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Total corporate funding in the solar sector in the third quarter of FY22 stood at $18.7 billion, 18 per cent lower compared to $22.8 billion in the same period last year, according to a report by Mercom Capital Group.
The global clean energy communications and consulting firm released its report on funding and merger and acquisition (M&A) activity for the solar sector in the third quarter (Q3) of 2022.
Raj Prabhu, CEO of Mercom Capital Group, said, “Corporate funding during this period is behind the pace on a year-on-year (y-o-y) basis because of factors such as inflation and high-interest rates but is ahead compared to the previous six years. We have seen a resurgence in venture capital and private equity funding, breaking funding records since 2010.”
Prabhu added, “There is no longer any doubt about the growth potential of the solar industry — it is now a race to acquire the right technology and portfolios to scale.”
Mercom Capital Group’s latest report finds that the number of deals increased from 17 per cent on a year-on-year (YoY) basis to 131 compared to 112 deals last year. In Q3 of FY22, venture capital (VC) funding activity went up 150 per cent to $5.5 billion in 72 deals compared to the $2.2 billion raised in 39 deals in the nine months of 2021.
Top VC deals
The top VC deals include $750 million raised by Intersect Power, $500 million raised by Longroad Energy, $375 million raised by Palmetto, $360 million by Gokin Solar, $350 million raised by Agilitas Energy, $260 million raised by Sun King.
Solar public market financing came to $4.9 billion in 11 deals, down by 22 per cent compared to $6.3 billion in 23 deals in the same period of 2021. Even the solar debt financing activity was down by 42 per cent to $8.3 billion in 48 deals, compared to a year before which was $14.2 billion raised in 50 deals.
Securitisation deals saw a drop of 28 per cent to $2.3 billion, compared to $3.2 billion in 11 deals last year. During this time, there were a total of 90 solar mergers and acquisition (M&A) transactions compared to 83 transactions last year.
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