Global solar corp funding jumps 41% y/y in 2017 - Mercom

Azure Power Solar Power Plant (Photo: Business Wire)

January 8 (Renewables Now) - Total global corporate funding into the solar sector jumped by 41% year-on-year to USD 12.8 million (EUR 10.7m) in 2017, according to the latest report by Mercom Capital Group LLC.

The total figure takes into consideration venture capital (VC) and private equity (PE), debt and public market financing.

“Higher installation levels around the world, the lack of threat to the solar investment tax credit, lower than expected tariff recommendation by U.S. ITC, strong debt financing activity, and over a billion dollars in securitization deals helped the solar industry have a much better year in terms of financial activity compared to 2016,” said Raj Prabhu, CEO and co-founder of Mercom. Prabhu, though, noted that the positive trend in the sector could change if US president Donald Trump decides to impose higher tariffs in the trade case.

There were 99 global VC investments in 2017 that brought the total amount in this segment up 30% to USD 1.6 billion. Solar downstream companies accounted for USD 1.4 billion, or 85% of total VC financing last year.

The top VC/PE deals in 2017 are included in the table below.

Company Country Amount (in USD) Investors
Lightsource Renewable Energy UK 200m BP
ReNew Power India 200m Canada Pension Plan Investment Board
ReNew Power India 200m JERA
Greenko Energy Holdings India 155m GIC, ADIA
Hero Future Energies India 125m IFC
CleanMax Solar India 100m Warburg Pincus

Announced debt financing in 2017 soared to USD 9.5 billion from USD 6 billion, with six securitisation deals totaling USD 1.3 billion.

Public market financing was a bit lower at USD 1.7 billion compared to USD 1.8 billion in 2016. Three initial public offerings (IPOs) raised a total of USD 363 million for Canadian Solar Infrastructure Fund, New Energy Solar Fund and Clenergy.

Large-scale project funding announced in 2017 rose to USD 14 billion from USD 9.4 billion in 2016, with 161 investors financing some 20.5 GW of large-scale solar projects last year. In 2016, 153 investors funded 5.9 GW. The Clean Energy Finance Corporation (CEFC) was the top investor in 2017, having supported 13 projects.

Over a dozen residential and commercial solar project funds raised a total of USD 2.4 billion in 2017, while in the prior year 30 funds raised USD 4.9 billion.

In 2017, 71 corporate merger and acquisition (M&A) transactions were executed in the solar sector compared to 68 in the prior year. Solar downstream companies were involved in 51 of them. AES Corp (NYSE:AES) and Alberta Investment Management (AIMCo) acquired FTP Power, sPower, for USD 1.6 billion. This was the largest M&A transaction last year.

A record 228 large-scale solar projects with a combined capacity surpassing 20.4 GW were acquired in 2017, compared to 12.2 GW in 218 transactions in the previous year.

(USD 1.0 = EUR 0.835)

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Ivan is the mergers and acquisitions expert in Renewables Now with a passion for big deals and ambitious capacity plans.

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