Aemetis projects revenues of $1.95 billion in 2028 under new 5-year plan

Aemetis Inc. announced Feb. 20 an updated five-year plan that projects the company will generate $1.95 billion in revenues and $645 million of adjusted EBITDA in year 2028. 

The new plan states revenues are expected to grow at a compound annual growth rate of 38 percent, and adjusted EBITDA is expected to grow at a projected compound annual growth rate of 83 percent for the years 2024 to 2028.

A presentation summarizing the updated five-year plan is available for review here.

In the plan, the company’s revenue and adjusted EBITDA growth is expected from:

• 75 dairies producing renewable natural gas (RNG) by 2028.

• A 90-million-gallon-per-year (mgy) sustainable aviation fuel (SAF) and renewable diesel plant in Riverbank, California.

• A CO2 carbon sequestration and underground storage (CCUS) well located near the Riverbank and Keyes biofuels plant sites in California.

• The completion of solar, mechanical vapor recompression (MVR) and other energy-efficiency, carbon-emission reduction and electrification projects at its Keyes biofuels plant.

• The continued expansion of biodiesel and tallow refining production at the Aemetis plant in India.

The presentation also describes the tax credits expected to be received by Aemetis from the Inflation Reduction Act for its renewable fuel and sequestration projects.

“Through the expansion of our RNG, biodiesel, SAF/renewable diesel, CCUS and ethanol businesses, Aemetis is poised to rapidly grow revenue to almost $2 billion by the end of 2028,” said Eric McAfee, chairman and CEO of Aemetis. “Additionally, Aemetis closed $50 million of new USDA funding and received $55 million from the sale of IRA tax credits in the past year. With strong financing support from the USDA for renewable fuels projects, the passage of the $380 billion Inflation Reduction Act to provide funding to renewable energy projects, and EPA approval allowing 15 percent ethanol blends in 49 states—which expands the ethanol market by almost 50—the regulatory and financial climate for renewable energy projects continues to support our overall growth plan.”

Significant milestones were achieved in the past year under the previous five-year plan, including:

• The transition to receiving revenue and positive operational cash flow from the biogas-to-RNG upgrading facility and dairy digesters.

• Receiving the use permit and CEQA approval for the SAF/renewable diesel plant at the Riverbank site.

• Receiving the first private carbon-sequestration characterization well-drilling permit issued by the state of California.

• Completing construction and commissioning of the 1.9 megawatt solar microgrid with battery backup.

• Installing an Allen Bradley distributed control system with AI capabilities to optimize energy use and other operational performance of the Keyes ethanol plant.

• Completing design engineering and now procuring equipment for the MVR unit at the Keyes plant to utilize low carbon-intensity electricity instead of fossil natural gas.

• Completing deliveries of biodiesel to the oil-marketing companies (OMCs) in India under the first $40 million of contracts.

• Receiving awards for an additional $150 million of allocations from the three OMCs in India to be fulfilled using a cost-plus pricing formula.

Due to uncertainties regarding timing, the new five-year plan does not include several other growth initiatives that are actively under development at Aemetis, including revenues and EBITDA from the planned operation of the 50 mgy debt-free India refined-tallow plant. 

The export of tallow from India to North America customers at approximately $4 to $5 per gallon for 50 mgy, increasing revenues by up to $250 million per year, is excluded. 

The 2024 plan projections include using the refined tallow from India as a feedstock supply source for the operations of the SAF/renewable diesel plant under development in California to improve profit margins.

In addition to the $55 million received in Q4 2024 from the sale of transferable tax credits, the Inflation Reduction Act is expected to provide transferable investment and production tax credits to Aemetis related to its U.S. renewable fuels and CO2-sequestration projects, which are included in the 2024 plan.

The five-year plan for Aemetis Dairy RNG operations projects revenues will grow from $18 million in 2024 to $190 million in 2028, while Dairy RNG project EBITDA is expected to expand from $7 million in 2024 to $123 million in 2028.

The RNG plan accounts for the delays in receiving LCFS revenue that are caused by the current regulatory process to obtain LCFS pathway approvals for each dairy digester that may be shortened if pending regulatory changes are adopted by the California Air Resources Board.

The five-year plan projects that the Aemetis SAF/renewable diesel plant will provide revenue of $672 million with adjusted EBITDA of $195 million in year 2027 from the 90 mgy facility that received the use permit and CEQA approval in September 2023 to be built at the 125-acre Riverbank Industrial Complex, which has 100 percent renewable hydroelectricity; a rail line and storage for 120 railcars; 710,000 square feet of buildings; and 50 acres of developable industrial land.

In connection with the carbon-reduction upgrades at the Keyes plant, expansions of the India biodiesel plant, and expanded market opportunities resulting from changes to governmental policies, the five-year plan projects that the company will generate annual revenue from ethanol and biodiesel of approximately $826 million in 2028, up from $368 million of expected revenue in 2024.