U.S. Renewable Energy M&A: Review of 2023 and Outlook for 2024

March 22, 2024

Relative to previous years, a higher cost of capital, influenced by both base rates and widening lender margins, will continue to put pressure on project viability and investor returns. Smaller developers, which are more affected by elevated rates and more susceptible to increased cost and delays, may be forced to sell projects, portfolios, or their entire platform as they seek liquidity or an outright exit. Investors and established incumbents with stronger balance sheets may take this opportunity to invest, acquire and structure creative solutions, further driving consolidation in the sector. Finally, we anticipate corporates continuing to take a more active role in the energy transition. As decarbonization and electrification come to the forefront, oil and gas players will continue to actively invest in the sector, while technology companies may take a more direct approach to investing in the energy transition as they seek to realize ambitious decarbonization targets.