Corporate funding in global solar energy grows 43% in September quarter

Solar energy financing activities are rebounding globally since COVID-19 disruptions, as the total corporate funding came to $3.2 billion in the third quarter of 2020, from the $2.3 billion in the second quarter of the year, a growth of 43 per cent.

The funding recorded a growth of 8 per cent year-over-year (YoY) compared to the same quarter last year. However, total global corporate funding, including venture capital, private equity, public market, and debt financing, in the solar sector comes to $7.9 billion in the first nine months of the year, 13 per cent lower than the $9 billion in the first nine months of 2019,  said data from Mercom Capital Group, a global clean energy consulting firm.

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Major India-related solar deals so far in 2020 were UK-based investor Actis's acquisition of two solar projects with 400 MW from ACME Solar for $334 million, RattanIndia Group's sale of its solar business to infrastructure investment fund Global Infrastructure Partners (GIP) for Rs 1,670 crore, Malaysia-based Yinson Renewables acquiring  57.5 per cent equity interest in Rising Sun Energy (RSE) with two operational solar projects in the Bhadla Solar Park in Rajasthan for $14.66 million, Amplus, the Indian arm of Petronas acquiring a 100 MW of solar projects from ACME Solar for $109 million, Ayana Renewable Power, backed by the UK-based CDC Group, acquiring  First Solar's two solar projects with a capacity of 40 MW and UK-based NextEnergy Capital Group acquiring a 27.4 MW solar project in Odisha from IBC Solar Energy.

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The global venture capital funding was $183 million in 15 deals in the third quarter, compared to $65 million in five deals in the previous quarter of the year, a jump of 182 per cent. However, VC funding during the nine months of the year was 61 per cent lower with $394 million, compared to $1 billion raised in the first nine months (9M) of 2019. The top VC deals in 9M 2020 were - $72 million raised by Sunseap Group, $50 million raised by Zero Mass Water, $40 million raised by Ecoppia, $37 million raised by Sunseap Group in a separate deal, and $35 million raised by Lumos.

About 42 corporate solar M&A transactions (11 disclosed for $7 billion) were announced in the nine months of 2020, compared to 57 transactions (10 disclosed for $600 million) in 9M 2019. The largest M&A transaction in 9M 2020 was Sunrun's acquisition of Vivint Solar, in an all-stock transaction for $3.2 billion. Even with COVID-19 disruptions, project acquisition activity was up 52 per cent in 9M 2020, with 24.3 GW of solar projects acquired, compared to 16 GW acquired in the same period last year.

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