January 17 -- Corporate funding (including venture capital funding, public market, and debt financing) for the energy storage, smart grid, and energy efficiency sectors in 2022 increased 63 percent to $31.7 billion in 2022 compared to $19.5 billion in 2021, Mercom Capital Group said in its report.
Corporate funding in the energy storage sector rose 55 percent to $26.4 billion in 2022 (highest in a year to date), compared to $17 billion in 2021. VC funding for energy storage companies fell 34 percent to $5.8 billion in 2022 compared to $8.8 billion in 2021.
Lithium-ion-based battery technology companies received the most VC funding in 2022. Other categories that received funding included battery recycling, iron-air batteries, solid-state batteries, and energy storage systems.
The top VC-funded companies in 2022 were: Eolian ($925 million), Form Energy ($450 million), Group14 Technologies ($400 million), Ascend Elements ($300 million), and Hydrostor ($250 million).
In 2022, debt and public market financing for energy storage companies increased 151 percent with $20.6 billion in 28 deals compared to $8.2 billion raised in 2021. Six energy storage companies went public in 2022 compared to four in 2021.
A record 28 energy storage companies were acquired in 2022 – the most since 2014.
Energy storage project acquisition deals increased over 20 percent with 45 transactions in 2022 compared to 37 in 2021. A record 14.6 GW of energy storage and solar + storage projects were acquired in 2022, a 400 percent increase compared to 3 GW in 2021.
Smart grid companies raised $3.3 billion in VC funding in 46 deals in 2022, a 175 percent increase compared to $1.2 billion raised in 35 deals in 2021. This was the largest amount of VC funding raised by smart grid companies since 2010. Corporate funding, including debt and public market financing, came to $4.7 billion in 58 deals in 2022 compared to $2 billion in 38 deals in 2021.
The top VC-funded companies in 2022 were: TeraWatt Infrastructure ($1 billion), GRIDSERVE ($243 million), Arcadia ($200 million), Sense ($128 million), and Be.EV ($127 million).
Smart charging companies had the largest share of VC funding in the sector in 2022 with $2.2 billion in 26 deals, followed by distributed generation and integration companies with $375 million in seven deals, and data analytics companies with $342 million in four deals.
In 2022, there were 20 M&A transactions recorded in the smart grid sector compared to 19 transactions in 2021.
VC funding for energy efficiency companies came to $490 million in nine deals in 2022 compared to $122 million in seven deals in 2021. Total corporate funding, including debt and public market financing, reached $540 million in 2022 compared to $465 million in 2021.
The top disclosed VC-funded companies in 2022 were: Redaptive ($200 million), Sense ($105 million), GridPoint ($75 million), OhmConnect ($55 million), and Elevation ($20 million).
In 2022, debt and public market financing announced by energy efficiency companies decreased with $50 million in one deal compared to $343 million in one deal in 2021.