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What changed in Clean Energy Fuels Corp.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Clean Energy Fuels Corp.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+359 added−333 removedSource: 10-K (2025-02-24) vs 10-K (2024-02-29)

Top changes in Clean Energy Fuels Corp.'s 2024 10-K

359 paragraphs added · 333 removed · 268 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

77 edited+23 added−17 removed103 unchanged
Biggest changeEmployees and our Human Capital As of December 31, 2023, we employed 566 people. We have not experienced any work stoppages, and none of our employees are subject to collective bargaining agreements. The success and growth of our business is significantly correlated with our ability to recruit, train, promote and retain talented individuals at all levels of our organization.
Biggest changeThe success and growth of our business is significantly correlated with our ability to recruit, train, promote and retain talented individuals at all levels of our organization. To succeed in a competitive labor market, we have developed and maintain key recruitment and retention strategies.
As operators deploy more hydrogen powered vehicles, we can modify our fueling stations to reform our RNG and deliver clean hydrogen to customers.
As more operators deploy hydrogen powered vehicles, we can modify our fueling stations to reform our RNG and deliver clean hydrogen to customers.
We are focused on developing, owning, and operating dairy and other livestock waste RNG projects and supplying RNG (currently procured from third party sources and from our anaerobic digester gas (“ADG”) RNG joint venture project with TotalEnergies S.E. (the “DR JV”) (see Note 4)) to our customers in the heavy and medium-duty commercial transportation sectors.
We are focused on developing, owning, and operating dairy and other livestock waste RNG projects and supplying RNG (currently procured from third party sources and from our anaerobic digester gas (“ADG”) RNG joint venture project with TotalEnergies S.E. (the “DR JV”) (see Note 3)) to our customers in the heavy and medium-duty commercial transportation sectors.
NG Advantage also has the capability to transport CNG from production facilities to pipeline injection sites using its fleet of 97 high-capacity trailers. ● LNG is RNG or conventional natural gas that is cooled at a liquefaction facility to approximately negative 260 degrees Fahrenheit until it condenses into a liquid.
NG Advantage also has the capability to transport CNG from production facilities to pipeline injection sites using its fleet of 96 high-capacity trailers. ● LNG is RNG or conventional natural gas that is cooled at a liquefaction facility to approximately negative 260 degrees Fahrenheit until it condenses into a liquid.
Environmental Protection Agency (“EPA”), methane is a significant GHG, which accounted for roughly 12% of all U.S. GHG emissions from human activities in 2021 and which has a comparative impact on global warming that is about 28 times more powerful than that of carbon dioxide over a 100-year period.
Environmental Protection Agency (“EPA”), methane is a significant GHG, which accounted for roughly 12% of all U.S. GHG emissions from human activities in 2022 and which has a comparative impact on global warming that is about 28 times more powerful than that of carbon dioxide over a 100-year period.
As of December 31, 2023, we have not received any U.S. Occupational Health and Safety Administration (“OSHA”) or state OSHA citations in the last five years. How We Generate Revenue We generate revenue from selling RNG and conventional natural gas as a vehicle fuel, as well as by selling the associated Environmental Credits.
As of December 31, 2024, we have not received any U.S. Occupational Health and Safety Administration (“OSHA”) or state OSHA citations in the last five years. How We Generate Revenue We generate revenue from selling RNG and conventional natural gas as a vehicle fuel, as well as by selling the associated Environmental Credits.
As of December 31, 2023, public transit customers for which we serve include the Los Angeles County Metropolitan Transit Authority, New York MTA, Foothill Transit (Los Angeles County, California), Orange County Transit Authority, Santa Monica Big Blue Bus, Dallas Area Rapid Transit, Phoenix Transit, New Jersey Transit, Jacksonville Transportation Authority, NICE Bus (Nassau County, New York) and Washington Metro Area Transportation Authority.
As of December 31, 2024, public transit customers for which we serve include the Los Angeles County Metropolitan Transit Authority, New York MTA, Foothill Transit (Los Angeles County, California), Orange County Transit Authority, Santa Monica Big Blue Bus, Dallas Area Rapid Transit, Phoenix Transit, New Jersey Transit, Jacksonville Transportation Authority, NICE Bus (Nassau County, New York) and Washington Metro Area Transportation Authority.
Since 2008, we have served as the general contractor or supervised qualified third-party contractors to build over 460 natural gas fueling stations. Grant Programs. We apply for and help our fleet customers apply for federal, state and local grant programs in areas in which we operate.
Since 2008, we have served as the general contractor or supervised qualified third-party contractors to build over 470 natural gas fueling stations. Grant Programs. We apply for and help our fleet customers apply for federal, state and local grant programs in areas in which we operate.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC, including us. All references to our website in this report are inactive textual references, and the contents of our website are not incorporated into this report.
The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC, including us. All references to our website in this report are inactive textual references, and the contents of our website are not incorporated into this report. 16 Table of Contents
As of December 31, 2023, we fuel approximately 16,000 refuse vehicles for customers including Waste Management, Republic Services, Waste Connections, GFL Environmental, Atlas Disposal, Burrtec, CR&R, Recology and Waste Pro, among others. We also provide vehicle fueling services to municipal refuse fleets. Public Transit We believe that there are over 72,000 municipal transit buses operating in the U.S.
As of December 31, 2024, we fuel approximately 16,100 refuse vehicles for customers including Waste Management, Republic Services, Waste Connections, GFL Environmental, Atlas Disposal, Burrtec, CR&R, Recology and Waste Pro, among others. We also provide vehicle fueling services to municipal refuse fleets. Public Transit We believe that there are over 72,000 municipal transit buses operating in the U.S.
Because our business involves the capture and transformation of waste methane into a renewable source of energy, our customers are able to significantly reduce, if not eliminate, GHG emissions from their commercial transportation activities. Further, CARB calculates RNG produced by livestock farms as carbon negative, generating substantial incremental CA LCFS credits.
Because our business involves the capture and transformation of waste methane into a renewable source of energy, our customers are 9 Table of Contents able to significantly reduce, if not eliminate, GHG emissions from their commercial transportation activities. Further, CARB calculates RNG produced by livestock farms as carbon negative, generating substantial incremental CA LCFS credits.
There is a global demand for reducing GHG emissions, as evidenced by 96% of the world’s countries having committed to the Paris Agreement according to The United Nations Framework Convention in Climate Change, and 98% of S&P 500 companies focusing on sustainability metrics, including GHG emissions, according to the Governance & Accountability Institute’s Flash Report published in 2023. 3 Table of Contents Biogas, the primary source of RNG, is produced by microbes as they break down organic matter in the absence of oxygen.
There is a global demand for reducing GHG emissions, as evidenced by 98% of the world’s countries having committed to the Paris Agreement according to The United Nations Framework Convention in Climate Change, and 98.6% of S&P 500 companies focusing on sustainability metrics, including GHG emissions, according to the Governance & Accountability Institute’s Flash Report published in 2024. 3 Table of Contents Biogas, the primary source of RNG, is produced by microbes as they break down organic matter in the absence of oxygen.
We source RNG from the DR JV, one of our jointly owned RNG production facilities, and purchase RNG from bp and other third-party producers, comprising over 100 supply sources, typically under long-term RNG supply offtake agreements.
We source RNG from the DR JV, one of our jointly owned RNG production facilities, and purchase RNG from bp and other third-party producers, comprising over 150 supply sources, typically under long-term RNG supply offtake agreements.
Given the potential growth and positive environmental impact of RNG, our mission is to obtain as much RNG supply as possible. To that end we are pursuing development and ownership of dairy and other livestock waste ADG projects on our own and with partners including TotalEnergies S.E. (“TotalEnergies”) and BP Products North America (“bp”).
Given the potential growth and positive environmental impact of RNG, our mission is to secure and sell as much RNG supply as possible. To that end we are pursuing development and ownership of dairy and other livestock waste ADG projects on our own and with partners including TotalEnergies S.E. (“TotalEnergies”) and BP Products North America (“bp”).
Adding digestate to soil increases the organic matter content, reduces the need for chemical fertilizers, improves plant growth and alleviates soil compaction. Further, digestion converts nutrients in manure to a more accessible form for plants to use. The risks of water and soil contamination from flooding of open lagoons are also mitigated by digesters.
Adding digestate to soil increases the organic matter content, reduces the need for chemical fertilizers, improves plant growth and alleviates soil compaction. Further, digestion converts nutrients in manure to a more 10 Table of Contents accessible form for plants to use. The risks of water and soil contamination from flooding of open lagoons are also mitigated by digesters.
Collectively, our three 100% owned ADG RNG projects will have an estimated RNG production volume of 3.6 million GGEs per year, all of which will be available to us for sale to the vehicle fuels market. Tourmaline Joint Development On April 18, 2023, we and Tourmaline Oil Corp.
Collectively, our three 100% owned ADG RNG projects will have an estimated RNG production volume of 3.6 million GGEs per year, all of which will be available to us for sale to the vehicle fuels market. 8 Table of Contents Tourmaline Joint Development On April 18, 2023, we and Tourmaline Oil Corp.
California Air Resources Board “Current Fuel Pathways” Q2 2021 to Q3 2023 ​ At present, we see the best use of RNG as a replacement for fossil-based fuel in the transportation sector.
California Air Resources Board “Current Fuel Pathways” Q2 2021 to Q3 2024 ​ At present, we see the best use of RNG as a replacement for fossil-based fuel in the transportation sector.
The Company’s RNG projects As of December 31, 2023, we had three 100% owned ADG RNG projects under development, which are anticipated to be substantially complete between the second and third quarter of 2025.
The Company’s RNG projects As of December 31, 2024, we had three 100% owned ADG RNG projects under development, which are anticipated to be substantially complete between the second and third quarter of 2025.
These intellectual property rights help us to retain existing business and secure new relationships with customers. We have a total of 13 issued patents currently active, including 10 patents issued by the United States Patent and Trademark Office (“USPTO”) and 3 patents issued by the Canadian Intellectual Property Office (“CIPO”), expiring between 2027 and 2036.
These intellectual property rights help us to protect our innovations, retain existing business and secure new relationships with customers. We have a total of 13 issued patents currently active, including 10 patents issued by the United States Patent and Trademark Office (“USPTO”) and 3 patents issued by the Canadian Intellectual Property Office (“CIPO”), expiring between 2027 and 2036.
Our Strategy We aim to maintain and increase our position as the leading provider of RNG to the commercial vehicle market in North America, and our goal is to deliver 100% RNG to our entire fueling infrastructure by 2025.
Our Strategy We aim to maintain and increase our position as the leading provider of RNG to the commercial vehicle market in North America, and our goal is to deliver 100% RNG to our entire fueling infrastructure.
Increasing vehicle availability RNG is a replacement for fossil-based fuel consumed by vehicles that use internal combustion engines like those used in gasoline- or diesel-powered vehicles. Virtually any car, truck, bus, or other vehicle is capable of being manufactured to 7 Table of Contents run on RNG.
Increasing vehicle availability RNG is a replacement for fossil-based fuel consumed by vehicles that use internal combustion engines like those used in gasoline- or diesel-powered vehicles. Virtually any car, truck, bus, or other vehicle is capable of being manufactured to run on RNG.
According to the Global Carbon Project’s Global Carbon Budget published in December 2023 and International Energy Agency’s topic analysis on transport, 37.1 billion metric tons of carbon dioxide were emitted globally in 2022, of which 8.0 billion metric tons, or 22%, came from the transportation sector.
According to the Global Carbon Project’s Global Carbon Budget published in December 2024 and International Energy Agency’s topic analysis on transport, 37.0 billion metric tons of carbon dioxide were emitted globally in 2023, of which 8.0 billion metric tons, or 22%, came from the transportation sector.
Biogas processing facilities substantially reduce methane emissions at livestock farms and landfills, which together accounted for approximately 40% of U.S. methane emissions in 2021 according to the EPA. Over the past decade we have seen the transportation sector be the fastest growing end market for RNG, where RNG is used as a replacement for fossil-based fuel.
Biogas processing facilities substantially reduce methane emissions at livestock farms and landfills, which together accounted for approximately 41% of U.S. methane emissions in 2022 according to the EPA. Over the past decade we have seen the transportation sector be the fastest growing end market for RNG, where RNG is used as a replacement for fossil-based fuel.
This project is estimated to produce up to 1.1 million GGEs of RNG annually, all of which will be available to the Company for sale to the vehicle fuels market. bp Joint Venture On April 13, 2021, pursuant to a memorandum of understanding we entered into with bp in December 2020, we entered into an agreement (“bp JV Agreement”) with bp that created a 50/50 joint venture (the “bpJV”) to develop, own and operate new ADG RNG production facilities in the U.S.
This project is estimated to produce up to 0.8 million GGEs of RNG annually, all of which is available to the Company for sale to the vehicle fuels market. bp Joint Venture On April 13, 2021, pursuant to a memorandum of understanding we entered into with bp in December 2020, we entered into an agreement (“bp JV Agreement”) with bp that created a 50-50 joint venture (the “bpJV”) to develop, own and operate new ADG RNG production facilities in the U.S.
Pursuant to the TotalEnergies JV Agreement, the Company and TotalEnergies have given each party a limited right of first opportunity to invest in ADG RNG projects they respectively originate. Currently, there is one ADG RNG joint venture project (the DR JV) in operation pursuant to the TotalEnergies JV Agreement.
Pursuant to the TotalEnergies JV Agreement, the Company and TotalEnergies have given each party a limited right of first opportunity to invest in ADG RNG projects they respectively originate. Currently, there is one ADG RNG joint venture project (the “DR JV”) in operation pursuant to the TotalEnergies JV Agreement.
The Boron Plant can produce 56.0 million gallons of LNG per year and has a dual tanker trailer loading system and a 1.8 million 5 Table of Contents gallon storage tank that can hold up to 1.5 million usable gallons.
The Boron Plant can produce 98.5 million gallons of LNG per year and has a dual tanker trailer loading system and a 1.8 million 5 Table of Contents gallon storage tank that can hold up to 1.5 million usable gallons.
RNG, which is delivered as either CNG or LNG, is created by the recovery and processing of naturally occurring, environmentally detrimental waste methane (“biogas”) from non-fossil fuel sources – such as dairy and other livestock waste and landfills – for beneficial use as a replacement for fossil-based transportation fuels.
RNG, which is delivered as either CNG or LNG, is created by the recovery and processing of naturally occurring, environmentally detrimental waste methane (“biogas”) from non-fossil fuel sources – such as dairy and other livestock waste and landfills – for environmentally beneficial use as a replacement for fossil-based transportation fuels at an affordable price.
Collectively, the six ADG RNG projects in the bpJV are currently estimated to produce up to 11.1 million GGEs of RNG annually, and 100% of the RNG produced from these projects will be available to us for sale as vehicle fuel pursuant to our existing marketing agreement with bp.
Collectively, the six ADG RNG projects in the bpJV are currently estimated to produce up to 8.2 million GGEs of RNG annually, and 100% of the RNG produced from these projects will be available to us for sale as vehicle fuel pursuant to our existing marketing agreement with bp.
With the Company’s focus on RNG, our sales of RNG have grown from 12% of our vehicle fuel sales in 2013 to 89% of our vehicle fuel sales in 2023 (excluding GGEs from O&M (as defined below) services sales and non-vehicle sales).
With the Company’s focus on RNG, our sales of RNG volume have grown from 12% of our vehicle fuel sales in 2013 to 89% of our vehicle fuel sales in 2024 (excluding GGEs from O&M (as defined below) services sales and non-vehicle sales).
In addition to registering each RNG project, we are subject to quarterly audits under the Quality Assurance Plan of our projects to validate our qualification. Our operations are also subject to state renewable fuel standard regulations.
In addition to registering each RNG project, we are subject to quarterly audits under the Quality Assurance Plan of our projects to validate our qualification. 14 Table of Contents Our operations are also subject to state renewable fuel standard regulations.
We cannot estimate the expenses we may incur to comply with potential new laws or changes to existing laws, or the other 14 Table of Contents potential effects these laws may have on our business, and these unknown costs and effects are not specifically contemplated by our existing customer agreements or our budgets and cost estimates.
We cannot estimate the expenses we may incur to comply with potential new laws or changes to existing laws, or the other potential effects these laws may have on our business, and these unknown costs and effects are not specifically contemplated by our existing customer agreements or our budgets and cost estimates.
By setting and maintaining high standards in the renewable energy field, we are often able to contribute positively to the safety practices and policies of our partners and customers.
By setting and maintaining high standards in the renewable energy field, we are often 11 Table of Contents able to contribute positively to the safety practices and policies of our partners and customers.
(“Tourmaline”) announced a CAD $70 million Joint Development Agreement to build and operate a network of CNG stations along key highway corridors across Western Canada.
(“Tourmaline”) announced a CAD $70 million Joint Development Agreement (“the Tourmaline JDA”) to build and operate a network of CNG stations along key highway corridors across Western Canada.
Many established businesses are in the market for RNG and other alternatives for use as vehicle fuel, including alternative vehicle and alternative fuel companies, refuse collectors, industrial gas companies, truck stop and fuel station owners, fuel providers, utilities and their affiliates and other organizations.
Many established businesses are in the market for RNG and other alternatives for use as vehicle fuel, including alternative vehicle and alternative fuel companies, refuse collectors, 13 Table of Contents industrial gas companies, truck stop and fuel station owners, fuel providers, utilities and their affiliates and other organizations.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” 16 Table of Contents Intellectual Property Our intellectual property rights primarily consist of trade secrets, patents, know-how and trademarks, and we rely on a combination of trademark laws, trade secret laws, confidentiality provisions and other contractual provisions to protect these rights and our proprietary information.
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Intellectual Property Our intellectual property rights primarily consist of trade secrets, patents, know-how, trademarks and copyrights, and we rely on a combination of trademark laws, patent laws, trade secret laws, copyrights laws, confidentiality provisions and other contractual provisions to protect these rights and our proprietary information.
Many transit agencies have been early adopters of vehicles using our 13 Table of Contents fuels, and approximately 30% of existing transit buses and approximately 35% of new transit buses can operate on RNG.
Many transit agencies have been early adopters of vehicles using our fuels, and approximately 30% of existing transit buses and approximately 35% of new transit buses can operate on RNG.
In accordance with the TotalEnergies JV Agreement, we will provide TotalEnergies with the right of first opportunity to invest in these ADG RNG projects 8 Table of Contents alongside the Company.
In accordance with the TotalEnergies JV Agreement, we will provide TotalEnergies with the right of first opportunity to invest in these ADG RNG projects alongside the Company.
Our supply offtake agreements are variable and are based on actual RNG produced by the third-party producers, up to various maximum volume levels as governed by the arrangement. In 2023, our third-party sourced RNG consisted of 22% ADG and 78% LFG. Conventional natural gas is typically sourced from local utilities or third-party conventional natural gas marketers.
Our supply offtake agreements are variable and are based on actual RNG produced by the third-party producers, up to various maximum volume levels as governed by the arrangement. In 2024, our third-party sourced RNG consisted of 34% ADG and 66% LFG. Conventional natural gas is typically sourced from local utilities or third-party conventional natural gas marketers.
As these facility owners expand their operations, we provide additional access to our fueling infrastructure and customer relationships. As of December 31, 2023, we obtain RNG from over 100 supply sources.
As these facility owners expand their operations, we provide additional access to our fueling infrastructure and customer relationships. As of December 31, 2024, we obtain RNG from over 150 supply sources.
Multiple other states, including New York and New Mexico are considering LCFS initiatives like those implemented in California, Oregon and Washington. In 2023, we estimate that we generated 44% of all LCFS credits under Bio-CNG and Bio-LNG pathways in the CA LCFS.
Multiple other states, including New York and Illinois are considering LCFS initiatives like those implemented in California, Oregon, New Mexico, and Washington. In 2024, we estimate that we generated 42% of all LCFS credits under Bio-CNG and Bio-LNG pathways in the CA LCFS.
We are North America’s leading provider of the cleanest fuel for the commercial transportation market, based on both the number of stations we operate and the amount of GGEs serviced and GGEs sold of RNG and conventional natural gas, in the form of CNG and LNG, which amounted to a total of 466.2 million GGEs in 2023.
We are North America’s leading provider of the cleanest fuel for the commercial transportation market, based on both the number of stations we operate and the amount of GGEs serviced and GGEs sold of RNG and conventional natural gas, in the form of CNG and LNG, which amounted to a total of 477.9 million GGEs in 2024.
We estimate there are approximately 4.1 million Class 8 heavy-duty trucks operating in the U.S. using over 40 billion gallons of fuel each year. Because these high-mileage vehicles consume substantial amounts of fuel, operators can derive significant benefits from the carbon and GHG reductions associated with our vehicle fuels.
We estimate there are approximately 4.1 million Class 8 heavy-duty trucks operating in the U.S. using over 40 billion gallons of fuel each year. Because these high-mileage vehicles consume substantial amounts of fuel, operators can derive significant benefits from the carbon and GHG reductions associated with our vehicle fuels, while doing it at competitive costs versus diesel.
As of December 31, 2023, we deliver RNG to the transportation market through 579 fueling stations we own, operate or supply in 43 states and the District of Columbia in the U.S., including over 200 stations in California. We also own, operate, or supply 24 fueling stations in Canada as of December 31, 2023.
As of December 31, 2024, we deliver RNG to the transportation market through 582 fueling stations we own, operate or supply in 43 states and the District of Columbia in the U.S., including over 200 stations in California. We also own, operate, or supply 25 fueling stations in Canada as of December 31, 2024.
In 2023, we estimate that we generated 47% of all D3 RINs in the U.S. The monetization of RNG also benefits from low-carbon fuel initiatives at the state-level, specifically from established programs in California, Oregon and Washington.
In 2024, we estimate that we generated 39% of all D3 RINs in the U.S. The monetization of RNG also benefits from low-carbon fuel initiatives at the state-level, specifically from established programs in California, Oregon, New Mexico, and Washington.
In addition to revenues generated from sales of RNG and conventional natural gas as a vehicle fuel and Environmental Credits, we also generate revenues by providing O&M services for public and private RNG, natural gas and hydrogen vehicle fleet customer stations; selling and servicing compressors and other equipment used in RNG production and at RNG, natural gas and hydrogen stations; and obtaining federal, state and local tax credits, grants and incentives. 11 Table of Contents We are experts in the engineering, design and construction of fueling stations.
In addition to revenues generated from sales of RNG and conventional natural gas as a vehicle fuel and Environmental Credits, we also generate revenues by providing O&M services for public and private RNG, natural gas and hydrogen vehicle fleet customer stations; selling and servicing compressors and other equipment used in RNG production and at RNG, natural gas and hydrogen stations; and obtaining federal, state and local tax credits, grants and incentives.
We also assist our customers in their transition to cleaner transportation fuels by helping them obtain federal, state and local tax credits, grants and incentives, providing vehicle financing, including through our Zero Now and Chevron Adopt-A-Port programs, engineering and constructing fueling stations, and facilitating customer selection of vehicle specifications that best meet their needs.
We also assist our customers in their transition to cleaner transportation fuels by helping them obtain federal, state and local tax credits, grants and incentives, providing vehicle financing, including through multiple marketing and incentive programs, engineering and constructing fueling stations, and facilitating customer selection of vehicle specifications that best meet their needs.
By extension, we incorporate our EHS standards into our subcontractor selection qualifications to ensure that our commitment to high EHS standards is shared by our subcontractors. For 2023, our Total Recordable Incident Rate (“TRIR”) was 1.89, which is lower than the 2022 national average of 3.0 TRIR for all industries.
By extension, we incorporate our EHS standards into our subcontractor selection qualifications to ensure that our commitment to high EHS standards is shared by our subcontractors. For 2024, our Total Recordable Incident Rate (“TRIR”) was 1.98, which is lower than the 2023 national average of 2.7 TRIR for all industries.
The number of Environmental Credits we sell and our revenue from these sales can vary depending on a number of factors, including the market for these credits, which has been volatile and subject to significant price fluctuations in recent periods (for example, in 2023, market prices for RINs were as high as $3.55 and as low as $1.88), any changes to the federal and state programs under which the credits are generated and sold, and our ability to strictly comply with these programs.
The number of Environmental Credits we sell and our revenue from these sales can vary depending on a number of factors, including the market for these credits, which has been volatile and subject to significant price fluctuations in recent periods (for example, in 2024, market prices for RINs were as high as $3.57 and as low as $2.08 and market prices for LCFS Credits were as high as $78.50 and low as $40.00), any changes to the federal and state programs under which the credits are generated and sold, and our ability to strictly comply with these programs.
According to NGV America, a national organization dedicated to the development of a growing, profitable, and sustainable market for vehicles powered by RNG, in 2022, “RNG use as a transportation fuel increased 218% from 2018 levels, and RNG use as a motor fuel displaced 5.63 million metric tons of carbon dioxide equivalent.” Further, RNG engines now commercially available for heavy-duty, regional-haul, refuse, transit, and vocational applications have been certified to satisfy CARB’s optional low nitrogen oxide (“NOx”) emission standard of 0.02 g/bhp-hr.
According to The Transport Project, a national organization dedicated to the development of a growing, profitable, and sustainable market for vehicles powered by alternative fuels, in 2023, “RNG use as a transportation fuel increased 92% from 2019 levels, and RNG use as a motor fuel displaced 6.96 million metric tons of carbon dioxide equivalent.” Further, RNG engines now commercially available for heavy-duty, regional-haul, refuse, transit, and vocational applications have been certified to satisfy CARB’s optional low nitrogen oxide (“NOx”) emission standard of 0.02 g/bhp-hr.
RNG made up 89% of our vehicle fuel sales in 2023, and we expect 100% of our vehicle fuel sales to be RNG by 2025. Although RNG has the same chemical composition as natural gas from fossil sources, it has unique Environmental Credits assigned to it due to its origin from low- and negative-carbon, renewable sources.
RNG volume made up 89% of our vehicle fuel sales in 2024, and our goal is for 100% of our vehicle fuel sales to be RNG. Although RNG has the same chemical composition as natural gas from fossil sources, it has unique Environmental Credits assigned to it due to its origin from low- and negative-carbon, renewable sources.
We believe we were the first organization to supply RNG for vehicle fuel use in the U.S., and sales of our RNG for such purpose have increased from 13.0 million gasoline gallon equivalents (“GGEs”) in 2013 to 225.7 million GGEs in 2023.
We believe we were the first organization to sell RNG as a vehicle fuel in the U.S., and sales of our RNG for such purpose have increased from 13.0 million gasoline gallon equivalents (“GGEs”) in 2013 to 236.7 million GGEs in 2024.
When we build stations for customers, we charge construction, other fees, or lease rates based on the size and complexity of the project.
We are experts in the engineering, design and construction of fueling stations. When we build stations for customers, we charge construction, other fees, or lease rates based on the size and complexity of the project.
We are focused on fueling more heavy-duty trucks, and many well-known shippers, manufacturers, retailers and other truck fleet operators have started to use RNG fueled trucks to move their freight, including, among others, Amazon, Pepsi Frito-Lay, FedEx, Anheuser-Busch, USPS, UPS, Kroger, KeHe Distributors, Kenan Advantage Group, and Estes Express.
We are focused on fueling more heavy-duty trucks, and many well-known shippers, manufacturers, retailers and other truck fleet operators have started to use RNG fueled trucks to move their freight, including, among others, Amazon, Pepsi Frito-Lay, FedEx, Anheuser-Busch, USPS, UPS, Kroger, KeHe Distributors, Kenan Advantage Group, and Estes Express. 12 Table of Contents California RNG Fleet Fund Clean Energy’s California Fleet Fund is an incentive program to help California fleets transition to RNG.
The Pickens Plant can produce 28.0 million gallons of LNG per year and includes a tanker trailer loading system and a 1.0 million gallon storage tank that can hold up to 840,000 usable gallons. In 2023, we produced 83% of our LNG at our plants and purchased the remainder of our LNG from third-party suppliers.
The Pickens Plant can produce 36.5 million gallons of LNG per year and includes a tanker trailer loading system and a storage tank that can hold up to 830,000 usable gallons. In 2024, we produced 93% of our LNG at our plants and purchased the remainder of our LNG from third-party suppliers.
We believe that during 2023 we provided 53% and 47% of the RNG used for transportation fuel in California and the U.S., respectively.
We believe that during 2024 we provided 50% and 39% of the RNG used for transportation fuel in California and the U.S., respectively.
From inception to December 31, 2023, we and bp have collectively contributed approximately $455.5 million of equity to the bpJV. Currently, there are five ADG RNG projects under construction, which are planned to be substantially complete between the first quarter of 2024 and the first quarter of 2025, and one ADG RNG project, located at Drumgoon Dairy, in operation.
From inception to December 31, 2024, we and bp have collectively contributed approximately $455.5 million of equity to the bpJV. Currently, there are five ADG RNG projects in operation and one large ADG RNG project under construction, which is planned to be completed by the fourth quarter of 2025.
The transitioning of California’s energy markets to increased reliance on renewable and carbon-free sources has the potential to create favorable market conditions for RNG but could also harm our vehicle fueling business. Future regulatory actions will be required to meet the state’s zero-emission and carbon neutrality targets.
The transitioning of California’s energy markets to increased reliance on renewable and carbon-free sources has the potential to create favorable market conditions for RNG but could also harm our vehicle fueling business.
To succeed in a competitive labor market, we have developed and maintain key recruitment and retention strategies. These include competitive salary structures, including bonus compensation programs, and competitive benefits policies, including paid time off for vacations, sick leave and holidays, short-term disability coverage, group term life insurance, and various retirement savings and incentive plans.
These include competitive salary structures, including bonus compensation programs, and competitive benefits policies, including paid time off for vacations, sick leave and holidays, short-term disability coverage, group term life insurance, and various retirement savings and incentive plans.
We believe that we have one of the largest and most diverse supply portfolios in the RNG industry, which allows us to provide certainty of RNG supply to our vehicle operator customers.
We believe that we have one of the largest and most diverse supply portfolios in the RNG industry, which allows us to provide certainty of RNG supply to our vehicle operator customers. In our view, all the foregoing gives us a competitive advantage relative to existing and new market entrants.
Additionally, we have 13 registered trademarks, including 10 trademarks registered with the USPTO and 3 trademarks registered with the CIPO, expiring between 2024 and 2032, and 2 trademark applications pending, including 1 trademark application filed with the USPTO and 1 trademark application filed with the CIPO. More Information Our website is located at www.cleanenergyfuels.com.
Additionally, we have 12 registered trademarks, including 9 trademarks registered with the USPTO and 3 trademarks registered with the CIPO, expiring between 2025 and 2034, and 6 trademark applications pending, including 3 trademark applications pending with the USPTO and 3 trademark applications pending with the CIPO. More Information Our website is located at www.cleanenergyfuels.com.
In addition, the Clean Water Act and implementing state laws and regulations require individual permits or coverage under general permits for discharges of storm water runoff from certain types of facilities. 15 Table of Contents On September 23, 2020, the California Governor issued an Executive Order N-79-20 setting goals for expanding the sale and use of zero-emission vehicles within California, including 100% of in-state sales of new passenger cars and trucks to be zero-emission by 2035, and 100% of medium- and heavy-duty truck vehicles in California to be zero-emission by 2045 for all operations where feasible.
On September 23, 2020, the California Governor issued an Executive Order N-79-20 setting goals for expanding the sale and use of zero-emission vehicles within California, including 100% of in-state sales of new passenger cars and trucks to be zero-emission by 2035, and 100% of medium- and heavy-duty truck vehicles in California to be zero-emission by 2045 for all operations where feasible.
We support this objective through a multi-pronged strategy of: ● promoting the reduction of GHG emissions and expanding the use of renewable fuels to displace fossil-based fuels; ● increasing supply of RNG through the development of new project investment opportunities, expanding our existing supplier portfolio, and leveraging our existing fuel network and customer relationships; ● empowering our customers to achieve their sustainability and carbon reduction objectives; ● leveraging our management expertise; and 9 Table of Contents ● utilizing our environmental, health and safety and compliance leadership. ​ Promoting the reduction of methane emissions and expanding the use of renewable fuels to displace fossil-based fuels.
We support this objective through a multi-pronged strategy of: ● promoting the adoption by fleets of the Cummins X15N natural gas engine; ● promoting the environmental and economic benefits of RNG for fleet vehicles; ● increasing supply of RNG through the development of new project investment opportunities, expanding our existing supplier portfolio, and leveraging our existing fuel network and customer relationships; ● empowering our customers to achieve their sustainability and carbon reduction objectives; ● leveraging our management expertise; and ● utilizing our environmental, health and safety and compliance leadership. ​ Promoting the adoption by fleets of the Cummins X15N natural gas engine.
Currently, two of our nine directors are female, and one of our nine directors identify as being members of an ethnic minority. Safety of our personnel is a core value of Clean Energy and maintaining a safe work environment is critical to an energy company’s ability to attract and retain employees.
Safety of our personnel is a core value of Clean Energy and maintaining a safe work environment is critical to an energy company’s ability to attract and retain employees.
Under a 50-50 shared investment, we and Tourmaline expect to construct and commission up to 20 CNG fueling stations over the next five years, allowing heavy-duty trucks and other commercial transportation fleets that operate in the area to transition to the use of CNG, a lower carbon alternative to gasoline and diesel.
Under a 50-50 shared investment, the construction of these CNG fueling stations will allow heavy-duty trucks and other commercial transportation fleets that operate in the area to transition to the use of CNG, a lower carbon and NOx alternative to gasoline and diesel.
For more information, see the discussion under “Seasonality and Inflation” in Item 7.
Seasonality To some extent, our business may experience seasonality. For more information, see the discussion under “Seasonality and Inflation” in Item 7.
During the years ended December 31, 2021, 2022 and 2023, no single customer accounted for 10% or more of our total revenue. Trucking We believe heavy-duty trucking represents the greatest opportunity for RNG and other alternatives to be used as a vehicle fuel.
During the years ended December 31, 2022, 2023 and 2024, zero, zero and one customer accounted for 10% or more of our total revenue, respectively. Trucking We believe heavy-duty trucking represents the greatest opportunity for the expansion of RNG fueling.
Our sales and marketing team also work closely with federal, state and local government agencies to provide education about the value of our vehicle fuels and to keep abreast of proposed and newly adopted regulations that affect our industry. Seasonality To some extent, our business may experience seasonality.
Our sales and marketing team also work closely with federal, state and local government agencies to provide education about the value of our vehicle fuels and to keep abreast of proposed and newly adopted regulations that affect our industry. We also do paid advertising in outlets that reach the transportation markets and have an active social media presence.
Use of environmental credits to promote RNG growth When used as a transportation fuel, RNG generates additional revenue streams through Environmental Credits. These Environmental Credits are provided under a variety of programs, including the national Renewable Fuel Standards (“RFS”), and state-level Low Carbon Fuel Standard (“LCFS”) programs.
These Environmental Credits are provided under a variety of programs, including the national Renewable Fuel Standards (“RFS”), and state-level Low Carbon Fuel Standard (“LCFS”) programs. The RFS program requires transportation fuel to contain a minimum volume of renewable fuel.
It is important that we build a leadership 6 Table of Contents team and supplier base that are reflective of the communities in which we operate. We acknowledge the lack of diversity in the energy sector and strive to be part of the solution. Advancing smart policies that drive the transformation to zero carbon fuels.
It is important that we build a leadership team and supplier base that are reflective of the communities in which we operate. 6 Table of Contents Advancing smart policies that drive the transformation to zero carbon fuels. Widespread change will be necessary across all industries to achieve our collective climate goals while maintaining a vibrant economy.
We are committed to the sustainable development, deployment, and utilization of RNG to reduce the country’s dependence on fossil fuels. In addition to its methane emission benefits, the increased production and use of RNG have several other environmental benefits. Anaerobically digested livestock waste produces significantly less odor than conventional storage and land application systems.
By simultaneously replacing fossil-based fuels and reducing overall methane emissions, our business has a substantial positive environmental impact. In addition to its methane emission benefits, the increased production and use of RNG have several other environmental benefits. Anaerobically digested livestock waste produces significantly less odor than conventional storage and land application systems.
Obligated Parties can comply with RVOs by either blending RNG into their existing fuel supply or purchasing Renewable Identification Numbers, or RINs. RINs are generated when eligible renewable fuels are produced or imported and blended with a petroleum product for use as a transportation fuel.
RINs are generated when eligible renewable fuels are produced or imported and blended with a petroleum product for use as a transportation fuel.
Widespread change will be necessary across all industries to achieve our collective climate goals. We recognize that some physical climate impacts are unavoidable in the near-term and that the transition to a low carbon economy may bring new risks to our business.
We recognize that some physical climate impacts are unavoidable in the near-term and that the transition to a low carbon economy may bring new risks to our business. We also recognize that natural gas extraction and processing causes environmental and social impacts that must be appropriately managed.
We also recognize that natural gas extraction and processing causes environmental and social impacts that must be appropriately managed. By investing in the energy transition, our aim is to reduce our own risks and provide lasting benefits to society.
By investing in the energy transition, our aim is to reduce our own risks and provide lasting benefits to society.
In 2023, customers contracted 95 trucks under Adopt-A-Port, and we expect 96 additional trucks to be ordered in 2024. Airports We estimate that vehicles serving airports in the U.S., including airport delivery fleets, rental car and parking passenger shuttles and taxis, consume an aggregate of approximately two billion gallons of fuel per year.
Airports We estimate that vehicles serving airports in the U.S., including airport delivery fleets, rental car and parking passenger shuttles and taxis, consume an aggregate of approximately two billion gallons of fuel per year. Additionally, many U.S. airports face emissions challenges and are under regulatory directives and political pressure to reduce pollution, particularly as part of any expansion plans.
As of December 31, 2023, we served over 1,000 fleet customers operating over 50,000 vehicles on our fuels. We believe we are the only company in the U.S. that provides RNG vehicle fuel at scale in California and nationally. 4 Table of Contents Longer term, we plan to expand availability of hydrogen fuel for vehicle fleets.
We believe we are the only company in the U.S. that provides RNG vehicle fuel at scale in California and nationally. 4 Table of Contents Recently, we have expanded our offering to include hydrogen fuel for vehicle fleets and have won multiple competitive bids to build hydrogen stations for California transit agencies.
The RFS program requires transportation fuel to contain a minimum volume of renewable fuel. To fulfill this regulatory mandate, the EPA obligates refiners and importers (“Obligated Parties”) to blend renewable fuel with standard fuel to meet renewable volume obligations (“RVOs”).
To fulfill this regulatory mandate, the EPA obligates refiners and importers (“Obligated Parties”) to blend renewable fuel with standard fuel to meet renewable volume obligations (“RVOs”). Obligated Parties can comply with RVOs by either blending RNG into their existing fuel supply or purchasing Renewable Identification Numbers, or RINs.
The Governor also directed CARB to develop and propose regulations to achieve these goals consistent with state and federal law. This order is the latest in a series of targets set by California to transform the energy and transportation fuel sectors and reduce GHG emissions. Executive Order B55-18 sets a statewide target to achieve carbon neutrality no later than 2045.
The Governor also directed CARB to develop and propose regulations to achieve these goals consistent with state and federal law.
Removed
The RNG project at Drumgoon Dairy is designed to produce approximately 1.7 million GGEs of RNG annually when at full capacity.
Added
As of December 31, 2024, we served over 1,000 fleet customers operating over 50,000 vehicles on our fuels.
Removed
We share the renewable fuel industry’s commitment to provide sustainable renewable energy solutions and to offer products with high economic and ecological value. By simultaneously replacing fossil-based fuels and reducing overall methane emissions, our business has a substantial positive environmental impact.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeOur results of operations have historically experienced, and may continue to experience, significant fluctuations as a result of a variety of factors, including, among others, the amount and timing of our vehicle fuel sales, Environmental Credit sales and recognition of government credits, station construction sales, grants and incentives, such as AFTC (for example, we recorded all of the AFTC revenue associated with our vehicle fuel sales made in the first and second quarters of 2022 during the third quarter of 2022); fluctuations in commodity, station construction and labor costs; fluctuations in expenditures and resource commitments due to new ADG RNG project developments; variations in the fair value of certain of our derivative instruments that are recorded in revenue; sales of compressors and other equipment used in RNG production and at fueling stations; the amount and timing of our billing, collections and liability payments; and the other factors described in these risk factors. 24 Table of Contents Our performance in certain periods has also been affected by transactions or events that have resulted in significant cash or non-cash gains or losses.
Biggest changeOur results of operations have historically experienced, and may continue to experience, significant fluctuations as a result of a variety of factors, including, among others, the amount and timing of our vehicle fuel sales, Environmental Credit sales and recognition of government credits, station construction sales, grants and incentives, such as AFTC, which expired on December 31, 2024 and has not been renewed (for example, we recorded all of the AFTC revenue associated with our vehicle fuel sales made in the first and second quarters of 2022 during the third quarter of 2022); fluctuations in commodity, station construction and labor costs, including as a result of increased and/or new tariffs on equipment supply and raw materials; fluctuations in expenditures and resource commitments due to new ADG RNG project developments; variations in the fair value of certain of our derivative instruments that are recorded in revenue; sales of compressors and other equipment used in RNG production and at fueling stations; the amount and timing of our billing, collections and liability payments; weather and seasonality; and the other factors described in these risk factors.
Our outstanding and any future indebtedness could make us more vulnerable to adverse changes in general U.S. and worldwide economic, including rising interest rates, regulatory, and competitive conditions, limit our flexibility to plan for or react to changes in our business or industry, place us at a disadvantage compared to our competitors that have less debt, or limit our ability to borrow or otherwise raise additional capital as needed.
Our outstanding and any future indebtedness could make us more vulnerable to adverse changes in general U.S. and worldwide economic conditions, including rising interest rates, regulatory, and competitive conditions, limit our flexibility to plan for or react to changes in our business or industry, place us at a disadvantage compared to our competitors that have less debt, or limit our ability to borrow or otherwise raise additional capital as needed.
Factors that may influence the adoption of our vehicle fuels, many of which are beyond our control, include, among others: lack of demand for trucks that use our vehicle fuels; adoption or expansion of government policies, programs, funding or incentives, or increased publicity or popular sentiment in favor of vehicles or fuels other than RNG and natural gas, including long-standing support for diesel-powered vehicles, changes to emissions requirements applicable to vehicles and fleets powered by diesel, RNG, natural gas, or other vehicle fuels and/or growing support for electric and hydrogen-powered vehicles; limitations on the capabilities of utilities to provide services to meet our requirements.
Factors that may influence the adoption of our vehicle fuels, many of which are beyond our control, include, among others: lack of demand for trucks that use our vehicle fuels; adoption or expansion of government policies, programs, funding or incentives, or increased publicity or popular sentiment in favor of vehicles or fuels other than RNG and natural gas, including long-standing support for diesel-powered vehicles, changes to emissions requirements applicable to vehicles and fleets powered by diesel, RNG, natural gas, or other vehicle fuels and/or growing support for renewable diesel, electric and hydrogen-powered vehicles; and limitations on the capabilities of utilities to provide services to meet our requirements.
For example, natural gas utilities may be unable to expand piping or provide services for new expansions, and electric utilities may lack the capacity to provide service for our projects; perceptions about the benefits of our vehicle fuels relative to diesel and other alternative vehicle fuels, including with respect to factors such as supply, cost savings, environmental benefits and 17 Table of Contents safety; increases, decreases or volatility in the supply, demand, use and prices of crude oil, diesel, RNG, natural gas and other vehicle fuels, such as electricity, hydrogen, renewable diesel, biodiesel and ethanol; inertia among fleets and fleet vehicle operators, who may be unable or unwilling to prioritize converting a fleet to our vehicle fuels over an operator’s other general business concerns, particularly if the operator is not sufficiently incentivized by emissions regulations or other requirements or lacks demand for the conversion from its customers, drivers, or other stakeholders; vehicle cost, fuel efficiency, availability, quality, safety, convenience (to fuel and service), design, performance and residual value, as well as operator perception with respect to these factors, generally and in our key customer markets and relative to comparable vehicles powered by other fuels; the development, production, cost, availability, performance, sales and marketing and reputation of engines that are well-suited for the vehicles used in our key customer markets, including heavy-duty trucks and other fleets; increasing competition in the market for vehicle fuels generally, and the nature and effect of competitive developments in this market, including improvements in or perceived advantages of other vehicle fuels and engines powered by these fuels; the impact of federal or state laws, orders or regulations mandating new or additional limits on GHG emissions, “tailpipe” emissions or internal combustion engines, including the Advanced Clean Trucks regulation, the September 2020 Executive Order, the Advanced Clean Fleets regulation and the 2021 Executive Order (each as defined below); the availability and effect of environmental, tax or other government regulations, programs or incentives that promote our products or other alternatives as a vehicle fuel, including certain programs under which we generate credits by selling RNG as a vehicle fuel, as well as the market prices for such credits; and emissions and other environmental regulations and pressures on producing, transporting, and dispensing our fuels.
For example, natural gas utilities may be unable to expand piping or provide services for new expansions, and electric utilities may lack the capacity to provide service for our projects; perceptions about the benefits of our vehicle fuels relative to diesel and other alternative vehicle fuels, including with respect to factors such as supply, cost savings, environmental benefits and safety; increases, decreases or volatility in the supply, demand, use and prices of crude oil, diesel, RNG, natural gas and other vehicle fuels, such as electricity, hydrogen, renewable diesel, biodiesel and ethanol; inertia among fleets and fleet vehicle operators, who may be unable or unwilling to prioritize converting a fleet to our vehicle fuels over an operator’s other general business concerns, particularly if the operator is not sufficiently incentivized by emissions regulations or other requirements or lacks demand for the conversion from its customers, drivers, or other stakeholders; vehicle cost, fuel efficiency, availability, quality, safety, convenience (to fuel and service), design, performance and residual value, as well as operator perception with respect to these factors, generally and in our key customer markets and relative to comparable vehicles powered by other fuels; the development, production, cost, availability, performance, sales and marketing and reputation of engines that are well-suited for the vehicles used in our key customer markets, including heavy-duty trucks and other fleets; increasing competition in the market for vehicle fuels generally, and the nature and effect of competitive developments in this market, including improvements in or perceived advantages of other vehicle fuels and engines powered by these fuels; the impact of federal or state laws, orders or regulations mandating new or additional limits on GHG emissions, “tailpipe” emissions or internal combustion engines, including the Advanced Clean Trucks regulation, the September 2020 Executive Order, the Advanced Clean Fleets regulation and the 2021 Executive Order (each as defined below); the availability and effect of environmental, tax or other government regulations, programs or incentives that promote our products or other alternatives as a vehicle fuel, including certain programs under which we generate credits by selling RNG as a vehicle fuel, as well as the market prices for such credits; and emissions and other environmental regulations and pressures on producing, transporting, and dispensing our fuels.
Changes to the use of our assets, divestitures, changes to the structure of our business, significant negative industry or economic trends, disruptions to our operations, inability to effectively integrate any acquired businesses, further market capitalization declines, or other similar actions or conditions could result in additional asset impairment or goodwill impairment charges or other adverse consequences, any of which could have material negative effects on our financial condition, our results of operations and the trading price of our common stock.
In addition, changes to the use of our assets, divestitures, changes to the structure of our business, significant negative industry or economic trends, disruptions to our operations, inability to effectively integrate any acquired businesses, further market capitalization declines, or other similar actions or conditions could result in additional asset impairment or goodwill impairment charges or other adverse consequences, any of which could have material negative effects on our financial condition, our results of operations and the trading price of our common stock.
Any future pandemic, epidemic, or infectious disease outbreak could also adversely affected our business through delaying the adoption of our RNG and natural gas vehicle fuels by heavy-duty trucks and/or a delaying increased usage of our vehicle fuels; decreasing the volume of truck and fleet operations, including shuttle buses at airports, and public transportation generally, and disrupting production of vehicles and engines that use our fuels.
Any future pandemic, epidemic, or infectious disease outbreak could also adversely affected our business through delaying the adoption of our RNG and natural gas vehicle fuels by heavy-duty trucks and/or a delaying increased usage of our vehicle fuels; decreasing the volume of truck and fleet operations, including shuttle buses at airports, refuse trucks, and public transportation generally, and disrupting production of vehicles and engines that use our fuels.
The market for our vehicle fuels has experienced slow, volatile and unpredictable growth in many sectors. For example, adoption and deployment of our vehicle fuels in heavy-duty trucking has been slower and more limited than we anticipated. Also, other important fleet markets, including airports and public transit, had slower volume and customer growth in recent years that may continue.
The market for our vehicle fuels has experienced slow, volatile and unpredictable growth in many sectors. For example, adoption and deployment of our vehicle fuels in heavy-duty trucking has been slower and more limited than we anticipated. Also, other important fleet markets, including airports, refuse, and public transit, had slower volume and customer growth in recent years that may continue.
We also must certify RNG pathways with CARB, which typically takes from 15-18 months from first injection of RNG into the commercial pipeline system. Delays in obtaining registration, RIN qualification, and any LCFS credit qualification of a new project could delay future revenues from a project and could adversely affect our cash flow.
We also must certify RNG pathways with CARB, which typically takes from 15 to 18 months from first injection of RNG into the commercial pipeline system. Delays in obtaining registration, RIN qualification, and any LCFS credit qualification of a new project could delay future revenues from a project and could adversely affect our cash flow.
In June 2020, CARB adopted the Advanced Clean Trucks regulation, which requires manufacturers to sell a gradually increasing proportion of zero-emission electric trucks, vans and pickup trucks from 2024 onwards. By the year 2045, the Advanced Clean Trucks regulation seeks to have every new commercial vehicle sold in California be zero-emissions.
In June 2020, CARB adopted the Advanced Clean Trucks regulation, which requires manufacturers to sell a gradually increasing proportion of zero-emission electric trucks, vans and pickup trucks from 2024 onwards. By the year 2045, the Advanced Clean Trucks (the “ACT”) regulation seeks to have every new commercial vehicle sold in California be zero-emissions.
If new debt were to be incurred in the future, the related risks that we now face could intensify. The Credit Agreement requires us and our subsidiaries, on a consolidated basis, to comply with a maximum total net leverage ratio, a minimum interest coverage ratio, and a minimum liquidity test.
If new debt were to be incurred in the future, the related risks that we now face could intensify. The Stonepeak Credit Agreement requires us and our subsidiaries, on a consolidated basis, to comply with a maximum total net leverage ratio, a minimum interest coverage ratio, and a minimum liquidity test.
Further, a cybersecurity incident could occur and persist for an extended period of time without detection, and an investigation of any successful cybersecurity incident would likely require significant time, costs and other resources to complete. We may be required to expend significant financial resources to protect against or to remediate such cybersecurity incidents.
A cybersecurity incident could occur and persist for an extended period without detection, and an investigation of any successful cybersecurity incident would likely require significant time, costs and other resources to complete. We may be required to expend significant financial resources to protect against or to remediate such cybersecurity incidents.
In addition, the Credit Agreement contains certain covenants that limit or restrict our and our subsidiaries’ ability to incur liens, incur indebtedness, dispose of assets, make investments, make certain restricted payments, merge or consolidate, amend our charter documents and certain other agreements, and enter into speculative hedging arrangements.
In addition, the Stonepeak Credit Agreement contains certain covenants that limit or restrict our and our subsidiaries’ ability to incur liens, incur indebtedness, dispose of assets, make investments, make certain restricted payments, merge or consolidate, amend our charter documents and certain other agreements, and enter into speculative hedging arrangements.
Implementation of such regulations and executive actions may slow, delay or prevent the adoption by fleets and other commercial customers of our vehicle fuels, particularly in California. Moreover, other states have taken steps to enact similar regulations, which may slow, delay, change, or prevent the adoption of our vehicle fuels in those states as well.
Implementation of such regulations and executive actions may slow, delay or prevent the adoption by fleets and other commercial customers of our vehicle fuels, particularly in California. Moreover, other states have enacted, or have taken steps to enact, similar regulations, which may slow, delay, change, or prevent the adoption of our vehicle fuels in those states as well.
Subject to additional vesting through fuel purchase from the Company pursuant to the Fuel Agreement, the Amazon Warrant will be exercisable for up to 19.999% of our outstanding common stock on a fully diluted basis (determined at the time of issuance), subject to certain anti-dilution provisions, and Amazon Holding’s beneficial ownership will initially be contractually limited to the beneficial ownership limitation unless Amazon Holdings gives the Company sixty one (61) days’ notice that it is waiving such limitation.
Subject to additional vesting through fuel purchase from the Company pursuant to the Fuel Agreement, the Amazon Warrant will be exercisable for up to 19.999% of our outstanding common stock on a fully diluted basis (determined at the time of issuance), subject to certain anti-dilution provisions, and Amazon Holding’s beneficial ownership will initially be contractually limited to the beneficial ownership limitation unless Amazon Holdings gives the Company 61 days’ notice that it is waiving such limitation.
NG Advantage faces unique risks, including among others: (i) it has a history of net losses and has incurred substantial indebtedness; (ii) NG Advantage may need to raise additional capital, which may not be available, may only be available on onerous terms, or may only be available from the Company; (iii) the labor market for truck drivers is very competitive, which increases NG Advantage’s difficulty in meeting its delivery obligations; (iv) NG Advantage often transports CNG in trailers over long distances and these trailers may be involved in accidents; and (v) NG Advantage’s CNG trailers may become subject to new or changed regulations that could adversely affect its business.
NG Advantage faces unique risks, including among others: (i) it has a history of net losses; (ii) NG Advantage may need to raise additional capital, which may not be available, may only be available on onerous terms, or may only be available from the Company; (iii) the labor market for truck drivers is very competitive, which increases NG Advantage’s difficulty in meeting its delivery obligations; (iv) NG Advantage often transports CNG in trailers over long distances and these trailers may be involved in accidents; and (v) NG Advantage’s CNG trailers may become subject to new or changed regulations that could adversely affect its business.
The Stonepeak Warrant is exercisable at any time after December 12, 2025 for up to 9.999% of our common stock outstanding immediately after giving effect to such exercise, and Stonepeak’s beneficial ownership will initially be contractually limited to such beneficial ownership limitation unless Stonepeak gives the Company sixty one (61) days’ notice that it is waiving such limitation.
The Stonepeak Warrant is exercisable at any time after December 12, 2025 for up to 9.999% of our common stock outstanding immediately after giving effect to such exercise, and Stonepeak’s beneficial ownership will initially be contractually limited to such beneficial ownership limitation unless Stonepeak gives the Company 61 days’ notice that it is waiving such limitation.
If the prices of crude oil and diesel are low or decline, or if the price of RNG or natural gas increases without corresponding increases in the prices of crude oil and diesel or Environmental Credits, we may not be able to offer our customers an attractive price for our vehicle fuels, market adoption of our vehicle fuels could be slowed or limited and/or we may be forced to reduce the prices at which we sell our vehicle fuels in order to try to attract new customers or prevent the loss of demand from existing customers.
If the prices of crude oil and diesel are low or decline, or if the price of RNG or natural gas increases without corresponding increases in the prices of crude oil and diesel or Environmental 21 Table of Contents Credits, we may not be able to offer our customers an attractive price for our vehicle fuels, market adoption of our vehicle fuels could be slowed or limited and/or we may be forced to reduce the prices at which we sell our vehicle fuels in order to try to attract new customers or prevent the loss of demand from existing customers.
Our plans for hydrogen and electric vehicle stations will require significant cash investments and management resources and may not meet our expectations. As operators deploy hydrogen powered vehicles, we plan to modify our fueling stations to reform our RNG, build additional hydrogen stations, and deliver clean hydrogen.
Our plans for hydrogen and electric vehicle stations will require significant cash investments and management resources and may not meet our expectations. As operators deploy hydrogen powered vehicles, we plan to modify our fueling stations, build additional hydrogen stations, and deliver clean hydrogen.
All these factors, and in particular, expenditures on development of projects that will not generate significant revenue in the near term, can contribute to fluctuations in our financial performance and increase the likelihood that our operating results in a particular period will fall below investor expectations. 20 Table of Contents Livestock waste and dairy farm projects are dependent on LCFS credits and RINS.
All these factors, and in particular, expenditures on development of projects that will not generate significant revenue in the near term, can contribute to fluctuations in our financial performance and increase the likelihood that our operating results in a particular period will fall below investor expectations. Livestock waste and dairy farm projects are dependent on LCFS credits and RINS.
Any failure to adopt, delay in implementing, expiration, repeal or modification of these programs and regulations, or the adoption of any programs or regulations that encourage the use of other alternative fuels or alternative vehicles over RNG, could reduce the market for RNG as a vehicle fuel and harm our operating results, liquidity, and financial condition.
Any failure to adopt, delay in implementing, expiration, 27 Table of Contents repeal or modification of these programs and regulations, or the adoption of any programs or regulations that encourage the use of other alternative fuels or alternative vehicles over RNG, could reduce the market for RNG as a vehicle fuel and harm our operating results, liquidity, and financial condition.
If any of these enforcement measures were imposed on us, our business, financial condition, and performance could be negatively affected. 28 Table of Contents Our operations entail inherent safety and environmental risks, which may result in substantial liability to us. Our operations entail inherent safety risks, including risks associated with equipment defects, malfunctions, failures, and misuses.
If any of these enforcement measures were imposed on us, our business, financial condition, and performance could be negatively affected. Our operations entail inherent safety and environmental risks, which may result in substantial liability to us. Our operations entail inherent safety risks, including risks associated with equipment defects, malfunctions, failures, and misuses.
Reductions in spending, delays in purchasing decisions, lack of renewals, inability to attract new customers, uncertainty about business continuity as well as pressure for extended billing terms or pricing discounts, could limit our ability to grow our business and negatively affect our operating results and financial condition.
Reductions in spending, delays in purchasing decisions, lack of renewals, inability to attract new customers, 17 Table of Contents uncertainty about business continuity as well as pressure for extended billing terms or pricing discounts, could limit our ability to grow our business and negatively affect our operating results and financial condition.
Moreover, government entities with which we contract are often able to modify, curtail or terminate contracts with us at their convenience and without prior notice, and would only be required to pay for work completed and commitments made at or prior to the time of termination.
Moreover, government entities with which we contract are 24 Table of Contents often able to modify, curtail or terminate contracts with us at their convenience and without prior notice, and would only be required to pay for work completed and commitments made at or prior to the time of termination.
If these shares are sold, or if it is perceived that they may be sold, in the public market, the trading price of our common stock could decline. The price of our common stock may continue to fluctuate significantly, and you could lose all or part of your investment.
If these shares are sold, or if it is perceived that they may be sold, in the public market, the trading price of our common stock could decline. 30 Table of Contents The price of our common stock may continue to fluctuate significantly, and you could lose all or part of your investment.
In addition, other factors related to the development and operation of renewable energy projects could adversely affect our business, including: (i) changes in pipeline gas quality standards or other regulatory changes that may limit our ability to transport RNG on pipelines for delivery to vehicles or increase the costs of processing RNG to allow for such deliveries; (ii) construction risks, including the risk of delay, that may arise because of inclement weather, natural disasters, accidents, labor disruptions, disputes, or increases in costs for or shortages of equipment and construction materials; (iii) operating risks; (iv) weather conditions; (v) financial condition of the applicable source owner; (vi) health of the applicable dairy herd; (vii) consolidation in the dairy industry; (viii) budget overruns; (ix) possible liabilities because of unforeseen environmental, construction, technological or other complications; (x) failures or delays in obtaining desired or necessary rights, including leases and feedstock agreements; and (xi) failures or delays in obtaining and keeping in good standing permits, authorizations and consents from local city, county, state and U.S. federal governments as well as local and U.S. federal governmental organizations.
In addition, other factors related to the development and operation of renewable energy projects could adversely affect our business, including: (i) changes in pipeline gas quality standards or other regulatory changes that may limit our ability to transport RNG on pipelines for delivery to vehicles or increase the costs of processing RNG to allow for such deliveries; (ii) construction risks, including the risk of delay, that may arise because of inclement weather, natural disasters, accidents, labor disruptions, disputes, or increases in costs for or shortages of equipment and construction materials; (iii) operating risks; (iv) weather conditions; (v) financial condition of the applicable source owner, including obstacles to their ability to adequately fund their operations or pay vendors and creditors; (vi) health of the applicable dairy herd; (vii) consolidation in the dairy industry; (viii) budget overruns; (ix) possible liabilities because of unforeseen environmental, construction, technological or other complications; (x) failures or delays in obtaining desired or necessary rights, including leases and feedstock agreements; (xi) diseases and health crises; and (xii) failures or delays in obtaining and keeping in good standing permits, authorizations and consents from local city, county, state and U.S. federal governments as well as local and U.S. federal governmental organizations.
If we cannot meet our debt obligations from our operating cash flows, we may pursue one or more alternative measures. Any repayment of our debt with equity, however, would dilute the ownership interests of our existing stockholders. We are permitted under the Credit Agreement to incur additional debt under certain conditions.
If we cannot meet our debt obligations from our operating cash flows, we may pursue one or more alternative measures. Any repayment of our debt with equity, however, would dilute the ownership interests of our existing stockholders. We 26 Table of Contents are permitted under the Stonepeak Credit Agreement to incur additional debt under certain conditions.
If NG Advantage needs to raise additional capital and is not able to obtain financing from external sources, we may need to provide additional debt or equity capital to allow NG Advantage to satisfy its commitments and maintain operations. Our station construction activities subject us to business and operational risks.
If NG Advantage needs to raise additional capital and is not able to obtain financing from external sources, we may need to provide additional debt or equity capital to allow NG Advantage to satisfy its commitments and maintain operations. 23 Table of Contents Our station construction activities subject us to business and operational risks.
A significant decline in the value of LCFS credits could adversely affect our business, financial condition, and results of operations. We have a history of losses and may incur additional losses in the future.
A significant decline in the value of LCFS credits could adversely affect our business, financial condition, and results of operations. 20 Table of Contents We have a history of losses and may incur additional losses in the future.
Our ability to maintain an adequate supply of RNG is subject to risks affecting RNG production, including unpredictable production levels or other difficulties due to, among others, problems with equipment, severe weather, droughts, financial condition of the applicable ADG and LFG source 18 Table of Contents owner, health crises and pandemics, construction delays, technical difficulties, high operating costs, limited availability, unfavorable composition of collected feedstock gas, and plant shutdowns caused by upgrades, expansion or required maintenance.
Our ability to maintain an adequate supply of RNG is subject to risks affecting RNG production, including unpredictable production levels or other difficulties due to, among others, problems with equipment, severe weather, droughts, financial condition or bankruptcy or insolvency of the applicable ADG and LFG source owner, health crises and pandemics, construction delays, technical difficulties, high operating costs, limited availability, unfavorable composition of collected feedstock gas, and plant shutdowns caused by upgrades, expansion, required maintenance, or other operational issues.
After giving effect to the issuance of the Amazon Warrant and the Stonepeak Warrant (defined below), Total Marketing Services, SAS (“TMS”), a wholly owned subsidiary of TotalEnergies, owns approximately 19% of our outstanding shares of common stock as of December 31, 2023.
After giving effect to the issuance of the Amazon Warrant and the Stonepeak Warrant (defined below), Total Marketing Services, S.A.S (“TMS”), a wholly owned subsidiary of TotalEnergies, owns approximately 19% of our outstanding shares of common stock as of December 31, 2024.
We have, and expect to continue to seek, long-term fueling station construction, maintenance and fuel sale contracts with various government bodies, which accounted for 31%, 27% and 30% of our revenue in 2021, 2022 and 2023, respectively.
We have, and expect to continue to seek, long-term fueling station construction, maintenance and fuel sale contracts with various government bodies, which accounted for 27%, 30% and 22% of our revenue in 2022, 2023 and 2024, respectively.
Our ability to achieve our strategic plans will also depend on our ability to attract and retain additional qualified personnel. Recruiting key personnel in our industry is highly competitive and we cannot assure you that we will be able to do so.
Our ability to achieve our strategic plans will also depend on our ability to attract and retain additional qualified personnel. Recruiting key personnel in our industry is highly 25 Table of Contents competitive and we cannot assure you that we will be able to do so.
The acquisition, financing, construction and development of projects involves numerous risks, including: the ability to obtain financing for a project on acceptable terms or at all; difficulties in identifying, obtaining, and permitting suitable sites for new projects; failure to obtain all necessary rights to land access and use; inaccuracy of assumptions with respect to the cost and schedule for completing construction; inaccuracy of assumptions with respect to the biogas potential, including quality, volume, and asset life; delays in deliveries or increases in the price of equipment; permitting and other regulatory issues, license revocation and changes in legal requirements; increases in the cost of labor, labor disputes and work stoppages; potential business or financial stress of partners; failure to receive quality and timely performance of third-party or utility services; unforeseen engineering and environmental problems; cost overruns; accidents involving personal injury or the loss of life; and weather conditions, catastrophic events, including fires, explosions, earthquakes, droughts and acts of terrorism, and other force majeure events.
The acquisition, financing, construction and development of projects involves numerous risks, including: the ability to obtain financing for a project on acceptable terms or at all; difficulties in identifying, obtaining, and permitting suitable sites for new projects; failure to obtain all necessary rights to land access and use; inaccuracy of assumptions with respect to the cost and schedule for completing construction; inaccuracy of assumptions with respect to the biogas potential, including quality, volume, and asset life; 19 Table of Contents delays in deliveries or increases in the price of equipment; permitting and other regulatory issues, license revocation and changes in legal requirements; increases in the cost of labor, labor disputes and work stoppages; potential business, financial stress or bankruptcy of partners or applicable source owners; failure to receive quality and timely performance of third-party or utility services; unforeseen engineering and environmental problems; cost overruns, including as a result of increased and/or new tariffs on equipment supply and raw materials; accidents involving personal injury or the loss of life; and weather conditions, catastrophic events, including fires, explosions, earthquakes, droughts and acts of terrorism, and other force majeure events.
We may incur substantial liability and costs if any such damages are not covered by insurance or are more than policy limits, or if environmental damage causes us to violate applicable GHG emissions or other environmental laws.
We may incur substantial liability and costs if any such damages are not covered by insurance or are more than our policy limits, or if environmental 29 Table of Contents damage causes us to violate applicable GHG emissions or other environmental laws.
If our vehicle 27 Table of Contents fuels are not able to meet GHG emission limits or perform as well as other alternative fuels and vehicles, our solutions could be less competitive.
If our vehicle fuels are not able to meet GHG emission limits or perform as well as other alternative fuels and vehicles, our solutions could be less competitive.
Any failure to maintain proper function, security and availability of our information systems and the data maintained in those systems could interrupt our operations, damage our reputation, subject us to liability claims or regulatory penalties, harm our business relationships or increase our security and insurance costs, which could have a material adverse effect on our business, financial condition and results of operations.
Non-compliance can result in significant legal and financial penalties and impact business operations Any failure to maintain proper function, security and availability of the information systems and the data maintained in those systems we use could interrupt our operations, damage our reputation, subject us to liability claims or regulatory penalties, harm our business relationships or increase our security and insurance costs, which could have a material adverse effect on our business, financial condition and results of operations.
For any stations that are completed but unopened, we would have substantial investments in assets that do not produce revenue, and for any stations that are open and underperforming, we may decide to close the stations. For example, we have several nearly completed stations that are not open for fueling 23 Table of Contents operations.
For any stations that are completed but unopened, we would have substantial investments in assets that do not produce revenue, and for any stations that are open and underperforming, we may decide to close the stations. We have nearly completed stations that are not open for fueling operations.
Among other things, we believe the intent of the Advanced Clean Trucks regulation, the September 2020 Executive Order, and the Advanced Clean Fleets regulation is to limit and ultimately discontinue the production and use of internal combustion engines because such engines have “tailpipe” emissions.
Among other things, we believe the intent of the ACT, the September 2020 Executive Order, and the ACF regulation is to limit and ultimately discontinue the production and use of internal combustion engines because such engines have “tailpipe” emissions.
We may be liable for any damage we or our subcontractors cause or for injuries suffered by our employees or our subcontractors’ employees during the course of work on our projects. Additionally, shortages of skilled subcontractor labor could significantly delay a project or otherwise increase our costs.
We may be liable for any damage we or our subcontractors cause or for injuries suffered by our employees or our subcontractors’ employees during the course of work on our projects. Additionally, increased and/or new tariffs on equipment supply and raw materials, and shortages of skilled subcontractor labor could significantly delay a project or otherwise increase our costs.
These significant fluctuations in our operating results may render period-to-period comparisons less meaningful, especially with respect to periods heavily impacted by effects of the COVID-19 pandemic, and investors in our securities should not rely on the results of one period as an indicator of performance in any other period.
These significant fluctuations in our operating results may render period-to-period comparisons less meaningful, such as with respect to periods heavily impacted by effects of the COVID-19 pandemic or periods impacted by non-cash asset impairment charges related to station closures, and investors in our securities should not rely on the results of one period as an indicator of performance in any other period.
Our specific focus on RNG exposes us to risks related to the supply of and demand for RNG and Environmental Credits, the cost of capital expenditures, government regulation, and economic conditions, among other factors.
Our specific focus on RNG exposes us to risks related to the supply of and demand for RNG and Environmental Credits, the cost of capital expenditures, government regulation, including increased and/or new tariffs on equipment supply and raw materials, and economic conditions, among other factors.
As of December 31, 2023, we had total consolidated indebtedness of $264.8 million, net of debt discount, and we may incur additional debt in the future.
As of December 31, 2024, we had total consolidated indebtedness of $268.1 million, net of debt discount, and we may incur additional debt in the future.
These manufacturers may decide not to expand or maintain, or may decide to discontinue or curtail, their engine or vehicle product lines for a variety of reasons, including as a result of the adoption of government policies or programs such as the Advanced Clean Trucks regulation, the September 2020 Executive Order and the Advanced Clean Fleets regulation.
These manufacturers may decide not to expand or maintain, or may decide to discontinue or curtail, their engine or vehicle product lines for a variety of reasons, including as a result of the cost of development and production as a result of increased tariffs in the U.S. or retaliatory tariffs against the U.S., or adoption or modification of government policies or programs such as the Advanced Clean Trucks regulation, the September 2020 Executive Order, the Advanced Clean Fleets regulation, and the January 2025 Executive Order (as defined below).
Many of these parties have substantially greater resources and influence than we have. Further, changes in federal, state or local political, social or economic conditions, including as a result of a lack of legislative focus on these programs and regulations or prolonged U.S. government shutdown, could result in their modification, delayed adoption or repeal.
Further, challenges to agencies’ rules and regulations and their interpretations of such rules and regulations, and changes in federal, state or local political, social or economic conditions, including as a result of a lack of legislative focus on these programs and regulations or prolonged U.S. government shutdown, could result in their modification, delayed adoption or repeal.
These include various government programs that make grant funds available from the purchase of vehicles and construction of fueling stations, as well as the AFTC under which we generate revenue for our vehicle fuel sales.
These include various government programs that make grant funds available from the purchase of vehicles and construction of fueling stations or dairy digesters, as well as the AFTC, which expired on December 31, 2024 and has not been renewed, under which we generated revenue for our vehicle fuel sales.
The prices of RNG, natural gas, crude oil, diesel, renewable diesel, and Environmental Credits can be volatile, and this volatility may continue to increase.
Increases, decreases and general volatility in oil, diesel, renewable diesel, natural gas, RNG and Environmental Credit prices could adversely affect our business. The prices of RNG, natural gas, crude oil, diesel, renewable diesel, and Environmental Credits can be volatile, and this volatility may continue to increase.
Our ability to generate revenue from our sale of RNG or our generation and sale of Environmental Credits depends on many factors, including the markets for RNG as a vehicle fuel and for Environmental Credits. The markets for Environmental Credits have been volatile and unpredictable in recent periods, and the prices for these credits are subject to fluctuations.
Our ability to generate revenue from our sale of RNG or our generation and sale of Environmental Credits depends on many factors, including the markets for RNG as a vehicle fuel and for Environmental Credits.
Any of these factors could prevent completion or operation of projects, or otherwise adversely affect our business, financial condition, and results of operations. 19 Table of Contents Acquisition, financing, construction, and development of projects by us or our partners that own projects and divestitures, investments or other strategic relationships, may not commence on anticipated timelines or at all, may not meet expectations, and may otherwise harm our business.
Acquisition, financing, construction, and development of projects by us or our partners that own projects and divestitures, investments or other strategic relationships, may not commence on anticipated timelines or at all, may not meet expectations, and may otherwise harm our business.
On December 12, 2023, we and our wholly-owned direct subsidiary Clean Energy entered into a senior secured first lien term loan agreement (the “Credit Agreement”) with the lenders from time to time party thereto (“Lenders”) and Stonepeak CLNE-L Holdings LP (“Stonepeak”), as the administrative agent and collateral agent for the Lenders and collateral agent for the secured parties, pursuant to which the Lenders funded a $300,000,000 senior secured term loan and committed to making an additional $100,000,000 of delayed draw term loans available for the two-year period after closing.
On December 12, 2023, we and our wholly-owned direct subsidiary Clean Energy entered into a senior secured first lien term loan agreement (as amended, supplemented or otherwise modified, the “Stonepeak Credit Agreement”) with the lenders from time to time party thereto, including certain affiliates of Stonepeak Partners LP (“Stonepeak Partners”), a leading alternative investment firm specializing in infrastructure and real assets, and Alter Domus Products Corp., as the administrative agent for the lenders and collateral agent for the secured parties, pursuant to which the Lenders funded a $300,000,000 senior secured term loan and committed to making an additional $100,000,000 of delayed draw term loans available for the two-year period after closing.
See the risks discussed under “ We are dependent on the production of vehicles and engines in our key customer and geographic markets by original equipment manufacturers, over which we have no control ,” above and elsewhere in these risk factors. 21 Table of Contents Increases, decreases and general volatility in oil, diesel, renewable diesel, natural gas, RNG and Environmental Credit prices could adversely affect our business.
See the risks discussed under “ We are dependent on the production of vehicles and engines in our key customer and geographic markets by original equipment manufacturers, over which we have no control ,” above and elsewhere in these risk factors.
Any permanent or temporary discontinuation or suspension of federal and state programs that provide credits, grants and incentives, such as the AFTC, would also adversely impact our revenue.
Any permanent or temporary discontinuation or suspension of federal and state programs that provide credits, grants and incentives, such as the AFTC, which expired on December 31, 2024 and has not been renewed, or the Section 45Z Production Tax Credit would also adversely impact our revenue.
All outstanding shares of our common stock are eligible for sale in the public market, subject in certain cases to the requirements of Rule 144 under the Securities Act.
Sales of our common stock, or the perception that such sales may occur, could cause the market price of our stock to drop significantly, regardless of the state of our business. All outstanding shares of our common stock are eligible for sale in the public market, subject in certain cases to the requirements of Rule 144 under the Securities Act.
Increased global cybersecurity threats and more sophisticated and targeted computer crime pose a risk to the security of our information systems and the confidentiality, availability and integrity of our data.
We rely on information technology in our operations, and any material failure, inadequacy, interruption, or security failure of that technology could harm our business. Increased global cybersecurity threats and more sophisticated and targeted computer crime pose a risk to the security of our information systems and the confidentiality, availability and integrity of our data.
Conversely, such a concentration of stock ownership may facilitate a change of control under terms other stockholders may not find favorable or at a time when other stockholders may prefer not to sell. 29 Table of Contents Sales of our common stock, or the perception that such sales may occur, could cause the market price of our stock to drop significantly, regardless of the state of our business.
Conversely, such a concentration of stock ownership may facilitate a change of control under terms other stockholders may not find favorable or at a time when other stockholders may prefer not to sell.
This extended development process requires the dedication of significant time and resources from our personnel, with no certainty of success or recovery of our expenses. Further, upon commencement of operations, it takes about 15-18 months for the project to ramp up to expected production level, receive necessary registrations and approvals from the EPA and CARB, and begin generating revenue.
Further, upon commencement of operations, it takes about 15-18 months for the project to ramp up to expected production level, receive necessary registrations and approvals from the Environmental Protection Agency (“EPA”) and CARB, and begin generating revenue.
Although we have taken steps to protect the security of our information systems and the data maintained in those systems, we have, from time to time, experienced cyberattacks or other cybersecurity incidents that have threatened our data and information systems, including malware and computer virus attacks and it is possible that future cybersecurity incidents we may experience may materially and adversely affect our business.
Despite implementing security measures, we have, from time to time, experienced cyberattacks or other cybersecurity incidents that have threatened our data and information systems. It is possible that future cybersecurity incidents could 22 Table of Contents materially and adversely affect our business.
We would be adversely affected by an increase in the rate or volume of warranty claims or the amounts involved in warranty claims, any of which could increase our costs beyond our established reserves and cause our cash position and financial condition to suffer. 26 Table of Contents Risks Related to Environmental Health and Safety and Governmental and Environmental Regulations Our business is influenced by environmental, tax and other government regulations, programs and incentives that promote our vehicle fuels, and their modification or repeal could negatively affect our business.
We would be adversely affected by an increase in the rate or volume of warranty claims or the amounts involved in warranty claims, any of which could increase our costs beyond our established reserves and cause our cash position and financial condition to suffer.
In addition, our information technology infrastructure and information systems are vulnerable to damage or interruption from natural disasters, power loss and telecommunications failures.
In addition, our information technology infrastructure and information systems are vulnerable to damage or interruption from natural disasters, power loss and telecommunications failures. The company relies on third party service providers, software as a service providers, and technologies to operate critical business systems and process sensitive information.
In addition, higher levels of indebtedness could increase our risk of non-repayment, adversely affect our creditworthiness, and amplify the other risks associated with our existing debt, which are discussed elsewhere in these risk factors. Further, we may incur substantial costs in pursuing any capital-raising transactions, including investment 25 Table of Contents banking, legal and accounting fees.
Any additional debt financing we may pursue could require us to make significant interest or other payments. In addition, higher levels of indebtedness could increase our risk of non-repayment, adversely affect our creditworthiness, and amplify the other risks associated with our existing debt, which are discussed elsewhere in these risk factors.
We expect competition to increase in the vehicle fuels market generally. In addition, if the demand for alternative vehicle fuels, including RNG, increases, then we expect competition to also increase.
We expect competition to increase in the vehicle fuels market generally. In addition, if the demand for alternative vehicle fuels, including RNG, increases, then we expect competition to also increase. Any such increased competition may reduce our customer base and revenue and may lead to increased pricing pressure, reduced operating margins and fewer expansion opportunities.
These or other similar gains or losses may not recur, in the same amounts or at all in future periods.
Our performance in certain periods has also been affected by transactions or events that have resulted in significant cash or non-cash gains or losses. These or other similar gains or losses may not recur, in the same amounts or at all in future periods.
The September 2020 Executive Order also directed CARB to develop and propose regulations and strategies aimed at achieving the foregoing goals. Resulting regulations mandate increasing adoption of zero-emission vehicles. In April 2023, CARB adopted the Advanced Clean Fleets regulation, which requires all truck fleets be zero emission by 2042.
The September 2020 Executive Order also directed CARB to develop and propose regulations and strategies aimed at achieving the foregoing goals. Resulting regulations mandate increasing adoption of zero-emission vehicles. The ACT received a federal EPA waiver from the Biden administration. It is possible that the Trump Administration may withdraw the federal EPA waiver given to California over the ACT.
The COVID-19 pandemic has and may continue to adversely affect, and a future pandemic or epidemic may adversely affect, our business, results of operations and financial condition. Our business has been and may continue to be adversely affected by the COVID-19 pandemic.
A pandemic, epidemic or other infectious disease outbreaks, such as the COVID-19 pandemic, may adversely harm our business. Our business may be adversely impacted by a future pandemic or epidemic, such as the COVID-19 pandemic.
Closure of these and/or any other stations could result in substantial additional costs and non-cash asset impairments or other charges and could cause the price of our common stock to decline. We also face many operational challenges in connection with our station design and construction activities.
Some of these stations are subject to agreements that will expire prior to us being able to open such stations and, as a result, we will incur substantial additional costs and non-cash asset impairments or other charges to remove or abandon equipment located at such stations, which could cause the price of our common stock to decline.
The Advanced Clean Fleets regulation also seeks to end the sale of combustion trucks in California in 2036.
In April 2023, CARB adopted the Advanced Clean Fleets (the “ACF”) regulation, which requires all public transit truck fleets, including municipal and other governments, be zero emission by 2042. The ACF regulation also sought to 28 Table of Contents end the sale of combustion trucks in California in 2036.
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Any such increased competition may reduce our customer base and revenue and may lead to increased pricing pressure, reduced operating margins and fewer expansion opportunities. 22 Table of Contents We rely on information technology in our operations, and any material failure, inadequacy, interruption, or security failure of that technology could harm our business.
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The agriculture industry generally, and the dairy industry in particular, are subject to risks and uncertainties that may lead to financial and other challenges impacting RNG production levels and potentially our future investments in RNG projects.
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We do not know when or if these stations will open, and some of these stations are subject to agreements that may expire prior to us being able to open such stations.
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For example, the dairy farm partner with whom we have contracted for our project in East Valley, Idaho filed for Chapter 11 bankruptcy protection in April 2024, which could have a material adverse impact on our RNG production, contractual rights, and investment for that project.
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Any debt financing we may pursue could require us to make significant interest or other payments and to pledge some or all of our assets as security.
Added
The markets for Environmental Credits have been volatile and unpredictable in recent periods, and the prices for these credits are subject to fluctuations (see “Our Principal Products, Services and Other Business Activities—Sales of Environmental Credits” in 18 Table of Contents Part I, Item 1 of this report for more information on the fluctuations in 2024).
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For example, the IRA contains credits and tax incentives that may be beneficial to us but interagency guidance processes are still ongoing.
Added
Any of these factors could prevent completion or operation of projects, or otherwise adversely affect our business, financial condition, and results of operations.
Added
This extended development process requires the dedication of significant time and resources from our personnel, with no certainty of success or recovery of our expenses.
Added
For example, due to a decline in the market price of our common stock, we determined that an indicator of potential goodwill impairment existed as of March 31, June 30, September 30, 2024, and December 31, 2024 and as such, we performed interim goodwill impairment tests during each of the quarters ended March 31, June 30, September 30, 2024 and December 31, 2024 of our single reporting unit.
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Our ability to monitor these third parties’ information security practices is limited, and they may not have adequate information security measures in place, or they may suffer unexpected downtime due to power loss, computer system or data network failures. Any security incident or other type of interruption, our information systems may become disabled or inaccessible, disrupting our operations.
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The integration of Internet of Things (“IoT”) and Artificial Intelligence (“AI”) technologies into our business operations presents both significant opportunities and inherent risks. While these technologies offer the potential to enhance efficiency, improve decision-making, and create value, they also expose the company to various operational, cybersecurity, and regulatory risks.
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The reliance on IoT and AI systems for critical business operations necessitates high levels of system reliability and performance. Any malfunction, failure, or suboptimal performance of these systems can disrupt business activities, resulting in downtime, reduced productivity, and financial losses. Inaccurate, incomplete, or corrupted data can lead to flawed decision-making, inefficiencies, and potential financial and operational risks.
Added
IoT and AI systems are vulnerable to cyber threats, including data breaches, hacking, and unauthorized access. A successful cyber-attack can compromise sensitive company information, customer data, and intellectual property, leading to financial losses, legal liabilities, and reputational damage. The use of IoT and AI technologies involves collecting and processing large volumes of personal and proprietary data.
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Any mishandling or unauthorized access to this data can result in privacy breaches, regulatory penalties, and loss of customer trust. The regulatory landscape for IoT and AI technologies is evolving rapidly. The company must ensure compliance with existing and emerging regulations related to data protection, privacy, and cybersecurity.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe are not aware of any risks from cybersecurity threats, including as a result of any cybersecurity incidents, which have materially affected or are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition. Refer to “Item 1A.
Biggest changeThese crisis incident management teams report on an as needed basis to the Audit Committee and full Board of Directors to keep them informed and seek direction where necessary. 31 Table of Contents We are not aware of any risks from cybersecurity threats, including as a result of any cybersecurity incidents, which have materially affected or are reasonably likely to materially affect our company, including our business strategy, results of operations, or financial condition.
Risk Factors” in this annual report on Form 10-K, including “ We rely on information technology in our operations, and any material failure, inadequacy, interruption, or security failure of that technology could harm our business ,” for additional discussion about cybersecurity-related risks.
Refer to “Item 1A. Risk Factors” in this annual report on Form 10-K, including “ We rely on information technology in our operations, and any material failure, inadequacy, interruption, or security failure of that technology could harm our business ,” for additional discussion about cybersecurity-related risks.
These updates include, among other risk management issues, updates on the Company’s cybersecurity risks and threats, 30 Table of Contents the status of projects to strengthen our information security systems, assessments of the information security program, and the emerging threat landscape.
Our Group Vice President and IT Director provide periodic updates to our Board of Directors, Audit Committee, and other senior management members. These updates include, among other risk management issues, updates on the Company’s cybersecurity risks and threats, the status of projects to strengthen our information security systems, assessments of the information security program, and the emerging threat landscape.
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Our Group Vice President and IT Director provide periodic updates to our Board of Directors, Audit Committee, and other senior management members.
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These crisis incident management teams report on an as needed basis to the Audit Committee and full Board of Directors to keep them informed and seek direction where necessary.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe Pickens Plant can produce 28.0 million gallons of LNG per year and includes a tanker trailer loading system and a 1.0 million gallon storage tank that can hold up to 840,000 usable gallons. The plant had a production utilization rate of 62% for the year ended December 31, 2022.
Biggest changeThe Pickens Plant can produce 36.5 million gallons of LNG per year and includes a tanker trailer loading system and a 830,000 gallon storage tank that can hold up to 830,000 usable gallons.
In November 2006, we entered into a 30-year ground lease for the 36 acres on which this plant is situated. The Boron Plant can produce 56.0 million gallons of LNG per year and has a dual tanker trailer loading system and a 1.8 million gallon storage tank that can hold up to 1.5 million usable gallons.
In November 2006, we entered into a 30-year ground lease for the 36 acres on which this plant is situated. The Boron Plant can produce 98.5 million gallons of LNG per year and has a dual tanker trailer loading system and a 1.8 million gallon storage tank that can hold up to 1.5 million usable gallons.
Fueling stations are facilities where RNG or conventional natural gas is dispensed in the form of CNG or LNG into the fuel tanks of vehicles for use as transportation fuel. We own station equipment throughout the U.S. (See Note 10) that is used for dispensing CNG or LNG at properties we lease under long-term lease arrangements (See Note 16).
Fueling stations are facilities where RNG or conventional natural gas is dispensed in the form of CNG or LNG into the fuel tanks of vehicles for use as transportation fuel. We own station equipment throughout the U.S. (See Note 9) that is used for dispensing CNG or LNG at properties we lease under long-term lease arrangements (See Note 15).
The plant had a production utilization rate of 79% and 78% for the years ended December 31, 2022 and 2023, respectively. We own and operate the Pickens Plant located in Willis, Texas, approximately 50 miles north of Houston. We own approximately 24 acres of land on which this plant is situated, along with approximately 34 acres surrounding the plant.
The plant had a production utilization rate of 78% and 94% for the years ended December 31, 2023 and 2024, respectively. We own and operate the Pickens Plant located in Willis, Texas, approximately 50 miles north of Houston. We own approximately 24 acres of land on which this plant is situated, along with approximately 34 acres surrounding the plant.
During the year ended December 31, 2023, the Pickens Plant was offline for maintenance and repairs; hence, the plant had no LNG production in 2023. We own, operate or supply 579 fueling stations in the U.S. and 24 in Canada.
During the years ended December 31, 2023 and 2024, the Pickens Plant was offline for maintenance and repairs; hence, the plant had no LNG production in 2023 and 2024. We own, operate or supply 582 fueling stations in the U.S. and 25 in Canada.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn the opinion of management, however, we are not a party, and our properties are not subject, to any pending legal proceedings that are material to us. Item 4. Mine Safety Disclosures. None. PART II
Biggest changeIn the opinion of management, however, we are not a party, and our properties are not subject, to any pending legal proceedings that are material to us. Item 4. Mine Safety Disclosures. None. ​ 32 Table of Contents PART II
It is not possible to predict when or if these proceedings may arise, nor is it possible to predict the outcome of any proceedings that do arise, including, among other things, the amount or timing of any liabilities we may incur, and any such proceedings could have 31 Table of Contents a material effect on us regardless of outcome.
It is not possible to predict when or if these proceedings may arise, nor is it possible to predict the outcome of any proceedings that do arise, including, among other things, the amount or timing of any liabilities we may incur, and any such proceedings could have a material effect on us regardless of outcome.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeWe chose to include the Russell 2000 Index because it includes issuers with similar market capitalizations and due to the lack of a comparable industry or line-of-business index or peer group, 33 Table of Contents as we are the only actively traded public company whose only line of business is to sell natural gas for use as a vehicle fuel and the associated equipment and services necessary to use natural gas as a vehicle fuel.
Biggest changeWe chose to include the Russell 2000 Index because it includes issuers with similar market capitalizations and due to the lack of a comparable industry or line-of-business index or peer group, as we are the only actively traded public company whose only line of business is to sell natural gas for use as a vehicle fuel and the associated equipment and services necessary to use natural gas as a vehicle fuel.
The graph assumes that $100 was invested in our common stock and in each of these indices at the close of market on December 31, 2018 (the last trading day before the beginning of our fifth preceding fiscal year).
The graph assumes that $100 was invested in our common stock and in each of these indices at the close of market on December 31, 2019 (the last trading day before the beginning of our fifth preceding fiscal year).
The graph is required by applicable rules of the SEC and is not intended to forecast, predict or be indicative of the possible future performance of our common stock. The following graph compares the five-year total return to holders of our common stock relative to the cumulative total returns of the Nasdaq Global Market Index and the Russell 2000 Index.
The graph is required by applicable rules of the SEC and is not intended to forecast, predict or be indicative of the possible future performance of our common stock. 33 Table of Contents The following graph compares the five-year total return to holders of our common stock relative to the cumulative total returns of the Nasdaq Global Market Index and the Russell 2000 Index.
As of December 31, 2023, approximately $26.5 million remained available under the Repurchase Program. The Repurchase Program does not obligate us to acquire any specific number of shares.
As of December 31, 2024, approximately $26.5 million remained available under the Repurchase Program. The Repurchase Program does not obligate us to acquire any specific number of shares.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on The Nasdaq Global Select Market under the symbol “CLNE.” Holders There were approximately 52 holders of record of our common stock as of February 22, 2024.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Market Information Our common stock trades on The Nasdaq Global Select Market under the symbol “CLNE.” Holders There were approximately 53 holders of record of our common stock as of February 14, 2025.
Removed
Repurchases may also be made under plans set up pursuant to Rule 10b5-1 promulgated under the Exchange Act. 32 Table of Contents The following table summarizes the Company’s share repurchase activities during the three months ended December 31, 2023 (in thousands, except share and per share amounts): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Maximum Number ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (or Approximate ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dollar Value) ​ ​ ​ ​ ​ ​ ​ ​ Total Number of ​ of Shares That ​ ​ ​ ​ ​ ​ ​ Shares Purchased ​ May Yet Be ​ ​ Total Number ​ Average ​ as Part of Publicly ​ Purchased ​ ​ of Shares ​ Price Paid ​ Announced Plans ​ Under the Plans Period Purchased per Share (a) or Programs or Program October 1, 2023 through October 31, 2023 ​ ​ — ​ $ — ​ ​ — ​ $ 26,502 November 1, 2023 through November 30, 2023 ​ — ​ ​ — ​ ​ — ​ ​ 26,502 December 1, 2023 through December 31, 2023 ​ — ​ ​ — ​ ​ — ​ ​ 26,502 Total ​ ​ — ​ $ — ​ ​ — ​ $ 26,502 ​ (a) Exclusive of fees and commissions.
Added
Repurchases may also be made under plans set up pursuant to Rule 10b5-1 promulgated under the Exchange Act. The Company did not repurchase any shares in the years ended December 31, 2023 and 2024.
Added
Any share repurchases under the Repurchase Program will require consent from the Company’s creditor, Stonepeak Partners LP, to remain in compliance with covenants under the Credit Agreement.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

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Biggest changeItem 6. ​ [ Reserved] 34 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations 34 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk 51 Item 8. ​ Financial Statements and Supplementary Data 52
Biggest changeItem 6. ​ [ Reserved] 34 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations 34 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk 52 Item 8. ​ Financial Statements and Supplementary Data 53

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe decrease was primarily due to (1) a $36.3 million increase in non-cash stock-based sales incentive contra-revenue charges relating to the Amazon Warrant driven by higher customer fuel purchases, (2) a decrease in RIN revenue of $8.8 million primarily resulting from lower average RIN prices and lower share of RIN values in 2023 when compared to those in 2022, (3) a decrease in AFTC revenue of $0.9 million due to increased AFTC revenue sharing with customers, (4) a decrease in LCFS revenue of $2.7 million primarily resulting from lower average LCFS prices in 2023 when compared to those in 2022 and increased LCFS revenue sharing with customers, and (5) a change in fair value of our commodity swap and customer contracts entered into in connection with our Zero Now truck financing program, as we recognized an unrealized loss of $0.2 million in 2023 compared to an unrealized gain of $0.5 million in 2022.
Biggest changeThe decrease in product revenue between periods was partially offset by (1) an increase in RIN revenue of $13.1 million primarily resulting from higher average RIN prices and higher share of RIN values in 2024 when compared to those in 2023, (2) an increase in AFTC revenue of $2.9 million due to higher fuel volumes in 2024 compared to 2023, (3) an increase in LCFS revenue of $0.1 million primarily resulting from increased LCFS revenue sharing with customers in 2024 when compared to those in 2023, partially offset by lower average LCFS prices, and (4) a change in fair value of our commodity swap and customer contracts entered into in connection with our Zero Now truck financing program, as we recognized an unrealized loss of $0.1 million in 2024 compared to an unrealized loss of $0.2 million in 2023.
(the “DR JV”) (see Note 4)) and conventional natural gas (sourced from third party suppliers), in the form of CNG and LNG, for medium and heavy-duty vehicles; design and build, as well as operate and maintain (“O&M”), public and private vehicle fueling stations in the United States (“U.S.”) and Canada; develop and own dairy anaerobic digester gas (“ADG”) RNG production facilities; sell and service compressors and other equipment used in RNG production and at fueling stations; transport and sell RNG and conventional natural gas via “virtual” natural gas pipelines and interconnects; sell U.S. federal, state and local government credits (collectively, “Environmental Credits”) we generate by selling RNG as a vehicle fuel, including Renewable Identification Numbers (“RIN Credits” or “RINs”) under the federal Renewable Fuel Standard Phase 2 and credits under the California, Oregon, and Washington Low Carbon Fuel Standards (collectively, “LCFS Credits”); and obtain federal, state and local tax credits, grants and incentives.
(the “DR JV”) (see Note 3)) and conventional natural gas (sourced from third party suppliers), in the form of CNG and LNG, for medium and heavy-duty vehicles; design and build, as well as operate and maintain (“O&M”), public and private vehicle fueling stations in the United States (“U.S.”) and Canada; develop and own dairy anaerobic digester gas (“ADG”) RNG production facilities; sell and service compressors and other equipment used in RNG production and at fueling stations; transport and sell RNG and conventional natural gas via “virtual” natural gas pipelines and interconnects; sell U.S. federal, state and local government credits (collectively, “Environmental Credits”) we generate by selling RNG as a vehicle fuel, including Renewable Identification Numbers (“RIN Credits” or “RINs”) under the federal Renewable Fuel Standard Phase 2 and credits under the California, Oregon, and Washington Low Carbon Fuel Standards (collectively, “LCFS Credits”); and obtain federal, state and local tax credits, grants and incentives.
From December 2022 to February 2023, the wholesale prices of natural gas in California spiked to historic levels. The January 2023 monthly index for Southern California settled at $54.31, and Henry Hub settled at $4.71, or 11.5 times higher than the industry benchmark index.
Winter 2022–2023 California Natural Gas Prices . From December 2022 to February 2023, the wholesale prices of natural gas in California spiked to historic levels. The January 2023 monthly index for Southern California settled at $54.31, and Henry Hub settled at $4.71, or 11.5 times higher than the industry benchmark index.
More information about our GGEs serviced in the periods relating to O&M services is included below under “Key Operating Data.” Additionally, a discussion of service revenue is included below under “Results of Operations.” 36 Table of Contents Key Operating Data In evaluating our operating performance, we focus primarily on: (1) the amount of total fuel volume we sell to our customers with particular focus on RNG volume as a subset of total fuel volume, (2) O&M services volume dispensed at facilities we do not own but where we provide O&M services on a per-gallon or fixed fee basis, (3) our station construction cost of sales, and (4) net income (loss) attributable to us.
More information about our GGEs serviced in the periods relating to O&M services is included below under “Key Operating Data.” Additionally, a discussion of service revenue is included below under “Results of Operations.” Key Operating Data In evaluating our operating performance, we focus primarily on: (1) the amount of total fuel volume we sell to our customers with particular focus on RNG volume as a subset of total fuel volume, (2) O&M services volume dispensed at facilities we do not own but where we provide O&M services on a per-gallon or fixed fee basis, (3) our station construction cost of sales, and (4) net income (loss) attributable to us.
We estimate that the natural gas price spike in California from December 2022 to February 2023 resulted in a reduction in gross profit of approximately $10.0 million for the three months ended March 31, 2023. Since then, we have seen wholesale prices of natural gas in California largely revert to normal levels. South Fork Dairy Farm Incident .
We estimate that the natural gas price spike in California from December 2022 to February 2023 resulted in a reduction in gross profit of approximately $10.0 million for the three months ended March 31, 2023. Since then, we have seen wholesale prices of natural gas in California largely revert to normal levels. South Fork Dairy Farm Project .
If these adverse macroeconomic conditions and other uncertainties in our industry persist, our financial results and stock price may continue to be adversely affected. 40 Table of Contents In spite of these market conditions, we believe our key customer markets, including heavy-duty trucking, airports, refuse, and public transit, are well-suited for the adoption of our vehicle fuels because they consume relatively high volumes of fuel, refuel at centralized locations or along well-defined routes and/or are facing increasingly stringent emissions or other environmental requirements.
If these adverse macroeconomic conditions and other uncertainties in our industry persist, our financial results and stock price may continue to be adversely affected. ​ In spite of these market conditions, we believe our key customer markets, including heavy-duty trucking, airports, refuse, and public transit, are well-suited for the adoption of our vehicle fuels because they consume relatively high volumes of fuel, refuel at centralized locations or along well-defined routes and/or are facing increasingly stringent emissions or other environmental requirements.
Among other things, we believe many California lawmakers and regulators’ desire to limit and ultimately discontinue the production and use of internal combustion engine is because such engines have “tailpipe” emissions. ● We believe the lack of substantial growth in the heavy-duty trucking market has been driven in part by the experience of operators with, or perceptions of, unsatisfactory performance by prior models of heavy-duty natural gas truck engines, actual or perceived insufficiencies in the financial incentives to convert, and improvements in diesel engine technology.
Among other things, we believe many California lawmakers and regulators’ desire to limit and ultimately discontinue the production and use of internal combustion engines is because such engines have “tailpipe” emissions. 40 Table of Contents ● We believe the lack of substantial growth in the heavy-duty trucking market has been driven in part by the experience of operators with, or perceptions of, unsatisfactory performance by prior models of heavy-duty natural gas truck engines, actual or perceived insufficiencies in the financial incentives to convert, and improvements in diesel engine technology.
We believe the increased demand for RNG is attributable to the belief in the dramatic reduction in the amount of climate-harming greenhouse gas that can be achieved through the use of RNG and pressure from politicians, regulators, non-governmental organizations and the investment community directed at companies to reduce their contributions to GHG emissions.
We believe the increased demand for RNG is attributable to the belief in the dramatic reduction in the amount of climate-harming GHG that can be achieved through the use of RNG and pressure from politicians, regulators, non-governmental organizations and the investment community directed at companies to reduce their contributions to GHG emissions.
Through our sales of RNG, which is derived from biogenic methane produced by the breakdown of organic waste, we help thousands of vehicles, from airport shuttles to city buses to waste and heavy-duty trucks, reduce their amount of climate-harming greenhouse gases (“GHG”) from 60% to over 400% based on determinations by the California Air Resources Board (“CARB”), depending on the source of the RNG, while also 34 Table of Contents reducing criteria pollutants such as Nitrogen Oxides, or NOx.
Through our sales of RNG, which is derived from biogenic methane produced by the breakdown of organic waste, we help thousands of vehicles, from airport shuttles to city buses to waste and heavy-duty trucks, reduce their amount of climate-harming greenhouse gases (“GHG”) from 60% to over 400% based on determinations by the California Air Resources Board (“CARB”), depending on the source of the RNG, while also reducing criteria pollutants such as Nitrogen Oxides, or NOx.
As of December 31, 2023, we served over 1,000 fleet customers operating over 50,000 vehicles on our fuels. Longer term, we plan to expand availability of hydrogen fuel for vehicle fleets. As operators deploy more hydrogen powered vehicles, we can modify our fueling stations to reform our RNG and deliver clean hydrogen to customers.
As of December 31, 2024, we served over 1,000 fleet customers operating over 50,000 vehicles on our fuels. Longer term, we plan to expand availability of hydrogen fuel for vehicle fleets. As operators deploy more hydrogen powered vehicles, we can modify our fueling stations to reform our RNG and deliver clean hydrogen to customers.
Our volume-related product revenue consists of sales of RNG and conventional natural gas, in the form of CNG and LNG, AFTC incentives, and sales of RINs and LCFS Credits in addition to Amazon Warrant Charges (as defined in Note 13) and changes in fair value of our derivative instruments.
Our volume-related product revenue consists of sales of RNG and conventional natural gas, in the form of CNG and LNG, AFTC incentives, and sales of RINs and LCFS Credits in addition to Amazon Warrant Charges (as defined in Note 12) and changes in fair value of our derivative instruments.
In addition, such an increase in RNG demand could also result in more robust competition for supplies of RNG, including from other vehicle fuel providers, gas utilities (which may have distinct advantages in 41 Table of Contents accessing RNG supply, including potential use of ratepayer funds to fund RNG purchases if approved by a utility’s regulatory commission) and other users and providers.
In addition, such an increase in RNG demand could also result in more robust competition for supplies of RNG, including from other vehicle fuel providers, gas utilities (which may have distinct advantages in accessing RNG supply, including potential use of ratepayer funds to fund RNG purchases if approved by a utility’s regulatory commission) and other users and providers.
More information about our GGEs of fuel sold in the periods is included below under “Key Operating Data,” and more information about our derivative instruments, which consist of commodity swap and customer fueling contracts, is included in Note 7.
More information about our GGEs of fuel sold in the periods is included below under “Key Operating Data,” and more information about our derivative instruments, which consist of commodity swap and customer fueling contracts, is included in Note 6.
On December 20, 2023, the bpJV issued a capital call in the amount of $135.9 million, and, on December 28, 2023, we and bp each contributed 37 Table of Contents $67.95 million to the bpJV. Proceeds from these capital calls are used to develop ADG RNG projects and to fund bpJV’s working capital needs. Tourmaline Joint Development .
On December 20, 2023, the bpJV issued a capital call in the amount of $135.9 million, and, on December 28, 2023, we and bp each contributed $67.95 million to the bpJV. Proceeds from these capital calls are used to develop ADG RNG projects and to fund bpJV’s working capital needs. Tourmaline Joint Development .
When we sell RNG and conventional natural gas for use as a vehicle fuel, we are eligible to generate RINs and LCFS Credits, which we then seek to sell to third parties. The markets for RINs and LCFS Credits have been volatile and unpredictable in recent periods, and the prices for these credits have been subject to significant fluctuations.
When we sell RNG for use as a vehicle fuel, we are eligible to generate RINs and LCFS Credits, which we then seek to sell to third parties. ​ The markets for RINs and LCFS Credits have been volatile and unpredictable in recent periods, and the prices for these credits have been subject to significant fluctuations.
To the extent demand for RNG continues to increase, we expect our joint venture(s) with TotalEnergies and bp and our expanded supply agreements to increase our volume-related product revenue due to increased volumes of RNG vehicle fuel sold and increased generation of RINs and LCFS Credits.
To the extent demand for RNG continues to increase, we expect our joint ventures with TotalEnergies and bp and our expanded supply agreements to increase our volume-related product revenue due to increased volumes of RNG vehicle fuel sold and increased generation of RINs and LCFS Credits.
Discussions of 2021 items and year-to-year comparisons of 2022 and 2021 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC on February 28, 2023.
Discussions of 2022 items and year-to-year comparisons of 2023 and 2022 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC on February 29, 2024.
On April 18, 2023, we and Tourmaline Oil Corp. (“Tourmaline”) announced a CAD $70 million Joint Development Agreement to build and operate a network of CNG stations along key highway corridors across Western Canada.
On April 18, 2023, we and Tourmaline Oil Corp. (“Tourmaline”) announced a CAD $70 million Joint Development Agreement (the “Tourmaline JDA”) to build and operate a network of CNG stations along key highway corridors across Western Canada.
In 2023 and 2022, we recorded a gain of $0.6 million and $0.9 million, respectively, for the noncontrolling interest in the net loss of NG Advantage. The noncontrolling interest in NG Advantage represents a 6.7% minority interest that was held by third parties during both the 2023 and 2022 periods.
In 2024 and 2023, we recorded a gain of $0.6 million and $0.6 million, respectively, for the noncontrolling interest in the net loss of NG Advantage. The noncontrolling interest in NG Advantage represents a 6.7% minority interest that was held by third parties during both the 2024 and 2023 periods.
Based on our outstanding indebtedness and applicable interest rates as of December 31, 2023, we expect our total interest payment obligations relating to our indebtedness to be approximately $29.2 million for the year ending December 31, 2024. We plan to and believe we are able to make all expected principal and interest payments in the next 12 months.
Based on our outstanding indebtedness and applicable interest rates as of December 31, 2024, we expect our total interest payment obligations relating to our indebtedness to be approximately $29.1 million for the year ending December 31, 2025. We plan to and believe we are able to make all expected principal and interest payments in the next 12 months.
The amount presented is net of amounts funded through December 31, 2023 and excludes contractual commitments relating to station sales contracts. (6) Represents our capital expenditure commitment to fund the development and construction of ADG RNG projects, net of amounts funded through December 31, 2023. The project is expected to be substantially complete in the second quarter of 2025.
The amount presented is net of amounts funded through December 31, 2024 and excludes contractual commitments relating to station sales contracts. (6) Represents our capital expenditure commitment to fund the development and construction of ADG RNG projects, net of amounts funded through December 31, 2024. The project is expected to be substantially complete in the third quarter of 2025.
We expect cash provided by our operating activities to fluctuate depending on our operating results, which can be affected by the factors described above, as well as the other factors described in this MD&A and Item 1A. “Risk Factors” of this report.
We expect cash provided by our operating activities to fluctuate depending on our operating results, which can be affected by the factors described above, such as the non-renewal of AFTC, as well as the other factors described in this MD&A and Item 1A. “Risk Factors” of this report.
Historical results are not indicative of the results to be expected in the current period or any future period. 45 Table of Contents 2023 Compared to 2022 The table below presents, for each period, each line item of our statement of operations as a percentage of our total revenue for the period.
Historical results are not indicative of the results to be expected in the current period or any future period. 46 Table of Contents 2024 Compared to 2023 The table below presents, for each period, each line item of our statement of operations as a percentage of our total revenue for the period.
The primary method used to estimate the standalone selling price for fuel and O&M services is observable standalone sales, and the primary method used to estimate the standalone selling price for station construction sales is the expected cost plus a margin approach because we sell customized customer-specific solutions.
The primary method used to estimate the standalone selling price for fuel and O&M services is observable standalone sales, and the primary method used to estimate the standalone selling price for station construction sales is the expected cost plus a margin approach because we sell customized customer-specific 44 Table of Contents solutions.
Subject to the following paragraph, we believe our cash and cash equivalents and short-term investments and anticipated cash provided by our operating and financing activities will satisfy our business requirements for at least the 12 months following the date of this report.
Subject to the following paragraph, we believe our cash and cash equivalents and short-term investments and anticipated cash provided by our operating and current or future financing activities will satisfy our expected business requirements for at least the 12 months following the date of this report.
For more information, see “Risk Factors” in Part I, Item 1A of this report. As of December 31, 2023, the majority of our debt outstanding represents a long-term loan bearing a fixed rate of interest. Changes in market interest rates do not affect the interest expense incurred from this outstanding long-term debt 35 Table of Contents instrument.
For more information, see “Risk Factors” in Part I, Item 1A of this report. As of December 31, 2024, the majority of our debt outstanding represents a long-term loan bearing a fixed rate of interest. Changes in market interest rates do not affect the interest expense incurred from this outstanding long-term debt instrument.
The following tables present our key operating data for the years ended December 31, 2021, 2022 and 2023.
The following tables present our key operating data for the years ended December 31, 2022, 2023 and 2024.
See Note 1 for additional information. Station construction contracts are generally short-term, except for certain larger and more complex stations, which can take up to 24 months to complete. For most of our station construction contracts, the customer contracts with us to provide a significant service of integrating a complex set of tasks and components into a single station.
Station construction contracts are generally short-term, except for certain larger and more complex stations, which can take up to 24 months to complete. For most of our station construction contracts, the customer contracts with us to provide a significant service of integrating a complex set of tasks and components into a single station.
As of December 31, 2023, excluding current portion of restricted cash, we had total cash and cash equivalents and short-term investments of $263.1 million, compared to $263.5 million as of December 31, 2022.
As of December 31, 2024, excluding current portion of restricted cash, we had total cash and cash equivalents and short-term investments of $217.5 million, compared to $263.1 million as of December 31, 2023.
In addition, our volume-related product revenue has been and may continue to be subject to fluctuations as a result of our entry into certain commodity swap arrangements in October 2018, because the changes in fair value of these and certain other derivative instruments, including existing and anticipated fueling contracts under our Zero Now truck financing program, are included in volume-related product revenue.
In addition, our volume-related product revenue has been subject to fluctuations as a result of our entry into certain commodity swap arrangements in October 2018 and ended in June 2024, because the changes in fair value of these and certain other derivative instruments, including existing and anticipated fueling contracts under our Zero Now truck financing program, are included in volume-related product revenue.
This section of the Form 10-K generally discusses 2023 and 2022 items and year-to-year comparisons of 2023 to 2022.
This section of the Form 10-K generally discusses 2024 and 2023 items and year-to-year comparisons of 2024 to 2023.
We expect cash provided by our operating activities to fluctuate as a result of a number of factors, including our operating results and the factors that affect these results, including the amount and timing of our vehicle fuel sales, station construction sales, sales of RINs and LCFS Credits and recognition of government credits, grants and incentives, if any; fluctuations in commodity, station construction and labor costs; environmental credit prices; variations in the fair value of certain of our derivative instruments that are recorded in revenue; and the amount and timing of our billing, collections and liability payments.
We expect cash provided by our operating activities to fluctuate as a result of a number of factors, including our operating results and the factors that affect these results, including the amount and timing of our vehicle fuel sales, station construction sales, sales of RINs and LCFS Credits and recognition of government credits, grants and incentives, if any; fluctuations in commodity, station construction and labor costs; supply chain issues and unfavorable macroeconomic events, including inflationary pressures; environmental credit prices; variations in the fair value of certain of our derivative instruments that are recorded in revenue; and the amount and timing of our billing, collections and liability payments.
Off-Balance Sheet Arrangements As of December 31, 2023, we had the following off-balance sheet arrangements that have had, or are reasonably likely to have, a material current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources: ● Outstanding surety bonds for construction contracts and general corporate purposes totaling $50.4 million; ● Quarterly fixed-price natural gas purchase contracts with take-or-pay commitments, the amount of which is shown under “Contractual Obligations” above; ● One long-term natural gas sale contract with a fixed supply commitment.
Off-Balance Sheet Arrangements As of December 31, 2024, we had the following off-balance sheet arrangements that have had, or are reasonably likely to have, a material current or future effect on our financial condition, changes in financial condition, revenue or expenses, results of operations, liquidity, capital expenditures or capital resources: ● Outstanding surety bonds for construction contracts and general corporate purposes totaling $93.8 million; ● A loan commitment to an equity method investee; ● Quarterly fixed-price natural gas purchase contracts with take-or-pay commitments, the amount of which is shown under “Contractual Obligations” above; ● One long-term natural gas sale contract with a fixed supply commitment.
Certain gallons are included in both fuel and service volumes when the Company sells fuel (product revenue) to a customer and provides maintenance services (service revenue) to the same customer. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fuel volume, GGEs (2) sold (in millions), ​ Year Ended December 31, correlating to total volume-related product revenue 2021 2022 2023 RNG (1) ​ 167.0 ​ ​ 198.2 ​ ​ 225.7 Conventional natural gas (1) ​ 78.8 ​ ​ 69.6 ​ ​ 62.5 Total fuel volume ​ 245.8 ​ 267.8 ​ 288.2 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ O&M services volume, GGEs (2) serviced (in millions), ​ Year Ended December 31, correlating to volume-related O&M services revenue 2021 2022 2023 O&M services volume ​ 229.8 ​ ​ 240.4 ​ ​ 256.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, Other operating data (in millions) 2021 2022 2023 Station construction cost of sales ​ $ 15.0 ​ $ 19.4 ​ $ 24.4 Net loss attributable to Clean Energy Fuels Corp.
Certain gallons are included in both fuel and service volumes when the Company sells fuel (product revenue) to a customer and provides maintenance services (service revenue) to the same customer. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended Fuel volume, GGEs (1) sold (in millions), ​ December 31, correlating to total volume-related product revenue 2022 2023 2024 RNG ​ 198.2 ​ ​ 225.7 ​ ​ 236.7 Conventional natural gas ​ 69.6 ​ ​ 62.5 ​ ​ 60.8 Total fuel volume ​ 267.8 ​ 288.2 ​ 297.5 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended O&M services volume, GGEs (1) serviced (in millions), ​ December 31, correlating to volume-related O&M services revenue 2022 2023 2024 O&M services volume ​ 240.4 ​ ​ 256.9 ​ ​ 263.2 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, Other operating data (in millions) 2022 2023 2024 Station construction cost of sales ​ $ 19.4 ​ $ 24.4 ​ $ 24.4 Net loss attributable to Clean Energy Fuels Corp.
(5) Includes an unrealized gain (loss) from the change in fair value of commodity swap and customer fueling contracts of $(3.5) million, $0.5 million and $(0.2) million for the years ended December 31, 2021, 2022 and 2023, respectively. See Note 7 for more information regarding the commodity swap and customer contracts. 2022 – 2023 Key Developments TotalEnergies Joint Venture.
(4) Includes an unrealized gain (loss) from the change in fair value of commodity swap and customer fueling contracts of $0.5 million, $(0.2) million and $(0.1) million for the years ended December 31, 2022, 2023 and 2024, respectively. See Note 6 for more information regarding the commodity swap and customer contracts. 2023 – 2024 Key Developments TotalEnergies Joint Venture.
The narrative that follows provides a comparative discussion of certain of these line items between periods. ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2022 2023 Statements of Operations Data: ​ Revenue: ​ Product revenue 88.8 % 87.0 % Service revenue 11.2 13.0 ​ Total revenue 100.0 100.0 ​ Operating expenses: ​ Cost of sales (exclusive of depreciation and amortization shown separately below): ​ Product cost of sales 66.6 72.9 ​ Service cost of sales 6.7 7.9 ​ Selling, general and administrative 26.1 26.4 ​ Depreciation and amortization 13.0 10.7 ​ Total operating expenses 112.4 117.9 ​ Operating loss (12.3) (18.0) ​ Interest expense (1.5) (5.4) ​ Interest income 0.8 2.6 ​ Other income, net — — ​ Loss from equity method investments (1.1) (2.9) ​ Loss before income taxes (14.1) (23.7) ​ Income tax (expense) benefit (0.1) 0.1 ​ Net loss (14.2) (23.6) ​ Loss attributable to noncontrolling interest 0.2 0.1 ​ Net loss attributable to Clean Energy Fuels Corp.
The narrative that follows provides a comparative discussion of certain of these line items between periods. ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ ​ December 31, ​ ​ 2023 2024 Statements of Operations Data: ​ Revenue: ​ Product revenue 87.0 % 85.8 % Service revenue 13.0 14.2 ​ Total revenue 100.0 100.0 ​ Operating expenses: ​ Cost of sales (exclusive of depreciation and amortization shown separately below): ​ Product cost of sales 72.9 60.0 ​ Service cost of sales 7.9 9.1 ​ Selling, general and administrative 26.4 26.9 ​ Depreciation and amortization 10.7 10.8 ​ Impairment of Investments in Equity Securities — 1.9 ​ Total operating expenses 117.9 108.7 ​ Operating loss (18.0) (8.7) ​ Interest expense (5.4) (7.7) ​ Interest income 2.6 3.4 ​ Other income (expense), net — — ​ Loss from equity method investments (2.9) (6.4) ​ Loss before income taxes (23.7) (19.4) ​ Income tax (expense) benefit 0.1 (0.6) ​ Net loss (23.6) (20.0) ​ Loss attributable to noncontrolling interest 0.1 0.1 ​ Net loss attributable to Clean Energy Fuels Corp.
As of December 31, 2023, we deliver RNG to the transportation market through 579 fueling stations we own, operate or supply in 43 states and the District of Columbia in the U.S., including over 200 stations in California. We also own, operate, or supply 24 fueling stations in Canada as of December 31, 2023.
As of December 31, 2024, we deliver RNG to the transportation market through 582 fueling stations we own, operate or supply in 43 states and the District of Columbia in the U.S., including over 200 stations in California. We also own, operate, or supply 25 fueling stations in Canada as of December 31, 2024.
Sources of Revenue The following table presents our sources of revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, Revenue (in millions) ​ 2021 2022 2023 Product revenue (1) : ​ ​ ​ ​ ​ ​ ​ ​ ​ Volume-related (2) ​ ​ ​ ​ ​ ​ ​ ​ ​ Fuel sales (3) ​ $ 131.0 ​ $ 281.1 ​ $ 287.0 Change in fair value of derivative instruments (4) ​ ​ (3.5) ​ ​ 0.5 ​ ​ (0.2) RIN Credits ​ ​ 31.7 ​ ​ 34.7 ​ ​ 25.9 LCFS Credits ​ ​ 16.8 ​ ​ 12.6 ​ ​ 9.9 AFTC (5) ​ 20.7 ​ 21.8 ​ 20.9 Total volume-related product revenue ​ ​ 196.7 ​ ​ 350.7 ​ ​ 343.5 Station construction sales ​ ​ 16.4 ​ ​ 22.3 ​ ​ 26.4 Total product revenue ​ 213.1 ​ 373.0 ​ 369.9 Service revenue (6) : ​ ​ ​ ​ ​ ​ ​ ​ ​ Volume-related, O&M services ​ ​ 41.9 ​ ​ 45.9 ​ ​ 52.7 Other services ​ ​ 0.6 ​ ​ 1.3 ​ ​ 2.6 Total service revenue ​ 42.5 ​ 47.2 ​ 55.3 Total revenue ​ $ 255.6 ​ $ 420.2 ​ $ 425.2 (1) A discussion of product revenue is included below under “Results of Operations.” (2) Our volume-related product revenue primarily consists of sales of RNG and conventional natural gas, in the form of CNG and LNG, and sales of RINs and LCFS Credits in addition to changes in fair value of our derivative instruments.
Sources of Revenue The following table presents our sources of revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Revenue (in millions) ​ 2022 2023 2024 Product revenue (1) : ​ ​ ​ ​ ​ ​ ​ ​ ​ Volume-related (2) ​ ​ ​ ​ ​ ​ ​ ​ ​ Fuel sales (3) (5) ​ $ 281.1 ​ $ 287.0 ​ $ 258.9 Change in fair value of derivative instruments (4) ​ ​ 0.5 ​ ​ (0.2) ​ ​ (0.1) RIN Credits ​ ​ 34.7 ​ ​ 25.9 ​ ​ 39.0 LCFS Credits ​ ​ 12.6 ​ ​ 9.9 ​ ​ 9.9 AFTC (6) ​ 21.8 ​ 20.9 ​ 23.8 Total volume-related product revenue ​ ​ 350.7 ​ ​ 343.5 ​ ​ 331.5 Station construction sales ​ ​ 22.3 ​ ​ 26.4 ​ ​ 25.2 Total product revenue ​ 373.0 ​ 369.9 ​ 356.7 Service revenue (7) : ​ ​ ​ ​ ​ ​ ​ ​ ​ Volume-related, O&M services ​ ​ 45.9 ​ ​ 52.7 ​ ​ 56.9 Other services ​ ​ 1.3 ​ ​ 2.6 ​ ​ 2.3 Total service revenue ​ 47.2 ​ 55.3 ​ 59.2 Total revenue ​ $ 420.2 ​ $ 425.2 ​ $ 415.9 (1) A discussion of product revenue is included below under “Results of Operations.” (2) Our volume-related product revenue primarily consists of sales of RNG and conventional natural gas, in the form of CNG and LNG, and sales of RINs and LCFS Credits in addition to changes in fair value of our derivative instruments.
Our business plan calls for approximately $60.0 million in capital expenditures in 2024. These capital expenditures primarily relate to the construction of fueling stations, IT software and equipment and LNG plant costs, and we expect to fund these expenditures primarily through cash on hand and cash generated from operations.
Our business plan calls for approximately $30.0 million in capital expenditures in 2025. These capital expenditures primarily relate to the construction of fueling stations, IT software and equipment and LNG plant costs, and we expect to 49 Table of Contents fund these expenditures primarily through cash on hand and cash generated from operations.
(3) Includes $83.6 million, $24.3 million and $60.6 million of non-cash stock-based sales incentive contra-revenue charges related to the Amazon Warrant (as defined in Note 13) for the years ended December 31, 2021, 2022 and 2023, respectively. (4) The change in fair value of derivative instruments is related to the Company’s commodity swap and customer fueling contracts.
(3) Includes $24.3 million, $60.6 million and $60.8 million of non-cash stock-based sales incentive contra-revenue charges related to the Amazon Warrant (as defined in Note 12) for the years ended December 31, 2022, 2023 and 2024, respectively. 36 Table of Contents (4) The change in fair value of derivative instruments is related to the Company’s commodity swap and customer fueling contracts.
We believe we have sufficient liquidity to support business operations through this volatile period, including total cash and cash equivalents and short-term investments of $263.1 million, excluding current portion of restricted cash, as of December 31, 2023 and $1.8 million of current debt.
We believe we have sufficient liquidity to support business operations through this volatile period, including total cash and cash equivalents and short-term investments of $217.5 million, excluding current portion of restricted cash, as of December 31, 2024 and $1.0 million of current debt.
Income tax benefit was $0.4 million in 2023 compared to income tax expense of $0.2 million in 2022. Income tax expense and/or benefit is primarily related to deferred taxes associated with goodwill and the Company’s expected state tax expense. Loss attributable to noncontrolling interest.
Income tax expense was $2.7 million in 2024 compared to income tax benefit of $0.4 million in 2023. Income tax expense and/or benefit is primarily related to deferred taxes associated with goodwill and other indefinite-lived deferred tax liabilities, and the Company’s expected state tax expense. Loss attributable to noncontrolling interest.
In recent periods, we have experienced increases in commodity and supply chain costs due to inflationary pressures. Additionally, effects stemming from the COVID-19 pandemic have caused disruptions in labor supply and in supply chains, leading to shortages of certain materials and equipment and higher labor costs that have continued to linger to some extent.
In recent periods, we have experienced increases in commodity and supply chain costs due to inflationary pressures. Additionally, effects stemming from disruptions in labor supply and in supply chains, leading to shortages of certain 35 Table of Contents materials and equipment and higher labor costs that have continued to linger to some extent.
These taxes may include, among others, fuel, sales and value-added taxes. We report the collection of these taxes on a net basis and they are excluded from revenue and cost of sales. Income Taxes Income taxes are computed using the asset and liability method.
These taxes may include, among others, fuel, sales and value-added taxes. We report the collection of these taxes on a net basis and they are excluded from revenue and cost of sales.
We had total indebtedness, consisting of our debt and finance leases, of approximately $303.9 million in principal amount as of December 31, 2023, of which approximately $1.8 million, $1.0 million, $0.6 million, $0.4 million, $0.1 million and $300.0 million are expected to become due in 2024, 2025, 2026, 2027, 2028 and thereafter, respectively.
We had total indebtedness, consisting of our debt and finance leases, of approximately $302.9 million in principal amount as of December 31, 2024, of which approximately $1.0 million, $0.9 million, $0.7 million, $0.3 million, $300.0 million and $0.0 million are expected to become due in 2025, 2026, 2027, 2028, 2029 and thereafter, respectively.
GAAP requires management to make estimates 42 Table of Contents and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates and may result in material effects on our operating results and financial position.
GAAP”). The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates and may result in material effects on our operating results and financial position.
Our revenue can vary between periods due to a variety of factors, including, among others, the amount and timing of vehicle fuel sales, natural gas commodity prices, station construction sales, sales of Environmental Credits, and recognition of government credits, grants and incentives, such as AFTC.
Our revenue can vary between periods due to a variety of factors, including, among others, the amount and timing of vehicle fuel sales, natural gas commodity prices, station construction sales, sales of Environmental Credits, and recognition of government credits, grants and incentives, such as AFTC, which expired on December 31, 2024 and has not been renewed.
The Stonepeak Warrant expires on June 15, 2032 and are exercisable at any time after December 12, 2025. See Note 12 for more information about our outstanding debt and Note 13 for additional information about the Stonepeak Warrant. Riverstone Credit Agreement .
The Stonepeak Warrant expires on June 15, 2032 and is exercisable at any time after December 12, 2025. See Note 11 for more information about our outstanding debt and Note 12 for additional information about the Stonepeak Warrant. ​ AFTC.
We recognize O&M and other services revenue in the amount to which we have the right to invoice. We have a right to consideration based on services rendered or on the amount of GGEs of fuel dispensed by the customer multiplied by an agreed-upon rate. Customers are typically billed on a monthly basis.
We have a right to consideration based on services rendered or on the amount of GGEs of fuel dispensed by the customer multiplied by an agreed-upon rate. Customers are typically billed on a monthly basis.
Service cost of sales. Service cost of sales for 2023 increased by $5.7 million to $33.7 million, representing 7.9% of total revenue, from $28.0 million, representing 6.7% of total revenue, in 2022. The increase was primarily due to an increase in GGEs serviced in 2023 when compared to those serviced in 2022. Selling, general and administrative.
Service cost of sales for 2024 increased by $4.2 million to $37.9 million, representing 9.1% of total revenue, from $33.7 million, representing 7.9% of total revenue, in 2023. The increase was primarily due to an increase in GGEs serviced in 2024 when compared to those serviced in 2023. Selling, general and administrative.
(3) Includes $20.7 million, $21.8 million, and $20.9 million of AFTC revenue for the years ended December 31, 2021, 2022 and 2023, respectively. (4) Includes $83.6 million, $24.3 million and $60.6 million of non-cash stock-based sales incentive contra-revenue charges relating to the Amazon Warrant (as defined in Note 13) for the years ended December 31, 2021, 2022 and 2023, respectively.
(3) Includes $24.3 million, $60.6 million and $60.8 million of non-cash stock-based sales incentive contra-revenue charges relating to the Amazon Warrant (as defined in Note 12) for the years ended December 31, 2022, 2023 and 2024, respectively.
We also have indebtedness, including the amount representing interest, from our operating leases of approximately $151.5 million as of December 31, 2023, of which approximately $15.1 million, $15.4 million, $15.4 million, $15.4 million, $14.5 million and $75.7 million are expected to become due in 2024, 2025, 2026, 2027, 2028 and thereafter, respectively.
We also have indebtedness, including the amount representing interest, from our operating leases of approximately $149.2 million as of December 31, 2024, of which approximately $16.7 million, $16.6 million, $16.6 million, $15.8 million, $15.1 million and $68.4 million are expected to become due in 2025, 2026, 2027, 2028, 2029 and thereafter, respectively.
Additionally, these fluctuations in our operating results could cause our performance in any period to fall below the financial guidance we may have provided to the public or the estimates and projections of the investment community, which could negatively affect the price of our common stock.
Additionally, these fluctuations in our operating results could cause our performance in any period to fall below the financial guidance we may have provided to the public or the estimates and projections of the investment community, which could negatively affect the price of our common stock. ​ See “Results of Operations” below for more information about our performance in 2023 and 2024. ​ 41 Table of Contents Fuel Volume.
This RNG project is designed to supply approximately 1.7 million GGEs of RNG annually when at full capacity. As of December 31, 2023, there were four RNG projects under construction in the bp Joint Venture (“bpJV”) that were nearing substantial completion.
This 37 Table of Contents RNG project is designed to supply approximately 1.7 million GGEs of RNG annually when at full capacity. As of December 31, 2024, there were five RNG projects in the bp Joint Venture (“bpJV”) that were completed.
In addition to repaying existing loans, the Stonepeak Credit Agreement will provide us with capital for new RNG production facilities, as well as the expansion of our fueling infrastructure targeting the heavy-duty truck market.
The Stonepeak Credit Agreement also provides for a two-year delayed draw term loan commitment of an additional $100 million. In addition to repaying existing loans, the Stonepeak Credit Agreement will provide us with capital for new RNG production facilities, as well as the expansion of our fueling infrastructure targeting the heavy-duty truck market.
As of December 31, 2023, we were in compliance with all of these covenants. 39 Table of Contents Key Trends Market for RNG and conventional natural gas as a Vehicle Fuel According to CARB, RNG and conventional natural gas are cleaner than gasoline and diesel fuel based on the GHG emissions produced by vehicles operated by these fuels.
Key Trends Market for RNG and conventional natural gas as a Vehicle Fuel ​ According to CARB, RNG and conventional natural gas are cleaner than gasoline and diesel fuel based on the GHG emissions produced by vehicles operated by these fuels.
Loss from equity method investments increased by $7.7 million to $12.5 million in 2023 from $4.8 million in 2022, due to the operating results of SAFE&CEC S.r.l. and our joint venture(s) with TotalEnergies and bp, and our other equity method investees. Income tax (expense) benefit.
Loss from equity method investments increased by $14.1 million to $26.6 million in 2024 from $12.5 million in 2023, due to the operating results of SAFE S.p.A., Rimere and our joint venture(s) with TotalEnergies and bp, and our other equity method investees. Income tax (expense) benefit.
In October 2018, in support of our Zero Now truck financing program, we executed two commodity swap contracts with TotalEnergies Gas & Power North America, an affiliate of TotalEnergies, for a total of five million diesel gallons annually from April 1, 2019 to June 30, 2024.
The amount of this price component will vary based on the anticipated volume and the natural gas price component to be covered under the fixed price sales contract. ​ In October 2018, in support of our Zero Now truck financing program, we executed two commodity swap contracts with TotalEnergies Gas & Power North America, an affiliate of TotalEnergies, for a total of five million diesel gallons annually from April 1, 2019 to June 30, 2024.
Further, in 2024, we anticipate 48 Table of Contents deploying up to approximately $100.0 million to develop ADG RNG production facilities. As of December 31, 2023, we have invested $273.1 million in the development of ADG RNG production facilities, which includes $238.1 million contributed to our joint ventures.
Further, in 2025, we anticipate deploying up to approximately $104.0 million to develop ADG RNG production facilities. As of December 31, 2024, we have invested $321.8 million in the development of ADG RNG production facilities, which includes $271.9 million contributed to our joint ventures.
These significant fluctuations in our operating results may render period-to-period comparisons less meaningful, especially given the current uncertainties relating to macro-economic growth and inflation trends, and investors in our securities should not rely on the results of one period as an indicator of performance in any other period.
Such gains or losses may not recur regularly, in the same amounts or at all in future periods and, with respect to non-cash gains and losses, do not impact our liquidity. ​ These significant fluctuations in our operating results may render period-to-period comparisons less meaningful, especially given the current uncertainties relating to macro-economic growth and inflation trends, and investors in our securities should not rely on the results of one period as an indicator of performance in any other period.
Historically, inflation has not significantly affected our operating results; however, costs for construction, repairs, maintenance, electricity and insurance are all subject to inflationary pressures, which could affect our ability to maintain our stations adequately, build new stations, expand our existing facilities or pursue additional facilities, and could materially impact our operating costs. 47 Table of Contents Liquidity and Capital Resources Liquidity Liquidity is the ability to meet present and future financial obligations through operating cash flows, the sale or maturity of investments or the acquisition of additional funds through capital management.
Historically, inflation has not significantly affected our operating results; however, costs for construction, repairs, maintenance, electricity and insurance are all subject to inflationary pressures, which could affect our ability to maintain 48 Table of Contents our stations adequately, build new stations, expand our existing facilities or pursue additional facilities, and could materially impact our operating costs.
Any of these outcomes could force us to purchase credits in the open market to cover any credits we have contracted to sell, retire credits we may have generated but not yet sold, reduce or eliminate a significant revenue stream or incur substantial additional and unplanned expenses.
Any of these outcomes could force us to purchase credits in the open market to cover any credits we have contracted to sell, retire credits we may have generated but not yet sold, reduce or eliminate a significant revenue stream or incur substantial additional and unplanned expenses. ​ Risk Management Activities ​ From time to time, we enter into fuel sales contracts that require us to sell CNG or LNG to our customers at a fixed price.
No liability has been recorded in connection with our surety bonds because, based on historical experience and available information, we do not believe it is probable that any amounts will be required to be paid under these arrangements for which we will not be reimbursed. 50 Table of Contents As of December 31, 2023, we had quarterly fixed-price natural gas purchase contracts with take-or-pay commitments extending through September 2024.
No liability has been recorded in connection with our surety bonds because, based on historical experience and 51 Table of Contents available information, we do not believe it is probable that any amounts will be required to be paid under these arrangements for which we will not be reimbursed.
Under a 50-50 shared investment, we and Tourmaline expect to construct and commission up to 20 CNG fueling stations over the next five years, allowing heavy-duty trucks and other commercial transportation fleets that operate in the area to transition to the use of CNG, a lower carbon alternative to gasoline and diesel.
Under a 50-50 shared investment, the construction of these CNG fueling stations will allow heavy-duty trucks and other commercial transportation fleets that operate in the area to transition to the use of CNG, a lower carbon alternative to gasoline and diesel.
In an effort to mitigate the volatility of our earnings related to any futures contracts and to reduce our risk related to our fixed price sales contracts, we operate under a hedging policy pursuant to which we purchase futures contracts to hedge our exposure to variability in expected future cash flows related to a particular fixed price contract or bid.
These contracts expose us to the risk that the price of natural gas commodity may increase above the natural gas commodity cost component included in the price at which we are committed to sell the natural gas to our customers. ​ In an effort to mitigate the volatility of our earnings related to any futures contracts and to reduce our risk related to our fixed price sales contracts, we operate under a policy pursuant to which we purchase future physical delivery, fixed price contracts to hedge our exposure to variability in expected future cash flows related to a particular fixed price contract or bid.
In addition, as of December 31, 2023, we had a fixed supply arrangement with UPS for the supply and sale of 170.0 million GGEs of RNG through March 2026.
As of December 31, 2024, we had quarterly fixed-price natural gas purchase contracts with take-or-pay commitments extending through March 2025. In addition, as of December 31, 2024, we had a fixed supply arrangement with UPS for the supply and sale of 170.0 million GGEs of RNG through March 2026.
The amounts are classified as revenue because the Company’s commodity swap contracts are used to economically offset the risk associated with the diesel-to-natural gas price spread resulting from customer fueling contracts under the Company’s Zero Now truck financing program. (5) Represents AFTC. AFTC is available for vehicle fuel sales made through December 31, 2024.
The amounts are classified as revenue because the Company’s commodity swap contracts are used to economically offset the risk associated with the diesel-to-natural gas price spread resulting from customer fueling contracts under the Company’s Zero Now truck financing program. (5) Includes net settlement of the Company’s commodity swap derivative instruments.
Any inability to raise necessary capital may impair our ability to develop and maintain fueling infrastructure, invest in strategic transactions or acquisitions or repay our outstanding indebtedness and may reduce our ability to support and build our business and generate sustained or increased revenue. 49 Table of Contents Material Cash Requirements The table below presents our material cash requirements, including the scheduled maturities of our contractual obligations and our commitments for capital expenditures as of December 31, 2023.
Any inability to raise necessary capital may impair our ability 50 Table of Contents to develop and maintain fueling infrastructure, invest in strategic transactions or acquisitions or repay our outstanding indebtedness and may reduce our ability to support and build our business and generate sustained or increased revenue.
On April 10, 2023, an accident resulted in a fire at the South Fork Dairy farm in Dimmitt, Texas, the location of one of our 100% owned ADG RNG projects under development. The fire killed approximately 18,000 dairy cows and injured one person. Our partner, South Fork Dairy, plans to rebuild the dairy farm and to replenish the dairy cattle.
On April 10, 2023, an accident resulted in a fire at the South Fork Dairy farm in Dimmitt, Texas, the location of one of our consolidated ADG RNG projects under development. The fire killed the dairy cows and burned down the milking facilities. Our partner, South Fork Dairy, is rebuilding the dairy farm and replenishing the dairy cattle.
If these conditions continue, then the growth levels in this market will continue to be low. We believe the newest models of heavy-duty natural gas truck engines have substantially addressed concerns with prior models. Further, we have launched our Zero Now truck financing program and the Chevron Adopt-A-Port program to combat operator concerns, but these programs may ultimately be unsuccessful.
If these conditions continue, then the growth levels in this market will continue to be low. We believe the newest models of heavy-duty natural gas truck engines have substantially addressed concerns with prior models.
At the time of the incident, we had not commenced onsite construction activities. Rebuilding efforts were initiated in late 2023. Since then, we have begun to prepare for the construction of the ADG RNG project, and construction activities may start as early as the first quarter of 2024.
At the time of the incident, we had not commenced onsite construction activities. Rebuilding efforts were initiated in late 2023. Since then, we have begun to prepare for the construction of the ADG RNG project. In July 2024, the Company broke ground on construction of the RNG production facility at South Fork Farm Dairy.
Overview We are North America’s leading provider of the cleanest fuel for the transportation market, based on the number of stations operated and the amount of gasoline gallon equivalents (“GGEs”) of renewable natural gas (“RNG”) and conventional natural gas sold.
See the discussion about these statements under “Cautionary Note Regarding Forward-Looking Statements” at the beginning of this report. 34 Table of Contents Overview We are North America’s leading provider of the cleanest fuel for the transportation market, based on the number of stations operated and the amount of gasoline gallon equivalents (“GGEs”) of renewable natural gas (“RNG”) and conventional natural gas sold.
For example, in 2023, market prices for RINs have been as high as $3.55 and as low as $1.88.
For example, in 2024, market prices for RINs have been as high as $3.57 and as low as $2.08.
The increase in cash used in investing activities in 2023 was primarily attributable to a $62.6 million net increase in capital expenditures on property and equipment and on RNG production projects, a $3.6 million increase in net purchases of short-term investments in 2023 when compared to 2022, and a $3.9 million decrease in net cash receipts from sale of certain assets of subsidiary.
The decrease in cash used in investing activities in 2024 was primarily attributable to a $48.4 million increase in net maturities of short-term investments in 2024 when compared to that in 2023, a $44.4 million net decrease in capital expenditures on property and equipment and on RNG production projects, and a $40.6 million decrease in investments in other entities.
Unless otherwise agreed in advance by our Board of Directors and the derivatives committee thereof, we will conduct our futures contract activities and enter into fixed price sales contracts only in accordance with our hedging policy. Due to the restrictions of our hedging policy, we expect to offer few fixed price sales contracts to our customers.
Subject to the conditions set forth in the policy, we purchase physical delivery fixed price contracts in quantities reasonably expected to effectively hedge our exposure to cash flow variability related to fixed price sales contracts entered into after the date of the policy. ​ Unless otherwise agreed in advance by our Board of Directors and the derivatives committee thereof, we will conduct our futures contract activities and enter into fixed price sales contracts only in accordance with our policy. ​ 42 Table of Contents Due to the restrictions of our policy, we expect to offer few fixed price sales contracts to our customers.
Interest expense increased by $16.6 million to $22.9 million in 2023 from $6.3 million in 2022, primarily due to (1) higher outstanding indebtedness and higher average interest rates on outstanding indebtedness in 2023, (2) an increase in amortization of debt discount and issuance costs due to our debt under the Riverstone Credit Agreement, and (3) an increase in debt extinguishment loss relating to the extinguishment of the Sustainability-Linked Term Loan pursuant to the Riverstone Credit Agreement (see Note 12).
Interest expense increased by $9.3 million to $32.2 million in 2024 from $22.9 million in 2023, primarily due to (1) a 11.5 million increase due to higher outstanding indebtedness, (2) a $3.2 million increase due to higher amortization of debt discount and issuance costs, partially offset by a $5.4 million debt extinguishment loss relating to extinguishment of the Sustainability-Linked Term Loan pursuant to the Riverstone Credit Agreement (each as defined and described in Note 11 to the note to consolidated financial statements) in 2023.
This table excludes certain potential cash requirements because they may involve future cash payments that are considered uncertain and cannot be estimated because they vary based upon future conditions; however, the exclusion of these obligations should not be construed as an implication that they are immaterial, as they could significantly affect our short- and long-term liquidity and capital resource needs depending on a variety of future events, facts and conditions. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payments Due by Period ​ ​ ​ ​ Less than ​ ​ ​ ​ ​ More than Contractual Obligations: (in thousands) Total 1 year 1 - 3 years 3 - 5 years 5 years Long-term debt (1) ​ $ 472,380 ​ $ 29,045 ​ $ 57,932 ​ $ 58,012 ​ $ 327,391 Finance lease obligations (2) ​ ​ 4,009 ​ ​ 1,979 ​ 1,665 ​ 365 ​ — Operating lease commitments (3) ​ 151,543 ​ 15,125 ​ ​ 30,769 ​ ​ 29,890 ​ ​ 75,759 Long-term take-or-pay contracts (4) ​ 13,227 ​ 13,227 ​ — ​ — ​ — Construction contracts (5) ​ 35,949 ​ 35,949 ​ — ​ — ​ — Capital expenditure for RNG project (6) ​ ​ 2,572 ​ ​ 2,572 ​ ​ — ​ ​ — ​ ​ — Total ​ $ 679,680 ​ $ 97,897 ​ $ 90,366 ​ $ 88,267 ​ $ 403,150 (1) Represents long-term debt, including future interest payments, to finance acquisitions, equipment purchases and development of RNG production projects.
This table excludes certain potential cash requirements because they may involve future cash payments that are considered uncertain and cannot be estimated because they vary based upon future conditions; however, the exclusion of these obligations should not be construed as an implication that they are immaterial, as they could significantly affect our short- and long-term liquidity and capital resource needs depending on a variety of future events, facts and conditions. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Payments Due by Period ​ ​ ​ ​ Less than ​ ​ ​ ​ ​ More than Contractual Obligations: (in thousands) Total 1 year 1 - 3 years 3 - 5 years 5 years Long-term debt (1) ​ $ 443,302 ​ $ 28,960 ​ $ 57,933 ​ $ 356,409 ​ $ — Finance lease obligations (2) ​ ​ 3,110 ​ ​ 1,143 ​ 1,725 ​ 242 ​ — Operating lease commitments (3) ​ 149,233 ​ 16,663 ​ ​ 33,229 ​ ​ 30,925 ​ ​ 68,416 Long-term take-or-pay contracts (4) ​ 1,463 ​ 1,463 ​ — ​ — ​ — Construction contracts (5) ​ 17,356 ​ 17,356 ​ — ​ — ​ — Capital expenditure for RNG project (6) ​ ​ 24,997 ​ ​ 24,997 ​ ​ — ​ ​ — ​ ​ — Total ​ $ 639,461 ​ $ 90,582 ​ $ 92,887 ​ $ 387,576 ​ $ 68,416 (1) Represents long-term debt, including future interest payments, to finance acquisitions, equipment purchases and development of RNG production projects.
Interest income. Interest income increased by $7.7 million to $11.1 million in 2023 from $3.4 million in 2022, primarily due to higher average interest rates between periods earned on the Company’s short-term investments. Loss from equity method investments.
Interest income. Interest income increased by $2.9 million to $14.0 million in 2024 from $11.1 million in 2023, primarily due to higher average interest rates of the Company’s short-term investments and loan receivables. Loss from equity method investments.
These commodity swap contracts are intended to manage risks related to the diesel-to-natural gas price spread in connection with the natural gas fuel supply commitments we have made and expect to make in our current and anticipated fueling agreements with fleet operators that participate in the Zero Now program.
These commodity swap contracts were intended to manage risks related to the diesel-to-natural gas price spread in connection with the natural gas fuel supply commitments we have made and expect to make in our current and anticipated fueling agreements with fleet operators that participate in the Zero Now program. ​ Critical Accounting Policies and Estimates This discussion is based upon our consolidated financial statements included in this report, which have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S.
Our service revenue consists of sales of O&M and other services. O&M and other services are sold pursuant to contractual commitments over defined performance periods. These contracts typically include a stand-ready obligation to provide O&M and/or other services based on a committed and agreed upon routine maintenance schedule or when and if called upon by the customer.
These contracts typically include a stand-ready obligation to provide O&M and/or other services based on a committed and agreed upon routine maintenance schedule or when and if called upon by the customer. 43 Table of Contents We recognize O&M and other services revenue in the amount to which we have the right to invoice.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeNatural gas prices and availability are affected by many factors, including, among others, drilling activity, supply, weather conditions, overall economic conditions and foreign and domestic government regulations. Natural gas costs represented $111.8 million, $182.4 million, and $190.6 million of our cost of sales in 2021, 2022, and 2023, respectively.
Biggest changeNatural gas prices and availability are affected by many factors, including, among others, drilling activity, supply, weather conditions, overall economic conditions and foreign and domestic government regulations. Natural gas costs represented $182.4 million, $190.6 million, and $124.0 million of our cost of sales in 2022, 2023, and 2024, respectively.
However, if our lenders have increased costs due to changes in LIBOR, we may experience potential increases in interest rates on our variable rate debt or fees on our fixed rate debt, which could adversely affect our interest expense, results of operations and cash flows. ​ 51 Table of Contents
However, if our lenders have increased costs due to changes in LIBOR, we may experience potential increases in interest rates on our variable rate debt or fees on our fixed rate debt, which could adversely affect our interest expense, results of operations and cash flows. ​ 52 Table of Contents
Foreign Currency Exchange Rate Risk For the year ended December 31, 2023, our primary exposure to foreign currency exchange rates relates to our Canadian operations that had certain outstanding accounts receivable and accounts payable denominated in Canadian dollar, which were not hedged.
Foreign Currency Exchange Rate Risk For the year ended December 31, 2024, our primary exposure to foreign currency exchange rates relates to our Canadian operations that had certain outstanding accounts receivable and accounts payable denominated in Canadian dollar, which were not hedged.
We have prepared a sensitivity analysis to estimate our exposure to price risk with respect to our commodity swap contracts. If the diesel-to-natural gas price spread were to fluctuate by 10% as of December 31, 2023, we would expect a corresponding fluctuation in the fair value of our commodity swap contracts of approximately $0.1 million.
We have prepared a sensitivity analysis to estimate our exposure to price risk with respect to our commodity swap contracts. If the diesel-to-natural gas price spread were to fluctuate by 10% as of December 31, 2024, we would expect a corresponding fluctuation in the fair value of our commodity swap contracts of approximately $0.4 million.
If the exchange rates on these assets and liabilities were to fluctuate by 10% from the rates as of December 31, 2023, we would expect a corresponding fluctuation in the value of the net assets to be immaterial. Interest Rate Risk As of December 31, 2023, we had no debt that bears a variable rate of interest.
If the exchange rates on these assets and liabilities were to fluctuate by 10% from the rates as of December 31, 2024, we would expect a corresponding fluctuation in the value of the net assets to be $0.1 million. Interest Rate Risk As of December 31, 2024, we had no debt that bears a variable rate of interest.
Certain LIBOR tenors were discontinued after 2021 with other LIBOR tenors discontinued after June 2023. We intend to monitor the developments with respect to the discontinuance of LIBOR and work with our lenders to minimize the effect of such a discontinuance on our financial condition and results of operations.
Certain LIBOR tenors were discontinued after 2021 with other London Inter-bank Offered Rate (“LIBOR”) tenors discontinued after June 2023. We intend to monitor the developments with respect to the discontinuance of LIBOR and work with our lenders to minimize the effect of such a discontinuance on our financial condition and results of operations.
Removed
In October 2018, in support of our Zero Now truck financing program, we entered into two commodity swap contracts with TotalEnergies Gas & Power North America, an affiliate of TotalEnergies, for a total of five million diesel gallons annually from April 1, 2019 to June 30, 2024.
Removed
These commodity swap contracts are intended to manage risks related to the diesel-to-natural gas price spread associated with the natural gas fuel supply commitments we make in our fueling agreements with fleet operators who participate in the Zero Now truck financing program.

Other CLNE 10-K year-over-year comparisons