Solar Industry Financing Robust During 9M/2023

• According to Mercom, global corporate funding for solar in 9M/2023 rose 55% YoY to $28.9 billion 
• VC funding rose 4% to $5.7 billion, while public market financing increased 47% to $7.2 billion 
• M&A activity declined due to increased due diligence, higher costs, delays and a tight labor market 

Investor interest in global solar PV remains strong as, according to Mercom Capital Research, the sector's total corporate funding for 9M/2023 increased on a year-over-year (YoY) basis 'despite inflationary challenges.'  

The $28.9 billion raised during the period is an increase of 55% from the same period last year when the market intelligence firm reported $18.7 billion raised (see Global Corp Funding For Solar In 9M/2022 Drops 18% YoY). 

Mercom Capital CEO Raj Prabhu attributes this growth to a strong global push towards decarbonization and substantial incentives created by the Inflation Reduction Act (IRA) in the US. 

Of the total corporate funding, venture capital (VC) funding improved 4% YoY to $5.7 billion in 51 deals, led by solar downstream companies with $3.8 billion. The largest amount of $471 million was raised by Germany's 1KOMMA5°. During this period, a total of 159 investors participated in the solar funding. 

With a total of 19 deals, solar public market financing rose 47% YoY to $7.2 billion, while announced solar debt financing totaled $16 billion in 54 deals, 93% higher YoY. An aggregate of 10 securitization deals at $3.2 billion represented a jump of 39% YoY. 

Compared to 90 merger and acquisition (M&A) transactions in 9M/2022, the numbers declined to 75 deals for the same period this year. 

A total of 166 projects were acquired representing 31.6 GW of capacity, compared to 207 projects with 52.1 GW changing hands in the previous year. Prabhu cites increased due diligence, higher costs, delays and a tight labor market for the 'adverse effects' faced by the M&A segment. Project developers and independent power producers (IPP) led the acquirers list, followed by insurance companies, pension funds, energy trading companies, industrial conglomerates and IT firms, among others. 

The largest deal was reportedly the acquisition of Duke Energy's unregulated utility-scale commercial renewables business in the US by Brookfield Renewable for close to $2.8 billion (see North America PV News Snippets).  

Mercom makes these assertions in its 9M and Q3 2023 Solar Funding and M&A Report that can be purchased on its website with prices starting from $299.