About Our Business

How does Altus generate revenue?

Altus currently generates revenue in several ways:

We sell solar energy (in the form of electricity measured in kilowatt hours) to our customers from solar systems that we own and operate on roofs, in parking lots and on ground-mounted sites across the country. We generate revenue from energy storage systems (large batteries) that we own and operate and that deliver resiliency benefits, load-shifting and power circuit stability to our customers, and we make revenue from generating and selling renewable energy credits.

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How long are the contracts that Altus signs with its customers?

We typically sign contracts with terms of 20 years or longer to sell power from assets that Altus builds, owns, and operates. Our company was started over a decade ago and we still service our original customers under the same agreements they signed at inception.

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Where are Altus’ clients and assets located?

Our assets are generally between 1 and 10 megawatts in size and are either roof-mounted on commercial or industrial-scale buildings, on carports in big parking lots or ground-mounted – often next to or immediately above where our clients are located and where they consume electricity. We’re currently delivering clean electricity and/or energy storage benefits to clients in 22 states and we’re working to expand into additional states.

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How do you approach a site where the building owner and tenant are different entities?

We typically lease the rooftop from the building owner and sign a power purchase agreement with the tenant who will consume the power from the asset that we build and operate.

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What is the difference between a power purchase agreement (PPA) and a net metering credit agreement (NMCA)?

A PPA is a contract where Altus delivers solar energy directly into a customer’s electrical circuit, behind its electricity meter. Under an NMCA, Altus produces clean energy for the benefit of a customer, but delivers it into the local utility grid. The local utility then credits the customer for each kilowatt hour that Altus delivers and the credit appears on the customer’s monthly utility bill. Both types of contracts are long-term and can have either fixed or variable rates depending on the customer’s needs. The primary advantage of an NMCA is that customers don’t need to be located at our solar array to benefit from the clean energy produced.

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Are your assets developed specifically for commercial customers?

Our assets primarily serve commercial, industrial and municipal customers but we also have a growing residential segment of customers in our community solar program. See Community Solar below for additional details.

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Why doesn’t Altus sell its assets and recycle capital?

Our business is to underwrite, build, own and operate assets that meet our return threshold and that generate cash which can be reinvested into additional opportunities, with new and existing clients. We also believe there is great potential to add additional revenue streams to existing client engagements, like asset repowering, battery storage and electric vehicle (EV) & commercial fleet charging.

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The C&I Solar Market

What Does C&I Solar mean?

C&I stands for Commercial & Industrial and includes clean energy generation, energy storage and delivery (into buildings, communities and vehicles)

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How is C&I Solar different from residential roof-top solar?

C&I Solar has economies of scale-benefits when compared to residential solar systems, both in the acquisition of customers and in the construction of our solar generation and energy storage systems.

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How is C&I Solar different from utility-scale solar?

Utility-scale solar involves lengthy development processes and traditionally sells the energy produced into the grid and utilities at wholesale prices. C&I Solar is characterized by relatively shorter development processes – building solar and energy storage on and near existing buildings requires less permitting. Additionally, Altus mostly sells energy at a discount to retail prices.

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How large is the market for commercial-scale assets?

WoodMac1 estimates the commercial-scale addressable market at 145,000 megawatts with annual installation forecast currently between 2,000 and 3,000 megawatts. Altus Power is the only publicly traded independent C&I solar plus storage company.

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Community Solar

What is the difference between community solar and residential rooftop solar?

Community solar provides a way for residential customers to purchase portions of the clean energy generated by our C&I-scale solar arrays without having to install solar modules on their roofs. Customers who subscribe are allocated a portion of the generation from our solar arrays and receive a credit on their local utility bill for the quantity purchased. Unlike residential solar, which usually requires a roof or a yard for placement of solar modules, community solar allows multifamily-housing inhabitants and tenants to participate in the benefits of clean electricity.

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Why is community solar a focus for a commercial solar company like Altus?

Community solar expands the reach of our projects into the residential customer class while permitting us to focus on building large solar arrays on commercial and industrial rooftops, in parking lots and occasionally, on ground lots. This increases our total addressable market and we’re very encouraged with the rapid growth of the community solar segment.

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How large is the community solar market?

We currently serve over 5,000 community customers and have solar arrays in construction that we expect will serve thousands more. Community solar is available in 7 states2 and Altus looks forward to seeing it introduced in more states across the country.

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Strategic partnerships with CBRE and Blackstone

Why partner with Blackstone?

Blackstone has been a capital provider and sponsor of Altus since 2014 and currently owns approximately 13%3 of our Class A common shares. Blackstone has been an impactful partner to Altus and has helped shape our company in several ways, from launching the first ever rated senior funding facility for C&I solar assets to providing support to our decision making and reporting structures and by serving on our Board. Blackstone is also the largest owner of commercial real estate globally and is working closely with Altus to meet its ESG goals and meet carbon reduction commitments.

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Why did Altus Partner with CBRE?

CBRE is the largest manager of commercial real estate in the world and can provide direct access to clients and deal flow for Altus. CBRE is also the largest commercial real estate developer in the US and owns significant real estate through its investment management business. CBRE is committed to reducing carbon emissions at its client properties for the benefit of all its stakeholders. CBRE chose to sponsor Altus Power to help achieve this goal. CBRE owns approximately 16%4 of Class A common shares and has a seat on our Board.

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What are some other benefits of our partnership with CBRE and Blackstone?

Both Blackstone and CBRE have access to cost-efficient sourcing of goods and services due to their scale, which gives Altus access to preferred pricing. Altus has also begun to leverage CBRE’s development and project management expertise on potential solar, storage and electric vehicle charging projects serving customers nationally.

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Our Pipeline and how we convert it into operational assets that generate revenue

What does the pipeline consist of?

Approximately 50% of the pipeline consists of development and new construction assets. This portion of our pipeline includes client engagements from channel partners that are, in some instances, fully developed and ready for immediate construction. Others are opportunities that come either from channel partners or from our relationships with CBRE and Blackstone, where Altus will lead the development and construction process. Finally, we see additional asset opportunities from existing customers who wish to grow the amount of solar energy they purchase or add energy storage or EV charging.

Approximately 50% of our pipeline consists of operating assets, either single assets or smaller batches of several assets and larger portfolio acquisition opportunities that we believe represents potentially strategically significant additions of clients and assets to Altus.5

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How long does it take Altus to move an asset from client engagement to commercial operation and revenue being generated?

A client engagement with an asset originated by one of our channel partners, where the development is completed and only construction remains has typically taken 6 to 9 months to turn into operation after we have an agreement on terms. Client engagements and assets where Altus initiates development, such as those with a lead from CBRE or Blackstone, have historically taken 12 to 15 months from agreed terms to commercial operation. In the current environment, these timelines have been extended by between 3 to 6 months due to extensions required for permitting, interconnection delays and supply chain issues.

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Why does Altus acquire operating assets?

Altus has executed on acquisitions of portfolios of clients and assets in C&I solar plus storage and community solar. In addition to harvesting operating synergies, we believe our team’s significant transactional experience, structuring creativity and efficient cost of capital position us to produce solid returns with the added benefit of a shorter runway to generating cash flow.

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1 WoodMac “Total Addressable Market” published August 2020
2 Includes states in construction
3 Blackstone Alternative Credit Advisors, L.P. owns approximately 20.8 million shares, or 13% of Class A shares, as of October 20, 2022
4 CBRE Acquisitions Sponsor, LLC owns approximately 24.6 million shares, or 16% of Class A shares, as of October 20, 2022
5 These acquisitions are subject to due diligence and the execution of definitive agreements and there is no guarantee as to when or if the prospective acquisitions in our pipeline will be realized or make a positive contribution to our operating results.

* Forward-Looking Statements. This discussion of Frequently Asked Questions for Altus Power, Inc. (as used in this section, “Altus” or the “Company”) has been prepared by Altus’ management and is based only on information currently available to management and speaks to circumstances only as of the date on which it is made. You should read this discussion together with our condensed consolidated financial statements and related notes appearing elsewhere our 2021 Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 24, 2022 (the “2021 Annual Report on Form 10-K”) and subsequent Quarterly Reports on Form 10-Q. Any references in this section to “we,” “our” or “us” shall mean Altus. In addition to historical information, this document contains statements that are considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. This document relates to predicted or potential future events and financial results, such as statements of our plans, strategies and intentions, or our future performance or goals that are based upon management's current expectations. Our forward-looking statements can often be identified by the use of forward-looking terminology such as “aims,” “believes,” “expects,” “intends,” “may,” “could,” “will,” “should,” “plans,” “projects,” “forecasts,” “seeks,” “anticipates,” “goal,” “objective,” “target,” “estimate,” “future,” “outlook,”, “strategy”, “vision,” or variations of such words or similar terminology. Investors and prospective investors are cautioned that such forward-looking statements are only projections based on current estimations. These statements involve risks and uncertainties and are based upon various assumptions. Such risks and uncertainties include, but are not limited to the risks as described in the "Risk Factors" in our 2021 Annual Report on Form 10-K. These risks and uncertainties, among others, could cause our actual future results to differ materially from those described in our forward-looking statements or from our prior results. Any forward-looking statement made by us in this document is based only on information currently available to us and speaks to circumstances only as of the date on which it is made. We are not obligated to update these forward-looking statements, even though our situation may change in the future.

Such forward-looking statements are subject to known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside Altus Power’s control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. These risks, uncertainties, assumptions and other important factors include, but are not limited to: (1) the ability of Altus Power to maintain its listing on the New York Stock Exchange; (2) the ability to recognize the anticipated benefits of the recently completed business combination and related transactions, which may be affected by, among other things, competition, the ability of Altus Power to grow and manage growth profitably, maintain relationships with customers, business partners, suppliers and agents and retain its management and key employees; (3) changes in applicable laws or regulations; (4) the possibility that Altus Power may be adversely affected by other economic, business, regulatory and/or competitive factors; and (5) the impact of COVID-19 on Altus Power’s business.

This discussion is not intended to be all-inclusive or to contain all the information that a person may desire in considering an investment in Altus Power and is not intended to form the basis of an investment decision in Altus Power. All subsequent written and oral forward-looking statements concerning Altus Power or other matters and attributable to Altus Power or any person acting on its behalf are expressly qualified in their entirety by the cautionary statements above.