Global VC funding in wind sector cools off to $315m in '12

Global Venture Capital (VC) funding in wind sector declined by 15 per cent to USD 315 million in 2012, according to Mercom Capital that said the sluggish figures do not indicate lack of innovation in the sector.

According to the communications and consulting firm, the global venture capital funding in 2012 amounted to USD 315 million in 22 deals, a significant slump from the previous year when there were as many as 14 VC funding deals worth USD 369 million.

The top VC deal of the year was the USD 183 million recorded by Element Power, a developer of wind and solar projects in the US and Europe.

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Other deals included USD 21.5 million raised by Mainstream Renewable Power, followed by USD 20.2 million raked in by wind turbine maker ReGen Powertech, USD 18.6 million garnered by power producer Leap Green Energy and USD 15.3 million deal of wind power infrastructure firm Trishe Developers.

"While venture capital funding into new technology firms was sparse, it does not indicate a lack of innovation in the sector as a lot of large manufacturers with their own research and development divisions spend millions of dollars to improve efficiencies and come up with new designs and innovations," Mercom Capital Group Managing Partner Raj Prabhu said.

"A sector still dependent on subsidies, there is still a lot of room for investments in new designs and technologies that reduce costs and increase efficiencies," he added.

Announced large-scale project funding in 2012 totalled USD 14 billion in 71 deals. Of that, USD 4.2 billion in 22 deals came in last three months of the year, the report said. In comparison, large-scale project funding announcements in 2011 came to about USD 11 billion in 52 deals.

Meanwhile, in terms of merger and acquisitions, the year saw strong activity in the wind energy sector, in terms of transactions, as 35 deals were announced worth USD 1.1 billion.