In the first nine months of 2017, $1.23 billion was raised by battery storage, smart grid and efficiency companies, up from $910 million raised in 9M 2016. Mercom Capital Group, a global clean energy communications and consulting firm, has released its latest quarterly report on funding and merger and acquisition (M&A) activity for the sectors during the third quarter and first nine months of 2017.
In Q3 2017, VC funding for battery storage companies dropped to $83 million in seven deals compared to $422 million raised in 10 deals during Q2 2017. A year earlier, $30 million was raised in nine deals in Q3 2016. In 9M 2017, $563 million was raised in 25 deals compared to $209 million raised in 29 deals in 9M 2016, the report added.
The top VC funded battery storage companies in Q3 2017 were: Advanced Microgrid Solutions, which raised $34 million from Energy Impact Partners; Southern Company; DBL Partners; GE Ventures; AGL Energy; Macquarie Capital and former California Governor Arnold Schwarzenegger; Romeo Power, which raised $30 million; and Gridtential Energy, which secured $11 million from 1955 Capital; East Penn Manufacturing; Crown Battery Manufacturing; Leoch International; Power-Sonic; The Roda Group, and the company's chairman, Ray Kubis.
There was one M&A transaction involving a Battery Storage company in Q3 2017 compared to three M&A transactions in Q2 2017. In the first nine months of 2017, there were five transactions (two disclosed), down from nine transactions (two disclosed) in 9M 2016. Two Storage projects were also acquired in Q3 2017.
According to the report, VC funding for smart grid companies in Q3 2017 totaled $76 million in 14 deals, compared to $139 million raised in eight deals in Q2 2017. In a year-over-year (YoY) comparison, $11 million was raised in seven deals in Q3 2016. In 9M 2017, $380 million was raised in 36 deals compared to $343 million raised in the same number of deals in 9M 2016.
Top VC funded smart grid companies included: Particle, which secured $20 million from Spark Capital, Qualcomm Ventures, and previous investors; INTEREL, which raised $11.9 million in funding from Jolt Capital; Roost, which received $10.4 million in funding from Aviva Ventures, Desjardins Insurance, and Fosun RZ Capital; Tritium, which secured $8 million from entrepreneur Brian Flannery; and Innowatts, which raised $6 million from Shell Technology Ventures, Iberdrola Ventures - Perseo, and Energy & Environment Investment.
A total of $11 million was raised in one debt financing deal in Q3 2017 compared to the $9 million raised in one deal in Q2 2017. In 9M 2017, $20 million was raised in two deals compared to $217 million raised in four deals in 9M 2016.
VC funding raised by energy efficiency companies in Q3 2017 came to $47 million in eight deals compared to $29 million raised in six deals in Q2 2017, highlighted the report. In a year-on-year comparison, $61 million was raised in five deals in Q3 2016. In the first nine months of 2017, $289 million was raised by Energy Efficiency companies in 28 deals compared to $358 million raised in the same number of deals in 9M 2016.
The top VC deals in the efficiency category included: Power Survey and Equipment, which received $24 million in funding from EnerTech Capital, Investissement Quebec, Cycle Capital Management, Fonds de solidarite FTQ, and BDC Capital; Corvi, which received a $10 million strategic investment from Hero Enterprise; and Deco Lighting, which secured $8 million in funding from Siena Funding.