What happened
Shares of Clean Energy Fuels (CLNE -0.87%) popped 72.7% in December, according to data provided by S&P Global Market Intelligence, after Congress passed some helpful renewable energy subsidies. Shares have continued their run in January, rising another 30.7% as I am writing.
So what
There were a few positive news items for Clean Energy Fuels last month. On Dec. 21, the company announced partnerships with Total (TTE -0.32%) and BP (BP 0.13%) to build carbon-negative renewable natural gas fuel facilities and infrastructure. These agreements not only provide funding for fuel production, they give Clean Energy Fuels some big-name partners that will lend this form of natural gas more viability in the market.
Image source: Getty Images.
The stimulus package passed in late December also included an extension of the Alternative Fuels Tax Credit of $0.50 per gallon and the Alternative Fuel Vehicle Refueling Property Credit, an investment tax credit of 30% or $30,000 for refueling property. These financial subsidies help make renewable natural gas more financially viable for Clean Energy Fuels.
Now what
The subsidies and funding deals give Clean Energy Fuels both a path to more investment in infrastructure and better unit economics for fuel. In time, that could help the company's bottom line and build a more sustainable business in the long term. That's what investors were betting on last month, and they're seeing an even brighter future in the first few days of 2021.
