Stocks

Clean Energy Fuels (CLNE) looks promising to investors

Clean Energy Fuels (CLNE) is a leading provide of the cleanest fuel, Natural Gas, for the transportation market in the United States and Canada. They primarily focus in on:

  1. Regional Fleets of Trucks
  2. Heavy Duty Trucking
  3. Airport Transit
  4. Public Transit
  5. Construction Vehicles
  6. Waste Management Vehicles (Dump trucks)

It’s products consist of Compressed Natural Gas (CNG), Renewable Natural Gas (RNG), and Liquefied Natural Gas (LNG). One of its leading products is something called Redeem, which is a form of renewable natural gas (RNG), won’t bother getting into how it’s composed, but know that it provides up to 70% reduction in greenhouse gasses versus diesel and gasoline. Redeem itself is made from organic waste from landfills and farms.

There has been a lot of stigma around what it really means to be “clean” or “green” when it comes to transportation; most of us think that Electric Vehicles seem to be the most green product for transportation out there. EV’s are definitely the future, I just want to state that before getting started spewing out more information, but RNG has huge demand and can definitely lead the way for clean energy. The company itself reduced 745,000 metric tons of greenhouse gas emissions and more than 401,000,000 gallons were sold in 2019.

The company currently has partnerships with Chevron, Total SE, BP, Waste Connections and Repbulic Services.

These partnerships will continue to provide Clean Energy Fuels Corp. with recurring revenues to drive growth across North America. Their recent and past partnerships continue to give rise to increasing demand of natural gas in one of the largest industries that demands fuel of this nature. The programs in place: Zero Now & Adopt-a-Port program were introduced and will drive growth in the industry by providing incentives to adopting RNG vehicles instead of gasoline or diesel-powered vehicles. There are a lot of advantages to adopting Redeem:

  • 70% reudction in greenhouse gases
  • Cost efficient – offered at $1.00/gallon.
  • Renewable
  • Domestic – Moving North America towards energy independence.

With most of the world in lockdown, and the rise of eCommerce and the need for shipping and delivery services, this will drive the demand for their Redeem product. Companies like UPS, Kroger, FedEx and Republic Services have already signed up for large deals to use the product as a substantially lower cost then Diesel or Gas. The cost of Redeem is $1.00/gallon to give you perspective. Volume growth for their Redeem Product in the past 3 years averaged 34.67% growth; and this was before the Pandemic.

The Heavy-Duty Truck industry is one of the largest markets for fuel consumption, and so the opportunities are endless to gain more market share as governments are demanding for greener transportation. The Heavy-Duty trucing industry demands 35 billion gallons of fuel, 30 billion over any other market in the big-rig industries.

There are a lot of opportunities for future advancement throughout the space by making partnerships that will be mutually beneficial for both the world, CLNE, and the company involved. Companies that currently use Natural Gas for their national fleets include: Honda, FritoLay, FedEx, Anheuser Busch, Verizon, Bimbo, J&J, Waste Management, Republic Services, Home Depot, Lowes, AT&TT, Costco, Colgate-Palmolive, PepsiCo, UPS, HP, Unilever, Starbucks, Amazon, Kraft, Kroger, and McDonalds. These companies are large, and there is huge potential for future partnerships with them.