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Extension of the ITC was a much needed boost for the sector. Flickr: 401(k) 2012

Extension of the ITC was a much needed boost for the sector. Flickr: 401(k) 2012

Global corporate funding in the solar industry, including venture capital (VC), debt financing and public market financing raised by public companies was US$25.3 billion in 2015, slightly down from US$26.5 billion in 2014, according to consultancy firm Mercom Capital.

Residential and commercial solar project funding had a record year reaching US$5.5 billion over 23 funds in 2015, up from US$4 billion from 34 funds the previous year. SolarCity, Sungevity, Onyx Renewable Partners, Sunlight Financial, Brite Energy and Kilowatt Financial were top fundraisers in 2015.

Raj Prabhu, chief executive of Mercom Capital Group, said: “With the ITC extension, we predict third-party-owned financing companies will continue to raise residential and commercial funds in large numbers.”

Announced large-scale project funding in 2015 was more than US$11.6 billion in 124 deals this year, down from US$14.2 billion raised over 144 deals in 2014.

However, 2015 was a record year for large-scale solar project acquisitions with 204 acquisitions over 12.7GW, nearly double the 6.4GW over 163 transactions from 2014. Mercom said that yieldcos had “spurred” this record year for solar project acquisitions.

Mercom also tallied 1,118 large-scale project announcements totalling 41.1GW during 2015 in various stages of development globally.

Worldwide VC investments reached US$1.1 billion over 83 deals last year, again slightly down from US$1.3 billion in 2014. Downstream solar companies saw US$727 million (69%) of this VC funding, while PV technology firms saw US$173 million, balance of systems (BoS) companies raised US$87 million, and thin-film businesses saw US$44 million VC funding. The largest VC deal was the US$300 million raised by residential solar service provider Sunnova Energy.

There were 109 active investors in 2015 with 14 taking part in multiple rounds

Even though public market financing was weak in Q4 2015, it had its strongest ever year with US$6 billion raised over 38 deals, up from US$5.2 billion in 2014 across 52 deals.

The seven IPOs of 2015, including Sunrun, Xinte Energy, Chorus Clean Energy, SolarEdge Technologies and Grenergy Renovables, brought in more than US$1.8 billion, while yieldcos managed to raise US$1.1 billion in the two IPOs of Sunedison’s TerraForm Global Yieldco and First Solar and SunPower’s 8point3 Energy Partners.

Debt financing last year reached US$18.3 billion of which more than half came from China. Debt financing was slightly down from US$20 billion in 2014.

There were also four securitisation deals in 2015, totalling US$335 million, by Solar City, SunRun, BBOXX and AES.

Meanwhile corporate M&A transactions in the solar sector in 2015 reached more than US$3 billion in 80 transactions, compared to US$4 billion over 116 transactions in 2014.

Prabhu said: “Overall it was a good year for the solar sector considering the turbulence in the stock markets and trouble with yieldcos in the second half of the year. The extension of the investment tax credit (ITC) was a much needed boost for the sector, paving the way for a strong 2016.”

Tags: mercom, finance, venture capital

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