What the changes say
- Geological and technology risks now cover conventional geothermal, battery storage, and emerging EGS projects.
- Federal permitting uncertainty could constrain solar development on U.S. federal lands.
- Financing, debt, subsidiary cash restrictions, insurance, and counterparty exposure remain prominent financial risks.
- The OBBBA and EPA rules materially change the incentives and regulatory backdrop for projects.
What changed since the prior 10-K
New
- NewRisks Related to the Company’s Business and Operation
Our exploration, development, and operation of geothermal energy resources are subject to geological risks and uncertainties
Geothermal reservoirs may be commercially unviable or cool, lose pressure, or flow uncontrollably, increasing costs and reducing plant efficiency.
- NewRisks Related to the Company’s Business and Operation
Our investments and profitability in battery Energy Storage System (BESS) may be negatively affected by a number of factors, including increases in storage costs, expanded trade restrictions, risk of fire and volatility in merchant prices
BESS returns face volatile battery and lithium costs, China-related tariffs, equipment defects, fires, technology underperformance, and fluctuating merchant prices.
- NewRisks Related to the Company’s Business and Operation
Our investments in next-generation geothermal technologies including in EGS involve significant risks and may not achieve anticipated returns
Investments in emerging EGS technology may not deliver expected technical performance, commercial energy production, or returns.
- NewRisks Related to the Company’s Business and Operation
expand the geographic and resource base for geothermal energy, the technology has not yet been widely deployed at commercial scale
EGS projects face reservoir, drilling, seismicity, permitting, capital, timeline, regulatory, and limited operating-history risks at commercial scale.
- NewRisks Related to the Company’s Business and Operation
Some of our leases will terminate if we do not extract geothermal resources in “commercial quantities” or fail to comply with such leases or applicable law or if the lessor under any such lease defaults on any debt secured by the relevant property
Geothermal leases can terminate if resources are not extracted in commercial quantities, lease terms or laws are breached, or lessors default.
- NewRisks Related to Governmental Regulations, Laws and Taxation
The absence of new or renewed BLM permits for solar PV projects on U.S. federal lands could impair our development activities, project pipeline and growth prospects
Missing or delayed BLM permits could restrict solar and storage development on federal lands, causing delays, higher costs, lost site control, or impairments.
- NewRisks Related to Governmental Regulations, Laws and Taxation
Our operations are primarily conducted through our subsidiaries. We conduct no other business and, as a result, we depend entirely upon our subsidiaries’ earnings and cash flow
Debt, partner agreements, cash reserves, and withholding taxes may restrict subsidiaries’ ability to distribute cash to Ormat.
- NewRisks Related to Economic and Financial Conditions
If our project subsidiaries default on their obligations under such limited or non-recourse debt or lease financing, we may be required to make certain payments to the relevant debt holders, and if the collateral supporting such leveraged financing structures is foreclosed upon, we may lose certain of our power plants
Project subsidiary defaults could trigger limited-recourse payments to creditors or foreclosure and loss of financed power plants.
- NewRisks Related to Economic and Financial Conditions
We are exposed to various credit risks
Derivative and capped-call counterparties could default, disrupting currency hedges or leaving Ormat as an unsecured creditor.
- NewRisks Related to Economic and Financial Conditions
We may not be able to obtain sufficient insurance coverage to cover damages to our assets and profitability
Property damage and business interruption insurance may not cover losses from volcanic eruptions, earthquakes, floods, or other disasters.
- NewRisks Related to Economic and Financial Conditions
insurance to cover all book net equity may cause us to self-insure some or all of a particular location and losses, causing us to experience higher than expected insurance costs
Higher premiums, deductibles, unavailable coverage, or uninsured losses could force more self-insurance and increase costs.
Dropped
- DroppedRisks Related to the Company’s Business and Operation
Our exploration, development, and operation of geothermal energy resources are subject to geological risks and uncertainties, which may result in insufficient prospects to support our growth, decreased performance or increased costs for our power plants
- DroppedRisks Related to the Company’s Business and Operation
Strengthening our core geothermal business to new customers and geographical areas will have many of the same risks and uncertainties as those outlined above
Geothermal exploration could lack sufficient prospects, reduce plant performance, or increase costs.
- DroppedRisks Related to the Company’s Business and Operation
we incurred $9.1 million in losses associated with our Rabbit Hill facility because ERCOT restricted us from providing battery charging services
Expansion into new geothermal customers and regions could create opportunity costs, expenses, and asset impairments.
- DroppedRisks Related to the Company’s Business and Operation
Responses in various countries where we have business operations to Israel’s ongoing military conflicts on some of its borders or future similar conflicts may adversely affect our operations and may limit our ability to produce and sell our products
Rabbit Hill incurred $9.1 million after ERCOT restricted battery charging services.
- DroppedRisks Related to the Company’s Business and Operation
We encounter intense competition in the energy storage market
- DroppedRisks Related to Governmental Regulations, Laws and Taxation
We are a holding company whose primary assets are our ownership of the equity interests in our subsidiaries. We conduct no other business and, as a result, we depend entirely upon our subsidiaries’ earnings and cash flow
- DroppedRisks Related to Economic and Financial Conditions
capital on acceptable or favorable terms to us is necessary for the success of our growth strategy, particularly in enhancing our portfolio through M&A activities. Our attempts to obtain future financings may not be successful or on favorable terms
- DroppedRisks Related to Economic and Financial Conditions
We may issue additional shares of our common stock in connection with conversions of the Notes, and thereby dilute our existing stockholders and potentially adversely affect the market price of our common stock
- DroppedRisks Related to Economic and Financial Conditions
The fundamental change provisions of the Notes may delay or prevent an otherwise beneficial takeover attempt of us
Israel-related geopolitical perceptions could harm operations, production, and product sales.
- DroppedRisks Related to Economic and Financial Conditions
The Capped Call Transactions may affect the value of the Notes and our common stock
- DroppedRisks Related to Economic and Financial Conditions
We are subject to counterparty risk with respect to the Capped Call Transactions
- DroppedRisks Related to Economic and Financial Conditions
We are exposed to swap counterparty credit risk that could materially and adversely affect our business, operating results, and financial condition
Reworded
- 86% rewrittenRisks Related to Economic and Financial Conditions
We may be unable to obtain the additional financing we need to pursue our growth strategy and any future financing we receive may be less favorable to us than our current financing arrangements, either of which may adversely affect our ability to expand our operations
The risk now emphasizes financing for M&A and states that future funding may be unavailable or less favorable, rather than only describing project leverage.
- 75% rewrittenRisks Related to the Company’s Business and Operation
Conditions in and around Israel, where the majority of our senior management and our main product segment production and manufacturing facilities are located, may adversely affect our operations and may limit our ability to produce and sell our products, and support our Electricity segment
The risk now refers to possible re-escalation after the 2023–2025 Middle East wars instead of detailing specific attacks and locations.
Was: Conditions in and around Israel, where the majority of our senior management and our main production and manufacturing facilities are located, may adversely affect our operations and may limit our ability to produce and sell our products, and support our Electricity segment
- 74% rewrittenRisks Related to Economic and Financial Conditions
Our foreign power plants and foreign manufacturing operations expose us to risks related to fluctuations in currency rates, which may reduce our profits from such power plants and operations
The risk adds that significant strengthening of local currencies against the U.S. dollar could adversely affect foreign operations.
- 64% rewrittenRisks Related to the Company’s Business and Operation
We could be impacted by regulatory and other responses to climate change and other sustainability-related matters
The risk now specifically cites EPA greenhouse-gas permitting, monitoring, reporting, and methane-reduction rules.
- 58% rewrittenRisks Related to Governmental Regulations, Laws and Taxation
The reduction, elimination or inability to monetize government incentives could adversely affect our business, financial condition, future results and cash flows
The risk now covers BESS and solar projects and describes OBBBA geothermal tax-credit percentages through 2035.
- 56% rewrittenRisks Related to Economic and Financial Conditions
We have incurred substantial indebtedness that may decrease our business flexibility, access to capital, and/or increase our borrowing costs, and we may still incur substantially more debt, which may adversely affect our operations and financial results
Reported debt increased from $476.4 million of Notes at year-end 2024 to $2,659.6 million of long-term debt at year-end 2025, with Notes change provisions added.
- 38% rewrittenRisks Related to Ownership of Our Common Stock
Future equity issuances, including through our current or any future equity compensation plans, could result in dilution, which could cause the price of our shares of common stock to decline
The risk adds that Notes conversions may be outside Ormat’s control and more attractive when the share price exceeds the conversion price.
- 35% rewrittenRisks Related to the Company’s Business and Operation
We rely on power transmission facilities that we do not own or control
The risk adds that renewable-energy growth is increasing transmission congestion and extending interconnection-study timelines in some markets.
- 34% rewrittenRisks Related to the Company’s Business and Operation
Our financial performance depends on the successful operation of our geothermal, REG and solar PV power plants under the Electricity segment, as well as our Energy Storage facilities, which are subject to various operational risks
- 28% rewrittenRisks Related to the Company’s Business and Operation
Concentration of customers, specific projects and regions may expose us to heightened financial exposure
- 23% rewrittenRisks Related to the Company’s Business and Operation
Political, economic and other conditions in the emerging economies where we operate, may subject us to greater risk than in the developed U.S. economy, which may have a materially adverse effect on our business
All 44 risk factors
Headings as the filing states them, in filing order.
Risks Related to the Company’s Business and Operation
- 01Our financial performance depends on the successful operation of our geothermal, REG and solar PV power plants under the Electricity segment, as well as our Energy Storage facilities, which are subject to various operational risks34% rewritten
- 02Our exploration, development, and operation of geothermal energy resources are subject to geological risks and uncertaintiesNew
- 03Our investments and profitability in battery Energy Storage System (BESS) may be negatively affected by a number of factors, including increases in storage costs, expanded trade restrictions, risk of fire and volatility in merchant pricesNew
- 04Our investments in next-generation geothermal technologies including in EGS involve significant risks and may not achieve anticipated returnsNew
- 05expand the geographic and resource base for geothermal energy, the technology has not yet been widely deployed at commercial scaleNew
- 06Concentration of customers, specific projects and regions may expose us to heightened financial exposure28% rewritten
- 07Our international operations expose us to risks related to the application of international laws and regulations
- 08Political, economic and other conditions in the emerging economies where we operate, may subject us to greater risk than in the developed U.S. economy, which may have a materially adverse effect on our business23% rewritten
- 09Conditions in and around Israel, where the majority of our senior management and our main product segment production and manufacturing facilities are located, may adversely affect our operations and may limit our ability to produce and sell our products, and support our Electricity segment75% rewritten
- 10Some of our leases will terminate if we do not extract geothermal resources in “commercial quantities” or fail to comply with such leases or applicable law or if the lessor under any such lease defaults on any debt secured by the relevant propertyNew
- 11Our business development activities may not be successful and our projects under construction or facilities undergoing enhancement and repowering may encounter delays, which may impact our future growth
- 12Any one of these could give rise to delays, cost overruns, the termination of the plant expansion, construction or development or the loss (total or partial) of our interest in the project under development, construction, or expansion
- 13We rely on power transmission facilities that we do not own or control35% rewritten
- 14Our use of joint ventures may limit our flexibility with jointly owned investments
- 15Our operations could be adversely impacted by climate change and other extreme weather events
- 16We could be impacted by regulatory and other responses to climate change and other sustainability-related matters64% rewritten
- 17We may not be able to successfully conclude the transactions, integrate companies, which we acquired and may acquire in the future, which could materially and adversely affect our business, financial condition, future results and cash flow
- 18Changes in costs and technology may significantly impact our business by making our power plants and products less competitive resulting in the inability to sign new PPAs for our Electricity segment and new supply and EPC contracts for our Products segment
- 19Our intellectual property rights may not be adequate to protect our business
- 20A cyber-incident, cyber security breach, severe natural event or physical attack on our operational networks and information technology systems could have a material adverse effect on our financial condition, results of operations, liquidity and cash flows
Risks Related to Governmental Regulations, Laws and Taxation
- 21Our financial performance could be adversely affected by changes in the legal and regulatory environment affecting our operations
- 22Pursuant to the terms of some of our PPAs with investor-owned electric utilities and publicly-owned electric utilities in states that have renewable portfolio standards, the failure to supply the contracted capacity and energy thereunder may result in the imposition of penalties
- 23Most of our domestic power plants are Qualifying Facilities pursuant to PURPA, which largely exempts the power plants from the FPA, and certain state and local laws and regulations regarding rates and financial and organizational requirements for electric utilities
- 24The absence of new or renewed BLM permits for solar PV projects on U.S. federal lands could impair our development activities, project pipeline and growth prospectsNew
- 25The reduction, elimination or inability to monetize government incentives could adversely affect our business, financial condition, future results and cash flows58% rewritten
- 26Our operations are primarily conducted through our subsidiaries. We conduct no other business and, as a result, we depend entirely upon our subsidiaries’ earnings and cash flowNew
- 27We could be exposed to significant liability for violations of hazardous substances laws because of the use or presence of such substances at our power plants
- 28U.S. federal, state and international income tax law changes could adversely affect us
- 29Litigation, legal proceedings, regulatory investigations or other administrative proceedings could expose us to significant liabilities and reputational damage that could have a material adverse effect on us
Risks Related to Economic and Financial Conditions
- 30We may be unable to obtain the additional financing we need to pursue our growth strategy and any future financing we receive may be less favorable to us than our current financing arrangements, either of which may adversely affect our ability to expand our operations86% rewritten
- 31Also, in the absence of favorable financing options, we may decide not to build new plants or acquire facilities from third parties. Any of these alternatives could have a material adverse effect on our growth prospects
- 32Our debt obligations may adversely affect our ability to raise additional capital and will be a burden on our future cash resources, particularly if we elect to settle these obligations in cash upon conversion or upon maturity or required repurchase
- 33Our foreign power plants and foreign manufacturing operations expose us to risks related to fluctuations in currency rates, which may reduce our profits from such power plants and operations74% rewritten
- 34If our project subsidiaries default on their obligations under such limited or non-recourse debt or lease financing, we may be required to make certain payments to the relevant debt holders, and if the collateral supporting such leveraged financing structures is foreclosed upon, we may lose certain of our power plantsNew
- 35Possible fluctuations in the cost of construction, raw materials, commodities and drilling may materially and adversely affect our business, financial condition, future results, and cash flow
- 36Our commodity derivative activity may limit potential gains, increase potential losses, result in earnings volatility and involve other risks
- 37We have incurred substantial indebtedness that may decrease our business flexibility, access to capital, and/or increase our borrowing costs, and we may still incur substantially more debt, which may adversely affect our operations and financial results56% rewritten
- 38We are exposed to various credit risksNew
- 39We may not be able to obtain sufficient insurance coverage to cover damages to our assets and profitabilityNew
- 40insurance to cover all book net equity may cause us to self-insure some or all of a particular location and losses, causing us to experience higher than expected insurance costsNew
Risks Related to Force Majeure
- 41The existence of a prolonged force majeure event or a forced outage affecting a power plant, or the transmission systems could reduce our net income and materially and adversely affect our business, financial condition, future results and cash flow
- 42Threats of terrorism and other disasters may impact our operations in unpredictable ways and could adversely affect our business, financial condition, future results and cash flow
Risks Related to Ownership of Our Common Stock
- 43Future equity issuances, including through our current or any future equity compensation plans, could result in dilution, which could cause the price of our shares of common stock to decline38% rewritten
- 44The price of our common stock has in the past and may in the future fluctuate substantially, and your investment may decline in value
Other Ormat Technologies 10-Ks
- FY2024 10-K risk factors45 risks
Geothermal and energy storage operations drive revenue but face geological risks, customer concentration, and regulatory hurdles. Substantial international operations and management in Israel expose the company to geopolitical instability and currency fluctuations. High indebtedness, convertible notes, and capital needs create financial and dilution pressures.
Filed Feb 27, 2025
About this page
The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.