Signs keep mounting that the solar industry is on the upswing, the latest coming in the form of solar project developer Tioga Energy’s announcement that it’s raised $20 million in a second round of venture funding. The San Mateo, Calif.-based startup, which builds, owns and operates solar installations and then sells the power under long-term agreements, will use the funding to accelerate its pipeline of projects for commercial, government and nonprofit organizations. So far Tioga has focused its efforts mostly in New Jersey and a handful of Western U.S. states like California, but CEO Paul Detering tells us that the funding will help it expand into new markets like Massachusetts and Connecticut.
MEMC Electronic Materials, NGEN Partners, Nth Power and Draper Fisher Jurvetson participated in the round. The inclusion of MEMC, which designs and manufactures silicon wafers for the semiconductor and solar industries, is particularly notable as it could help Tioga build new relationships and access lower-cost solar products. Any price advantage Tioga can get on solar panels will help it compete.
Tioga won’t be the first solar project developer in which MEMC has invested. Last month, the wafer maker completed its acquisition of SunEdison for $200 million in cash and stock. MEMC CEO Ahmad Chatila said in a statement at the time that the deal would help drive revenue growth of MEMC’s wafer business as well as provide a recurring revenue stream from SunEdison’s solar-generated electricity. Beltsville, Md.-based SunEdison, which will continue operating as a subsidiary of MEMC, is one of the largest solar project developers in North America with 82.5 MW of PV power under management. While Tioga’s Detering wouldn’t comment on any possible acquisition by MEMC, the wafer maker has shown its appetite for project developers and a venture investment like the one announced today is certainly a good entry point for possible larger deals down the road.
Tioga, which has previously raised $14 million in venture funding, won’t say how many megawatts of solar power it has under management, how much it has in the pipeline or how much it expects to build in 2010. But Detering did say he expects the company to “resume a high growth rate” in 2010 after a relatively “flat” year in 2009.
The outlook for the solar industry is a positive one, especially among installers and financiers, which can take advantage of declining module prices due largely to the glut of products available. Market research firm DisplaySearch forecasts global solar demand will grow 38 percent in 2010, to 7.1 GW. That compares to the 14 percent contraction suffered in 2009, which total solar demand to just 5.1 GW.
Image of Tioga solar array in Danville, Calif., courtesy of the company