Flow batteries, energy storage system companies attracted most VC funding in 2015, says Mercom

January 21, 2016
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2015’s top deals in batteries and energy storage, according to Mercom. Image: Mercom Capital.
Almost US$700 million of corporate funding went into energy storage in 2015, including US$397 million from venture capital (VC) investment, according to the latest report from Mercom Capital.

The Texas-headquartered analysis and communications firm issued its most recent report into funding and mergers and acquisitions (M&A) activity in the smart grid, energy storage/battery and energy efficiency sectors. Mercom issues these on a quarterly basis, with the latest rounding up the full 2015 calendar year.

In batteries and energy storage, flow battery companies appeared to attract the most interest, raising US$120 million, with US$58 million of that sum accounted for by flow battery storage solution provider VionX in the top spot. Closely following were energy storage system providers which raised US$96 million, with German-US company Younicos leading the charge in its US$50 million “land grab”. First Solar and an unnamed battery manufacturer were among the investors in that deal.

However, according to Mercom, the total amount of funding actually fell slightly in 2015 from 2014’s figures in batteries and storage. Corporate funding in the former totalled US$676 million, while in 2014 US$921 million was raised, while 37 VC deals added up to US$397 million last year, compared to 2014’s US$431 million over 34 deals. In the third quarter of last year, Mercom CEO Raj Prabhu said that in that period, total funding fell but the average deal size grew.

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Prior to that, in an interview with Energy Storage News on second quarter 2015 performance, Prabhu talked about the long term potential of the energy storage sector being greater than what he had seen even with solar, highlighting not only the interest of “typical VCs” and companies such as Mitsui and General Electric – which invested in commercial storage company Stem, but also of high profile investors such as actor and former governor of California Arnold Schwarzenegger.

General Electric invested in commercial storage company Stem this year. Image: Stem Inc.

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