Amazon Inc. said it has inked a five-year contract for renewable natural gas (RNG) with Clean Energy Fuels Corp. and could take up to a 20% stake in the fuel supplier over the next decade.

Beginning last Friday (April 16), RNG is to be provided to Amazon.com NV Investment Holdings LLC through 27 existing fueling outlets and 19 new fueling stations expected to be operational later this year. The stations are spread over 15 states.

In addition, Clean Energy issued a warrant to Amazon’s investment unit to purchase in tranches more than 53.1 million shares at a price of $13.49 each through April 16, 2031. The first tranches are for 13.3 million shares in connection to the fuel agreement, Clean Energy spokesperson Raleigh Gerber said. “The other tranches vest as Amazon purchases additional fuel and services with Clean Energy, up to $500 million.”

The transaction is structured so that Amazon, which aims to become carbon-neutral by 2040, may do more business with Clean Energy, according to Gerber.

“If the world is really going to tackle the issue of climate change, all of us need to find solutions that work both environmentally and economically, and that is exactly what this agreement supports,” said Clean Energy CEO Andrew Littlefair.

Clean Energy last year secured separate partnerships with BP plc and Total SE to consider expanding U.S. RNG production.

According to the  Natural Gas Vehicles for America and Coalition for Renewable Natural Gas, RNG use as a transportation fuel grew 25% last year over 2019 volumes and is up 267% over the last five years.  In 2020, a total of 646 million gallons of natural gas was used as motor fuel, including 345 million RNG gallons.

Elsewhere, Southern California Gas Co. (SoCalGas) plans to outfit 200 new Ford F-250 utility service trucks to operate on RNG, using long standing partner Landi Renzo USA’s “Eco Ready” engine modification equipment that was earlier certified as ultra-low emissions by the California Air Resources Board. 

With the addition of these 200 new net-zero emissions service trucks, nearly 40% of SoCalGas’ service vehicles will run on clean fuels. 

“Putting more clean trucks on the road is a key part of SoCalGas’ commitment to achieve net-zero greenhouse gas (GHG) emissions in its operations and delivery of energy by 2045,” a SoCalGas spokesperson said. 

SoCalGas Vice President Sandra Hrna said this project is “one of the many decarbonizing initiatives we’re implementing as we continue to move towards a net-zero future.” 

The added service trucks are a key part of SoCalGas’ commitment to achieve net-zero greenhouse gas (GHG) emissions in its operations and delivery of energy by 2045, she said.