The document summarizes investment and merger & acquisition activity in the grid edge sector from 2010 to the first quarter of 2019. It finds that over this period, venture capital and private equity firms invested $11.6 billion across 1,033 deals. Energy storage saw over $5 billion invested, while customer energy management saw over $2.8 billion. Strategic utilities have increasingly participated in deals since 2010. The document also analyzes M&A activity regarding demand response and distributed energy resource management systems, totaling $665 million across 38 deals. Finally, it discusses European energy majors' recent acquisitions in areas like e-mobility and energy flexibility as they pursue grid edge opportunities.

1. woodmac.comTrusted intelligence
Grid Edge Investment and M&A
Activity
Elta Kolo, Ph.D
Research Manager
Elta.Kolo@woodmac.com

2. woodmac.comTrusted intelligence
Grid edge investors

3. woodmac.comTrusted intelligence
Who’s investing in the Grid Edge?
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
Strategic
Oil & Gas
Strategic
Utility
Venture Capital
Private Equity,
Investment Banks
Other Financial
Strategic
Vendor

4. woodmac.comTrusted intelligence
Who’s investing in the Grid Edge?
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
10 41 1,41973
Strategic
Oil & Gas
Strategic
Utility
Venture Capital
Private Equity,
Investment Banks
Other Financial
Strategic
Vendor

5. woodmac.comTrusted intelligence
Recent deals show growth in strategic utility investments
Percentage of Venture Capital and Private Equity deals 2010 to 2019
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
PercentageofVCdeals
Strategic Utility Strategic Vendor Strategic Oil & Gas Non-Stragetic Investors Undisclosed

6. woodmac.comTrusted intelligence
Venture capital & private equity 2010 through Q1 2019:
$11.6 billion 1,033 deals
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
0
20
40
60
80
100
120
140
160
0
500
1,000
1,500
2,000
2,500
3,000
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 YTD
DealCount
DisclosedValue(MillionsUSD)
AMI Customer Energy Management DER Services Distribution Automation
Electric Vehicle Infrastructure Energy Storage Grid Edge Customer Analytics Grid Edge Network Analytics
Utility Back Office Utility Network Operations Deal Count

7. woodmac.comTrusted intelligence
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Disclosed Value
AMI Customer Energy Management
DER Services Distribution Automation
Electric Vehicle Infrastructure Energy Storage
Grid Edge Customer Analytics Grid Edge Network Analytics
Utility Back Office Utility Network Operations
Cumulative venture capital & private equity 2010 through Q1 2019
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
Energy Storage: over
$5 billion
Customer Energy
Management:
over $2.8 billion
Electric Vehicle
Infrastructure: nearly
$1.5 billion
$11.6 billion
Amazon $700 million
in Rivian

8. woodmac.comTrusted intelligence
Manufacturing
Batteries
HVAC
Water
Heaters
Lighting
Misc.
Loads
Generator
Growth opportunities
EV charging A lot of batteries
Connected
home
Microgrids
Resource mix today Portfolio optimization
FOM BTM
Source: Wood Mackenzie Power & Renewables

9. woodmac.comTrusted intelligence
VC activity of DERMS, DRMS and DER services
$1.9 billion in disclosed value since 2010 for 102 deal
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
0
20,000,000
40,000,000
60,000,000
80,000,000
100,000,000
120,000,000
140,000,000
0 10 20 30 40 50 60 70 80 90
$millionininvestmentround
Deal count
• 39 deals at under $5 M
• 16 deals between $9 M to $5 M
• 26 deals $36 M to $10 M
• 2 deals over $100 M
• 19 deals undisclosed

10. woodmac.comTrusted intelligence
M&A activity of DERMS, DRMS and DER services since 2010
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
0
1
2
3
4
5
6
7
8
9
$0
$100
$200
$300
$400
$500
$600
$700
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 YTD
Dealcount
$,Millions
Disclosed value Deal count
$665 M
38 deals, 12 disclosed ($300M to $4.8M)

11. woodmac.comTrusted intelligence
0
1
2
3
4
5
6
7
8
9
$0
$100
$200
$300
$400
$500
$600
$700
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
YTD
Dealcount
$Millions
Disclosed value Deal count
M&A activity of DERMS, DRMS and DER services since 2010
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
$665 M
12 disclosed deals vary from $300M to $4.8M

12. woodmac.comTrusted intelligence
European majors are on an
aggressive Grid Edge shopping
spree

13. woodmac.comTrusted intelligence
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub
January March June September September October October October November
Q1 2017 Q2 2017 Q3 2017 Q4 2017
December DecemberOctober
Q1 2018
January January February March
Q2 2018
April May May May June July
Q3 2018
March August SeptemberAugust September November
Q4 2018
January DecemberMarch
InvestmentAcquisition
2017
2018

14. woodmac.comTrusted intelligence
Q1 2019 resulted in 5 acquisitions by European majors
Q1 2019
InvestmentAcquisition
FebruaryFebruaryJanuary March March
*
*majority stake
February February
Deals thus far point to a strategic focus of flexibility orchestration
Source: Wood Mackenzie Power & Renewables - Grid Edge Data Hub

15. woodmac.comTrusted intelligence
13 9 6E-mobility Demand response Energy storage

16. woodmac.comTrusted intelligence
Investor spotlight
2017
FebruaryJanuary May May
2018
December
InvestmentAcquisition
DecemberSeptember October
Q1 2019
FebruaryJanuary February
Investments and acquisitions in 2017 to 2019: 12 deals and 7 acquisitions
August

17. woodmac.comTrusted intelligence
Shell’s grid edge shopping spree
1. Portfolio diversification and balancing to hedge their market position
2. Shell can take on longer-term risks and provide financing opportunities
3. As a firm off-taker of fuel, Shell having immediate access to energy consumers is a
strategic advantage
Approaching this from a European model, where most generation companies are retailers

18. woodmac.comTrusted intelligence
Thank You!
Elta Kolo, Ph.D
Research Manager
Elta.Kolo@woodmac.com