Republic Services, Inc.
) has inked a deal with Clean Energy Renewable Fuels, a wholly
owned subsidiary of
Clean Energy Fuels Corp.
), to recover landfill gas from the North Shelby Landfill in
CLEAN EGY FUELS (CLNE): Free Stock Analysis
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Per the deal, Clean Energy Renewable Fuels will build the high
British Thermal Unit (BTU) plant which will process landfill gas
and also distribute it into the U.S. natural gas network. The
landfill gas recovered will be used as vehicle fuel for natural
gas-powered fleet besides other possible uses.
Operations in the plant are expected to commence in 2013. During
the first year, it is anticipated that it will produce 4 million
diesel gallon equivalents of renewable natural gas fuel annually.
Eventually, during the first 10 years of operation, production will
increase to more than 5.7 million diesel gallon equivalents per
The companies have a similar agreement for Republic's Sauk Trails
Landfill in Canton, Michigan. The operations in the landfill
are likely to start from September this year.
These agreements will give Republic Services the best possible
opportunity for utilization of its energy endeavor in the
landfills. The landfill gases being renewable and environment
friendly are more sustainable and contribute less to the carbon
cycle, releasing up to 88% less greenhouse gas emissions than
diesel fuel or gasoline.
Renewable biofuel for transports represent a key source of
diversification from petroleum products which are non-renewable
sources of energy and fast depleting. The rising oil demand, if
continued unchecked, will inevitably lead to severe supply
disruptions resulting in price shocks. Therefore, the renewable
natural gas fuels are gaining more popularity over the
non-renewable sources as people seem to have a preference for
sustainable development now-a-days.
Republic Services reported second-quarter adjusted earnings of 59
cents per share, beating the Zacks Consensus Estimate of 49 cents.
Total revenues decreased 1.2% year over year to $2.06 billion,
lagging the Zacks Consensus Estimate of $2.11 billion.
Difficult pricing environment coupled with constrained volumes is a
major conern for Republic Services. Soft economic conditions and
weak customer confidence add to the concern.
Republic Services also faces stiff competition from
Waste Management, Inc.
). The company retains a short-term Zacks #3 Rank (Hold). We have a
long-term Underperfrom recommendation on the stock.