Bill Mulligan: Sure. Sure. So the issue you’re alluding to is a warranty issue that is a long-standing warranty issue that goes back to the time of the spin. I think certainly beneficial for all parties to get that dispute behind us. So I think it’s as simple as that. On the payment bond, maybe, Kai, you could give some color on that.
Kai Strohbecke: So Phil, it’s just basically a payment security. Of course, we have experienced a time where SunPower has not paid us at the very beginning of this dispute that we have now settled I think both parties have an interest that we don’t get into such a situation again. So this payment bond is there to secure our deliveries because there are payment terms and that’s just the security for making sure that we collect the money.
Philip Shen: Got it. Okay. Thanks very much, guys. I’ll pass it on.
Kai Strohbecke: Thank you.
Operator: Please stand by for our next question. Our next question comes from the line of Donovan Schafer with Northland Capital Markets. Your line is open
Donovan Schafer: Hey, guys. Thanks for taking the questions. So I first want to ask about an article that was in the Albuquerque Journal reporting it says you made a request to the City Council for a $2.4 billion revenue bond. And according to the article, this revenue bond itself, it’s really about property tax abatement. But this — the $2.4 billion magnitude cited is a reference to — per the request or filings that the idea is that, that is the dollar amount or the estimated dollar amount you would be investing within the city limits or whatever the city councils jurisdiction is. So the question is, is $2.4 billion, is that — is that a useful — does that a utility as a reference point or a touch point in terms of expected cost?
Or is there something about it that would sort of lead us to stray, whether it’s they need — there are only certain — there’s a subset of costs that they can you allowed to include in the estimate or something like that, anything where it would be meaningfully misleading to us. And also, is that — do you know if that’s tied to the 3 gigawatt initial capacity or the 3.5 gigawatt.
Peter Aschenbrenner: Don, this is Peter. That’s not a useful reference point. We’re not planning to invest anywhere close to that amount of money, as we’ve said pretty consistently. The other thing we’ve said in our prepared remarks today was that we’ve settled on the 3.5 gigawatt capacity for the project.
Donovan Schafer: Okay. That’s — thank you for clarifying. For the DOE for the time line, so in the release you guys gave for the DOE loan guarantee and the offtake agreements, saying your target is to have updates on both before the fourth quarter call. Does that imply an interplay between these were maybe better than expected outcomes in the optic agreements could mean a lesser need on the DOE loan guarantee or vice versa? Or is it just the — or is the timing of updates on both fronts just a coincidence in this case?
Peter Aschenbrenner: Don, this is Peter again. The latter, the timing of the closure of the deli loan and of the going effective of the customer co-investment agreements would be contemporaneous.
Donovan Schafer: Okay. And then my last question is we talked about Maxeon 7. You talked about it’s not just the efficiency, but there’s also positive attributes are in hot spots degradation improvements. So do you anticipate — or maybe it’s too soon to say, but do you see yourself extending the 40-year warranty that you, I think, offer on Maxeon 6 now to Maxeon 7. Could that potentially end up being a warranty that goes beyond 40 years or so where would it be maybe less than that? And since it came up, the warranty dispute, the split between you guys and SunPower until in the response to Phil’s question, can you talk if any of that has to do with having such a long warranty if it’s related in a new way to providing warranties that go out for decades.
Bill Mulligan: Yes. The warranty length is something we always look at. But I would say, at the moment, we’re pretty happy with the 40-year warranty. We haven’t seen a lot of customer demand for anything more than that. I think we always look at what we’re reserving for warranty and as we have higher reliability products. There may be things we can do there. But yes, I don’t see any big changes in the warranty. This is more of a competitive attribute, right? Many of our competitors’ products have problems with things like hotspots and degradation over time. Technology like HJT that some of our competitors are pursuing. It’s fundamentally kind of an unstable compound that’s very sensitive to moisture degradation. We see that.
We have a lot of field experience with all these different products. So again, we’re always — we make the world’s best panel, and the attributes of that are really important. It’s not just about efficiency. So we sell that and that’s what we do. But the warranty is one piece of the equation. We don’t think there’s a lot of juice in particular to extend that. But we talk about it and who knows what the future holds, we’ll do what the market needs.
Peter Aschenbrenner: Donovan, this is Peter. Just your last question about the warranty dispute. That had nothing to do with the solar panel itself.
Donovan Schafer: Very helpful. Very helpful. Okay. Great. Thanks, guys. I’ll take the rest of my questions offline.
Operator: Thank you. Please standby for our next question. Our next question comes from the line of William Grippin with UBS. Please line is open.
