Venture capital funding in the Smart Grid sector halved last year according to new figures.

A report by analysts at US clean tech consultants Mercom Capital found that venture capital funding in the market was worth $377m in 2011 against $769m a year earlier.

Raj Prabhu, managing partner at Mercom, said: “Venture capital funding in Smart Grid was anaemic at best in 2011. Even though the number of transactions was about the same as last year, the average deal size dropped in half.”

However, the number of investors in the market rose, pointing, said Prabhu, to continued interest in the market but a “lower risk appetite” to heavily invest in it.

The sector also saw strong merger and acquisition activity, led by major players such as Siemens, Schneider Electric, ABB and GE.

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