The Future of Energy: M&A Activities Increasing in Renewable Energy Sector

Due to a variety of socioeconomic factors, Europe’s energy crisis has caused an increase in demand for companies in the sustainable energy sector. According to the International Monetary Fund, the supply of gas Europe received from Russia was down 80% in 2022 due to the War in Ukraine, which has caused an uptick in interest in renewable energy.

As the effects of the pandemic and invasion of Ukraine continue to have ripple effects across Europe and the globe, renewable energy is becoming more and more important. This has also caused an increase in M&A activity surrounding renewable and alternative energy opportunities. 

Out of the woods — for now

While some concerns about energy price and availability have been managed for the short-term, Europe still faces many long-term concerns. 

For starters, just because prices are down today doesn’t mean that they won’t rise again. Supply from Norway and Qatar, combined with a milder winter, helped Europe weather supply issues. However, according to the New York Times, colder temperatures and an increase in energy consumption could cause a major surge.

Beyond concerns about global consumption, it’s important to remember that fossil fuels cannot last forever. Natural resources are finite, which is why consumers are searching for alternative energy solutions and renewable, sustainable options. 

Why is demand for sustainable energy on the rise?

The recent energy crisis in Europe, and the fact that fossil fuels are not renewable points to some of the reasons that demand for sustainable energy is on the rise. Consumers want to do their part to help reduce reliance on fossil fuels. The same is true for businesses, who are also being incentivized by governmental initiatives to electrify truck fleets and reduce carbon emissions.

In just the past four years, global deal activity (around 40% of which involved a Europe-based target) has increased substantially. Within these deals, renewable energy is factoring in more and more. In fact, there were $425 million dollars worth of deals involving an acquisition of a renewables developer in the first half of 2022 alone. Keep in mind that this was during ongoing economic uncertainty due to the pandemic and Europe’s energy crisis, proof that demand is high for renewables.

Much of this demand is also fueled by younger generations who have grown up in a world on the brink of climate crisis. As such, future-thinking investors who are younger are becoming more and more invested in environmental, social and governance (ESG) opportunities.

All of these factors play a part in creating an increased need for renewable energy, which, in turn, is fueling M&A activity in the renewable energy sector. Tackling climate change, helping transition to alternative energies, and increasing the speed of this transition all impact mergers and acquisitions in this sector.

Just recently, the United States doubled down on its need for EV battery plants and an increase in EV battery development to help automakers meet new EPA targets. The same will surely happen in other parts of the world, as countries continue to bolster their efforts in the world of sustainable energy.

Dealsuite helps you find alternative energy companies

One thing is clear from all of these changes: alternative energy is here to stay. As a result, it’s important to have a platform to discover, buy, and sell sustainable energy businesses.

If you’re looking to invest more heavily in ESG oriented companies, Dealsuite is here to help. Dealsuite’s filtering system makes it easy to discover companies for sale in various sectors, including the alternative energy sector. 

With Dealsuite, you have a host of features at your fingertips to help you find your next deal. With just a few clicks, you can identify targets, save searches based on deal relevancy, and upload deals. 

Book a demo today to find out how Dealsuite can help you find relevant deals.