Corporate funding in solar energy down 41% at $1.7 bn in April-June

NEW DELHI: Mercom Capital Group today said corporate funding into the solar sector in April-June quarter fell to $ 1.7 billion, a 41 per cent drop compared to the $ 2.8 billion raised in Jan-March period of 2016.

Mercom Capital Group, LLC, a 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 second quarter of 2016.

Total corporate funding, including  including venture capital funding, public market and debt financing into the solar sector in Q2 2016 fell to $ 1.7 billion this quarter, a 41 per cent drop compared to the $ 2.8 billion raised in Q1 2016, it said.

Mercom Capital further said that the year-over-year total corporate funding was down significantly compared to $ 5.9 billion in the second quarter (April-June) of last year.

“The solar industry continues to experience weakness in terms of financing activity, and corporate funding in Q2 2016 was at its lowest level in three years,” CEO and Co-Founder of Mercom Capital Group Raj Prabhu said in a statement.

Global solar VC funding (including private equity) saw a large decline this quarter with $ 174 million in 16 deals compared to $ 406 million in 23 deals in Q1 2016.

Year-over-year (YoY) VC numbers were slightly better compared to Q2 2015 with $ 142 million in 24 deals.

Solar downstream companies raised the most (64 per cent) VC funding in Q2 2016 with $ 112 million in seven deals. A large part of the total came from the $ 100 million raised by Silicon Ranch from private equity firm Partners Group.

Other VC deals this quarter included the $ 20 million raised by Tigo Energy, 1366 Technologies’ $ 15 million raise, and the $ 12.5 million raised by Sol Voltaics. A total of 21 VC investors participated in funding deals.

Solar public market financing in Q2 2016 came to $ 179 million in four deals compared to $ 94 million in four deals in the first quarter of 2016 and $ 2.3 billion in 12 deals in Q2 2015.

According to the report, Tata Power Renewable Energy (TPREL), a Tata Power subsidiary and a renewable energy project developer, acquired Welspun Renewables Energy’s (WREPL) 1,140 MW renewable energy project pipeline for $ 1.38 billion.

CLP India, a subsidiary of Hong Kong based CLP Group, bought a 49 per cent stake in Suzlon Energy’s 100 MW solar project in Veltoor, Telangana, with an option of acquiring the 51 per cent stake balance in the future.

Amplus Energy Solutions (Amplus Solar), an Indian solar installer and a portfolio company of I Squared Capital, acquired SunEdison’s 7 MW rooftop solar project portfolio in India.The projects are spread across the states of Maharashtra, Karnataka, Tamil Nadu and Delhi.

Source : Economic times, 11th July 2016,