According to Clean Energy Pipeline, the online financial news and data service dedicated to the clean energy sector, new investment in the global clean energy sector totalled $66.2 billion in the second quarter of 2014. That represents an 8% increase on the $61.2 billion invested during the corresponding period in 2013.
Clean energy project finance totalled $40.1 billion in 2Q14, a 4% uptick on the $38.5 billion invested in 1Q14 and a 12% increase on the $35.8 billion invested during the corresponding quarter in 2013. In fact project finance recorded a five-quarter high in 2Q14. Investment in 2Q14 was boosted by the Eur2.8 billion ($3.8 billion) project finance deal structured for the 600 MW Gemini offshore wind farm in the Netherlands. The deal, which is the largest ever non-recourse project finance transaction for a single asset tracked by Clean Energy Pipeline, accounted for 9% of all project finance investment globally in 2Q14.
Investment in 2Q14 was also bolstered due to a surge in onshore wind investment – onshore wind project finance totalled $18.0 billion in 2Q14, a significant increase on 1Q14 ($13.7 billion) and 2Q13 ($13.8 billion). The volume of onshore wind financing was particularly high due to a series of large deals in emerging markets.
“It is perhaps a little early to make predictions, but based on investment levels during the first six months of 2014 last year’s total looks like it will be eclipsed,” said Douglas Lloyd, CEO of Clean Energy Pipeline. “This is very positive news given that total clean energy investment posted annual year-on-year declines in both 2012 and 2013.”
Steals and deals
Notable deals include the 300 MW Aysha wind farm in Ethiopia, which secured a $1.3 billion loan from various banks and financial institutions including Deutsche Bank, Credit Suisse, JP Morgan and Barclays in May 2014; and Fisterra Energy, which closed a $650 million project finance deal for the 252 MW Ventika wind farm in Mexico in April 2014.
According to Clean Energy Pipeline, renewable power companies raised $5.3 billion on the public markets globally in 2Q14 through a mixture of IPOs, secondaries and convertible notes, in line with the $5.4 billion raised in 1Q14 and 25% above the $4.3 billion secured during the corresponding quarter in 2013. Notably, the number of public markets listings hit 30 in 2Q14, a three-year high.
The surge was a direct result of continued YieldCo fundraising activity. YieldCos secured $2.1 billion on the public markets in 2Q14 from three new YieldCo IPOs and two secondary YieldCo offerings. In the US, Abengoa Yield, the YieldCo subsidiary of Abengoa, secured $829 million via an IPO on NASDAQ while NextEra Energy Partners, the YieldCo vehicle of NextEra Energy, raised $467 million through an IPO on the New York Stock Exchange. In the UK, YieldCo fund NextEnergy Solar Fund secured $118 million through an IPO on the London Stock Exchange.
More information on the report, including venture capital and private equity activity in the green energy sector, is available online.