HASI

In this Form 10-Q, unless specifically stated otherwise or the context otherwise indicates, references to “we,” “our,” “us,” and the “Company” refer to HA Sustainable Infrastructure Capital, Inc., a Delaware corporation, Hannon Armstrong Sustainable Infrastructure, L.P., and any of our other subsidiaries. Hannon Armstrong Sustainable Infrastructure, L.P. is a Delaware limited partnership of which we are the sole general partner and to which we refer in this Form 10-Q as our “Operating Partnership.” We invest in projects which, among others things, are focused on reducing the impact of greenhouse gases that have been scientifically linked to climate change. We refer to these gases, which are often for consistency expressed as carbon dioxide equivalents, as carbon emissions. The following discussion is a supplement to and should be read in conjunction with the accompanying Condensed Consolidated Financial Statements and related notes and with our Annual Report on Form 10-K for the year ended December 31, 2025, as amended by our Amendment No. 1 to our Annual Report on Form 10-K for the year ended December 31, 2025 (collectively, our “2025 Form 10-K”), that was filed with the SEC. Our Business We are an investor in sustainable infrastructure assets advancing the energy transition. With more than $17 billion in Managed Assets, our investment strategy is focused primarily on long-lived real assets that generate long-term recurring cash flows. Our investments take many forms, including equity, joint ventures, real estate, receivables or securities, and other financing transactions. We generate recurring income from net investment income from our portfolio, from income through our residual ownership in securitization and co-investment structures, and from asset management and other services. We also generate income through gain-on-sale securitization transactions, broker/dealer and other services. We are internally managed by an executive team that has extensive relevant industry knowledge and experience, and have a team of over 170 clean energy investment, operating, and technical professionals. We have long-standing relationships with some of the leading U.S. clean energy project developers, owners and operators, utilities, and energy service companies (“ESCOs”), which provide recurring, programmatic investment and fee-generating opportunities, while also enabling scale benefits and operational and transactional efficiencies. Our investments are focused on three markets: •Behind-the-Meter (“BTM”): distributed renewable energy projects which reduce energy cost and/or usage and increase resiliency through residential, commercial & industrial, and community solar power and energy storage deployments, as well as energy efficiency improvements such as heating, ventilation, and air conditioning systems (HVAC), lighting, energy controls, roofs, windows, building shells, and/or combined heat and power systems. The off-taker or counterparty for BTM assets may be the building owner or occupant, and our investment may be secured by the installed improvements or other real estate rights; •Grid-Connected (“GC”): utility-scale renewable energy projects that deploy cleaner energy sources, such as solar, solar-plus-storage, and wind, to generate cleaner, lower cost energy. The offtakers or counterparties for GC assets may be utilities, electric users, or participants in the wholesale electric power markets who have entered into contractual commitments, such as power purchase agreements (“PPAs”), to purchase power produced by a renewable energy project at a specified price with potential price escalators for a portion of the project’s estimated life; and •Fuels, Transport, and Nature (“FTN”): a range of infrastructure assets that are designed to reduce emissions and/or provide environmental benefits in projects beyond the power grid, such as transportation and fuels, including renewable natural gas (RNG) plants, transportation fleet enhancements, and ecological restoration projects, among others. For FTN assets, the off-takers may be oil and gas refiners, industrial companies, and vertically integrated electric utilities. We have also identified additional markets beyond our three traditional markets in which we believe we can identify potential investments which align with our investment strategy. Our primary objective is to earn attractive risk-adjusted returns that sufficiently exceed our cost of capital. We believe we are able to generate superior risk-adjusted returns in part due to our adherence to a core set of investment criteria. In particular, we are focused primarily on investments which are: •income-generating sustainable infrastructure assets; •supported by underlying, long-term recurring cash flows; •contracted with creditworthy, incentivized off-takers; •reliant upon proven commercial technologies; and - 40 - •originated by programmatic clients. We completed approximately $1.1 billion and $1.7 billion of transactions during the three and six months ended June 30, 2026, respectively, compared to approximately $189 million and $894 million during the same period in 2025, respectively. As of June 30, 2026, our total Managed Assets are $17.6 billion, and include our Portfolio, the portion of assets owned by others in our co-investment vehicle, and other assets in securitization trusts. We held approximately $8.2 billion of transactions on our balance sheet, which we refer to as our “Portfolio.” As of June 30, 2026, our Portfolio consisted of over 600 assets and we seek to manage the diversity of our Portfolio by, among other factors, project type, project operator, type of investment, type of technology, transaction size, geography, obligor and maturity. The fee-generating assets attributable to other investors in our co-investment structures that were not consolidated as part of our Portfolio totaled approximately $1.5 billion. Certain of the assets we originate have a risk and return profile which makes them better suited for other institutional investors rather than for inclusion in our own Portfolio. We finance such investments via securitization transactions, where we transfer all or a portion of an investment to a securitization trust in exchange for cash and/or residual interests in the trust, and in some cases, ongoing fees. As of June 30, 2026, we manage approximately $7.4 billion in assets in such securitization trusts. Our equity investments in energy transition assets and infrastructure projects are operated by various renewable energy companies or by joint ventures in which we participate. These transactions allow us to participate in the cash flows associated with these projects, typically on a priority basis. Our debt investments in various renewable energy or other sustainable infrastructure projects or portfolios of projects are generally secured by the installed improvements, or other real estate rights. Our energy efficiency debt investments are usually assigned the payment stream from the project savings and other contractual rights, often using our pre-existing master purchase agreements with the ESCOs. Investing greater than 30% of our equity capital in any single investment requires the approval of a majority of our independent directors. A single investment of greater than 15% of of our equity capital may require the approval of a majority of our independent directors, if the investment does not meet certain board-approved investment criteria. We may adjust the mix and duration of our assets over time in order to allow us to manage various aspects of our Portfolio, including expected risk-adjusted returns, macroeconomic conditions, liquidity, availability of adequate financing for our assets, and our exemption from registration as an investment company under the 1940 Act. We believe we have a broad range of financing sources available to fund our growing investment volume. We finance our business through cash on hand, debt which may be either unsecured or secured and either fixed- or floating-rate, or equity, and we may also decide to finance such transactions through the use of off-balance sheet securitizations or co-investment structures. We have an active co-investment vehicle with KKR where we jointly invest in eligible projects, and we may consider further use of similar structures to allow us to expand the investments that we make or to manage our Portfolio diversification. Our revolving line of credit and our commercial paper programs allow us flexibility with regards to the timing of long-term capital markets transactions. We manage the interest rate risk associated with debt issuances through hedging activities, including the use of interest rate swaps. When issuing debt, we generally provide the estimated carbon emission savings using CarbonCount. In addition, certain of our debt issuances meet the environmental eligibility criteria for green bonds as defined by the International Capital Markets Association’s Green Bond Principles, which we believe makes our debt more attractive for certain investors compared to such offerings that do not qualify under these principles. We have a large and active pipeline of potential new opportunities that are in various stages of our underwriting process. We refer to potential opportunities as being part of our pipeline if we have determined that the project fits within our investment strategy and exhibits the appropriate risk and reward characteristics through an initial credit analysis, including a quantitative and qualitative assessment of the opportunity, as well as research on the relevant market and sponsor. Our pipeline of transactions that could potentially close in the next 12 months consists of opportunities in which we will be the lead originator as well as opportunities in which we may participate with other institutional investors. There can be no assurance with regard to any specific terms of such pipeline transactions or that any or all of the transactions in our pipeline will be completed. As of June 30, 2026, our pipeline consisted of more than $6.5 billion in new equity, debt and real estate opportunities. Of our pipeline, approximately 35% is related to BTM assets, 51% is related to GC assets, and 8% are related to FTN assets, with the remainder related to other sustainable infrastructure. As part of our investment process, we calculate the ratio of the estimated first year of metric tons of carbon emissions avoided by our investments divided by the capital invested to quantify the carbon impact of our investments. In this calculation, which we refer to as CarbonCount, we use emissions factor data, expressed on a CO2 equivalent basis, representing the locational marginal emissions associated with a project to determine an estimate of a project’s energy production or savings to compute an estimate of metric tons of carbon emissions avoided. In addition to carbon emission avoidance, we also consider other environmental attributes, such as water use reduction, stormwater remediation benefits and stream restoration benefits. We operate our business in a manner that permits us to maintain our exemption from registration as an investment company under the 1940 Act. - 41 - Factors Impacting our Operating Results We expect that our results of operations will be affected by a number of factors and will primarily depend on the size and transaction mix of our Portfolio, the income we receive from securitizations, syndications and other services, our Portfolio’s credit risk profile, changes in market interest rates, commodity prices, federal, state and/or municipal governmental policies, general market conditions in local, regional and national economies, and our ability to maintain our exemption from registration as an investment company under the 1940 Act. We provide a summary of the factors impacting our operating results in our 2025 Form 10-K under “Item 7. Management Discussion and Analysis of Financial Condition and Results of Operations – Factors Impacting our Operating Results.” Critical Accounting Policies and Use of Estimates Our financial statements are prepared in accordance with GAAP, which requires the use of estimates and assumptions that involve the exercise of judgment and use of assumptions as to future uncertainties. Understanding our accounting policies and the extent to which we make judgments and estimates in applying these policies is integral to understanding our financial statements. We believe the estimates and assumptions used in preparing our financial statements and related footnotes are reasonable and supportable based on the best information available to us as of June 30, 2026. Various uncertainties may materially impact the accuracy of the estimates and assumptions used in the financial statements and related footnotes and, as a result, actual results may vary significantly from estimates. We have identified the following accounting policies as critical because they require significant judgments and assumptions about highly complex and inherently uncertain matters and the use of reasonably different estimates and assumptions could have a material impact on our reported results of operations or financial condition. These critical accounting policies govern Consolidation, Equity Method Investments, Impairment or the establishment of an allowance under ASC 326 for our Portfolio and Securitization of Financial Assets. We evaluate our critical accounting estimates and judgments on an ongoing basis and update them, as necessary, based on changing conditions. We provide additional information on our critical accounting policies and use of estimates under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operation — Critical Accounting Policies and Use of Estimates” in our 2025 Form 10-K and under Note 2 to our financial statements in this Form 10-Q. Financial Condition and Results of Operations Our Portfolio Our Portfolio totaled approximately $8.2 billion as of June 30, 2026 and included approximately $4.1 billion of BTM assets, approximately $2.6 billion of GC assets, and approximately $1.5 billion of FTN assets. Approximately 56% of our Portfolio consisted of equity method investments in renewable energy related projects. Approximately 34% consisted of fixed-rate receivables and debt securities, approximately 6% consisted of floating-rate receivables, and 4% of our Portfolio was real estate leased to renewable energy projects under lease agreements and other Portfolio assets. Our Portfolio consisted of over 600 transactions with an average size of $12 million and the weighted average remaining life of our Portfolio of approximately 16 years as of June 30, 2026. Our Portfolio consisted of the following asset classes as of June 30, 2026: - 42 - The table below provides details on the interest rate and maturity of our receivables and debt securities as of June 30, 2026: Balance Maturity (in millions) Floating rate receivables, interest rates 9.50% or greater per annum $ 462 2027 to 2030 Fixed-rate receivables, interest rates less than 5.00% per annum 42 2029 to 2047 Fixed-rate receivables, interest rates from 5.00% to 6.49% per annum 46 2026 to 2041 Fixed-rate receivables, interest rates from 6.50% to 7.99% per annum 918 2027 to 2069 Fixed-rate receivables, interest rates from 8.00% to 9.49% per annum 948 2026 to 2067 Fixed-rate receivables, interest rates 9.50% or greater per annum 785 2026 to 2050 Receivables 3,201 (1) Allowance for loss on receivables (56) Receivables, net of allowance 3,145 Fixed-rate debt securities, interest rates less than 5.00% per annum 6 2033 to 2047 Fixed-rate debt securities, interest rates from 8.01% to 9.49% per annum 3 2055 Fixed-rate debt securities, interest rates 9.50% or greater per annum 63 2055 Total receivables and debt securities $ 3,217 (1) Excludes receivables held for sale of $73 million. The table below presents, for the receivables, debt securities, and real estate holdings of our Portfolio and our interest-bearing liabilities inclusive of our short-term commercial paper issuances and revolving credit facilities, the average outstanding balances, income earned, the interest expense incurred, and average yield or cost. Our earnings from our equity method investments are not included in this table. - 43 - Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (dollars in millions) Portfolio receivables, debt securities, and real estate Interest and rental income from receivables, debt securities, and real estate $ 83 $ 66 $ 165 $ 132 Average balance of receivables, debt securities, and real estate $ 3,446 $ 3,166 $ 3,458 $ 3,126 Average yield from receivables, debt securities, and real estate 9.7 % 8.4 % 9.5 % 8.5 % Debt Interest expense (1) $ 86 $ 69 $ 166 $ 134 Average balance of debt $ 5,584 $ 4,776 $ 5,425 $ 4,666 Average cost of debt 6.2 % 5.8 % 6.1 % 5.7 % (1) Excludes any loss on debt modification or extinguishment included in interest expense in our income statements. The following table provides a summary of our anticipated principal repayments for our receivables and debt securities as of June 30, 2026: Principal payment due by Period Total Less than 1 year 1-5 years 5-10 years More than 10 years (in millions) Receivables (excluding allowance) $ 3,201 $ 190 $ 2,162 $ 657 $ 192 Debt securities 72 — 9 4 59 See Note 6 to our financial statements in this Form 10-Q for information on: •the anticipated maturity dates of our receivables and debt securities and the weighted average yield for each range of maturities as of June 30, 2026; •the term of our leases and a schedule of our future minimum rental income under our land lease agreements as of June 30, 2026; •the Performance Ratings of our Portfolio; and •the receivables on non-accrual status. For information on our retained interests in securitization trusts, see Note 5 to our financial statements in this Form 10-Q. These assets do not have a contractual maturity date and the underlying securitized assets have contractual maturity dates until 2065. - 44 - Results of Operations Comparison of the Three Months Ended June 30, 2026 vs. Three Months Ended June 30, 2025 Three months ended June 30, 2026 2025 $ Change % Change (dollars in thousands) Revenue Interest and rental income $ 84,470 $ 67,441 $ 17,029 25 % Gain on sale of assets 15,831 7,829 8,002 102 % Management fees and retained interest income 12,850 8,988 3,862 43 % Origination fee and other income 7,639 1,427 6,212 435 % Total Revenue 120,790 85,685 35,105 41 % Expenses Interest expense 87,469 79,746 7,723 10 % Provision (benefit) for loss on receivables and retained interests in securitization trusts (11,006) 1,038 (12,044) (1160) % Compensation and benefits 26,513 18,131 8,382 46 % General and administrative 7,970 6,497 1,473 23 % Total expenses 110,946 105,412 5,534 5 % Income (loss) before equity method investments 9,844 (19,727) 29,571 (150) % Income (loss) from equity method investments 178,912 157,680 21,232 13 % Income (loss) before income taxes 188,756 137,953 50,803 37 % Income tax (expense) benefit (56,973) (38,158) (18,815) 49 % Net income (loss) $ 131,783 $ 99,795 $ 31,988 32 % •Net income increased by $32 million due primarily to an increase in income from equity method investments of $21 million and an increase in revenue of $35 million, offset partially by an increase in total expenses of $6 million and a $19 million increase in income tax expense. •Total revenue increased by $35 million due to an increase in interest and rental income of $17 million caused by a higher average asset yield, a $8 million increase in gain on sale of assets driven primarily by the origination of a held-for-sale receivable for which we elected the fair value option in the current period, a $6 million increase in origination fee and other income due to additional investments originated in co-investment structures, and a $4 million increase in management fees and retained interest income due to a larger fee-earning Managed Assets balance. •Interest expense increased by $8 million due primarily to a larger average outstanding debt balance and a higher average interest rate driven in part by the issuance of Junior Subordinated Notes that bear a higher interest rate but which reduce our need to issue equity to maintain our desired financial leverage ratio as a result of the partial equity treatment of these instruments by rating agencies. We recorded an $11 million benefit for loss on receivables and retained interests in securitization trusts, driven primarily by loan-specific reserve releases, including the release driven by the consolidation of a project company borrower as discussed in Note 6 to our financial statements in this Form 10-Q. •Compensation and benefits expenses increased by $8 million primarily due to growth in the size of the business and timing of incentive-based compensation accrued in the current period. •Income from equity method investments increased by $21 million primarily due to allocations of income related to tax credits allocated to other investors in solar projects, as those tax credits reduced the tax equity investors’ ongoing claim on the net assets of the project, partially offset by $70 million in equity method investment impairments as discussed in Note 3 to our financial statements in this Form 10-Q. •Income tax expense increased by $19 million primarily due to higher pre-tax book income driven by the items discussed above. - 45 - Comparison of the Six Months Ended June 30, 2026 vs. Six Months Ended June 30, 2025 Six Months Ended June 30, 2026 2025 $ Change % Change (dollars in thousands) Revenue Interest and rental income $ 167,159 $ 133,918 $ 33,241 25 % Gain on sale of assets 38,583 26,497 12,086 46 % Management fees and retained interest income 22,581 15,987 6,594 41 % Origination fee and other income 16,693 6,224 10,469 168 % Total Revenue 245,016 182,626 62,390 34 % Expenses Interest expense 186,744 144,424 42,320 29 % Provision (benefit) for loss on receivables and retained interests in securitization trusts (6,465) 4,850 (11,315) (233) % Compensation and benefits 62,018 43,110 18,908 44 % General and administrative 18,136 15,874 2,262 14 % Total expenses 260,433 208,258 52,175 25 % Income (loss) before equity method investments (15,417) (25,632) 10,215 (40) % Income (loss) from equity method investments 99,654 245,667 (146,013) (59) % Income (loss) before income taxes 84,237 220,035 (135,798) (62) % Income tax (expense) benefit (26,196) (62,055) 35,859 (58) % Net income (loss) $ 58,041 $ 157,980 $ (99,939) (63) % •Net income decreased by $100 million due to a decrease in income from equity method investments of $146 million and an increase in total expenses of $52 million. These impacts were partially offset by increases in total revenue of $62 million and a decrease in income tax expense of $36 million. •Total revenue increased by $62 million due to increases in interest and rental income, management fees and retained interest income and origination fee and other income. Interest and rental income increased due to a higher average Portfolio balance and a higher average asset yield. Management fees and retained interest income and origination fee and other income increases were driven by increased investment in a co-investment structure. Gain on sale of assets increased by $12 million driven partially by the origination of a held-for-sale receivable for which we elected the fair value option in the current period. •Interest expense increased by $42 million due to a larger average outstanding debt balance and a higher average interest rate driven in part by the issuance of Junior Subordinated Notes that bear a higher interest rate but which reduce our need to issue equity to maintain our desired financial leverage ratio as a result of the partial equity treatment of these instruments by rating agencies. We recorded a benefit for loss on receivables of $6 million driven by loan specific releases, including the release driven by the consolidation of a project company borrower as discussed in Note 6 to our financial statements in this Form 10-Q. •Compensation and benefits increased by $19 million primarily due to the acceleration of share-based compensation due to employees meeting certain criteria of the Company’s retirement policy. General and administrative expenses increased $2 million due to growth in the size of the company. •Income from equity method investments decreased by $146 million primarily due to $70 million in equity method investment impairments as discussed in Note 3, as well as allocations of income related to tax credits allocated to other investors in solar projects in the prior year which did not recur. •Income tax expense decreased by $36 million primarily due to lower income before income taxes driven primarily by lower income from equity method investments as discussed above. - 46 - Non-GAAP Financial Measures We consider the following non-GAAP financial measures useful to investors as key supplemental measures of our performance: (1) Adjusted Earnings, (2) Adjusted Recurring Net Investment Income, (3) Managed Assets, and (4) Adjusted Cash from Operations plus Other Portfolio Collections. These non-GAAP financial measures should be considered along with, but not as alternatives to, net income or loss as measures of our operating performance. These non-GAAP financial measures, as calculated by us, may not be comparable to similarly named financial measures as reported by other companies that do not define such terms exactly as we define such terms. Adjusted Earnings We calculate Adjusted Earnings as GAAP net income (loss) excluding equity-based expenses, provisions for loss on receivables, amortization of intangibles, losses (gains) from modification or extinguishment of debt facilities, and non-cash tax charges and including the earnings attributable to our non-controlling interest of our Operating Partnership. We also make an adjustment to eliminate our portion of fees we earn from related-party co-investment structures, and for our equity method investments in the renewable energy projects as described below. We will use judgment in determining when we will reflect the losses on receivables in our Adjusted Earnings, and will consider certain circumstances such as the time period in default, sufficiency of collateral as well as the outcomes of any related litigation. In the future, Adjusted Earnings may also exclude one-time events pursuant to changes in GAAP and certain other adjustments as approved by a majority of our independent directors. We believe a non-GAAP measure, such as Adjusted Earnings, that adjusts for the items discussed above is and has been a meaningful indicator of our economic performance in any one period and is useful to our investors as well as management in evaluating our performance, including as it relates to expected dividend payments over time. Additionally, we believe that our investors also use Adjusted Earnings, or a comparable supplemental performance measure, to evaluate and compare our performance to that of our peers, and as such, we believe that the disclosure of Adjusted Earnings is useful to our investors. Certain of our equity method investments in renewable energy and energy efficiency projects are structured using typical partnership “flip” structures where the investors with cash distribution preferences receive a pre-negotiated return consisting of priority distributions from the project cash flows, in many cases, along with tax attributes. Tax equity investors typically realize a large portion of their return through an allocation of the majority of tax attributes, such as tax depreciation and tax credits, as such credits are realized by the project. Once this preferred return is achieved, the partnership “flips” and the common equity investor, often the operator or sponsor of the project, receives more of the cash flows through its equity interests while the previously preferred investors retain an ongoing residual interest. We have made investments in both the preferred and common equity of these structures. Given our equity method investments are in project companies, they typically have a finite expected life. We typically negotiate the purchase prices of our equity investments based on our underwritten project cash flows discounted back to a net present value, based on a target investment rate, with the cash flows to be received in the future reflecting both a return on the capital (at the investment rate) and a return of the capital we have committed to the project. We use a similar approach in the underwriting of our receivables. Under GAAP, we account for these equity method investments using the HLBV method. Under this method, we recognize income or loss based on the change in the amount each partner would receive if the assets were liquidated at book value, after adjusting for any distributions or contributions made during such quarter. The amount received in a liquidation is typically based on the negotiated profit and loss allocation, which may differ from the allocation of distributable cash in any given period. The amount allocated to a tax equity investor during the hypothetical liquidation is typically reduced over time as tax attributes are allocated to them and they achieve portions of their preferred return. Accordingly, tax equity investors are allocated losses as they receive tax benefits, while the sponsors of the project and other investors subordinate to tax equity are allocated gains of a similar amount. Tax equity investors can generally elect either investment tax credits or production tax credits, which are each recognized over different time periods. This results in different HLBV income profiles despite the fact that cash allocations are typically not directly impacted by such a tax credit election. In addition, the agreed upon allocations of the project’s cash flows may differ materially from the profit and loss allocation used for the HLBV calculations in a given period. The application of the HLBV method described above results in GAAP income or loss in any one period that is often significantly different from the economic returns achieved from the investment in any one period as a result of the impact of tax allocations, the high levels of depreciation and other non-cash expenses that are common to renewable energy projects and the differences between the agreed upon profit and loss and the cash flow allocations. Thus, in calculating Adjusted Earnings, we adjust GAAP net income (loss) for certain of our investments where there are characteristics as described above to take into account our calculation of the return on capital (based upon the underwritten investment rate), as adjusted to reflect the performance of the project and the cash distributed. In calculating the underwritten investment rate, we make certain assumptions, including the timing and amounts of cash flows generated by our investments, which may differ from actual results, and may update this yield to reflect our most current estimates of project performance. We believe this equity method - 47 - investment adjustment to our GAAP net income (loss) in calculating our Adjusted Earnings measure is an important supplement to the income (loss) from equity method investments as determined under GAAP that helps investors understand the economic performance of these investments where HLBV income can differ substantially from the economic returns in any one period. We have acquired equity investments in portfolios of projects which have the majority of the distributions payable to more senior investors in the first few years of the project. The following table provides results related to our equity method investments for the three and six months ended June 30, 2026 and 2025. Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 (in millions) Income (loss) under GAAP $ 179 $ 158 $ 100 $ 246 Collections of Adjusted Earnings $ 29 $ 53 $ 64 $ 73 Return of Capital 40 15 70 21 Cash collected $ 69 $ 68 $ 134 $ 94 Adjusted Earnings does not represent cash generated from operating activities in accordance with GAAP and should not be considered as an alternative to net income (determined in accordance with GAAP), or an indication of our cash flow from operating activities (determined in accordance with GAAP), or a measure of our liquidity, or an indication of funds available to fund our cash needs, including our ability to make cash distributions. In addition, our methodology for calculating Adjusted Earnings may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, our reported Adjusted Earnings may not be comparable to similar metrics reported by other companies. - 48 - The table below provides a reconciliation of our GAAP net income (loss) to Adjusted Earnings for the three and six months ended June 30, 2026 and 2025. Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 $ Per Share $ Per Share $ Per Share $ Per Share (dollars in thousands, except per share amounts) Net income (loss) attributable to controlling stockholders (1) $ 128,625 $ 0.92 $ 98,445 $ 0.74 $ 56,659 $ 0.43 $ 155,057 $ 1.18 Adjustments: Reverse GAAP (income) loss from equity method investments (178,912) (157,680) (99,654) (245,667) Adjusted income from equity method investments (2) 98,263 79,094 189,366 148,956 Elimination of proportionate share of up-front origination fees earned from co-investment structures (3) (3,217) (559) (5,173) (2,512) Elimination of proportionate share of ongoing asset management fees earned from co-investment structures (4) (2,480) (1,013) (4,367) (1,763) Equity-based expenses 5,922 5,595 23,736 18,272 Provision for loss on receivables (11,006) 1,038 (6,465) 4,850 Loss (gain) on debt modification or extinguishment (5) 1,387 10,557 20,206 10,878 Amortization of intangibles 3 3 6 7 Non-cash provision (benefit) for income taxes (6) 56,973 38,158 24,767 62,055 Current year earnings attributable to non-controlling interest 3,158 1,350 1,382 2,923 Adjusted Earnings $ 98,716 $ 0.75 $ 74,988 $ 0.60 $ 200,463 $ 1.52 $ 153,056 $ 1.23 Shares for Adjusted Earnings per share (7) 132,071,511 125,312,458 131,834,550 123,970,466 (1)The per share data reflects the GAAP diluted earnings per share which is the most comparable GAAP measure to our Adjusted Earnings per share. (2)This is a non-GAAP adjustment to reflect the return on capital of our equity method investments as described above. (3)This adjustment is to eliminate the intercompany portion of up-front origination fees received from co-investment structures that for GAAP net income is included in the Equity method income line item. Since we remove GAAP Equity method income for purposes of our Adjusted Earnings metric, we add back the elimination through this adjustment. (4)This adjustment is to eliminate the intercompany portion of ongoing asset management received from co-investment structures that for GAAP net income is included in the Equity method income line item. Since we remove GAAP Equity method income for purposes of our Adjusted Earnings metric, we add back the elimination through this adjustment. (5)Included in Interest expense within our statements of operations. (6)Includes impact of cash paid for state income taxes during the three and six months ended June 30, 2026. (7)Shares used to calculate Adjusted Earnings per share represents the weighted average number of shares outstanding including our issued unrestricted common shares, restricted stock awards, restricted stock units, long-term incentive plan units, and the non-controlling interest in our Operating Partnership. We include any potential common stock issuances related to share based compensation units in the amount we believe is reasonably certain to vest. As it relates to Convertible Notes, we assess whether the instrument is more akin to debt or equity based on the value of the underlying shares compared to the conversion price during each period. If the instrument is determined to be more debt-like then we will include any related interest expense and exclude the underlying shares issuable upon conversion of the instrument. If the instrument is determined to be more equity-like and is more dilutive when treated as equity then we will exclude any related interest expense and include the weighted average shares underlying the instrument. We will consider the impact of any capped calls we hold in assessing whether an instrument is equity-like or debt-like. - 49 - Adjusted Recurring Net Investment Income We have a Portfolio of investments that we finance using a combination of debt and equity, and we also generate recurring income from our retained interests in securitization trusts and from ongoing management fees from our securitization trusts and our co-investment vehicle. We calculate Adjusted Recurring Net Investment Income as shown in the table below by adjusting GAAP-based net investment income for those earnings adjustments that are applicable to Adjusted Recurring Net Investment Income. We believe that this measure is useful to investors as it shows the recurring income generated by our Portfolio after the associated interest cost of debt financing and from our asset management activities. Our management also uses Adjusted Recurring Net Investment Income in this way. Our non-GAAP Adjusted Recurring Net Investment Income measure may not be comparable to similarly titled measures used by other companies. This measure also differs from our previously reported “Adjusted Net Investment Income”, as Adjusted Net Investment Income did not include Management fees and retained interest income. For further information on the adjustments between GAAP-based net investment income and Adjusted Recurring Net Investment Income, including information about our equity method investments, see the discussion above related to Adjusted Earnings. The following is a reconciliation of our GAAP-based net investment income to our Adjusted Recurring Net Investment Income for the three and six months ended June 30, 2026 and 2025: Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 (in thousands) Interest and rental income $ 84,470 $ 67,441 $ 167,159 $ 133,918 Management fees and retained interest income 12,850 8,988 22,581 15,987 Interest expense (87,469) (79,746) (186,744) (144,424) GAAP-based net investment income (loss) (1) 9,851 (3,317) 2,996 5,481 Adjusted income from equity method investments (2) 98,263 79,094 189,366 148,956 Loss (gain) on debt modification or extinguishment (3) 1,387 10,557 20,206 10,878 Amortization of real estate intangibles 3 3 6 7 Elimination of proportionate share of ongoing asset management fees earned from co-investment structures (4) (2,480) (1,013) (4,367) (1,763) Adjusted Recurring Net Investment Income $ 107,024 $ 85,324 $ 208,207 $ 163,559 (1)GAAP-based net investment income (loss) as reported in previous periods was not defined to include Management fees and retained interest income. It has been included here in comparative periods to reflect the new definition. (2)This is a non-GAAP adjustment to reflect the return on capital of our equity method investments as described above. (3)Included in Interest expense within our statements of operations. (4)GAAP net income includes an elimination of the intercompany portion of ongoing asset management fees received from co-investment structures in the Equity method income line item. Since GAAP Equity method income is not a component of this metric, we include the elimination of the management fee through this adjustment. Managed Assets We consolidate assets on our balance sheet, securitize assets off-balance sheet, and manage assets in which we coinvest with other parties via equity method investments. Therefore, certain of our receivables and other assets are not reflected on our balance sheet where we may have a residual interest in the performance of the investment, such as a retained interest in cash flows. Thus, we present our investments on a non-GAAP “Managed Assets” basis. We believe that our Managed Asset information is useful to investors because it portrays the amount of both on- and off-balance sheet assets that we manage, which enables investors to understand and evaluate the credit performance associated with our portfolio of receivables, equity investments and residual assets in off-balance sheet assets. Our management also uses Managed Assets in this way. Our non-GAAP Managed Assets measure may not be comparable to similarly titled measures used by other companies. The following is a reconciliation of our GAAP-based Portfolio to our Managed Assets as of June 30, 2026 and December 31, 2025: - 50 - As of June 30, 2026 December 31, 2025 (in millions) Equity method investments $ 4,782 $ 4,116 Receivables, net of allowance 3,145 3,280 Receivables held-for sale 73 114 Real estate and debt securities 75 76 Other Portfolio assets (1) 126 — GAAP-based Portfolio 8,201 7,586 Assets held in securitization trusts 7,391 7,220 Fee generating assets held in co-investment structures (2) 1,471 951 Non-fee generating assets held in co-investment structures (3) 501 314 Managed Assets $ 17,564 $ 16,071 (1)In the quarter ended June 30, 2026, we exercised certain of our protective rights under a loan agreement to a project company, which caused us to obtain the ability to direct the significant activities related to the projects, and accordingly to consolidate the project company to which the loans were made. This amount includes $165 million of in-construction fixed assets we consolidated, net of a $25 million liability to be paid upon project completion and $14 million of non-controlling interest, representing our economic claim on these assets. (2)Represents assets in our co-investment structures which are attributable to our co-investors and on which we earn an asset management fee. Total assets in co-investment structures are $2.9 billion and $1.9 billion as of June 30, 2026 and December 31, 2025, respectively. There are $1.4 billion of closed transactions which have not yet funded as of June 30, 2026. (3)Represents assets in our co-investment structures which are not attributable to our co-investors, and therefore are not fee-generating. Such assets are attributable to us but were financed with debt issued by the co-investment structure and therefore are not reflected in the carrying value of the equity method investment we hold in the structure. The following shows our Managed Assets by asset class as of June 30, 2026: Adjusted Cash from Operations plus Other Portfolio Collections - 51 - We operate our business in a manner that considers total cash collected from our Portfolio, after making necessary operating and debt service payments to assess the amount of cash we have available to fund dividends and investments. We believe that the aggregate of these items, which together we present as a non-GAAP financial measure titled Adjusted Cash from Operations plus Other Portfolio Collections, is a useful measure of the liquidity generated from our assets to fund both new investments and our regular quarterly dividends. This non-GAAP financial measure may not be comparable to similarly titled or other similar measures used by other companies. Although there is also not a directly comparable GAAP measure that demonstrates how we consider cash available for dividend payment and reinvestment, below is a reconciliation of this measure to Net cash provided by operating activities. Adjusted Cash from Operations plus Other Portfolio Collections also differs from Net cash provided by (used in) investing activities in that it excludes many of the uses of cash used in our investing activities such as Equity method investments, Purchases of and investments in receivables, Purchases of debt securities, and Collateral provided to and received from hedge counterparties. In addition, Adjusted Cash from Operations plus Other Portfolio Collections is not comparable to Net cash provided by (used in) financing activities in that it excludes many of our financing activities such as proceeds from common stock issuances and borrowings and repayments of unsecured debt. We evaluate Adjusted Cash from Operations plus Other Portfolio Collections on a trailing twelve month (“TTM”) basis, as cash collections during any one quarter may not be comparable to other single quarters due to, among other reasons, the seasonality of projects operations and the timing of disbursement and payment dates. Cash Available for Reinvestment is a non-GAAP measure which is calculated as Adjusted Cash from Operations Plus Other Portfolio Collections less dividend and distribution payments made during the period. We believe Cash Available for Reinvestment is useful as a measure of our ability to make incremental investments from internally generated capital after factoring in all necessary cash outflows to operate the business. Management uses Cash Available for Reinvestment in this way, and we believe that our investors use it in a similar fashion. Plus: Less: For the year ended, For the year ended, For the six months ended, For the six months ended, For the TTM ended, December 31, 2024 December 31, 2025 June 30, 2026 June 30, 2025 June 30, 2026 (in thousands) Net cash provided by operating activities $ 5,852 $ 167,317 $ 83,663 $ 42,450 $ 208,530 Changes in receivables held-for-sale 29,273 23,759 (1,019) 4,285 18,455 Equity method investment distributions received (1) 39,142 59,416 19,134 19,529 59,021 Proceeds from sales of equity method investments 9,472 — — — — Principal collections from receivables 600,652 705,675 343,834 172,080 877,429 Proceeds from sales of receivables 171,991 8,344 15,282 8,344 15,282 Proceeds from sales of land 115,767 — — — — Principal collections from debt securities (2) 47 1,849 198 253 1,794 Proceeds from the sale of a previously consolidated VIE (2) 5,478 — — — — Proceeds from sales of debt securities and retained interests in securitization trusts 5,390 — — — — Principal payments on non-recourse debt (72,989) (7,136) (4,910) (4,950) (7,096) Adjusted Cash from Operations plus Other Portfolio Collections 910,075 959,224 456,182 241,991 1,173,415 Less: Dividends and distributions (192,269) (209,776) (112,657) (102,443) (219,990) Cash Available for Reinvestment $ 717,806 $ 749,448 $ 343,525 $ 139,548 $ 953,425 - 52 - (1) Represents return of capital distributions from our equity method investments included in cash provided by (used in) investing activities section of our statements of cash flows which is incremental to any equity method investment distributions found in net cash provided by operating activities. (2) Included in Other in the cash provided (used in) investing activities section of our statement of cash flows. Plus: Less: For the year ended, For the year ended, For the six months ended, For the six months ended, For the TTM ended, December 31, 2024 December 31, 2025 June 30, 2026 June 30, 2025 June 30, 2026 (in thousands) Components of Adjusted Cash from Operations plus Other Portfolio Collections: Cash collected from our Portfolio 891,250 1,199,907 589,812 371,021 1,418,698 Cash collected from sale of assets (1) 325,051 33,389 21,156 23,434 31,111 Cash used for compensation and benefit expenses and general and administrative expenses (85,519) (89,088) (65,336) (51,858) (102,566) Interest paid (2) (172,679) (227,867) (122,556) (128,739) (221,684) Management fees and retained interest income and origination fees and other income 33,044 50,170 32,377 20,919 61,628 Principal payments on non-recourse debt (72,989) (7,136) (4,910) (4,950) (7,096) Other (8,083) (151) 5,639 12,164 (6,676) Adjusted Cash from Operations plus Other Portfolio Collections $ 910,075 $ 959,224 $ 456,182 $ 241,991 $ 1,173,415 (1) Includes cash from the sale of assets on our balance sheet as well as securitization transactions. (2) Amounts include the impact of cash settlements from derivatives which were designated as cash flow hedges. Adjusted Return on Equity Adjusted Return on Equity is a measure of the economic performance of our invested equity capital. Adjusted Return on Equity is calculated as our Adjusted Earnings divided by our average stockholder’s equity for the period, expressed on an annualized basis. The direct comparable GAAP measure is GAAP-based return on equity, which we have presented below. Adjusted Return on Equity differs from GAAP-based return on equity in that the numerator of the calculation contains those adjustments described in the Adjusted Earnings section above. We believe that Adjusted Return on Equity gives investors an understanding into our performance after considering the effects of financial leverage. Our management uses it in this way and we believe that our investors use it in a similar fashion, and as such, we believe that its disclosure is useful to our investors. Three months ended Six months ended June 30, 2026 June 30, 2025 June 30, 2026 June 30, 2025 (in thousands) (in thousands) GAAP Net Income $ 131,783 $ 99,795 $ 58,041 $ 157,980 Average Stockholders’ Equity (1) 2,592,432 2,529,690 2,614,244 2,488,152 GAAP-based Return on Equity 20.3 % 15.8 % 4.4 % 12.7 % Adjusted Earnings $ 98,716 $ 74,988 $ 200,463 $ 153,056 Average Stockholders’ Equity (1) 2,592,432 2,529,690 2,614,244 2,488,152 Adjusted Return on Equity 15.2 % 11.9 % 15.3 % 12.3 % (1) Average Stockholders’ Equity for quarterly periods is calculated as the average of the Stockholders’ Equity at the beginning and end of each quarterly period. Average Stockholders’ Equity for year-to-date periods is calculated as the average of the Stockholders’ Equity at the end of the preceding year and as of the end of each of the relevant period’s quarters. We have recast prior periods to conform with this calculation methodology. - 53 - Other Metric Average Annual Realized Loss on Managed Assets Average Annual Realized Loss on Managed Assets represents the average annual rate of our incurred losses, calculated as the amount of realized losses incurred in each year as a percentage of each year’s average annual Managed Assets. This metric is calculated over the ten-year period ending June 30, 2026. Incurred losses include both realized losses on equity method investments and realized credit losses on receivables and debt securities. Although there is not a direct comparable GAAP measure, we have presented Average Annual Recognized Loss on Managed Assets as calculated under GAAP for comparison. Average Annual Realized Loss on Managed Assets differs from Average Annual Recognized Loss on Managed Assets as calculated under GAAP as the timing is based on realization of loss rather than GAAP recognition. We believe that Average Annual Realized Loss on Managed Assets provides an additional metric to our underwriting quality over our history of investing in energy transition assets and infrastructure. Our management uses it in this way and we believe that our investors use it in a similar fashion to evaluate our investment performance, and as such, we believe that its disclosure is useful to our investors. In the quarter ended June 30, 2026, we recognized a GAAP impairment on two equity method investments to reflect changes in assumptions including the current market discount rate as discussed in Note 6 to our financial statements. These impairments totaled $70 million and are included in the Average Annual Recognized Loss on Managed Assets metric as calculated under GAAP below. Given that we have not yet realized any loss, the projects continue to operate, and we expect to receive distributions from the projects in excess of our invested capital, this loss is not yet reflected in Average Annual Realized Loss on Managed Assets. The table below shows these metrics as of June 30, 2026: Average Annual Recognized Loss (GAAP) on Managed Assets 0.17 % Average Annual Realized Loss on Managed Assets 0.08 % Liquidity and Capital Resources Liquidity is a measure of our available cash and committed short term borrowing capacity. We carefully manage and forecast our liquidity sources and uses on a frequent basis. Our sources of liquidity typically include collections from our Portfolio, cash proceeds from asset sales and securitizations, fee revenue, proceeds from debt transactions, and proceeds from equity transactions. Our uses of liquidity typically include funding investments, operating expenses (including cash compensation), interest and principal payments on our debt, and stockholder dividends and limited partner distributions. We typically pay our operating expenses, our debt service, and dividends from collections on our Portfolio, fee income and proceeds from sales of Portfolio investments. We use borrowings as part of our financing strategy to increase potential returns to our stockholders and we have available to us a broad range of financing sources, including secured or unsecured debt, equity and off-balance sheet securitization or co-investment structures. We maintain sufficiently available liquidity in the form of unrestricted cash and immediately available capacity on our credit facilities to manage our net cash flow. Below is a summary of our available liquidity by source: As of June 30, 2026 (in millions) Unrestricted cash $ 250 Unused capacity under our unsecured revolving credit facility (1) 1,812 Unused capacity under our Credit-enhanced Commercial Paper Program 125 Total liquidity $ 2,187 (1) As a credit enhancement for our Standalone Commercial Paper Notes, we reserve capacity under our unsecured revolving credit facility for the principal amount of any outstanding Standalone Commercial Paper Notes, if any. As of June 30, 2026, we had no outstanding Standalone Commercial Paper Notes. - 54 - Capital markets activity during the six months ended June 30, 2026 During the six months ended June 30, 2026, we issued $600 million principal amount of Junior Subordinated Notes due November 2056 and $400 million principal amount of Senior Notes due 2036. We used a portion of the proceeds of these issuances to redeem the outstanding $450 million principal amount of our 8.00% Senior Notes due 2027, with the remaining proceeds used to temporarily pay down short-term borrowings and ultimately invest in Portfolio assets. We used existing liquidity to redeem the outstanding $600 million principal amount of our 3.375% Senior Notes due 2026. We issued $1 billion principal amount of Senior Notes due 2033, and used a portion of the proceeds to pay down our Secured Term Loan. We did not issue any equity during the six months ended June 30, 2026. In July 2026, we replaced the Prior Unsecured Revolving Credit Facility when we entered into the Unsecured Revolving Credit Facility, which increased the maximum outstanding borrowing amount to $2.25 billion, and lowered the applicable margin applied to the benchmark rate by 10 basis points. The New Unsecured Revolving Credit Facility matures in 2031. We also replaced our Prior Unsecured Term Loan Facility and delayed-draw facility with a new Unsecured Term Loan Facility which has a balance of $400 million and matures in 2029. The applicable margin to the benchmark rate decreased by 47.5 basis points when compared to the Prior Unsecured Term Loan Facility. As discussed in Note 6 to our financial statements in this Form 10-Q, we have an active co-investment vehicle with KKR called CarbonCount Holdings 1, LLC (“CCH1”), under which we each had committed to invest $1.5 billion in eligible projects over an investment period concluding in December 2027. Maturities of recourse debt obligations In addition to general operational obligations, which are typically paid as incurred, and dividends and distributions, which are declared by our board of directors quarterly, we have potential future cash needs related to the payments due at maturity of our Commercial Paper Notes, Senior Notes, Junior Subordinated Notes, Convertible Notes and Term Loan facilities. We also have maturities related to our non-recourse debt. However, as it relates to the non-recourse debt, to the extent there are not sufficient cash flows received from investments pledged as collateral for such debt, the investor has no recourse against other corporate assets to recover any shortfalls and corporate cash contributions would not be required. As it relates to the Convertible Notes, those obligations may be settled at maturity with cash, or with the issuance of shares to the extent that the market price of our common stock exceeds the strike price on our Convertible Notes. For further information on our long-term debt, see Note 8 to our financial statements of this Form 10-Q. The maturity profile of our long-term recourse debt obligations as of June 30, 2026, is shown in the table below. - 55 - Additional borrowings and financial leverage management As a means of financing our business, we plan to continue to issue debt which may be either secured or unsecured and either fixed-rate or floating-rate, and may issue additional equity. We also expect to use both on-balance sheet and off-balance sheet securitizations. We also use separately funded special purpose entities or co-investment vehicles to allow us to expand the investments that we make or to manage Portfolio diversification. The decision as to how we finance specific assets or groups of assets is largely driven by risk, portfolio, and financial management considerations, including the potential for gain on sale or fee income, the overall interest rate environment including prevailing credit spreads, the terms of available financing, and financial market conditions. During periods of market disruptions, certain sources of financing may be more readily accessible than others which may impact our financing decisions. Over time, as market conditions change, we may use other forms of debt and equity in addition to these financing arrangements. The amount of financial leverage we may use will depend upon our target capital structure and the availability of particular types of financing and our assessment of the credit, liquidity, price volatility and other risks of such assets, and the interest rate environment. As shown in the table below, our debt to equity ratio was approximately 1.7 to 1 as of June 30, 2026, within our target operating range of between 1.5 to 1 and 2.0 to 1, and below our current board-approved leverage limit of up to 2.5 to 1. Our debt to equity ratio reflects 50% of our outstanding principal amount of Junior Subordinated Notes as equity as consistent with the treatment by rating agencies and as approved by our board. Our percentage of fixed rate debt including the impact of our interest rate derivatives was approximately 95% as of June 30, 2026, which is within our targeted fixed rate debt percentage range of 75% to 100%. Our targeted fixed rate debt range allows for percentages as low as 70% on a short term basis if we intend to repay or swap floating rate borrowings in the near term. The calculation of our fixed-rate debt and financial leverage as of June 30, 2026 and December 31, 2025 is shown in the chart below: June 30, 2026 % of Total December 31, 2025 % of Total (dollars in millions) (dollars in millions) Floating-rate borrowings (1) $ 278 5 % $ 49 1 % Fixed-rate debt (2) 5,623 95 % 5,100 99 % Total debt $ 5,901 100 % $ 5,149 100 % Debt for leverage calculation (3) $ 5,351 $ 4,899 Equity for leverage calculation (3) $ 3,200 $ 2,908 Leverage 1.7 to 1 1.7 to 1 (1)Floating-rate borrowings include borrowings under our floating-rate credit facilities and commercial paper issuances with less than six months original maturity, to the extent such borrowings are not hedged using interest rate derivatives. (2)Fixed-rate debt includes the impact of our interest rate derivatives on debt that is otherwise floating. Debt excludes securitizations that are not consolidated on our balance sheet. Since the borrowing rate associated with our junior subordinated notes is fixed for the first five years until which time we have the option to redeem them, we have included those notes as fixed-rate debt. (3)Our leverage ratio includes the impact, as approved by our board of directors and as consistent with the methodologies of the credit rating agencies, of reflecting the principal amount of any Junior Subordinated Notes outstanding as being 50% equity. We intend to use financial leverage for the primary purpose of financing our Portfolio and business activities and not for the purpose of speculating on changes in interest rates. While we may temporarily exceed the leverage limit, if our board of directors approves a material change to this limit, we anticipate advising our stockholders of this change through disclosure in our periodic reports and other filings under the Exchange Act. While we generally intend to hold our target assets that we do not securitize upon acquisition as long term investments, certain of our investments may be sold in order to manage our interest rate risk and liquidity needs, to meet other operating objectives and to adapt to market conditions. The timing and impact of future sales of receivables, debt securities, or equity method investments, if any, cannot be predicted with any certainty. We may, at any time and from time to time, seek to retire or purchase our outstanding debt through cash purchases and/or exchanges for equity or debt, in open-market purchases, privately negotiated transactions or otherwise. Such repurchases or exchanges, if any, will be upon such terms and at such prices as we may determine, and will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors. The amounts involved may be material. - 56 - We believe our identified sources of liquidity will be adequate for purposes of meeting our short-term and long-term liquidity needs, which include funding future investments, debt service, operating costs and distributions to our stockholders. Sources and Uses of Cash We had approximately $281 million and $145 million of unrestricted cash, cash equivalents, and restricted cash as of June 30, 2026 and December 31, 2025, respectively. The following table summarizes our cash flows for the six months ended June 30, 2026 and 2025. See our statements of cash flows for full details on the components of each category of cash flows. As discussed above, Adjusted Cash from Operations plus Other Portfolio Collections was $456 million for the six months ended June 30, 2026. For the six months ended, June 30, 2026 June 30, 2025 (in millions) Cash provided by (used in) operating activities $ 84 $ 42 Cash provided by (used in) investing activities (543) (384) Cash provided by (used in) financing activities 595 295 Increase (decrease) in cash and cash equivalents $ 136 $ (47) Discussion of changes in cash provided by (used in) operating activities Cash provided by (used in) operating activities for the six months ended June 30, 2026 was $41 million higher than the same period ended June 30, 2025. Net income was $100 million lower in the current period, and there was a greater adjustment to net income of $141 million when compared to the prior period. This increase to cash provided by operating activities was driven primarily by equity method investments, where $40 million more in equity method investment distributions were classified as operating. Discussion of changes in cash provided by (used in) investing activities Cash provided by (used in) investing activities for the six months ended June 30, 2026 was $159 million lower than the same period ended June 30, 2025. We invested $394 million additional in equity method investments in the current period, which was offset by $172 million more in principal collected from receivables in the current period as well as the collection of a $63 million reimbursement from a co-investor for CCH1 advances made by us on their behalf in December 2025. Discussion of changes in cash provided by (used in) financing activities Cash provided by (used in) financing activities for the six months ended June 30, 2026 was $300 million greater than the same period ended June 30, 2025. Net borrowings from long-term capital sources including Senior Notes, Convertible Notes, Junior Subordinated Notes, and term loans were $948 million higher than in the prior period. We had $527 million lower net borrowings from short-term sources including our unsecured revolving credit facility and our commercial paper programs. We also issued $120 million in common stock in the prior period, which did not recur in the current period. Supplemental Guarantor Information The Company and each of Hannon Armstrong Sustainable Infrastructure, L.P., Hannon Armstrong Capital, LLC. HAC Holdings I LLC, HAC Holdings II LLC, HAT Holdings I LLC and HAT Holdings II LLC (the “Subsidiary Guarantors”) have filed registration statements with the SEC pursuant to which the Company has offered and may in the future offer and sell debt securities from time to time and such securities have been and may be guaranteed by the Subsidiary Guarantors. The Subsidiary Guarantors are consolidated in the Company’s Consolidated Financial Statements and separate Consolidated Financial Statements of the Subsidiary Guarantors have not been presented in accordance with Rule 3-10 of Regulation S-X. Furthermore, as permitted under Rule 13-01(a)(4)(vi), the Company has excluded the summarized financial information for the Subsidiary Guarantors as the assets, liabilities and results of operations of the Company and the Subsidiary Guarantors are not materially different than the corresponding amounts presented in the Consolidated Financial Statements of the Company, and management believes such summarized financial information would be repetitive and not provide incremental value to investors. Off-Balance Sheet Arrangements We have relationships with non-consolidated entities or financial partnerships, often referred to as structured investment vehicles, special purpose entities, or variable interest entities, established to facilitate the sale of securitized assets. We have - 57 - retained interests in securitization trusts (including any outstanding servicer advances) of approximately $336 million as of June 30, 2026, that may be at risk in the event of defaults or prepayments in our securitization trusts and certain limited guarantees as discussed below. We have not guaranteed any obligations of non-consolidated entities or entered into any commitment or intent to provide additional funding to any such entities except as disclosed in Note 9 to our financial statements in this Form 10-Q. A more detailed description of our relations with non-consolidated entities can be found in Note 2 to our financial statements in this Form 10-Q. Additionally, we have made certain loans to equity method investees which we describe in Note 6 to our financial statements in this Form 10-Q. In connection with some of our transactions, we have provided certain limited guarantees to other transaction participants covering the accuracy of certain limited representations, warranties or covenants and provided an indemnity against certain losses from “bad acts” including fraud, failure to disclose a material fact, theft, misappropriation, voluntary bankruptcy or unauthorized transfers. In some transactions, we have also guaranteed our compliance with certain tax matters, such as negatively impacting the investment tax credit and certain other obligations in the event of a change in ownership or our exercising certain protective rights. Dividends Any distributions we make will be at the discretion of our board of directors and will depend upon, among other things, our actual results of operations. These results and our ability to pay distributions will be affected by various factors, including the net interest and other income from our assets, our operating expenses and any other expenditures. In the event that our board of directors determines to make distributions in excess of the income or cash flow generated from our assets, we may make such distributions from the proceeds of future offerings of equity or debt securities or other forms of debt financing or the sale of assets. The dividends declared in 2025 and 2026 are described in Note 11 to our financial statements in this Form 10-Q. Book Value Considerations As of June 30, 2026, we carried only our debt securities, our receivables held-for-sale for which we had elected the fair value option, if any, our retained interests in securitization trusts, and derivatives at fair value on our balance sheet. As a result, in reviewing our book value, there are a number of important factors and limitations to consider. Other than those assets listed above that are carried on our balance sheet at fair value as of June 30, 2026, the carrying value of our remaining assets and liabilities are typically determined using a cost basis approach in accordance with GAAP, adjusted for income or loss recognized on and cash collected from such assets. Other than the allowance for current expected credit losses applied to our receivables, our remaining assets and liabilities do not incorporate other factors that may have a significant impact on their value, most notably any impact of business activities, changes in estimates, or changes in general economic conditions, interest rates or commodity prices since the dates the assets or liabilities were initially recorded. Accordingly, our book value does not necessarily represent an estimate of our net realizable value, liquidation value or our fair market value.