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LEASES | 12 Months Ended
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Dec. 31, 2022
Leases [Abstract] |
LEASES | LEASES The Company determines if an arrangement is a lease at inception and whether the arrangement is classified as an operating or finance lease. At commencement of the lease, the Company records a right-of-use (“ROU”) asset and lease liability in the consolidated balance sheets based on the present value of lease payments over the term of the arrangement. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. As the Company’s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company determines its incremental borrowing rate based on publicly available data for instruments with similar characteristics, including recently issued debt, as well as other factors. Contract terms may include options to extend or terminate the lease, and when the Company deems it reasonably certain that ESS will exercise that option it is included in the ROU asset and lease liability. Operating leases will reflect lease expense on a straight-line basis, while finance leases will result in the separate presentation of interest expense on the lease liability and amortization expense of the ROU asset. ROU assets related to the Company’s operating leases are included in operating lease ROU assets, while the corresponding lease liabilities are included in current and non-current operating lease liabilities on the Company’s consolidated balance sheets. ROU assets related to the Company’s finance leases are included in other non-current assets, while the corresponding lease liabilities are included in accrued and other current liabilities and other non-current liabilities on the Company’s consolidated balance sheets. The Company does not record leases with a term of 12-months or less in the consolidated balance sheets. Short-term lease costs were immaterial for the year ended December 31, 2022. The Company leases office and manufacturing space in Wilsonville, Oregon under operating leases and printers and copiers under finance leases. Each of the operating leases provides the Company an option to renew the lease for an additional 60 months which have not been included in the operating lease obligations. Operating lease costs for the year ended December 31, 2022 were $1,483 thousand. Finance lease costs for the year ended December 31, 2022 were immaterial. As of December 31, 2022, the weighted-average remaining term for the operating leases was 2.6 years and the weighted-average discount rate was 7.5%. The weighted-average remaining term for the finance lease was 4.3 years and the weighted-average discount rate was 7.5%. As of December 31, 2022, future maturities of lease liabilities are as follows (in thousands):
| Operating Leases |  | Finance Leases
2023 | $ | 1,670 |  |  | $ | 30 |
2024 | 1,720 |  |  | 30 |
2025 | 986 |  |  | 30 |
2026 | — |  |  | 30 |
2027 | — |  |  | 6 |
Thereafter | — |  |  | — |
Total minimum lease payments | $ | 4,376 |  |  | $ | 126 |
Less imputed interest | (420) |  |  | (19) |
Total | $ | 3,956 |  |  | $ | 107 |
2021 Lease Disclosures Future minimum lease payments from the Company’s 2021 Form 10-K as filed in accordance with Leases (Topic 840) under non-cancelable operating lease agreements for the years ending December 31, are as follows (in thousands):
2022 | $ | 1,625 |
2023 | 1,670 |
2024 | 1,720 |
2025 | 983 |
Total | $ | 5,998 |
Rent expense related to operating leases recorded in accordance with Leases (Topic 840) was $1,491 thousand for the year ended December 31, 2021.
LEASES | LEASES The Company determines if an arrangement is a lease at inception and whether the arrangement is classified as an operating or finance lease. At commencement of the lease, the Company records a right-of-use (“ROU”) asset and lease liability in the consolidated balance sheets based on the present value of lease payments over the term of the arrangement. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. As the Company’s leases do not provide an implicit rate, it uses its incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. The Company determines its incremental borrowing rate based on publicly available data for instruments with similar characteristics, including recently issued debt, as well as other factors. Contract terms may include options to extend or terminate the lease, and when the Company deems it reasonably certain that ESS will exercise that option it is included in the ROU asset and lease liability. Operating leases will reflect lease expense on a straight-line basis, while finance leases will result in the separate presentation of interest expense on the lease liability and amortization expense of the ROU asset. ROU assets related to the Company’s operating leases are included in operating lease ROU assets, while the corresponding lease liabilities are included in current and non-current operating lease liabilities on the Company’s consolidated balance sheets. ROU assets related to the Company’s finance leases are included in other non-current assets, while the corresponding lease liabilities are included in accrued and other current liabilities and other non-current liabilities on the Company’s consolidated balance sheets. The Company does not record leases with a term of 12-months or less in the consolidated balance sheets. Short-term lease costs were immaterial for the year ended December 31, 2022. The Company leases office and manufacturing space in Wilsonville, Oregon under operating leases and printers and copiers under finance leases. Each of the operating leases provides the Company an option to renew the lease for an additional 60 months which have not been included in the operating lease obligations. Operating lease costs for the year ended December 31, 2022 were $1,483 thousand. Finance lease costs for the year ended December 31, 2022 were immaterial. As of December 31, 2022, the weighted-average remaining term for the operating leases was 2.6 years and the weighted-average discount rate was 7.5%. The weighted-average remaining term for the finance lease was 4.3 years and the weighted-average discount rate was 7.5%. As of December 31, 2022, future maturities of lease liabilities are as follows (in thousands):
| Operating Leases |  | Finance Leases
2023 | $ | 1,670 |  |  | $ | 30 |
2024 | 1,720 |  |  | 30 |
2025 | 986 |  |  | 30 |
2026 | — |  |  | 30 |
2027 | — |  |  | 6 |
Thereafter | — |  |  | — |
Total minimum lease payments | $ | 4,376 |  |  | $ | 126 |
Less imputed interest | (420) |  |  | (19) |
Total | $ | 3,956 |  |  | $ | 107 |
2021 Lease Disclosures Future minimum lease payments from the Company’s 2021 Form 10-K as filed in accordance with Leases (Topic 840) under non-cancelable operating lease agreements for the years ending December 31, are as follows (in thousands):
2022 | $ | 1,625 |
2023 | 1,670 |
2024 | 1,720 |
2025 | 983 |
Total | $ | 5,998 |
Rent expense related to operating leases recorded in accordance with Leases (Topic 840) was $1,491 thousand for the year ended December 31, 2021.

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- Definition The entire disclosure for finance leases of lessee. Includes, but is not limited to, description of lessee's finance lease and maturity analysis of finance lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
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- Definition The entire disclosure for operating leases of lessee. Includes, but is not limited to, description of operating lease and maturity analysis of operating lease liability. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI https://asc.fasb.org/subtopic&trid=77888251 + Details
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