After raising $25M+ in venture capital, strategic investment and private equity over the last 5 years, Omnidian acquires PV Pro’s O&M business to grow it’s share of the solar electricity monitoring and management market to 10%.
Solar M&A Deal Summary:
Omnidian, the only nationwide supplier of residential and commercial solar system operation plans and cash-back energy ensures, acquired the business solar operations and maintenance (O&M) business from its associate PV PRO’s.
Since finishing this trade, Omnidian manages the performance of 1,300 megawatts (MW) of dispersed solar energy capacity, such as 200,000 solar homes — approximately 10 percent of residential solar PV from the U.S.
Two Key Themes:
1. Omnidian has been excellent raising capital to fuel its growth-via-acquisition strategy starting in 2015.
Over the course of 5 years is has raised at least 5 rounds of capital from Tier 1 financial and strategic investors Including Congruent Ventures along with Avista, City Light Capital, Blue Bear Capital, Ekistic Ventures and Energy Foundry and has put that capital to good work, now managing 10 of the residential market.
Interesting to see if an IPO is in the offing.
“This acquisition entirely aligns with our approach of using our specialist personnel and proprietary technology platform to encourage our clients and manage the performance of their residential and commercial solar systems, while leveraging an outside network of Field Service Partners for onsite repairs and maintenance. All existing PV Pros customers were migrated to our technology platform and client support team in less than a month. The transition of PV Pros customers to Omnidian was exceptionally fast and effective,”
Omnidian CEO Mark Liffmann
PV Pros, headquartered in New Jersey, provides nationwide Independent Engineering solutions for owners, investors, & financiers of solar PV and storage systems. “Our customers benefit from focused service providers,” explained PV Pros President Richard Ivins. “After working with Omnidian on many fronts, we realized their focused approach to solar performance programs and our attention on IE providers would deliver the highest overall degree of support and performance to our customers.”
Omnidian added business heavyweight Ben Compton as Vice President of C&I Strategic Alliances, Jesse Waters as Director of Commercial Products, and Jessica Gibbon as Client Success Manager. “Each of the industry vets were formerly with PV Experts and were instrumental not only in the transition, but also from the rapid growth of our commercial O&M pipeline,” explained Mark Liffmann.
2. The Opportunity for Consolidators, Investors and Regional Operators in the U.S. Solar Electricity O&M Market
The rise and development of solar O&M presents a chance for many regional solar Engineering, Procurement and Construction (EPC), electrical and energy services firms. The economic and logistical challenges associated with systems maintenance at a smaller scale have supplied an upstart to many middle-market providers.
This chance continues to introduce itself for local providers that could serve the immediate needs of customers –both within their locales and across different areas. Over 69GW of total installed solar capacity has been added across the U.S. throughout the previous couple of decades, with an extra 61GW anticipated to be deployed over the next five years.
This fragmented landscape across different market segments has enabled many contractors to profit from opportunities created by requirement on the part of quality solar PV EPC providers. Top global E&C providers, together with smaller solar-focused EPC contractors, have contributed to the expanding base of solar assets connected to the grid.
Just like any infrastructure asset, the continuing maintenance and operations is a critical component of long-term project achievement. But unlike a number of other longstanding types of infrastructure, the recent explosion of solar PV has created an operations and maintenance landscape that’s still in flux, particularly in specific sections.
This leaves a potentially valuable opportunity for present and prospective providers that–as the landscape begins to repay –can function significant market segments.
No matter what the market projects for growth, the assets in the ground (and those under construction) still need operations and maintenance (O&M) services. The long-term, recurring revenue stream on the backend might help insulate the fluctuations within an project-based revenue stream that is at the mercy of growth cycles. For businesses which do , the value of the complementary components can be greatest during times of muted building volumes.
The US O&M Solar Market is Still Highly Fragmented
Utility-scale PV asset ownership in the U.S. is equally significant, with the top 10 investors accounting for about a third of the strength pool based on net capacity. Consolidation is happening at a slow rate since the secondary marketplace for utility-scale PV assets at the U.S. remains constrained by the incentive structure.
For tax reasons, initial investors have a tendency to hold the assets until the Federal Investment Tax Credit (ITC) and accelerated depreciation benefits are fully accomplished (five to seven years).
The asset management landscape is more focused: the top players account for nearly 50 percent of their installed base. As in Italy, some big portfolios and assets are co-owned by two shareholders and managed by one of them. As an example, ConEdison Development and Sempra U.S. Gas & Power share ownership of many resources, such as the 250 MW Copper Mountain Solar 3 plantlife.
The O&M market reveals more immersion, due to three Chief factors:
- The utility-scale PV development market was historically dominated by vertically-integrated firms First Solar, SunEdison and SunPower, who are inclined to perform O&M themselves.
- Service providers SOLV and MaxGen grew very fast in the past 24 months and contributed to the market consolidation by aggregating large O&M portfolios.
- Very large plants are common in the U.S., and facilities over 75MWac are subject to NERC demands that just a small number of O&M suppliers are able to comply with.
We can expect further consolidation of the ownership and asset management arenas as secondary market activity rises, and of the O&M landscapes as a handful of large developers, EPCs and support providers compete to capture market share.
