Report: Wind, Solar Powering Renewables M&A Activity

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Strong mergers and acquisition (M&A) growth in wind and solar power sectors is adding to renewable energy deal momentum, according to an analysis of deal making in the industry published by PricewaterhouseCoopers (PwC). Solar overtook hydro as the second-largest renewables deal category after wind, accounting for 20% of total renewables deals.

The impact of the credit crisis was felt in terms of value of deals, dropping even though the number of deals held up.

‘The renewable energy sector is an increasingly important arena as companies and investors respond to the growing role of renewable sources in meeting global energy demands – 2009 will be a watershed year,’ says Manfred Wiegand, global utilities leader at PwC. ‘Falling energy prices are casting doubt on the viability of some renewable energy schemes out there; however, governments have a chance to set a more certain framework for the industry.’

Some key findings of the report include the following:

– A quarter of deals in the power sector are for renewable assets or technology;

– Renewable energy now accounts for one-tenth of M&A value in the wider power sector; and

– During 2007 and 2008, 441 renewables deals were announced with a reported value totaling $70.3 billion.

The focus for renewables deals became increasingly concentrated on Europe during 2007 and 2008, with a value of $17 billion, whereas deal value in the rest of the world fell year on year by 63%. North America's share of worldwide renewables volume held broadly level with just under one-quarter of worldwide deal value.

SOURCE: PricewaterhouseCoopers

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