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Clean Energy to Produce Low-Carbon Transportation Fuel With BP

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Clean Energy Fuels Corporation (CLNE - Free Report) entered a joint venture with BP Products North America Inc., a subsidiary of integrated major BP P.L.C. (BP - Free Report) , for the purpose of producing more carbon-neutral fuel.

Clean Energy and BP Products formed the joint venture to develop, own and operate new renewable natural gas (“RNG”) projects at dairy farms and other agricultural facilities to produce cleaner fuels with few greenhouse gas emissions.

RNG is made from methane that has been extracted from dairies and then transformed into transportation fuels. It has lower greenhouse gas emissions compared to conventional gasoline and diesel, and will help lower the catastrophic effects of climatic fluctuations.

Hence, the California Air Resources Board granted a carbon intensity score of -250 to the carbon-negative RNG projects compared with 97 for diesel and 46 for electric batteries. Notably, the carbon intensity score calculates the extent of carbon emitted during the lifecycle of a given fuel — from producing to burning.

In recent years, climate change and the devastating impacts of the coronavirus pandemic have accelerated the demand for carbon-neutral fuels. Therefore, several heavy-duty vehicle fleets in the world, including UPS, Republic Services, New York Metropolitan Transportation Authority and LA Metro, are efficiently operating numerous vehicles on renewable fuels.

BP will fund $50 million for the development and construction of the RNG facilities. Importantly, growth in Clean Energy’s RNG portfolio is in line with BP’s aim to become a net-zero emission business by 2050 and help customers lower their carbon footprint.

Company Profile & Price Performance

Headquartered in Newport Beach, CA, Clean Energy is the leading provider of natural gas (CNG and LNG) for transportation in North America.

Shares of the utility have outperformed the industry in the past six months. Its stock has gained 419.9% compared with the industry’s 17.5% growth.

 

 

Zacks Rank & Stocks to Consider

Clean Energy currently carries a Zacks Rank #4 (Sell).

Some better-ranked players in the utility space are NewJersey Resources Corporation (NJR - Free Report) and ENN Energy Holdings Ltd. (XNGSY - Free Report) , each presently carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

NewJersey Resources’ earnings for 2021 are expected to rise 40.3% year over year.

ENN Energy’s earnings for 2021 are expected to increase 10.3% year over year.

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