What are the RNG community's policy wishes for Set 3, and is there potential for the EPA to revisit eRINs?

Management expressed a desire for the EPA to acknowledge RNG's potential as a transportation fuel, incentivize cellulosic growth, and support domestic production. They were skeptical about the potential for eRINs or expanded new pathways in the upcoming Set 3 rule, expecting focus on domestically produced agricultural biofuels. “What we'd like to see is the EPA to acknowledge the potential for the use of RNG as a transportation fuel, listen to some of the industry estimates out there in terms of the potential for the adoption, current and incentivize growth in the cellulosic category, as is the law and mentioned in the statute.”

Does maintaining 2026 guidance imply higher production and unit profitability in the second half, and what is the confidence level?

Management confirmed expectations for production growth to ramp in the second half and stronger RIN pricing. They noted that production might trend towards the lower end of the original guide but expressed confidence in meeting the overall EBITDA guidance range due to financial discipline and other levers. “we do anticipate our production growth to continue to ramp as we move through the year. You know, RIN pricing has been a little stronger in the second half versus the first half, and we've been participating along in the markets and production may trend towards the lower end of our original production guide and feel confident that given our financial discipline and what we're doing around some of those other items that will be in the guidance range that we provided in the beginning of the year.”

What is the size of the candidate pipeline for renewable power plant conversions, and are there capex savings compared to greenfield projects?

Management identified 3-5 additional projects for potential conversion, with the next three top candidates representing over 4 million MMBtu of design capacity. They clarified that there are no particular capital cost savings from conversion, but being on-site provides valuable insight into gas collection capabilities. “We have probably three, four, five additional projects in our portfolio that we're looking at converting. I would say the next three or so that are top candidates would be over 4 million MMBtu of design capacity, and then some additional opportunities that we continue to advance could be another 1 million or 2 million on top of that.”

OPAL

OPAL Fuels (OPAL) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Industrials· Aug 10, 2026

Source: earnings call transcript

Executive summary

OPAL Fuels Q2 FY26 — Solid Financials Driven by Tax Credits and FSS Growth

OPAL Fuels delivered solid Q2 FY26 financial results, with adjusted EBITDA up 40% driven by 45Z tax credits and Fuel Station Services growth, despite RNG production being modestly below expectations. The company is focused on operational improvements for existing assets and advancing construction of new RNG projects, with 3 million MMBtu of design capacity expected online over the next 24 months, while maintaining full-year guidance. Management highlighted the long-term growth opportunity in heavy-duty transportation fuel switching to natural gas, supported by the 15-liter engine.

Highlights

Adjusted EBITDA increased 40% year-over-year to $23.1 million.
RNG production was 1.3 million MMBtu, approximately 8% higher from last year.
Fuel Station Services segment EBITDA increased to $12.5 million from $10.9 million last year.
G&A expenses were $3.2 million lower versus Q2 FY25.
Generated approximately $0.30 per share in discretionary free cash flow for the last 12 months.

Concerns

RNG production was modestly below expectations this quarter.
Renewable Power segment adjusted EBITDA decreased to $0.3 million from $2.2 million last year due to lower production and pricing.
Recorded a non-cash impairment from a renewable power project decommissioning related to the CMS RNG project.

Guidance & targets

Category	Target	Timeline	Confidence
Full-year Adjusted EBITDA	$95M-$110M high materiality	FY26	High
Annual design capacity coming online	Over 2 million MMBtu medium materiality	Next 12 months	High
Annual design capacity coming online	1 million MMBtu medium materiality	FY28	High
Total annual design capacity coming online	Approximately 3 million MMBtu high materiality	Next 24 months	High
Upstream segment growth drivers	Incremental volumes from existing assets and completion of projects in construction medium materiality	Next 12 to 24 months	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
RNG Fuel Driven by 45Z tax credits and production growth amidst flat realized RIN prices. 45Z tax credits contributionProduction growth	—	—	—	EBITDA increased to $18.6 million from $13.3 million last year
Fuel Station Services Delivered improved performance.	Contributed to consolidated revenue increase of 4% to $83.4 million	—	—	EBITDA increased to $12.5 million from $10.9 million last year
Renewable Power Performed lower compared to the prior year period, driven by lower production and pricing. Expected to see lower contributions as assets are converted into RNG plants. Included a non-cash impairment from a project decommissioning.	—	—	—	Adjusted EBITDA was $0.3 million compared to $2.2 million prior year

Deals & partnerships

GFL Development of Stone's Throw and Grady Road RNG projects

General contractor released for these projects.

Risks & headwinds

RNG production modestly below expectations Q2 FY26

1.3 million MMBtu in Q2 FY26, approximately 8% higher from last year, but below expectations

Mitigation:Focused on meaningful opportunities to grow volumes through existing facilities and drive second half results via plant improvement initiatives (e.g., gas collection, well field tuning).

Lower contributions from Renewable Power segment Q2 FY26 and ongoing

Adjusted EBITDA $0.3 million for Q2 FY26 compared to $2.2 million prior year

Mitigation:Converting renewable power assets into RNG plants; non-cash impairment from project decommissioning in connection with CMS RNG project.

Pipeline interconnection risk on new projects Near-term

Notably CMS project

Mitigation:Have backup virtual pipeline interconnections for CMS, which will be temporary and time-constrained, ensuring project timing holds.

What to watch in Q3 FY26

RNG production from existing facilities

H2 FY26

Current 1.3 million MMBtu in Q2 FY26 (modestly below expectations)

Target Increased production and improved utilization

Why it matters

Operational improvements are low-capital and high-EBITDA impact, crucial for meeting full-year guidance and future discretionary FCF growth.

While production performance was modestly below our expectations this quarter, we continue to see meaningful opportunities to grow volumes through our existing facilities and drive our second half results.

Find out whether OPAL delivers this. Inve re-checks your case every morning.

Q&A highlights

Could you elaborate on the most impactful plant improvement initiatives and quantify their potential upside in production or EBITDA?

Management detailed initiatives including operational training, improved efficiency and availability, and technology for gas collection and well field tuning. They expect 5-10% improvement on the 9 million MMBtu nameplate capacity, with most of the improvement flowing to EBITDA due to high operating leverage.

“When it comes to some of the improvements, when you think about the overall capacity that we have of 9 million MMBtu of nameplate, you add, you know, 5% or 10% improvement on those combined with the from the collection of the gas to the improved availability and efficiency, you can understand how that can really have a significant impact on future results.”

asked by Derrick Whitfield · answered by Jon Maurer

2 min read 6 chapters

Detailed narrative

Operational Improvements & Production Growth

OPAL Fuels is actively pursuing plant improvement initiatives to enhance production from existing facilities, which have a nameplate capacity of 9 million MMBtu. These efforts, including improved gas collection and well field tuning, are not capital intensive and are expected to drive 5-10% incremental production.

Management anticipates these improvements will significantly boost EBITDA due to high operating leverage, with most incremental production and revenues flowing to the bottom line.

Project Pipeline & Construction Progress

The company is advancing construction on several RNG projects. Cottonwood, Burlington, and CMS RNG projects are expected to bring over 2 million MMBtu of annual design capacity online within the next 12 months. Additionally, general contractors have been released for the Stone's Throw and Grady Road projects, which are GFL joint ventures slated to add another 1 million MMBtu of annual design capacity by 2028.

In total, these projects will contribute approximately 3 million MMBtu of new capacity over the next 24 months.

Regulatory Environment & RFS

The Renewable Fuel Standard (RFS) is viewed as a stable regulatory backdrop, similar to the Clean Air Act. OPAL Fuels highlights bipartisan support for programs like the 45Z production tax credits, which accelerate biogas capture. The company is actively engaging with the EPA to advocate for policies that support additional RNG investment and acknowledge the adoption curve for natural gas vehicles, emphasizing RNG's role in energy dominance and inflation control.

Heavy-Duty Transportation Market Opportunity

OPAL Fuels is strategically positioned to capitalize on the energy arbitrage opportunity presented by fuel switching in heavy-duty transportation. The refuse sector has already achieved a 50% adoption rate of CNG trucks for 9- and 12-liter engines. The introduction of the 15-liter natural gas engine is expected to address the largest segment of the 44 billion gallon U.S. diesel market, offering compelling economics and sustainability benefits to accelerate adoption of RNG.

Capital Allocation & Liquidity

The company maintains a disciplined capital allocation strategy, balancing investments in new RNG project development and fueling infrastructure. OPAL Fuels ended Q2 FY26 with $162.2 million in liquidity, including $91.4 million in cash, $19.3 million in available revolver capacity, and $51.6 million in undrawn preferred capital commitments.

Over the first six months of FY26, the company invested more than $52 million in RNG projects, OPAL-owned fuel stations, and finance transformation initiatives.

Renewable Power Asset Conversions

OPAL Fuels is exploring the conversion of existing renewable power assets into RNG plants. The company has identified 3-5 additional projects for potential conversion, with the next three top candidates representing over 4 million MMBtu of design capacity. While these conversions do not offer direct capital cost savings compared to greenfield projects, being on-site provides valuable insight into gas collection and potential gas capabilities.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.