PROPERTY AND EQUIPMENT

6 Months Ended

Jun. 30, 2023

Property, Plant and Equipment [Abstract]

Property and equipment, net consisted of the following at June 30, 2023 and December 31, 2022:


$ in thousands	Estimated Useful Lives	June 30, 2023		December 31, 2022
Plant infrastructure	10 years	$	729	$	—
Miners	3 years	$	32,195	$	81,979
Miner facility infrastructure	10 years	14,661		14,203
Land	N/A	8,460		8,460
Equipment	5 years	45		45


Construction in process	N/A	19,709		18,349
Miner deposits	N/A	—		7,381
		75,799		130,417
Less: Accumulated depreciation		(4,983)		—
		$	70,816	$	130,417

Total depreciation expense was $3.2 million and $4.5 million for the three months ended June 30, 2023 and 2022, respectively and $7.0 million and $8.2 million for the six months ended June 30, 2023 and 2022, respectively.

On January 30, 2023, Greenidge entered into an agreement regarding its 2021 and 2022 Master Equipment Finance Agreements with NYDIG. During the six months ended June 30, 2023, the Company transferred ownership of bitcoin mining equipment with net book value of $50.0 million and miner deposits of $7.4 million that remained accrued to Greenidge for previous purchases of mining equipment with a bitcoin miner manufacturer and the related debt was canceled pursuant to a debt settlement agreement entered into with NYDIG. There was no gain or loss recognized on the sales as these assets. The Company recognized a gain on the sale of assets of $1.8 million, which primarily related to the

sale of bitcoin miner manufacturer coupons, including $1.2 million that were transferred as part of the debt restructuring agreement with NYDIG.

Impairment

The Company reviews its long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. To determine recoverability of a long-lived asset, management evaluates whether the estimated future undiscounted net cash flows, based on prevailing market conditions, from the asset are less than its carrying amount. If impairment is indicated, the long-lived asset is written down to fair value. In 2023 the Company has concluded that no triggering event has occurred and no impairments of long-lived assets have been recorded for the three or six months ended of June 30, 2023.

During the three months ended June 30, 2022, as a result of the significant reduction in the price of bitcoin and increased energy prices during 2022, the Company’s results of operations, as well as income expectations, were negatively impacted resulting in the recognition of noncash impairment charges of $71.5 million to reduce the net book value of the long-lived assets to fair value.

Fair value was determined utilizing the market approach, relying on the guideline public company method. Our guideline public company method incorporates revenue and hash rate multiples from other publicly traded companies with operations and other characteristics similar to Greenidge.

The table below provides a summary of the Q2 2022 impairment by category of asset:


$ in thousands
Land	$	5,000
Plant infrastructure	24,400
Miners	20,945
Miner Facility Infrastructure	990
Equipment	190
Software	70
Coal ash impoundment	925
Construction in process	18,980
Total	$	71,500