Clean Energy Fuels Corp. and its largest shareholder, Total SE, have formed a 50/50 joint venture (JV) to develop carbon-negative renewable natural gas (RNG) production facilities in the U.S., as well as credit support to build additional downstream RNG fueling infrastructure.
The initial firm commitment is $100 million and can increase to $400 million as development opportunities progress. Since Clean Energy and Total will be providing the equity portion of the investments, the actual amount of capital invested in RNG projects may be higher than $400 million depending on the amount of leverage that is deployed. In addition, Total will be providing credit support for Clean Energy development in the RNG value chain, including $45 million for contracted RNG fueling infrastructure.
“The finalization of this JV with Total, which was originally announced in December of last year, demonstrates the commitment both companies have to the growth of RNG, a fuel that can tackle serious climate issues today,” says Andrew J. Littlefair, CEO and president of Clean Energy. “The demand by customers for RNG continues to accelerate, highlighted by our recent announcement that the largest bus fleet in the U.S., LA Metro, had converted their entire fleet to RNG. This JV will help Clean Energy to continue to increase its supply of RNG in the years ahead.”
Carbon-negative RNG is produced when carbon emissions are captured from dairies and turned into a transportation fuel, reducing the harmful effects on long-term climate change. Clean Energy says it is the largest provider of RNG as a transportation fuel in the U.S. – and the largest RNG fuel provider under the California LCFS program.
The companies have already partnered to expand the use of RNG in the heavy-duty truck market with the Zero Now program, which allows fleets to purchase RNG trucks for the same price as diesel trucks. The demand for carbon-negative RNG has rapidly accelerated through the Zero Now program with trucking companies such as Kenan Advantage, KeHE Distributors, Estes Express Lines and Tradelink Transport taking advantage of the economic savings while powering their new fleets with Clean Energy’s RNG.