RNG Production for Vehicle Fuel April 4, 2018
Forward-Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 that involve risks, uncertainties and assumptions, such as statements regarding, among other things: growth in the market for natural gas and other alternative vehicle fuels; sales of growing volumes of natural gas vehicle fuel; Clean Energy s natural gas fueling infrastructure; the benefits of natural gas (including RNG) as an alternative vehicle fuel, including its effectiveness and economic and environmental benefits; continued interest and investment in natural gas as a vehicle fuel; and the success of Clean Energy s relationship with BP and other strategic partnerships. Actual results and the timing of events could differ materially from those anticipated in or implied by these forward-looking statements as a result of many factors including, among others: future supply, demand, use and prices of crude oil, gasoline, diesel, natural gas and other alternative fuels, as well as heavy-duty trucks and other vehicles powered by these fuels; the willingness of fleets and other consumers to adopt natural gas as a vehicle fuel; Clean Energy s ability to capture a substantial share of the market for alternative vehicle fuels and otherwise compete successfully in this market; Clean Energy s ability to recognize the anticipated benefits of building CNG and LNG stations, including receiving revenue from these stations equal to or greater than their costs or at all; future availability of capital, including equity or debt financing, as needed to fund Clean Energy s business and repayment of its debt obligations (whether at or prior to maturity); the availability of tax credits and other government programs or incentives that promote natural gas or other alternatives as a vehicle fuel; changes to federal, state or local fuel emission standards or other environmental regulations applicable to natural gas production, transportation or use; compliance with other applicable government regulations; Clean Energy s ability to manage and expand its RNG business after the sale of the upstream production portion of this business; construction, permitting and other factors that could cause delays or other problems at station construction projects; Clean Energy s ability to sustain or increase its compressor business and manage risks and uncertainties related to the global scope of this business; Clean Energy s ability to realize the intended benefits of any mergers, acquisitions, divestitures, investments or other strategic transactions or relationships; and general political, regulatory, economic and market conditions. The forward-looking statements made in this press release speak only as of the date of this press release and Clean Energy undertakes no obligation to update publicly such forward-looking statements to reflect subsequent events or circumstances, except as otherwise required by law. Clean Energy s Annual Report on Form 10-K, filed on March 3, 2018 with the Securities and Exchange Commission (www.sec.gov), contains additional information on these and other risk factors that may cause actual results to differ materially from the forward-looking statements contained in this press release. 2
Largest Alternative Transportation Fuel Provider 2017 CLEAN ENERGY HIGHLIGHTS 351MM GALLONS SOLD 78 MM RNG GALLONS SOLD $342MM OF REVENUE 970+ FLEETS 45,000+ NGVS FUELED DAILY 42 575+ NATURAL GAS FUELING STATIONS STATES & CANADA 3
25B Gallons of Fuel Used Per Year By Market 1-1.5B 2B 2B 1.6 B 3.6B 6.6B Transit buses Airport vehicles Refuse trucks Heavy duty trucks Mining Gallons of Fuel Used Per Year 4 Rail Marine
BIOMETHANE SUPPLY CHAIN 1 CAPTURE & EXTRACT Biogas is derived from various organic waste sources such as landfills and farms. 2 PROCESS & PURIFY After it is processed to required standards of purity, biomethane becomes a renewable substitute for natural gas. 3 ENTERS INTERSTATE FUEL PIPELINE Once compressed or liquefied, biomethane is sent into the interstate fuel pipeline system. 4 MADE AVAILABLE AT FUELING STATIONS The biomethane is routed to designated Clean Energy stations that fuel an array of commercial vehicles.
Driving Future Growth The Cleanest Fuel Available in the U.S. Today 100% Renewable Fuel Can be CNG or LNG Achieves Sustainability Goals for companies and agencies faster than any other initiative Can be sent to any of Clean Energy s 570+ public and private stations Lowers GHG by 70% CLEANER COST EFFICIENT RENEWABLE DOMESTIC 6
Driving Future Growth CWI Next Generation Zero NO x Engines As Clean or Cleaner Than Electric 9L Available Today for Refuse and Transit Markets 1000 s already been ordered by Waste Management, Los Angeles Metro, Santa Monica Big Blue Bus and others 12L Hits Market in 2018 Perfect timing as Ports of LA and Long Beach adopt strict air quality standards on trucks 6.7L available today for school bus, shuttle, transit, and vocational vehicle markets 7
Driving Future Growth Source: Ramboll Environ US Corporation, Zero Emission Bus Options: Fleet Analysis of 2015-2055 Fleet Cost and Emissions, Figure 1: LACMTA Zero Emission Bus Estimated Total Fleet Emissions 2015 2055. 8
Renewable Fuel Standard Renewable Fuel Standard 2 (RFS2) expanded and extended the original RFS program under the Energy Independence Act of 2007 and set specific mandates for the consumption of renewable fuels in the US The US EPA developed the RIN system to ensure compliance with RFS2 RINs are generated by the producer or importer of renewable fuels to each gallon of biofuel produced and reported to EPA RINs are then sold to obligated parties (gasoline and diesel producers and/or importers) Obligated parties are required to achieve a minimum of 36 billion gallons by 2022 Clean Energy can assist in the generation and sale of RINs to obligated parties for an additional revenue stream 9
Renewable Fuel Standard Waiver Credit $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $- Gasoline Bulk Sale Price by Refiners Gasoline Bulk Sale Price by Refiners Waiver Credit Price Per GGE $3.50 $3.00 $2.50 $2.00 $1.50 $1.00 $0.50 $- 2014 2015 2016 2017 2018 Waiver Credit Price Per GGE 10
RNG Industry Growth (000,000's) D3 RINs Generated RVO 350 300 311 288 288 250 230 240 200 190 150 100 140 123 50 33 33-2014 Actual Actual 2015 Actual Actual 2016 Actual Actual 2017 Forecast Actual 2018 Forecast Actual Source: EPA RFS2 11
RIN Market Pricing per GGE $4.60 D3 RIN Value per GGE $4.40 $4.20 $4.00 $3.80 $3.60 $3.40 $3.20 Source: Argus America Biofuels 12
Low Carbon Fuel Standard The Low Carbon Fuel Standard (LCFS) is California s primary greenhouse gas emissions reduction measure transportation fuels, requiring a 10% reduction in the carbon intensity (CI) of gasoline and diesel from 2010 levels by 2020 LCFS sets annual CI limits for transportation fuels Fuel and fuel blendstocks generate credits and deficits depending on their CI relative to the applicable program standard for any given calendar year LCFS credit prices have had strong tailwinds in light of ambitious carbon reduction goals and biofuel supply shortage LCFS is a critical part of California s climate policy California Air Resources Board is focused on LCFS as a primary GHG reduction mechanism 13
LCFS Market Pricing per GGE $0.70 LCFS Credit Value per GGE $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $- Source: Argus America Biofuels, based on 45 gco2e/mj 14
California RNG Market 180 160 140 RNG as % Total NGV Market in California 50% 62% 64% 87% 120 MM DGEs 100 80 60 40 20-2015 2016 2017 (Expected) 2018 (Expected) RNG Fossil NG Source: California Air Resources Board LCFS program data, Q2 2017 15
RNG Market Pricing Total Value per GGE $4.50 $4.00 $3.50 $3.00 $2.50 7/14: Most RNG reclassified as D3 Cellulosic Biofuel $0.38 $0.39 $0.38 $0.34 $2.00 $1.50 $1.00 $0.38 $0.34 $0.38 $0.22 $0.38 $0.23 $3.09 $2.74 $0.50 $1.02 $0.77 $1.18 $- 2013 2014 2015 2016 2017 RIN Value per GGE LCFS Value per GGE Gas Commodity Cost of Production Source: CARB, Argus and OPIS RIN and LCFS data, 2013-2017 16
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