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Related Party Transactions
 6 Months Ended
Jun. 30, 2024
Related Party Transactions [Abstract]  
RELATED PARTY TRANSACTIONS

NOTE 13 - RELATED PARTY TRANSACTIONS

 

There is one operating lease with a related party. Operating lease cost relating to this lease was $7,464 for each of the three months ended June 30, 2024 and 2023 and $14,929 for each of the six months ended June 30, 2024 and 2023. As of June 30, 2024 and December 31, 2023, the related party operating lease right of use asset was $43,061 and $75,378, respectively, and the related party operating lease liability was $44,476 and $58,134, respectively.

 

In 2023, some of the Company’s customers financed their obligations with a related party, Solar Leasing, whose CEO is also the CEO of the Company. These arrangements are similar to those with the Company’s third-party lenders. As such, Solar Leasing deducts their financing fees and remits the net amount to the Company. For the three months ended June 30, 2024 and 2023, the Company recognized $6,997,626 and $0 of revenue, net of financing fees of $3,127,622 and $0, respectively from these arrangements. For the three months ended June 30, 2024 and 2023, the Company recognized $15,810,395 and $0 of revenue, net of financing fees of $6,983,841 and $0, respectively from these arrangements. As of June 30, 2024 and December 31, 2023, the Company had $819,212 and $396,488 of accounts receivable, $784,527 and $2,415,966 of accrued expenses and $9,900 and $1,160,848 of contract liabilities due to related parties relating to these arrangements, respectively.

 

As described in Note 3, Zeo Energy Corp. entered into the TRA with the TRA Holders. As of June 30, 2024, the Company has not recorded a liability related to the tax savings it may realize from utilization of such deferred tax assets. As of June 30,2024, the total unrecorded TRA liability is approximately $48.8 million. If utilization of the deferred tax assets subject to the TRA becomes more likely than not in the future, the Company will record a liability related to the TRA which will be recognized as expense within its consolidated statements of operations.