Fund Raising in Renewable EnergyWritten by Jati Andrianto
Overall, fund raise for renewable energy rose in 2010 to US$ 17.4 billion from US$ 14.7 billion in the year prior. Approximately half of the new funds raise came from 36 successful IPOs. World Economic Forum (WEF) data recorded 19 of the IPO in the year were by China-based entities. The United States of America was a distant second with three successful IPOs. There were seven IPOs from Europe, two each in India and Taiwan and one came from Brazil, South Korea, and Thailand.
The most of IPOs came from Asia caused availability ratio of renewable energy in Asia still low and countries in Asia have large renewable energy reserve. Moreover, during 2010 countries in Europe still had debt default problems which made low return in capital market.
Top Public Market Fund Raises
The newest WEF report declared that US$ 4.8 billion or approximately 27.5% of total fund raise during 2010 by ten companies are the most successful in fund raise. This determined is based the highest value of fund raising and time interval of seed financing and fund raising relatively rapid.
Here are ten companies. First, Xinjiang Goldwind Science & Technology Co. Ltd which new equity raising US$ 1.06 billion. Wind power company based in China implemented IPO in Hong Kong Stock Exchange (HKEX).
Second, China Datang Corp Renewable Power Co. Ltd which new equity raise US$ 682 million. Wind power company based in Hong Kong implemented IPO in HKEX.
Third, Renewable Energy Corp ASA which new equity raise US$ 675 million. Solar energy company based in Norway implemented exercise of warrants as fund raise scheme in Oslo Stock Exchange (Oslo Bors).
Fourth, Sanan Optoelectronics Co. Ltd which new equity raise US$ 456 million. Solar energy company based in China implemented Private Investment in Public Equity (PIPE) as fund raise scheme in Shanghai Stock Exchange (SSE).
Fifth, China Suntien Green Energy Corp. Ltd which new equity raise US$ 425 million. Wind power company based in China implemented IPO in HKEK.
Sixth, Shanghai Chaori Solar Energy Science & Technology Co. Ltd which new equity raise US$ 358 million. Solar energy company based in China implemented IPO in Shenzhen Stock Exchange (SZSE).
Seventh, China Ming Yang Wind Power Group Ltd which new equity raise US$ 350 million. Wind power company based in China implemented IPO in New York Stock Exchange (NYSE).
Eighth, Cosan SA Industria e Comercio which new equity raise US$ 302 million. Biofuels company based in Brazil implemented exercise of warrants as fund raising scheme in Sao Paulo Stock Exchange (BOVESPA).
Ninth, China High Speed Transmission Equipment Group Co. Ltd which new equity raise US$ 291 million. Wind power company based in Hong Kong implemented PIPE as fund raising scheme in HKEK.
Tenth, Risen Energy Co. Ltd which new equity raise US$ 280 million. Solar energy company based in China implemented IPO in SZSE.
Successful of fund raise in renewable energy during 2010 couldn’t be separated by Private Equity (PE) and Venture Capital (VC) role. Bloomberg News Energy Finance recorded during 2010 PE and VC invested US$ 8.8 million in renewable energy company when doing fund raise.
Fund Raising Chance in Indonesia?
Successful of fund raise in renewable energy by China companies should be also implemented in Indonesia. Indonesia and China have similar characteristics, such as large population, unfulfilling of availability electricity ratio, large of renewable energy reserve, and increased potential of capital market capitalization.
Moreover, recently as well as future Indonesia will have strong macro economic performance which make renewable energy investment in Indonesia be interested. Based on our calculation, investment rate of return (IRR) in renewable energy in Indonesia minimum 15 percent per annum. This prognosis should be a base by USA and Europe investor for investing in renewable energy project in Indonesia as new portfolio and will execute IPO as fund raising scheme and exit strategy some years later. This strategy should be executed caused the highest investment return in USA and Europe only four percent per annum.