Clean Energy Fuels Q2 2025 Earnings Report

Clean Energy Fuels EPS Results

• Actual EPS: -$0.01
• Consensus EPS: -$0.07
• Beat/Miss: Beat by +$0.06
• One Year Ago EPS: $0.01

Clean Energy Fuels Revenue Results

• Actual Revenue: $102.61 million
• Expected Revenue: $94.73 million
• Beat/Miss: Beat by +$7.88 million
• YoY Revenue Growth: +4.80%

Clean Energy Fuels Announcement Details

• Quarter: Q2 2025
• Date: 8/7/2025
• Time: After Market Closes
• Conference Call Date: Thursday, August 7, 2025
• Conference Call Time: 4:30PM ET

Clean Energy Fuels (NASDAQ:CLNE) provides natural gas as alternative fuels for vehicle fleets and related fueling solutions in the United States and Canada. It supplies renewable natural gas (RNG), compressed natural gas (CNG), and liquefied natural gas (LNG) for medium and heavy-duty vehicles; and offers operation and maintenance services for public and private vehicle fleet customer stations. The company also designs, builds, operates, and maintains vehicle fueling stations; and sells and services compressors and other equipment that are used in RNG production and fueling stations. In addition, it transports and sells CNG, RNG, and LNG through virtual natural gas pipelines and interconnects; sells U.S. federal, state, and local government credits, such as RNG as a vehicle fuel, including Renewable Identification Numbers and Low Carbon Fuel Standards credits; and obtains federal, state, and local credits, grants, and incentives. Further, the company focuses on developing, owning, and operating dairy and other livestock waste RNG projects. It serves heavy-duty trucking, airports, refuse, public transit, industrial, and institutional energy users, as well as government fleets. Clean Energy Fuels Corp. was incorporated in 2001 and is headquartered in Newport Beach, California.

Clean Energy Fuels Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Clean Energy reported Q2 revenue of $102 million, 61 million gallons of RNG sold and $17.5 million of adjusted EBITDA with $241 million in cash, and raised its full-year 2025 guidance above prior highs.
• Positive Sentiment: The company now fuels over 9,000 transit buses daily at 115 locations, leveraging its unmatched RNG supply network to win contracts based on reliability, emissions reductions and cost savings.
• Positive Sentiment: Clean Energy remains bullish on heavy-duty truck adoption of RNG, noting Freightliner’s X15N engine entry and up to $2 /gal fuel savings that attract carriers and shippers.
• Negative Sentiment: Six dairy RNG plants are operating with two large projects in Texas and Idaho set to commission by year-end, but ongoing ramp-up delays and startup losses require corrective actions to hit production targets.
• Positive Sentiment: The IRA’s 45Z production tax credit now formally recognizes negative-emission dairy RNG, and guidance from Treasury expected this fall should further improve project economics.

Presentation

[Operator]

Please note this call is being recorded and that I will be standing by should you need any assistance. It is now my pleasure to turn today's program over to Robert Friedland, CFO.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Thank you, operator. Earlier this afternoon, Clean Energy released financial results for the second quarter ending 06/30/2025. If you did not receive the release, it is available on the Investor Relations section of the company's Web site at www.cleanenergyfuels.com where the call is also being webcast. There will be a replay available on the Web site for thirty days. Before we begin, we'd like to remind you that some of the information contained in the news release and on this conference call contains forward looking statements that involve risks, uncertainties and assumptions that are difficult to predict.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Such forward looking statements are not a guarantee of performance and the company's actual results could differ materially from those contained in such statements. Several factors that could cause or contribute to such differences are described in detail in the Risk Factors section of the Clean Energy's Form 10 Q filed today. These forward looking statements speak only as of date of this release. Company undertakes no obligation to publicly update any forward looking statements or supply new information regarding the circumstances after the date of this release. The company's non GAAP EPS and adjusted EBITDA will be reviewed on this call and exclude certain expenses that the company's management does not believe are indicative of the company's core business operating results.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Non GAAP financial measures should be considered in addition to results prepared in accordance with GAAP and should not be considered as a substitute for or superior to GAAP results. The directly comparable GAAP information, reasons why management uses non GAAP information, a definition of non GAAP EPS and adjusted EBITDA and a reconciliation between these non GAAP and GAAP figures is provided in the company's press release, which has been furnished to the SEC on Form eight ks today. With that, I will turn the call over to our President and Chief Executive Officer, Andrew Littlefair.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Thank you, Bob. I'm pleased to say that the second quarter of this year again demonstrated the underlying strength of our overall business. Despite the continued shifting regulatory atmosphere, uncertainty around tariffs and other external distractions in the market, we posted a very solid performance with 102,000,000 of revenue, over 61,000,000 gallons of renewable natural gas sold, dollars 17,500,000.0 of adjusted EBITDA for the quarter. And with $241,000,000 in cash and other investments, we remain on solid financial footing. I will keep my remarks on the short side today and let the results speak for themselves. But I do wanna give a little color to emphasize my previous point about the strength of our fundamental business, which is allowing us to update our projections for our 2025 financials.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Bob will be giving you the details, but suffice to say, we believe we will be exceeding even the high end of our original guidance. We distributed a press release last week that highlighted a number of deals that we have made over the last several months with transit agencies across the country. We signed our first transit agreement over twenty five years ago. And since that time, we have continued to steadily grow this business. Today, we fuel over 9,000 transit buses every day at a 115 locations.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

This is due to several factors. Buses equipped with natural gas engines are not only reliable in tough conditions, but they are clean and quiet. Operators very much appreciate their dependability. Cities like that the buses dramatically reduce harmful NOx pollutants and passengers appreciate they don't smell diesel fumes as they ride along. Also, more and more transit agencies are seeing the double benefit of carbon emissions reductions plus cost savings by converting their fleets from traditional CNG to RNG.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

With almost a 100 different RNG supply contracts, no other company can ensure a steady flow of this clean fuel like clean energy, which is why we are winning so many contracts. Like the transit market, our business with waste companies is consistent and growing. As the recognized leader in the alternative fuel space, we can expand existing relationships with refuse companies and win new deals. Once more by the assurance of a steady supply of RNG as these companies expand their natural gas fleets. Continue to be bullish on the heavy duty truck markets adoption of RNG.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

While we as well as Cummins acknowledge that the sales of trucks equipped with their new X15N engine aren't where we had hoped they would be at this point. There are signs that continue to point in the right direction. Between the change in administrations in Washington and the evolving regulatory atmosphere in California, all truck sales have been hit hard while operators wait for more clarity. Fortunately, that clarity is beginning to emerge. There is an acknowledgment during our discussions with both carriers and shippers that they want to continue to look at ways to reduce harmful scope one and scope three emissions.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

One of the most promising recent policy changes is that these fleets no longer are forced to consider only one technology and one that is too costly and still unproven. That along with other developments like market leader Freightliner recently offering the X15N option is why we remain bullish. Trucking companies continue to engage with us as they evaluate the RNG solution. Price still wins the day in the highly competitive logistics business. Fortunately, it is easy to get the fleets attention when they are presented with up to a $2 a gallon savings on fuel.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

I'll end my remarks with a quick report about the progress we have made in our RNG development business. In the relatively short time since launching our dairy RNG production business, we now have six dairy projects operating with another large project in Texas in commissioning and our largest project in Idaho completing an important pipeline extension and nearing mechanical completion. Both the Texas and Idaho projects are on schedule to begin producing RNG by the end of the year. Additionally, the dairy RNG projects that we are developing with Moss Energy have begun construction. Using our own RNG allows us to capture a greater percentage of the overall value of the fuel, not only at the pump with environmental credits, but also through the monetization of the investment tax credit.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

We recently announced $29,000,000 ITC sale in connection with four projects owned by our RNG joint venture with BP. Area RNG emission rates for the 45Z production tax credit are in the process of being finalized. We are pleased with the recognition of negative emission manure feedstock RNG in the One Big Beautiful Bill Act. This legislation allows the US Treasury to recognize the full benefit of dairy RNG, which involves capturing carbon emissions from dairy cow manure and converting them into productive use as a negative emissions highway transportation fuel. Let me close with saying that we continue to feel very good about the way our businesses are performing, both the upstream and downstream to put it in the old energy business vernacular.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Fleets like transit agencies and waste companies that have been operating natural gas buses and trucks for decades are seeing a revitalization with the added environmental and financial benefits of migrating from CNG to RNG. And the relatively new market of heavy duty trucking is slowly but surely starting to see the light. Clean energy is well positioned to continue to lead the exciting RNG space with a growing portfolio of production facilities, the largest supply of RNG, the most expansive fueling network, and a talented group of people. And with that, I will hand the call back to Bob.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Thank you, Andrew, and good afternoon to everyone. The 2025 was another good quarter. We saw increases in revenues and RNG volumes compared to last year's second quarter. Also keep in mind, the revenues last year included $6,000,000 of alternative fuel tax credit revenue, which expired for 2025. Our second quarter RNG volumes grew 21% compared to our 2025.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

And now this bounce back was anticipated after the first quarter RNG production challenges due to unusually cold weather. Our operating cash generation in the 2025 increased over last year and over our 2025. As Andrew noted that we ended June with $241,000,000 in cash and investments, which is up from $217,000,000 that we had at the beginning of the year. It puts us in a very good place relative to our anticipated CapEx and other spend on our dairy projects. Looking at our net results, our GAAP net loss for the 2025 was $20,200,000 compared to $16,300,000 a year ago.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

But the results of the 2024 benefited from the $6,000,000 alternative fuel tax credit revenue as well the second quarter last year, if you recall, had two quarters of LCFS revenues, which was an extra $2,200,000 that was in last year's second quarter. Adjusted EBITDA a year ago, second quarter was $18,900,000 versus $17,500,000 in 2025. But if you consider 2024, of course, had this $8,200,000 of non comparable income, you can see that 2025 has significantly improved over 2024. The improvement is principally the result of higher fuel volumes from both RNG and conventional natural gas. Together with favorable pricing and cost mix in 2025 versus a year ago.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

In fact, the higher RNG volumes in 2025 compared to last year helped to mitigate much of the lower RIN pricing in 2025 versus a year ago. Now looking at our trend from the 2025, where adjusted EBITDA was 17,100,000 versus our 17.5 in the second quarter, we did see very good benefits of the higher RNG volumes in the second quarter with a 77% increase in RIN revenue. Our LCFS revenue though was lower in the second quarter, mainly due to a 20% drop in LCFS prices since the first quarter. And we saw a drop in our base fuel margins on normal fluctuating fuel pricing mix and commodity cost mix. The net of all that basically resulted in a relatively flat volume related product margin between Q1 and 2025.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

We did see improvements in our construction and service margins in the 2025, which helped bring our second quarter results slightly above those of the first quarter. The RNG dairy front, the losses from our upstream dairy RNG projects were about the same in the second quarter compared to the first quarter. The losses at this stage reflect the fact that five of our six operating dairy projects are in ramp up mode, plus we have operating expenses in Idaho that we've talked about before. Our dairy project in Del Rio, Texas is producing positive EBITDA and steadily increasing its RNG production. We were anticipating producing more RNG revenue at this stage from the five projects in ramp up mode, and we are taking corrective action to address those five projects as they ramp up.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

And we feel confident about being able to increase our r and d production volumes at those locations similar to what we did in Texas with Del Rio. Although we have tempered our 2025 outlook on the on the dairy projects based on where we are through June. Lastly, considering our results through June 2025, we are raising our guidance for the full year 2025 for both our GAAP earnings and non GAAP adjusted EBITDA. You can find details in our press release, but at high level, our GAAP guidance for 2025 is now for a net loss ranging from $217,000,000 to $212,000,000 and our outlook for adjusted EBITDA for 2025 is now $60,000,000 to $65,000,000 Our new guidance reflects the trends we've seen in our results thus far with anticipation that these trends will largely continue, but with caution recognizing there are ongoing uncertainties still in play, particularly for us around the timing of adoption of the X15 in, REN and LCFS pricing and ongoing ramp up in our dairy projects. That is my report.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

With that operator, we can open the call to questions.

[Operator]

Thank And our first question will come from Eric Stine with Craig Hallum. Please go ahead.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Hi, Hi, Bob.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Hi, Eric.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Hey. So I guess I'll start maybe with the 45 z. Obviously, great that it was included in the bill.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

And I know waiting on treasury, you know, just curious kinda what your what your updated thoughts are on what that potentially could mean for you, I guess, in the near term if you apply it well, I mean, gallon, but if you apply it to what where your upstream is at now and, you know, maybe where you think it is two to three years from now.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

You know, Eric, I'm not gonna get into a, you know, kind of a guessing on how many dollars per gallon and all that kind of thing. But look, I think the bill was very strong. Right? As you as you well know, it not only got included, it got strengthened and it got extended. And and specifically is enabled, to recognize the the negative carbon and instructs the treasury secretary to take into account the negative carbon.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

So, I mean, I feel very, bullish about how that should impact. And I think you should get, you know, a a very good carbon intensity score, which should end up being on, you know, the higher end of way people have looked at this. So I think it should be meaningful for us going forward. But there's time, you know, there's still a lot of a lot to to work through, but, feel like we're well positioned because because the legislation itself enables and recognizes it.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Right. Well, I guess I'm gonna ask you to potentially guess again, but the I mean, timing, I I know that when you're looking at treasury guidance, it can be very tricky, to call that. But, I mean, is it is it something that you have any insight into or anything you're hearing?

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Well, you know, Eric, it doesn't really kick into effect till January. Till January. So, you know Right. You know, we're kinda back in that where, you know, there's a lot of things that treasure on treasury's plate. I know they're working on this now, and I know other agencies and other departments that have input are engaged.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

So that's good. But I don't know that, you know, they're under a dead rush to get this done. They know that it it doesn't really get put into play until January. So I'm guessing in sometime in the in the fall, you know, you'll you'll see it in and I do would just be a guessing October, November, something like that. It probably get sorted out.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Right. Right. No. I appreciate that. Alright.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Maybe just turn into the the x 15 n, you know, obviously, as you said, I mean, it's certainly not to where I think it had been envisioned a couple years ago or when things started for Cummins. But, you know, the one thing I've heard is is just incremental cost as being a big deterrent for what PACCAR has had in the market for a year plus. Any thoughts or what you're hearing? I know it's early for Freightliner, but incremental cost having another OEM in the market, what type of impact? Again, I know it's early, but just curious what you're hearing.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

No. It's it's good. And, you know, we continue our sales team continues to work with on what I've said on a couple of calls is that in for 2025, we wanted to see an increase in the breadth of, you know, the x 15 and orders across the the heavy duty space. And I believe we're seeing that. You know, what we've said, Eric, we I think you and I have talked about is it Cummins felt strongly.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

It's not about just some one big order with one fleet that you needed in order to build a market, really needed to have acceptance across. And I believe we're seeing that. And they're smaller numbers, but it's it's more breadth. The orders are taking place quotes, quotes, for pricing are is underway. You know, the the, Freightliner coming into the market has been very helpful.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

The incremental cost, I think has been a little bit of a stumbling block in their early introduction certainly at the end of last year and first part of this year. But we've seen some of our channel partners and the industry really pull together. OEMs, Cummins, you know, ourselves and others have worked hard to bring the incremental price down. And that has happened. And so once upon a time when you'd see, you know, incremental pricing in the in the $100,000 or even greater range, you've now seen that come substantially down something closer around 75,000.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

That that's important, Eric, because it gets you to where with a hour advantageous fuel pricing is it can get you the end of that very important two two year type payback for the incremental cost. And that is that begins then to really sing for fleets. So it you know, the the engines have performed beautifully. The really, the the test and the early adopters, I mean, that has gone well. And now that we're able to get this this incremental pricing down, I'm feeling much better about the way the introduction will go.

[Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC]

Okay. Thanks a lot. Yep.

[Operator]

Thank you. Our next question will come from Rob Brown with Lake Street Capital Markets. Please go ahead.

[Rob Brown, Senior Research Analyst, Founding Partner & Chief Strategy Officer at Lake Street Capital Markets]

Hi, Andrew and Bob.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Hi.

[Rob Brown, Senior Research Analyst, Founding Partner & Chief Strategy Officer at Lake Street Capital Markets]

Hey, Rob. I wanna dig in a little more on the the ramp on the dairy projects that are that are ramping and the things you're doing. Could you give us some more color on kinda what you're doing and how long you think that can kinda take to ramp things up?

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

I would say, then, you know, Anne, you have fun. I mean, I would say it's kinda normal. You know, after after commissioning and placing these things into service, we are, kinda taking care of kinda normal, I would say normal type punch list items that are I mean, they're extensive, but we know what's going on. And I mean, they're very operational. So you're looking at manure flow and all the different equipment that's out there.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

I might think what the encouraging part for us is that there's nothing there you know, that we're seeing that indicates that there's a showstopper of any kind. I mean, we were able to get the the Del Rio, Texas, dairy up, but it takes some time. So, you know, you you never know. Sometimes it's a quick fix and there you go and or it can take a little time. But so I think we'll be at it, you know, kinda going through this year on this ramp up and correcting them and but it shouldn't go much beyond.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

I mean, we should, you know, start hitting the ground running a bit more going into next year for sure.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

You know, I Eric is kinda hard to all these different phases. Oh, Rob. I'm sorry. Rob, it's kinda kinda hard, you know, all these different phases on these things. But I would sort of say, you know, when we when we often the business or at least in our business, we used to think about commissioning is something that was very defined.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Right? It was like two weeks to when we commission a fueling station, that's kinda how long it takes. And I would say here the commissioning is is a little bit more varied. And it's it's it's more in the scheme of six months, you know, realistically when by the time you bring them on and you start you really debug and improve and enhance, these these dairies. And it's it's more on that on that order.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

So I think Bob's exactly right. Toward the end of this this year, you'll be getting much, you know, much improved run rates. That's something much closer to nameplate whereas right now, you know, you're just put there.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Just to be clear, we are reducing RNG volume and, you know, monetizing what we can. So these are operating and you just have to kinda deal with some of the nuances of, you know, it's I mean, it's it's biology, you know. So we we know what we're up against there, but we we have good team and good experience and, you know, so it'll it'll get there. It was just a little, maybe a little slower than we anticipated.

[Rob Brown, Senior Research Analyst, Founding Partner & Chief Strategy Officer at Lake Street Capital Markets]

Okay, great. Thank you. And then in the market demand, think you talked a little bit about some regulatory clarity starting in the market. But you just kinda update, where that's at and and maybe the the point at which customers get more more kind of clarity and comfort, that they can make decision.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Yeah. And, you know, in my remarks, it it, I don't I don't want it to you know, there there are some macro issues here. It's not all about all the introduction of, you know, cleaner trucks. You know, the the trucking industry sales of new trucks in America is is off significantly. And, you know, with tariffs and and, you know, supply chain and and inflation and turns at the ports.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

I mean, we've really seen the the trucking market has had a very tough year. And the acquisition of new equipment has been something is I don't know. It's been off 50%. Then you lay on top of it, what's happened in California because of the regulations, you know, which were requiring, you know, an electric truck in order to buy other trucks. That'll all but shut down the acquisition of new trucks in California.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

And I think the new truck sales in California were are off something on the order of 75%. And now as you know, as I I speak of the vision, you're beginning to see more clarity in California, the Trump administration, got rid of the waivers, or didn't approve the waivers on the ACT and the ACF fleet rule. And, that still, we haven't seen, you know, total clarity yet on how that's all gonna come to rest and and what what may be happen in California. But that's beginning to take care of itself. CARB said a couple of hearings and it's expected that there's gonna be some new recommendations to the governor of just how to sort out the clean truck fuels, you know, program in California.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

So I think, or or here over the next couple months, we should get a little bit more clarity there. And hopefully, truck sales will begin to. And we also hope that low knock trucks will get a nod in that in that program as well, which would be very important for RNG going forward. But through all of this, what is heartening is that a lot of our trucking customers and shippers are still wanting, are still interested, still believe that they need to field sustainable equipment. And so that's good.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

And and yet, I would say, you know, common sense and economics are are prevailing right now. And so it's gotta make economic sense. And and again, this is a little bit of good news for us, Rob, because we we can price our fuel and get them, savings on every, mile traveled. So been a little slower on the adoption, but I think it has as much to do with sort of macro issues in the the in the industry as it does in specifically with the x 15 n.

[Rob Brown, Senior Research Analyst, Founding Partner & Chief Strategy Officer at Lake Street Capital Markets]

Okay, great. Thanks. Congratulations on all the progress. I'll turn it over. Thank you.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Thank you, Rob.

[Operator]

Thank you. Our next question will come from Derek Whitfield with Texas Capital. Please go ahead.

[Derrick Whitfield, Managing Director at Texas Capital]

Good afternoon guys and thanks for taking my questions.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Hi Derek.

[Derrick Whitfield, Managing Director at Texas Capital]

I wanted to start on guidance first. Could you perhaps add some color around what's driving this re rate and growth and success you're seeing and dispensing in your view? And then separately, to what degree has that been communicated in public comment in the public comment period for the set two rule because that clearly has demand implications and we know when generation was was quite strong in May and June. Again, we'd love your thoughts on those topics.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Yeah. Derek, I'll start on the what we're seeing there. I mean, think we're definitely seeing continued strong volume. That's it's been a little choppy because q one was a little off, but then we kinda came back and rebounded there in q two. I think in general, we've also seen just a good mix of more vehicles within the kind of the our pool of customers and whatnot, just more vehicles at our stations And fueling volumes at our stations will drive economics.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

So you're getting you're getting kind of a a better margin per gallon if you will, which is we work. Were cautious on that. There's a lot that can go into it between RINs and LCFS as well as even the spread on oil to nat gas. Right. And so far all of that put together hasn't all fired on all cylinders all the way.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

You know, for example, this past quarter, LCFS was down, but but we had, you know, tremendous REN volume and so that helped. But all that has been, you know, collectively going in our favor. And while we still remain somewhat cautious, basically, we do see that some underlying trend on that will continue. We don't see that kinda dropping off, you know, just between kinda oil and and natural gas, even within the rent LCFS. We've already baked in.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

We kinda know that, you know, we've seen the trend there. So that's part of why we see this back half could be, you know, you could have a little headwind because the environmental credits are down. So I know you're going on the second part of the question was, well, this I couldn't this well, this this, you know, kind of better than expected and then demand and then yet, you know, on the, you know, on the EPA and I think you're going down the RVO is like, you know, how is that not factored in, you know, to, you know, to RVO? And because there's been comment out there that they didn't consider the Well,

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

I I you know, look, we we there's a comment period right now in the RVO. I think it is generally a little the RVO is a little light. But let's not overemphasize this in the in our in in our business. I mean, it's an important piece, but it's not the entire piece. And while I think they got it a bit light, you know, I've been at this a long time.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

We all have here. The EPA struggled to come up with with the right methodology on RVOs over the sky. So we're we're gonna we're gonna give them some of our insight on demand growth, x 15 and growth, and the kinds of customers that we see that are interested and, you know, some who who knows how that will go? But, I I feel like, you know, the RVO, you know, it's it's somewhat constructive and it should keep the pricing in about this range, which is fine for our business.

[Derrick Whitfield, Managing Director at Texas Capital]

Yeah. It makes complete sense. And then maybe just focusing in on downstream, I wanted to ask for your thoughts on some of the recent dispensing transactions that have been announced with Trillium and Apollo, which are seemingly rerating the value of downstream and also highlighting at the same time the growing disconnect between your stocks and the markets.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Well, I don't know. You're gonna have to help me there on what you're seeing on that because I don't I don't know that I've have conclusions on on that and on the pricing of that. What what are you seeing there?

[Derrick Whitfield, Managing Director at Texas Capital]

Sure. We're seeing since COVID potential two x increase in the value of downstream, which could put those assets on a near 10 x multiple basis based on our math. When we look at kind of what's implied in your business today, very little value for or not that level of rep value recognition for the downstream. So that was kind of the comment and thought process beyond that. Mhmm.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Yeah. Well, that would imply that we were, you know, undervalued. Yeah. I know. That's probably right.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Yeah. I mean, I I think perhaps in general, we're you know, we we like to see those kinds of transactions in the space that basically supports the valuation and a higher valuation for us. Why it doesn't translate to us is, you know, look. I I still think, you know, actions speak louder than words, and you still wanna see, you know, significant x 15 in adoption and growth, and you see that in our numbers. So, you know, we're kinda set up for prime time on that. We're also a bit larger, you know,

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

the Yeah.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

I mean, I guess it it sort of validate. You know, I've long believed, in fact, we've talked to some significant players in the business. I mean, in order to replicate our debt downstream, it would it would be $2,000,000,000, 2 and a half billion dollars to do it today and and a decade. So we're well positioned with a a a network that would be and I have to be you know, I'm an optimist, but I'm I happen to believe that over time, you know, the the experience one of the reason we're doing well right now is we have our Amazon stations are doing well. Right?

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

We proved out that large deployments of trucks, it can work and that RNG can can can work well. And so we have a lots of, unutilized capacity at our downstream. That's super well positioned. It's you know, we we have these truck stops up and down every interstate, system in the nation. And so as this demand begins to develop, we're gonna get we get a disproportionate amount of downstream.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Today, we're we're it's most markets. We're about 50 or 60% of the market market share. So, you know, that's why we work so hard on the demand side of this equation. And now that we have the right product, the x 15 n, we've got the right kinds of fleets. You know, all the largest fleets in America are testing or buying some of these these x fifteens.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Now we need them to do it in greater numbers, of course, but I like to where we're headed.

[Derrick Whitfield, Managing Director at Texas Capital]

Great color. Thanks, guys.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Mhmm.

[Operator]

Thank you. Our next question will come from Manav Gupta with UBS. Please go ahead.

[Manav Gupta, Executive Director at UBS Group]

Congrats, guys. Excellent result and a raise of the guide. I just wondered your outlook on the LCFS price. You did mention, you know, our view was a little light. I I I agree with the light for your on the d three side, but the LCFS, developments are positive.

[Manav Gupta, Executive Director at UBS Group]

And I'm just trying to understand how are you thinking about the LCFS prices, you know, exiting 2025.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Manav, I think it's good because we haven't talked about that enough. I think that the new rules for the LCFS and the new, you know, the finally, that those got into place is that that should be constructive over time. We'll begin to work off of the we'll begin to work over the oversupply in the bank. And it'll it won't doesn't happen overnight as you know, but it'll it'll be the case that it'll begin it's beginning already. And you'll have a firming pride throughout the remainder of this year and into next year, and it'll continue to go up. So, I like where the LCFS is headed.

[Manav Gupta, Executive Director at UBS Group]

Perfect. Thank you. That's what we was hoping for. And then, you know, the investment tax credits are a big benefit. You can monetize them.

[Manav Gupta, Executive Director at UBS Group]

Given your CapEx spend and other things, how should we think about, you know, the benefit of this into, like, next year? Like, what could be a good number? I know it's little bit of a guess, but what could be a good number for investment tax credits that you could monetize if if you're thinking about next year or even the second half of this year?

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Well, let's see. Manav, okay. So we've we've monetized the investment tax credit on on all of our projects that have been placed into operations. And really, that money is being utilized in the JV. Right?

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

So it's it's so we've seen that. So what we have really are, you know, couple projects under construction. It's a big one in Idaho, one in South Forest, Texas, and then we have our Moss Energy deals. And, you know, all those, it's I don't wanna speculate on what that would be. I mean, we're those are you know, the dollars involved are pretty are pretty large, particularly in Idaho and others.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

But I guess generally, how we're viewing that is that it provides us a nice inflow of capital to take down our kind of net capital outlay on those. And you know, so it, you know, helps the return, if you will. But, anyway, know, we kinda use it. Yeah.

[Manav Gupta, Executive Director at UBS Group]

No. Thank you. That's very clear. As long as you're basically clarifying that there are large investments particularly associated with Idaho project, eventually, we'll be able to get back in the cash free. Thank you so much for the response.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

I guess the other thing is on one of those, we own a 100%. Right? So that Yeah.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

There is the one in Texas, we own a 100%.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

So we're not splitting the ITC with a partner on that one. Gonna get all of that.

[Operator]

Thank you. Our next question will come from Matthew Blair with TPH. Please go ahead.

[Matthew Blair, MD - Refiners, Chemicals & Renewable Fuels Research at TPH&Co]

Thank you and good afternoon. Are you seeing signs of incremental tightness in the downstream C and D refueling market? And if so, are there any examples you can share? So for example, when you recontract an existing fleet, is that coming in at a higher rate due to incremental tightness? And and I guess the reason I ask is because your baseline fueling margin, excluding the RIM and LCFS credit revenue, really seems to have taken a step up here.

[Matthew Blair, MD - Refiners, Chemicals & Renewable Fuels Research at TPH&Co]

And so we're just trying to find a better understanding of why that is. Thank you.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

I don't know that we're seeing a tightening there. I think you're seeing, well, I mean, you're seeing, there's a, yeah, I mean, you're just seeing kind of more fueling. What what impacts that base margin is is, you know, the the volume at our stations. And as we grow our customers that are just kinda pure, you know, trucking, fueling at our stations, you know, I mean, as an example, our Amazon stations are purpose built. You know, they hadn't been, you know, they haven't been fully there for, you know, this year, of course, and most maybe most of last year.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

But as we continue to our fleets continue to grow, our customer fleets continue to grow. And so the shift is really toward kind of fuel volumes and fueling at our stations. And so you're starting, that is what drives that base margin, you know, and as well, just the the spread, you know, kinda oil, the nat gas has been has been good and and Good. You know, we make money at this, you know, with volume. You do you do make some money.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Certainly, there's margin there with that spread. I mean, the spread, I think I looked again today was, you know, twenty one twenty one. Times, you know, kind of WTI to to NYMEX. So we met, you know, that's kind of it. Matthew is not a there's not any complicated deal. It's just, mix of fuel volume at our stations.

[Matthew Blair, MD - Refiners, Chemicals & Renewable Fuels Research at TPH&Co]

Sounds good. And then congrats on raising the guide. I think even at the top end of the guide, it would imply that the back half of the year would be a little bit softer than the first half. Could you help us understand the moving parts there? Is that just a function of trying to be a little cautious given lower RIN prices or is there some seasonality at play? You know, what what would determine that?

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Just just general caution. Like I said in my comments, you know, vehicle adoption, know, what's going out there, the vehicles, you know, in terms of what's being purchased, all of that. Then LCFS, there's volatility there. We've got we're ramping up those. So our our base underlying as we were just talking about kind of the base underlying and fueling in that where those those are the trends that we kinda largely said, you know, you would see those continue. But there's other, you know, just caution there. Yeah.

[Matthew Blair, MD - Refiners, Chemicals & Renewable Fuels Research at TPH&Co]

Great. Thank you.

[Operator]

Thank you. Our next question will come from Patty Zhang with Scotiabank. Please go ahead.

[Betty Zhang, Associate Director - Equity Research at Scotiabank]

Hello. Thank you. I wanted to ask hi. So in the updated guidance, I I noticed that the expected Amazon warrant charges for the year is higher. Does this reflect more fueling demand from Amazon?

[Betty Zhang, Associate Director - Equity Research at Scotiabank]

And are you seeing similarly more interest in demand from other trucking customers?

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Betty, it does.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

From what was from what was in the previous guidance,

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

that's correct.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

Now are we seeing other yes. As Yes. Expand? Yeah. We are, but, you know, not the silver bullet.

[Robert Vreeland, Chief Financial Officer at Clean Energy Fuels]

I mean, look. We're you know, the x 15 n is is still a bit of a question. So

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

No. But I think, Betty, you've got it right. You you figured out what you're looking at there on Amazon. So that volumes up and and the guidance also expects that there'll be increased volume from trucking. I'd like a lot more, you know, and we we hope that'll be the case.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

But, you know, I think that's just kinda we're we're being a little cautious, but, yes, you're seeing the increase.

[Betty Zhang, Associate Director - Equity Research at Scotiabank]

Got it. Makes sense. And then I was wondering if you could, just provide an update on, your RNG projects under construction.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Well, as we said on our, you know, kinda went over pretty fast, but, know, six projects are completed. Right? And they're in kind of debugging stage as we talked about. And Betty, don't know if you were on that part of the call, but you know, they're they're in the ramp up phase and that's that commissioning. I've sort of said that's feels like that that's could take six months rather than it's not it's not all done in two weeks.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Okay. So those are in play. We have expectation that they'll be sort of on a similar track to what we saw with Del Rio, has done, very well. The next two big projects that we have under construction, we're really feeling good about South Fork Texas dairy. You know, that's a 100% owned by us.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

And that's really gone, I think very well to this point, right? It's kind of an on time and on budget. We're in the commissioning say, we've actually loaded manure into those tanks. You know, there's there's a lot more to be done there, but that that that one's coming along nicely. And then our final our large project, a really big project in Idaho.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

We've had some substantial, you know, milestone completions there. We completed the 11 mile pipeline. We are we're testing and filling up and some of the big digesters. It's a very impressive project there. And so that will soon go into more formal, commissioning.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

And we expect both those projects to be kind of on the beginning of, you know, production latter part of this year. So we feel good about that. And then we have, three moss, projects at six at six dairies. Let's call it that six dairies that have really three projects. Those are all under construction.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

And just just beginning, you know, but those are all underway. That's kinda where we stand right now.

[Betty Zhang, Associate Director - Equity Research at Scotiabank]

Perfect. Thank you.

[Operator]

Thank you. And at this time, we have no further questions in the queue. So I'd like to turn the call back over to Andrew Littlefair for any additional or closing remarks.

[Andrew Littlefair, President, CEO & Director at Clean Energy Fuels]

Thank you. Thank you, operator, and thank you, everyone, joining us today, and we look forward to filling you in next quarter. Have a good day.

[Operator]

Thank you, ladies and gentlemen. This concludes today's presentation, and we appreciate your participation. You may disconnect at any time.

Participants

Executives

• Robert Vreeland, Chief Financial Officer
• Andrew Littlefair, President, CEO & Director

Analysts

• Eric Stine, Senior Research Analyst at Craig-Hallum Capital Group LLC
• Rob Brown, Senior Research Analyst, Founding Partner & Chief Strategy Officer at Lake Street Capital Markets
• Derrick Whitfield, Managing Director at Texas Capital
• Manav Gupta, Executive Director at UBS Group
• Matthew Blair, MD - Refiners, Chemicals & Renewable Fuels Research at TPH&Co
• Betty Zhang, Associate Director - Equity Research at Scotiabank