Energy storage funding soared in 2022, set to continue

Energy storage funding soared in 2022, set to continue

Energy storage funding soared in 2022, set to continue 1024 208 Energy Storage Journal

January 26, 2023: Funding into energy storage continued to grow at record levels in 2022, according to Mercom Capital Group, which provides data on investment markets.

Raj Prabhu, CEO of Mercom Capital Group, said: “the global energy transition, and the shift toward EVs, along with the Inflation Reduction Act, provided strong tailwinds for energy storage companies.

“In addition to record funding activity, energy storage companies and projects were also acquired in record numbers, a reflection of the maturity in energy storage markets and assets.”

The figures may blur into one another but the trend looks unstoppable.

“Total corporate funding in the energy storage sector was up 55% with $26.4 billion in 2022 (highest in a year to date), compared to $17 billion in 2021. However, venture capital funding for energy storage companies decreased to $5.8 billion in 2022 compared to $8.8 billion in 2021,” says Mercom.

Lithium-ion-based battery technology companies received the most venture capital funding in 2022. Other categories that received funding included battery recycling, iron-air batteries, solid-state batteries, and energy storage systems. A record 28 energy storage companies were acquired in 2022 — the most since 2014.

Smart grid companies raised $3.3 billion in venture capital funding in 46 deals in 2022, a 175% increase compared to $1.2 billion raised in 35 deals in 2021. This was the largest amount of such funding raised by smart grid companies since 2010. Total corporate funding, including debt and public market financing, came to $4.7 billion in 58 deals in 2022 compared to $2 billion in 38 deals in 2021.

In 2022, there were 20 M&A transactions recorded in the smart grid sector compared to 19 transactions in 2021.

For further analysis of battery and energy storage funding both past and present and the European Union dilemma, click on the icon at the bottom of the screen to read the latest issue of Batteries International.