Clean energy investment at record level

 

Clean energy investment at record level



London, 10 August: Global private equity investment in clean energy has
soared to more than $2 billion in the second quarter of 2006, according
to figures from New Energy Finance (NEF).

The London-based analysts said this was three times the amount of
venture capital and equity investment in the first quarter of 2006, and
double the figure for the same period last year.

The number of deals also increased - to 88, against 66 in the first
quarter and 78 in the second quarter of 2005 - as did the average
deal size, suggesting that investors remain confident about the sector
as it grows, NEF said.

The company said the surge in private investment in public equity
(PIPE) was particularly noteworthy. Traditionally, private investors
have been a last resort for publicly-listed companies raising funds,
but this year they have taken centre stage in the clean energy sector.
PIPE investments reached $556 million in the second quarter, compared
to just $21 million in the first quarter and $28 million in the same
period of 2005.

This financing route was particularly popular among small-cap
companies, who are going to private investors to fund expansion rather
than committing to a full secondary offering. For instance, US fuel
cell membrane developer Plug Power attracted $217 million from
Interros, one of Russia's largest private investment companies, and
Norilsk Nickel, the world's largest producer of palladium and nickel
metal.

NEF also noted enthusiasm for California's solar sector. "The last two
years have seen an extraordinary ramp-up in the value of the solar
photovoltaic sector. This was driven initially by extremely (some would
say overly) generous tariffs paid in Germany for electricity from solar
power. Now it is California's turn to drive the market," the report
said, following the states' January announcement of $3.2 billion in
subsidies for the sector.

New Energy Finance forecasts that total venture capital and private
equity deal value between 2006 and 2012 in the sector will be just over
$100 billion.

http://www.environmental-finance.com/onlinews/1008nef.htm