Clean Energy Corp., the largest builder and operator of natural gas stations in the U.S., is part of an industry segment that’s put some life into the sluggish clean-technology industry.
The Seal Beach-based company is building the fuel-stop infrastructure to support public and commercial transportation fleets and has struck several major deals with municipalities, trucking companies and waste-management firms. It’s expanding what it calls America’s Natural Gas Highway, with major transportation arteries in California, Texas and the Midwest pegged for natural gas stations spread out every 250 miles or so when the multiyear project concludes.
The company’s spate of deals, coupled with rising marketplace demand for clean-burning natural gas, has charted a growth path for Clean Energy that landed it in the No. 17 spot on this week’s list of Fastest-Growing Public Companies (see list, page 40). Clean Energy saw revenue of $301.7 million during 12 months through June for a 92% increase from a similar period two years earlier.
The company will build 125 stations this year, up from 60 in 2011. About 70 stations will be constructed by the end of the year throughout the Midwest, Southeast and Northeast as part of the natural gas highway.
“We’re still in the early innings of growth,” Chief Executive Andrew Littlefair said.
Clean Energy has yet to reach profitability despite the strong revenue gains, as it continues to put large sums into its infrastructure projects.
Richest Niche
The company is targeting the largest segment of the market: heavy-duty haulers that consume some $30 billion of fuel annually. That dwarfs the public sector and waste-management industries combined—not that Clean Energy is ignoring those sectors in its growth strategy.
Last month it signed a deal to sell compressed natural gas to government vehicles in Virginia. Clean Energy plans to build fueling stations for the state and various local governments, while supporting vehicle conversions throughout Virginia.
Another recent pact—with Honda Motor Co.—provided a point of entry to the consumer market, a relatively untapped clean-tech segment.
Debit cards with $3,000 are given to buyers of Honda’s 2012 Civic natural-gas vehicles. They must be used at Clean Energy fueling stations.
The natural-gas Civic, which costs about $5,650 more than the gas version, is available at 199 dealerships in 36 states and represents the first natural-gas-powered automobile released by a major automaker.
The vehicle—rated to get 27 mpg for city travel and 39 on highways—gets diamond-lane privileges on California’s freeways.
“This is a significant deal,” Littlefair said.
Meantime, the U.S. supply of natural-gas deposits is so abundant that companies including Oklahoma City-based Chesapeake Energy Corp.—a Clean Energy backer—have cut back operations.
200-Year Supply
Industry experts peg natural gas reserves in the U.S. at 750 billion barrels after conversion. By comparison, Saudi Arabia has 250 billion barrels of oil on reserve.
In the past five years natural gas reserves rose from a 20-year supply to 200 years, according to Littlefield.
“The U.S. has more natural gas reserves than any other country,” he said.
The issue has taken national prominence in the presidential election as each candidate has vowed to increase natural gas production in the U.S. if elected.
“Both candidates understand this is a jobs issue,” Littlefair said. “This is not going to be a flash in the pan.”
The natural-gas movement has sparked new competitors to enter the field, including Netherlands-based Royal Dutch Shell PLC and several regional players. Clean Energy welcomes the competition, which should help boost adoption and infrastructure for the emerging sector.
“It will give assurance to those shippers and truckers questioning whether that infrastructure will be in place,” Littlefair said.
Fleet conversions are tied both to the attractive economics of running on natural gas, as well as the broader push to reduce carbon emissions by vehicles of all sorts.
Clean Energy has signed some 150 non-disclosure deals with some of the nation’s largest companies, Littlefair said.
“They all have very aggressive self-imposed sustainability programs,” he said. “They’re taking this very seriously.”
