Gevo Stock Rises After Carbon Credit Sale Deal With Future Energy Global, Retail’s Bullish
Synopsis
The agreement would enable Gevo’s financing for the ATJ-60 facility at Lake Preston, South Dakota.
Biofuel maker Gevo's (GEVO) stock gained 6.9% on Wednesday after the company agreed to sell carbon credits to Future Energy Global (FEG), a fintech firm focused on sustainable aviation fuel (SAF).
Under the multi-year agreement, FEG will buy Scope 1 and Scope 3 emissions credits from 10 million gallons per year of fuel produced at Gevo’s alcohol-to-jet (ATJ) SAF production facility, Gevo ATJ-60.
The Dublin-based FEG’s customers include airlines and other companies looking to reduce emissions through SAF. The agreement has an option for the company to increase the off-take later.
The agreement would enable Gevo’s financing for the ATJ-60 facility at Lake Preston, South Dakota. Gevo secured a conditional loan commitment of $1.63 billion (including capitalized interest during construction) from the U.S. Department of Energy’s (DOE) Loan Programs Office during the Biden administration.
Gevo's proprietary plant design is expected to produce 60 million gallons of SAF annually.
“We’re impressed with Gevo’s pipeline, which combines technology ready for today’s market and additional technologies far along in development that could increase production efficiency and accelerate the trajectory of SAF scaling,” said the CEO of FEG, Natasha Mann.
Despite being viewed as a key pathway towards net-zero emissions for the airline industry, sustainable fuel production accounted for 0.3% of global jet fuel consumption.
Retail sentiment on Stocktwits moved higher into the ‘bullish’ (68/100) territory than a day ago, while retail chatter was ‘high.’
One retail trader said the deal could be what everyone was waiting for.
Broader markets also jumped on Wednesday after U.S. President Donald Trump paused the reciprocal tariffs imposed on a host of countries for 90 days.
Gevo shares have fallen 47.3% year-to-date (YTD).
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