Investment in smart grid, storage sectors soars

Investment in the smart grid, battery/storage and energy efficiency sectors grew dramatically in the first quarter of the year, according to the latest data from market research firm Mercom Capital Group.

Venture capital investments by sector showed that smart grid companies raised $185 million in 15 separate deals, while battery/storage firms took in $69 million from seven deals. Investors also plunked $140 into energy efficiency companies in 15 different deals.

Smart grid

The $185 million raised by the smart grid sector is a major increase over the $59 million it received from 13 deals in the fourth quarter of 2014. This yearÂ’s first-quarter investments included four early stage deals, including three series A and one seed funding deal.

A total of 37 venture capital investors, including one accelerator, participated in funding rounds in the first quarter. Within the smart grid sector, smart grid communications technology companies received the most funding. EnerTech Capital was the only investor participating in multiple deals this quarter with three investments.

The top venture capital investment in the period was the $115 million raised by SIGFOX, a wireless connectivity solutions provider for smart metering, building intelligence and M2M using ultra narrow band technology. Other major deals included the $15 million raised by Tempered Networks, a cyber-security company; the $14 million raised by Blue Pillar, a provider of software-based solutions for real-time visibility and control into distributed energy assets; the $11 million raised by Enbala Power Networks, a provider of demand-side grid optimization services for commercial and industrial large-scale electricity users; and the $8.4 million raised by TROVE Predictive Data Science, a provider of applications for load forecasting, revenue protection, demand-side management and program planning for utilities.

There were seven smart grid mergers and acquisition transactions (four disclosed) totaling $196 million, according to the Mercom report, among them the acquisition of AlertMe, a home automation platform, energy monitoring and control, and analytics provider, by British Gas (part of the Centrica plc group) for $100 million. Bluegiga Technologies, a Finnish provider of short-range wireless connectivity and software solutions for home automation and industrial automation, was acquired by Silicon Labs for $61 million. RadioPulse, a Seoul-based developer of ZigBEE for AMR, wireless automation, home network and high technology markets, was acquired by IXYS for $22.5 million. Detectent, a provider of utility data analytics solutions, was acquired by Silver Spring Networks for $12 million.

Battery/storage

VC funding for battery/storage companies reached $69 million in seven deals, up from $47 million in seven deals in the fourth quarter of 2014. Top deals included the $20 million raised by Boston Power, a manufacturer of lithium-ion batteries for electric vehicles and stationary energy storage, and the $20 million raised by Sakti3, a developer of solid-state rechargeable lithium-ion battery technology. Eos Energy Storage, a developer and manufacturer of zinc hybrid cathode energy storage solutions for electric utilities, raised $15 million. TAS Energy, an energy storage solutions provider that combines turbine chilling with thermal energy storage tanks, raised $10 million, and ZAF Energy Systems, a developer of nickel-zinc and zinc-air battery technologies, raised $2.2 million.In the only debt and public market financing deal announced for battery/storage technology, Bloom Energy, a manufacturer of solid oxide fuel cell technology products, raised $130 million.

Energy efficiency

VC funding in the efficiency sector fell by more than $50 million sequentially to $140 million from 15 separate deals. The top investment was had by Verne Global, a developer of energy efficient data centers, which secured $98 million, followed by Terralux, a designer and manufacturer of LED lighting and building intelligence solutions, which raised $11 million. RayVio, a solid state ultraviolet LED solutions provider, raised $9.3 million.Efficiency companies also raised $183 million in debt and public market financing in three first-quarter deals, including one IPO. MLS, a Chinese LED manufacturer and the parent company of U.S.-based Forest Lighting, raised $154 million through its initial public offering and began trading on the Shenzhen Stock Exchange in China in March 2015.

A copy of the report is available here.