Rented by an Oil & Gas Producer, Industrial Agricultural and Industrial Plastic Company
VAN NUYS, CA / ACCESSWIRE / June 23, 2021 / Capstone Green Energy Corporation(www.CapstoneGreenEnergy.com) (NASDAQ:CGRN) formerly Capstone Turbine Corporation (www.capstoneturbine.com) (NASDAQ:CPST) ("Capstone" or the "Company"), announced today that it continues to expand its long-term microturbine rental business as part of its growing Energy as a Service (EaaS) business model, with an additional 1.1 megawatt (MW) of new long-term rental contracts. As a result, Capstone also announced today that it has expanded its low emission microturbine rental fleet from 10.6 MW to 12.1 MW.
The first of the new long-term rental contracts is a five-year rental agreement for a new C200 Signature Series slated for a local independent oil and gas producer focused on mature field revitalization, acquisitions, and exploration. The company optimizes and develops existing and acquired assets, and also implements thermal enhanced oil recovery and other technologies to expand existing oil production. This contract was secured by Capstone's local distribution partner, Cal Microturbine, Capstone's exclusive distributor for California, Hawaii, and Nevada and nonexclusive for Oregon and Washington (www.calmicroturbine.com).
The second long-term rental contract is a minimum five-month rental contract for a C800S for a new industrial agricultural operation. This rental agreement was secured by Capstone's new Direct Solutions Sales organization. The five-month rental was pre-paid and was commissioned in mid-June.
The third rental contract is a one-year rental of a C65 for an industrial plastic company looking to utilize waste gas from a plastic recycling process. "If the C65 rental system operates satisfactorily on this off-spec gas, the customer has additional gas it's not using at multiple other locations," stated Jim Crouse, Capstone Green Energy, Chief Revenue Officer. "The rental program offers a unique and efficient method to test customer's off-spec fuels that will allow us to determine applicability and durability in a fraction of the time it's taken us in the past," added Mr. Crouse.
Like Capstone Green Energy, all three customers are committed to health, safety, and environmental excellence. Leveraging Capstone Green Energy's innovative microturbine technology will help all three companies save money and reduce their carbon footprint.
"Expanding Capstone's Energy as a Service business, which includes the long-term rental program, is an important element for the Company achieving its strategic goals. Capstone is an eminent green energy company, having focused for a long time on transforming the way businesses think about on-site energy production," said Darren Jamison, President and Chief Executive Officer of Capstone Green Energy.
"Growing our rental fleet is a key part of the business plan that we developed in conjunction with amending the Goldman Sachs Note Purchase Agreement on October 1, 2020, which includes the strategic expansion of the long-term rental fleet from 8.6 MW to 21.1 MW by March 2022," said Eric Hencken, Chief Financial Officer of Capstone Green Energy. "Long-term rentals are a key to our future financial success as the recurring revenue stream they generate improves our gross margin and expense absorption," concluded Mr. Hencken.