Jason Few: Ryan, good morning, and thank you for the question. Yes, as we have indicated, as a company, we have begun to really focus on creating a better balance between our power purchase agreement opportunities that we drive, and product sales. So we are building a pipeline that enables us to do both of those things because we think continuing to offer multiple ways for our customers to purchase from us is a benefit to us as a company. But we see strong pipeline builds not only in our traditional markets, but as we expand into new markets outside of kind of our core. We are seeing strong product demand and those continue — those generally tend to be more product sale focused markets as opposed to PPAs. And so, we think that over the coming quarters, you will see more from us on product sales as an overall opportunity.
Ryan Pfingst: That’s helpful. And then turning to the generation segment, can you talk a little bit about the economics of the Derby projects or maybe at a higher level how they might help the profitability of the generation segment as a whole?
Jason Few: Sure. I think maybe Mike could give you a sense of how we think about margin on our generation business and what we’ve seen happen over the last several quarters and certainly this quarter. But Mike can walk you through that.
Mike Bishop: Sure. Good morning Ryan, and thanks for joining the call. So yes, as we think about the two Derby projects that that will add meaningful generation revenue, right now, today we’re producing about 44 million on an annualized rate. We did about 11 million of generation revenue this quarter. So, 44 million today, but adding obviously the large Derby project, another 14 megawatts will make a meaningful increase there. When we think about profitability of the generation portfolio, we target EBITDA margins in our generation portfolio of between 40% to 50%, when you back — if you look at just last quarter’s results, when you back out the Toyota one-time charges as well as depreciation, we’re in the 46% range right now. So, we would expect that to continue as we add additional operating assets in the portfolio.
Operator: [Operator Instructions] Your next question comes from the line of Eric Stine from Craig-Hallum. Your line is open.
Eric Stine: So maybe I’ll just stick with generation, curious, so now with Derby coming on, I think you’ll be at what 63 — you’ll be around 60 megawatts. And I know and this goes back a while, so not, this isn’t necessarily a target you’ve given, but at one-time you had kind of a 50 to 60 megawatt area where you thought you’d breakeven. Obviously, you’ve got a lot of irons in the fire, so you’ve taken on more expenses. Do you kind of have high level megawatts in generation portfolio breakeven number?
Mike Bishop: Good morning, Eric. This is Mike. So, historically, if you go back four plus years ago, we were really centering the business around the generation portfolio with a meaningful backlog of projects that we had. So to your point, we’ve been working really hard at getting those projects up online. We’ll be north of 60 megawatts after Derby comes online. And back at that time we were focusing the business on getting to EBITDA positive around the generation portfolio. Fast forward a couple of years with the energy transition now being here in a big way with global support around what we’re doing. We’ve accelerated investments around our different technologies and Jason talked about both solid oxide, but also carbon capture that has increased both our operating expenses and CapEx, which has pushed out our profitability into the future.
But we made that trade off in order to get these technologies to market. When we look at the external targets we’ve put out there. We’re targeting getting over 300 million of, of revenue in 2025 and over a billion by 2030. We’re still confident in those targets and with the increased revenue we would expect profitability to come as well.
Eric Stine: And I mean, is it something where we should think about, I mean is there a time in the future, say when carbon capture, when maybe that has progressed, you’ve gotten through the pilot project program where that spending maybe tails off a little bit? I mean, I know this is all dependent on what your spend looks like. So maybe how do you think about those things? Or do you think that you’re going to have kind of this elevated spend for the well foreseeable future or longer term than that?
Mike Bishop: So, when we look at the R&D spend, we ramped that up here over the last couple years. We have not put out, guidance of when that would come back down. But clearly, as we’ve talked about, we’re investing in, in first article products, that we’re building here in our Connecticut facilities. And as those become commercial, that will shift up to cost to sales, which would likely drive down research and development expenses in the future. But we haven’t put out specific guidance around that. And then just going back to the question around megawatt guidance, as we look at the revenue potential for different products that we have out there now, it’s different math than just dollars, dollars per megawatt. We can potentially see, higher revenues, particularly around a project like Tri-gen that has multiple attributes coming out, not just power generation, but the hydrogen and water.
And then obviously with government incentives out there around like the PTC credit that was not there, a couple of years ago, potentially higher revenue opportunities for those projects than just a dollar per megawatt.
Operator: And our final question today comes from the line of Noel Parks from Tuohy Brothers. Your line is open.
Noel Parks: Just had a couple. Talking about the generation business and more recent investments in new technologies. Can you just talk about sort of the state of your business momentum with generation, new customers, anything has that shifted in terms of how you characterize the source of customers that are being more aggressive, whether they’re moving any faster or as with so many things waiting for sort of more of the IRA and infrastructure guidance?
