Total corporate funding in energy storage, including from venture capital (VC), public market, and debt financing, amounted to $2.2 billion in 27 deals in the first quarter (Q1) of 2023, a drop of 83% year-over-year (YoY) compared to $12.9 billion raised in 27 deals, according to Mercom’s Q1 2023 Energy Storage & Smart Grid Funding and M&A Report.

The report noted that LG Energy Solution’s $10.7 billion IPO during the quarter contributed 83% of Q1 2022 funding and skewed funding totals.

On a quarter-over-quarter (QoQ) basis, funding significantly decreased by 49% compared to $4.3 billion raised in 31 deals.

Energy storage companies saw a decline in VC funding (including private equity and corporate venture capital) in Q1 2023, both YoY and QoQ.

A total of $1.1 billion was raised in 19 VC deals in the first quarter of the year, an 8% drop YoY compared to $1.2 billion raised in 22 deals and a 35% drop in QoQ compared to $1.7 billion raised in 22 deals.

Electriq Power and Our Next Energy topped the list with the highest venture capital funding at $300 million each. The other top-funded companies were WeView with $87 million; NanoGraf with $65 million; and Caban Systems with $51 million.

The first quarter of 2023 saw a sharp decline in the announced debt and public market financing for energy storage technologies. Eight deals worth $1.1 billion were closed, compared to nine deals worth $2.6 billion in the previous quarter.

Announced Energy Storage project funding came in at $2 billion in nine deals, compared to $749 million raised in seven deals in Q4 2022.

There were four M&A transactions involving energy storage companies in Q1 2023, compared to five in Q4 2022 and five in Q1 2022.

There were 12 energy storage project M&A transactions in Q1 2023.

Smart Grid

In Q1 2023, corporate funding in the smart grid amounted to $1.1 billion, generated through 18 deals. This represents a 42% decrease from the previous quarter, where 23 deals secured a total funding of $1.9 billion. In a YoY comparison, financing in Q1 2023 increased by 230% compared to $331 million in 15 deals in Q1 2022.

There was a 66% decrease QoQ for Smart Grid VC funding in Q1 2023, with $280 million raised in 14 deals compared to $846 million in 15 deals. In a YoY comparison, funding in Q1 2023 was 14% lower compared to the $327 million raised in 13 deals.

EO Charging topped the list with the highest venture capital funding at $80 million. The other top-funded companies were CHARGE+ZONE with $54 million; Magenta Mobility with $40 million; ConnectDER with $27 million, and Indra with $21 million.

Smart Grid companies secured $777 million through four debt and public market financing deals this quarter, compared to eight public market financing deals totaling $1.1 billion in the preceding quarter.

There were four M&A transactions in Q1 2023, compared to two in Q4 2022 and three in Q1 2022.

The 88-page report covers companies and investors and includes charts, tables, and graphs.

To learn more about Mercom’s Q1 2023 Energy Storage & Smart Grid Funding and M&A Report, visit: https://mercomcapital.com/product/q1-2023-funding-ma-report-storage-grid