Declining solar, storage valuations drive increased M&A: Mercom

Group 1 - The renewable energy sector faced challenges in 2025, including policy uncertainty and higher interest rates, but this led to increased mergers and acquisitions due to lower valuations and growing energy demand [3][4][7] - Global venture capital and private equity funding for solar companies decreased by 22% in 2025, while solar mergers and acquisitions rose by 17%, with 96 transactions compared to 82 in 2024 [4][7] - Energy storage M&A activity saw a significant decline of 71% in total value in 2025, but the number of project acquisitions increased from 38 in 2024 to 65 in 2025 [4][7] Group 2 - There is a strong interest in late-stage, low-risk renewable energy projects, which are considered valuable commodities in the current market [5] - Funding for smart grid technology companies increased by 38%, with deal numbers rising by 25%, driven by investor excitement in AI and energy demand [5] - Despite the interest in new grid technologies, there is uncertainty regarding whether utilities will adopt them, particularly in saturated markets like CAISO and ERCOT [6]