Figure 3.

3 Global value of deals by corporate investors in energy technology

companies, by sector of investor
USD (2017) b illion
7

0
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

Oil and g as Utilitie s Transp o rt ICT Othe r e ne rg y Othe r

Corporate investment in energy technology start-ups reached a record USD 6.1 billion in 2017, but
energy company spending is dwarfed by that of ICT companies.

Notes: Includes seed, series A, series B, growth equity, loans, private investment in public equity and structured
debt. Transaction values are splits evenly between multiple corporate investors if information on relative shares
is unavailable. Excludes mobility services.
Source: Cleantech Group i3 database (2018).

There are several reasons large established companies provide capital to early-stage
technology companies. They might see it as a good investment on a purely financial basis,
but more commonly it is seen as an investment in learning about a technology, acquiring
human capital, and building a relationship with the technology owner that would smooth
the path to licensing or buying the technology if it is successful. In general, this approach is
used with technologies that are currently outside the core competence of the corporate
investor but that could add significant value to existing businesses if the market developed
in that direction. Given the value of innovation to many large energy companies, corporate
venture capital (CVC) finance and even growth equity (a type of private equity investment)
can cost less and involve less risk than developing a technology in-house. It can also shield
the developers from the strict evaluations placed on internal R&D projects that are
expected to scale up in existing business units. For a start-up company, a CVC investor can
provide access to know-how and customers that can give it a better chance of maturing
quickly.

Oil and gas CVC activity dropped between 2012 and 2015, but recovered significantly in
© OECD/IEA, 2018

2016 and 2017. A noticeable recent trend is a shift away from technology areas that
complement their existing infrastructure – such as bioenergy, CCUS and fossil fuel supply
technologies – and towards technologies that could complement their broader capabilities

204 3. Investment in R&D and new technologies