ESS TECH, INC., 10-K filed on 3/14/2024
Annual Report
v3.24.0.1
Cover - USD ($)
$ in Millions
 12 Months Ended
Dec. 31, 2023
Mar. 08, 2024
Jun. 30, 2023
Entity Information [Line Items]      
Document Type 10-K    
Document Annual Report true    
Document Period End Date Dec. 31, 2023    
Current Fiscal Year End Date --12-31    
Document Transition Report false    
Entity File Number 001-39525    
Entity Registrant Name ESS Tech, Inc.    
Entity Incorporation, State or Country Code DE    
Entity Tax Identification Number 98-1550150    
Entity Address, Address Line One 26440 SW Parkway Ave.    
Entity Address, Address Line Two Bldg. 83    
Entity Address, City or Town Wilsonville    
Entity Address, State or Province OR    
Entity Address, Postal Zip Code 97070    
City Area Code 855    
Local Phone Number 423-9920    
Entity Well-known Seasoned Issuer No    
Entity Voluntary Filers No    
Entity Current Reporting Status Yes    
Entity Interactive Data Current Yes    
Entity Filer Category Non-accelerated Filer    
Entity Small Business true    
Entity Emerging Growth Company true    
Entity Ex Transition Period false    
ICFR Auditor Attestation Flag false    
Document Financial Statement Error Correction [Flag] true    
Document Financial Statement Restatement Recovery Analysis [Flag] false    
Entity Shell Company false    
Entity Public Float     $ 111.9
Entity Common Stock, Shares Outstanding   174,898,086  
Documents Incorporated by Reference
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the registrant’s definitive proxy statement relating to the 2024 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended December 31, 2023.
    
Entity Central Index Key 0001819438    
Document Fiscal Year Focus 2023    
Document Fiscal Period Focus FY    
Amendment Flag false    
Common Stock      
Entity Information [Line Items]      
Title of 12(b) Security Common Stock, $0.0001 par value per share    
Trading Symbol GWH    
Security Exchange Name NYSE    
Warrant      
Entity Information [Line Items]      
Title of 12(b) Security Warrants, each whole warrant exercisable for one share of common stock at an exercise price of $11.50    
Trading Symbol GWH.W    
Security Exchange Name NYSE    
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Audit Information
 12 Months Ended
Dec. 31, 2023
Auditor Information [Abstract]  
Auditor Firm ID 185
Auditor Name KPMG LLP
Auditor Location Portland, Oregon
v3.24.0.1
Consolidated Balance Sheets - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Current assets:    
Cash and cash equivalents $ 20,165 $ 34,767
Restricted cash, current 1,373 1,213
Accounts receivable, net 1,990 4,952
Short-term investments 87,899 105,047
Inventory 3,366 0
Prepaid expenses and other current assets 3,305 5,657
Total current assets 118,098 151,636
Property and equipment, net 16,266 17,570
Intangible assets, net 4,923 0
Operating lease right-of-use assets 2,167 3,401
Restricted cash, non-current 945 675
Other non-current assets 833 271
Total assets 143,232 173,553
Current liabilities:    
Accounts payable 2,755 3,036
Accrued and other current liabilities 10,755 14,125
Accrued product warranties 2,129 1,643
Operating lease liabilities, current 1,581 1,421
Deferred revenue, current 2,546 6,168
Notes payable, current 0 1,600
Total current liabilities 19,766 27,993
Notes payable, non-current 0 315
Operating lease liabilities, non-current 957 2,535
Deferred revenue 18,200  
Common stock warrant liabilities 917 3,209
Other non-current liabilities 0 85
Total liabilities 39,875 36,579
Commitments and contingencies (Note 11)  
Stockholders’ equity:    
Preferred stock ($0.0001 par value, 200,000,000 shares authorized, none issued and outstanding as of December 31, 2023 and 2022) 0 0
Common stock ($0.0001 par value; 2,000,000,000 shares authorized, 174,211,911 and 153,821,339 shares issued and outstanding as of December 31, 2023 and 2022, respectively) 18 16
Additional paid-in capital 799,496 755,537
Accumulated deficit (696,157) (618,579)
Total stockholders’ equity 103,357 136,974
Total liabilities and stockholders’ equity 143,232 173,553
Nonrelated party    
Current liabilities:    
Deferred revenue 3,835 2,442
Related party    
Current liabilities:    
Deferred revenue $ 14,400 $ 0
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Consolidated Balance Sheets (Parenthetical) - $ / shares
Dec. 31, 2023
Dec. 31, 2022
Statement of Financial Position [Abstract]    
Preferred stock, par value (in USD per share) $ 0.0001 $ 0.0001
Preferred stock, shares authorized (in shares) 200,000,000 200,000,000
Preferred stock, shares outstanding (in shares) 0 0
Preferred stock, shares issued (in shares) 0 0
Common stock, par value (in USD per share) $ 0.0001 $ 0.0001
Common stock, shares authorized (in shares) 2,000,000,000 2,000,000,000
Common stock, shares issued (in shares) 174,211,911 153,821,339
Common stock, shares outstanding (in shares) 174,211,911 153,821,339
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Consolidated Statements of Operations and Comprehensive Loss - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Revenue:    
Total revenue $ 7,540 $ 894
Cost of revenue 20,495 0
Gross profit (loss) (12,955) 894
Operating expenses:    
Research and development 42,632 71,979
Sales and marketing 7,744 6,938
General and administrative 22,574 27,469
Total operating expenses 72,950 106,386
Loss from operations (85,905) (105,492)
Other income (expenses), net:    
Interest income, net 5,262 2,187
Gain on revaluation of common stock warrant liabilities 2,292 25,788
Other income (expense), net 773 (452)
Total other income, net 8,327 27,523
Net loss to common stockholders (77,578) (77,969)
Comprehensive loss to common stockholders $ (77,578) $ (77,969)
Net loss per share, basic (in USD per share) $ (0.48) $ (0.51)
Net loss per share, diluted (in USD per share) $ (0.48) $ (0.51)
Weighted average shares used in per share calculation, basic (in shares) 159,958,645 152,676,155
Weighted average shares used in per share calculation, diluted (in shares) 159,958,645 152,676,155
Nonrelated party    
Revenue:    
Total revenue $ 7,537 $ 610
Related party    
Revenue:    
Total revenue $ 3 $ 284
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Consolidated Statements of Stockholders' Equity - USD ($)
$ in Thousands
Total
Common Stock
Additional Paid-In Capital
Accumulated Deficit
Balance at beginning of period (in shares) at Dec. 31, 2021   151,839,058    
Balance at beginning of period at Dec. 31, 2021 $ 205,159 $ 16 $ 745,753 $ (540,610)
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Issuance of common stock under stock-based compensation plans, net of stock withheld for taxes (in shares)   2,226,463    
Issuance of common stock under stock-based compensation plans, net of stock withheld for taxes 657   657  
Cancellation of shares used to settle payroll tax withholding (in shares)   (244,202)    
Cancellation of shares used to settle payroll tax withholding (2,808)   (2,808)  
Warrants issued 46   46  
Warrants exercised (in shares)   20    
Stock-based compensation expense 11,889   11,889  
Net loss $ (77,969)     (77,969)
Balance at end of period (in shares) at Dec. 31, 2022 153,821,339 153,821,339    
Balance at end of period at Dec. 31, 2022 $ 136,974 $ 16 755,537 (618,579)
Increase (Decrease) in Stockholders' Equity [Roll Forward]        
Issuance of common stock under stock-based compensation plans, net of stock withheld for taxes (in shares)   3,898,818    
Issuance of common stock under stock-based compensation plans, net of stock withheld for taxes 468   468  
Stock-based compensation expense 10,635   10,635  
Shares issued (in shares)   16,491,754    
Proceeds from transaction 32,858 $ 2 32,856  
Net loss $ (77,578)     (77,578)
Balance at end of period (in shares) at Dec. 31, 2023 174,211,911 174,211,911    
Balance at end of period at Dec. 31, 2023 $ 103,357 $ 18 $ 799,496 $ (696,157)
v3.24.0.1
Consolidated Statements of Stockholders' Equity (Parenthetical)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
USD ($)
Statement of Stockholders' Equity [Abstract]  
Issuance costs $ 368
v3.24.0.1
Consolidated Statements of Cash Flows - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Cash flows from operating activities:    
Net loss $ (77,578) $ (77,969)
Adjustments to reconcile net loss to net cash used in operating activities:    
Depreciation and amortization 6,513 1,523
Non-cash interest income (3,635) (1,349)
Non-cash lease expense 1,234 1,134
Stock-based compensation expense 10,635 11,889
Inventory write-down and losses on noncancellable purchase commitments 11,932 0
Change in fair value of common stock warrant liabilities (2,292) (25,788)
Other non-cash income and expenses, net (60) 483
Changes in operating assets and liabilities:    
Accounts receivable, net 3,633 (1,886)
Inventory (14,661) 0
Prepaid expenses and other current assets 2,422 (311)
Accounts payable (229) 1,464
Accrued and other current liabilities (3,378) 6,789
Accrued product warranties 486 1,643
Deferred revenue 11,500 1,881
Operating lease liabilities (1,418) (1,123)
Net cash used in operating activities (54,896) (81,620)
Cash flows from investing activities:    
Purchases of property and equipment (5,790) (14,180)
Maturities and purchases of short-term investments, net 20,861 (103,704)
Net cash provided by (used in) investing activities 15,071 (117,884)
Cash flows from financing activities:    
Proceeds from issuance of common stock and common stock warrants, net of issuance costs 27,132 0
Payments on notes payable (1,733) (1,900)
Proceeds from stock options exercised 237 0
Repurchase of shares from employees for income tax withholding purposes (310) (2,808)
Proceeds from contributions to Employee Stock Purchase Plan 541 492
Proceeds from warrants exercised 0 165
Other, net (214) (22)
Net cash provided by (used in) financing activities 25,653 (4,073)
Net change in cash, cash equivalents and restricted cash (14,172) (203,577)
Cash, cash equivalents and restricted cash, beginning of period 36,655 240,232
Cash, cash equivalents and restricted cash, end of period 22,483 36,655
Supplemental disclosures of cash flow information:    
Cash paid for operating leases included in cash used in operating activities 1,670 1,625
Cash paid for interest 0 154
Non-cash investing and financing transactions:    
Common stock warrants issued for the acquisition of intangible assets 4,990 0
Purchase of property and equipment included in accounts payable and accrued and other current liabilities 704 1,358
Right-of-use operating lease assets obtained in exchange for lease obligations 0 4,534
Right-of-use finance lease assets obtained in exchange for lease obligations 0 123
Warrant vested under contracts with customers 0 46
Cash and cash equivalents 20,165 34,767
Restricted cash, current 1,373 1,213
Restricted cash, non-current 945 675
Total cash, cash equivalents and restricted cash shown in the statements of cash flows $ 22,483 $ 36,655
v3.24.0.1
DESCRITPION OF BUSINESS, BASIS OF PRESENTATION AND RISKS AND UNCERTAINTIES
 12 Months Ended
Dec. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
DESCRITPION OF BUSINESS, BASIS OF PRESENTATION AND RISKS AND UNCERTAINTIES DESCRIPTION OF BUSINESS, BASIS OF PRESENTATION AND RISKS AND UNCERTAINTIES
Description of Business—ESS Tech, Inc. is a long-duration energy storage company specializing in iron flow battery technology. ESS develops long-duration iron flow batteries for commercial and utility-scale energy storage applications requiring four or more hours of flexible energy capacity predominantly using earth-abundant materials. The Company has historically been in the research and development phase. On a quarterly basis the Company had evaluated a combination of evidence including production quality metrics, field functionality to date, revenue trends, and existing contracts with customers. Based on the evaluation performed during the third quarter of 2023, the Company transitioned out of the research and development phase and into commercial inventory accounting as of July 1, 2023.
The Company was originally incorporated as a Cayman Islands exempted company on July 21, 2020 as a publicly traded special purpose acquisition company under the name ACON S2 Acquisition Corp. for the purpose of effecting a business combination. On October 8, 2021, the Company consummated a business combination pursuant to the merger agreement, dated May 6, 2021, by and among STWO, SCharge Merger Sub, Inc., a Delaware corporation and wholly owned direct subsidiary of STWO, and ESS Tech, Inc., a Delaware corporation, wherein Merger Sub merged with and into Legacy ESS, with Legacy ESS surviving as a wholly owned subsidiary of STWO. On the Closing Date, STWO changed its name from “ACON S2 Acquisition Corp.” to “ESS Tech, Inc.”, and its shares of common stock and warrants for shares of common stock commenced trading on the New York Stock Exchange under the ticker symbols “GWH” and “GWH.W,” respectively.
Basis of Presentation—The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Risks and Uncertainties—The Company is subject to a number of risks associated with companies of similar size in its industry, including, but not limited to, the need for successful development of products, the need for additional capital and financing to fund operations, competition from substitute products and services from larger companies, legal protection of proprietary technology, patent litigation, dependence on key individuals, and risks associated with changes in information technology.
Concentration of Credit Risk—Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents and restricted cash. The Company’s cash and cash equivalents include cash in bank accounts, money market funds, and investments with a maturity of three months or less at the date of purchase. The Company’s restricted cash includes a certificate of deposit, collateral associated with a standby letter of credit, and a performance and payment bond. Deposits held with banks may exceed the amount of insurance provided on such deposits.
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SIGNIFICANT ACCOUNTING POLICIES
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
SIGNIFICANT ACCOUNTING POLICIES SIGNIFICANT ACCOUNTING POLICIES
As discussed in Note 1, Description of Business and Basis of Presentation, during the third quarter of 2023 the Company reached commercial viability and transitioned out of the research and development phase and into commercial inventory accounting on the Transition Date. As a result of the transition, all inventoriable costs incurred are capitalized, net of any LCNRV charges, which are recognized as cost of revenue. Further, unfulfilled noncancellable purchase commitments are recognized as expense for estimated losses in cost of revenue and warranty and fulfillment costs are recorded as a component of cost of revenue rather than research and development expense beginning on the Transition Date.
Segment Information—The Company has determined that its Chief Executive Officer (“CEO”) is its chief operating decision maker. The CEO reviews financial information for purposes of assessing performance and making decisions on how to allocate resources. The Company has determined that it operates in a single reportable segment.
Substantially all of the Company’s operations and long-lived assets were attributable to operations in the United States as of December 31, 2023 and 2022.
Use of Estimates—The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of commitments and contingencies as of the date of the financial statements and the reported amounts of expenses during the reporting periods. Such estimates relate to, but are not limited to, inventory valuation, product warranty liabilities, standalone selling prices, the fair value of the Company’s investments and warrant liabilities, the
useful lives and assessment of recoverability of property and equipment, deferred tax assets valuation, as well as other accruals. These estimates are based on historical trends, market pricing, current events and other relevant assumptions and data points. Actual results could differ from those estimates and such differences may be material to the financial statements.
Reclassifications—Certain prior year amounts have been reclassified to conform with current year presentation. These reclassifications had no effect on the reported results of operations.
Cash and Cash Equivalents—Cash and cash equivalents include cash in bank accounts, money market funds, and investments with a maturity of three months or less at the date of purchase. Cash equivalents are recorded at carrying value, which approximates fair value.
Restricted Cash—Restricted cash is required as collateral for certain of the Company’s lease agreements and contractual supply and service arrangements. Restricted cash includes a certificate of deposit for the Company’s lease agreements, collateral associated with a standby letter of credit issued to a customer, and a performance and payment bond for the Company’s supply and service arrangements. The certificate of deposit and bond are recorded at carrying value, which approximates fair value. Restricted cash amounts are reported in the consolidated balance sheets as current or non-current depending on when the cash will be contractually released.
Accounts Receivable, Net—The Company evaluates the creditworthiness of its customers. If the collection of any specific receivable is doubtful, an allowance is recorded in the allowance for expected credit losses which is included in accounts receivable, net in the consolidated balance sheets. The Company had no allowance for expected credit losses recorded at either December 31, 2023 or 2022.
Inventory—As of the Transition Date, inventory consists of raw materials, work in progress, and finished goods, and is stated on a first-in, first-out basis at the lower of cost or net realizable value. Net realizable value is the estimated selling price of inventory in the ordinary course of business, less estimated costs of completion, disposal, and transportation. The Company periodically makes judgments and estimates regarding the future utility and carrying value of inventory. When inventory is adjusted to its net realizable value, a new cost basis is established and such cost is not adjusted for any potential recovery. Obsolete inventories are written off to cost of revenue. Should the Company’s estimates of future selling prices or production costs change, additional and potentially material write-downs may be required. A small change in the Company’s estimates may result in a material charge to its reported financial results.
Property and Equipment, Net—Property and equipment are stated at cost, net of depreciation. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, which range from three to seven years. Leasehold improvements are amortized over the lesser of the estimated useful lives of the assets or the remaining lease term. Expenditures for maintenance and repairs are expensed in the consolidated statements of operations and comprehensive loss as incurred. Expenditures which materially change capacities, or extend useful lives are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are recognized in other income (expense), net in the consolidated statements of operations and comprehensive loss.
The Company evaluates the recoverability of property and equipment for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The Company assesses the alternative use of an asset, the condition of the asset and the current market demand to determine if an asset is impaired. No impairment loss was recognized during the years ended December 31, 2023 and 2022.
Intangible Assets, Net—Intangible assets are stated at cost, net of accumulated amortization. Intangible assets are amortized on a straight-line basis over their expected useful lives.
Investments—Investments consist primarily of U.S. Treasury securities, U.S. agency securities, and commercial paper and are classified as trading securities as they are bought and held principally for the purpose of selling them in the near term. Trading securities are carried on the consolidated balance sheets at fair value. Unrealized gains and losses on trading securities are included in other income (expense), net in the consolidated statements of operations and comprehensive loss.
Revenue Recognition—Revenue is primarily earned from the sale, installation and commissioning of energy storage systems and is derived from customer contracts. Revenue is recognized in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring the promised goods and/or services to the customer, when or as the Company’s performance obligations are satisfied, which includes estimates for variable consideration (e.g., liquidated damages). For product sales of energy storage systems, the Company’s performance obligations are satisfied at the point in time when the customer obtains control of the system, based primarily on
shipping terms within individual customer contracts, unless specific customer acceptance criteria must be met, in which case revenue is deferred until customer acceptance has been received. No right of return exists on sales of energy storage systems.
Performance obligations for services, including the optional extended warranty and ongoing operations and maintenance program provided to customers, are satisfied over time as the respective services are performed.
The transaction price of the underlying customer agreement is allocated to each performance obligation based on its relative standalone selling price. When the standalone selling price is not directly observable, revenue is determined based on an estimate of selling price using the observable market price that the good or service sells for separately in similar circumstances and to similar customers, and/or an expected cost plus margin approach when the observable selling price of a good or services is not known and is either highly variable or uncertain.
The Company invoices customers in accordance with customer agreements, which in certain circumstances may be in advance of recognizing revenue if the Company has not satisfied the associated performance obligations. Payment terms generally include advance payments to reserve capacity and/or upon issuance of the customer’s purchase order with the remainder due upon the achievement of various milestones including but not limited to shipment readiness, delivery, commissioning of the system, and completion of final site testing. Advanced customer payments and unsatisfied performance obligations are recognized as deferred revenue in the consolidated balance sheets.
Sales tax collected from customers is recorded on a net basis and therefore, not included in revenue. Sales tax is recorded as a liability until remitted to governmental authorities. Shipping and handling, freight costs and other reimbursable costs are accounted for as fulfillment activities and included in revenue.
Cost of Revenue—As of the Transition Date, cost of revenue includes the cost of the energy storage systems delivered, installed and commissioned during the year. It includes direct and indirect materials, labor costs, manufacturing overhead, including depreciation costs of tooling and machinery, adjustments to warranty expense, LCNRV charges, unfulfilled noncancellable purchase commitment expense, shipping and logistics costs, and provisions for excess and obsolete inventory. Additionally, cost of revenue benefits from production credits earned.
Product Warranties—Warranty obligations are incurred in connection with the sale of the Company’s products. The Company generally provides a standard warranty for a period of one year and an optional extended warranty. The standard warranty is accounted for as an assurance-type warranty, which provides customers with assurance that the product complies with agreed-upon specifications and does not represent a separate performance obligation. The extended warranty is considered a service-type warranty which is a distinct service and a portion of the transaction price is allocated to that performance obligation.
Costs to provide for standard warranty obligations are estimated and recorded as a liability at the time revenue is recognized on the sale of the energy storage system. Warranty reserves include management’s best estimate of the projected costs to repair or to replace any items under warranty, which is based on various factors, including the use of actual claim data to date. Initial accruals and adjustments to warranty reserves were recorded to research and development expenses when the Company was in the research and development phase and are now recorded to cost of revenue following the transition to commercial inventory accounting as of the Transition Date.
Sales and Marketing—Sales and marketing expenses consist primarily of salaries, benefits and stock-based compensation for marketing and sales personnel and related support teams. To a lesser extent, sales and marketing expenses also include professional services costs, travel costs, and trade show sponsorships and participation. Advertising costs are expensed as incurred.
Research and Development—Research and development costs are expensed as incurred and, as of the Transition Date, consist of materials, supplies, personnel-related expenses, allocated facilities costs, consulting services and other direct expenses. Personnel-related expenses consist of salaries, benefits and stock-based compensation. Substantially all of the Company’s research and development expenses are related to improving existing products and developing new products and related technologies. Prior to the Transition Date, research and development costs also included direct product development material costs, including freight charges, and product development personnel-related expenses, warranty-related costs, depreciation charges, overhead related costs, consulting services, and other direct expenses.
The Company receives funding from federal agencies for research and development activities related to its products. Under certain circumstances, up to the entire amount of funding may need to be repaid to the grantor in the form of a success fee in future periods if the Company monetized the results of the activities funded by the grantor. The portion of such funding the Company may be required to pay in certain circumstances is recorded in accrued and other current liabilities in the consolidated balance sheets and was $452 thousand as of December 31, 2022.
General and Administrative—General and administrative expenses consist of personnel-related expenses for the Company’s corporate, executive, finance, legal, and other administrative functions, as well as expenses for outside professional services and insurance costs. Personnel-related expenses consist of salaries, benefits and stock-based compensation. To a lesser extent, general and administrative expenses include depreciation and other allocated costs, such as facility-related expenses and supplies.
Stock-Based Compensation— The Company measures and recognizes compensation expense for all stock-based awards based on estimated fair values on the date of the grant, recognized over the requisite service period. For awards that vest solely based on a service condition, the Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. The compensation expense related to stock-based awards with performance conditions is recognized over the requisite service period when achievement of the performance conditions is probable. The compensation expense related to stock-based awards with market conditions is recognized on an accelerated attribution basis over the requisite service period identified as the derived service period over which the market conditions are expected to be achieved, and is not reversed if the market condition is not satisfied. The Company accounts for forfeitures as they occur. Stock-based awards granted to employees are primarily stock options and RSUs.
The fair value of each stock option granted is estimated using the Black-Scholes Merton option-pricing model using the single-option award approach. The following assumptions are used in the Black-Scholes Merton option-pricing model:
Risk-Free Interest Rate—The risk-free interest rate is based on the implied yield available on the date of grant on U.S. Treasury zero-coupon bonds issued with a term that is equal to the option’s expected term at the grant date.
Expected Volatility—The Company estimates the volatility for option grants by evaluating the average historical volatility of a peer group of companies for the period immediately preceding the option grant for a term that is approximately equal to the option’s expected term.
Expected Term—The expected term for employees represents the period over which options granted are expected to be outstanding using the simplified method, as the Company’s historical share option exercise experience does not provide a reasonable basis upon which to estimate the expected term. The simplified method deems the term to be the average of the time-to-vesting and contractual life of the stock-based awards.
Dividend Yield—The Company has not declared or paid dividends to date and does not anticipate declaring dividends. As such, the dividend yield has been estimated to be zero.
Income Taxes—The Company accounts for income taxes under the asset and liability method. Under this method, deferred taxes are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using tax rates expected to be in effect during the years in which the bases differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the consolidated statement of operations and comprehensive loss in the period that includes the enactment date.
ASC 740, Accounting for Income Taxes (“ASC 740”), requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on the Company’s ability to generate sufficient taxable income within the carryforward period. Because of the Company’s history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely and, accordingly, has provided a full valuation allowance for these tax benefits for the years ended December 31, 2023 and 2022.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. No amounts were accrued for the payment of interest and penalties as of December 31, 2023 and 2022. The Company is currently not aware of any issues under review that could result in significant payments, accruals, or material deviation from its position.
Net Loss Per Share—The Company will use the two-class method when computing net loss per common share when shares are issued that meet the definition of participating securities. Under this method, net earnings are reduced by the amount of dividends declared in the current period for common stockholders and participating security holders. The remaining earnings or “undistributed earnings” are allocated between common stock and participating securities to the extent that each security may share in earnings as if all the earnings for the period had been distributed. Once calculated, the earnings per common share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during each year presented. Diluted loss attributable to common stockholders per common share has been computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding plus the dilutive effect of outstanding
options, warrants, and restricted stock units (“RSUs”) during the respective periods. In cases where the Company has a net loss, no dilutive effect is shown as options, warrants, and RSUs become anti-dilutive.
Fair Value—The Company follows ASC 820, Fair Value Measurements (“ASC 820”), which establishes a common definition of fair value to be applied when U.S. GAAP requires the use of fair value, establishes a framework for measuring fair value, and requires certain disclosures about such fair value measurements.
ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about what market participants would use in pricing the asset or liability based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:
Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities to which the Company has access at a measurement date.
Level 2: Observable inputs other than Level 1 quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in an active market, quoted prices for identical assets and 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.
Level 3: Unobservable inputs for which little or no market data exists and for which the Company must develop its own assumptions regarding the assumptions that market participants would use in pricing the asset or liability, including assumptions regarding risk.
Because of the uncertainties inherent in the valuation of assets or liabilities for which there are no observable inputs, those estimated fair values may differ significantly from the values that may have been used had a ready market for the assets or liabilities existed.
Emerging Growth Company—Pursuant to the JOBS Act of 2012, Section 102(b)(1), an emerging growth company is provided the option to adopt new or revised accounting standards that may be issued by the FASB or the SEC either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. The Company has elected to use the extended transition period for complying with any new or revised financial accounting standards. As a result, the Company’s consolidated financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective date for new or revised accounting standards that are applicable to public companies. The Company also intends to continue to take advantage of some of the reduced regulatory and reporting requirements of emerging growth companies pursuant to the JOBS Act so long as the Company qualifies as an emerging growth company.
Recent Accounting Pronouncements—In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU updates reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU requires disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker, a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the chief operating decision maker when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires retrospective application to all prior periods presented in the financial statements. The Company is currently evaluating the effect that the adoption of this ASU may have on the Company’s disclosures.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU requires greater disaggregation of income tax disclosures primarily on the income tax rate reconciliation and income taxes paid. This authoritative guidance will be effective for the Company starting in fiscal year ending December 31, 2025, with early adoption permitted. The Company is currently evaluating the effect of this new standard on the Company's disclosures.
Recently Adopted Accounting Pronouncements—On January 1, 2023, the Company adopted ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model, which will result in earlier recognition of credit losses. The adoption did not result in a material impact to the Company’s consolidated financial statements or related disclosures. In future periods, as
revenue and accounts receivable increase, ASU 2016-13 could have a material impact on its consolidated financial statements.
v3.24.0.1
INVENTORY
 12 Months Ended
Dec. 31, 2023
Inventory Disclosure [Abstract]  
INVENTORY INVENTORY
Inventory consists of the following (in thousands):
December 31, 2023December 31, 2022
Raw materials$7,740 $— 
Work in process1,236 — 
Finished goods5,685 — 
Inventory, gross$14,661 $— 
Net realizable value adjustment(11,295)— 
Inventory$3,366 $— 
The Company recorded a $11.3 million charge to reflect the LCNRV of inventory during the year ended December 31, 2023 and none in the prior year within cost of revenue in the Company’s consolidated statements of operations and comprehensive loss. The Company has firm purchase commitments and recorded LCNRV losses of $637 thousand related to these firm purchase commitments as of December 31, 2023 to cost of revenue in the Company’s consolidated statements of operation and comprehensive loss. These LCNRV losses related to firm purchase commitments are reflected in the materials and related purchases component of accrued and other liabilities on the consolidated balance sheets as of the Transition Date. For further details, refer to Note 11, Commitments and Contingencies.
v3.24.0.1
PREPAID EXPENSES AND OTHER CURRENT ASSETS
 12 Months Ended
Dec. 31, 2023
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
PREPAID EXPENSES AND OTHER CURRENT ASSETS PREPAID EXPENSES AND OTHER CURRENT ASSETS
Prepaid expenses and other current assets consist of the following (in thousands):
December 31, 2023December 31, 2022
Insurance$521 $2,033 
Vendor advances936 3,147 
Grants receivable824 — 
IT related401 390 
Contract assets253 — 
Other370 87 
Total prepaid expenses and other current assets$3,305 $5,657 
v3.24.0.1
PROPERTY AND EQUIPMENT, NET
 12 Months Ended
Dec. 31, 2023
Property, Plant and Equipment [Abstract]  
PROPERTY AND EQUIPMENT, NET PROPERTY AND EQUIPMENT, NET
Property and equipment, net consist of the following (in thousands):
December 31, 2023December 31, 2022
Machinery and equipment$17,669 $13,699 
Furniture and fixtures184 184 
Leasehold improvements3,232 3,115 
Software183 183 
Construction in process4,279 3,230 
Total property and equipment25,547 20,411 
Less: accumulated depreciation(9,281)(2,841)
Total property and equipment, net$16,266 $17,570 
Depreciation expense was $6.4 million and $1.5 million for the years ended December 31, 2023 and 2022, respectively.
v3.24.0.1
INTANGIBLE ASSETS, NET
 12 Months Ended
Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
INTANGIBLE ASSETS, NET INTANGIBLE ASSETS, NET
In September 2023, the Company acquired patents valued at $5.0 million under a Patent License Agreement with UOP, an affiliate of Honeywell, a related party. These patents were recorded at fair value based on the value of the IP Warrants issued, as defined in Note 12, Common Stock Warrants, and are amortized over an average useful life of 19
years based on the remaining useful lives of the patents acquired. Amortization expense for the year ended December 31, 2023 was $67 thousand.
Intangible assets, net, consisted of the following (in thousands):
December 31, 2023December 31, 2022
Patents$4,990 $— 
Less: accumulated depreciation(67)— 
Intangible assets, net$4,923 $— 
Estimated future amortization expense of intangible assets as of December 31, 2023 are as follows (in thousands):
2024$267 
2025267 
2026267 
2027267 
2028267 
Thereafter3,588 
Total future amortization$4,923 
v3.24.0.1
ACCRUED AND OTHER CURRENT LIABILITIES
 12 Months Ended
Dec. 31, 2023
Payables and Accruals [Abstract]  
ACCRUED AND OTHER CURRENT LIABILITIES ACCRUED AND OTHER CURRENT LIABILITIES
Accrued and other current liabilities consist of the following (in thousands):
December 31, 2023December 31, 2022
Payroll and related benefits$5,681 $2,948 
Materials and related purchases2,083 6,892 
Professional and consulting fees802 1,011 
Amounts due to customers545 770 
Accrued capital purchases327 1,093 
Noncancellable purchase commitments637 — 
Other680 1,411 
Total accrued and other current liabilities$10,755 $14,125 
v3.24.0.1
ACCRUED PRODUCT WARRANTIES
 12 Months Ended
Dec. 31, 2023
Guarantees and Product Warranties [Abstract]  
ACCRUED PRODUCT WARRANTIES ACCRUED PRODUCT WARRANTIES
The following table summarizes product warranty activity (in thousands):
Year Ended December 31,
20232022
Accrued product warranties - beginning of period$1,643 $— 
Accruals for warranties issued3,412 2,612 
Repairs and replacements(1,416)(969)
Adjustments to existing accruals(1,510)— 
Accrued product warranties - end of period$2,129 $1,643 
v3.24.0.1
LEASES
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
LEASES LEASES
The Company leases office and manufacturing space in Wilsonville, Oregon under operating leases. Each of the operating leases provides the Company an option to renew the lease for an additional 60 months which have not been included in the operating lease obligations.
The Company determines if an arrangement is a lease at inception and whether the arrangement is classified as an operating or finance lease. At commencement of the lease, the Company records a right-of-use (“ROU”) asset and lease liability in the consolidated balance sheets based on the present value of lease payments over the term of the arrangement. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. As the Company’s leases do not provide an
implicit rate, it uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company determines its incremental borrowing rate based on publicly available data for instruments with similar characteristics, including recently issued debt, as well as other factors. Contract terms may include options to extend or terminate the lease, and when the Company deems it reasonably certain that ESS will exercise that option it is included in the ROU asset and lease liability. Operating leases will reflect lease expense on a straight-line basis, while finance leases will result in the separate presentation of interest expense on the lease liability and amortization expense of the ROU asset.
ROU assets related to the Company’s operating leases are included in operating lease ROU assets, while the corresponding lease liabilities are included in current and non-current operating lease liabilities on the Company’s consolidated balance sheets. ROU assets related to the Company’s finance leases are included in other non-current assets, while the corresponding lease liabilities are included in accrued and other current liabilities and other non-current liabilities on the Company’s consolidated balance sheets.
The Company does not record leases with a term of 12-months or less in the consolidated balance sheets. Short-term lease costs were immaterial for the year ended December 31, 2023.
Operating lease expense for the years ended December 31, 2023 and 2022 was $1.5 million. Finance lease costs for the years ended December 31, 2023 and 2022 were immaterial.
As of December 31, 2023, future maturities of lease liabilities are as follows (in thousands):
Operating Leases
2024$1,720 
2025983 
Thereafter— 
Total minimum lease payments$2,703 
Less: imputed interest(165)
Present value of lease liabilities$2,538 
Weighted-average remaining lease term and discount rate are as follows:
December 31, 2023December 31, 2022
Weighted-average remaining lease term (in years)1.72.6
Weighted-average discount rate7.5 %7.5 %
v3.24.0.1
BORROWINGS
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
BORROWINGS BORROWINGS
Borrowings consist of the following (in thousands):
December 31, 2023December 31, 2022
Total notes payable$— $1,915 
Less current portion of notes payable— 1,600 
Notes payable, non-current$— $315 
Notes Payable
As of December 31, 2022, the Company had $1.9 million of outstanding notes payable to a bank which were secured by all property of the Company, except for its intellectual property. The notes payable bore interest at 0.50% below the bank’s prime rate. The Company made monthly interest and principal payments on the notes payable based on the schedule defined in the agreement. On July 7, 2023, the Company elected to repay all outstanding notes payable with a payment of $1.0 million to First Citizens Bank. The transaction amount repaid the outstanding principal balance, interest and a final payment due of $200 thousand.
v3.24.0.1
COMMITMENTS AND CONTINGENCIES
 12 Months Ended
Dec. 31, 2023
Commitments and Contingencies Disclosure [Abstract]  
COMMITMENTS AND CONTINGENCIES COMMITMENTS AND CONTINGENCIES
Legal Proceedings
The Company, from time to time, is a party to various claims, legal actions, and complaints arising in the ordinary course of business. The Company is not aware of any material legal proceedings or other claims, legal actions, or complaints through the date of issuance of these consolidated financial statements.
Letters of Credit
As of December 31, 2022, the Company had a standby letter of credit with First Republic Bank totaling $725 thousand as security for an operating lease of office and manufacturing space in Wilsonville, Oregon. As of December 31, 2023 the letter of credit was reduced to $75 thousand and was secured by a restricted certificate of deposit account totaling $75 thousand recorded as restricted cash, non-current. There were no draws against the letter of credit during the years ended December 31, 2023 and 2022.
On September 1, 2022, the Company executed a standby letter of credit with CitiBank, N.A., for $600 thousand as security for the performance and payment of the Company’s obligations under a customer agreement. The letter of credit is in effect until the date on which the warranty period under the agreement expires, which is anticipated to be more than a year from the balance sheet date. In June 2023, the letter of credit was transferred to Bank of America. As of December 31, 2023, $600 thousand was pledged as collateral for the letter of credit and recorded as restricted cash, non-current. There were no draws against the letter of credit during the year ended December 31, 2023.
On March 9, 2023, the Company executed a standby letter of credit with SVB for $200 thousand in support of the Company’s customs and duties due on imported materials. In June 2023, the letter of credit was transferred to Bank of America. The letter of credit is in effect until May 19, 2024. As of December 31, 2023, $200 thousand was pledged as collateral for the letter of credit and recorded as restricted cash, current. There were no draws against the letter of credit during the year ended December 31, 2023.
Purchase Commitments
The Company purchases materials from several suppliers and has entered into agreements with various contract manufacturers, which include cancellable and noncancellable purchase commitments. As of December 31, 2023 and 2022, total unfulfilled noncancellable purchase commitments were $637 thousand and $1.6 million, respectively. In addition, total unfulfilled cancellable purchase commitments amounted to $7.7 million and $14.9 million as of December 31, 2023, and 2022, respectively.
As discussed in Note 2, Significant Accounting Policies, during the third quarter of 2023 the Company exited the research and development phase and entered the commercial inventory phase and began recording unfulfilled noncancellable purchase commitments as losses within cost of revenue in the consolidated statements of operations and comprehensive loss. Prior to the Transition Date, these purchase commitments were not recorded in the consolidated financial statements as they related to the Company’s research and development activities and not the production of commercial inventory.
Joint Development Agreement
In September 2023, the Company entered into a Joint Development Agreement (“JDA”) with UOP, an affiliate of Honeywell, a related party, under which the parties would work collaboratively to engage in certain research and development activities generally related to flow battery technology. Pursuant to the JDA, the Company agreed to reimburse UOP a minimum of $8.0 million for research and development expenses incurred through December 31, 2028. No expenses were incurred under the JDA during the year ended December 31, 2023.
v3.24.0.1
COMMON STOCK WARRANTS
 12 Months Ended
Dec. 31, 2023
Equity [Abstract]  
COMMON STOCK WARRANTS COMMON STOCK WARRANTS
Common stock warrant balances consist of the following:
December 31, 2023December 31, 2022
Public Warrants outstanding11,461,227 7,377,893 
Private Warrants outstanding:
Other Private Warrants outstanding— 3,500,000 
Earnout Warrants outstanding— 583,334 
SMUD Warrant outstanding12,500 12,500 
Honeywell Warrants outstanding:
Investment Warrant outstanding10,631,633 — 
IP Warrant outstanding6,269,955 — 
Performance Warrants outstanding775,760 — 
Total common stock warrants29,151,07511,473,727
As part of STWO’s initial public offering, 8,333,287 warrants to purchase common stock (the “Public Warrants”) were sold. The Public Warrants are listed on the New York Stock Exchange (“NYSE”) under the ticker symbol “GWH.W.” The Public Warrants entitle the holder thereof to purchase one share of common stock at a price of $11.50 per share, subject to adjustments. The Public Warrants may be exercised only for a whole number of shares of common stock. No fractional shares will be issued upon exercise of the warrants. The Public Warrants expire on October 8, 2026, five years after completion of the Business Combination, or earlier upon redemption or liquidation.
The Company may call the Public Warrants for redemption starting any time, in whole and not in part, at a price of $0.01 per warrant, so long as the Company provides no less than 30 days prior written notice of redemption to each warrant holder, and if, and only if, the reported last sale price of common stock equals or exceeds $18.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders provided there is an effective registration statement covering the shares of common stock issuable upon exercise of the warrants.
The Company may call the Public Warrants for redemption starting any time, in whole and not in part, at a price of $0.10 per warrant, so long as the Company provides no less than 30 days prior written notice of redemption to each warrant holder; provided that holders will be able to exercise their warrants on a cashless basis prior to redemption and receive a number of shares determined based on the redemption date fair market value of the shares, and if, and only if, the reported last sale price of common stock equals or exceeds $10.00 per share for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date the Company sends the notice of redemption to the warrant holders provided there is an effective registration statement covering the shares of common stock issuable upon exercise of the warrants.
Simultaneously with STWO’s initial public offering, STWO issued in a private placement 4,666,667 warrants to purchase common stock (the “Private Warrants”) to STWO’s sponsor. In connection with the Business Combination, STWO’s sponsor agreed to forfeit 583,333 Private Warrants. Of the remaining 4,083,334 Private Warrants, 3,500,000 were immediately vested and 583,334 warrants (the “Earnout Warrants”) were vested upon meeting certain earnout milestone events on November 9, 2021. The Private Warrants, including the Earnout Warrants, automatically converted on a 1:1 basis into Public Warrants upon the transfer of such warrants by the initial holder to a third party during the fourth quarter of 2023.
The table below shows the common stock warrant activities during the year ended December 31, 2023:
December 31, 2022IssuedExercised
Converted(1)
December 31, 2023
Earnout Warrants583,334 — — (583,334)— 
Private Warrants (excluding Earnout Warrants)3,500,000 — — (3,500,000)— 
Public Warrants7,377,893 — — 4,083,334 11,461,227 
SMUD Warrant12,500 — — — 12,500 
Investment Warrant— 10,631,633 — — 10,631,633 
IP Warrant— 6,269,955 — — 6,269,955 
Performance Warrants— 775,760 — — 775,760 
Total common stock warrants11,473,727 17,677,348 — — 29,151,075
(1) In accordance with the terms of the Warrant Agreement, dated September 16, 2020, by and between STWO and Continental Stock Transfer & Trust Company (“Continental”), as amended by the Assignment, Assumption and Agreement, dated October 8, 2021, by and among the Company, STWO, Continental and Computershare Trust Company, N.A. (as amended, the “Warrant Agreement”), the Private Warrants, including the Earnout Warrants, automatically converted on a 1:1 basis into Public Warrants upon the transfer of such warrants by the initial holder to a third party during the fourth quarter of 2023.
The table below shows the common stock warrant activities during the year ended December 31, 2022:
December 31, 2021IssuedExercisedDecember 31, 2022
Earnout Warrants583,334 — — 583,334
Private Warrants (excluding Earnout Warrants)3,500,000 — — 3,500,000
Public Warrants7,377,913 — 207,377,893
SMUD Warrant— 12,500 — 12,500
Total common stock warrants11,461,247 12,5002011,473,727
The Company’s common stock warrants were initially recorded at fair value upon completion of the Business Combination and are adjusted to fair value at each reporting date based on the market price of the Public Warrants, with the change in fair value recorded as a component of other income (expense), net in the consolidated statements of operations and comprehensive loss. For the year ended December 31, 2023, the Company recorded a net decrease to the liabilities for Public Warrants of $2.3 million. For the year ended December 31, 2022, the Company recorded a net decrease to the liabilities for Earnout Warrants, Public Warrants and Private Warrants (Excluding Earnout Warrants) of $25.8 million.
SMUD Warrant
On September 16, 2022, the Company entered into a warrant agreement with SMUD, whereby the Company agreed to issue a warrant for up to 500,000 shares of the Company’s common stock at an exercise price of $4.296 per share. The vesting of the shares underlying the warrant will be subject to the achievement of certain commercial milestones through December 31, 2030 pursuant to a related commercial agreement. As of December 31, 2023 and 2022, 12,500 shares underlying the warrant were vested.
Honeywell Warrants
On September 21, 2023, the Company entered into the Purchase Agreement with Honeywell Ventures, an affiliate of Honeywell, a related party. Pursuant to the Purchase Agreement, Honeywell invested $27.5 million in the Company and the Company issued 16,491,754 shares of common stock and a warrant to issue up to 10,631,633 shares of common stock to Honeywell Ventures. Pursuant to the Purchase Agreement and also as further consideration for the licensing by UOP, an affiliate of Honeywell, of certain intellectual property to the Company, the Company issued a warrant to issue up to 6,269,955 shares of common stock to UOP. The Investment Warrant has an exercise price of $1.89, and the IP Warrant has an exercise price of $2.90. Each warrant will expire on September 21, 2028.
On September 21, 2023, the Company and UOP also entered into the Supply Agreement, pursuant to which UOP may purchase equipment supplied by the Company. Pursuant to the Supply Agreement, the Company agreed to issue additional warrants to purchase common stock to UOP, consisting of (i) an initial performance warrant to issue up to 775,760 shares of common stock, issued on September 21, 2023 in exchange for a prepayment of equipment by UOP in the amount of $15 million, and (ii) additional performance warrants (not to exceed an aggregate value of $15 million based on target purchase amounts of up to $300 million by 2030) to be issued on an annual basis for the five-year period beginning in 2026, based on UOP’s purchase of additional equipment after execution of the Supply Agreement. The initial Performance Warrant has an exercise price of $1.45 and the additional Performance Warrants will have an exercise price equal to the volume-weighted average price of the Company’s common stock for the last fifteen (15) trading days of the relevant calendar year for which such Performance Warrant is being issued. The initial Performance Warrant expires on September 21, 2028 and each additional Performance Warrant will have a five-year term from its respective date of issuance.
v3.24.0.1
STOCK-BASED COMPENSATION
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
STOCK-BASED COMPENSATION STOCK-BASED COMPENSATION
Stock-based compensation expense is allocated on a departmental basis based on the classification of the award holder. The following table presents the amount of stock-based compensation related to stock-based awards issued to employees on the Company’s consolidated statements of operations and comprehensive loss during the years ended December 31, 2023 and 2022 (in thousands):
20232022
Cost of revenue$1,753 $— 
Research and development2,696 2,856 
Sales and marketing816 456 
General and administrative5,370 8,577 
Total stock-based compensation$10,635 $11,889 
2021 Equity Incentive Plan
In October 2021, the Board of Directors of the Company adopted the ESS Tech, Inc. 2021 Equity Incentive Plan (the “2021 Plan”). The 2021 Plan became effective upon consummation of the Business Combination. Stock awards under the plan may be issued as Incentive Stock Options (“ISO”), Non-statutory Stock Options (“NSO”), Stock Appreciation Rights, and RSUs. Only employees are eligible to receive ISO awards. Employees, directors, and consultants who provide continuous service to the Company are eligible to receive stock awards other than ISOs. The number of shares available for issuance under the 2021 Plan will be increased on the first day of each fiscal year beginning with the 2022 fiscal year and ending with the 2031 fiscal year, in an amount equal to the lesser of (i) 15,260,000 shares, (ii) five percent (5%) of the outstanding shares on the last day of the immediately preceding fiscal year, or (iii) such number of shares determined by the Company no later than the last day of the immediately preceding fiscal year. As of January 1, 2024, the number of shares available for issuance under the 2021 Plan was increased by 8,700,000 shares in accordance with the plan and as approved by the Board. Under the 2021 Plan, the Company is authorized to issue 26,310,000 shares of common stock as of December 31, 2023.
Option prices for incentive stock options are set at the fair market value of the Company’s common stock at the date of grant. The fair market value of RSUs is set at the closing sales price of the Company’s common stock at the date of grant. Employee new hire grants generally cliff vest 1/4th at the end of the first year and then vest 1/16th each quarter over the remaining three years. Grants expire 10 years from the date of grant. All other grants vest quarterly over four years.
As of December 31, 2023, there were 5,645,585 shares available for future grant under the 2021 Plan.
Stock Options and Restricted Stock Units
Stock option and RSU activity, prices, and values during the years ended December 31, 2023 and 2022 are as follows (in thousands, except for share, per share, and contractual term data):
Options OutstandingRSUs
Number of
shares		Weighted
average
exercise price		Weighted
average
remaining
 contractual
term
(years)		Aggregate
intrinsic
values
($’000s)		Number of plan shares outstandingWeighted average
grant date fair value
per Share
Balances as of December 31, 2022
3,223,109 $1.01 7.39$4,583 6,346,955 $6.10 
Options and RSUs granted378,110 1.51 11,581,684 1.21 
Options exercised and RSUs released(703,550)0.34 (2,892,339)3.42 
Options and RSUs forfeited(299,287)0.46 (1,873,932)3.31 
Balances as of December 31, 2023
2,598,382 $1.33 6.25$1,422 13,162,368 $2.79 
Options vested and exercisable - December 31, 2022
1,947,123 $0.76 7.06$3,244 
Options vested and exercisable - December 31, 2023
1,775,256 $1.10 5.62$1,198 
The aggregate intrinsic value is the fair market value on the reporting date less the exercise price for each option. The aggregate intrinsic value of the options exercised was $0.9 million and $2.1 million during the years ended December 31, 2023 and 2022, respectively.
The fair value of each stock option award is estimated on the date of the grant using the Black-Scholes Merton option-pricing model. For options granted during the years ended December 31, 2023 and 2022, respectively, the weighted average estimated fair value using the Black-Scholes Merton option pricing model was $1.13 and $5.23 per option, respectively.
In accordance with ASC 718, the fair value of each option grant has been estimated as of the date of grant using the following weighted average assumptions:
20232022
Risk-free rate4.38 %1.64 %
Expected volatility87.08 %73.95 %
Expected term6 years6 years
Expected dividends— — 
As of December 31, 2023, there was approximately $26.0 million of unamortized stock-based compensation expense related to unvested stock options and RSUs, which is expected to be recognized over a weighted average period of 2.76 years.
Employee Stock Purchase Plan
In May 2022, the Company commenced its first offering period under the ESS Tech, Inc. Employee Stock Purchase Plan (the “ESPP”), which assists employees in acquiring a stock ownership interest in the Company. The ESPP permits eligible employees to purchase common stock at a discount through payroll deductions during specified offering periods. No employee may purchase more than $25,000 worth of stock in any calendar year. The price of shares purchased under the ESPP is equal to 85% of the fair market value of the common stock on the first or last day of the offering period, whichever is lower. Total ESPP expense for the years ended December 31, 2023 and 2022 was $324 thousand and $270 thousand, respectively.
v3.24.0.1
FAIR VALUE MEASUREMENTS
 12 Months Ended
Dec. 31, 2023
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
The following tables present the Company’s fair value hierarchy for its financial assets measured at fair value on a recurring basis (in thousands):
December 31, 2023
Cash Equivalents and Restricted CashShort-Term InvestmentsTotal Assets at Fair Value
Level 1:
Money market funds$10,126 $— $10,126 
U.S. Treasury securities— 54,681 54,681 
Total Level 110,126 54,681 64,807 
Level 2:
Certificate of deposit77 — 77 
U.S. agency securities— 12,447 12,447 
Commercial paper9,353 20,771 30,124 
Total Level 29,430 33,218 42,648 
Total assets measured at fair value$19,556 $87,899 $107,455 
December 31, 2022
Cash Equivalents and Restricted CashShort-Term InvestmentsTotal Assets at Fair Value
Level 1:
Money market funds$27,993 $— $27,993 
U.S. Treasury securities— 19,944 19,944 
Total Level 127,993 19,944 47,937 
Level 2:
Certificate of deposit75 — 75 
U.S. agency securities— 55,319 55,319 
Commercial paper5,972 29,784 35,756 
Total Level 26,047 85,103 91,150 
Total assets measured at fair value$34,040 $105,047 $139,087 
The following tables present the Company’s fair value hierarchy for its financial liabilities measured at fair value on a recurring basis (in thousands):
December 31, 2023
Level 1Level 2Level 3Total
Liabilities:
Public common stock warrants917 — — 917 
Total liabilities measured at fair value$917 $— $— $917 
December 31, 2022
Level 1Level 2Level 3Total
Liabilities:
Earnout warrant liabilities$— $163 $— $163 
Public common stock warrants2,066 — — 2,066 
Private common stock warrants— 980 — 980 
Total liabilities measured at fair value$2,066 $1,143 $— $3,209 
There were no transfers among Level 1, Level 2, or Level 3 categories during the periods presented. The carrying amounts of the Company’s notes payable and accounts payable approximate their fair values due to their short maturities.
Level 1 Assets: The Company invests in money market funds and U.S. Treasury securities. These assets are valued using observable inputs that reflect quoted prices for securities with identical characteristics.
Level 2 Assets: The Company invests in a certificate of deposit, U.S. agency securities, and commercial paper. These assets are valued using observable inputs that reflect quoted prices for securities with similar characteristics and other observable inputs (such as interest rates that are observable at commonly quoted intervals).
Level 1 Liabilities: The Company values its public common stock warrants based on the market price of the warrants.
Level 2 Liabilities: The Company values its earnout warrant liabilities and private common stock warrants based on the market price of the Company’s public common stock warrants.
For trading securities held at the reporting date, net losses recorded during the year ended December 31, 2023 and 2022 were immaterial.
v3.24.0.1
INCOME TAXES
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
INCOME TAXES INCOME TAXES
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. The significant components of deferred tax assets and liabilities are as follows (in thousands):
As of December 31,
20232022
Deferred tax assets:
Net operating losses$46,616 $34,454 
Tax credit carryforward1,454 909 
Equity compensation1,560 737 
Capitalized research and development expenses19,644 16,946 
Inventory reserve3,159 — 
Deferred revenue1,002 — 
Other2,761 2,153 
Total deferred tax assets76,196 55,199 
Valuation allowance(75,590)(54,261)
Deferred tax assets, net of valuation allowance606 938 
Deferred tax liabilities:
Right-of-use assets(606)(938)
Net deferred tax$— $— 
The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017. Included in the Act is the requirement to capitalize and amortize research and development expenditures beginning in 2022. Prior to 2022, the Company had been expensing these costs as incurred for tax purposes. The capitalization of the research and development expenditures resulted in a new deferred tax asset of $16.9 million in 2022, and which was offset by a valuation allowance, resulting in no significant impact to income tax expense for the year ended December 31, 2022.
ASC 740 requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on the Company’s ability to generate sufficient taxable income within the carryforward period. Because of the Company’s history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely and, accordingly, has provided a valuation allowance for fiscal years 2023 and 2022. The valuation allowance increased by $21.3 million during the year ended December 31, 2023.
As of December 31, 2023, the Company has federal and state net operating loss carryforwards of $166.3 million and $202.4 million, respectively. Federal net operating losses generated prior to 2018 will start to expire in 2032. Federal net operating losses generated after 2017 do not expire. The state net operating losses will begin to expire in 2027. The Company also has federal and state research and development tax credit carryforwards totaling $2.9 million and $28 thousand, respectively. The federal research and development credit carryforwards begin to expire in 2039, unless previously utilized. The state research and development credit carryforwards do not expire.
The effective tax rate of the Company’s provision for income taxes differs from the federal statutory rate as follows:
Years Ended December 31,
20232022
Federal statutory tax rate21.0 %21.0 %
State tax, net of federal tax benefit6.8 7.2 
Stock compensation(1.9)(0.2)
Non-deductible officer compensation0.8 (1.4)
Warrant liabilities revaluation0.6 6.6 
Earnout Shares liabilities revaluation— 0.4 
Permanent differences(0.1)0.1 
Research and development tax credits0.5 0.8 
Other(0.1)0.1 
Valuation allowance(27.6)(34.6)
Effective tax rate— %— %
The changes in the Company's uncertain tax positions are summarized as follows (in thousands):
Balance as of December 31, 2021
$292 
Additions related to prior year— 
Additions related to current year613 
Balance as of December 31, 2022
905 
Additions related to prior year170 
Additions related to current year382 
Balance as of December 31, 2023
$1,457 
During the years ended December 31, 2023 and 2022, the Company recognized uncertain tax positions of $382 thousand and $613 thousand, respectively, related to a reduction of the research and development credit deferred tax asset. Unrecognized tax benefits may change during the next twelve months for items that arise in the ordinary course of business. The Company does not expect a material change to its unrecognized tax benefits over the next twelve months that would have an adverse effect on its operating results.
The Company recognizes interest and penalties accrued on any unrecognized tax benefits as a component of income tax expense. The Company had no accrued interest or penalties related to uncertain tax positions as of 2023 and 2022.
The Company files federal and certain state income tax returns, which provide varying statutes of limitations on assessments. However, because of net operating loss carryforwards, substantially all tax years since inception remain open to federal and state tax examination.
Utilization of net operating losses and research and development credit carryforwards may be subject to annual limitations due to ownership changes that have occurred or that could occur in the future, as required by Sections 382 and 383 of the Code, as well as similar state provisions. These ownership changes may limit the amount of net operating losses and research and development credit carryforwards that can be utilized annually to offset future taxable income and tax, respectively. In general, an "ownership change" as defined by Section 382 of the Code results from a transaction or series of transactions over a three-year period resulting in an ownership change of more than 50 percentage points of outstanding stock of a company by certain stockholders. Due to the existence of the valuation allowance, limitations created by past ownership changes, if any, will not impact its effective tax rate.
v3.24.0.1
GOVERNMENT GRANTS
 12 Months Ended
Dec. 31, 2023
Government Assistance [Abstract]  
GOVERNMENT GRANTS GOVERNMENT GRANTS
Inflation Reduction Act of 2022 (“IRA”)
On August 16, 2022, President Biden signed the Inflation Reduction Act of 2022 into law. The IRA has significant economic incentives for both energy storage customers and manufacturers for projects placed in service after December 31, 2022. Starting in 2023, there are Production Tax Credits under Internal Revenue Code 45X, that can be claimed on battery components manufactured in the U.S. and sold to U.S. or foreign customers. The tax credits available to manufacturers include a credit for ten percent of the cost incurred to make electrode active materials in addition to credits of $35 per kWh of capacity of battery cells and $10 per kWh of capacity of battery modules. The credits are cumulative, meaning that companies will be able to claim each of the available tax credits based on the
battery components produced and sold through 2029, after which the PTC will begin to gradually phase down through 2032.
Since the PTC is a refundable credit (i.e., a credit with a direct-pay option available), the PTC is outside the scope of ASC 740, Income Taxes (“ASC 740”). Therefore, the Company accounts for the PTC under a government grant model. GAAP does not address the accounting for government grants received by a business entity that are outside the scope of ASC 740. The Company’s accounting policy is to analogize to IAS 20, Accounting for Government Grants and Disclosure of Government Assistance, under IFRS Accounting Standards. Under IAS 20, once it is reasonably assured that the entity will comply with the conditions of the grant, the grant money should be recognized on a systematic basis over the periods in which the entity recognizes the related expenses or losses for which the grant money is intended to compensate. The Company recognizes grants once it is probable that both of the following conditions will be met: (1) the Company is eligible to receive the grant and (2) the Company is able to comply with the relevant conditions of the grant.
The PTC is recorded as the applicable items are produced and sold. For the year ended December 31, 2023, the Company recognized PTC of $824 thousand as a reduction of cost of revenue on the consolidated statements of operations and comprehensive loss. As of December 31, 2023, grant receivable related to the PTC in the amount of $824 thousand is recorded in prepaid expenses and other current assets on the consolidated balance sheets.
v3.24.0.1
REVENUE
 12 Months Ended
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]  
REVENUE REVENUE
Disaggregated Revenue
The following table presents the Company’s revenue, disaggregated by source (in thousands):
Year Ended December 31,
20232022
Product revenue$5,103 $803 
Service revenue183 91 
Other revenue2,254 — 
Total revenue$7,540 $894 
The majority of the Company’s revenue is derived from the product sales of energy storage systems. During 2023 other revenue included engineering services the Company performed in support of a customer project site and revenue earned for services performed to date under project contracts that were ultimately terminated. See Note 2, Significant Accounting Policies for further information regarding revenue recognition.
Contract Balances
Contract assets relate to unbilled amounts resulting from contract arrangements in which the related revenue recognition performance obligations have been satisfied, however invoicing to the customer has not yet occurred. Deferred revenue (or contract liabilities) relates to consideration received from customers in advance of the Company satisfying the revenue recognition performance obligations under the related contractual arrangements. Contract balances are reported in a net contract asset or deferred revenue liability position on a contract-by-contract basis at the end of each reporting period. Contract assets are included in prepaid expenses and other current assets and deferred revenue is presented separately on the consolidated balance sheets.
The following table provides information about contract assets and deferred revenue from contracts with customers (in thousands):
December 31, 2023December 31, 2022
Contract assets$253 11 
Deferred revenue20,781 8,610 
Contract assets increased by $242 thousand during the year ended December 31, 2023 due to the recognition of revenues for which invoicing had not yet occurred. Deferred revenue increased by $12.2 million during the year ended December 31, 2023, reflecting $19.0 million in customer advance payments, offset by the recognition of $6.3 million of revenue that was included in the deferred revenue balance at the beginning of the period, $506 thousand of deposits returned to customers, and $244 thousand of reclassifications to accrued and other current liabilities due to changes in the estimation of variable consideration.
Deferred revenue of $2.5 million is expected to be recognized within the next 12 months and non-current deferred revenue of $18.2 million is expected to be recognized thereafter.
v3.24.0.1
DEFINED CONTRIBUTION PLAN
 12 Months Ended
Dec. 31, 2023
Retirement Benefits [Abstract]  
DEFINED CONTRIBUTION PLAN DEFINED CONTRIBUTION PLANThe Company has a 401(k) plan to provide defined contribution retirement benefits for all employees who have completed six months of service. Employees may elect to contribute a portion of their pretax compensation to the 401(k) plan, subject to annual limitations. The Company may make profit-sharing contributions at the discretion of the Board of Directors. Employee contributions are always fully vested. For the years ended December 31, 2023 and 2022, the Company contributed $853 thousand and $674 thousand, respectively.
v3.24.0.1
RELATED PARTY TRANSACTIONS
 12 Months Ended
Dec. 31, 2023
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS RELATED PARTY TRANSACTIONS
During the year ended December 31, 2023, the Company recognized revenue of $33 thousand for the sale of extended warranty services and reimbursable shipping and freight costs to related parties. During the year ended December 31, 2022, the Company recognized recorded revenue of $284 thousand for sales of energy storage systems and extended warranty services to related parties.
As of December 31, 2023, the Company had recorded deferred revenue of $1 thousand for sales of extended warranty services to related parties and $29 thousand of outstanding accounts receivable from related parties. As of December 31, 2022, the Company had recorded deferred revenue of $5 thousand for sales of energy storage systems to related parties.
Effective September 21, 2023, Honeywell became a related party as a result of the common stock and common stock warrants issued as described in Note 12, Common Stock Warrants. As of December 31, 2023, the Company recorded a non-refundable deposit for future equipment purchases by Honeywell of $15.0 million in deferred revenue, with $600 thousand in current deferred revenue and $14.4 million in non-current deferred revenue, and an asset of $736 thousand for the value of the initial Performance Warrant issued to Honeywell within other non-current assets on the consolidated balance sheets. The value of the initial Performance Warrant will be recognized as an offset to revenue in the period in which revenue is earned.
v3.24.0.1
NET LOSS PER SHARE
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
NET LOSS PER SHARE NET LOSS PER SHARE
The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders for the years ended December 31, 2023 and 2022 (in thousands, except share and per share data):
20232022
Numerator:
Net loss attributable to common stockholders$(77,578)$(77,969)
Denominator:
Weighted-average shares outstanding – basic and diluted159,958,645 152,676,155 
Net loss per share – basic and diluted$(0.48)$(0.51)
    
Due to the net losses for the years ended December 31, 2023 and 2022, basic and diluted net loss per common share were the same, as the effect of potentially dilutive securities would have been anti-dilutive.
The following outstanding balances of common share equivalent securities have been excluded from the calculation of diluted weighted-average common shares outstanding because the effect is anti-dilutive for the periods presented:
20232022
Stock options2,598,382 3,223,109 
RSUs13,162,368 6,346,955 
Warrants29,151,075 11,473,727 
Total44,911,825 21,043,791 
v3.24.0.1
Pay vs Performance Disclosure - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Pay vs Performance Disclosure    
Net loss $ (77,578) $ (77,969)
v3.24.0.1
Insider Trading Arrangements
 3 Months Ended
Dec. 31, 2023
Trading Arrangements, by Individual  
Rule 10b5-1 Arrangement Adopted false
Non-Rule 10b5-1 Arrangement Adopted false
Rule 10b5-1 Arrangement Terminated false
Non-Rule 10b5-1 Arrangement Terminated false
v3.24.0.1
SIGNIFICANT ACCOUNTING POLICIES (Policies)
 12 Months Ended
Dec. 31, 2023
Accounting Policies [Abstract]  
Basis of Presentation
Basis of Presentation—The accompanying consolidated financial statements include the accounts of the Company and its wholly owned subsidiary and have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”).
Risks and Uncertainties
Risks and Uncertainties—The Company is subject to a number of risks associated with companies of similar size in its industry, including, but not limited to, the need for successful development of products, the need for additional capital and financing to fund operations, competition from substitute products and services from larger companies, legal protection of proprietary technology, patent litigation, dependence on key individuals, and risks associated with changes in information technology.
Concentration of Credit Risk
Concentration of Credit Risk—Financial instruments that potentially subject the Company to concentration of credit risk consist of cash and cash equivalents and restricted cash. The Company’s cash and cash equivalents include cash in bank accounts, money market funds, and investments with a maturity of three months or less at the date of purchase. The Company’s restricted cash includes a certificate of deposit, collateral associated with a standby letter of credit, and a performance and payment bond. Deposits held with banks may exceed the amount of insurance provided on such deposits.
Segment Information
Segment Information—The Company has determined that its Chief Executive Officer (“CEO”) is its chief operating decision maker. The CEO reviews financial information for purposes of assessing performance and making decisions on how to allocate resources. The Company has determined that it operates in a single reportable segment.
Substantially all of the Company’s operations and long-lived assets were attributable to operations in the United States as of December 31, 2023 and 2022.
Use of Estimates
Use of Estimates—The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities and disclosure of commitments and contingencies as of the date of the financial statements and the reported amounts of expenses during the reporting periods. Such estimates relate to, but are not limited to, inventory valuation, product warranty liabilities, standalone selling prices, the fair value of the Company’s investments and warrant liabilities, the
useful lives and assessment of recoverability of property and equipment, deferred tax assets valuation, as well as other accruals. These estimates are based on historical trends, market pricing, current events and other relevant assumptions and data points. Actual results could differ from those estimates and such differences may be material to the financial statements.
Reclassifications
Reclassifications—Certain prior year amounts have been reclassified to conform with current year presentation. These reclassifications had no effect on the reported results of operations.
Restricted Cash
Restricted Cash—Restricted cash is required as collateral for certain of the Company’s lease agreements and contractual supply and service arrangements. Restricted cash includes a certificate of deposit for the Company’s lease agreements, collateral associated with a standby letter of credit issued to a customer, and a performance and payment bond for the Company’s supply and service arrangements. The certificate of deposit and bond are recorded at carrying value, which approximates fair value. Restricted cash amounts are reported in the consolidated balance sheets as current or non-current depending on when the cash will be contractually released.
Accounts Receivable, Net
Accounts Receivable, Net—The Company evaluates the creditworthiness of its customers. If the collection of any specific receivable is doubtful, an allowance is recorded in the allowance for expected credit losses which is included in accounts receivable, net in the consolidated balance sheets. The Company had no allowance for expected credit losses recorded at either December 31, 2023 or 2022.
Inventory
Inventory—As of the Transition Date, inventory consists of raw materials, work in progress, and finished goods, and is stated on a first-in, first-out basis at the lower of cost or net realizable value. Net realizable value is the estimated selling price of inventory in the ordinary course of business, less estimated costs of completion, disposal, and transportation. The Company periodically makes judgments and estimates regarding the future utility and carrying value of inventory. When inventory is adjusted to its net realizable value, a new cost basis is established and such cost is not adjusted for any potential recovery. Obsolete inventories are written off to cost of revenue. Should the Company’s estimates of future selling prices or production costs change, additional and potentially material write-downs may be required. A small change in the Company’s estimates may result in a material charge to its reported financial results.
Property and Equipment, Net
Property and Equipment, Net—Property and equipment are stated at cost, net of depreciation. Depreciation is provided using the straight-line method over the estimated useful lives of the assets, which range from three to seven years. Leasehold improvements are amortized over the lesser of the estimated useful lives of the assets or the remaining lease term. Expenditures for maintenance and repairs are expensed in the consolidated statements of operations and comprehensive loss as incurred. Expenditures which materially change capacities, or extend useful lives are capitalized. When assets are retired or disposed of, the cost and accumulated depreciation are removed from the accounts, and any resulting gains or losses are recognized in other income (expense), net in the consolidated statements of operations and comprehensive loss.
The Company evaluates the recoverability of property and equipment for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The Company assesses the alternative use of an asset, the condition of the asset and the current market demand to determine if an asset is impaired. No impairment loss was recognized during the years ended December 31, 2023 and 2022.
Intangible Assets, Net
Intangible Assets, Net—Intangible assets are stated at cost, net of accumulated amortization. Intangible assets are amortized on a straight-line basis over their expected useful lives.
Investments
Investments—Investments consist primarily of U.S. Treasury securities, U.S. agency securities, and commercial paper and are classified as trading securities as they are bought and held principally for the purpose of selling them in the near term. Trading securities are carried on the consolidated balance sheets at fair value. Unrealized gains and losses on trading securities are included in other income (expense), net in the consolidated statements of operations and comprehensive loss.
Revenue Recognition
Revenue Recognition—Revenue is primarily earned from the sale, installation and commissioning of energy storage systems and is derived from customer contracts. Revenue is recognized in an amount that reflects the consideration to which the Company expects to be entitled in exchange for transferring the promised goods and/or services to the customer, when or as the Company’s performance obligations are satisfied, which includes estimates for variable consideration (e.g., liquidated damages). For product sales of energy storage systems, the Company’s performance obligations are satisfied at the point in time when the customer obtains control of the system, based primarily on
shipping terms within individual customer contracts, unless specific customer acceptance criteria must be met, in which case revenue is deferred until customer acceptance has been received. No right of return exists on sales of energy storage systems.
Performance obligations for services, including the optional extended warranty and ongoing operations and maintenance program provided to customers, are satisfied over time as the respective services are performed.
The transaction price of the underlying customer agreement is allocated to each performance obligation based on its relative standalone selling price. When the standalone selling price is not directly observable, revenue is determined based on an estimate of selling price using the observable market price that the good or service sells for separately in similar circumstances and to similar customers, and/or an expected cost plus margin approach when the observable selling price of a good or services is not known and is either highly variable or uncertain.
The Company invoices customers in accordance with customer agreements, which in certain circumstances may be in advance of recognizing revenue if the Company has not satisfied the associated performance obligations. Payment terms generally include advance payments to reserve capacity and/or upon issuance of the customer’s purchase order with the remainder due upon the achievement of various milestones including but not limited to shipment readiness, delivery, commissioning of the system, and completion of final site testing. Advanced customer payments and unsatisfied performance obligations are recognized as deferred revenue in the consolidated balance sheets.
Sales tax collected from customers is recorded on a net basis and therefore, not included in revenue. Sales tax is recorded as a liability until remitted to governmental authorities. Shipping and handling, freight costs and other reimbursable costs are accounted for as fulfillment activities and included in revenue.
Cost of Revenue
Cost of Revenue—As of the Transition Date, cost of revenue includes the cost of the energy storage systems delivered, installed and commissioned during the year. It includes direct and indirect materials, labor costs, manufacturing overhead, including depreciation costs of tooling and machinery, adjustments to warranty expense, LCNRV charges, unfulfilled noncancellable purchase commitment expense, shipping and logistics costs, and provisions for excess and obsolete inventory. Additionally, cost of revenue benefits from production credits earned.
Product Warranties
Product Warranties—Warranty obligations are incurred in connection with the sale of the Company’s products. The Company generally provides a standard warranty for a period of one year and an optional extended warranty. The standard warranty is accounted for as an assurance-type warranty, which provides customers with assurance that the product complies with agreed-upon specifications and does not represent a separate performance obligation. The extended warranty is considered a service-type warranty which is a distinct service and a portion of the transaction price is allocated to that performance obligation.
Costs to provide for standard warranty obligations are estimated and recorded as a liability at the time revenue is recognized on the sale of the energy storage system. Warranty reserves include management’s best estimate of the projected costs to repair or to replace any items under warranty, which is based on various factors, including the use of actual claim data to date. Initial accruals and adjustments to warranty reserves were recorded to research and development expenses when the Company was in the research and development phase and are now recorded to cost of revenue following the transition to commercial inventory accounting as of the Transition Date.
Sales and Marketing
Sales and Marketing—Sales and marketing expenses consist primarily of salaries, benefits and stock-based compensation for marketing and sales personnel and related support teams. To a lesser extent, sales and marketing expenses also include professional services costs, travel costs, and trade show sponsorships and participation. Advertising costs are expensed as incurred.
Research and Development
Research and Development—Research and development costs are expensed as incurred and, as of the Transition Date, consist of materials, supplies, personnel-related expenses, allocated facilities costs, consulting services and other direct expenses. Personnel-related expenses consist of salaries, benefits and stock-based compensation. Substantially all of the Company’s research and development expenses are related to improving existing products and developing new products and related technologies. Prior to the Transition Date, research and development costs also included direct product development material costs, including freight charges, and product development personnel-related expenses, warranty-related costs, depreciation charges, overhead related costs, consulting services, and other direct expenses.
The Company receives funding from federal agencies for research and development activities related to its products. Under certain circumstances, up to the entire amount of funding may need to be repaid to the grantor in the form of a success fee in future periods if the Company monetized the results of the activities funded by the grantor. The portion of such funding the Company may be required to pay in certain circumstances is recorded in accrued and other current liabilities in the consolidated balance sheets and was $452 thousand as of December 31, 2022.
General and Administrative
General and Administrative—General and administrative expenses consist of personnel-related expenses for the Company’s corporate, executive, finance, legal, and other administrative functions, as well as expenses for outside professional services and insurance costs. Personnel-related expenses consist of salaries, benefits and stock-based compensation. To a lesser extent, general and administrative expenses include depreciation and other allocated costs, such as facility-related expenses and supplies.
Stock-Based Compensation
Stock-Based Compensation— The Company measures and recognizes compensation expense for all stock-based awards based on estimated fair values on the date of the grant, recognized over the requisite service period. For awards that vest solely based on a service condition, the Company recognizes stock-based compensation expense on a straight-line basis over the requisite service period. The compensation expense related to stock-based awards with performance conditions is recognized over the requisite service period when achievement of the performance conditions is probable. The compensation expense related to stock-based awards with market conditions is recognized on an accelerated attribution basis over the requisite service period identified as the derived service period over which the market conditions are expected to be achieved, and is not reversed if the market condition is not satisfied. The Company accounts for forfeitures as they occur. Stock-based awards granted to employees are primarily stock options and RSUs.
The fair value of each stock option granted is estimated using the Black-Scholes Merton option-pricing model using the single-option award approach. The following assumptions are used in the Black-Scholes Merton option-pricing model:
Risk-Free Interest Rate—The risk-free interest rate is based on the implied yield available on the date of grant on U.S. Treasury zero-coupon bonds issued with a term that is equal to the option’s expected term at the grant date.
Expected Volatility—The Company estimates the volatility for option grants by evaluating the average historical volatility of a peer group of companies for the period immediately preceding the option grant for a term that is approximately equal to the option’s expected term.
Expected Term—The expected term for employees represents the period over which options granted are expected to be outstanding using the simplified method, as the Company’s historical share option exercise experience does not provide a reasonable basis upon which to estimate the expected term. The simplified method deems the term to be the average of the time-to-vesting and contractual life of the stock-based awards.
Dividend Yield—The Company has not declared or paid dividends to date and does not anticipate declaring dividends. As such, the dividend yield has been estimated to be zero.
Income Taxes
Income Taxes—The Company accounts for income taxes under the asset and liability method. Under this method, deferred taxes are determined based on the temporary differences between the financial statement and tax bases of assets and liabilities using tax rates expected to be in effect during the years in which the bases differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in the consolidated statement of operations and comprehensive loss in the period that includes the enactment date.
ASC 740, Accounting for Income Taxes (“ASC 740”), requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on the Company’s ability to generate sufficient taxable income within the carryforward period. Because of the Company’s history of operating losses, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely and, accordingly, has provided a full valuation allowance for these tax benefits for the years ended December 31, 2023 and 2022.
The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax expense. No amounts were accrued for the payment of interest and penalties as of December 31, 2023 and 2022. The Company is currently not aware of any issues under review that could result in significant payments, accruals, or material deviation from its position.
Net Loss Per Share
Net Loss Per Share—The Company will use the two-class method when computing net loss per common share when shares are issued that meet the definition of participating securities. Under this method, net earnings are reduced by the amount of dividends declared in the current period for common stockholders and participating security holders. The remaining earnings or “undistributed earnings” are allocated between common stock and participating securities to the extent that each security may share in earnings as if all the earnings for the period had been distributed. Once calculated, the earnings per common share is computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding during each year presented. Diluted loss attributable to common stockholders per common share has been computed by dividing the net loss attributable to common stockholders by the weighted average number of common shares outstanding plus the dilutive effect of outstanding
options, warrants, and restricted stock units (“RSUs”) during the respective periods. In cases where the Company has a net loss, no dilutive effect is shown as options, warrants, and RSUs become anti-dilutive.
Fair Value
Fair Value—The Company follows ASC 820, Fair Value Measurements (“ASC 820”), which establishes a common definition of fair value to be applied when U.S. GAAP requires the use of fair value, establishes a framework for measuring fair value, and requires certain disclosures about such fair value measurements.
ASC 820 establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about what market participants would use in pricing the asset or liability based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the reliability of inputs as follows:
Level 1: Observable inputs such as quoted prices in active markets for identical assets or liabilities to which the Company has access at a measurement date.
Level 2: Observable inputs other than Level 1 quoted prices that are observable for the asset or liability, either directly or indirectly; these include quoted prices for similar assets or liabilities in an active market, quoted prices for identical assets and 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.
Level 3: Unobservable inputs for which little or no market data exists and for which the Company must develop its own assumptions regarding the assumptions that market participants would use in pricing the asset or liability, including assumptions regarding risk.
Because of the uncertainties inherent in the valuation of assets or liabilities for which there are no observable inputs, those estimated fair values may differ significantly from the values that may have been used had a ready market for the assets or liabilities existed.
Cash and Cash Equivalents Cash and Cash Equivalents—Cash and cash equivalents include cash in bank accounts, money market funds, and investments with a maturity of three months or less at the date of purchase. Cash equivalents are recorded at carrying value, which approximates fair value.
Emerging Growth Company
Emerging Growth Company—Pursuant to the JOBS Act of 2012, Section 102(b)(1), an emerging growth company is provided the option to adopt new or revised accounting standards that may be issued by the FASB or the SEC either (i) within the same periods as those otherwise applicable to non-emerging growth companies or (ii) within the same time periods as private companies. The Company has elected to use the extended transition period for complying with any new or revised financial accounting standards. As a result, the Company’s consolidated financial statements may not be comparable to the financial statements of issuers who are required to comply with the effective date for new or revised accounting standards that are applicable to public companies. The Company also intends to continue to take advantage of some of the reduced regulatory and reporting requirements of emerging growth companies pursuant to the JOBS Act so long as the Company qualifies as an emerging growth company.
Recent Accounting Pronouncements and Recently Adopted Accounting Pronouncements
Recent Accounting Pronouncements—In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. This ASU updates reportable segment disclosure requirements, primarily through enhanced disclosures about significant expenses. The ASU requires disclosures to include significant segment expenses that are regularly provided to the chief operating decision maker, a description of other segment items by reportable segment, and any additional measures of a segment's profit or loss used by the chief operating decision maker when deciding how to allocate resources. The ASU also requires all annual disclosures currently required by Topic 280 to be included in interim periods. The update is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted and requires retrospective application to all prior periods presented in the financial statements. The Company is currently evaluating the effect that the adoption of this ASU may have on the Company’s disclosures.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The ASU requires greater disaggregation of income tax disclosures primarily on the income tax rate reconciliation and income taxes paid. This authoritative guidance will be effective for the Company starting in fiscal year ending December 31, 2025, with early adoption permitted. The Company is currently evaluating the effect of this new standard on the Company's disclosures.
Recently Adopted Accounting Pronouncements—On January 1, 2023, the Company adopted ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which requires the measurement and recognition of expected credit losses for financial assets held at amortized cost. ASU 2016-13 replaces the existing incurred loss impairment model with a forward-looking expected credit loss model, which will result in earlier recognition of credit losses. The adoption did not result in a material impact to the Company’s consolidated financial statements or related disclosures. In future periods, as
revenue and accounts receivable increase, ASU 2016-13 could have a material impact on its consolidated financial statements.
v3.24.0.1
INVENTORY (Tables)
 12 Months Ended
Dec. 31, 2023
Inventory Disclosure [Abstract]  
Schedule of Inventory
Inventory consists of the following (in thousands):
December 31, 2023December 31, 2022
Raw materials$7,740 $— 
Work in process1,236 — 
Finished goods5,685 — 
Inventory, gross$14,661 $— 
Net realizable value adjustment(11,295)— 
Inventory$3,366 $— 
v3.24.0.1
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables)
 12 Months Ended
Dec. 31, 2023
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]  
Schedule of Prepaid Expenses and Other Current Assets
Prepaid expenses and other current assets consist of the following (in thousands):
December 31, 2023December 31, 2022
Insurance$521 $2,033 
Vendor advances936 3,147 
Grants receivable824 — 
IT related401 390 
Contract assets253 — 
Other370 87 
Total prepaid expenses and other current assets$3,305 $5,657 
v3.24.0.1
PROPERTY AND EQUIPMENT, NET (Tables)
 12 Months Ended
Dec. 31, 2023
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment, net
Property and equipment, net consist of the following (in thousands):
December 31, 2023December 31, 2022
Machinery and equipment$17,669 $13,699 
Furniture and fixtures184 184 
Leasehold improvements3,232 3,115 
Software183 183 
Construction in process4,279 3,230 
Total property and equipment25,547 20,411 
Less: accumulated depreciation(9,281)(2,841)
Total property and equipment, net$16,266 $17,570 
v3.24.0.1
INTANGIBLE ASSETS, NET (Tables)
 12 Months Ended
Dec. 31, 2023
Goodwill and Intangible Assets Disclosure [Abstract]  
Schedule of Intangible Assets, Net
Intangible assets, net, consisted of the following (in thousands):
December 31, 2023December 31, 2022
Patents$4,990 $— 
Less: accumulated depreciation(67)— 
Intangible assets, net$4,923 $— 
Schedule of Intangible Assets, Estimated Future Amortization Expense
Estimated future amortization expense of intangible assets as of December 31, 2023 are as follows (in thousands):
2024$267 
2025267 
2026267 
2027267 
2028267 
Thereafter3,588 
Total future amortization$4,923 
v3.24.0.1
ACCRUED AND OTHER CURRENT LIABILITIES (Tables)
 12 Months Ended
Dec. 31, 2023
Payables and Accruals [Abstract]  
Schedule of Accrued and Other Current Liabilities
Accrued and other current liabilities consist of the following (in thousands):
December 31, 2023December 31, 2022
Payroll and related benefits$5,681 $2,948 
Materials and related purchases2,083 6,892 
Professional and consulting fees802 1,011 
Amounts due to customers545 770 
Accrued capital purchases327 1,093 
Noncancellable purchase commitments637 — 
Other680 1,411 
Total accrued and other current liabilities$10,755 $14,125 
v3.24.0.1
ACCRUED PRODUCT WARRANTIES (Tables)
 12 Months Ended
Dec. 31, 2023
Guarantees and Product Warranties [Abstract]  
Schedule of Product Warranty Activity
The following table summarizes product warranty activity (in thousands):
Year Ended December 31,
20232022
Accrued product warranties - beginning of period$1,643 $— 
Accruals for warranties issued3,412 2,612 
Repairs and replacements(1,416)(969)
Adjustments to existing accruals(1,510)— 
Accrued product warranties - end of period$2,129 $1,643 
v3.24.0.1
LEASES (Tables)
 12 Months Ended
Dec. 31, 2023
Leases [Abstract]  
Schedule of Operating Lease Liability Maturities
As of December 31, 2023, future maturities of lease liabilities are as follows (in thousands):
Operating Leases
2024$1,720 
2025983 
Thereafter— 
Total minimum lease payments$2,703 
Less: imputed interest(165)
Present value of lease liabilities$2,538 
Schedule of Lease Costs
Weighted-average remaining lease term and discount rate are as follows:
December 31, 2023December 31, 2022
Weighted-average remaining lease term (in years)1.72.6
Weighted-average discount rate7.5 %7.5 %
v3.24.0.1
BORROWINGS (Tables)
 12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
Schedule of Borrowings
Borrowings consist of the following (in thousands):
December 31, 2023December 31, 2022
Total notes payable$— $1,915 
Less current portion of notes payable— 1,600 
Notes payable, non-current$— $315 
v3.24.0.1
COMMON STOCK WARRANTS (Tables)
 12 Months Ended
Dec. 31, 2023
Equity [Abstract]  
Schedule of Common Stock Warrant Activity
Common stock warrant balances consist of the following:
December 31, 2023December 31, 2022
Public Warrants outstanding11,461,227 7,377,893 
Private Warrants outstanding:
Other Private Warrants outstanding— 3,500,000 
Earnout Warrants outstanding— 583,334 
SMUD Warrant outstanding12,500 12,500 
Honeywell Warrants outstanding:
Investment Warrant outstanding10,631,633 — 
IP Warrant outstanding6,269,955 — 
Performance Warrants outstanding775,760 — 
Total common stock warrants29,151,07511,473,727
The table below shows the common stock warrant activities during the year ended December 31, 2023:
December 31, 2022IssuedExercised
Converted(1)
December 31, 2023
Earnout Warrants583,334 — — (583,334)— 
Private Warrants (excluding Earnout Warrants)3,500,000 — — (3,500,000)— 
Public Warrants7,377,893 — — 4,083,334 11,461,227 
SMUD Warrant12,500 — — — 12,500 
Investment Warrant— 10,631,633 — — 10,631,633 
IP Warrant— 6,269,955 — — 6,269,955 
Performance Warrants— 775,760 — — 775,760 
Total common stock warrants11,473,727 17,677,348 — — 29,151,075
(1) In accordance with the terms of the Warrant Agreement, dated September 16, 2020, by and between STWO and Continental Stock Transfer & Trust Company (“Continental”), as amended by the Assignment, Assumption and Agreement, dated October 8, 2021, by and among the Company, STWO, Continental and Computershare Trust Company, N.A. (as amended, the “Warrant Agreement”), the Private Warrants, including the Earnout Warrants, automatically converted on a 1:1 basis into Public Warrants upon the transfer of such warrants by the initial holder to a third party during the fourth quarter of 2023.
The table below shows the common stock warrant activities during the year ended December 31, 2022:
December 31, 2021IssuedExercisedDecember 31, 2022
Earnout Warrants583,334 — — 583,334
Private Warrants (excluding Earnout Warrants)3,500,000 — — 3,500,000
Public Warrants7,377,913 — 207,377,893
SMUD Warrant— 12,500 — 12,500
Total common stock warrants11,461,247 12,5002011,473,727
v3.24.0.1
STOCK-BASED COMPENSATION (Tables)
 12 Months Ended
Dec. 31, 2023
Share-Based Payment Arrangement [Abstract]  
Schedule of Stock-Based Compensation The following table presents the amount of stock-based compensation related to stock-based awards issued to employees on the Company’s consolidated statements of operations and comprehensive loss during the years ended December 31, 2023 and 2022 (in thousands):
20232022
Cost of revenue$1,753 $— 
Research and development2,696 2,856 
Sales and marketing816 456 
General and administrative5,370 8,577 
Total stock-based compensation$10,635 $11,889 
Schedule of Share-based Payment Arrangement, Option, Activity
Stock option and RSU activity, prices, and values during the years ended December 31, 2023 and 2022 are as follows (in thousands, except for share, per share, and contractual term data):
Options OutstandingRSUs
Number of
shares		Weighted
average
exercise price		Weighted
average
remaining
 contractual
term
(years)		Aggregate
intrinsic
values
($’000s)		Number of plan shares outstandingWeighted average
grant date fair value
per Share
Balances as of December 31, 2022
3,223,109 $1.01 7.39$4,583 6,346,955 $6.10 
Options and RSUs granted378,110 1.51 11,581,684 1.21 
Options exercised and RSUs released(703,550)0.34 (2,892,339)3.42 
Options and RSUs forfeited(299,287)0.46 (1,873,932)3.31 
Balances as of December 31, 2023
2,598,382 $1.33 6.25$1,422 13,162,368 $2.79 
Options vested and exercisable - December 31, 2022
1,947,123 $0.76 7.06$3,244 
Options vested and exercisable - December 31, 2023
1,775,256 $1.10 5.62$1,198 
Schedule of Share-based Payment Arrangement, Restricted Stock Unit, Activity
Stock option and RSU activity, prices, and values during the years ended December 31, 2023 and 2022 are as follows (in thousands, except for share, per share, and contractual term data):
Options OutstandingRSUs
Number of
shares		Weighted
average
exercise price		Weighted
average
remaining
 contractual
term
(years)		Aggregate
intrinsic
values
($’000s)		Number of plan shares outstandingWeighted average
grant date fair value
per Share
Balances as of December 31, 2022
3,223,109 $1.01 7.39$4,583 6,346,955 $6.10 
Options and RSUs granted378,110 1.51 11,581,684 1.21 
Options exercised and RSUs released(703,550)0.34 (2,892,339)3.42 
Options and RSUs forfeited(299,287)0.46 (1,873,932)3.31 
Balances as of December 31, 2023
2,598,382 $1.33 6.25$1,422 13,162,368 $2.79 
Options vested and exercisable - December 31, 2022
1,947,123 $0.76 7.06$3,244 
Options vested and exercisable - December 31, 2023
1,775,256 $1.10 5.62$1,198 
Schedule of Valuation Assumptions
In accordance with ASC 718, the fair value of each option grant has been estimated as of the date of grant using the following weighted average assumptions:
20232022
Risk-free rate4.38 %1.64 %
Expected volatility87.08 %73.95 %
Expected term6 years6 years
Expected dividends— — 
v3.24.0.1
FAIR VALUE MEASUREMENTS (Tables)
 12 Months Ended
Dec. 31, 2023
Fair Value Disclosures [Abstract]  
Schedule of Fair Value Assets and Liabilities Measured on Recurring Basis
The following tables present the Company’s fair value hierarchy for its financial assets measured at fair value on a recurring basis (in thousands):
December 31, 2023
Cash Equivalents and Restricted CashShort-Term InvestmentsTotal Assets at Fair Value
Level 1:
Money market funds$10,126 $— $10,126 
U.S. Treasury securities— 54,681 54,681 
Total Level 110,126 54,681 64,807 
Level 2:
Certificate of deposit77 — 77 
U.S. agency securities— 12,447 12,447 
Commercial paper9,353 20,771 30,124 
Total Level 29,430 33,218 42,648 
Total assets measured at fair value$19,556 $87,899 $107,455 
December 31, 2022
Cash Equivalents and Restricted CashShort-Term InvestmentsTotal Assets at Fair Value
Level 1:
Money market funds$27,993 $— $27,993 
U.S. Treasury securities— 19,944 19,944 
Total Level 127,993 19,944 47,937 
Level 2:
Certificate of deposit75 — 75 
U.S. agency securities— 55,319 55,319 
Commercial paper5,972 29,784 35,756 
Total Level 26,047 85,103 91,150 
Total assets measured at fair value$34,040 $105,047 $139,087 
The following tables present the Company’s fair value hierarchy for its financial liabilities measured at fair value on a recurring basis (in thousands):
December 31, 2023
Level 1Level 2Level 3Total
Liabilities:
Public common stock warrants917 — — 917 
Total liabilities measured at fair value$917 $— $— $917 
December 31, 2022
Level 1Level 2Level 3Total
Liabilities:
Earnout warrant liabilities$— $163 $— $163 
Public common stock warrants2,066 — — 2,066 
Private common stock warrants— 980 — 980 
Total liabilities measured at fair value$2,066 $1,143 $— $3,209 
v3.24.0.1
INCOME TAXES (Tables)
 12 Months Ended
Dec. 31, 2023
Income Tax Disclosure [Abstract]  
Schedule of Deferred Tax Assets and Liabilities The significant components of deferred tax assets and liabilities are as follows (in thousands):
As of December 31,
20232022
Deferred tax assets:
Net operating losses$46,616 $34,454 
Tax credit carryforward1,454 909 
Equity compensation1,560 737 
Capitalized research and development expenses19,644 16,946 
Inventory reserve3,159 — 
Deferred revenue1,002 — 
Other2,761 2,153 
Total deferred tax assets76,196 55,199 
Valuation allowance(75,590)(54,261)
Deferred tax assets, net of valuation allowance606 938 
Deferred tax liabilities:
Right-of-use assets(606)(938)
Net deferred tax$— $— 
Schedule of Provision for Income Taxes
The effective tax rate of the Company’s provision for income taxes differs from the federal statutory rate as follows:
Years Ended December 31,
20232022
Federal statutory tax rate21.0 %21.0 %
State tax, net of federal tax benefit6.8 7.2 
Stock compensation(1.9)(0.2)
Non-deductible officer compensation0.8 (1.4)
Warrant liabilities revaluation0.6 6.6 
Earnout Shares liabilities revaluation— 0.4 
Permanent differences(0.1)0.1 
Research and development tax credits0.5 0.8 
Other(0.1)0.1 
Valuation allowance(27.6)(34.6)
Effective tax rate— %— %
Schedule of Uncertain Tax Positions
The changes in the Company's uncertain tax positions are summarized as follows (in thousands):
Balance as of December 31, 2021
$292 
Additions related to prior year— 
Additions related to current year613 
Balance as of December 31, 2022
905 
Additions related to prior year170 
Additions related to current year382 
Balance as of December 31, 2023
$1,457 
v3.24.0.1
REVENUE (Tables)
 12 Months Ended
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]  
Schedule of Revenue Disaggregated by Source
The following table presents the Company’s revenue, disaggregated by source (in thousands):
Year Ended December 31,
20232022
Product revenue$5,103 $803 
Service revenue183 91 
Other revenue2,254 — 
Total revenue$7,540 $894 
Schedule of Deferred Revenue
The following table provides information about contract assets and deferred revenue from contracts with customers (in thousands):
December 31, 2023December 31, 2022
Contract assets$253 11 
Deferred revenue20,781 8,610 
v3.24.0.1
NET LOSS PER SHARE (Tables)
 12 Months Ended
Dec. 31, 2023
Earnings Per Share [Abstract]  
Schedule of Basic and Diluted Net Loss per Share Attributable to Common Shareholders
The following table presents the calculation of basic and diluted net loss per share attributable to common stockholders for the years ended December 31, 2023 and 2022 (in thousands, except share and per share data):
20232022
Numerator:
Net loss attributable to common stockholders$(77,578)$(77,969)
Denominator:
Weighted-average shares outstanding – basic and diluted159,958,645 152,676,155 
Net loss per share – basic and diluted$(0.48)$(0.51)
Schedule of Securities Excluded from Calculation of Diluted Weighted-Average Common Shares Outstanding
The following outstanding balances of common share equivalent securities have been excluded from the calculation of diluted weighted-average common shares outstanding because the effect is anti-dilutive for the periods presented:
20232022
Stock options2,598,382 3,223,109 
RSUs13,162,368 6,346,955 
Warrants29,151,075 11,473,727 
Total44,911,825 21,043,791 
v3.24.0.1
DESCRITPION OF BUSINESS, BASIS OF PRESENTATION AND RISKS AND UNCERTAINTIES (Details)
 12 Months Ended
Dec. 31, 2023
h
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Battery, flexible energy capacity, minimum 4
v3.24.0.1
SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Significant Accounting Policies [Line Items]    
Impairment recognized $ 0 $ 0
Research and development grant refund liability   452,000
Accrued interest and penalties related to uncertain tax positions $ 0 $ 0
Stock options    
Significant Accounting Policies [Line Items]    
Expected dividends 0.00% 0.00%
Minimum    
Significant Accounting Policies [Line Items]    
Estimated useful live of assets 3 years  
Maximum    
Significant Accounting Policies [Line Items]    
Estimated useful live of assets 7 years  
v3.24.0.1
INVENTORY - Schedule of Inventory (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Inventory Disclosure [Abstract]    
Raw materials $ 7,740 $ 0
Work in process 1,236 0
Finished goods 5,685 0
Inventory, gross 14,661 0
Net realizable value adjustment (11,295) 0
Inventory $ 3,366 $ 0
v3.24.0.1
INVENTORY - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Inventory Disclosure [Abstract]    
Charge to reflect the LCNRV of inventory $ 11,300,000 $ 0
Firm purchase commitment loss $ 637,000  
v3.24.0.1
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]    
Insurance $ 521 $ 2,033
Vendor advances 936 3,147
Grants receivable 824 0
IT related 401 390
Contract assets 253 0
Other 370 87
Total prepaid expenses and other current assets $ 3,305 $ 5,657
v3.24.0.1
PROPERTY AND EQUIPMENT, NET (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Property, Plant and Equipment [Line Items]    
Total property and equipment $ 25,547 $ 20,411
Less: accumulated depreciation (9,281) (2,841)
Total property and equipment, net 16,266 17,570
Depreciation expense 6,400 1,500
Machinery and equipment    
Property, Plant and Equipment [Line Items]    
Total property and equipment 17,669 13,699
Furniture and fixtures    
Property, Plant and Equipment [Line Items]    
Total property and equipment 184 184
Leasehold improvements    
Property, Plant and Equipment [Line Items]    
Total property and equipment 3,232 3,115
Software    
Property, Plant and Equipment [Line Items]    
Total property and equipment 183 183
Construction in process    
Property, Plant and Equipment [Line Items]    
Total property and equipment $ 4,279 $ 3,230
v3.24.0.1
INTANGIBLE ASSETS, NET - Narrative (Details) - USD ($)
$ in Thousands
 1 Months Ended 12 Months Ended
Sep. 30, 2023
Dec. 31, 2023
Finite-Lived Intangible Assets [Line Items]    
Amortization expense   $ 67
Patents    
Finite-Lived Intangible Assets [Line Items]    
Finite-lived intangible assets acquired $ 5,000  
Intangible asset, useful life (in years)   19 years
v3.24.0.1
INTANGIBLE ASSETS, NET - Schedule of Intangible Assets, Net (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Finite-Lived Intangible Assets [Line Items]    
Less: accumulated depreciation $ (67) $ 0
Intangible assets, net 4,923 0
Patents    
Finite-Lived Intangible Assets [Line Items]    
Patents $ 4,990 $ 0
v3.24.0.1
INTANGIBLE ASSETS, NET - Schedule of Intangible Assets, Estimated Future Amortization Expense (Details)
$ in Thousands
Dec. 31, 2023
USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]  
2024 $ 267
2025 267
2026 267
2027 267
2028 267
Thereafter 3,588
Total future amortization $ 4,923
v3.24.0.1
ACCRUED AND OTHER CURRENT LIABILITIES (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Payables and Accruals [Abstract]    
Payroll and related benefits $ 5,681 $ 2,948
Materials and related purchases 2,083 6,892
Professional and consulting fees 802 1,011
Amounts due to customers 545 770
Accrued capital purchases 327 1,093
Noncancellable purchase commitments 637 0
Other 680 1,411
Total accrued and other current liabilities $ 10,755 $ 14,125
v3.24.0.1
ACCRUED PRODUCT WARRANTIES (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Movement in Standard Product Warranty Accrual [Roll Forward]    
Product warranties at beginning of period $ 1,643 $ 0
Accruals for warranties issued 3,412 2,612
Repairs and replacements (1,416) (969)
Adjustments to existing accruals (1,510) 0
Product warranties at end of period $ 2,129 $ 1,643
v3.24.0.1
LEASES - Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Leases [Abstract]    
Renewal term 60 months  
Operating lease cost $ 1,500 $ 1,500
v3.24.0.1
LEASES - Maturities of Operating and Financing Lease Liabilities (Details)
$ in Thousands
Dec. 31, 2023
USD ($)
Operating Leases  
2024 $ 1,720
2025 983
Thereafter 0
Total minimum lease payments 2,703
Less: imputed interest (165)
Present value of lease liabilities $ 2,538
v3.24.0.1
LEASES - Lease Term and Discount Rate (Details)
Dec. 31, 2023
Dec. 31, 2022
Leases [Abstract]    
Weighted-average remaining lease term (in years) 1 year 8 months 12 days 2 years 7 months 6 days
Weighted-average discount rate 7.50% 7.50%
v3.24.0.1
BORROWINGS - Schedule of Borrowings (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Debt Disclosure [Abstract]    
Total notes payable $ 0 $ 1,915
Less current portion of notes payable 0 1,600
Notes payable, non-current $ 0 $ 315
v3.24.0.1
BORROWINGS - Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Jul. 07, 2023
Dec. 31, 2022
Dec. 31, 2023
Debt Instrument [Line Items]      
Total notes payable   $ 1,915 $ 0
First Citizens Bank      
Debt Instrument [Line Items]      
Repay of outstanding notes payable $ 1,000    
Final payment due $ 200    
Notes payable      
Debt Instrument [Line Items]      
Total notes payable   $ 1,900  
Notes payable | Prime      
Debt Instrument [Line Items]      
Spread on interest rate   0.50%  
v3.24.0.1
COMMITMENTS AND CONTINGENCIES (Details) - USD ($)
 1 Months Ended 12 Months Ended
Sep. 30, 2023
Dec. 31, 2023
Dec. 31, 2022
Mar. 09, 2023
Sep. 01, 2022
Other Commitments [Line Items]          
Restricted certificate of deposit     $ 75,000    
Research and development   $ 42,632,000 71,979,000    
UOP | Joint Development Agreement          
Other Commitments [Line Items]          
Research and development $ 8,000,000        
Noncancellable agreement          
Other Commitments [Line Items]          
Noncancelable purchase commitments   637,000 1,600,000    
Cancellable agreement          
Other Commitments [Line Items]          
Noncancelable purchase commitments   7,700,000 14,900,000    
Letter of credit | First Republic Bank          
Other Commitments [Line Items]          
Standby letter of credit     725,000    
Draws against letter of credit   0 $ 0    
Letter of credit | CitiBank N.A          
Other Commitments [Line Items]          
Standby letter of credit         $ 600,000
Draws against letter of credit   0      
Letter of credit | CitiBank N.A | Asset pledged as collateral          
Other Commitments [Line Items]          
Amounts pledged as collateral   600,000      
Letter of credit | First Citizens BancShares          
Other Commitments [Line Items]          
Standby letter of credit       $ 200,000  
Draws against letter of credit   0      
Letter of credit | First Citizens BancShares | Asset pledged as collateral          
Other Commitments [Line Items]          
Amounts pledged as collateral   $ 200,000      
v3.24.0.1
COMMON STOCK WARRANTS - Schedule of Common Stock Warrant Balances (Details)
 12 Months Ended
Dec. 31, 2023
shares
Dec. 31, 2022
shares
Dec. 31, 2021
shares
Oct. 08, 2021
shares
Class of Warrant or Right [Line Items]        
Warrants (in shares) 29,151,075 11,473,727 11,461,247  
Stock split, conversion ratio 1      
Public common stock warrants        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 11,461,227 7,377,893 7,377,913  
Private common stock warrants        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 0 3,500,000 3,500,000 4,083,334
Earnout Warrants        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 0 583,334 583,334  
SMUD Warrant outstanding        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 12,500 12,500 0  
Investment Warrant outstanding        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 10,631,633 0    
IP Warrant outstanding        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 6,269,955 0    
Performance Warrants outstanding        
Class of Warrant or Right [Line Items]        
Warrants (in shares) 775,760 0    
v3.24.0.1
COMMON STOCK WARRANTS - Narrative (Details)
$ / shares in Units, $ in Thousands
 12 Months Ended
Sep. 21, 2023
USD ($)
tradingDay
$ / shares
shares
Oct. 08, 2021
shares
Sep. 21, 2020
$ / shares
shares
Dec. 31, 2023
USD ($)
$ / shares
shares
Dec. 31, 2022
USD ($)
shares
Sep. 16, 2022
$ / shares
shares
Dec. 31, 2021
shares
Nov. 09, 2021
shares
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares)       29,151,075 11,473,727   11,461,247  
Warrants issued (in shares)       17,677,348 12,500      
Net decrease (increase) to warrant liabilities | $       $ (2,292) $ (25,788)      
Number of shares with vesting conditions met (in shares)       12,500        
Proceeds from issuance of common stock and common stock warrants, net of issuance costs | $       $ 27,132 $ 0      
Redemption two                
Class of Warrant or Right [Line Items]                
Price of common stock triggering redemption of warrants (in USD per share) | $ / shares       $ 10.00        
Trading days triggering redemption of warrants       20 days        
Consecutive trading day period       30 days        
Common Stock | STWO                
Class of Warrant or Right [Line Items]                
Price per share (in USD per share) | $ / shares     $ 11.50          
Common Stock | Public Warrant Holders | STWO                
Class of Warrant or Right [Line Items]                
Issuance of shares (in shares)     1          
Private common stock warrants | Private Placement | STWO | STWO's Sponsor                
Class of Warrant or Right [Line Items]                
Shares issued (in shares)     4,666,667          
Public common stock warrants                
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares)       11,461,227 7,377,893   7,377,913  
Warrants issued (in shares)       0 0      
Public common stock warrants | STWO                
Class of Warrant or Right [Line Items]                
Warrants issued (in shares)   8,333,287            
Warrants term     5 years          
Public common stock warrants | Redemption one                
Class of Warrant or Right [Line Items]                
Redemption price per share (in USD per share) | $ / shares       $ 0.01        
Price of common stock triggering redemption of warrants (in USD per share) | $ / shares       $ 18.00        
Trading days triggering redemption of warrants       20 days        
Consecutive trading day period       30 days        
Public common stock warrants | Redemption two                
Class of Warrant or Right [Line Items]                
Redemption price per share (in USD per share) | $ / shares       $ 0.10        
Private common stock warrants                
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares)   4,083,334   0 3,500,000   3,500,000  
Warrants issued (in shares)       0 0      
Warrants vested (in shares)   3,500,000            
Private common stock warrants | STWO's Sponsor                
Class of Warrant or Right [Line Items]                
Warrants forfeited (in shares)   583,333            
Earnout Warrants                
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares)       0 583,334   583,334  
Warrants issued (in shares)       0 0      
Warrants vested (in shares)               583,334
Net decrease (increase) to warrant liabilities | $       $ 2,300 $ 25,800      
SMUD Warrant outstanding                
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares)       12,500 12,500   0  
Warrants issued (in shares)       0 12,500      
Class of warrant or right, number of securities called by each warrant or right (in shares)           500,000    
Class of warrant or right, exercise price of warrants or rights (in dollars per share) | $ / shares           $ 4.296    
Honeywell Warrants                
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares) 6,269,955              
Shares issued (in shares) 16,491,754              
Proceeds from issuance of common stock and common stock warrants, net of issuance costs | $ $ 27,500              
Honeywell Warrants | Investment Warrant outstanding                
Class of Warrant or Right [Line Items]                
Warrants outstanding (in shares) 10,631,633              
Class of warrant or right, exercise price of warrants or rights (in dollars per share) | $ / shares $ 1.89              
Honeywell Warrants | IP Warrant outstanding                
Class of Warrant or Right [Line Items]                
Class of warrant or right, exercise price of warrants or rights (in dollars per share) | $ / shares $ 2.90              
Performance Warrant                
Class of Warrant or Right [Line Items]                
Warrants term 5 years              
Class of warrant or right, exercise price of warrants or rights (in dollars per share) | $ / shares $ 1.45              
Proceeds from issuance of common stock and common stock warrants, net of issuance costs | $ $ 300,000              
Additional performance warrants | $ $ 15,000              
Number of trading days | tradingDay 15              
Performance Warrant | UOP LLC                
Class of Warrant or Right [Line Items]                
Warrants term 5 years              
Class of warrant or right, number of securities called by each warrant or right (in shares) 775,760              
Exchange for pre-payment of equipment | $ $ 15,000              
v3.24.0.1
COMMON STOCK WARRANTS - Schedule of Common Stock Warrant Activity (Details) - shares
 12 Months Ended
Oct. 08, 2021
Dec. 31, 2023
Dec. 31, 2022
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   11,473,727 11,461,247
Warrants issued (in shares)   17,677,348 12,500
Warrants exercised (in shares)   0 20
Warrants exercised converted, (in shares)   0  
Warrants or rights at end of period (in shares)   29,151,075 11,473,727
Earnout Warrants      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   583,334 583,334
Warrants issued (in shares)   0 0
Warrants exercised (in shares)   0 0
Warrants exercised converted, (in shares)   (583,334)  
Warrants or rights at end of period (in shares)   0 583,334
Private Warrants (excluding Earnout Warrants)      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   3,500,000 3,500,000
Warrants issued (in shares)   0 0
Warrants exercised (in shares)   0 0
Warrants exercised converted, (in shares)   (3,500,000)  
Warrants or rights at end of period (in shares) 4,083,334 0 3,500,000
Public Warrants      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   7,377,893 7,377,913
Warrants issued (in shares)   0 0
Warrants exercised (in shares)   0 20
Warrants exercised converted, (in shares)   4,083,334  
Warrants or rights at end of period (in shares)   11,461,227 7,377,893
SMUD Warrant outstanding      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   12,500 0
Warrants issued (in shares)   0 12,500
Warrants exercised (in shares)   0 0
Warrants exercised converted, (in shares)   0  
Warrants or rights at end of period (in shares)   12,500 12,500
Investment Warrant outstanding      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   0  
Warrants issued (in shares)   10,631,633  
Warrants exercised (in shares)   0  
Warrants exercised converted, (in shares)   0  
Warrants or rights at end of period (in shares)   10,631,633 0
IP Warrant outstanding      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   0  
Warrants issued (in shares)   6,269,955  
Warrants exercised (in shares)   0  
Warrants exercised converted, (in shares)   0  
Warrants or rights at end of period (in shares)   6,269,955 0
Performance Warrants outstanding      
Class of Warrant or Right [Roll Forward]      
Warrants or rights at beginning of period (in shares)   0  
Warrants issued (in shares)   775,760  
Warrants exercised (in shares)   0  
Warrants exercised converted, (in shares)   0  
Warrants or rights at end of period (in shares)   775,760 0
v3.24.0.1
STOCK-BASED COMPENSATION - Schedule of Stock-Based Compensation (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Total stock-based compensation $ 10,635 $ 11,889
Cost of revenue    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Total stock-based compensation 1,753 0
Research and development    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Total stock-based compensation 2,696 2,856
Sales and marketing    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Total stock-based compensation 816 456
General and administrative    
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items]    
Total stock-based compensation $ 5,370 $ 8,577
v3.24.0.1
STOCK-BASED COMPENSATION - Narrative (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Jan. 01, 2022
Dec. 31, 2023
Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Percentage of potential increase of shares authorized   5.00%  
Aggregate intrinsic value of options exercised   $ 900 $ 2,100
Unamortized stock-based compensation costs   $ 26,000  
Weighted average period of recognition for unamortized stock-based compensation costs   2 years 9 months 3 days  
Total stock-based compensation   $ 10,635 $ 11,889
Tranche one      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Award vesting rights, percentage   25.00%  
Tranche two      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Award vesting rights, percentage   6.25%  
Stock options      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Weighted average estimated fair value of options granted using Black-Scholes options pricing model (in USD per share)   $ 1.13 $ 5.23
Employee stock      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Maximum employee stock purchase amount   $ 25  
ESPP purchase price of common stock, percent of market price   85.00%  
Total stock-based compensation   $ 324 $ 270
2021 Equity Incentive Plan      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Potential increase of shares authorized (in shares)   15,260,000  
Increase in shares authorized for issuance (in shares) 8,700,000    
Shares authorized for issuance (in shares)   26,310,000  
Shares available for future grant (in shares)   5,645,585  
2021 Equity Incentive Plan | Stock options      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Award vesting period   4 years  
Share expiration period   10 years  
2014 Equity Incentive Plan | Stock options      
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]      
Award vesting period   4 years  
v3.24.0.1
STOCK-BASED COMPENSATION - Schedule of Share-based Payment Arrangement, Option and RSU Activity (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Options Outstanding    
Options outstanding at beginning of period (in shares) 3,223,109  
Options granted (in shares) 378,110  
Options exercised (in shares) (703,550)  
Options forfeited (in shares) (299,287)  
Options outstanding at end of period (in shares) 2,598,382 3,223,109
Options vested and exercisable (in shares) 1,775,256 1,947,123
Weighted average exercise price    
Weighted average exercise price of options outstanding at beginning of period (in USD per share) $ 1.01  
Weighted average exercise price of options granted (in USD per share) 1.51  
Weighted average exercise price of options exercised (in USD per share) 0.34  
Weighted average exercise price of options forfeited (in USD per share) 0.46  
Weighted average exercise price of options outstanding at end of period (in USD per share) 1.33 $ 1.01
Weighted average exercise price of options vested and exercisable (in USD per share) $ 1.10 $ 0.76
Options, Additional Disclosures    
Weighted average remaining contractual term of options outstanding 6 years 3 months 7 years 4 months 20 days
Weighted average remaining contractual term of options vested and exercisable 5 years 7 months 13 days 7 years 21 days
Aggregate intrinsic value of options outstanding $ 1,422 $ 4,583
Aggregate intrinsic value of options vested and exercisable $ 1,198 $ 3,244
RSUs    
RSUs    
Units outstanding at beginning of period (in shares) 6,346,955  
Units granted (in shares) 11,581,684  
Units released (in shares) (2,892,339)  
Units forfeited (in shares) (1,873,932)  
Units outstanding at end of period (in shares) 13,162,368 6,346,955
Weighted average grant date fair value per Share    
Weighted average grant date fair value per share of units outstanding at beginning of period (in USD per share) $ 6.10  
Weighted average grant date fair value per share of units granted (in USD per share) 1.21  
Weighted average grant date fair value per share of units exercised (in USD per share) 3.42  
Weighted average grant date fair value per share of units forfeited (in USD per share) 3.31  
Weighted average grant date fair value per share of units outstanding at end of period (in USD per share) $ 2.79 $ 6.10
v3.24.0.1
STOCK-BASED COMPENSATION - Schedule of Valuation Assumptions (Details) - Stock options
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]    
Risk-free rate 4.38% 1.64%
Expected volatility 87.08% 73.95%
Expected term 6 years 6 years
Expected dividends 0.00% 0.00%
v3.24.0.1
FAIR VALUE MEASUREMENTS - Schedule of Assets and Liabilities on Recurring Basis (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Assets, Fair Value Disclosure [Abstract]    
Short-Term Investments $ 87,899 $ 105,047
Fair value, recurring    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 19,556 34,040
Short-Term Investments 87,899 105,047
Total Assets at Fair Value 107,455 139,087
Liabilities, Fair Value Disclosure [Abstract]    
Earnout warrant liabilities   163
Total liabilities measured at fair value 917 3,209
Fair value, recurring | Public common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants 917 2,066
Fair value, recurring | Private common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants   980
Fair value, recurring | Level 1    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 10,126 27,993
Short-Term Investments 54,681 19,944
Total Assets at Fair Value 64,807 47,937
Liabilities, Fair Value Disclosure [Abstract]    
Earnout warrant liabilities   0
Total liabilities measured at fair value 917 2,066
Fair value, recurring | Level 1 | Public common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants 917 2,066
Fair value, recurring | Level 1 | Private common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants   0
Fair value, recurring | Level 1 | Money market funds    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 10,126 27,993
Short-Term Investments 0 0
Total Assets at Fair Value 10,126 27,993
Fair value, recurring | Level 1 | U.S. Treasury securities    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 0 0
Short-Term Investments 54,681 19,944
Total Assets at Fair Value 54,681 19,944
Fair value, recurring | Level 2    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 9,430 6,047
Short-Term Investments 33,218 85,103
Total Assets at Fair Value 42,648 91,150
Liabilities, Fair Value Disclosure [Abstract]    
Earnout warrant liabilities   163
Total liabilities measured at fair value 0 1,143
Fair value, recurring | Level 2 | Public common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants 0 0
Fair value, recurring | Level 2 | Private common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants   980
Fair value, recurring | Level 2 | Certificate of deposit    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 77 75
Short-Term Investments 0 0
Total Assets at Fair Value 77 75
Fair value, recurring | Level 2 | U.S. agency securities    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 0 0
Short-Term Investments 12,447 55,319
Total Assets at Fair Value 12,447 55,319
Fair value, recurring | Level 2 | Commercial paper    
Assets, Fair Value Disclosure [Abstract]    
Cash Equivalents and Restricted Cash 9,353 5,972
Short-Term Investments 20,771 29,784
Total Assets at Fair Value 30,124 35,756
Fair value, recurring | Level 3    
Liabilities, Fair Value Disclosure [Abstract]    
Earnout warrant liabilities   0
Total liabilities measured at fair value 0 0
Fair value, recurring | Level 3 | Public common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants $ 0 0
Fair value, recurring | Level 3 | Private common stock warrants    
Liabilities, Fair Value Disclosure [Abstract]    
Common stock warrants   $ 0
v3.24.0.1
INCOME TAXES - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Deferred tax assets:    
Net operating losses $ 46,616 $ 34,454
Tax credit carryforward 1,454 909
Equity compensation 1,560 737
Capitalized research and development expenses 19,644 16,946
Inventory reserve 3,159 0
Deferred revenue 1,002 0
Other 2,761 2,153
Total deferred tax assets 76,196 55,199
Valuation allowance (75,590) (54,261)
Deferred tax assets, net of valuation allowance 606 938
Deferred tax liabilities:    
Right-of-use assets (606) (938)
Net deferred tax $ 0 $ 0
v3.24.0.1
INCOME TAXES - Narrative (Details) - USD ($)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Operating Loss Carryforwards [Line Items]    
Capitalized research and development expenses $ 19,644,000 $ 16,946,000
Increase in valuation allowance 21,300,000  
Addition to uncertain tax position related to reduction of research and development credit 382,000 613,000
Accrued interest and penalties related to uncertain tax positions 0 $ 0
Domestic    
Operating Loss Carryforwards [Line Items]    
Net operating loss carryforwards 166,300,000  
Research and development credits 2,900,000  
State and local    
Operating Loss Carryforwards [Line Items]    
Net operating loss carryforwards 202,400,000  
Research and development credits $ 28,000  
v3.24.0.1
INCOME TAXES - Schedule of Provision for Income Taxes (Details)
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Income Tax Disclosure [Abstract]    
Federal statutory tax rate 21.00% 21.00%
State tax, net of federal tax benefit 6.80% 7.20%
Stock compensation (1.90%) (0.20%)
Non-deductible officer compensation 0.008 (0.014)
Warrant liabilities revaluation 0.006 0.066
Earnout Shares liabilities revaluation 0 0.004
Permanent differences (0.001) 0.001
Research and development tax credits 0.50% 0.80%
Other (0.10%) 0.10%
Valuation allowance (27.60%) (34.60%)
Effective tax rate 0.00% 0.00%
v3.24.0.1
INCOME TAXES - Schedule of Uncertain Tax Positions (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward]    
Balance at beginning of period $ 905 $ 292
Additions related to prior year 170 0
Additions related to current year 382 613
Balance at end of period $ 1,457 $ 905
v3.24.0.1
GOVERNMENT GRANTS (Details)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
USD ($)
Government Assistance [Line Items]  
Government Assistance, Statement of Income or Comprehensive Income [Extensible Enumeration] Cost of revenue
Government Assistance, Current, Statement of Financial Position [Extensible Enumeration] Prepaid expenses and other current assets
Production tax credits  
Government Assistance [Line Items]  
Government assistance amount $ 824
Current grants receivable $ 824
v3.24.0.1
REVENUE - Schedule of Revenue Disaggregated by Source (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Disaggregation of Revenue [Line Items]    
Total revenue $ 7,540 $ 894
Product revenue    
Disaggregation of Revenue [Line Items]    
Total revenue 5,103 803
Service revenue    
Disaggregation of Revenue [Line Items]    
Total revenue 183 91
Other revenue    
Disaggregation of Revenue [Line Items]    
Total revenue $ 2,254 $ 0
v3.24.0.1
REVENUE - Schedule of Changes in Deferred Revenue (Details) - USD ($)
$ in Thousands
Dec. 31, 2023
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]    
Contract assets $ 253 $ 11
Deferred revenue $ 20,781 $ 8,610
v3.24.0.1
REVENUE - Narrative (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Revenue from Contract with Customer [Abstract]    
Contract assets increased $ 242  
Increase in deferred revenue 12,200  
Advance payment 19,000  
Revenue recognized 6,300  
Deposits returned to customers (506)  
Change in estimate of variable consideration (244)  
Deferred revenue, current 2,546 $ 6,168
Deferred revenue $ 18,200  
v3.24.0.1
DEFINED CONTRIBUTION PLAN (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Retirement Benefits [Abstract]    
Employer contributions $ 853 $ 674
v3.24.0.1
RELATED PARTY TRANSACTIONS (Details) - USD ($)
$ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Related Party Transaction [Line Items]    
Total revenue $ 7,540 $ 894
Deferred revenue, current 2,546 6,168
Accounts receivable, net 1,990 4,952
Deferred revenue 18,200  
Contract assets 253 11
Related party    
Related Party Transaction [Line Items]    
Total revenue 3 284
Deferred revenue 14,400 0
Energy Storage Systems Sales    
Related Party Transaction [Line Items]    
Deferred revenue, current   5
Energy Storage Systems Sales | Related party    
Related Party Transaction [Line Items]    
Total revenue 33 $ 284
Energy Warehouse Sales    
Related Party Transaction [Line Items]    
Deferred revenue, current 1  
Energy Warehouse Sales | Related party    
Related Party Transaction [Line Items]    
Accounts receivable, net 29  
Honeywell ACS Ventures LLC | Related party    
Related Party Transaction [Line Items]    
Deferred revenue, current 600  
Prepayment of equipment 15,000  
Deferred revenue 14,400  
Contract assets $ 736  
v3.24.0.1
NET LOSS PER SHARE - Schedule of Basic and Diluted Net Loss per Share (Details) - USD ($)
$ / shares in Units, $ in Thousands
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Numerator:    
Net loss to common stockholders, basic $ (77,578) $ (77,969)
Denominator:    
Net loss to common stockholders, diluted $ (77,578) $ (77,969)
Weighted average shares used in per share calculation, basic (in shares) 159,958,645 152,676,155
Weighted average shares used in per share calculation, diluted (in shares) 159,958,645 152,676,155
Net loss per share, diluted (in USD per share) $ (0.48) $ (0.51)
Net loss per share, basic (in USD per share) $ (0.48) $ (0.51)
v3.24.0.1
NET LOSS PER SHARE - Schedule Antidilutive Securities (Details) - shares
 12 Months Ended
Dec. 31, 2023
Dec. 31, 2022
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities (in shares) 44,911,825 21,043,791
Stock options    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities (in shares) 2,598,382 3,223,109
RSUs    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities (in shares) 13,162,368 6,346,955
Warrants    
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]    
Antidilutive securities (in shares) 29,151,075 11,473,727