Total corporate funding (including venture capital funding, public market, and debt financing) for the battery storage, smart grid, and energy efficiency sectors in 2020 was up 112% at $8.1 billion in 2020 from $3.8 billion in the previous year, according to Mercom Capital Group’s latest report.
Meanwhile, global venture capital (VC) funding (venture capital, private equity, and corporate venture capital) for battery storage, smart grid, and efficiency companies rose 12% in 2020 and stood at $2.6 billion, compared to $2.3 billion in 2019.
Mercom’s latest report showed that total corporate funding in the battery storage sector was up 136% at $6.6 billion raised through 54 deals in 2020. VC funding in the sector in 2020 slipped during the year to $1.5 billion through 32 deals compared to the previous year, which saw $1.7 billion through 32 deals.
The report also showed that 105 VC investors participated in battery storage deals in 2020 compared to just 78 in 2019. Breakthrough Energy Ventures was the top investor in 2020.
Lithium-ion battery technology companies received $649 million in VC funding during the year, the most across company categories. According to the report, the top VC funded companies in 2020 were: Northvolt with $600 million; QuantumScape with $200 million; Zenobe Energy with $198 million; ProLogium Technology with $100 million; and Form Energy with $76 million.
In 2020, battery storage companies announced the highest debt financing since 2014 at $5 billion through 22 deals, up significantly from $1.1 billion through ten deals in 2019. Northvolt’s $1.6 billion and Plug Power’s $1 billion loans were the largest public market financing deals during the year.
There were 19 mergers and acquisition (M&A) deals within the battery storage companies during the year. Overall, 24 battery storage and storage-plus-solar deals M&A transactions were announced in 2020, up from 11 the year before.
Smart grid companies raised $748 million in VC funding through 38 deals in 2020. This was a 149% increase from 2019 when $300 million was raised through the same number of deals. Total corporate funding, including debt and public market financing, stood at $758 million through 41 deals compared to $372 million through 41 deals in 2019.
Some of the top VC funded companies in the year included ChargePoint, which brought in $127 million; Star Charge, which received $125 million; Tibber, which secured $65 million; SmartRent with $60 million; and Probus Smart Things with $53 million, according to the report.
The report showed that 102 investors funded smart grid companies in 2020, up from 78 in 2019. Some of the top VC investors in this segment during the year included Congruent Ventures, Energy Impact Partners, National Grid Partners, and Silicon Valley Bank.
Smart charging companies received the most in VC funding during the year with $324 million through 13 deals. Smart grid communications companies raised $119 million through six deals, while demand response companies raised $104 million through three deals. The sector saw a total of 21 M&A transactions during the year, compared to 29 in 2019.
Energy efficiency companies raised $291 million in VC funding through 16 deals during the year. This was a slight decline compared to $298 million through nine deals in 2019. Meanwhile, total corporate funding, including debt and public market financing, reached $791 million in 2020 compared to $670 million in 2019.
Some of the top VC funded companies in 2020 included Redaptive, which raised $157 million; followed by Palmetto with $29 million; Juganu with $18 million; Infogrid with $16 million; and Eta Compute with $13 million.
The year saw participation from 52 investors, up from just 38 in 2019. Evergy Ventures was the most active investor in 2020. Energy efficiency companies announced one deal worth $500 million in 2020, compared to $371 million through three deals in 2019.
M&A activity in the energy efficiency segment slowed down with only four transactions during the year compared to 2019, which saw nine transactions.
Mercom Capital Group also released its 2020 Q4 and Annual Solar Funding and M&A Report, which showed that global corporate funding into the solar sector (including VC, private equity, debt financing, and public market financing) increased 24% to $14.5 billion in 2020 from $11.7 billion in 2019. The report covered 375 companies and investors from around the world.
Read more funding and M&A news in our weekly funding roundup here.
Nithin Thomas is a staff reporter at Mercom India. Previously with Reuters News, he has covered oil, metals and agricultural commodity markets across global markets. He has also covered refinery and pipeline explosions, oil and gas leaks, Atlantic region hurricane developments, and other natural disasters. Nithin holds a Masters Degree in Applied Economics from Christ University, Bangalore and a Bachelor’s Degree in Commerce from Loyola College, Chennai. More articles from Nithin.