Amid a seemingly endless deluge of terrifying climate news, new projections from research firm BloombergNEF offer a rare glimmer of hope: global CO2 emissions may have hit their peak last year.
What’s behind this crucial shift?
One major factor is the shockingly rapid adoption of wind and solar power, especially by China. The amount of renewable energy capacity added globally in 2023 shot up by nearly 50%, the International Energy Agency reports. With this shift, emissions from the power sector are projected to decline this year.
And as electric vehicle adoption continues to climb, global emissions from the transportation sector are also expected to fall.
To keep the momentum going, the infrastructure supporting clean power generation — including installation and maintenance, microgrids, grid management and optimization, energy storage, and EV charging — is crucial.
In this PE Playbook, the Grata team has put together the need-to-know trends for investors considering making moves in the clean power infrastructure market, including:
- How the space is fragmented
- Where the most deals are happening
- What kinds of companies are being acquired
The market map above is not intended to be an exhaustive representation of companies in the space.
Companies that provide services that fall into multiple segments are categorized in this report by their primary offering.
Industry Overview
Market Distribution
Geography
Source: Grata
Clean power is a global market, with the US, the UK, and Australia leading in number of companies.
Source: Grata
Within the US, California, Texas, and New York are home to the most clean power companies.
Notably, Texas has been the top state for wind power generation for the last 17 years, with over 18,000 active turbines. In 2023, wind accounted for 28.6% of the state’s total energy generation, only falling behind natural gas.
Ownership
Source: Grata
The clean power space is fairly fragmented. While the vast majority of companies in the space are independently owned, publicly traded companies and their subsidiaries account for 61% of employee headcount.
Segment Distribution
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Source: Grata
This report focuses on the following segments, all of which provide services that support the infrastructure of the clean power industry. Grata users can see a curated list of some of the companies used to create each segment by clicking the links below.
- Installation & Maintenance: Companies in this segment provide installation and maintenance services for solar and wind energy projects.
- Energy Storage: These companies offer solutions that capture and store energy to meet power demand and provide backup power as needed.
- EV Charging: This space focuses on infrastructure to support electric vehicle charging.
- Grid Management & Optimization: Companies in this space provide tech solutions to make power generation, transmission, and distribution as efficient and sustainable as possible.
- Microgrids: These companies create and maintain self-contained electrical networks that can function either independently from the main power grid or in connection with it.
Public Comparables
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Source: Grata
Generally speaking, companies that support clean power generation are showing strong financial performance.
The EV charging sector stands out for its 15.1x mean EV/EBITDA multiple, the highest of the spaces covered in this report. Its mean 12-month trailing EV/Gross Profit multiple is also astronomically higher than the industry average at 108.9x.
While the microgrid sector trails the industry average in terms of revenue and mean gross margins, it boasts the highest mean EV/Gross Profit multiple at a whopping 130.9x.
The energy storage market is an interesting case — it sees the most average revenue, but it is the only space analyzed here with negative average gross margins. Energy storage technology is evolving rapidly, with battery-based storage capacity installations increasing by over 1200% between 2018 and H1’23, according to Adex. However, the tech still has a long way to go before it’s suitable for large-scale projects.
Meanwhile, the cost of the battery components needed for energy storage projects remain at historic levels, eating away at company returns.
Private Comparables
Source: Grata
Energy storage companies also lead the private sector in terms of average estimated revenue and raised funding.
Notably, returns for energy storage focused on mobility (e.g., electric vehicles) tend to be higher than those focused on grid energy storage. EV-focused companies generally receive more investor attention and funding, hindering the progress of utility-scale energy storage.
Microgrid companies trail the rest with only $7.3M in average funding raised, signaling a potential opportunity for investors looking to fund the clean power infrastructure space.
Notable Acquisitions
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Source: Grata
The clean power infrastructure space has seen a high amount of activity in the last six months alone.
The installation and maintenance sector leads in the number of M&A deals since December 2023.
Below, we’ve highlighted a notable middle-market acquisition for each segment.
Source: Grata
Most of these deals allowed the acquirer to considerably expand its geographical presence, as detailed below.
Installation & Maintenance: Good Energy Acquires JPS Renewable Energy
UK-based energy services company Good Energy purchased solar and battery storage installer JPS Renewable Energy, also based in the UK, in February.
Good Energy reported that the deal would expand the company’s geographic footprint, enabling it to install solar services across South England. This expansion would bolster Good Energy’s efforts to “help one million homes and businesses to cut their carbon by 2025.”
Similar Companies
If you’re an investor interested in companies like JPS Renewable Energy, try these:
Note: Only Grata users can access the full company profiles — which include financials, employee and growth estimates, executive contacts, and more — linked above.
Energy Storage: Aggreko Acquires RenEnergy
In January, global energy solutions provider Aggreko bought the South Africa- and UK-based businesses of RenEnergy, an energy storage company.
The acquisition will reportedly enable Aggreko to deepen its presence in the renewable energy space, while allowing both companies to provide more comprehensive services to a larger clientele.
Similar Companies
If you’re an investor interested in companies like RenEnergy, try these:
Note: Only Grata users can access the full company profiles — which include financials, employee and growth estimates, executive contacts, and more — linked above.
EV Charging: SolarEdge Technologies Acquires Wevo Energy
Publicly traded SolarEdge Technologies completed its acquisition of EV charging software startup Wevo Energy in April.
Wevo’s charging software is vendor agnostic and is reportedly already integrated with SolarEdge’s electric vehicle chargers. Following the acquisition, Wevo’s product will be added into SolarEdge’s energy optimization system designed for the commercial and industrial sector. The system aims to support large-scale EV charging.
Similar Companies
If you’re an investor interested in companies like Wevo Energy, try these:
Note: Only Grata users can access the full company profiles — which include financials, employee and growth estimates, executive contacts, and more — linked above.
Grid Management & Optimization: Swell Energy Acquires Renu Energy Solutions
Swell Energy, which provides energy management and grid solutions, announced its acquisition of North Carolina-based Renu Energy Solutions in February. Renu provides energy monitoring services, as well as solar installations, at the residential and commercial levels.
Swell reported that the deal would expand its presence in the Southeast and mid-Atlantic markets, strengthening its residential and commercial energy solutions in the regions.
Similar Companies
If you’re an investor interested in companies like Renu Energy, try these:
Note: Only Grata users can access the full company profiles — which include financials, employee and growth estimates, executive contacts, and more — linked above.
Microgrids: Energy Systems Group Merges With PacificWest
Sustainable infrastructure and energy services provider Energy Systems Group (ESG) merged with PacificWest in April to broaden their range of offerings.
ESG said the move would also expand its presence in the western US, where PacificWest has historically operated.
Similar Companies
If you’re an investor interested in companies like PacificWest, try these:
Note: Only Grata users can access the full company profiles — which include financials, employee and growth estimates, executive contacts, and more — linked above.
Get the Most Out of the Playbook
If you’re an investor interested in making moves in the clean power infrastructure space, Grata can help you put the insights in this article into action.
From in-depth market research to sourcing to pipeline management and relationship nurturing, Grata’s end-to-end dealmaking platform streamlines your workflows so that you can close more deals.
Schedule a demo today to get started.
