Mordechai Gal: renewable energy M&A specialist? Renewable energy is defined as the contribution of renewables to total primary energy supply (TPES). Renewables include the primary energy equivalent of hydro (excluding pumped storage), geothermal, solar, wind, tide and wave sources. Energy derived from solid biofuels, biogasoline, biodiesels, other liquid biofuels, biogases and the renewable fraction of municipal waste are also included. Biofuels are defined as fuels derived directly or indirectly from biomass (material obtained from living or recently living organisms). This includes wood, vegetal waste (including wood waste and crops used for energy production), ethanol, animal materials/wastes and sulphite lyes. Municipal waste comprises wastes produced by the residential, commercial and public service sectors that are collected by local authorities for disposal in a central location for the production of heat and/or power. This indicator is measured in thousand toe (tonne of oil equivalent) as well as in percentage of total primary energy supply.

The world needs more green energy to replace fossil fuels as an energy source. And strong demand tends to make a good case for energy investments such as wind and solar powers. However, there are other factors that determine whether backing renewables with your money is the right decision for you. These include the health of the global economy, local regulation and policy. When the global economy is strong, demand for power soars and its price grows. This means that the value of companies producing power begins to rise. On top of increased appreciation of sustainability and higher green investment, the pandemic also accelerated the shift to automated, digitized processes. This has laid the ideal foundation for jobs in renewable energy technology.

Mordechai Gal, operations director at AccessHeat Inc, said : This year’s record renewable electricity additions of 290 gigawatts is yet another sign that a new global energy economy is emerging. The high commodity and energy prices we are seeing today pose new challenges for the renewable industry, but elevated fossil fuel prices also make renewables even more competitive. Solar energy is the energy that comes from the sun can be harvested by various technologies including solar panels, either on individual homes or in large solar farms. Solar energy now accounts for about 4% of the UK’s electricity.

Wind power system is catching up to the solar power as the most utilized renewable energy source. According to Global Wind Energy Council (GWEC), wind power is the most newly installed renewable energy systems in 2015, especially for industrial usage. Hydroelectric technology is the oldest renewable energy utilized by men. The very first hydroelectric power plant was built in 1878 and is still one of the most popular ways to generate electricity in most countries. According to National Geographic, hydropower generates almost 20% of today’s electricity all around the globe and is still the cheapest renewable energy resource. Geothermal technology produces electricity and power by utilizing the (almost) unlimited heat generated by the earth’s core. According to Union of Concerned Scientists, geothermal is responsible for more than 11,000 MegaWatts of electricity all around the world in 2013 and has increased ever since. 30% of that number is generated in the U.S. alone. By 2019, geothermal energy is also expected to be cheaper than coals and natural gas, with expected cost around 5 cents per kiloWatt hour.

We are seeing a wide range of transactions in the renewable energy consolidation market, prompted by a broad spectrum of drivers. Although recent changes in the laws and regulations governing filings with the Committee on Foreign Investment in the United States (CFIUS) have increased the complexity and timelines for some cross-border renewable energy transactions, non-US investors continue to show keen interest in US renewable assets. The number and variety of prospective purchasers has heightened competition for good renewable energy projects, with the result that buyers are increasingly willing to acquire projects during development and construction, and thereby to prioritise the project’s prospects over the risks presented by the development process. Renewable energy M&A transactions are increasingly involving the acquisition of portfolios of projects rather than individual projects, and the acquisition of renewable energy companies as ongoing businesses, so that the buyer can obtain the benefit of the development and operating personnel of the target.

Companies are still struggling to generate breakeven cash flow, which resulted in a brief wave of mergers and acquisitions (M&A) in the U.S. upstream space. Most of the M&A has been completed with low premiums and financed through all-stock transactions. Exploration and production (E&P) and oilfield service companies continue to see a wave of defaults and distressed exchanges due to lack of capital market access. For many drillers and oilfield services companies, many market and financial risks have already materialized in the past two oil price downturns. Even as the sector continues to restructure operationally and financially, with some exits and mergers, it remains beholden to expectations for oil prices and producers spending in 2021 and the long term.

In addition, a large number of energy sources have been identified and developed to offset the negative impacts on our climate. A few of the most prominent sources are solar, wind, hydro, geothermal, and tidal have been earmarked to power the future. The focus on reducing and even eliminating the carbon footprint of energy has forced renewable energy companies to look outward and grow into more extensive and more efficient operations. Access-Heat.com will invest in and guide you to the most favorable outcome possible with your renewable energy business consolidation.