensation	(2.2	)%	(2.2	)%	—	%
Change in valuation allowance	(17.7	)%	(8.8	)%	—	%
Other	0.6	%	(5.2	)%	(28.5	)%
Effective tax benefit rate	6.0	%	5.4	%	4.4	%

As of December 31, 2015, TerraForm Power owns 56.9% of Terra LLC and consolidates the results of Terra LLC through its controlling interest. The Company records SunEdison's 43.1% ownership of Terra LLC as a non-controlling interest in the financial statements. Terra LLC is treated as a partnership for income tax purposes. As such, the Company records income tax on its 56.9% of Terra LLC's taxable income and SunEdison records income tax on its 43.1% share of Terra LLC's taxable income.

For the year ended December 31, 2015, the overall effective tax rate was different than the statutory rate of 35% primarily due to the recording of a valuation allowance on certain tax benefits attributed to the Company and loss allocated to non-controlling interests, and due to the application of the intraperiod allocation rules, resulting in a significant tax provision recorded in other comprehensive income. For the year ended December 31, 2014, the tax benefits for losses realized prior to the IPO were recognized primarily because of existing deferred tax liabilities. As of December 31, 2015, most jurisdictions are in a net deferred tax asset position. A valuation allowance is recorded against the deferred tax assets primarily because of the history of losses in those jurisdictions.

The tax effects of the major items recorded as deferred tax assets and liabilities are:



	As of December 31,
(In thousands)	2015			2014
Deferred tax assets:
Net operating losses and tax credit carryforwards	$	217,834		$	53,968
Investment in partnership	123,253			141,148
Deferred revenue	743			207
Renewable energy facilities	11,667			2,078
Total deferred tax assets	353,497			197,401
Valuation allowance	(333,858		)	(167,508		)
Net deferred tax assets	19,639			29,893
Deferred tax liabilities:
Investment in partnership	45,269			25,287
Renewable energy facilities	—			7,473
Other	1,000			229
Total deferred tax liabilities	46,269			32,989
Net deferred tax liabilities	$	26,630		$	3,096

The underlying renewable energy facilities are controlled under Terra LLC, and thus deferred tax assets and liabilities at the Company's portfolio companies are captured within the deferred tax asset for investment in partnership. The Company has gross net operating loss carryforwards of $496.8 million in the U.S. and $177.9 million in multiple foreign jurisdictions that will expire beginning in 2035. The Company believes that it is more likely than not that it will not generate sufficient taxable income to realize the deferred tax assets associated with its net operating losses and tax credit carryforwards and has recorded a valuation allowance against its deferred tax assets, with the exception of $24.6 million of net operating losses at its Canadian operations. The Company is currently performing an analysis of limitations on the use of net operating losses under Section 382. The results of this analysis could impact the Company's ability to use net operating losses in future periods or could reduce the net operating losses available.

As of December 31, 2015, the Company has identified no uncertain tax positions for which a liability is required.

Derivatives

12 Months Ended

Dec. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

DERIVATIVES

As part of the Company’s risk management strategy, the Company has entered into derivative instruments which include interest rate swaps, foreign currency contracts and commodity contracts to mitigate interest rate, foreign currency and commodity price exposure. If the Company elects to do so and if the instrument meets the criteria, the Company designates its derivative instruments as cash flow hedges. The Company enters into interest rate swap agreements in order to hedge the variability of expected future cash interest payments. Foreign currency contracts are used to reduce risks arising from the change in fair value of certain foreign currency denominated assets and liabilities. The objective of these practices is to minimize the impact of foreign currency fluctuations on operating results. The Company also enters into commodity contracts to hedge price variability inherent in electricity sales arrangements. The objectives of the commodity contracts are to minimize the impact of variability in spot electricity prices and stabilize estimated revenue streams. The Company does not use derivative instruments for speculative or trading purposes.

As of December 31, 2015 and 2014, fair values of the following derivative instruments were included in the balance sheet captions indicated below:



	Fair Value of Derivative Instruments
	Hedging Contracts				Derivatives Not Designated as Hedges
(In thousands)	Interest Rate Swaps		Commodity Contracts		Interest Rate Swaps		Foreign Currency Contracts		Commodity Contracts		Gross Amounts of Assets/Liabilities Recognized		Gross Amounts Offset in Consolidated Balance Sheets			Net Amounts in Consolidated Balance Sheets
As of December 31, 2015
Prepaid expenses and other current assets	$	—	$	11,455	$	—	$	3,875	$	12,542	$	27,872	$	(1,451	)	$	26,421
Other assets	487		51,699		—		2,836		30,799		85,821		(70		)	85,751
Total assets	$	487	$	63,154	$	—	$	6,711	$	43,341	$	113,693	$	(1,521	)	$	112,172
Accounts payable and other current liabilities	$	19,081	$	—	$	1,104	$	3,777	$	—	$	23,962	$	(1,451	)	$	22,511
Other long-term liabilities	—		—		—		70		—		70		(70		)	—
Total liabilities	$	19,081	$	—	$	1,104	$	3,847	$	—	$	24,032	$	(1,521	)	$	22,511

As of December 31, 2014
Other assets	$	—	$	—	$	—	$	1,811	$	—	$	1,811	$	—		$	1,811
Total assets	$	—	$	—	$	—	$	1,811	$	—	$	1,811	$	—		$	1,811
Accounts payable and other current liabilities	$	1,925	$	—	$	1,279	$	685	$	—	$	3,889	$	—		$	3,889
Total liabilities	$	1,925	$	—	$	1,279	$	685	$	—	$	3,889	$	—		$	3,889

As of December 31, 2015 and 2014, notional amounts for derivative instruments consisted of the following:



(In thousands)	December 31, 2015	December 31, 2014
Derivatives designated as hedges:
Interest rate swaps (USD)	468,067	349,213
Interest rate swaps (GBP)	222,018	—
Commodity contracts (MWhs)	18,401	—
Derivatives not designated as hedges:
Interest rate swaps (USD)	15,794	16,861
Foreign currency contracts (GBP)	112,168	58,710
Foreign currency contracts (CAD)	40,566	25,415
Commodity contracts (MWhs)	1,828	—

The Company has elected to present net derivative assets and liabilities on the balance sheet as a right to setoff exists. For interest rate swaps, the Company either nets derivative assets and liabilities on a trade-by-trade basis or nets them in accordance with a master netting arrangement if such an arrangement exists with the counterparties. Foreign currency contracts are netted by currency in accordance with a master netting arrangement. The Company has a master netting arrangement for its commodity contracts for which no amounts were netted as of December 31, 2015 as each of the commodity contracts were in a gain position.

Gains and losses on derivatives not designated as hedges for the years ended December 31, 2015, 2014 and 2013 consisted of the following:



	Location of Loss (Gain) in the Statements of Operations	Year Ended December 31,
(In thousands)	Location of Loss (Gain) in the Statements of Operations	2015			2014			2013
Interest rate swaps	Interest expense, net	$	345		$	1,279		$	—
Foreign currency contracts	Loss (gain) on foreign currency exchange, net	(3,600		)	(1,126		)	—
Commodity contracts	Operating revenues, net	(10,178		)	—			—

Gains (losses) recognized related to interest rate swaps and commodity contracts designated as cash flow hedges for the years ended December 31, 2015, 2014 and 2013 consisted of the following:



	Year Ended December 31,
	Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion) net of taxes¹								Location of Loss Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion)	Amount of Loss Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion)						Amount of Loss Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
(In thousands)	2015			2014			2013			2015		2014		2013		2015		2014		2013
Interest rate swaps	$	(11,482	)	$	(1,925	)	$	—	Interest expense, net	$	4,663	$	—	$	—	$	—	$	—	$	—
Commodity contracts	38,395			—			—		Operating revenues, net	—		—		—		—		—		—
Total	$	26,913		$	(1,925	)	$	—		$	4,663	$	—	$	—	$	—	$	—	$	—

————


(1)	Net of taxes of $14.6 million related to commodity contracts during the year ended December 31, 2015. There were no taxes related to interest rate swaps during the year ended December 31, 2015. There were no taxes related to derivatives designated as hedges during the years ended December 31, 2014 and 2013.

As of December 31, 2015, the Company has posted letters of credit in the amount of $18.0 million as collateral related to certain commodity contracts. There were no letters of credit posted as collateral for commodity contracts as of December 31, 2014. Certain derivative contracts contain provisions providing the counterparties a lien on specific assets as collateral. There was no cash collateral received or pledged as of December 31, 2015 and 2014 related to the Company's derivative transactions.

Derivatives Designated as Hedges

Interest Rate Swaps

The Company has interest rate swap agreements to hedge variable rate non-recourse debt. These interest rate swaps qualify for hedge accounting and were designated as cash flow hedges. Under the interest rate swap agreements, the renewable energy facilities pay a fixed rate and the counterparties to the agreements pay a variable interest rate. The amounts deferred in other comprehensive income and reclassified into earnings during the years ended December 31, 2015, 2014 and 2013 related to the interest rate swaps are provided in the tables above. The loss expected to be reclassified into earnings over the next twelve months is approximately $11.5 million. The maximum tenor of outstanding interest rate swaps designated as hedges is 18 years.

In September 2014, the Company entered into an interest rate swap agreement to hedge floating rate debt under the Term Loan. The interest rate swap qualified for hedge accounting and was designated as a cash flow hedge. Under the interest rate swap agreement, the Company paid a fixed rate and the counterparty to the agreement paid the Company a floating interest rate. This interest rate swap agreement was terminated on January 28, 2015, due to the extinguishment of the Term Loan by the Company on the same date, as discussed in Note 10. Long-term Debt. Due to the termination of the Term Loan, the Company reclassified the loss of $2.5 million that was previously deferred in other comprehensive income into earnings as the forecasted transaction is considered probable of not occurring. The reclassified amounts were recorded in interest expense, net during the current year. Additionally, the Company recognized a loss of extinguishment of debt of $0.3 million during the year ended December 31, 2015 for fees incurred to terminate the interest rate swap.

As discussed in Note 10. Long-term Debt, the Company experienced defaults under most of its non-recourse financing agreements prior to the issuance of the financial statements for the year ended December 31, 2015. As the Company's interest rate swap agreements contain cross-default provisions, $7.6 million of related liabilities have been reclassified to current as of December 31, 2015. The Company is actively working with the counterparties to cure these defaults and obtain waivers as necessary. The Company does not currently expect any changes to the underlying cash flows as a result of these defaults and thus has determined that there is no impact to the swaps' qualification for hedge accounting and designation as cash flow hedges.

Commodity Contracts

The Company has long-dated physically delivered commodity PPAs that hedge variability in cash flows associated with the sales of power from certain renewable energy facilities located in Texas. These commodity contracts qualify for hedge accounting and are designated as cash flow hedges. Accordingly, the effective portions of the change in fair value of these derivatives are reported in accumulated other comprehensive income and subsequently reclassified to earnings in the periods when the hedged transactions affect earnings. Any ineffective portions of the derivatives’ change in fair value are recognized currently in earnings. The amounts deferred in other comprehensive income and reclassified into earnings during the years ended December 31, 2015, 2014 and 2013, related to the commodity contracts are provided in the tables above. The gain expected to be reclassified into earnings over the next twelve months is approximately $7.2 million (net of taxes of $4.3 million). The maximum tenor of outstanding commodity contracts designated as hedges is 14 years.

Derivatives Not Designated as Hedges

Interest Rate Swaps

The Company has interest rate swap agreements that economically hedge the cash flows for non-recourse debt. These interest rate swaps pay a fixed rate and the counterparties to the agreements pay a variable interest rate. The changes in fair value are recorded in interest expense, net in the consolidated statements of operations as these hedges are not accounted for under hedge accounting.

Foreign Currency Contracts

The Company has foreign currency contracts in order to economically hedge its exposure to foreign currency fluctuations. The settlement of these hedges occurs on a quarterly basis through maturity. As these hedges are not accounted for under hedge accounting, the changes in fair value are recorded in loss on foreign currency exchange, net in the consolidated statements of operations.

Commodity Contracts

The Company has commodity contracts in order to economically hedge commodity price variability inherent in certain electricity sales arrangements. If the Company sells electricity to an independent system operator market and there is no PPA available, it may enter into a commodity contract to hedge all or a portion of their estimated revenue stream. These commodity contracts require periodic settlements in which the Company receives a fixed-price based on specified quantities of electricity and pays the counterparty a variable market price based on the same specified quantity of electricity. As these hedges are not accounted for under hedge accounting, the changes in fair value are recorded in operating revenues net, in the consolidated statements of operations.

The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 30
-Section 45
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=6441202&loc=d3e80720-113993

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 4C
-URI http://asc.fasb.org/extlink&oid=56946850&loc=SL5624171-113959

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 10
-Section 50
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=56946850&loc=d3e41620-113959

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
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Fair Value of Financial Instruments

Fair Value of Financial Instruments

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair value of assets and liabilities are determined using either unadjusted quoted prices in active markets (Level 1) or pricing inputs that are observable (Level 2) whenever that information is available and using unobservable inputs (Level 3) to estimate fair value only when relevant observable inputs are not available. The Company uses valuation techniques that maximize the use of observable inputs. Assets and liabilities are classified in their entirety based on the lowest priority level of input that is significant to the fair value measurement. Where observable inputs are available for substantially the full term of the asset or liability, the instrument is categorized in Level 2. If the inputs into the valuation are not corroborated by market data, in such instances, the valuation for these contracts is established using techniques including extrapolation from or interpolation between actively traded contracts as well as calculation of implied volatilities. When such inputs have a significant impact on the measurement of fair value, the instrument is categorized as Level 3. The Company regularly evaluates and validates the inputs used to determine fair value of Level 3 contracts by using pricing services to support the underlying market price of commodity.

The Company uses a discounted cash flow valuation technique to fair value its derivative assets and liabilities. The primary inputs in the valuation models for commodity contracts are market observable forward commodity curves and risk-free discount rates and to a lesser degree credit spreads and volatilities. The primary inputs into the valuation of interest rate swaps and foreign currency contracts are forward interest rates, foreign currency exchange rates, and to a lesser degree credit spreads.

Recurring Fair Value Measurements

The following table summarizes the financial instruments measured at fair value on a recurring basis classified in the fair value hierarchy (Level 1, 2 or 3) based on the inputs used for valuation in the consolidated balance sheets:



(In thousands)	As of December 31, 2015								As of December 31, 2014
Assets	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Interest rate swaps	$	—	$	487	$	—	$	487	$	—	$	—	$	—	$	—
Commodity contracts	—		43,341		63,154		106,495		—		—		—		—
Foreign currency contracts	—		5,190		—		5,190		—		1,811		—		1,811
Total derivative assets	$	—	$	49,018	$	63,154	$	112,172	$	—	$	1,811	$	—	$	1,811
Liabilities
Interest rate swaps	$	—	$	20,185	$	—	$	20,185	$	—	$	3,204	$	—	$	3,204
Foreign currency contracts	—		2,326		—		2,326		—		685		—		685
Total derivative liabilities	$	—	$	22,511	$	—	$	22,511	$	—	$	3,889	$	—	$	3,889

The Company's interest rate swaps, commodity contracts not designated as hedges and foreign currency contracts are considered Level 2, since all significant inputs are corroborated by market observable data. The Company's commodity contracts designated as hedges are considered Level 3 as they contain significant unobservable inputs. There were no transfers in or out of Level 1, Level 2 and Level 3 during the year ended December 31, 2015.

The following table reconciles the changes in the fair value of derivative instruments classified as Level 3 in the fair value hierarchy for the year ended December 31, 2015:



(In thousands)	Year Ended December 31, 2015
Balance as of January 1, 2015	$	—
Realized and unrealized gains (losses):
Included in Other Comprehensive Income	53,022
Included in earnings	—
Purchases (acquisition of commodity contracts)	10,132
Settlements	—
Balance as of December 31, 2015	$	63,154

The significant unobservable inputs used in the valuation of the Company's commodity contracts categorized as Level 3 of the fair value hierarchy as of December 31, 2015 are as follows:



(In thousands, except range)	Fair Value as of December 31, 2015
Transaction Type	Assets		Liabilities		Valuation Technique	Unobservable Inputs	Range
Commodity contracts - power	$	63,154	$	—	Discounted cash flow	Forward price (per MWh)	$	18.1		-	$	153.9
					Option model	Volatilities	3.0		%	-	3.0		%

The sensitivity of the Company's fair value measurements to increases (decreases) in the significant unobservable inputs is as follows:



Significant Unobservable Input	Position	Impact on Fair Value Measurement
Increase (decrease) in forward price	Forward sale	Decrease (increase)
Increase (decrease) in implied volatilities	Purchase option	Increase (decrease)

The Company measures the sensitivity of the fair value of its Level 3 commodity contracts to potential changes in commodity prices using a mark-to-market analysis based on the current forward commodity prices and estimates of the price volatility. An increase in power forward prices will produce a mark-to-market loss, while a decrease in prices will result in a mark-to-market gain.

Fair Value of Debt

The carrying amount and estimated fair value of the Company's long-term debt as of December 31, 2015 and December 31, 2014 is as follows:



	As of December 31, 2015				As of December 31, 2014
(In thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt, including current portion	$	4,582,112	$	4,333,734	$	1,699,765	$	1,707,781

The fair value of the Company's long-term debt, except the senior notes was determined using inputs classified as Level 2 and a discounted cash flow approach using market rates for similar debt instruments. The fair value of the senior notes is based on market price information which is classified as a Level 1 input. They are measured using available trades at the end of each respective fiscal year. The fair value of the Senior Notes due 2023 and Senior Notes due 2025 were 83.13% and 80.75% of face value as of December 31, 2015, respectively. The fair value is not indicative of the amount that the Company would have to pay to redeem these notes as they are not callable at this time.

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

Stockholder's Equity

12 Months Ended

Dec. 31, 2015

Stockholder's Equity

STOCKHOLDERS' EQUITY

January 2015 Public Offering

On January 22, 2015, TerraForm Power sold 13,800,000 shares of its Class A common stock to the public in a registered offering including 1,800,000 shares sold pursuant to the underwriters' overallotment option. TerraForm Power received net proceeds of $390.6 million, which were used to purchase 13,800,000 Class A units of Terra LLC. Terra LLC used $50.9 million to repurchase 1,800,000 Class B units from SunEdison. Concurrent with this transaction, 1,800,000 shares of TerraForm Power Class B common stock were canceled.

June 2015 Public Offering

On June 24, 2015, TerraForm Power sold 18,112,500 shares of its Class A common stock to the public in a registered offering including 2,362,500 shares sold pursuant to the underwriters' overallotment option. TerraForm Power received net proceeds of $667.6 million, which were used to purchase 18,112,500 Class A units of Terra LLC. Terra LLC used $87.1 million to repurchase 2,362,500 Class B units from SunEdison. Concurrent with this transaction, 2,362,500 shares of TerraForm Power Class B common stock were canceled.

Riverstone Exchange

As of May 28, 2015, all outstanding Class B1 units in Terra LLC and all outstanding shares of Class B1 common stock of TerraForm Power held by R/C US Solar Investment Partnership, L.P. (‘‘Riverstone’’) had been converted into Class A units of Terra LLC held by TerraForm Power and shares of Class A common stock of TerraForm Power.

As of December 31, 2015, the following shares of TerraForm Power were outstanding:



Shares:	Number Outstanding	Shareholder(s)
Class A common stock	79,612,533	*
Class B common stock	60,364,154	SunEdison
Total Shares	139,976,687

———

* Class A common stockholders are comprised of public and private investors, executive officers, management and personnel who provide services to the Company. Shares of Class A common stock outstanding exclude 121,732 shares of common stock held in treasury. The total par value of Class A common stock reflected on the consolidated balance sheet and consolidated statement of stockholders' equity as of December 31, 2015 includes 121,732 shares of stock held in treasury and excludes 1,334,158 shares of unvested restricted Class A common stock awards (see Note 15. Stock-based Compensation).

Dividends

On December 22, 2014, TerraForm Power declared a quarterly dividend for the fourth quarter of 2014 on its Class A common stock of $0.27 per share, or $1.08 per share on an annualized basis. The fourth quarter dividend was paid on March 16, 2015 to shareholders of record as of March 2, 2015.

On May 7, 2015, TerraForm Power declared a quarterly dividend for the first quarter of 2015 on its Class A common stock of $0.325 per share, or $1.30 per share on an annualized basis. The first quarter dividend was paid on June 15, 2015 to shareholders of record as of June 1, 2015.

On August 6, 2015, TerraForm Power declared a quarterly dividend for the second quarter of 2015 on its Class A common stock of $0.335 per share, or $1.34 per share on an annualized basis. The second quarter dividend was paid on September 15, 2015 to shareholders of record as of September 1, 2015.

On November 9, 2015, TerraForm Power declared a quarterly dividend for the third quarter of 2015 on its Class A common stock of $0.35 per share, or $1.40 per share on an annualized basis. The third quarter dividend was paid on December 15, 2015 to shareholders of record as of December 1, 2015.

TerraForm Power has not declared or paid a dividend for the fourth quarter of 2015 or the first, second or third quarter of 2016. As a result of the SunEdison Bankruptcy, the limitations on the Company's ability to access the capital markets for its corporate debt and equity securities, and other risks that the Company faces as detailed in this report, the Company's management believes it is prudent to defer any decisions on paying dividends to its shareholders for the time being.

Subsequent Events

Reduction in SunEdison’s Ownership of Class B Shares

On January 22, 2016, TerraForm Power issued 12,161,844 shares of Class A common stock to affiliates of the D.E. Shaw group, Madison Dearborn Capital Partners IV, L.P. and Northwestern University and Terra LLC issued 12,161,844 Class A units of Terra LLC to TerraForm Power upon conversion of 12,161,844 Class B shares of TerraForm Power common stock and 12,161,844 Class B units of Terra LLC held by SunEdison. After giving effect to the conversion, SunEdison indirectly owns 48,202,310 Class B shares of TerraForm Power and 48,202,310 Class B units of Terra LLC.

Stockholder Protection Rights Agreement

On July 24, 2016, the Company's board of directors adopted a Stockholder Protection Rights Agreement (the “Rights Agreement”) and declared a dividend of one Right on each outstanding share of TerraForm Power Class A common stock. The record date to determine which stockholders are entitled to receive the Rights is August 4, 2016. The Rights Agreement was adopted in response to the potential sale of a significant equity stake in the Company by SunEdison and the potential accumulation of TerraForm Power Class A shares.

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

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Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based Compensation

12 Months Ended

Dec. 31, 2015

Stock-based Compensation

STOCK-BASED COMPENSATION

The TerraForm Power 2014 Second Amended and Restated Long-Term Incentive Plan provides for the award of incentive and nonqualified stock options, restricted stock awards ("RSAs") and restricted stock units ("RSUs") to personnel and directors who provide services to the Company, including personnel and directors who provide services to SunEdison. The maximum contractual term of an award is ten years from the date of grant. As of December 31, 2015, an aggregate of 1,690,052 shares of Class A common stock were available for issuance. Upon exercise of stock options or the vesting of the RSUs, the Company will issue shares that have been previously authorized to be issued.

Stock-based compensation costs related to equity awards in the Company's stock are allocated to the Company and SunEdison based on the relative percentage of time that the personnel and directors spend providing services to the respective companies. The amount of stock-based compensation expense related to equity awards in the Company's stock which has been allocated to the Company was $12.1 million and $5.8 million for the years ended December 31, 2015 and 2014, respectively, and is reflected in the consolidated statements of operations within general and administrative expenses. There was no stock-based compensation expense for the year ended December 31, 2013. The amount of stock-based compensation cost related to equity awards in the Company's stock which has been allocated to SunEdison was $10.5 million for the year ended December 31, 2015 and is recognized as a distribution to SunEdison within Net SunEdison investment on the consolidated statement of stockholders' equity with no impact to the Company's consolidated statement of operations. There were no similar stock-based compensation related distributions to or contributions from SunEdison during the years ended December 31, 2014 or 2013. Similarly, stock-based compensation costs related to equity awards in the stock of SunEdison for personnel and directors who provide services to the Company are allocated to the Company based on the relative percentage of time that the personnel and directors spend providing services to the Company. The amount of stock-based compensation expense related to equity awards in the stock of SunEdison that was allocated to the Company was $1.0 million for the year ended December 31, 2015 and is reflected in the consolidated statement of operations within general and administrative expenses - affiliate and has been treated as an equity contribution from SunEdison within Net SunEdison investment on the consolidated statement of stockholders' equity. There were no similar amounts during the years ended December 31, 2014 or 2013.

Restricted Stock Awards

RSAs provide the holder with immediate voting rights, but are restricted in all other respects until vested. Upon a termination of employment for any reason, any unvested shares of Class A common stock held by the terminated participant will be forfeited. All unvested RSAs are paid dividends and distributions.

The following table presents information regarding outstanding RSAs as of December 31, 2015 and changes during the year then ended:



	Number of RSAs Outstanding		Weighted-Average Grant-Date Fair Value Per Share		Aggregate Intrinsic Value (in millions)
Balance as of January 1, 2015	4,876,567		$	1.12
Converted	(2,458,190	)	0.79
Forfeited	(625,055	)	0.68
Modified	66,294		35.05
Balance as of December 31, 2015	1,859,616		$	2.93	$	23.4

As of December 31, 2015, $0.5 million of total unrecognized compensation cost related to RSAs is expected to be recognized over a weighted average period of approximately 0.7 years. The weighted average fair value of RSAs per share on the date of grant was $0.57 for the year ended December 31, 2014.

The removal of the Company's prior Chief Executive Officer on November 20, 2015 resulted in the forfeiture of 454,586 RSAs as well as the immediate accelerated vesting of an additional 454,586 RSAs. The aforementioned termination resulted in a net increase to the Company's stock-based compensation expense for the year ended December 31, 2015 of $0.3 million.

Restricted Stock Units

RSUs will not entitle the holders to voting rights and holders of the RSUs will not have any right to receive dividends or distributions.

The following table presents information regarding outstanding RSUs as of December 31, 2015 and changes during the year then ended:



	Number of RSUs Outstanding		Aggregate Intrinsic Value (in millions)		Weighted Average Remaining Contractual Life (In Years)
Balance as of January 1, 2015	825,943
Granted	2,851,857
Converted	(228,792	)
Forfeited	(240,614	)
Balance as of December 31, 2015	3,208,394		$	40.4	1.4

As of December 31, 2015, $51.3 million of total unrecognized compensation cost related to RSUs is expected to be recognized over a weighted average period of approximately 3.3 years. The weighted-average fair value of RSUs on the date of grant was $20.60 and $27.37 for the years ended December 31, 2015 and 2014, respectively.

The removal of the Company's prior Chief Financial Officer on November 20, 2015 resulted in the forfeiture of 106,250 RSUs as well as the immediate accelerated vesting of an additional 106,250 RSUs. The aforementioned termination resulted in a net increase to the Company's stock-based compensation expense for the year ended December 31, 2015 of $0.9 million.

On December 22 and 23, 2015, the Company awarded 1,264,880 RSUs to certain employees and executive officers of SunEdison and the Company. These are time-based awards which will vest on the following schedule: 25% after one year, 25% after two years, and 50% after three years. The grant-date fair value of these awards was $15.7 million which will be recognized as compensation cost on a straight-line basis over the three year service period.

On March 10, 2015, the Company awarded 841,900 RSUs to certain employees and executive officers of SunEdison and the Company. These RSU awards are 80% performance-based and 20% time-based, which are vested at 25% per year over a four-year period. For the performance-based RSUs, there are three performance tiers with each tier representing 33% of the entire grant. Each of the performance tiers are based on dividend per share targets, as pre-determined and approved by the Company's Board of Directors. If certain performance goals are not achieved, the first, second or third performance tiers are forfeited in its entirety. If certain performance goals are met by the first quarter of 2016, 2017, and 2018, as measured by the last twelve months, the first, second and third tier will vest at 50%, 75% or 100%. Upon achievement of the targets, participants will vest in the respective tier at 50% during the measurement year, 30% the following year and 20% the year after that. The grant-date fair value of these awards was $28.8 million which will be recognized as compensation cost on a straight-line basis over the requisite service periods of four years for the time-based awards and five years for the performance-based awards. The grant-date fair value of these awards was calculated based on the Company's stock price as of the date of grant since meeting the requisite performance conditions was considered probable as of this date.

On July 28, 2015, SunEdison began recognizing expense related to 199,239 performance-based RSUs granted by the Company to certain employees of First Wind in connection with its acquisition by SunEdison on January 29, 2015. The performance-based awards were issued in three tranches covering the 2015, 2016, and 2017 fiscal year performance periods and are based on the achievement of targets related to additions to SunEdison's renewable energy generation project development pipeline and backlog, the volume of renewable energy generation projects transferred into the Company or SunEdison's warehouse vehicles, and the achievement of cash available for distribution by wind power plants sold to the Company through the First Wind Acquisition agreement. The grant-date fair value of these awards was $6.2 million which will be recognized as compensation cost on a straight-line basis over the requisite service periods of one year for the 2015 tranche, two years for the 2016 tranche, and three years for the 2017 tranche. The grant-date fair value of these awards was calculated based on the Company's stock price on the date of grant since meeting the requisite performance conditions was considered probable as of this date. As the cash available for distribution targets for the 2016 and 2017 performance periods will not be set until the beginning of the respective performance periods, the Company will not begin recognizing compensation cost for an additional 102,638 RSU awards related to the aforementioned targets until such performance criteria have been set.

Stock Options

The following table presents information regarding outstanding stock options as of December 31, 2015 and changes during the year then ended:



	Number of Stock Options Outstanding		Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value (in millions)		Weighted Average Remaining Contractual Life (In Years)
Balance as of January 1, 2015	150,000		$	29.31
Forfeited	(93,750	)	29.31
Balance as of December 31, 2015	56,250		$	29.31	$	—	0.1
Options exercisable as of December 31, 2015	56,250		$	29.31	$	—	0.1

Aggregate intrinsic value represents the value of the Company's closing stock price of $12.58 on the last trading date of the period in excess of the weighted average exercise price multiplied by the number of stock options outstanding or exercisable.

As of December 31, 2015, there was no unrecognized compensation cost in relation to outstanding stock options. The weighted average grant-date fair value per share of options granted was $11.35 for the year ended December 31, 2014.

The Company accounts for stock-based compensation related to stock options granted to employees by estimating the fair value of the stock-based awards using the Black-Scholes option pricing model. The fair value of the stock options granted is amortized over the applicable vesting period. The Black-Scholes option pricing model includes assumptions regarding dividend yields, expected volatility, expected option term, expected forfeiture rate and risk-free interest rates. The Company estimates expected volatility based on the historical volatility of comparable publicly traded companies for a period commensurate with the estimated expected option term. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant.



	For the year ended December 31, 2014
Risk-free interest rate	1.4	%
Expected volatility	63.0	%
Expected term (in years)	4
Expected dividend yield	3.7	%

No stock options were granted during the years ended December 31, 2015 or 2013.

Loss Per Share

12 Months Ended

Dec. 31, 2015

Earnings Per Share [Abstract]

Loss Per Share

LOSS PER SHARE

Loss per share (“EPS”) is based upon the weighted average shares outstanding. Unvested RSAs that contain non-forfeitable rights to dividends are treated as participating securities and are included in the EPS computation using the two-class method, to the extent that there are undistributed earnings available as such securities do not participate in losses.

Basic and diluted loss per share for the years ended December 31, 2015 and 2014 was calculated as follows:



	Year Ended December 31,
(In thousands, except per share amounts)	2015			2014
Basic and diluted loss per share¹:
Net loss attributable to Class A common stockholders	$	(79,886	)	$	(25,617	)
Less: dividends paid on Class A shares and participating RSAs	(74,377		)	—
Undistributed loss attributable to Class A shares	$	(154,263	)	$	(25,617	)

Weighted average basic and diluted Class A shares outstanding	65,883			29,602

Distributed earnings per share	$	1.09		$	—
Undistributed loss per share	(2.34		)	(0.87		)
Basic and diluted loss per share	$	(1.25	)	$	(0.87	)

———

(1)

The computations for diluted loss per share for the year ended December 31, 2015 exclude 60,364,154 shares of Class B common stock, 1,334,158 unvested RSAs, 3,208,394 unvested RSUs and 56,250 vested and exercisable options to purchase the Company's shares because the effect would have been anti-dilutive. The computations for diluted loss per share for the year ended December 31, 2014 exclude 64,526,654 shares of Class B common stock, 5,840,000 shares of Class B1 common stock, 3,485,155 unvested RSAs, 825,943 unvested RSUs and 150,000 options to purchase the Company's shares because the effect would have been anti-dilutive.

Non-controlling Interests

12 Months Ended

Dec. 31, 2015

Noncontrolling Interest [Abstract]

Non-controlling Interests

NON-CONTROLLING INTERESTS

Non-controlling Interests

Non-controlling interests represent the portion of net assets in consolidated entities that are not owned by the Company. The following table presents the non-controlling interest balances by entity, reported in stockholders’ equity in the consolidated balance sheets as of December 31, 2015 and 2014:



(In thousands)	December 31, 2015		December 31, 2014
Non-controlling interests in Terra LLC:
SunEdison	$	897,409	$	722,342
Riverstone	—		65,376
Total non-controlling interests in Terra LLC¹	897,409		787,718
Total non-controlling interests in renewable energy facilities	858,117		256,811
Total non-controlling interests	$	1,755,526	$	1,044,529

———


(1)	Reflects an equity reallocation of $170.3 million and $139.1 million as of December 31, 2015 and 2014, respectively, due to an adjustment of capital balances to reflect respective ownership percentages as of each balance sheet date.

As of December 31, 2015, TerraForm Power owned 56.9% of Terra LLC and consolidated the results of Terra LLC through its controlling interest, with SunEdison's 43.1% interest shown as a non-controlling interest.

Non-controlling Interest Buyout

On March 31, 2015, the Company completed the buyout of approximately 92% of one of the partners' tax equity ownership interest in the Company's Kaheawa Wind Power I facility. The value associated with the buyout was deemed to be the fair value of the non-controlling interest as of the acquisition date. The cash paid for this buyout was $54.7 million.

Redeemable Non-controlling Interests

Non-controlling interests in subsidiaries that are redeemable either at the option of the holder or at fixed and determinable prices at certain dates are classified as redeemable non-controlling interests in subsidiaries between liabilities and stockholders' equity in the consolidated balance sheets. The redeemable non-controlling interests in subsidiaries balance is determined using the hypothetical liquidation at book value method for the VIE funds or allocation of share of income or losses in other subsidiaries subsequent to initial recognition; however, the non-controlling interests balance cannot be less than the estimated redemption value.

The following table presents the activity of the redeemable non-controlling interest balance reported on the consolidated balance sheets as of December 31, 2015 and 2014:



	Redeemable Non-controlling Interests
(In thousands)	Capital			Accumulated Deficit		Total
Balance as of December 31, 2013	$	—		$	—	$	—
Consolidation of redeemable non-controlling interests in acquired renewable energy facilities	24,338			—		24,338
Balance as of December 31, 2014	$	24,338		$	—	$	24,338
Consolidation of redeemable non-controlling interests in acquired renewable energy facilities	151,408			—		151,408
Sale of membership interests in renewable energy facilities	3,032			—		3,032
Repurchase of non-controlling interest	(8,504		)	—		(8,504		)
Distributions	(2,764		)	—		(2,764		)
Currency translation adjustment	(311		)	—		(311		)
Net income	—			8,512		8,512
Balance as of December 31, 2015	$	167,199		$	8,512	$	175,711

Commitments and Contingencies

12 Months Ended

Dec. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

COMMITMENTS AND CONTINGENCIES

Letters of Credit

The Company's customers, vendors and regulatory agencies often require the Company to post letters of credit in order to guarantee performance under relevant contracts and agreements. The Company is also required to post letters of credit to secure obligations under various swap agreements and leases and may, from time to time, decide to post letters of credit in lieu of cash deposits in reserve accounts under certain financing arrangements. The amount that can be drawn under some of these letters of credit may be increased from time to time subject to the satisfaction of certain conditions. As of December 31, 2015, the Company had outstanding letters of credit under the Revolver of $67.4 million and outstanding project-level letters of credit of $96.1 million.

Guarantee Agreements

The Company and its subsidiaries have provided guarantees to certain of its institutional tax equity investors and financing parties in connection with its tax equity financing transactions. These guarantees do not guarantee the returns targeted by the tax equity investors or financing parties, but rather to support any potential indemnity payments payable under the tax equity agreements, including related to management of tax partnerships and recapture of tax credits or renewable energy grants in connection with transfers of the Company’s direct or indirect ownership interests in the tax partnerships to entities that are not qualified to receive those tax benefits. The Company and its subsidiaries have also provided guarantees in connection with acquisitions of third party assets or to support project contractual obligations, including renewable energy credit sales agreements, and may provide additional guarantees in connection with future acquisitions or project contractual obligations. The Company and its subsidiaries have also provided other capped or limited contingent guarantees and other support obligations with respect to certain project-level indebtedness. Additionally, during the year ended December 31, 2015, the Company provided a guaranty to SunEdison; see Note 19. Related Parties for additional discussion of this guaranty.

Commitments to Acquire Renewable Energy Facilities

As of December 31, 2015, the Company had open commitments of $240.9 million in the aggregate to acquire renewable energy facilities with a combined nameplate capacity of 195.5 MW from SunEdison, which include commitments that were significantly reduced in 2016. See Note 19. Related Parties for additional discussion of these commitments.

As of December 31, 2015, the Company had committed $62.8 million in cash to acquire renewable energy facilities from third parties with a combined nameplate capacity of 99.3 MW. Of this, the Company acquired solar generation facilities with a combined nameplate capacity of 0.7 MW during the first quarter of 2016 for $4.1 million. The remaining $58.7 million was committed to acquire two wind power plants with a combined nameplate capacity of 98.6 MW from Invenergy Wind. This commitment expired on July 1, 2016. As a result, while the purchase agreement remains in force, Invenergy and the Company now have the right to terminate the purchase agreement with respect to these two additional facilities at any time and may determine not to consummate the acquisition. If the purchase agreement is terminated by either party, the Company will not purchase these facilities. See Note 4. Acquisitions for additional discussion of this commitment.

Operating Leases

The Company leases land and buildings under operating leases. Total rental expense was $12.2 million, $1.0 million and $0.1 million during the years ended December 31, 2015, 2014 and 2013, respectively. The following table summarizes the Company's future commitments under operating leases as of December 31, 2015.



(in thousands)	Rent
2016	$	17,695
2017	18,101
2018	18,398
2019	18,692
2020	18,995
Thereafter	278,999
Total	$	370,880

Legal Proceedings

The Company is not a party to any legal proceedings other than various administrative and regulatory proceedings arising in the ordinary course of the Company's business or as described below. While the Company cannot predict with certainty the ultimate resolution of such proceedings or other claims asserted against the Company, certain of the claims, if adversely concluded, could result in substantial damages or other relief.

Stockholder Derivative Lawsuits

On December 28, 2015, a verified stockholder derivative complaint (Central Laborers’ Pension Fund et al. v. Peter Blackmore et al., Case No. 11847) on behalf of the Company, was filed in the Court of Chancery in the State of Delaware against the Company, as nominal defendant, and SunEdison, and certain individual directors of the Company, as defendants (the “Central Laborers’ Proceeding”). The lawsuit alleges that certain members of the Company’s board of directors breached their fiduciary duties of loyalty and care by agreeing to enter into an agreement (the “July Vivint Transaction”) with SunEdison on July 20, 2015 to acquire certain residential rooftop solar assets (the “Vivint Assets”) that SunEdison was acquiring as part of SunEdison’s acquisition of Vivint Solar, Inc. (“Vivint Solar”), by agreeing to terms that were grossly unfair to the Company and designed for the benefit of SunEdison, thereby failing to act in the best interests of the Company. The lawsuit further alleges that the approval of the modifications to the Company’s agreements under the July Vivint Transaction (the “December Vivint Transaction”) by the board of directors of the Company was on terms that are unfair to the Company and improperly favor SunEdison to the detriment of the Company and its stockholders. The complaint further alleges that SunEdison, as the Company’s controlling stockholder, breached its fiduciary duty not to advance SunEdison’s interest at the expense of the Company’s interests by causing the Company to (i) overpay to acquire assets in both the July Vivint Transaction and in the December Vivint Transaction in order to finance SunEdison’s purchase of Vivint Solar, and (ii) commit to purchase future residential solar generation facilities from SunEdison over the next five years so that SunEdison could use the Company’s commitment to acquire a loan to partially cover its financial obligations in its transaction to acquire Vivint Solar. The plaintiffs in the lawsuit seek damages for the Company for the damages the Company has and will suffer as a result of the defendants’ breaches of fiduciary duty. The lawsuit also seeks an award of the plaintiffs’ costs and disbursements, including attorneys’ fees and expenses.

On January 12, 2016, a verified stockholder derivative complaint (Appaloosa Investment Limited Partnership I et al. v. SunEdison, Inc. et al., Case No. 11898) on behalf of the Company was filed in the Court of Chancery in the State of Delaware against the Company, as nominal defendant, and against SunEdison and three of the Company’s individual directors, as defendants (the “Appaloosa Proceeding”). The lawsuit alleges that SunEdison, as the Company’s controlling stockholder, breached its fiduciary duties to the Company and its minority stockholders by causing the Company, amongst other things, to (i) enter into an amended transaction to acquire the Vivint Assets from SunEdison for its benefits at the expense of the Company’s interests, (ii) purchase the Vivint Assets at an unfair price, and (iii) agree to an unfair Take/Pay arrangement so that SunEdison could use such commitment by the Company to acquire a loan to partially cover its financial obligations in connection with its own contemplated merger with Vivint Solar, for which SunEdison never compensated the Company. The lawsuit also contends that the current members of the Corporate Governance and Conflicts Committee of the Company’s board of directors breached their fiduciary duty of loyalty to the Company’s minority stockholders by, amongst other things, approving the transaction on terms that are unfair to the Company and improperly favor SunEdison to the detriment of the Company and its stockholders. The lawsuit seeks to enjoin the completion of the transaction, rescission of such transaction or, alternatively, awarding rescissory damages, in the event it is consummated. The lawsuit also seeks an award of the plaintiffs’ costs and disbursements, including reasonable attorneys’ fees and expenses.

On January 26, 2016, the Delaware Chancery Court consolidated the Appaloosa Proceeding and the Central Laborers’ Proceeding into a single proceeding and named Appaloosa Investment Limited Partnership I as lead plaintiff and named counsel to the lead plaintiff as lead counsel (the “Consolidated Proceeding”). On February 16, 2016, the Delaware Chancery Court held a hearing on the plaintiff’s motion for a preliminary injunction of the Vivint transaction, and on February 26, 2016, the Chancery Court issued a bench ruling denying plaintiff’s motion for a preliminary injunction. In that ruling, the court concluded that the plaintiffs had not demonstrated that irreparable harm would result if the court failed to preliminarily enjoin the Company’s purchase of the Purchased Subsidiaries under the Amended Purchase Agreement with SunEdison and the Company’s entry into the take/pay transaction pursuant to the Amended and Restated Interim Agreement with SunEdison (collectively, the “Challenged Transaction”).

Following the termination of the Vivint acquisition, the Plaintiffs filed an amended complaint alleging that SunEdison and certain director defendants breached their fiduciary duties by engaging in the Challenged Transaction and associated management changes. The Plaintiffs amended complaint sought money damages to be determined at trial and equitable relief intended to undo those management changes and to require that the Conflicts Committee of the Company be chosen by the majority of the Company’s Class A shareholders. On April 20, 2016, the Plaintiffs filed a second amended complaint that added allegations against certain of the Company’s directors for failing to appoint new members to the Conflicts Committee following the appointment of the current members of the Conflicts Committee to the then newly created Office of the Chairman. Effective April 21, 2016, the Office of the Chairman was abolished, and the board of directors of the Company confirmed and ratified that Peter Blackmore was serving as the Company’s Chairman and Interim Chief Executive Officer.

On June 20, 2016, the Defendants filed a briefing in support of motions to dismiss the case. On August 25, 2015, the parties informed the Delaware Chancery Court that they are discussing settlement. In light of these settlement discussions, the court suspended the deadlines associated with the pending motions to dismiss. On September 27, 2016, the Company reached a settlement agreement with Appaloosa Investment Limited Partnership I to resolve its stockholder derivative suit, as well as derivative claims by stockholders relating to the Vivint Solar transaction. The settlement is subject to approval by the Delaware Chancery Court. A hearing will be held before the Chancery Court on December 19, 2016 to determine whether the court should approve the proposed settlement.

Securities Class Action

On April 4, 2016, a securities class action under federal securities laws (Chamblee v. TerraForm Power, Inc., et al., Case No. 1:16-cv-00981-JFM) was filed in the United States District Court for the District of Maryland against the Company and two of its former officers (one of which was also a director of the Company) asserting claims under Section 10(b) and 20(a) of the Securities and Exchange Act of 1934 and SEC Rule 10b-5 on behalf of a putative class. The Complaint alleges that the defendants made materially false and misleading statements regarding the Company’s business, operational and compliance policies, including with respect to disclosures regarding SunEdison’s internal controls and the Company's reliance on SunEdison. An amended complaint was filed on September 26, 2016 and a former officer and director of the Company were added as defendants. On October 4, 2016, the Judicial Panel on Multidistrict Litigation transferred this matter to the U.S. District Court for the Southern District of New York for consolidated or coordinated pretrial proceedings. While we cannot predict with certainty the ultimate resolution of this proceeding, the Company believes each of the allegations in this complaint are without merit and intends to contest these allegations vigorously.

Settlement Agreement with Latin America Power Holding

On April 20, 2016, TerraForm Power, Inc., (“TERP”) and TerraForm Power, LLC (together with TERP, the “TerraForm Power Parties”) entered into a Settlement and Mutual Release Agreement (the “Settlement Agreement”) with BTG Pactual Brazil Infrastructure Fund II, L.P., P2 Brasil Private Infrastructure Fund II, L.P., P2 Fund II LAP Co-Invest, L.P., P2 II LAP Co-Invest UK, L.P., GMR Holding B.V. (collectively, the “LAP Shareholders”), and Roberto Sahade, LAP’s chief executive officer (together with the LAP Shareholders and the TerraForm Power Parties, the “Parties”). The Settlement Agreement resolves the disputes between the Parties in connection with the previously announced termination of that certain Amended and Restated Share Purchase Agreement, dated May 19, 2015 (the “Share Purchase Agreement”), among SunEdison Holdings Corporation and the LAP Shareholders, and the guarantee issued by TERP in connection therewith, relating to the acquisition of Latin America Power Holding, B.V. (“LAP”), that are the subject of an arbitration proceeding (the “Arbitration”). On March 3, 2016, TERP, SunEdison Holdings Corporation, SunEdison, Inc. and the LAP Shareholders entered into a settlement agreement with respect to the Arbitration (the “March Settlement Agreement”). Subsequent to the execution of the March Settlement Agreement, SunEdison Holdings Corporation failed to make a required payment under the terms of the agreement and as a result the LAP Shareholders recommenced the Arbitration against all parties, including TERP.

Pursuant to the Settlement Agreement, TERP has made a one-time payment to LAP in the amount of $10.0 million in exchange for and contingent on the termination of the Arbitration against TERP. This amount was accrued for as of December 31, 2015 and is reported in general and administrative expenses in the consolidated statement of operations. None of the Parties has admitted to any wrongdoing or liability with respect to the claims asserted in the Arbitration, and the Parties have granted each other full releases of any further obligations under the Share Purchase Agreement and related agreements (including the TERP guarantee). The Settlement Agreement does not impact any claims that the LAP Shareholders or the TerraForm Power Parties may have against SunEdison, Inc. and SunEdison Holdings Corporation in connection with the transactions described above.

Daniel Gerber v. Wiltshire Council

On February 23, 2016, the U.K. Court of Appeals granted the appeal by the Company and the relevant local governmental authority and overturned an earlier decision by the U.K. High Court to quash (nullify) the planning permission necessary to build the Company’s 11.1 MW Norrington solar generation facility in Wiltshire, England. Among other things, the Court of Appeals held that the lower court erred in extending the time for the plaintiff to challenge the planning permission beyond the statutory appeal period. As a result of the successful appeal, the validity of the planning permission was reconfirmed. The plaintiff sought permission of the Supreme Court to appeal the decision of the Court of Appeals; however, permission was denied by the Supreme Court. The Company will, however, have to seek certain amendments to the permit or modify certain aspects of the power plant to come in full compliance with its terms.

Claim relating to First Wind Acquisition

On May 27, 2016, D.E. Shaw Composite Holdings, L.L.C. and Madison Dearborn Capital Partners IV, L.P., as the representatives of the sellers (the “First Wind Sellers”) filed an amended complaint for declaratory judgment against the Company and Terra LLC in the Supreme Court of the State of New York alleging breach of contract with respect to the Purchase and Sale Agreement, dated as of November 17, 2014 (the “FW Purchase Agreement”) between, among others, SunEdison, the Company and Terra LLC and the First Wind Sellers. The amended complaint alleges that Terra LLC and SunEdison became jointly obligated to make $231.0 million in earn-out payments in respect of certain development assets SunEdison acquired from the First Wind Sellers under the FW Purchase Agreement, when those payments were purportedly accelerated by SunEdison's bankruptcy and by the resignations of two SunEdison employees. The amended complaint further alleges that the Company, as guarantor of certain Terra LLC obligations under the FW Purchase Agreement, is liable for this sum. Defendants filed a motion to dismiss the amended complaint on July 5, 2016, on the ground that, among other things, SunEdison is a necessary party to this action. Plaintiffs filed an opposition to the motion to dismiss on August 22, 2016. Defendants filed their reply on September 12, 2016. A hearing on the motion to dismiss is currently scheduled to take place on January 24, 2017.

The Company believes the First Wind Sellers’ allegation is without merit and will contest the claim and allegations vigorously. However, we cannot predict with certainty the ultimate resolution of any proceedings brought in connection with such a claim.

Whistleblower Complaint By Francisco Perez Gundin

On May 18, 2016, the Company’s former Director and Chief Operating Officer, Francisco Perez Gundin (“Perez”), filed a Complaint against the Company, TerraForm Global, Inc., and certain individuals, with the United States Department of Labor. The Complaint alleges that Defendants engaged in a retaliatory termination of Mr. Perez's employment after he allegedly voiced concerns to SunEdison’s Board of Directors about public representations made by SunEdison officers regarding SunEdison’s liquidity position, and after he allegedly voiced his opposition to transactions that he alleges were self-interested and which he alleges SunEdison forced on the Company. He alleges that the Company participated in SunEdison’s retaliatory termination by constructively terminating his position as Chief Operating Officer of the Company in connection with SunEdison’s constructive termination of his employment. He seeks lost wages, bonuses, benefits, and other money that he alleges that he would have received if he had not been subjected to the allegedly retaliatory termination.

The matter is being adjudicated in an administrative proceeding before the Occupational Safety and Health Administration agency of the United States Department of Labor. The Company’s Position Statement in response to the Complaint was filed in October of 2016. The Company believes Mr. Perez's claims are without merit and is contesting them. However, the Company cannot predict with certainty the ultimate resolution of this proceeding.

Whistleblower Complaint By Carlos Domenech Zornoza

On May 10, 2016, the Company’s former Director and Chief Executive Officer, Carlos Domenech Zornoza (“Domenech”), filed a Complaint against the Company, TerraForm Global, Inc., and certain individuals, with the United States Department of Labor. The Complaint alleges that Defendants engaged in a retaliatory termination of Mr. Domenech’s employment on November 20, 2015 after he allegedly voiced concerns to SunEdison’s Board of Directors about public representations made by SunEdison officers regarding SunEdison’s liquidity position, and after he allegedly voiced his opposition to transactions that he alleges were self-interested and which he alleges SunEdison forced on the Company. He alleges that the Company participated in SunEdison’s retaliatory termination by terminating his position as Chief Executive Officer of the Company in connection with SunEdison’s termination of his employment. He seeks lost wages, bonuses, benefits, and other money that he alleges that he would have received if he had not been subjected to the allegedly retaliatory termination.

The Company believes that Mr. Domenech's claims are without merit and is contesting them. However, the Company cannot predict with certainty the ultimate resolution of this proceeding.

Eastern Maine Electric Cooperative Litigation

On November 21, 2016, the Penobscot County Maine Superior Court entered judgment in the amount of $13.6 million against First Wind Holdings, LLC (“First Wind”), an indirect subsidiary of SunEdison, Inc., and several subsidiaries of the Company. The plaintiff filed judgment liens against the defendants which will stay outstanding through the appeals process. The action involved a claimed breach of contract arising out of a contract between First Wind and Eastern Maine Electric Cooperative, Inc. (“EMEC”), under which First Wind, on behalf of itself and its then wholly-owned subsidiaries, agreed to negotiate a definitive agreement to transfer to EMEC a portion of a transmission line. The transmission line is owned, in part, by one of the Company's subsidiaries, and is the sole means of transmitting power from the Rollins, Stetson I, and Stetson II wind farms. The subsidiaries that own these wind farms and the transmission line were acquired by the Company as part of the Company's acquisition of certain of the operating assets of First Wind Holdings. The Company believes all the defendants acted in good faith and the Company’s subsidiaries that are defendants in the action intend to continue to vigorously contest the allegations and appeal the verdict. The judgment was for money damages and, if upheld on appeal, would not be expected to result in a loss of the use of the transmission line by the Company's subsidiaries. The amount of the judgment was accrued for as of December 31, 2015 and is reported in general and administrative expenses in the consolidated statement of operations.

Avoidance Actions

On November 7, 2016, the unsecured creditors’ committee in the SunEdison Bankruptcy filed a motion with the bankruptcy court seeking standing to assert against the Company, on behalf of SunEdison, avoidance claims arising from payments and other intercompany transactions between the Company and SunEdison dating back to the Company’s initial public offering and including drop-down transactions involving the sale of renewable energy facilities by SunEdison to the Company. The Company’s objection to the standing motion was filed on November 29, 2016. A hearing on the motion is scheduled to take place on December 6, 2016. The Company expects to vigorously contest this standing motion and, if standing is granted, the underlying avoidance claims. Furthermore, the Company is currently engaged in settlement discussions with SunEdison and certain of SunEdison’s stakeholders to resolve, among other issues, intercompany claims and defenses between the Company and SunEdison. While these settlement discussions remain ongoing and there can be no guaranty that a settlement will be reached, the Company believes that a successful settlement could facilitate the Company’s exploration of strategic alternatives. Any settlement would be subject to the approval of the bankruptcy court in the SunEdison Bankruptcy. Given the preliminary nature of the claims, the Company is unable to provide any assurances as to the ultimate outcome of these claims or that an adverse resolution of a legal proceeding, if commenced, would not have a material adverse effect on the Company’s consolidated financial position and results of operations.

Related Parties

12 Months Ended

Dec. 31, 2015

Related Parties

RELATED PARTIES

SunEdison Bankruptcy

The Company is not a part of the SunEdison Bankruptcy and has no plans to file for bankruptcy itself. The Company does not rely substantially on SunEdison for funding or liquidity and believes that the Company will have sufficient liquidity to support its ongoing operations. The Company believes its equity interests in its renewable energy facilities that are legally owned by the Company’s subsidiaries are not available to satisfy the claims of the creditors of the SunEdison Bankruptcy. However, there is a risk that an interested party in the SunEdison Bankruptcy could request that the assets and liabilities of the Company be substantively consolidated with SunEdison and that the Company and/or its assets and liabilities be included in the SunEdison Bankruptcy. While it has not been requested to date and the Company believes there is no basis for substantive consolidation in its circumstances, the Company cannot assure you that substantive consolidation will not be requested in the future or that the bankruptcy court would not consider it.

As discussed below, the Company and SunEdison are parties to multiple agreements, including project-level O&M and asset management agreements, engineering procurement and construction agreements, and other support agreements, including modules warranties with respect to SunEdison produced modules. Moreover, at the time of the Company's IPO, SunEdison and the Company entered into the Sponsor Arrangement, a complex contractual arrangement setting forth the terms and conditions of SunEdison's sponsorship of the Company, which included, among other things, the Management Services Agreement ("MSA"), Interest Payment Agreement and Support Agreement. The Company believes that the Sponsor Arrangement comprises a single integrated transaction. The agreements comprising the Sponsor Arrangement are set forth in separate documents and discussed individually in this Form 10-K. However, the elements of the Sponsor Arrangement are closely related and a default under one element may be a defense to, or excuse performance under, another element. SunEdison and its various stakeholders have expressed disagreement with this view of the Sponsor Arrangements and can be expected to contest any such assertion in connection with the SunEdison Bankruptcy.

During the SunEdison Bankruptcy, SunEdison has not performed substantially as obligated under its agreements with the Company, including under the Sponsor Arrangement and certain O&M and asset management arrangements. SunEdison's failure to perform substantially as obligated under its agreements with the Company, including under the Sponsor Arrangement, project-level O&M and asset management agreements and other support agreements, may have a material adverse effect on the Company. Despite these adverse effects, the Company expects that it will be able to operate its business without the support of SunEdison pursuant to the plans for transitioning away from reliance on SunEdison that it is in the process of implementing. Refer to Note 1. Nature of Operations for discussion regarding these plans.

On September 25, 2016, the Company filed its initial proof of claim in the SunEdison Bankruptcy case, which was amended on October 7, 2016. Refer to Note 1. Nature of Operations for discussion regarding this initial proof of claim and settlement discussions between the Company and SunEdison.

Incentive Revenue

Certain solar renewable energy certificates ("SRECs") are sold to SunEdison under contractual arrangements at fixed prices. Revenue from the sale of SRECs to affiliates was $0.2 million, $1.1 million and $0.9 million during the years ended December 31, 2015, 2014 and 2013, respectively, and is reported within operating revenues, net in the consolidated statements of operations.

Management Services Agreement

Prior to the IPO, general and administrative expenses - affiliate represent amounts allocated from SunEdison for general corporate overhead costs attributable to the operations of the Predecessor. Subsequent to the completion of the IPO, general and administrative expenses - affiliate represent costs incurred by SunEdison for services provided to the Company pursuant to the MSA. Pursuant to the MSA, SunEdison agreed to provide or arrange for other service providers to provide management and administrative services including legal, accounting, tax, treasury, project finance, information technology, insurance, employee benefit costs, communications, human resources, and procurement to the Company. As consideration for the services provided, the Company agreed to pay SunEdison a base management fee as follows: (i) 2.5% of the Company's cash available for distribution in 2015, 2016, and 2017 (not to exceed $4.0 million in 2015, $7.0 million in 2016 or $9.0 million in 2017), and (ii) an amount equal to SunEdison's or other service provider's actual cost in 2018 and thereafter. Subsequent to the SunEdison Bankruptcy, SunEdison continues to provide some management and administrative services to the Company, including employee compensation and benefit costs, human resources, information technology and communications, but has stopped providing (or reimbursing the Company) for other services pursuant to the MSA. If SunEdison rejects, or seeks to substantially renegotiate the MSA due to the SunEdison Bankruptcy, the Company may bear these actual costs in future periods.

General and administrative expenses - affiliate were $55.3 million, $19.1 million and $5.2 million for the years ended December 31, 2015, 2014 and 2013, respectively, as reported in the consolidated statements of operations. Pursuant to the MSA, cash consideration paid by the Company to SunEdison for these services for the year ended December 31, 2015 totaled $4.0 million and general and administrative expenses - affiliate in excess of cash consideration paid have been treated as an equity contribution from SunEdison within Net SunEdison investment on the consolidated statement of stockholders' equity. There was no cash consideration paid to SunEdison for these services for the period from July 24, 2014 through December 31, 2014.

Operations and Maintenance ("O&M") and Asset Management Services

O&M services, as well as asset management services, are provided to the Company by SunEdison pursuant to contractual agreements. Costs incurred for these services were $19.9 million, $8.1 million and $1.1 million during the years ended December 31, 2015, 2014 and 2013, respectively, and are reported as cost of operations - affiliate in the consolidated statements of operations. In addition, in conjunction with the First Wind Acquisition, SunEdison committed to reimburse the Company for capital expenditures and operations and maintenance labor fees in excess of budgeted amounts (not to exceed $53.9 million through 2019) for certain of its wind power plants. During the year ended December 31, 2015, the Company received contributions pursuant to this agreement of $4.3 million. The total amount related to capital expenditures of $50.0 million was initially recognized in renewable energy facilities as a prepaid warranty as the amount was part of the consideration paid on the acquisition date. As a result of the SunEdison Bankruptcy, the Company recorded a loss of $45.4 million during the year ended December 31, 2015 related to the write-off of the remaining balance of the prepaid warranty, which was net of depreciation expense of $1.9 million and capital expenditure reimbursements received of $2.7 million, and is reported as loss on prepaid warranty - affiliate in the consolidated statement of operations.

Engineering, Procurement and Construction Contracts and Module Warranties

SunEdison served as the prime construction contractor for most of the Company's renewable energy facilities acquired from SunEdison pursuant to engineering, procurement and construction contracts with the Company's project-level subsidiaries. These contracts are generally fixed price, turn-key construction contracts that include workmanship and other warranties with respect to the design and construction of the facilities that survive for a period of time after the completion of construction. These contracts or related contracts (including operation and maintenance agreements) also often include production or availability guarantees with respect to the output or availability of the facility that survive completion of construction. Moreover, the Company also generally obtained solar module warranties from SunEdison, including workmanship warranties and output guarantees, for those solar facilities that the Company acquired from SunEdison that utilized SunEdison modules. The SunEdison Bankruptcy will likely reduce or eliminate the Company's potential recoveries on claims under these agreements and warranties. Third party insurance has been procured by SunEdison to back-stop payment of warranty claims for SunEdison modules purchased from January of 2011 through January of 2015.

Interest Payment Agreement

Immediately prior to the completion of the IPO on July 23, 2014, Terra LLC and Terra Operating LLC entered into an interest payment agreement (the "Interest Payment Agreement") with SunEdison, pursuant to which SunEdison would pay all of the scheduled interest on the Term Loan through the third anniversary of Terra LLC and Terra Operating LLC entering into the Term Loan, up to an aggregate of $48.0 million over such period (plus any interest due on any payment not remitted when due). Interest expense incurred under the Term Loan is reflected in the consolidated statement of operations and the reimbursement for such costs is treated as an equity contribution from SunEdison, as reflected within Net SunEdison investment on the consolidated statement of stockholders' equity. The Company received an equity contribution of $4.0 million from SunEdison pursuant to the Interest Payment Agreement for the year ended December 31, 2015. During the period from July 24, 2014 to December 31, 2014, the Company received equity contributions totaling $5.4 million pursuant to the Interest Payment Agreement.

On January 28, 2015, Terra LLC and Terra Operating LLC entered into the Amended and Restated Interest Payment Agreement (the “Amended Interest Payment Agreement”) with SunEdison. Pursuant to the Amended Interest Payment Agreement, SunEdison agreed to pay amounts equal to a portion of each scheduled interest payment of the Senior Notes due 2023, beginning with the first scheduled interest payment on August 1, 2015, and continuing through the scheduled interest payment on August 1, 2017. Amounts will be paid by SunEdison as follows: (1) in respect of the first scheduled interest payment, $16.0 million, less amounts already paid by SunEdison under the Interest Payment Agreement, (2) in respect of each scheduled interest payment in 2016, $8.0 million, and (3) in respect of each scheduled interest payment in 2017, $8.0 million, provided that the maximum amount payable by SunEdison under the Amended Interest Payment Agreement (inclusive of amounts already paid under the Interest Payment Agreement) may not exceed $48.0 million (plus any interest due on any payment not remitted when due). SunEdison will also not be obligated to pay any amounts payable under the Senior Notes due 2023 in connection with an acceleration of the indebtedness thereunder. The Company received equity contributions totaling $6.6 million from SunEdison pursuant to the Amended Interest Payment Agreement during the period from January 28, 2015 to December 31, 2015. As of December 31, 2015, the Company had received a cumulative of $16.0 million under the Interest Payment Agreement and Amended Interest Payment Agreement from SunEdison. On February 3, 2016, the Company received $8.0 million from SunEdison in accordance with the Amended Interest Payment Agreement and SunEdison's remaining obligation pursuant to this agreement is $24.0 million of scheduled payments due in future periods.

On July 29, 2016, SunEdison delivered a notice purporting to terminate the Amended Interest Payment Agreement. The notice alleges that SunEdison's bankruptcy permits termination as of right without following the bankruptcy procedures for rejection of executory contracts. Although the Company does not expect SunEdison to perform under the Amended Interest Payment Agreement going forward, it intends to contest the validity of the termination notice and asserted a claim in the SunEdison Bankruptcy as discussed in Note 1. Nature of Operations.

Support Agreement and Intercompany Agreement

The Company entered into a project support agreement with SunEdison (the "Support Agreement") on July 23, 2014, which provides the Company the option to purchase additional renewable energy facilities from SunEdison in 2015 and 2016. The Support Agreement also provides the Company a right of first offer with respect to certain other renewable energy facilities. During the year ended December 31, 2015, the Company acquired renewable energy facilities with a combined nameplate capacity of 350.9 MW from SunEdison under the Project Support Agreement (see Note 3. Transactions Between Entities Under Common Control).

On January 9, 2015, the Company paid $18.0 million to SunEdison as a deposit for the future acquisition of a 41.7 MW solar generation facility under the Support Agreement. SunEdison refunded the full amount of the deposit to the Company on September 15, 2015 due to the Company's election not to acquire this asset. Subsequent to December 31, 2015, the Company elected to waive its right to acquire this facility.

In connection with the First Wind Acquisition, the Company and SunEdison entered into an agreement (the "Intercompany Agreement") pursuant to which the Company was granted the option to purchase additional renewable energy facilities in the First Wind pipeline from SunEdison. During the year ended December 31, 2015, the Company acquired renewable energy facilities with a combined nameplate capacity of 222.6 MW from SunEdison under the Intercompany Agreement (see Note 3. Transactions Between Entities Under Common Control).

As a result of the SunEdison Bankruptcy, the Company does not expect that it will be able to acquire from SunEdison any additional projects under the Support Agreement or Intercompany Agreement and add such projects to its operating fleet. As the Company's long-term growth strategy is the acquisition of new renewable energy facilities, including under the Support Agreement and Intercompany Agreement, losing its ability to acquire additional projects from SunEdison may negatively impact the Company's ability to grow its portfolio and the Company may be required to seek such growth primarily from third party acquisitions.

As discussed in Note 1. Nature of Operations, on September 25, 2016, the Company filed its initial proof of claim in the SunEdison Bankruptcy case, which was amended on October 7, 2016. This proof of claim asserted claims based on, among other things, SunEdison's breach of the sponsorship arrangement between the Company and SunEdison which included the Support Agreement and Intercompany Agreement.

In addition to the Company's Call Right Projects under the Support Agreement and Intercompany Agreement, the Company's Call Right Projects also include 0.5 GW (net) of operating wind power plants owned by a SunEdison warehouse (the "AP Warehouse"). The legal entities that comprise the AP Warehouse have not filed for bankruptcy. The Company is currently exploring acquiring a ten to twenty percent interest in the Call Right Projects in the AP Warehouse.

Fleet Availability Guarantee Agreement

Immediately prior to the completion of the IPO on July 23, 2014, Terra LLC entered into the Fleet Availability Guarantee Agreement (the "Availability Agreement") with SunEdison. The Availability Agreement requires SunEdison to pay a fee to the Company when the availability of the Company's solar generation facilities serviced by SunEdison is less than 99% for a calendar year. The fee is calculated based on 2% of the O&M service fee for each 0.25% increment below 99% availability. The maximum fee per year allowable under the agreement is $4.5 million. For the year ended December 31, 2015, SunEdison paid the Company a fee of $1.0 million under the terms of the Availability Agreement. The Availability Agreement expired on December 31, 2015.

Guaranty to SunEdison

On May 19, 2015, the Company provided a guaranty in connection with SunEdison’s agreement to acquire from the LAP Shareholders, a 19.0 MW hydroelectricity facility and a 185.0 MW wind power plant in Chile for $195.0 million. In October 2015, SunEdison received a notice from the sellers purporting to terminate the purchase agreement. Following receipt of such notice, SunEdison exercised its right under the purchase agreement to terminate the agreement based on the failure by the sellers to satisfy certain conditions precedent to closing. In connection with this transaction, the Company and the LAP shareholders entered into the Settlement Agreement as disclosed in Settlement Agreement with Latin America Power Holding in Note 18. Commitments and Contingencies, which resulted in a release of all claims by the LAP shareholders under the guaranty.

Due to SunEdison, net

Certain of the Company's expenses are reimbursed by SunEdison pursuant to the MSA and any expenses not reimbursed by SunEdison as of the balance sheet date are reported as Due from SunEdison, net. Additionally, all amounts incurred by the Company and not paid as of the balance sheet date for renewable energy facilities acquired from SunEdison or for asset management and O&M services received from SunEdison are reported as Due to SunEdison, net. As of December 31, 2015 and 2014, the Company owed $20.3 million and $194.4 million, respectively, which is reported as Due to SunEdison, net in the consolidated balance sheets. As a result of the SunEdison Bankruptcy, the Company recognized an $11.3 million loss on investment within loss on investments and receivables - affiliate in the consolidated statement of operations, as a result of residential project cancellations. Further, the Company recognized an additional $4.8 million loss within loss on investments and receivables - affiliate related to recording a bad debt reserve for outstanding receivables from the SunEdison Debtors.

Net SunEdison Investment

During the year ended December 31, 2015, SunEdison made net contributions to Terra LLC pursuant to the related party agreements discussed above and in connection with drop down acquisitions. The following table illustrates the detail of Net SunEdison investment for the year ended December 31, 2015 and December 31, 2014 as reported on the consolidated statements of stockholders' equity:



	Year ended December 31,
(in thousands)	2015			2014
MSA - General and administrative expenses - affiliate¹	$	51,330		$	19,144
MSA - Failed deal costs²	6,069			—
Interest Payment Agreement and Amended Interest Payment Agreement³	18,597			5,400
First Wind capital expenditures and O&M labor fees⁴	4,303			—
TerraForm Power, Inc. equity awards distributed to SunEdison⁵	(10,509		)	—
Deemed contribution related to acquisitions from SunEdison⁶	41,773			1,498
Lindsay debt repayment⁷	40,306			—
Contribution in exchange for Class B common stock and Class B units at IPO⁸	—			398,902
Other	1,532			—
Net SunEdison investment	$	153,401		$	424,944

———


(1)	Represents total general and administrative expenses - affiliate in excess of cash paid to SunEdison pursuant to the MSA agreement ($4.0 million paid during fiscal 2015 and no cash payments during fiscal 2014).


(2)	Represents acquisition costs related to failed deals that were paid by SunEdison. Such costs are reimbursable by SunEdison under the MSA.


(3)	Represents contributions received pursuant to the Interest Payment Agreement and the Amended Interest Payment Agreement. $8.0 million of the amount for the year ended December 31, 2015 was not received in cash from SunEdison until February 3, 2016 and a receivable from SunEdison was recorded within Due to SunEdison, net as of December 31, 2015.


(4)	Represents contributions received for capital expenditures and operations and maintenance labor fees in excess of budgeted amounts for certain of the Company's wind power plants, which SunEdison committed to reimburse the Company for in conjunction with the First Wind Acquisition.


(5)	Represents stock-based compensation cost related to equity awards in the Company's stock which has been allocated to SunEdison.


(6)	Represents the difference between the cash purchase price and historical cost of the net assets acquired from SunEdison.


(7)	SunEdison repaid the remaining outstanding principal balance and interest due on the SunE Perpetual Lindsay construction term loan on the Company's behalf as required pursuant to the terms of a project investment agreement entered into prior to the IPO of the Company.


(8)	Represents SunEdison's net contribution at IPO in exchange for Class B common stock of the Company and Class B units of Terra LLC.

Distributions to SunEdison

During the year ended December 31, 2015, Terra LLC paid distributions of $58.3 million to its Class B unit holder, SunEdison.

Incentive Distribution Rights

Immediately prior to the completion of the IPO on July 23, 2014, Terra LLC entered into the Amended and Restated Operating Agreement of Terra LLC which granted SunEdison 100% of the Incentive Distribution Rights ("IDRs") of Terra LLC. IDRs represent the right to receive increasing percentages (15.0%, 25.0% and 50.0%) of Terra LLC’s quarterly distributions after the Class A Units, Class B units, and Class B1 units of Terra LLC have received quarterly distributions in an amount equal to $0.2257 per unit (the "Minimum Quarterly Distribution") and the target distribution levels have been achieved. As of December 31, 2015 and 2014, SunEdison held 100% of the IDRs. SunEdison has pledged the IDRs as collateral under its DIP financing and its first and second lien credit facilities and second lien secured notes. As of December 31, 2015, there were no Class B1 units of Terra LLC outstanding. There were no payments for IDRs made by the Company during the years ended December 31, 2015, 2014 and 2013.

Commitments to Acquire Renewable Energy Facilities from SunEdison

As of December 31, 2015, the Company had open commitments of $240.9 million in the aggregate to acquire renewable energy facilities with a combined nameplate capacity of 195.5 MW from SunEdison, as outlined below. These commitments included the following:


•	$32.1 million to acquire 20 distributed generation solar facilities with combined nameplate capacity of 17.7 MW,


•	$3.8 million to acquire additional residential solar generation facilities with a to-be-determined nameplate capacity, and,


•	$205.0 million to acquire three utility-scale solar generation facilities with a combined nameplate capacity of 177.8 MW

The commitments above exclude the estimated commitment of $814.8 million to acquire 479.3 MW of residential solar generation facilities that were expected to be acquired from SunEdison upon SunEdison's merger with Vivint Solar Inc. due to the merger being terminated on March 7, 2016 (see Note 4. Acquisitions). These commitments also exclude the cash of $16.9 million due to SunEdison for renewable energy facilities acquired from SunEdison during the year ended December 31, 2015 (see Note 3. Transactions Between Entities Under Common Control).

On October 26, 2015, SunEdison entered into a master purchase and sale agreement ("MPSA") with a partnership owned predominately by an investment fund managed by J.P. Morgan Asset Management - Global Real Assets Investments. Pursuant to the MPSA, the partnership agreed to purchase, subject to customary closing conditions, including receipt of regulatory approvals, three of the wind power plants (Bingham, Oakfield and South Plains II). These assets have a combined nameplate capacity of 632.4 MW and represented an aggregate commitment by the Company of $779.6 million. The Company's commitment to SunEdison to purchase these assets was terminated upon the closing of the MPSA's for Bingham, Oakfield, and South Plains II on December 9, 10 and 17 of 2015, respectively.

Over the course of 2016, the Company has focused on acquiring, terminating or resolving its commitments to acquire renewable energy facilities from SunEdison in order to align its future commitments with current market conditions. During 2016, all outstanding commitments that existed as of December 31, 2015 expired or were extinguished through termination or project acquisitions, as outlined below:


•	$2.8 million was paid to SunEdison to acquire 3 distributed generation solar facilities with a combined nameplate capacity of 1.2 MW that had an original purchase commitment of $3.1 million as of December 31, 2015,


•	$36.2 million was paid to SunEdison to acquire a utility-scale solar generation facility with a combined nameplate capacity of 18.0 MW from SunEdison that had an original purchase commitment of $36.6 million as of December 31, 2015,


•	$168.4 million of commitments to acquire two utility-scale solar generation facilities with a combined nameplate capacity of 159.8 MW were terminated,


•	$3.8 million of commitments to acquire residential solar generation facilities were terminated and


•	$29.0 million of commitments to acquire 17 distributed generation solar facilities with a combined nameplate capacity of 16.5 MW expired

In connection with the Invenergy Wind Acquisition, Sun Edison LLC, a wholly owned subsidiary of SunEdison, acting as intermediary, entered into certain option arrangements with Invenergy Wind for its remaining 9.9% interest in the acquired companies (the ‘‘Invenergy Wind Interest’’). Simultaneously, Terra LLC entered into a back to back option agreement with Sun Edison LLC on substantially identical terms (collectively the "Option Agreements"). The Option Agreements effectively permit (i) Terra LLC to exercise a call option to purchase the Invenergy Wind Interest over a 180-day period beginning on September 30, 2019, and (ii) Invenergy Wind to exercise a put option with respect to the Invenergy Wind Interest over a 180-day period beginning on September 30, 2018. The exercise prices of the put and call options described above would be based on the determination of the fair market value of the Invenergy Wind Interest at the time the relevant option is exercised, subject to certain minimum and maximum thresholds set forth in the Option Agreements. Sun Edison LLC is a debtor in the SunEdison Bankruptcy. As such, Sun Edison LLC may assume, assume and assign or reject its Option Agreement. If Sun Edison LLC rejects its Option Agreement, the Company would not expect to be obligated to perform on its Option Agreement, although the Company cannot assure that result. Amounts related to the Company's option agreement are not included in the commitment amounts discussed above.

The entire disclosure for related party transactions. Examples of related party transactions include transactions between (a) a parent company and its subsidiary; (b) subsidiaries of a common parent; (c) and entity and its principal owners; and (d) affiliates.

Segment Reporting

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Segment Reporting

SEGMENT REPORTING

The Company has two reportable segments: Solar and Wind. These segments include the Company's entire portfolio of renewable energy facility assets and are determined based on the management approach. This approach designates the internal reporting used by management for making decisions and assessing performance as the source of the reportable segments. The Company’s operating segments consist of Distributed Generation, North America Utility, and International Utility that are aggregated into the Solar reportable segment and Northeast Wind, Central Wind, and Hawaii Wind that are aggregated into the Wind reportable segment. The operating segments have been aggregated as they have similar economic characteristics and meet all of the aggregation criteria. Corporate expenses include general and administrative expenses, acquisition costs, formation and offering related fees and expenses, interest expense on corporate-level indebtedness, stock-based compensation and depreciation, accretion and amortization expense. All net operating revenues for the years ended December 31, 2015 and 2014 were earned by the Company's reportable segments from external customers in the United States (including Puerto Rico), Canada, the United Kingdom and Chile. All net operating revenues for the year ended December 31, 2013 were earned from external customers in the United States (including Puerto Rico).

The following table reflects summarized financial information concerning the Company’s reportable segments for the years ended December 31, 2015, 2014 and 2013:



	Year Ended December 31, 2015
(In thousands)	Solar		Wind			Corporate			Total
Operating revenues, net	$	346,033	$	123,473		$	—		$	469,506
Depreciation, accretion and amortization expense	117,727		43,392			191			161,310
Other operating costs and expenses	65,515		89,831			147,336			302,682
Interest expense, net	71,351		6,991			89,463			167,805
Other non-operating expenses, net	13,986		6,682			38,417			59,085
Income tax benefit¹	—		—			(13,241		)	(13,241		)
Net income (loss)	$	77,454	$	(23,423	)	$	(262,166	)	$	(208,135	)
Cash Flows
Capital expenditures	$	432,807	$	181,594		$	3,248		$	617,649
Balance Sheet
Total assets²	3,907,135		3,769,530			551,558			8,228,223



	Year Ended December 31, 2014
(In thousands)	Solar			Wind		Corporate			Total
Operating revenues, net	$	127,156		$	—	$	—		$	127,156
Depreciation, accretion and amortization expense	41,280			—		—			41,280
Other operating costs and expenses	33,322			—		46,165			79,487
Interest expense, net	56,019			—		30,172			86,191
Other non-operating (income) expenses, net	(6,209		)	—		13,019			6,810
Income tax benefit¹	—			—		(4,689		)	(4,689		)
Net income (loss)	$	2,744		$	—	$	(84,667	)	$	(81,923	)
Cash Flows
Capital expenditures	$	1,122,293		$	—	$	—		$	1,122,293
Balance Sheet
Total assets²	3,166,253			—		514,170			3,680,423



	Year Ended December 31, 2013
(In thousands)	Solar			Wind		Corporate			Total
Operating revenues, net	$	18,716		$	—	$	—		$	18,716
Depreciation, accretion and amortization expense	5,731			—		—			5,731
Other operating costs and expenses	7,627			—		—			7,627
Interest expense, net	8,129			—		—			8,129
Other non-operating income, net	(771		)	—		—			(771		)
Income tax benefit¹	—			—		(88		)	(88		)
Net (loss) income	$	(2,000	)	$	—	$	88		$	(1,912	)
Cash Flows
Capital expenditures	$	210,360		$	—	$	—		$	210,360

———


(1)	Income tax benefit is not allocated to the Company's Solar and Wind segments.


(2)	As of December 31, 2015 and 2014, respectively.

Operating Revenues, net

The following table reflects operating revenues, net for the years ended December 31, 2015, 2014 and 2013 by specific customers exceeding 10% of total operating revenue:

Year Ended December 31,

2015

2014

2013

(In thousands, except for percentages)

Segment

Amount

Percentage

Amount

Percentage

Amount

Percentage

San Diego Gas & Electric

Solar

67,562

14.4

39,574

31.1

N/A

Compañía Minera del Pacífico S.A.

Solar

N/A

23,130

18.2

N/A

Customer A

Solar

N/A

4,196

22.4

Customer B

Solar

N/A

1,761

9.4

Customer C

Solar

N/A

1,726

9.2

———

N/A - These customers did not exceed 10% of total operating revenue for the period indicated above.

The following table reflects operating revenues, net for the years ended December 31, 2015, 2014 and 2013 by geographic location:



	Year Ended December 31,
(In thousands)	2015		2014		2013
United States (including Puerto Rico)	$	368,117	$	87,502	$	18,716
Chile	27,148		23,130		—
United Kingdom	55,542		15,890		—
Canada	18,699		634		—
Total operating revenues, net	$	469,506	$	127,156	$	18,716

Long-lived Assets, Net

Long-lived assets, net consist of renewable energy facilities, intangible assets and goodwill. The following table is a summary of long-lived assets, net by geographic area:



(In thousands)	December 31, 2015		December 31, 2014
United States (including Puerto Rico)	$	5,844,992	$	2,147,877
Chile	181,756		189,221
United Kingdom	659,176		545,848
Canada	418,494		126,939
Total long-lived assets, net	7,104,418		3,009,885
Current assets	954,367		593,772
Other non-current assets	169,438		76,766
Total assets	$	8,228,223	$	3,680,423

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
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Reference 2: http://www.xbrl.org/2003/role/presentationRef
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Reference 3: http://www.xbrl.org/2003/role/presentationRef
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Other Comprehensive (Loss) Income

12 Months Ended

Dec. 31, 2015

Other Comprehensive (Loss) Income

OTHER COMPREHENSIVE (LOSS) INCOME

The following table presents the changes in each component of accumulated other comprehensive (loss) income, net of tax, for the years ended December 31, 2015 and 2014:



(In thousands)	Foreign Currency Translation Adjustments			Hedging Activities			Accumulated Other Comprehensive (Loss) Income
Balance as of December 31, 2013	$	—		$	—		$	—
Net unrealized loss arising during the period	(3,541		)	(1,925		)	(5,466		)
Reclassification of net realized loss into earnings:
Interest expense, net	—			—			—
Other comprehensive loss	(3,541		)	(1,925		)	(5,466		)
Accumulated other comprehensive loss	(3,541		)	(1,925		)	(5,466		)
Less: Other comprehensive loss attributable to non-controlling interests	(2,392		)	(1,437		)	(3,829		)
Balance as of December 31, 2014	$	(1,149	)	$	(488	)	$	(1,637	)
Net unrealized (loss) gain arising during the period	(18,446		)	26,913			8,467
Reclassification of net realized loss into earnings:
Interest expense, net	—			4,663			4,663
Other comprehensive (loss) income	(18,446		)	31,576			13,130
Accumulated other comprehensive (loss) income	(19,595		)	31,088			11,493
Less: Other comprehensive loss attributable to non-controlling interests	(7,862		)	(3,545		)	(11,407		)
Balance as of December 31, 2015	$	(11,733	)	$	34,633		$	22,900

The following tables present each component of other comprehensive income (loss) and the related tax effects for the years ended December 31, 2015 and 2014:



	Year Ended December 31,
	2015									2014
(In thousands)	Before Tax			Tax Effect			Net of Tax			Before Tax			Tax Effect		Net of Tax
Foreign currency translation adjustments:
Net unrealized loss arising during the period	$	(18,446	)	$	—		$	(18,446	)	$	(3,541	)	$	—	$	(3,541	)
Hedging activities:
Net unrealized gain (loss) arising during the period	41,540			(14,627		)	26,913			(1,925		)	—		(1,925		)
Reclassification of net realized loss into earnings	4,663			—			4,663			—			—		—
Net change	46,203			(14,627		)	31,576			(1,925		)	—		(1,925		)
Other comprehensive income (loss)	$	27,757		$	(14,627	)	13,130			$	(5,466	)	$	—	(5,466		)
Less: Other comprehensive loss attributable to non-controlling interests, net of tax							(11,407		)						(3,829		)
Less: Pre-acquisition other comprehensive income of renewable energy facilities acquired from SunEdison							40,016								—
Other comprehensive loss attributable to Class A common stockholders							$	(15,479	)						$	(1,637	)

The entire disclosure for comprehensive income, which includes, but is not limited to, 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income.

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Assets Held For Sale Subsequent to the Balance Sheet Date

Assets Held For Sale Subsequent to the Balance Sheet Date

12 Months Ended

Dec. 31, 2015

Subsequent Events [Abstract]

ASSETS HELD FOR SALE SUBSEQUENT TO THE BALANCE SHEET DATE

The Company commenced a sale of substantially all of its portfolio of solar power plants located in the United Kingdom through a broad based sales process pursuant to a plan approved by management during 2016. The criteria for held for sale classification was not met for this portfolio as of December 31, 2015 but was determined to be met subsequent to the balance sheet date as of March 31, 2016. As such, the corresponding assets and liabilities are still classified as held and used on the consolidated balance sheet as of December 31, 2015. It is probable that the sale of this portfolio will occur within one year from the March 31, 2016 held for sale classification date, and the Company has currently entered negotiations with a preferred bidder. The Company's analysis as of the held for sale date indicated that the fair value less costs to sell exceeded the carrying value of the assets.

The following table summarizes the major classes of assets and liabilities as of December 31, 2015 included within the consolidated balance sheet for this portfolio that was determined to be held for sale subsequent to the balance sheet date but prior to the issuance of the financial statements for the year ended December 31, 2015:



(In thousands)	December 31, 2015
Assets
Current assets:
Cash and cash equivalents	$	25,975
Restricted cash	31,571
Accounts receivable, net	5,086
Deferred financing costs, net	1,966
Prepaid expenses and other current assets	2,051
Total current assets	66,649
Renewable energy facilities, net	637,353
Intangible assets, net	1,802
Other assets	588
Total assets	$	706,392

Liabilities
Current liabilities:
Current portion of long-term debt and financing lease obligations	$	438,537
Accounts payable, accrued expenses and other current liabilities	12,284
Due to SunEdison, net	1,201
Total current liabilities	452,022
Asset retirement obligations	45,199
Total liabilities	$	497,221

Quarterly Financial Information (Unaudited)

12 Months Ended

Dec. 31, 2015

Quarterly Financial Information Disclosure [Abstract]

Quarterly Financial Information (Unaudited)

QUARTERLY FINANCIAL INFORMATION (UNAUDITED)

Quarterly results of operations for the year ended December 31, 2015 were as follows:



(in thousands, except per share data)	Q1⁽¹⁾			Q2⁽²⁾		Q3⁽³⁾			Q4⁽⁴⁾
Operating revenues, net	$	70,515		$	130,046	$	163,291		$	105,654
Operating (loss) income	(11,963		)	39,681		64,135			(86,339		)
Interest expense, net	36,855			35,961		48,786			46,203
Net (loss) income	(83,660		)	29,134		2,418			(156,027		)
Net (loss) income attributable to Class A common stockholders	(28,116		)	6,800		(820		)	(57,750		)
Weighted average Class A common shares outstanding - basic and diluted	49,694			57,961		77,522			77,982
Net (loss) earnings per weighted average Class A common share - basic and diluted	$	(0.57	)	$	0.10	$	(0.03	)	$	(0.75	)

———


(1)	The first quarter of 2015 includes a $20.0 million loss on the extinguishment of debt due primarily to the early termination of the Term Loan and its related interest rate swap, the exchange of the previous revolver to the Revolver and prepayment of premium paid in conjunction with the payoff of First Wind indebtedness at the acquisition date.


(2)	The second quarter of 2015 includes an $11.4 million gain on the extinguishment of debt related to termination of certain financing lease obligations upon acquisition of the Duke Energy operating facility.


(3)	The third quarter of 2015 includes $9.9 million of amortization expense of bridge commitment fees related to financing our pending acquisitions of Invenergy Wind and the Vivint Operating Assets.

(4)

The fourth quarter of 2015 includes a $45.4 million loss related to the write-off of the remaining balance of a prepaid warranty from SunEdison, a $16.1 million loss on investments and related party receivables, a $10.0 million loss resulting from the LAP arbitration settlement, a $14.0 million loss related to the Eastern Maine Electric Cooperative litigation reserve and a $7.5 million loss on the extinguishment of debt as a result of the U.K. refinancing.

Quarterly results of operations for the year ended December 31, 2014 were as follows:



(in thousands, except per share data)	Q1			Q2⁽¹⁾			Q3⁽²⁾			Q4
Operating revenues, net	$	8,392		$	22,378		$	53,566		$	42,820
Operating income (loss)	2,272			8,391			20,584			(24,858		)
Interest expense, net	7,527			24,119			22,906			31,639
Net loss	(4,293		)	(12,936		)	(1,868		)	(62,826		)
Net loss attributable to Class A common stockholders	N/A			N/A			(4,014		)	(21,603		)
Weighted average Class A common shares outstanding - basic and diluted	N/A			N/A			27,066			31,505
Net loss per weighted average Class A common share - basic and diluted	N/A			N/A			$	(0.15	)	$	(0.69	)

———


(1)	The second quarter of 2014 includes a $1.9 million loss on the extinguishment of debt due to the termination of our capital lease obligations upon acquiring the lessor interest in the Alamosa project solar generation assets.


(2)	The third quarter of 2014 includes a $9.6 million net gain on the extinguishment of debt primarily due to the termination of our financing lease obligations upon acquiring the lessor interest in the SunE Solar Fund X solar generation assets and defeasance of debt obligations related to certain projects in the U.S. Projects 2009-2013 portfolio.

Nature of Operations (Policies)

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Going Concern/Basis of Presentation

Going Concern

The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The consolidated financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

Our sponsor, SunEdison, Inc., and certain of its affiliates filed for bankruptcy on April 21, 2016. We believe that we have observed formalities and operating procedures to maintain our separate existence, that our assets and liabilities can be readily identified as distinct from those of SunEdison and that we do not rely substantially on SunEdison for funding or liquidity and will have sufficient liquidity to support our ongoing operations. Our contingency planning with respect to the SunEdison Bankruptcy has and will include, among other things, establishing stand-alone information technology, accounting and other critical systems and infrastructure, establishing separate human resources systems and employee retention efforts, and retaining backup or replacement operation and maintenance and asset management services for our power plants from other providers.

However, there is a risk that an interested party in the SunEdison Bankruptcy could request that the assets and liabilities of the Company be substantively consolidated with SunEdison and that the Company and/or its assets and liabilities be included in the SunEdison Bankruptcy. While it has not been requested to date and we believe there is no basis for substantive consolidation in our circumstances, we cannot assure you that substantive consolidation will not be requested in the future or that the bankruptcy court would not consider it. Substantive consolidation is an equitable remedy in bankruptcy that results in the pooling of assets and liabilities of the debtor and one or more of its affiliates solely for purposes of the bankruptcy case, including for purposes of distributions to creditors and voting on and treatment under a reorganization plan. Bankruptcy courts have broad equitable powers, and as a result, outcomes in bankruptcy proceedings are inherently difficult to predict.

To the extent the bankruptcy court were to determine that substantive consolidation was appropriate under the Company's facts and circumstances, the assets and liabilities of the Company could be made available to help satisfy the debt or contractual obligations of SunEdison.

Additionally, there have been covenant defaults under a number of our financing arrangements, mainly because of delays in the delivery of project-level audited financial statements and the delay in the filing of the Company’s audited annual financial statements for 2015 on Form 10-K. In addition, in a number of cases the SunEdison Bankruptcy resulted in defaults because SunEdison Debtors have been serving as operation and maintenance and asset management services providers or as guarantors under relevant contracts. We have been working diligently with our lenders to cure or waive instances of default, including through the completion of project-level audits and the retention of replacement service providers. However, there can be no assurance that all remaining defaults will be cured or waived. If the remaining defaults are not cured or waived, this would restrict the ability of the relevant project-level subsidiaries to make distributions to us, which may affect our ability to meet certain covenants related to our revolving credit facility at the corporate level, or entitle the related lenders to demand repayment or enforce their security interests, which could have a material adverse effect on our business, results of operations, financial condition and ability to pay dividends.

The risk of substantive consolidation of the Company with SunEdison and inclusion in the SunEdison Bankruptcy as well as the existing covenant defaults and risks of future covenant defaults under a number of our financing agreements, raise substantial doubt about the Company’s ability to continue as a going concern.

Basis of Presentation

The Company is required to recast historical financial statements when renewable energy facilities are acquired from SunEdison. The recast reflects the assets and liabilities and the results of operations of the acquired renewable energy facilities for the period the facilities were owned by SunEdison, which is in accordance with applicable rules governing transactions between entities under common control. The Company has modified the presentation of its consolidated statement of operations to separate pre-acquisition net income (loss) of renewable energy facilities acquired from SunEdison from net loss attributable to Class A common stockholders.

For all periods prior to the Company's initial public offering ("IPO") on July 23, 2014, the accompanying consolidated financial statements represent the combination of TerraForm Power and Terra LLC, the accounting predecessor, and were prepared using SunEdison's historical basis in assets and liabilities. For all periods subsequent to the IPO, the accompanying consolidated financial statements represent the results of TerraForm Power, which consolidates Terra LLC through its controlling interest.

The historical financial statements of the Predecessor include allocations of certain SunEdison corporate expenses and income tax expense. Management believes the assumptions and methodology underlying the allocation of general corporate overhead expenses are reasonable. Subsequent to the IPO, corporate expenses represent actual costs incurred by the Company under the Management Services Agreement, as more fully described in Note 19. Related Parties.

Use of Estimates

Principles of Consolidation

Non-controlling Interests and Hypothetical Liquidation at Book Value ("HLBV")

Principles of Consolidation

Variable Interest Entities

Cash and Cash Equivalents

Cash and cash equivalents include all cash balances and money market funds with original maturity periods of three months or less when purchased.

Restricted Cash

Restricted cash consists of cash on deposit in financial institutions that is restricted to satisfy the requirements of

accounts but subject to distribution restrictions related to debt defaults existing as of the balance sheet date.

Accounts Receivable and Allowance for Doubtful Accounts

Renewable Energy Facilities

Impairment of Long-lived Assets

Intangibles

Goodwill

Capitalized Interest

Interest incurred on funds borrowed to finance construction of renewable energy facilities is capitalized until the system is ready for its intended use.

Financing Lease Obligations

Over the course of the leaseback arrangements the Company is required to make rental payments. These payments are allocated between principal and interest payments using an effective yield method.

Deferred Financing Costs

Asset Retirement Obligations

Revenue Recognition

Power Purchase Agreements

Incentive Revenue

Deferred Revenue

Income Taxes

Contingencies

Derivative Financial Instruments

The change in fair value of undesignated derivative instruments is reported as a component of net loss on the consolidated statements of operations.

Fair Value Measurements


•	Level 1: Quoted prices in active markets for identical assets or liabilities;

•


•	Level 3: Unobservable inputs that are supported by little or no market activity and that are significant to the fair values of the assets or liabilities.

Foreign Operations

Business Combinations

The allocation of the purchase price directly affects the following items in the consolidated financial statements:


•	The amount of purchase price allocated to the various tangible and intangible assets, liabilities, and non-controlling interests on the balance sheet;


•	The amounts allocated to the value of favorable and unfavorable rate PPAs and REC agreements are amortized to revenue over the remaining non-cancelable terms of the respective arrangement. The amounts allocated to all other tangible and intangible assets are amortized to depreciation or amortization expense; and

•

Basic and Diluted Loss Per Share

LOSS PER SHARE

Stock-Based Compensation

New Accounting Standards

Segment Reporting

SEGMENT REPORTING

Transactions Between Entities Under Common Control (Tables)

12 Months Ended

Dec. 31, 2015

Recast of Prior Financial Information



(In thousands) Balance Sheet Caption	As Previously Recasted		Recast Adjustments		As Recasted
Renewable energy facilities, net	$	2,637,139	$	11,073	$	2,648,212
Change in total assets			$	11,073

Current portion of long-term debt and financing lease obligations	$	97,412	$	3,076	$	100,488
Due to SunEdison, net	186,435		7,997		194,432
Change in total liabilities			$	11,073



(In thousands) Statement of Cash Flows Caption	As Previously Recasted			Recast Adjustments			Correction of Previously Recasted Amounts¹			As Recasted
Cash flows from investing activities:
Cash paid to third parties for renewable energy facility construction	$	(1,137,275	)	$	(10,135	)	$	25,117		$	(1,122,293	)
Change in net cash used in investing activities				(10,135		)	25,117

Cash flows from financing activities:
Borrowings of non-recourse long-term debt	472,444			3,076			(3,597		)	471,923
Principal payments on non-recourse long-term debt²	(338,070		)	—			(3,121		)	(341,191		)
Due to SunEdison, net	210,967			7,059			(18,657		)	199,369
Change in net cash provided by financing activities				10,135			(25,375		)

Net increase in cash and cash equivalents	467,940			—			(258		)	467,682
Effect of exchange rate changes on cash and cash equivalents	(430		)	—			258			(172		)
Cash and cash equivalents at beginning of period	1,044			—			—			1,044
Cash and cash equivalents at end of period	$	468,554		$	—		$	—		$	468,554

————

(1)

(2)



(In thousands) Statement of Cash Flows Caption	As Previously Recasted			Recast Adjustments			Correction of Previously Recasted Amounts¹			As Recasted
Cash flows from operating activities:
Changes in assets and liabilities:
Due to SunEdison, net	$	24,291		$	—		$	(5,426	)	$	18,865
Change in net cash used in operating activities				—			(5,426		)

Cash flows from investing activities:
Cash paid to third parties for renewable energy facility construction	(208,850		)	(938		)	(572		)	(210,360		)
Change in net cash used in investing activities				(938		)	(572		)

Cash flows from financing activities:
Borrowings of non-recourse long-term debt	303,442			—			1,287			304,729
Principal payments on non-recourse long-term debt	(4,641		)	—			(1,287		)	(5,928		)
Due to SunEdison, net	—			938			5,998			6,936
Change in net cash provided by financing activities				938			5,998

Net increase in cash and cash equivalents	1,041			—			—			1,041
Effect of exchange rate changes on cash and cash equivalents	—			—			—			—
Cash and cash equivalents at beginning of period	3			—			—			3
Cash and cash equivalents at end of period	$	1,044		$	—		$	—		$	1,044

————

(1)

During the fourth quarter of 2015, the Company identified a classification error in the amounts that were previously recasted in the Company's consolidated statement of cash flows for the year ended December 31, 2013 and has corrected the error as shown in the table above. This classification error did not have an impact on the Company's recasted consolidated statement of operations for the year ended December, 31, 2013, the consolidated balance sheet as of December 31, 2013 and did not impact cash and cash equivalents as of December 31, 2013 and 2012.

Transactions Under Common Control, Summary of Acquisitions

The following table summarizes the renewable energy facilities acquired by the Company from SunEdison through a series of transactions:



			Year Ended December 31, 2015				As of December 31, 2015
Facility Category	Type	Location	Nameplate Capacity (MW)	Number of Sites	Initial Cash Paid¹		Cash Due to SunEdison²		Debt Assumed³		Debt Transferred⁴
Distributed Generation	Solar	U.S.	91.5	74	$	155,573	$	2,600	$	—	$	—
Residential	Solar	U.S.	12.9	1,806	25,053		—		—		—
Utility	Solar	U.S.	54.8	9	69,868		14,341		—		14,475
Utility	Solar	U.K.	214.3	14	150,595		—		205,587		—
Utility	Wind	U.S.	200.0	1	127,000		—		—		—
Total			573.5	1,904	$	528,089	$	16,941	$	205,587	$	14,475

————


(1)	Represents the amount paid to SunEdison on the date of acquisition of renewable energy facilities from SunEdison. Excludes aggregated tax equity partner payments of $363.6 million to SunEdison.

(2)


(3)	Represents debt that was assumed by the Company as of the acquisition date of these facilities which was subsequently refinanced on November 6, 2015 (see Note 10. Long-term debt).


(4)	Represents debt recorded on the Company's balance sheet as of December 31, 2015. This debt was repaid by SunEdison during the first quarter of 2016 using cash proceeds paid by the Company and the tax equity partner to SunEdison for the acquisition of these facilities.

Transactions Under Common Control, Summary of Results of Operations

The following table is a summary of the results of operations for the renewable energy facilities acquired by the Company from SunEdison during the years ended December 31, 2015, 2014 and 2013:



	Year Ended December 31,
(In thousands)	2015			2014			2013
Operating revenues, net	$	37,629		$	1,292		$	1,247
Operating expenses	39,527			1,017			1,015
Operating (loss) income	(1,898		)	275			232
Interest expense, net	5,575			1,773			1,862
Other non-operating income, net	(3,582		)	—			—
Net loss	$	(3,891	)	$	(1,498	)	$	(1,630	)

Acquisitions (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Allocation of Assets and Liabilities of Purchased Renewable Generation Facilities

The estimated acquisition-date fair values of assets, liabilities and non-controlling interests pertaining to business combinations as of December 31, 2015, are as follows:



	2015 Preliminary		2015 Final										2014 Final
(In thousands)	Invenergy Wind		First Wind		Other First Wind¹		Northern Lights		Integrys		Other		Mt. Signal		Capital Dynamics		Other
Renewable energy facilities in service	$	1,486,746	$	795,462	$	—	$	62,018	$	69,935	$	7,931	$	649,570	$	190,352	$	256,912
Construction in progress - renewable energy facilities	—		—		264,858		—		—		28,878		—		—		—
Accounts receivable	25,811		30,031		—		1,361		2,610		—		11,687		8,331		9,906
Intangible assets	748,300		123,600		—		39,000		28,966		12,454		119,767		74,236		120,624
Goodwill	—		—		—		—		—		—		—		55,874		—
Deferred income taxes	—		—		—		—		—		—		—		—		—
Restricted cash	31,247		7,240		60		—		827		—		22,165		15		14,720
Derivative assets	32,311		44,755		—		—		—		—		—		—		—
Other assets	12,070		5,873		—		11		234		200		12,621		348		9,552
Total assets acquired	2,336,485		1,006,961		264,918		102,390		102,572		49,463		815,810		329,156		411,714
Accounts payable, accrued expenses and other current liabilities	23,195		9,854		442		440		409		1,854		22,725		1,478		3,016
Long-term debt, including current portion	531,221		47,400		72,881		—		15,882		—		413,464		—		136,156
Deferred income taxes	242		—		—		—		—		—		—		25,129		927
Asset retirement obligations	47,346		19,890		—		818		5,730		509		4,656		13,073		17,374
Other long-term liabilities	6,004		18,562		23,237		—		5,786		—		—		12,100		5,242
Total liabilities assumed	608,008		95,706		96,560		1,258		27,807		2,363		440,845		51,780		162,715
Redeemable non-controlling interest	141,415		3,076		—		—		—		8,298		—		20,194		2,250
Non-controlling interest	308,000		96,624		—		—		4,045		—		83,310		—		2,000
Purchase price, net of cash acquired	$	1,279,062	$	811,555	$	168,358	$	101,132	$	70,720	$	38,802	$	291,655	$	257,182	$	244,749

————


(1)	Represents renewable energy facilities with a combined nameplate capacity of 222.6 MW acquired from SunEdison during the year ended December 31, 2015. These facilities were acquired by SunEdison from First Wind on January 29, 2015.

The estimated acquisition-date fair values of assets, liabilities and non-controlling interests pertaining to business combinations as of December 31, 2014, were as follows:



	Capital				Other
(In thousands)	Dynamics		Mt. Signal		Acquisitions
Renewable energy facilities in service	$	200,712	$	649,005	$	245,828
Accounts receivable	4,511		11,617		11,251
Intangible assets	83,114		117,925		140,248
Deferred income taxes	22,129		—		—
Restricted cash	15		22,165		14,688
Other assets	687		12,621		4,987
Total assets acquired	311,168		813,333		417,002
Accounts payable, accrued expenses and other current liabilities	5,925		24,813		7,410
Long-term debt, including current portion	—		413,464		137,472
Deferred income taxes	25,191		—		892
Asset retirement obligations	6,749		4,656		18,058
Total liabilities assumed	37,865		442,933		163,832
Redeemable non-controlling interest	16,600		—		7,738
Non-controlling interest	—		78,745		2,175
Purchase price, net of cash acquired	$	256,703	$	291,655	$	243,257

Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination



	Fair Value
(In thousands)	Mt. Signal	Capital Dynamics	Other
Intangible assets
Favorable rate revenue contracts	—	26,000	70,179
In-place value of market rate revenue contracts	119,767	48,236	50,445
Intangible liabilities
Unfavorable rate revenue contracts	—	12,100	—

	Weighted Average Amortization Period¹
(In years)	Mt. Signal	Capital Dynamics	Other
Intangible assets
Favorable rate revenue contracts	—	18	19
In-place value of market rate revenue contracts	25	23	15
Intangible liabilities
Unfavorable rate revenue contracts	—	7	—

————

The following table summarizes the fair value and weighted average amortization period of acquired intangible assets and liabilities as of the acquisition date for transactions closed during 2015.



	Fair Value
(In thousands)	Invenergy Wind	First Wind	Northern Lights	Integrys	Other
Intangible assets
Favorable rate revenue contracts	550,000	3,900	39,000	21,168	12,454
In-place value of market rate revenue contracts	198,300	103,900	—	7,798	—
Favorable rate land leases	—	15,800	—	—	—
Intangible liabilities
Unfavorable rate revenue contracts	—	17,200	—	5,786	—
Unfavorable rate land lease	—	1,000	—	—	—

	Weighted Average Amortization Period¹
(In years)	Invenergy Wind	First Wind	Northern Lights	Integrys	Other
Intangible assets
Favorable rate revenue contracts	17	3	18	12	20
In-place value of market rate revenue contracts	21	18	—	22	—
Favorable rate land leases	—	20	—	—	—
Intangible liabilities
Unfavorable rate revenue contracts	—	6	—	19	—
Unfavorable rate land lease	—	18	—	—	—

————

Business Acquisition, Pro Forma Information



	Year Ended December 31,
(In thousands, unaudited)	2015			2014
Total operating revenues, net	$	605,724		$	427,794
Net loss	(113,823		)	(102,938		)

Renewable Energy Facilities (Tables)

12 Months Ended

Dec. 31, 2015

Property, Plant and Equipment [Abstract]

Renewable Energy Facilities

Renewable energy facilities, net consists of the following:



(In thousands)	December 31, 2015			December 31, 2014
Renewable energy facilities in service, at cost	$	5,906,154		$	2,241,728
Less accumulated depreciation - renewable energy facilities	(187,874		)	(52,981		)
Renewable energy facilities in service, net	5,718,280			2,188,747
Construction in progress - renewable energy facilities	84,100			459,465
Total renewable energy facilities, net	$	5,802,380		$	2,648,212

Asset Retirement Obligations (Tables)

12 Months Ended

Dec. 31, 2015

Asset Retirement Obligation Disclosure [Abstract]

Schedule of Change in Asset Retirement Obligation

Activity in asset retirement obligations for the years ended December 31, 2015 and 2014 is as follows:



	Year Ended December 31,
(In thousands)	2015			2014
Balance as of the beginning of the year	$	78,175		$	13,005
Additional obligations from renewable energy facilities achieving commercial operation	52,181			34,414
Assumed through acquisition	74,293			29,450
Acquisition accounting adjustments related to prior year acquisitions	5,640			—
Accretion expense	7,209			2,109
Currency translation adjustment	(2,352		)	(803		)
Balance as of the end of the year	$	215,146		$	78,175

Goodwill (Tables)

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

The changes in the carrying amount of goodwill for the year ended December 31, 2015, is presented in the table below:



(In thousands)	Distributed Generation reporting unit
Balance as of December 31, 2014	$	—
Goodwill acquired	55,874
Balance as of December 31, 2015	$	55,874

Intangibles (Tables)

12 Months Ended

Dec. 31, 2015

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Gross Carrying Amount and Accumulated Amortization of Other Intangible Asses

The following table presents the gross carrying amount and accumulated amortization of intangibles as of December 31, 2015:



(In thousands, except weighted-average amortization period)	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Favorable rate revenue contracts	17 years	$	714,137	$	(12,024	)	$	702,113
In-place value of market rate revenue contracts	20 years	551,226		(22,229		)	528,997
Favorable rate land leases	19 years	15,800		(746		)	15,054
Total intangible assets, net		$	1,281,163	$	(34,999	)	$	1,246,164

Unfavorable rate revenue contracts	8 years	$	35,086	$	(4,951	)	$	30,135
Unfavorable rate land lease	17 years	1,000		(51		)	949
Total intangible liabilities, net		$	36,086	$	(5,002	)	$	31,084

The following table presents the gross carrying amount and accumulated amortization of intangibles as of December 31, 2014:



(In thousands, except weighted-average amortization period)	Weighted Average Amortization Period	Gross Carrying Amount		Accumulated Amortization			Net Book Value
Favorable rate revenue contracts	17 years	$	221,555	$	(4,161	)	$	217,394
In-place value of market rate revenue contracts	24 years	146,258		(1,979		)	144,279
Total intangible assets, net		$	367,813	$	(6,140	)	$	361,673

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Over the next five fiscal years, the Company expects to recognize annual amortization expense on its intangibles as follows:



(In thousands)	2016			2017			2018			2019			2020
Favorable rate revenue contracts	$	44,429		$	44,362		$	43,415		$	43,329		$	43,263
Unfavorable rate revenue contracts	(5,496		)	(5,490		)	(4,956		)	(4,845		)	(2,620		)
Total net amortization expense recorded to operating revenues, net	$	38,933		$	38,872		$	38,459		$	38,484		$	40,643

In-place value of market rate revenue contracts	$	27,740		$	27,740		$	27,740		$	27,740		$	27,740
Total amortization expense recorded to depreciation, accretion and amortization expense	$	27,740		$	27,740		$	27,740		$	27,740		$	27,740

Favorable rate land leases	$	799		$	799		$	799		$	799		$	799
Unfavorable rate land lease	(56		)	(56		)	(56		)	(56		)	(56		)
Total net amortization expense recorded to cost of operations	$	743		$	743		$	743		$	743		$	743

Variable Interest Entities (Tables)

12 Months Ended

Dec. 31, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Variable Interest Entities

The carrying amounts and classification of the consolidated VIEs’ assets and liabilities included in the Company's consolidated balance sheets are as follows:



(In thousands)	December 31, 2015		December 31, 2014
Current assets	$	89,185	$	69,955
Non-current assets	1,969,853		1,756,276
Total assets	$	2,059,038	$	1,826,231
Current liabilities	$	614,195	$	64,324
Non-current liabilities	142,443		707,989
Total liabilities	$	756,638	$	772,313

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

Schedule of Future Minimum Lease Payments for Capital Leases

Long-term Debt (Tables)

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Schedule of Debt

Long-term debt consists of the following:



(In thousands, except rates) Description:	December 31, 2015			December 31, 2014			Interest Type	Current Interest Rate (%)	Financing Type
Corporate-level long-term debt¹:
Term Loan	$	—		$	573,500		Variable	5.33²	Term debt
Senior Notes due 2023	950,000			—			Fixed	5.88	Senior notes
Senior Notes due 2025	300,000			—			Fixed	6.13	Senior notes
Revolver	655,000			—			Variable	2.79	Revolving loan
Non-recourse long-term debt³:
Permanent financing	2,546,864			824,167			Blended⁴	5.77⁵	Term debt / Senior notes
Construction financing	14,475			174,458			Variable	6.00	Construction debt
Financing lease obligations	136,594			126,167			Imputed	5.69⁵	Financing lease obligations
Total principal due for long-term debt and financing lease obligations	4,602,933			1,698,292				5.40⁵
Net unamortized (discount) premium	(20,821		)	1,473
Less current portion of long-term debt and financing lease obligations	(2,031,937		)	(100,488		)
Long-term debt and financing lease obligations, less current portion	$	2,550,175		$	1,599,277

———


(1)	Corporate-level debt represents debt issued by Terra Operating LLC and guaranteed by Terra LLC and certain subsidiaries of Terra Operating LLC other than non-recourse subsidiaries as defined in the relevant debt agreements.


(2)	The Company entered into an interest rate swap agreement fixing the interest rate at 5.33%. The swap agreement was terminated upon repayment of the Term Loan.


(3)	Non-recourse debt represents debt issued by subsidiaries with no recourse to Terra LLC, Terra Operating LLC, or guarantors of the Company's corporate-level debt, other than limited or capped contingent support obligations, which in aggregate are not considered to be material to the Company's business and financial condition.


(4)	Includes variable rate debt and fixed rate debt. As of December 31, 2015, 67% of this balance had a variable interest rate and the remaining 33% of this balance had a fixed interest rate. The Company has entered into interest rate swap agreements to fix the interest rates of certain variable rate permanent financing non-recourse debt (see Note 12. Derivatives).


(5)	Represents the weighted average interest rate as of December 31, 2015.

The aggregate amounts of minimum lease payments on the Company's financing lease obligations are $136.6 million. Contractual obligations for 2016 through 2020 and thereafter, are as follows:



(In thousands)	2016		2017		2018		2019		2020		Thereafter		Total
Minimum lease obligations¹	$	9,968	$	9,119	$	9,252	$	18,968	$	9,320	$	79,967	$	136,594

———


(1)	Represents the minimum lease payment due dates for our financing lease obligations and does not reflect the reclassification of $99.1 million of financing lease obligations to current as a result of debt defaults under most of our non-recourse financing arrangements.

Schedule of Maturities of Long-term Debt



(In thousands)	2016¹		2017		2018		2019		2020		Thereafter		Total
Maturities of long-term debt as of December 31, 2015²	$	123,927	$	98,269	$	120,882	$	562,432	$	727,720	$	2,833,109	$	4,466,339

———


(1)	Includes $14.5 million of construction debt for the utility-scale renewable energy facilities located in the U.S. acquired in 2015 from SunEdison which was repaid by SunEdison during the first quarter of 2016 (see Note 3. Transactions Between Entities Under Common Control). Also includes $30.0 million of Revolver indebtedness that was paid during the fourth quarter of 2016 as discussed above.


(2)	Represents the contractual principal payment due dates for our long-term debt and does not reflect the reclassification of $1.8 billion of long-term debt to current as a result of debt defaults under most of our non-recourse financing arrangements.

Income Taxes (Tables)

12 Months Ended

Dec. 31, 2015

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

The income tax provision consisted of the following:



(In thousands)	Current		Deferred			Total
Year ended December 31, 2015
U.S. federal	$	98	$	(12,507	)	$	(12,409	)
State and local	—		(1,182		)	(1,182		)
Foreign	158		192			350
Total expense (benefit)	$	256	$	(13,497	)	$	(13,241	)
Tax expense in equity	—		14,627			14,627
Total	$	256	$	1,130		$	1,386

Year ended December 31, 2014
U.S. federal	$	84	$	(3,554	)	$	(3,470	)
State and local	—		(213		)	(213		)
Foreign	—		(1,006		)	(1,006		)
Total expense (benefit)	$	84	$	(4,773	)	$	(4,689	)
Tax benefit in equity	—		(3,616		)	(3,616		)
Total	$	84	$	(8,389	)	$	(8,305	)

Year ended December 31, 2013
U.S. federal	$	—	$	(329	)	$	(329	)
State and local	—		42			42
Foreign	165		34			199
Total expense (benefit)	$	165	$	(253	)	$	(88	)

Schedule of Effective Income Tax Rate Reconciliation

Effective Tax Rate

Income tax provision differed from the amounts computed by applying the statutory U.S. federal income tax rate of 35% to loss before income taxes.



	Year Ended December 31,
	2015		2014		2013
Income tax benefit at U.S. federal statutory rate	35.0	%	35.0	%	35.0	%
Increase (reduction) in income taxes:
State income taxes, net of U.S. federal benefit	1.0	%	1.0	%	(2.1	)%
Foreign operations	9.9	%	1.4	%	—	%
Non-controlling interest	(20.6	)%	(15.8	)%	—	%
Stock-based compensation	(2.2	)%	(2.2	)%	—	%
Change in valuation allowance	(17.7	)%	(8.8	)%	—	%
Other	0.6	%	(5.2	)%	(28.5	)%
Effective tax benefit rate	6.0	%	5.4	%	4.4	%

Schedule of Deferred Tax Assets and Liabilities

The tax effects of the major items recorded as deferred tax assets and liabilities are:



	As of December 31,
(In thousands)	2015			2014
Deferred tax assets:
Net operating losses and tax credit carryforwards	$	217,834		$	53,968
Investment in partnership	123,253			141,148
Deferred revenue	743			207
Renewable energy facilities	11,667			2,078
Total deferred tax assets	353,497			197,401
Valuation allowance	(333,858		)	(167,508		)
Net deferred tax assets	19,639			29,893
Deferred tax liabilities:
Investment in partnership	45,269			25,287
Renewable energy facilities	—			7,473
Other	1,000			229
Total deferred tax liabilities	46,269			32,989
Net deferred tax liabilities	$	26,630		$	3,096

Derivatives (Tables)

12 Months Ended

Dec. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

As of December 31, 2015 and 2014, fair values of the following derivative instruments were included in the balance sheet captions indicated below:



	Fair Value of Derivative Instruments
	Hedging Contracts				Derivatives Not Designated as Hedges
(In thousands)	Interest Rate Swaps		Commodity Contracts		Interest Rate Swaps		Foreign Currency Contracts		Commodity Contracts		Gross Amounts of Assets/Liabilities Recognized		Gross Amounts Offset in Consolidated Balance Sheets			Net Amounts in Consolidated Balance Sheets
As of December 31, 2015
Prepaid expenses and other current assets	$	—	$	11,455	$	—	$	3,875	$	12,542	$	27,872	$	(1,451	)	$	26,421
Other assets	487		51,699		—		2,836		30,799		85,821		(70		)	85,751
Total assets	$	487	$	63,154	$	—	$	6,711	$	43,341	$	113,693	$	(1,521	)	$	112,172
Accounts payable and other current liabilities	$	19,081	$	—	$	1,104	$	3,777	$	—	$	23,962	$	(1,451	)	$	22,511
Other long-term liabilities	—		—		—		70		—		70		(70		)	—
Total liabilities	$	19,081	$	—	$	1,104	$	3,847	$	—	$	24,032	$	(1,521	)	$	22,511

As of December 31, 2014
Other assets	$	—	$	—	$	—	$	1,811	$	—	$	1,811	$	—		$	1,811
Total assets	$	—	$	—	$	—	$	1,811	$	—	$	1,811	$	—		$	1,811
Accounts payable and other current liabilities	$	1,925	$	—	$	1,279	$	685	$	—	$	3,889	$	—		$	3,889
Total liabilities	$	1,925	$	—	$	1,279	$	685	$	—	$	3,889	$	—		$	3,889

Schedule of Notional Amounts of Outstanding Derivative Positions

As of December 31, 2015 and 2014, notional amounts for derivative instruments consisted of the following:



(In thousands)	December 31, 2015	December 31, 2014
Derivatives designated as hedges:
Interest rate swaps (USD)	468,067	349,213
Interest rate swaps (GBP)	222,018	—
Commodity contracts (MWhs)	18,401	—
Derivatives not designated as hedges:
Interest rate swaps (USD)	15,794	16,861
Foreign currency contracts (GBP)	112,168	58,710
Foreign currency contracts (CAD)	40,566	25,415
Commodity contracts (MWhs)	1,828	—

Gain (loss) of Derivative Instruments

Gains and losses on derivatives not designated as hedges for the years ended December 31, 2015, 2014 and 2013 consisted of the following:



	Location of Loss (Gain) in the Statements of Operations	Year Ended December 31,
(In thousands)	Location of Loss (Gain) in the Statements of Operations	2015			2014			2013
Interest rate swaps	Interest expense, net	$	345		$	1,279		$	—
Foreign currency contracts	Loss (gain) on foreign currency exchange, net	(3,600		)	(1,126		)	—
Commodity contracts	Operating revenues, net	(10,178		)	—			—

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

Gains (losses) recognized related to interest rate swaps and commodity contracts designated as cash flow hedges for the years ended December 31, 2015, 2014 and 2013 consisted of the following:



	Year Ended December 31,
	Gain (Loss) Recognized in Other Comprehensive Income (Effective Portion) net of taxes¹								Location of Loss Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion)	Amount of Loss Reclassified from Accumulated Other Comprehensive Income into Income (Effective Portion)						Amount of Loss Recognized in Income (Ineffective Portion and Amount Excluded from Effectiveness Testing)
(In thousands)	2015			2014			2013			2015		2014		2013		2015		2014		2013
Interest rate swaps	$	(11,482	)	$	(1,925	)	$	—	Interest expense, net	$	4,663	$	—	$	—	$	—	$	—	$	—
Commodity contracts	38,395			—			—		Operating revenues, net	—		—		—		—		—		—
Total	$	26,913		$	(1,925	)	$	—		$	4,663	$	—	$	—	$	—	$	—	$	—

————


(1)	Net of taxes of $14.6 million related to commodity contracts during the year ended December 31, 2015. There were no taxes related to interest rate swaps during the year ended December 31, 2015. There were no taxes related to derivatives designated as hedges during the years ended December 31, 2014 and 2013.

Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2015

Fair Value Disclosures [Abstract]

Fair Value, Assets and Liabilities Measured on Recurring Basis



(In thousands)	As of December 31, 2015								As of December 31, 2014
Assets	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Interest rate swaps	$	—	$	487	$	—	$	487	$	—	$	—	$	—	$	—
Commodity contracts	—		43,341		63,154		106,495		—		—		—		—
Foreign currency contracts	—		5,190		—		5,190		—		1,811		—		1,811
Total derivative assets	$	—	$	49,018	$	63,154	$	112,172	$	—	$	1,811	$	—	$	1,811
Liabilities
Interest rate swaps	$	—	$	20,185	$	—	$	20,185	$	—	$	3,204	$	—	$	3,204
Foreign currency contracts	—		2,326		—		2,326		—		685		—		685
Total derivative liabilities	$	—	$	22,511	$	—	$	22,511	$	—	$	3,889	$	—	$	3,889

Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation

The following table reconciles the changes in the fair value of derivative instruments classified as Level 3 in the fair value hierarchy for the year ended December 31, 2015:



(In thousands)	Year Ended December 31, 2015
Balance as of January 1, 2015	$	—
Realized and unrealized gains (losses):
Included in Other Comprehensive Income	53,022
Included in earnings	—
Purchases (acquisition of commodity contracts)	10,132
Settlements	—
Balance as of December 31, 2015	$	63,154

The significant unobservable inputs used in the valuation of the Company's commodity contracts categorized as Level 3 of the fair value hierarchy as of December 31, 2015 are as follows:



(In thousands, except range)	Fair Value as of December 31, 2015
Transaction Type	Assets		Liabilities		Valuation Technique	Unobservable Inputs	Range
Commodity contracts - power	$	63,154	$	—	Discounted cash flow	Forward price (per MWh)	$	18.1		-	$	153.9
					Option model	Volatilities	3.0		%	-	3.0		%

Fair Value Inputs, Liabilities, Quantitative Information

The sensitivity of the Company's fair value measurements to increases (decreases) in the significant unobservable inputs is as follows:



Significant Unobservable Input	Position	Impact on Fair Value Measurement
Increase (decrease) in forward price	Forward sale	Decrease (increase)
Increase (decrease) in implied volatilities	Purchase option	Increase (decrease)

Fair Value Inputs, Assets, Quantitative Information

The sensitivity of the Company's fair value measurements to increases (decreases) in the significant unobservable inputs is as follows:



Significant Unobservable Input	Position	Impact on Fair Value Measurement
Increase (decrease) in forward price	Forward sale	Decrease (increase)
Increase (decrease) in implied volatilities	Purchase option	Increase (decrease)

Carrying Amount and Estimated Fair Value of Terra LLC Long-term Debt

The carrying amount and estimated fair value of the Company's long-term debt as of December 31, 2015 and December 31, 2014 is as follows:



	As of December 31, 2015				As of December 31, 2014
(In thousands)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt, including current portion	$	4,582,112	$	4,333,734	$	1,699,765	$	1,707,781

Stockholder's Equity (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Stockholders Equity

As of December 31, 2015, the following shares of TerraForm Power were outstanding:



Shares:	Number Outstanding	Shareholder(s)
Class A common stock	79,612,533	*
Class B common stock	60,364,154	SunEdison
Total Shares	139,976,687

———

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21506-112644

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 480
-SubTopic 10
-Section S99
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=27011957&loc=d3e177068-122764

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-URI http://asc.fasb.org/extlink&oid=27012166&loc=d3e187085-122770

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 10
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21553-112644

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(d),(e))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=6403732&loc=d3e21300-112643

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21521-112644

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.28,29)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21484-112644

Reference 11: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21538-112644

Reference 12: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21488-112644

Reference 13: http://www.xbrl.org/2003/role/presentationRef
-Publisher SEC
-Name Regulation S-X (SX)
-Number 210
-Section 02
-Paragraph 30
-Article 5

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based Compensation (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Share-based Compensation, Restricted Stock Units Award Activity

The following table presents information regarding outstanding RSAs as of December 31, 2015 and changes during the year then ended:



	Number of RSAs Outstanding		Weighted-Average Grant-Date Fair Value Per Share		Aggregate Intrinsic Value (in millions)
Balance as of January 1, 2015	4,876,567		$	1.12
Converted	(2,458,190	)	0.79
Forfeited	(625,055	)	0.68
Modified	66,294		35.05
Balance as of December 31, 2015	1,859,616		$	2.93	$	23.4

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity

The following table presents information regarding outstanding RSUs as of December 31, 2015 and changes during the year then ended:



	Number of RSUs Outstanding		Aggregate Intrinsic Value (in millions)		Weighted Average Remaining Contractual Life (In Years)
Balance as of January 1, 2015	825,943
Granted	2,851,857
Converted	(228,792	)
Forfeited	(240,614	)
Balance as of December 31, 2015	3,208,394		$	40.4	1.4

Schedule of Share-based Compensation, Stock Options, Activity

The following table presents information regarding outstanding stock options as of December 31, 2015 and changes during the year then ended:



	Number of Stock Options Outstanding		Weighted Average Exercise Price Per Share		Aggregate Intrinsic Value (in millions)		Weighted Average Remaining Contractual Life (In Years)
Balance as of January 1, 2015	150,000		$	29.31
Forfeited	(93,750	)	29.31
Balance as of December 31, 2015	56,250		$	29.31	$	—	0.1
Options exercisable as of December 31, 2015	56,250		$	29.31	$	—	0.1

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions



	For the year ended December 31, 2014
Risk-free interest rate	1.4	%
Expected volatility	63.0	%
Expected term (in years)	4
Expected dividend yield	3.7	%

Loss Per Share (Tables)

12 Months Ended

Dec. 31, 2015

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

Basic and diluted loss per share for the years ended December 31, 2015 and 2014 was calculated as follows:



	Year Ended December 31,
(In thousands, except per share amounts)	2015			2014
Basic and diluted loss per share¹:
Net loss attributable to Class A common stockholders	$	(79,886	)	$	(25,617	)
Less: dividends paid on Class A shares and participating RSAs	(74,377		)	—
Undistributed loss attributable to Class A shares	$	(154,263	)	$	(25,617	)

Weighted average basic and diluted Class A shares outstanding	65,883			29,602

Distributed earnings per share	$	1.09		$	—
Undistributed loss per share	(2.34		)	(0.87		)
Basic and diluted loss per share	$	(1.25	)	$	(0.87	)

———

(1)

Non-controlling Interests (Tables)

12 Months Ended

Dec. 31, 2015

Noncontrolling Interest [Abstract]

Schedule of Noncontrolling Interest

The following table presents the non-controlling interest balances by entity, reported in stockholders’ equity in the consolidated balance sheets as of December 31, 2015 and 2014:



(In thousands)	December 31, 2015		December 31, 2014
Non-controlling interests in Terra LLC:
SunEdison	$	897,409	$	722,342
Riverstone	—		65,376
Total non-controlling interests in Terra LLC¹	897,409		787,718
Total non-controlling interests in renewable energy facilities	858,117		256,811
Total non-controlling interests	$	1,755,526	$	1,044,529

———


(1)	Reflects an equity reallocation of $170.3 million and $139.1 million as of December 31, 2015 and 2014, respectively, due to an adjustment of capital balances to reflect respective ownership percentages as of each balance sheet date.

Redeemable Noncontrolling Interest

The following table presents the activity of the redeemable non-controlling interest balance reported on the consolidated balance sheets as of December 31, 2015 and 2014:



	Redeemable Non-controlling Interests
(In thousands)	Capital			Accumulated Deficit		Total
Balance as of December 31, 2013	$	—		$	—	$	—
Consolidation of redeemable non-controlling interests in acquired renewable energy facilities	24,338			—		24,338
Balance as of December 31, 2014	$	24,338		$	—	$	24,338
Consolidation of redeemable non-controlling interests in acquired renewable energy facilities	151,408			—		151,408
Sale of membership interests in renewable energy facilities	3,032			—		3,032
Repurchase of non-controlling interest	(8,504		)	—		(8,504		)
Distributions	(2,764		)	—		(2,764		)
Currency translation adjustment	(311		)	—		(311		)
Net income	—			8,512		8,512
Balance as of December 31, 2015	$	167,199		$	8,512	$	175,711

Commitments and Contingencies (Tables)

12 Months Ended

Dec. 31, 2015

Commitments and Contingencies Disclosure [Abstract]

Contractual Obligation, Fiscal Year Maturity Schedule



(in thousands)	Rent
2016	$	17,695
2017	18,101
2018	18,398
2019	18,692
2020	18,995
Thereafter	278,999
Total	$	370,880

Related Parties (Tables)

12 Months Ended

Dec. 31, 2015

Schedule of Related Party Transactions

The following table illustrates the detail of Net SunEdison investment for the year ended December 31, 2015 and December 31, 2014 as reported on the consolidated statements of stockholders' equity:



	Year ended December 31,
(in thousands)	2015			2014
MSA - General and administrative expenses - affiliate¹	$	51,330		$	19,144
MSA - Failed deal costs²	6,069			—
Interest Payment Agreement and Amended Interest Payment Agreement³	18,597			5,400
First Wind capital expenditures and O&M labor fees⁴	4,303			—
TerraForm Power, Inc. equity awards distributed to SunEdison⁵	(10,509		)	—
Deemed contribution related to acquisitions from SunEdison⁶	41,773			1,498
Lindsay debt repayment⁷	40,306			—
Contribution in exchange for Class B common stock and Class B units at IPO⁸	—			398,902
Other	1,532			—
Net SunEdison investment	$	153,401		$	424,944

———


(1)	Represents total general and administrative expenses - affiliate in excess of cash paid to SunEdison pursuant to the MSA agreement ($4.0 million paid during fiscal 2015 and no cash payments during fiscal 2014).


(2)	Represents acquisition costs related to failed deals that were paid by SunEdison. Such costs are reimbursable by SunEdison under the MSA.


(3)	Represents contributions received pursuant to the Interest Payment Agreement and the Amended Interest Payment Agreement. $8.0 million of the amount for the year ended December 31, 2015 was not received in cash from SunEdison until February 3, 2016 and a receivable from SunEdison was recorded within Due to SunEdison, net as of December 31, 2015.


(4)	Represents contributions received for capital expenditures and operations and maintenance labor fees in excess of budgeted amounts for certain of the Company's wind power plants, which SunEdison committed to reimburse the Company for in conjunction with the First Wind Acquisition.


(5)	Represents stock-based compensation cost related to equity awards in the Company's stock which has been allocated to SunEdison.


(6)	Represents the difference between the cash purchase price and historical cost of the net assets acquired from SunEdison.


(7)	SunEdison repaid the remaining outstanding principal balance and interest due on the SunE Perpetual Lindsay construction term loan on the Company's behalf as required pursuant to the terms of a project investment agreement entered into prior to the IPO of the Company.


(8)	Represents SunEdison's net contribution at IPO in exchange for Class B common stock of the Company and Class B units of Terra LLC.

Segment Reporting (Tables)

12 Months Ended

Dec. 31, 2015

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

The following table reflects summarized financial information concerning the Company’s reportable segments for the years ended December 31, 2015, 2014 and 2013:



	Year Ended December 31, 2015
(In thousands)	Solar		Wind			Corporate			Total
Operating revenues, net	$	346,033	$	123,473		$	—		$	469,506
Depreciation, accretion and amortization expense	117,727		43,392			191			161,310
Other operating costs and expenses	65,515		89,831			147,336			302,682
Interest expense, net	71,351		6,991			89,463			167,805
Other non-operating expenses, net	13,986		6,682			38,417			59,085
Income tax benefit¹	—		—			(13,241		)	(13,241		)
Net income (loss)	$	77,454	$	(23,423	)	$	(262,166	)	$	(208,135	)
Cash Flows
Capital expenditures	$	432,807	$	181,594		$	3,248		$	617,649
Balance Sheet
Total assets²	3,907,135		3,769,530			551,558			8,228,223



	Year Ended December 31, 2014
(In thousands)	Solar			Wind		Corporate			Total
Operating revenues, net	$	127,156		$	—	$	—		$	127,156
Depreciation, accretion and amortization expense	41,280			—		—			41,280
Other operating costs and expenses	33,322			—		46,165			79,487
Interest expense, net	56,019			—		30,172			86,191
Other non-operating (income) expenses, net	(6,209		)	—		13,019			6,810
Income tax benefit¹	—			—		(4,689		)	(4,689		)
Net income (loss)	$	2,744		$	—	$	(84,667	)	$	(81,923	)
Cash Flows
Capital expenditures	$	1,122,293		$	—	$	—		$	1,122,293
Balance Sheet
Total assets²	3,166,253			—		514,170			3,680,423



	Year Ended December 31, 2013
(In thousands)	Solar			Wind		Corporate			Total
Operating revenues, net	$	18,716		$	—	$	—		$	18,716
Depreciation, accretion and amortization expense	5,731			—		—			5,731
Other operating costs and expenses	7,627			—		—			7,627
Interest expense, net	8,129			—		—			8,129
Other non-operating income, net	(771		)	—		—			(771		)
Income tax benefit¹	—			—		(88		)	(88		)
Net (loss) income	$	(2,000	)	$	—	$	88		$	(1,912	)
Cash Flows
Capital expenditures	$	210,360		$	—	$	—		$	210,360

———


(1)	Income tax benefit is not allocated to the Company's Solar and Wind segments.


(2)	As of December 31, 2015 and 2014, respectively.

Schedule of Revenue by Major Customers by Reporting Segments

The following table reflects operating revenues, net for the years ended December 31, 2015, 2014 and 2013 by specific customers exceeding 10% of total operating revenue:

Year Ended December 31,

2015

2014

2013

(In thousands, except for percentages)

Segment

Amount

Percentage

Amount

Percentage

Amount

Percentage

San Diego Gas & Electric

Solar

67,562

14.4

39,574

31.1

N/A

Compañía Minera del Pacífico S.A.

Solar

N/A

23,130

18.2

N/A

Customer A

Solar

N/A

4,196

22.4

Customer B

Solar

N/A

1,761

9.4

Customer C

Solar

N/A

1,726

9.2

———

N/A - These customers did not exceed 10% of total operating revenue for the period indicated above.

Reconciliation of Revenue from Segments to Consolidated

The following table reflects operating revenues, net for the years ended December 31, 2015, 2014 and 2013 by geographic location:



	Year Ended December 31,
(In thousands)	2015		2014		2013
United States (including Puerto Rico)	$	368,117	$	87,502	$	18,716
Chile	27,148		23,130		—
United Kingdom	55,542		15,890		—
Canada	18,699		634		—
Total operating revenues, net	$	469,506	$	127,156	$	18,716

Reconciliation of Assets from Segment to Consolidated

The following table is a summary of long-lived assets, net by geographic area:



(In thousands)	December 31, 2015		December 31, 2014
United States (including Puerto Rico)	$	5,844,992	$	2,147,877
Chile	181,756		189,221
United Kingdom	659,176		545,848
Canada	418,494		126,939
Total long-lived assets, net	7,104,418		3,009,885
Current assets	954,367		593,772
Other non-current assets	169,438		76,766
Total assets	$	8,228,223	$	3,680,423

Other Comprehensive (Loss) Income (Tables)

12 Months Ended

Dec. 31, 2015