Carbon project developer financing levels on track with last year
Investment in carbon project developers and portfolios continues to experience strong momentum in 2023, according to Abatable’s analysis of carbon market financing and deals data from the first half of this year.
Key H1 2023 insights
More, albeit smaller, deals
The number of funding deals reached 109 in H1 2023, which compares to a total of 70 deals for the entirety of 2022. This means 2023 is already set for a record high in terms of number of deals (see chart below). However, the median investor check size has significantly dropped – from $50mn in 2022 to $6.2m in H1 2023. This is the result of a smaller number of carbon fund closing announcements relative to last year and an increased number of VC-led engineered removals rounds, with the latter tending to be smaller in terms of equity. The dispersion of check sizes has narrowed significantly so far in 2023. Most deals have been in the range of $1mn to 40mn, with very few exceptions above $50mn. This suggests the voluntary carbon market is still maturing to welcome large institutional capital funding injections.
