Total global corporate funding into the solar sector, including venture capital/private equity (VC), debt financing, and public market financing raised came to $12.8 billion in 2017, a 41 percent increase compared to the $9.1 billion raised in 2016.
»A strong fourth quarter pushed overall funding higher in 2017,« says consultancy Mercom Capital Group, LLC. According to the company’s annual report on funding and merger and acquisition (M&A) activity for the solar sector in 2017, global VC investments came to $1.6 billion in 99 deals in 2017, up 30 percent from the $1.3 billion raised by 78 deals in 2016 – led by several large private equity deals in India. Solar downstream companies accounted for 85 percent of total VC funding in 2017, bringing in $1.4 billion of the total $1.6 billion raised.
Thin-film companies brought in $106 million while service providers raised $47 million. Investments in PV technology companies came to $40 million and Balance of Systems (BoS) companies raised $36 million. The concentrated solar power (CSP) category raised $8 million and the concentrator photovoltaics (CPV) category received $6 million. Overall, five of the top six solar VC funding deals in 2017 came from India, says Mercom.
Public market financing was flat in 2017 to $1.7 billion raised in 33 deals from $1.8 billion raised in 27 deals in 2016. Three IPOs were logged during the year that raised a combined total of $363 million for Canadian Solar Infrastructure Fund, New Energy Solar Fund, and Clenergy.
Furthermore, large-scale project funding announced in 2017 reached a $14 billion raised in 167 deals, compared to $9.4 billion raised in 133 deals during 2016. The top investors in large-scale projects included Clean Energy Finance Corporation (CEFC), followed by Santander, Commonwealth Bank of Australia and Siemens Financial Services.
According to the findings of Mercom, there were 71 corporate M&A transactions in the solar sector in 2017, up slightly from 68 transactions recorded in 2016. Solar downstream companies were involved in 51 of these transactions. Engie acquired three companies while BayWa, Brookfield Asset Management, Horizon Solar Power, Siva Power, Solar Spectrum, and Sonnedix acquired two companies each. The largest transaction in 2017 was the $1.6 billion acquisition of FTP Power (sPower) by AES and Alberta Investment Management (AIMCo) from Fir Tree Partners.
Project acquisitions jumped up 67 percent as a record 228 large-scale solar projects with a combined capacity of more than 20.4 GW were acquired in 2017, compared to 2016 when 12.2 GW changed hands in 218 transactions.