OPAL Fuels Q1 2026 Earnings Report

OPAL Fuels EPS Results

• Actual EPS: -$0.09
• Consensus EPS: $0.07
• Beat/Miss: Missed by -$0.16
• One Year Ago EPS: N/A

OPAL Fuels Revenue Results

• Actual Revenue: $73.38 million
• Expected Revenue: $93.87 million
• Beat/Miss: Missed by -$20.50 million
• YoY Revenue Growth: N/A

OPAL Fuels Announcement Details

• Quarter: Q1 2026
• Date: 5/9/2026
• Time: Before Market Opens
• Conference Call Date: Monday, May 11, 2026
• Conference Call Time: 11:00AM ET

OPAL Fuels (NASDAQ:OPAL) (NASDAQ: OPAL) is a publicly traded company headquartered in San Diego, California, specializing in the production, distribution and dispensing of renewable natural gas (RNG) for heavy-duty transportation. The company operates a network of RNG fueling stations across California, offering fleets of trucks, transit buses and logistics providers a low-carbon alternative to conventional diesel without requiring significant changes to existing vehicle technology or fueling infrastructure.

OPAL Fuels sources organic byproducts from dairy farms, landfills and food-processing facilities, converting methane-rich biogas into pipeline-quality RNG through a series of anaerobic digestion and gas-upgrading processes. By capturing and refining methane that would otherwise be released into the atmosphere, the company helps its customers reduce greenhouse gas emissions while advancing circular-economy principles in the agricultural and waste-management sectors.

The company’s geographically concentrated network serves key freight corridors in California, with strategic partnerships in place to extend RNG supply and fueling options into additional western U.S. markets. Collaboration agreements with waste generators, transportation companies and local authorities support OPAL Fuels’ expansion plans and underpin its long-term growth strategy in the sustainable-fuels space.

Founded to accelerate the decarbonization of heavy-duty transportation, OPAL Fuels leverages expertise in gas processing, fuel distribution and infrastructure development. Its management team brings decades of experience in energy, waste management and sustainable-fuel technologies, positioning the company to meet evolving regulatory requirements and customer demand for cleaner-burning transportation fuels.

OPAL Fuels Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Operations improved with RNG production up 9% year‑over‑year to 1.2 million MMBtu and management expects accelerating production growth starting in Q2 plus >2 million MMBtu of new design capacity coming online over the next year.
• Negative Sentiment: Adjusted EBITDA fell to $16.7 million from $20.1 million a year ago, chiefly due to lower realized RIN prices which reduced Q1 EBITDA by roughly $4 million and pressured revenue versus 2025.
• Positive Sentiment: Balance sheet and financing strengthened: the company completed ~$288 million of financings (including a $180 million preferred facility), drew its term loan, and exited the quarter with approximately $233 million of liquidity
• Positive Sentiment: Commercial outlook is improving as fleets show momentum toward CNG/RNG deployments—citing diesel price volatility, regulatory clarity, and successful Cummins X15N tests—with initial deployments expected to begin contributing in 2027 (not materially in 2026).
• Neutral Sentiment: The company reiterated full‑year 2026 guidance but warned of near‑term lumpiness from weather, construction timing, and one‑off contracts, and noted its forward‑looking optimism reflects management’s perspective rather than guaranteed outcomes.

[Operator]

Good morning, and welcome to the OPAL Fuels first quarter 2026 earnings call and webcast. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star one one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one one again. As a reminder, this event is being recorded. I would now like to turn the call over to Todd Firestone, Vice President of Investor Relations, to begin. Please go ahead.

[Todd Firestone, VP of Investor Relations at OPAL Fuels]

Thank you. Good morning, everyone. Welcome to the OPAL Fuels first quarter 2026 earnings conference call. With me today are Co-CEOs Adam Comora and Jonathan Maurer, as well as Kazi Hasan, OPAL's Chief Financial Officer. OPAL Fuels released financial and operating results for the first quarter of 2026 this morning. Those results are available on the investor relations section of our website at opalfuels.com. The presentation and access to the webcast for this call are also available on our website. After completion of today's call, a replay will be available for 90 days. Before we begin, I'd like to remind you that our remarks, including answers to your questions, contain forward-looking statements which involve risks, uncertainties, and assumptions. Forward-looking statements are not a guarantee of performance. Actual results could differ materially from what is contained in such statements.

[Todd Firestone, VP of Investor Relations at OPAL Fuels]

Several factors that could cause or contribute to such differences are described on slides two and three of our presentation. These forward-looking statements reflect our views as of the date of this call. OPAL Fuels does not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date of this call. This call will contain discussion of certain non-GAAP measures. A definition of non-GAAP measures used in a reconciliation of these measures to the GAAP measure is included in the appendix of the release and presentation. Adam will begin today's call by providing an overview of the quarter's results and recent highlights. Jon will give a commercial and business development update, after which Kazi will review financial results. We'll open the call for questions. I'll turn the call over to Adam Comora, Co-Chief Executive Officer of OPAL Fuels.

[Adam Comora, Co-CEO at OPAL Fuels]

Thank you, Todd, and good morning, everyone, and thank you for participating in OPAL Fuels first quarter 2026 earnings call. Despite a challenging operating environment in the seasonally soft first quarter, we remain on track to meet our full-year guidance. Production is improving in line with our expectations, and we are encouraged by the firming of environmental credit pricing. In addition to the performance and growth in our operating platform, we are energized by the engagement we are seeing from our business development activities for new CNG, RNG fleet deployments in heavy-duty trucking. A variety of factors are leading to the logjam finally breaking for new CNG and RNG fleet deployments. High and volatile diesel pricing, regulatory clarity regarding combustion engines, and the successful tests of the Cummins X15N are moving fleets into decision-making mode for what we believe is a great product.

[Adam Comora, Co-CEO at OPAL Fuels]

CNG is a winning economic proposition for fleets. It supports their operations with minimal change and disruption, and the fact we deliver low carbon intensity RNG and its ancillary benefits make it that much more compelling. We spent much of last week at ACT Expo, our industry's flagship conference, and the excitement around RNG and CNG is real. In addition to the financial benefits, fleets also recognize the value of the sustainability benefits, whether it be achieving their ESG goals, building their brand equity, or the strategic value to win new business, or more importantly, remaining competitive and not losing business to other fleets that are deploying RNG. Natural gas in North America is abundant and is expected to remain cheaper to oil on an energy equivalency value for the foreseeable future.

[Adam Comora, Co-CEO at OPAL Fuels]

Many heavy-duty industries in the U.S., such as steel, chemicals, and manufacturing, have already shifted from oil and coal to natural gas to capitalize on this lower cost energy. We believe heavy-duty trucking can be the next on that list. Diesel became the dominant fuel choice of heavy-duty trucking in the 1970s when the engine technology advanced with better fuel and cost efficiencies versus gasoline. The nine and 12-liter natural gas engine has been in the market for about 10 years and has seen strong adoption in the refuse and transit sectors after proving its cost effectiveness versus diesel. The largest refuse company in the U.S. reports it is closing in on 100% natural gas deployment for their fleet, and we estimate the broader refuse industry is approximately 30% natural gas deployment and growing.

[Adam Comora, Co-CEO at OPAL Fuels]

Now that the 15-liter natural gas engine has tested well for heavy-duty transportation, we anticipate accelerating adoption in this large and untapped market. CNG and RNG currently supply about 1 billion gallons of the 45 billion gallon diesel market, representing only a 2% market share at present. The industry and OPAL Fuels are ready to scale and begin capitalizing on this opportunity.

[Adam Comora, Co-CEO at OPAL Fuels]

As equipment suppliers and vendors continue to scale, they will take costs out, reducing the upfront premium on the tractors and expanding the market opportunity beyond the heaviest volume trucks. As we are energized by what we are seeing and hearing from our fleet partners, keep in mind, however, that as we mentioned on our March call, this business development activity will not get reflected in our 2026 financial results as it takes us about 12 months to build a station after signing, and these initial deployments will likely begin as smaller percentages within very large fleets. Before turning it over to John, I would like to close by talking once again about the strength of our vertically integrated model and how we see its benefits on both the upstream side of new project development opportunities and on the downstream side when working with fleets.

[Adam Comora, Co-CEO at OPAL Fuels]

Our upstream partners like OPAL's large and growing dispensing network. On the downstream side, our fleet partners not only appreciate our operational execution and low-cost fuel stations, but also our reliable, tangible, and growing RNG supply. OPAL Fuels is well-positioned with a proven track record, both on the upstream and the downstream side of our business, to be a leader in the production of RNG and capitalize on what we believe is an extraordinary growth opportunity for its use as a transportation fuel and heavy-duty trucking. With that, I'll turn it over to John. John?

[Jonathan Maurer, Co-CEO at OPAL Fuels]

Thank you, Adam. Good morning, everyone. We continue to see positive prospects for 2026 and beyond. Despite the extraordinarily cold winter in the first quarter, our upstream facilities performed well, producing more RNG compared with the comparable period in 2025. We generate yearly growth in the biogas resource. In addition, our team continues to make improvements to the performance of these facilities to better utilize that biogas. Together, these improvements give us confidence in our RNG production growth expectations. We continue to advance our in-construction portfolio, and we expect to bring online more than 2 million MMBtu of annual design capacity over the next year or so. We are also continuing to advance opportunities in our upstream development portfolio and anticipate announcing the allocation of capital in 2026 to new RNG projects as well as to fueling station growth.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

We are also making meaningful investments across our overall operating platform. These improvements include investments in personnel, technology, and introducing the adoption of artificial intelligence. These investments will support and augment future performance across our existing operating assets and give us confidence in improving results from executing on our business plan. We're seeing a strengthening RIN environment. Since our March call, the EPA released its final Set Rule with updated 2026 and 2027 RVO targets, which were generally in line with industry expectations. The D4, D5, and D6 prices have moved up dramatically, rising to over $2. We are now beginning to see the D3 RIN participate with the broader biofuel market, with current pricing above $2.50 per RIN, and that may continue increasing over the balance of the year.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

The work we are doing today is positioning OPAL for meaningful growth over the coming years. While large-scale deployments will take time to fully translate into financial results, we expect growth in 2027 and beyond to be driven by the increasing recognition by fleet operators of crude oil and diesel's sustained price volatility and the benefits of CNG and RNG. I'll now turn the call over to Kazi to discuss the quarter's financial performance. Kazi?

[Kazi Hasan, CFO at OPAL Fuels]

Thank you, John, and good morning, everyone. Before walking through the details, I want to frame our Q1 performance around three themes. First, the platform investments we have been making is beginning to show up in our operational and financial results. Second, our financing transactions have created the runway to allocate capital. Third, our earnings profile is broadening to reduce sensitivity to commodity pricing over time. This morning, we issued our earnings press release and posted an updated investor presentation on our website and filed our Form 10-Q. Adjusted EBITDA was $16.7 million in the quarter compared to $20.1 million in Q1 of 2025. The $3.4 million decline is primarily due to lower RIN prices.

[Kazi Hasan, CFO at OPAL Fuels]

These three realized prices declined $0.30 to $2.41 in Q1 2026 versus Q1 2025, resulting in approximately $4 million of EBITDA impact. Operationally, the business performed as expected. First quarter revenue was $73.3 million compared to $85.4 million in the prior year period. RNG production was 1.2 million MMBtu, up 9% year-over-year. The production improvement reflects enhanced execution by our operating team, which we expect to continue driving incremental production and efficiency gains. In our Fuel Station Services segment, first quarter EBITDA was $9.2 million compared to $10.9 million in the prior year period. The $1.7 million variance reflects a combination of lower construction revenues, lower RIN price, and timing of maintenance expenses in servicing the stations.

[Kazi Hasan, CFO at OPAL Fuels]

As we continue to grow OPAL-owned stations, we are seeing increasing contributions from the associated tolling activity, which is contracted and volume-based, and therefore relatively lower exposure to RIN pricing. In these stations, the variable costs of gas, power, and taxes are passed through to our customers. We expect the increasing growth of OPAL-owned stations to strengthen downstream earnings stability. We completed several financing transactions this quarter totaling $288 million, which included $180 million of preferred stock facility. In addition, we drew the remainder of our term loan facility with a net amount of $109 million. We ended the quarter with approximately $233 million of liquidity. This amount includes approximately $133 million of cash and short-term investments, $60 million of undrawn preferred stock facility commitments, and approximately $39 million of revolver availability.

[Kazi Hasan, CFO at OPAL Fuels]

In the quarter, we sold 11.5 million of ITC credits from Atlantic. We also completed a $100 million multiyear agreement to monetize OPAL Fuels' Section 45Z production tax credits. We maintain full year 2026 guidance. Stepping back, our financial strategy is clear. Grow operating and free cash flow, broaden the earnings base to reduce commodity exposure, and allocate capital to the highest return opportunities in our pipeline. With $233 million of liquidity and internal cash generation, OPAL Fuels is well positioned to execute on our strategy. With that, I'll now turn the call back over to John for closing remarks. John?

[Jonathan Maurer, Co-CEO at OPAL Fuels]

In closing, we remain well positioned for continued disciplined execution of our strategic growth objectives and the expansion of OPAL's vertically integrated platform. I'll now turn the call over to the operator for Q&A. Thank you all for your interest in OPAL Fuels.

[Operator]

Thank you. As a reminder, to ask a question, please press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Please wait while we assemble the roster. Our first question comes from [John Anders of Texas Capital]. Your line is open.

[John Anders, Analyst at Texas Capital]

Hey, good morning, all, and thanks for taking my questions. For my first one, it seems like there's real momentum on fleet conversions. Can you provide color on some of the factors driving this? Over what period do you see this converting into higher dispensing volumes?

[Adam Comora, Co-CEO at OPAL Fuels]

Yeah. Good morning. This is Adam here, appreciate the question. You know, it's a variety of factors that we think are gonna start to translate into the beginnings of fleet deployments here. I think, you know, clearly diesel pricing, not only the high price of diesel, but the volatility of diesel is what may be one of the key catalysts to force fleets into looking at other alternatives. I think the regulatory clarity that combustion engines are gonna be something that moves forward for heavy-duty trucking, it was really, you know, successful testing of the X15N engine.

[Adam Comora, Co-CEO at OPAL Fuels]

All three of those things have lined up for what we believe are gonna be some initial deployments here in very large fleets. You know, we think we will start to see some contributions in 2027. You know, they aren't gonna be, you know, extraordinarily large numbers for what the initial set of stations and trucks may be. We believe it's paving the way for a multiyear, you know, really long-term conversion set for this industry and this sector. We're excited that, you know, we've been talking about how the math makes sense and how the logic makes sense, we think it's finally gonna translate into some actions on that side of things here in 2026.

[John Anders, Analyst at Texas Capital]

I appreciate that color. For my follow-up, you highlighted difficult weather conditions in Q1. Can you help frame how much of an impact weather had during the quarter and your thoughts on the progression of the production ramp over the next three quarters to meet your 2026 guide?

[Jonathan Maurer, Co-CEO at OPAL Fuels]

This is John. I'll jump in on this one. You know, clearly the winter across the certainly east of the Rockies was extraordinary from a cold and from an amount of snow standpoint. Despite that, we were able to increase our production compared to the comparable period in the prior year. When we get cold like this, it affects us in three ways. The first is that it causes issues in the collection system at the landfill itself, where water in the gas will freeze within the collection system. The second area that it affects us is in our RNG projects directly where we get some freezing there. The third is that we have things outside of our control, such as power outages.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

All three of those affected us this year, but we were able to be resilient in our operations, and rise to some of those challenges. We take actions whenever we see these things, to try to add, for example, additional heat tracing or insulation or other things to our projects to add to that resilience. It will continue to pop up on us, particularly when it's an extraordinary winter as it was. Now we're turning into the springtime, and we're seeing the timing when well field expansion projects take place so that we start to see annual gas growth occur in Q2 and Q3 in terms of our, you know, the gas at the inlet.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

All of our projects are on open and growing landfills, we continue to take in amounts of waste that result in our inlet gas amounts increasing, and that causes our resource to grow year-over-year. There continues to be, you know, in summary, good resiliency to these seasonal issues that we have and that we continue to see. We'll see growth, quarter-over-quarter, during the year as we put some of these additional amounts into the collection. Adam?

[Adam Comora, Co-CEO at OPAL Fuels]

Yeah. The only thing I would also add there is not only on the production side that extraordinarily cold weather did result in some higher OpEx as well associated with that cold weather. You know, really almost a double whammy there with what we saw in the first quarter. Although we don't give production and earnings guidance by quarter, you know, we do expect accelerating production growth, you know, starting in second quarter and moving through the year.

[John Anders, Analyst at Texas Capital]

Thanks all. I appreciate the time.

[Operator]

Thank you. Our next question comes from Ryan Pfingst of B. Riley Securities. Your line is open.

[Ryan Pfingst, Analyst at B. Riley Securities]

Hey, good morning, guys. Thanks for taking my questions. Maybe just to follow up on that last one. Thinking about expected revenue or earnings cadence through the rest of this year, is there anything else to highlight or to look out for in terms of potential lumpiness, or are we expecting growth on a quarterly basis through 2026?

[Adam Comora, Co-CEO at OPAL Fuels]

I would say this is Adam here. Certainly it feels like the comps are getting easier for us as we move through the year where we're crossing over where the RIN price was Q2 from last year into this year. We're sort of through the tough quarter from a RIN price perspective and see those comps getting easier, particularly in Q3. I would also say we had in the first quarter of 2025 a higher LCFS credit sale in the first quarter of last year, which also impacted the comp when you're looking year-over-year.

[Adam Comora, Co-CEO at OPAL Fuels]

You know, some of our 45Z benefits were masked in the first quarter of this year versus, you know, an RNG sale from the first quarter of last year. Certainly it feels like the comps are gonna get much easier as we move through the year. All of this was baked into our guidance. We have a couple of nits on the Fuel Station Services side where construction revenues can be lumpy based on the timing of when that project work is done, and a little bit of, you know, timing in terms of when we had some maintenance costs. You know, we really feel like the first quarter was sort of the worst of all worlds.

[Adam Comora, Co-CEO at OPAL Fuels]

A lot of those things are gonna ease as we move through the year.

[Ryan Pfingst, Analyst at B. Riley Securities]

Appreciate that. Secondly, curious if you could give us an update on timelines for projects in construction or perhaps more high-level commentary on any particular challenges or positives to highlight around project development more broadly.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

Sure. I'll take that one. We're progressing full bore on our Cottonwood, Burlington, and CMS projects. We see these projects coming online towards the end of this year and into the first half of next year. We are seeing that construction timeline advance towards completion. The Cottonwood and Burlington projects are in the field right now with the construction contractors pouring cement at Cottonwood, and we're getting ready to do so at the Burlington project. CMS remains on track as well. On the development side of our business, we're progressing multiple opportunities. On a disciplined basis, we take into account our risk-adjusted capital, as well as our dispensing availability, which Adam mentioned. We see some logjam breaking there and some positive potential growth.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

Certainly on the downstream side of our business, we have 16 OPAL-owned stations that are in construction and progressing along. That's kind of where our construction business stands today.

[Adam Comora, Co-CEO at OPAL Fuels]

You know, sorry, just to go back to one of those other quarterly questions on cadence. Our toughest comp is coming in the fourth quarter, where we had a very low SG&A quarter in the fourth quarter of last year. I would just highlight that our toughest quarter will be in the fourth coming up this year.

[Ryan Pfingst, Analyst at B. Riley Securities]

I appreciate it, guys. Thanks.

[Operator]

Thank you. Our next question comes from Martin Malloy of Johnson Rice & Company. Your line is open.

[Martin Malloy, Analyst at Johnson Rice & Company]

Good morning. My first question, just wanted to ask about some of the new engine introductions that Cummins has, the X15 and the new X15 and X10 for 2027. Could you maybe talk about the potential impact you see on the demand for CNG resulting from those?

[Adam Comora, Co-CEO at OPAL Fuels]

Are you talking about the diesel engine that they're introducing? Are you talking about the natural gas engines? Good morning, and thank you for your question.

[Martin Malloy, Analyst at Johnson Rice & Company]

The natural gas engines.

[Adam Comora, Co-CEO at OPAL Fuels]

I think the 15-liter has performed extraordinarily well, really stood up to the duty cycles and the operating requirements of the fleets. You know, we think it's done extraordinarily well. Now you were asking about the X10?

[Martin Malloy, Analyst at Johnson Rice & Company]

Oh, I'm sorry. I misspoke there. It was the X15. I was just kind of curious if we could get your thoughts as you look out regarding potential return of capital to shareholders through a dividend.

[Adam Comora, Co-CEO at OPAL Fuels]

We are still seeing very strong opportunities to deploy capital and reinvest in our projects, both on the upstream and the downstream side. We still think that is the right place to be investing and growing our business, given those risk-adjusted returns. If those opportunities no longer appear in front of us, then we will start to looking at other ways to enhance shareholder value through that, you know, a potential dividend policy or something else. Right now, though, you know, we're really excited about some new upstream projects that we think we're gonna be green-lighting soon, and also the potential for OPAL-owned fuel stations in these fleet deployments.

[Martin Malloy, Analyst at Johnson Rice & Company]

Great. Thank you. I'll turn it back.

[Operator]

Thank you. Our next question comes from Adam Bubes of Goldman Sachs. Your line is open.

[Adam Bubes, VP of Equity Research at Goldman Sachs]

Hi, good morning. I know you talked about 2026 Fuel Station Services is gonna be a year where biz dev activity sets the stage for future growth. But are we thinking about 2026 EBITDA down versus 2025, or should we still expect growth this year? Based on dialogue with customers and pipeline of projects, how much visibility do you have on how 2027 could shape up?

[Adam Comora, Co-CEO at OPAL Fuels]

This is Adam again. No, we're not expecting Fuel Station Services necessarily to be down in 2026 to 2025. It was a noisy quarter for Fuel Station Services. You know, particularly on the GGE volumes, which I know get called out, and are not necessarily significantly impactful to how the profitability of that unit will do for the entire year. I think we called out on a previous conference call, that we did have one short-term contract, which is about 2.5 million gallons per quarter that we cycle through at the end of June here. You know, there is a little bit of GGE noise in there.

[Adam Comora, Co-CEO at OPAL Fuels]

To give you a flavor for that, you know, we're always opportunistic in our dispensing network, and have the abilities to flex up or flex down. We did have one large contract with a refuse customer that was looking for RNG supply from OPAL Fuels and some of our third-party suppliers as they were waiting for their projects to ramp and fill in their own dispensing capacity that we cycled through now in this second quarter. You know, we do expect the business unit to perform well this year. I think we also said in our guidance that it wasn't necessarily, you know, an outsized year in terms of what the growth would be in that segment.

[Adam Comora, Co-CEO at OPAL Fuels]

For 2027, it's a little early for us to really earmark, you know, how quick deployments are gonna be and how many stations it means and what it means for gallons that flow through in 2027. You know, we do expect some impact from some of these newer opportunities.

[Adam Bubes, VP of Equity Research at Goldman Sachs]

Got it. Then I just putting the pieces together for the reiterated guide, I think guidance at the midpoint embeds EBITDA up around $12 million year-over-year. 45Z is expected to contribute $15 million-$20 million, and I think RNG fuel production is also rising. If Fuel Station Services is up year-over-year, I'm just having trouble bridging the moving pieces. What's the delta there? Is that corporate expense inflation or anything I might be missing?

[Adam Comora, Co-CEO at OPAL Fuels]

Yeah. I mean, our corporate expense will be up year-over-year. That could be one area, and that's in the mid-single digit million range.

[Kazi Hasan, CFO at OPAL Fuels]

Let me also add. I think, Adam, this is Kazi. The RIN price variation is also on a year-on-year basis going to be one of the major impacts.

[Adam Bubes, VP of Equity Research at Goldman Sachs]

Got it. Got it. Understood. Last one from me. It sounds like, Adam, you alluded to maybe some new upstream projects in the pipeline. In the past, you've talked about a target to place 2 million MMBtu of landfill gas projects into construction annually. How are you thinking about the range of outcomes this year?

[Adam Comora, Co-CEO at OPAL Fuels]

Yeah. No. We, we will, we will have some new RNG project growth in 2026. Really, you know, what we've, what we've been telling folks is that, you know, we're flexible in our thinking and we're seeing a large opportunity in our downstream Fuel Station Services segment. You know, we're gonna be disciplined in our capital allocation. You know, we're not gonna give a specific target for how many new RNG projects from an MMBtu basis, but you should expect growth on both sides of our, you know, both sides of our business.

[Adam Bubes, VP of Equity Research at Goldman Sachs]

Great. Thanks so much.

[Operator]

Next question. Our next question comes from Richard DeDios of UBS. Your line is open.

[Richard DeDios, Analyst at UBS]

Hi. Thanks for taking our question. You guys have increased your cash pile and last earnings call you mentioned that you see opportunistic M&A opportunities. Can you walk us through how you're thinking about capital allocation, like what you're seeing in the M&A market and how it competes with potential projects? Thank you.

[Adam Comora, Co-CEO at OPAL Fuels]

Yeah. This is Adam again here. You know, it's pretty interesting. This quarter we saw the first transaction in our sector in quite some time with, you know, Ameresco's transaction with HASI. You know, I'm not sure if people have looked through those numbers yet, but it was pretty intriguing to us in terms of valuations and that sort of thing on the upstream part of our business. You know, we think it's an interesting sector with a lot of opportunities on the M&A side, particularly as a lot of RNG developers may be struggling with executing on their pipeline.

[Adam Comora, Co-CEO at OPAL Fuels]

You know, we're always, you know, evaluating and looking at other opportunities, and, do think our vertical integration puts us in a pretty unique position, you know, on that upstream M&A side of things.

[Kazi Hasan, CFO at OPAL Fuels]

Yeah. Can I take a sort of follow-up to that? There are two things that we will want to highlight. We are also continuing to invest in our existing operating asset base and operating platform to continue to improve the production as well as the whole results. The second thing that I wanna highlight is we are very disciplined in when it comes to capital allocation. We do have dry powder. Some of that amount is committed. Not committed, I think, we are going to invest in our existing construction projects. On top of that, whatever is left, we are going to look at our opportunities in both RNG projects as well as the downstream dispensing station platforms.

[Kazi Hasan, CFO at OPAL Fuels]

We will look at where we should invest to think about portfolio stability over the long term, and diversify, having too much exposure in one area versus other. Yes, we do have cash that we have place to put in. We want to make sure that we are being disciplined in capital allocation.

[Richard DeDios, Analyst at UBS]

Thanks for the color on that. Switching to the operational side point of view, given that this year's guide is largely driven by operational improvements, and as you look to scale RNG production over time, what has been the biggest operational learnings from your existing facilities, and how are those learnings being implemented for the development and execution of future projects?

[Jonathan Maurer, Co-CEO at OPAL Fuels]

Well, you know, we now have 10 landfill gas RNG projects, as we've grown quite a bit over the last several years and put more into operation, we really take lessons across the fleet in terms of what works at various projects and bringing that across to our other comparable projects. In addition, we've mentioned in the past how we've upgraded the personnel across our organization, both in terms of leading the RNG sector and the Fuel Station Services sector, as well as the employees within those groups. Lastly, some of the improvements that we're making are in the well field itself, putting in technology that helps to improve gas collection and both gas quality and gas quantity, you know, can be improved through that effort.

[Jonathan Maurer, Co-CEO at OPAL Fuels]

That will also serve to improve the availability of projects. You know, in summary, what you're seeing is better people, better efficiencies and availabilities and better gas collection, I think, in summary.

[Adam Comora, Co-CEO at OPAL Fuels]

Yeah. Just to finish off on John's thought, like we believe that's gonna show up both in terms of our inlet design capacity utilization and our utilization of inlet gas. It really goes all the way from the well field to operational availability and uptime to de-bottlenecking. You know, we've really, you know, it's leveraging where you're benchmarking your best facilities and bringing those best practices across the fleet.

[Richard DeDios, Analyst at UBS]

Thank you. I'll turn it back.

[Operator]

Thank you. I'm showing no further questions at this time. I'd like to turn it back to Adam Comora for closing remarks.

[Adam Comora, Co-CEO at OPAL Fuels]

Thank you all for your interest in OPAL Fuels and joining us today, and we look forward to chatting with you again soon.

[Operator]

This concludes today's conference call. Thank you for participating, and you may now disconnect.

Participants

Executives

• Adam Comora, Co-CEO
• Jonathan Maurer, Co-CEO
• Kazi Hasan, CFO
• Todd Firestone, VP of Investor Relations

Analysts

• Adam Bubes, VP of Equity Research at Goldman Sachs
• John Anders, Analyst at Texas Capital
• Martin Malloy, Analyst at Johnson Rice & Company
• Richard DeDios, Analyst at UBS
• Ryan Pfingst, Analyst at B. Riley Securities