SOURCE: Mercom Capital Group

Mercom Capital Group

July 07, 2016 14:35 ET

Total Corporate Funding in the Solar Sector Comes to $1.7 Billion in Q2 2016, a 41 Percent Drop From Q1 2016, Reports Mercom Capital Group

Residential/Commercial Funds Bring in $1.36 Billion in Q2 2016, Debt and Public Market Financing Slump Continues

AUSTIN, TX--(Marketwired - Jul 7, 2016) -  Mercom Capital Group, llc, a global clean energy communications and consulting firm, released its report on funding and merger and acquisition (M&A) activity for the solar sector in the second quarter of 2016. 

Total corporate funding, including venture capital and private equity (VC) funding, public market and debt financing into the solar sector in Q2 2016 fell to $1.7 billion, a 41 percent drop compared to the $2.8 billion raised in Q1 2016. Year-over-year total corporate funding was down significantly compared to $5.9 billion in the second quarter of last year.

Image: Solar Corporate Funding Q2 2015 - Q2 2016

"The solar industry continues to experience weakness in terms of financing activity and corporate funding in Q2 2016 was at its lowest level in three years," said Raj Prabhu, CEO and Co-Founder of Mercom Capital Group.

Global VC funding (including private equity) dropped to $174 million in 16 deals compared to $406 million in 23 deals in Q1 2016.

Solar downstream companies raised 64 percent of VC funding in Q2 2016 with $112 million in seven deals.

Image: Solar VC Funding Q2 2015 - Q2 2016

Other VC deals included the $20 million raised by Tigo Energy, 1366 Technologies' $15 million raise, and the $12.5 million raised by Sol Voltaics.

Public market financing in Q2 2016 came to $179 million in four deals compared to $94 million in four deals in Q1 2016.

Announced debt financing came to $1.3 billion in 12 deals in Q2 2016.

It was a good quarter for residential and commercial solar funds led by SolarCity, Mosaic, and Sunnova Energy with $1.36 billion in 11 deals in Q2 2016, compared to the $1 billion raised in six deals in Q1 2016. In Q2 2016, $800 million went towards the lease model and $555 million went to loan funds. Since 2009, almost $20 billion has gone into residential/commercial solar funds.

The top large-scale project financing deals each brought in over $100 million.

Image: Solar Top 5 Announced Large-Scale Projects Funded By Dollar Amount in Q2 2016

There were 17 solar M&A transactions in the second quarter of 2016, eight of which involved solar downstream companies. Sungevity announced a merger with Easterly Acquisition Corp, a blank check company traded on Nasdaq in a deal valued at $357 million.

More than 2 GW of solar projects were acquired in the second quarter compared to the 2.4 GW in the previous quarter.

Image: Solar Top 5 Project Acquisitions by Dollar Amount in Q2 2016

Mercom also tracked 196 new large-scale project announcements worldwide in Q2 2016 totaling 11.3 GW.

To learn more about the report, visit: http://bit.ly/MercomSolarQ22016

About Mercom Capital Group
Mercom Capital Group, llc, is a global communications and research and consulting firm focused exclusively on clean energy and financial communications. Mercom delivers widely read industry funding and market intelligence reports covering Solar, Smart Grid, Battery Storage and Efficiency. Mercom's consulting division advises cleantech companies on new market entry, custom market intelligence and overall strategic decision-making. Mercom's communications division helps clean energy companies and financial institutions build powerful relationships with media, analysts, government decision-makers, local communities and strategic partners. For more information about Mercom Capital Group, visit: http://www.mercomcapital.com. To get a copy of Mercom's popular market intelligence reports, visit: http://mercomcapital.com/market_intelligence.php