Corporate Funding for Battery Storage Firms up by 64% YoY in 1H 2022

Listen to this article

Global corporate funding for battery storage, smart grid, and energy efficiency companies in the first half (1H) 2022 increased to $17 billion compared to $10.4 billion raised in 1H 2021, a 63% increase year-over-year (YoY), according to Mercom’s 1H and Q2 2022 Funding and M&A Report for Storage, Grid & Efficiency.

According to the report, the total venture capital (VC) funding for battery storage, smart grid, and energy efficiency companies declined by 20% to $3.9 billion compared to $4.9 billion raised in 1H 2021.

Energy Storage, Smart Grid, and Efficiency VC Funding 1H 2021-1H 2022

VC funding for energy storage, smart grid, and efficiency companies increased to $2.4 billion in 34 deals in Q2 2022 compared to $1.6 billion in 37 deals in Q1 2022. Funding amounts were 34% lower YoY compared to the $3.6 billion raised in 28 deals in Q2 2021.

Energy Storage, Smart Grid, and Efficiency Top VC Funded Deals in 1H 2022

Energy Storage 


According to the report, corporate funding for battery storage companies in 1H 2022 increased by 64%, with $15.8 billion raised in 57 deals compared to $9.6 billion raised in 43 deals in 1H 2021.

Corporate funding in energy storage is on track to be the highest ever in 2022. There has been a gradual shift in corporate funding from VC funding to public and debt funding as several companies have gone public over the past two years.

VC funding for battery storage companies declined by 34% in 1H 2022, with $2.9 billion in 45 deals compared to the $4.4 billion raised in 34 deals in 1H 2021.

VC funding for battery storage in 1H 2022 was spread across 16 categories, which included Li-based batteries, compressed-air energy storage, fuel cells, solid-state batteries, energy storage systems, software, thermal energy storage, supercapacitor, flywheel, materials & components, nickel-based batteries, battery management, liquid air energy storage, aluminum-sulfur batteries, service provider, and zinc-based batteries.

Also, VC funding for energy storage companies in Q2 2022 stood at $1.8 billion in 24 deals, a 55% increase compared to $1.1 billion in 21 deals in Q1 2022. The numbers marked a decrease of 48% compared to the $3.4 billion raised in 20 deals in Q2 2021.

The top five VC funding deals in 1H 2022 included $925 million raised by Eolian; $400 million raised by Group 14 Technologies; $250 million raised by Hydrostor; $215 million raised by Sunfire; and $200 million raised by Factorial Energy.

A total of 165 VC investors participated in energy storage funding in 1H 2022.

In 1H 2021, $12.8 billion was raised in 12 deals, a 146% increase compared to nine deals that brought in $5.2 billion in 1H 2021.

There were 16 announced energy storage project funding deals in 1H 2022, bringing in a combined $3.8 billion compared to $1.2 billion in six deals in 1H 2021.

Also, in 1H 2022, there were a total of 13 (six disclosed) energy storage M&A transactions compared to nine transactions (two undisclosed) in 1H 2021.

Smart Grid 

The report states that VC funding in smart grid in 1H 2022 was 58% higher YoY, with $731 million raised in 20 deals compared to $463 million raised in 17 deals in 1H 2021.

In Q2 2022, VC funding for Smart Grid stood at $419 million in eight deals compared to $176 million in seven deals in Q2 2021.

Some of the top VC funding deals for Smart Grid companies in 1H 2022 included Arcadia raised $200 million raised by Arcadia; $125 million raised by FreeWireTechnologies; $100 million raised by Tibber raised; $90 million raised by Span; and $40 million raised by GridX.

In 1H 2022, $307 million was raised in four debt and public market financing deals compared to $8 million in one deal in 1H 2021.

In the first half of 2022, there were 10 M&A transactions (two disclosed) compared to 11 transactions (all undisclosed) in 1H 2021.

Efficiency 

In 1H 2022, $269 million of VC funding was raised in six deals compared to $5 million raised in two deals in 1H 2021.

In Q2 2022, $160 million was raised in two energy efficiency VC funding deals compared to $109 million in four deals in Q1 2022. In a YoY comparison, an undisclosed amount was raised in one deal in Q2 2021.

There were no debt or public market financing deals for energy efficiency technology companies in 1H 2022. In 1H 2021, $343 million was raised in one deal.

In 1H 2022, there were no M&A transactions. In 1H 2021, there was one disclosed transaction worth $300 million.

To get a copy of the report, visit: https://mercomcapital.com/product/1h-q2-2022-funding-ma-report-for-storage-grid-efficiency