Clean Energy Fuels (NASDAQ:CLNE) reported second-quarter results that management said were in line with expectations, as higher fuel volumes, improved renewable natural gas production and favorable environmental credit pricing supported its full-year outlook.
The company posted second-quarter revenue of $106.4 million, compared with $102.6 million in the prior-year period. Adjusted EBITDA was $16 million, while renewable natural gas, or RNG, sales totaled $63 million. Clean Energy ended June with $138 million in cash and short-term investments, up from $126 million at the end of March.
Fuel volumes rise as RNG production ramps
Second-quarter fuel volumes increased 7% year over year to 81.8 million gallons, Chief Financial Officer Bob Vreeland said. About two-thirds of the growth came from conventional natural gas volumes, driven by added fueling locations for major fleet customers for which Clean Energy also provides maintenance services.
RNG volumes increased 3% from a year earlier to 63.2 million gallons. Vreeland said the growth reflected normal variations among customer sectors, while RNG volumes through June remained ahead of the company’s internal plan.
Production from Clean Energy’s dairy RNG projects reached 2.1 million gallons during the quarter, substantially above the prior-year level as the company’s upstream portfolio continued to ramp. Corbus said improved weather compared with the first quarter and continued progress at the South Fork project in Texas and East Valley project in Idaho contributed to the improvement.
Clean Energy has eight operating RNG projects and three projects under construction through its joint venture with Maas Energy Works. Management expects two of those projects to begin operations later in 2026, with the final project expected to be completed next year.
Corbus said the second half should be “much better” than the first half for the upstream RNG business as production rises and operational improvements take hold. The company also expects greater production volumes to improve profitability by absorbing more fixed overhead costs.
45Z guidance remains a key variable
Management maintained its full-year adjusted EBITDA guidance of $70 million to $75 million, but said the outlook depends in part on final Treasury guidance for the Section 45Z clean fuel production credit and an updated GREET model.
Vreeland said the company’s guidance includes up to $5 million of potential incremental adjusted EBITDA from improved 45Z production-credit values. The final rules are now expected in the fourth quarter, later than Clean Energy had initially anticipated.
If the guidance is delayed into 2027, or if its economic value is limited, Clean Energy’s 2026 adjusted EBITDA could fall below the stated range, Vreeland said. He characterized the principal uncertainty as one of timing, while maintaining that the company expects the final rules to be favorable.
The company is also monetizing California Low Carbon Fuel Standard credits for its RNG operations at temporary pathway levels. Management said it has a provisional pathway for Del Rio and temporary pathways for seven other projects. It expects provisional pathways for five projects in its BP joint venture next year, while South Fork and East Valley may not receive provisional pathways until 2028. The company said it is not incorporating a transition from temporary to provisional pathways in its forecast.
Truck market adoption remains gradual
Clean Energy said RNG fuel volumes from heavy-duty trucking were steady during the quarter, with several fleets adding small numbers of trucks powered by the Cummins X15N natural gas engine.
Corbus said demand has been affected by uncertainty around EPA 2027 emissions standards, contributing to a “large pre-buy” of legacy diesel trucks. He added that the incremental cost advantage for natural gas trucks remains influenced by the future cost of diesel engines, which are expected to become more expensive as emissions-related technology is introduced.
Still, higher diesel prices and price volatility have strengthened the case for RNG, according to Corbus. The company increased advertising directed toward trucking fleets over the past four to five months, emphasizing RNG’s lower and more stable price compared with diesel. He said the campaign has generated more leads, appointments and discussions with potential customers.
In Canada, Clean Energy recently completed two additional stations, including a location outside Vancouver that completes a western Canadian natural gas fueling network. Corbus said high diesel taxes, significant truck mileage and the arrival of the X15N in Canada have prompted positive fleet responses.
Company highlights power and hydrogen opportunities
Beyond vehicle fueling and RNG production, Clean Energy is pursuing opportunities to supply natural gas for power generation and industrial applications. Corbus said the company can use compressed natural gas tube trailers to serve facilities that lack pipeline access or are awaiting electrical-grid connections.
The company’s NG Advantage subsidiary has 102 trailers and compression capacity in the Northeast. Corbus said Clean Energy can initially pursue these opportunities using existing assets and excess compression capacity at its roughly 600 fueling stations, without requiring significant new investment.
Clean Energy recently signed a contract to supply CNG to a large California fulfillment center that requires bridge fuel for power generation while awaiting a utility connection. The company also cited contracts in Puerto Rico for a pharmaceutical manufacturing facility and a 6-megawatt power plant.
On the hydrogen side, Clean Energy announced a $27 million contract with the Orange County Transportation Authority to design and build a private fueling station. The station is intended to support OCTA’s existing fleet of 10 fuel-cell buses and 40 additional buses planned by the agency.
Corbus said Clean Energy’s hydrogen strategy is centered on cost-plus contracts with transit agencies, coupled with operations, maintenance and hydrogen supply agreements. The company does not intend to deploy its own capital or take commodity risk to develop standalone hydrogen projects.
Clean Energy also announced the appointment of Bart Frabotta as chief operating officer. Corbus said Frabotta’s priorities will include improving execution, operating performance and technology deployment across the company.
About Clean Energy Fuels (NASDAQ:CLNE)
Clean Energy Fuels Corp., founded in 1997 and headquartered in Newport Beach, California, is a leading provider of natural gas and renewable natural gas (RNG) fuel for the transportation sector. The company operates a network of more than 500 fueling stations across the United States and Canada, supplying compressed natural gas (CNG), liquefied natural gas (LNG) and RNG derived from organic waste streams. Clean Energy serves a diverse customer base that includes commercial trucking fleets, public transit agencies, refuse haulers and municipal vehicle operators.
In addition to fuel supply, Clean Energy offers turnkey station design, construction and ongoing maintenance services, as well as fueling hardware and project management.
