Solar corporate funding increased globally by 24% in 2020 (Year-over-Year)


Funding in Solar Sector Increased 24% with $14.5 Billion in 2020 (Year-over-Year)

Mercom Capital Group, llc, published its annual report on funding and merger and acquisition (M&A) activity for the solar sector in 2020. Total corporate funding into the solar sector globally, including venture capital (VC), private equity (PE), debt financing, and public market financing, came to $14.5 billion, a 24 % increase compared to the $11.7 billion raised in 2019.
According to Raj Prabhu, CEO of Mercom Capital Group, recovery has been swift and broad, following a tough first half when corporate funding was down 25 percent year-over-year,

Global venture capital and private equity (VC/PE) funding in the solar sector in 2020 came to $1.2 billion in 41 deals, compared to $1.4 billion in 53 deals in 2019.

Of the $1.2 billion in VC/PE funding raised in 41 deals in 2020

  • $1.1 billion went to 27 solar downstream companies, which accounted for 90 % of total VC funding in 2020;
  •  Solar service providers raised $61 million;
  • PV companies raised $17 million;
  • Thin-Film (TF) technology companies raised $15 million;
  • and concentrator photovoltaics (CPV) companies raised $5.5 million.

The top VC funded companies in 2020 were Ayana Renewable Power, which raised $390 million, Silicon Ranch Corporation, which brought in $225 million, Brighte ($76 million), Sunseap Group ($72 million) and Aurora Solar and Zero Mass Water (each $50 million). According to the Mercom Capital Group company, there were 102 VC and PE investors that participated in funding deals in 2020, with five involved in multiple rounds.

Public market financing was up 101 percent, with $5.1 billion in 2020. Array Technologies raised $1.2 billion in its initial public offering (IPO) in the fourth quarter of 2020.

The top investors in large-scale projects in Q4 2020 were:

  • Societe Generale (invested in five projects);
  • Sumitomo Mitsui Banking Corporation (invested in four projects).
  • Credit Agricole (invested in three projects);
  • European Bank for Reconstruction and Development (EBRD) – (invested in 3 projects):
  • IDB Invest) (Inter-American Investment Corporation) (invested in three projects).

In total, 62 merger and acquisition (M&A) deals were transacted in the solar sector in 2020 (compared to 65 in 2019). The majority of the transactions involved solar downstream companies. The largest transaction in 2020 was Sunrun’s acquisition of Vivint Solar, in an all-stock transaction for $3.2 billion.
Last but not least, there were 231 large-scale solar project acquisitions in 2020 (compared to 192 transactions in 2019). According to Mercom Capital Group, a record 39.5 GW of large-scale solar projects changed hands in 2020 (compared to 26.1 GW in 2019). This was the largest volume of projects acquired in a single year to date, concludes Mercom.