Pandemic drags down H1 corp solar funding to USD 4.5bn

Global corporate solar funding in the first half of 2020 contracted by 25% year-on-year to USD 4.5 billion (EUR 3.99bn), mainly due to the turmoil caused by the COVID-19 pandemic, Mercom Capital Group says in a new report.

The clean energy consultancy released data on funding and merger and acquisition (M&A) activity in the solar sector on Thursday. The global total includes venture capital (VC) and private equity (PE) funding, public market and debt financing.

"Financial activity in the first half of the year reflects the realities on the ground. Even though solar stocks have performed well, and corporate funding in Q2 looked slightly better because of several securitization deals, global economies and solar activity are still far from being back to where they should be,” said Mercom’s CEO Raj Prabhu.

The table below gives more details on funding activity based on Mercom’s report.

A total of 23 investors were active on the VC/PE scene in the six months. Among the top deals were the USD-72-million investment of Thailand’s Banpu PCL (BKK:BANPU) into Singaporean clean energy provider Sunseap Group Pte Ltd, and the USD-50-million raising by Zero Mass Water.

Four solar securitisation deals were registered in January-June totalling USD 1.06 billion. This brought the cumulative value of those deals since 2013 to USD 6.3 billion.

M&A activity

Mercom reported 25 solar corporate M&A transactions for the first half of 2020, down from 37 deals in the year-ago period. The biggest one was the divestment of Brookfield Renewable Partners LP’s (NYSE:BEP) Thai solar business, which was sold to PTT Public Company’s power and energy arm for USD 100 million.

About 14.7 GW of solar projects changed their ownership in January-June, up from 11.6 GW a year back. The activity was mostly spurred by players in the oil and gas industry, which accounted for about 6.5 GW or 45% of the total acquisitions. Investment firms, with 6.1 GW, were responsible for 41% of the acquisitions.

(USD 1.0 = EUR 0.887)

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