Smart electric vehicle charging companies top smart grid VC funding in 2020

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Smart electric vehicle (EV) charging companies secured over 40% of smart grid venture capital funding in 2020, Mercom Capital Group has reported.

Mercom, which monitors investments in the smart grid and other sectors, reports that in 2020 smart charging companies received $324 million in 13 deals, out of a total of $748 million in 38 deals in the smart grid sector.

Smart grid communications companies were next in line with $119 million in six deals, followed by demand response companies with $104 million in three deals.

Once again the top VC company was California-based ChargePoint, which on March 1 became “the first publicly traded electric vehicle charging company operating across continents,” according to president and CEO, Pasquale Romano.

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Together with next in line Chinese charging infrastructure provider Start Charge, these two companies accounted for about one-third of the 2020 VC funding in the sector.

This dominance of smart charging marks a continuation of the trend first observed in 2017, except for 2019 which was down on most fronts, and reflects the appetite to capitalise on the fast growing EV market and the smart grid market more generally.

Overall in 2020 VC funding for smart grid companies was 149% up on the $300 million for a similar number of deals in 2019. However, the 21 merger and acquisition transactions were down on the 29 in 2019.

Other findings in the annual roundup were that corporate funding in the battery storage sector was up 136% with $6.6 billion in 54 deals in 2020. However, VC funding for battery storage companies was slightly down at $1.5 billion in 32 deals compared to $1.7 billion in 32 deals in 2019.

Of these lithium-ion based battery technology companies received the most VC funding in 2020, with Sweden’s Northvolt the largest recipient. Other categories that received funding included solid state batteries, energy storage downstream, energy storage systems and flow batteries.

VC funding for energy efficiency companies came to $291 million in 16 deals in 2020 compared to $298 million in nine deals in 2019.

There were nineteen merger and acquisition transactions in the battery storage category and four in the energy efficiency category in 2020, compared with ten and nine respectively in 2019.