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Stock-Based Compensation
 12 Months Ended
Dec. 31, 2024
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation Stock-Based Compensation
2013 Equity Incentive Plan
In July 2013, the Board of Directors approved the 2013 Equity Incentive Plan (“2013 Plan”). In March 2015, the Board of Directors authorized an additional 3,000,000 shares reserved for issuance under the 2013 Plan. An aggregate of 4,500,000 shares of common stock were reserved for issuance under the 2013 Plan plus (i) any shares that were reserved but not issued under the plan that was previously in place, and (ii) any shares subject to stock options or similar awards granted under the plan that was previously in place that expire or otherwise terminate without having been exercised in full and shares issued that are forfeited to or repurchased by the Company, with the maximum number of shares to be added to the 2013 Plan pursuant to clauses (i) and (ii) equal to 8,044,829 shares. All the remaining shares that were available for future grants under the 2013 Plan were transferred to the 2015 Equity Incentive Plan (“2015 Plan”) at the inception of the 2015 Plan.
Sunrun-VSI 2014 Equity Incentive Plan
Upon completion of the Merger, the Company may grant equity awards through the Sunrun-VSI 2014 Equity Incentive Plan (“Sunrun-VSI 2014 Plan”), which was previously called the Vivint Solar 2014 Equity Incentive Plan.
Under the Sunrun-VSI 2014 Plan, the Company could grant stock options, restricted stock, restricted stock units (“RSUs”), stock appreciation rights, performance stock units, performance shares and performance awards to its employees, directors and consultants, and its parent and subsidiary corporations’ employees and consultants.
In September 2024, the Sunrun-VSI 2014 Plan expired pursuant to its terms and as of that date no additional shares were able to be granted pursuant to such plan. All Sunrun-VSI 2014 Plan shares that were reserved but not granted have expired and are no longer available for grant under the Sunrun-VSI 2014 Plan.
2015 Equity Incentive Plan
In July 2015, the Sunrun Board approved the 2015 Plan. An aggregate of 11,400,000 shares of common stock are reserved for issuance under the 2015 Plan plus (i) any shares that were reserved but not issued under the 2013 Plan at the inception of the 2015 Plan, and (ii) any shares subject to stock options or similar awards granted under the 2008 Plan, 2013 Plan and 2014 Plan that expire or otherwise terminate without having been exercised in full and shares issued that are forfeited to or repurchased by the Company, with the maximum number of shares to be added to the 2015 Plan pursuant to clauses (i) and (ii) equal to 15,439,334 shares. The 2015 Plan provides for annual automatic increases on January 1 to the shares reserved for issuance. The automatic increase of the number of shares available for issuance under the 2015 Plan is equal to the least of 10 million shares, 4% of the outstanding shares of common stock as of the last day of the Company’s immediately preceding fiscal year or such other amount as the Board of Directors may determine. In 2023 and 2024, there were no additional shares reserved for issuance under the 2015 Plan pursuant to the automatic provision. Stock options granted to employees generally have a maximum term of ten-years and vest over a four-year period from the date of grant; 25% vest at the end of one year, and 75% vest monthly over the remaining three years. The options may include provisions permitting exercise of the option prior to full vesting. Any unvested shares shall be subject to repurchase by the Company at the original exercise price of the option in the event of a termination of an optionee’s employment prior to vesting. RSUs granted to employees generally vest over a four-year period from the date of grant; 25% vest at the end of one year, and 75% vest quarterly over the remaining three years.
Stock Options
The following table summarizes the activity for all stock options under all of the Company’s equity incentive plans for the years ended December 31, 2024 and 2023 (shares and aggregate intrinsic value in thousands):
Number of Options
Weighted
Average
Exercise Price
Weighted
Average
Remaining
Contractual Life
Aggregate
Intrinsic
Value
Outstanding at December 31, 20225,217 $16.08 5.68$58,784 
Granted
— — 
Exercised
(775)6.58 
Canceled(199)29.58 
Outstanding at December 31, 20234,243 17.19 4.8531,762 
Granted
— — 
Exercised
(669)6.55 
Canceled(67)25.76 
Outstanding at December 31, 20243,507 $19.05 4.54$3,882 
Options vested and exercisable at December 31, 20243,218 $17.92 4.30$3,882 
Options vested and expected to vest at December 31, 20243,507 $19.05 4.54$3,882 
The weighted-average grant-date fair value of stock options granted during the year ended December 31, 2024, 2023 and 2022 were $0.00, $0.00 and $17.21 per share, respectively. The total intrinsic value of the options exercised during the year ended December 31, 2024, 2023 and 2022 was $4.5 million, $10.3 million and $30.8 million, respectively. The aggregate intrinsic value is the difference of the current fair value of the stock and the exercise price for in-the-money stock options. The total fair value of options vested during the year ended December 31, 2024, 2023 and 2022 was $6.5 million, $11.8 million and $16.7 million, respectively. 
The Company estimates the fair value of stock-based awards on their grant date using the Black-Scholes option-pricing model. The Company estimates the fair value using a single-option approach and amortizes the fair value on a straight-line basis for options expected to vest. All options are amortized over the requisite service periods of the awards, which are generally the vesting periods.
The Company estimated the fair value of stock options with the following assumptions:
Year Ended December 31,
202420232022
Risk-free interest rate
N/A
N/A
 1.60% - 3.80%
Volatility
N/A
N/A
65.60% - 69.40%
Expected term (in years)
N/AN/A
6.10
Expected dividend yield
N/AN/A— %
The expected term assumptions were determined based on the average vesting terms and contractual lives of the options. The risk-free interest rate is based on the rate for a U.S. Treasury zero-coupon issue with a term that approximates the expected life of the option grant. No stock options were granted in the years ended December 31, 2024 and 2023. For stock options granted in the year ended December 31, 2022, the expected volatility was calculated based on the Company’s average historical volatilities. The Company accounts for forfeitures as they occur and, as such, reverses compensation cost previously recognized in the period the award is forfeited, for an award that is forfeited before completion of the requisite service period.
Restricted Stock Units
The following table summarizes the activity for all RSUs under all of the Company’s equity incentive plans for the years ended December 31, 2024 and 2023 (shares in thousands):
Shares
Weighted
Average Grant
Date Fair
Value
Unvested balance at December 31, 20224,542 $31.60 
Granted
7,782 19.04 
Issued
(2,835)27.11 
Canceled / forfeited(1,040)26.59 
Unvested balance at December 31, 20238,449 22.16 
Granted
9,447 13.88 
Issued
(4,079)22.03 
Canceled / forfeited(1,442)18.29 
Unvested balance at December 31, 202412,375 $16.29 

Warrants for Strategic Partners
The Company has issued warrants for up to 846,943 shares of its common stock to certain strategic partners (calculated using the respective quarter of grant's closing stock price). The exercise price of each warrant is $0.01 per share, and 13,939, 63,742 and 346,269 warrants were exercised during the years ended December 31, 2024, 2023 and 2022, respectively. During the years ended December 31, 2024, 2023 and 2022, the Company recognized stock-based compensation expense of nil, $4.3 million and $4.3 million, respectively, under time-based warrants.
Employee Stock Purchase Plan
Under the Company's 2015 Employee Stock Purchase Plan (“ESPP”) (as amended in May 2017), eligible employees are offered shares bi-annually through a 24-month offering period which encompasses four six-month purchase periods. Each purchase period begins on the first trading day on or after May 15 and November 15 of each year. Employees may purchase a limited number of shares of the Company’s common stock via regular payroll deductions at a discount of 15% of the lower of the fair market value of the Company’s common stock on the first trading date of each offering period or on the exercise date. Employees may deduct up to 15% of payroll, with a
cap of $25,000 of fair market value of shares in any calendar year and 10,000 shares per employee per purchase period. Under the ESPP, 1,000,000 shares of the Company’s common stock have been reserved for issuance to eligible employees. The ESPP provides for an automatic increase of the number of shares available for issuance under the ESPP on the first day of each fiscal year beginning on January 1, 2016, equal to the least of 5 million shares, 2% of the outstanding shares of the Company’s common stock on the last day of the immediately preceding fiscal year, or such other amount as may be determined by the Board of Directors. In 2023 and 2024, the Board of Directors did not authorize any additional shares reserved for issuance under the ESPP.
Stock-Based Compensation Expense
The Company recognized stock-based compensation expense, including ESPP expenses, in the consolidated statements of operations as follows (in thousands): 
Year Ended December 31,
202420232022
Cost of customer agreements and incentives$8,538 $8,772 $9,181 
Cost of solar energy systems and product sales
1,999 5,267 9,274 
Sales and marketing
50,741 59,026 56,857 
Research and development
9,961 1,739 2,667 
General and administration
41,586 36,977 32,654 
Total
$112,825 $111,781 $110,633 
During the years ended December 31, 2024 and 2023, stock-based compensation expense capitalized to the Company’s consolidated balance sheet was $9.9 million and $11.3 million, respectively. As of December 31, 2024 and 2023, total unrecognized compensation cost related to outstanding stock options and RSUs was $150.6 million and $146.5 million, respectively, which are expected to be recognized over a weighted-average period of 2.5 years.
401(k) Plans
    The Sunrun 401(k) Plan and the Vivint Solar 401(k) Plan are deferred salary arrangements under Section 401(k) of the Internal Revenue Code. Under both the Sunrun and Vivint Solar 401(k) Plans, participating U.S. employees may defer a portion of their pre-tax earnings, up to the IRS annual contribution limit ($23,000 for calendar year 2024). Under the Sunrun 401(k) Plan, the Company matches 100% of the first 1% and 50% of the next 5% of each employee's contributions. Under the Vivint Solar 401(k) Plan, the Company matches 33% of each employee's contributions up to a maximum of 6% of the employee’s eligible earnings. The Company recognized expense of $21.1 million, $22.7 million and $21.5 million in the years ended December 31, 2024, 2023 and 2022, respectively.