Gevo monetises IRA credits to advance SAF, other initiatives

Gevo has announced the sale of approximately $20m in investment tax credits generated by its Gevo NW Iowa RNG facility to fund strategic growth projects, including sustainable aviation fuels (SAF) and other clean energy initiatives.

“We continue to seek out ways to unlock shareholder value from our operations,” said Dr. Patrick Gruber, CEO, Gevo. “This is just one example of how our mission to optimise renewable energy and seek out efficiencies creates opportunities.”

The company said that, credits, secured under the Inflation Reduction Act, have been sold to an undisclosed corporate buyer for net cash proceeds of approximately $17m.

The Gevo RNG facility produces renewable natural gas (RNG) by capturing and refining biogas from dairy farm manure. This RNG is then used as a transportation fuel, reducing greenhouse gas emissions.

The company expects to further increase RNG production over time and may also benefit from additional tax credits under the IRA.

The sale of ITCs provides Gevo with a significant cash infusion. Gevo said the IRA provisions for transferring tax credits have created a new opportunity for companies to monetise their clean energy investments.

Gevo Corporation (NASDAQ: GEVO) saw its stock price soar by 30.1% on Tuesday (September 17th, 2024), reaching a new 52-week high of $1.83 fuelled by a newly awarded U.S. patent and the announcement of a $210m acquisition of a carbon capture and sequestration equipped ethanol plant in North Dakota.

The company had recently faced the threat of delisting from Nasdaq due to its share price falling below $1 for an extended period.

However, with the recent positive developments, Gevo is now likely to avoid a reverse stock split to meet the exchange’s minimum bid requirement.