Chamath Palihapitiya-backed Arclight Clean Transition Corp. jumps 12% after announcing Maryland school-bus deal

• Arclight Clean Transition Corp's stock skyrocketed as much as 12% on Wednesday.
• The move came after the company's merger partner, Proterra, inked a deal with Montgomery County to provide its battery technology for school buses.
• The 16-year deal is reportedly worth $169 million and involves the lease of 326 buses.

Arclight Clean Transition Corp. stock jumped as much as 12% on Wednesday after the company announced its merger partner Proterra inked a deal with the Board of Education in Maryland's Montgomery County.

According to a report from Bloomberg, Proterra will provide its electric battery technology for school buses as a part of a $169 million deal with the county.

Montgomery officials plan to replace their entire 1,422 diesel bus fleet with EVs over the next two decades.

Wednesday's contract is the first step toward that goal. The deal involves the lease of 326 buses to the county over the next 16 years. The vehicles will be built by Thomas Built Buses, a division of Daimler AG, but will use battery technology from Proterra.

Proterra had already sold four electric buses to Montgomery county for use as public transport.

The Chamath Palihapitiya-backed SPAC Arclight Clean Transition Corp. merged with Proterra in a transaction the billionaire investor called his "biggest investment in climate change" on Jan. 12.

Palihapitiya tweeted about the recent school bus contract win, calling it a "huge deal" for Proterra and his SPAC.

The transportation director of Montgomery County Public Schools said the contract will also be the first electric school bus agreement in the nation that isn't federally funded.

And it will make the county a leader in the electrification of school buses nationwide.

Montgomery officials also estimate the costs of the electric buses will be in line with what they would have spent on diesel school buses.

"It costs no more than what districts are spending on diesel," Montgomery's transportation director told Bloomberg. "We think there's going to be savings initially on fuel and maintenance. The price of electric buses will fall and the price of diesel buses is going to rise to the point that they meet. And, eventually, you won't be able to get a diesel bus."

"We know exactly where they are going to be overnight and we know how far they're going to go. It's sort of the perfect vehicle to electrify," the director added.

The deal represents another positive step for Proterra as the company looks to take advantage of a potential green energy investment wave from the Biden Administration.

Recently, Proterra has been involved in several key deals including:

• A collaboration with Komatsu on battery systems for electric construction equipment.
• Harvard's acquisition of four 35-foot electric buses to help curb emissions on its campus.
• A deal with the Stockholm-based, UK electric bus operator Volta Trucks to supply battery technology.

Arclight Clean Transition Corp. stock was up 6.48% as of 12:30 p.m. ET on Wednesday.