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Income taxes | 12 Months Ended
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Dec. 31, 2023
Income Tax Disclosure [Abstract] |
Income taxes | Income taxes In 2022, the Company became the sole owner of GREP. GREP is a disregarded entity for U.S. federal income tax purposes. Prior to the Business Combination, GREP and the associated activities held by the Funds were treated as partnerships for U.S. federal income tax purposes and were not subject to U.S. federal income tax. Any taxable income or loss generated prior to the Business Combination was passed through to and included in the taxable income or loss of its members. As a result of the Business Combination, the Funds' net assets were transferred to the Company resulting in carryover tax basis of those assets. The Company is a C corporation and subject to U.S. federal income tax and state and local income taxes. As described in Note 2, the Company corrected the previously reported deferred tax liability as of December 31, 2022. The Components of income tax expense were as follows for the periods indicated:
| Year Ended December 31,
(in thousands) | 2023 |  | 2022 |  | 2021
Current |  |  |  |  |
Federal | $ | — |  |  | $ | — |  |  | $ | — |
State | 209 |  |  | — |  |  | — |
| 209 |  |  | — |  |  | — |
Deferred |  |  |  |  |
Federal | $ | 22,314 |  |  | $ | 11,444 |  |  | $ | — |
State | 1,960 |  |  | 1,406 |  |  | — |
| 24,274 |  |  | 12,850 |  |  | — |
Income tax expense | $ | 24,483 |  |  | $ | 12,850 |  |  | $ | — |
The Company's effective tax rate was 23.2%, 4.7% and 0.0% for years ended December 31, 2023, 2022 and 2021, respectively. For 2023, the effective tax rate differs from the enacted statutory rate of 21% primarily due to the impact of certain discrete items and state income taxes. For 2022, the effective tax rate differs from the enacted statutory rate of 21% primarily due to the allocations of profits and losses to ultimate members prior to the Business Combination and the impact of state income taxes. The following reconciles the income tax expense included in the consolidated statements of operations with the income tax expense that would result from the application of the statutory federal tax rate:
| Year Ended December 31,
(in thousands) | 2023 |  | 2022 |  | 2021
Income (loss) before income taxes | $ | 105,582 |  |  | $ | 275,194 |  |  | $ | 108,459 |
Income tax expense (benefit) at federal statutory rate | 22,172 |  |  | 57,791 |  |  | 22,776 |
Net (income) loss prior to Business Combination - non taxable | — |  |  | (46,051) |  |  | (22,776) |
Impact of prior tax returns | 142 |  |  | — |  |  | — |
State income taxes, net of federal benefit | 2,169 |  |  | 1,110 |  |  | — |
Income tax expense | $ | 24,483 |  |  | $ | 12,850 |  |  | $ | — |
Effective tax rate | 23.2 | % |  | 4.7 | % |  | 0.0 | %
Significant components of deferred tax assets and liabilities are included in the table below:
| Year Ended December 31,
(in thousands) | 2023 |  | 2022
Deferred tax assets |  |  |
Net operating loss carryforwards | $ | 13,677 |  |  | $ | 11,500 |
Disallowed interest expense carryforward | 1,335 |  |  | 56 |
Asset retirement obligation | 2,169 |  |  | 1,128 |
Other deductible temporary differences | 495 |  |  | 32 |
Total deferred tax assets | 17,676 |  |  | 12,716 |
Less: valuation allowance | — |  |  | — |
Net deferred tax assets | $ | 17,676 |  |  | $ | 12,716 |
Deferred tax liabilities |  |  |
Property, plant and equipment | $ | (88,870) |  |  | $ | (60,269) |
Unrealized derivatives | (2,795) |  |  | (2,196) |
Total deferred tax liabilities | (91,665) |  |  | (62,465) |
Net deferred tax liability | $ | (73,989) |  |  | $ | (49,749) |
As of December 31, 2023, the Company had accumulated federal net operating loss carryforward of $61.1 million, none of which are expected to expire, and state net operating loss carryforwards of approximately $61.1 million in states that allow net operating loss carryforward, some of which begin to expire in 2042. Utilization of these net operating losses may be limited if there were to be an ownership change as defined by Section 382 of the U.S. Internal Revenue Code. As of December 31, 2023, the Company does not believe any of its net operating losses were limited under these rules. The Company is subject to the various taxing jurisdictions in the United States, including federal and certain state jurisdictions. As of December 31, 2023, the Company has no current tax years under audit. The Company remains subject to examination for federal income taxes for tax years 2020 through 2023 and state income taxes for tax years 2019 through 2023. The Company has evaluated all tax positions for which the statute of limitations remains open and believes that the material positions taken would more likely than not be sustained upon examination. Therefore, as of December 31, 2023 and 2022, the Company had no unrecognized tax benefits and did not recognize any interest or penalties during those respective periods related to unrecognized tax benefits. On August 16, 2022, the Inflation Reduction Act (the "IRA") was enacted into law and includes significant changes related to tax, climate change, energy and health care. The provisions within the IRA, among other things, include (i) a new 15% corporate alternative minimum tax on certain large corporations, (ii) a new nondeductible 1% excise tax on the value of certain stock that a company repurchases, and (iii) various tax incentives for energy and climate initiatives. Each of these provisions are effective for tax years beginning after December 31, 2022. The Department of the Treasury is expected to continue to publish regulations relevant to many aspects of the IRA. In addition to no 2023 impact on income tax expense, the Company currently does not believe that there will be a material impact on its cash taxes or income tax expense for the 2024 tax year or future periods but will continue to monitor.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 946 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480990/946-20-50-13 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(h)(2)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//740/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 14 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-14 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-21 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 270 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482526/740-270-50-1 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 17 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482685/740-10-50-17 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SAB TOPIC 6.I.5.Q1) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 11.C) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 740 -SubTopic 30 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482603/740-30-50-2 + Details
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