October 10 (Solar) – Global clean energy investment in the third quarter (Q3) of 2018 slipped by 6% on the year to USD 67.8 billion (EUR 58.9bn) but the period was marked by growing investment in the electric vehicles (EVs) market, show figures from Bloomberg New Energy Finance (BNEF) released Tuesday.
Equity raising by EV companies was “a conspicuous bright spot” in the July-September quarter, particularly given the EV boom in China. “We’re seeing more companies raising funds as they look to make the jump from concept cars to high-volume manufacturing. But the market looks increasingly crowded and consolidation is likely,” said Colin McKerracher, head of advanced transport analysis at BNEF.
The third quarter witnessed the USD-1-billion initial public offering (IPO) by Chinese EV start-up NIO Inc (CVE:NIO), the USD-585-million Series C venture capital financing round by Guangzhou Xiaopeng Motors and the pre-IPO round of Zhejiang Dianka Automobile, in which it seeks to raise USD 294 million.
In spite of the year-on-year drop in Q3 investment, the total so far is just 2% below that for the first nine months of 2017, leaving hopes that figures for 2018 will match last year’s total, especially if some multibillion-dollar offshore wind deals are signed before Christmas, BNEF said.
The largest category of clean energy investment in Q3 was asset finance of utility-scale renewable energy projects. Coming at USD 49.3 billion, it was down 15% in annual terms.
The most notable transaction in the reporting period was the financing of the USD-2.6-billion 860-MW Triton Knoll offshore wind project in the UK, led by German developer Innogy SE (ETR:IGY). Onshore construction for the project was officially launched last month.
The other top asset finance deals came from Italy’s Enel SpA (BIT:ENEL) and its USD 1.4 billion worth of deals to back a 706-MW wind project portfolio in South Africa, as well as the USD-1.2-billion financing for the fourth 300-MW phase of the Guohua Dongtai offshore wind complex in China.
Public markets investment lept by 120% to USD 3.1 billion. The biggest deal was NIO’s floatation, followed by a USD-1.3-billion convertible issue from waste-to-energy firm China Everbright Intl (HKG:0257) and the USD-311-million IPO of California-based fuel cell company Bloom Energy Corp (NYSE:BE).
Venture capital (VC) and private equity (PE) funding of clean energy companies soared by 378% to USD 2.4 billion, paving the way for the strongest quarter since 2011. The top six deals in that category involved Chinese EV companies.
According to BNEF’s statistics, global Q3 clean energy investment was once again led by China with USD 26.7 billion. In spite of the EV boom in the country, however, its solar market slowed down due to certain policy changes, with solar investment falling 23% to USD 14.2 billion in July-September.
The table below shows clean energy investments in the top 10 markets, as given by BNEF.
|Market||Q3 investment (in USD)||Y/Y change|
|S Africa||2.6 billion||up 90-fold|
|Spain||1.9 billion||up 11-fold|
(USD 1.0 = EUR 0.869)