After reporting on developments in the Waste Management & Technologies (E5) sub-sector in the last quarter, this edition of Sector Report focuses on Renewable & Alternative Energy (E1), with a particular emphasis on renewable energy developers and independent power producers (IPPs).

Against the backdrop of the EU's Affordable Energy Action Plan (AEAP), which comes into force in the second quarter, the renewable energy market is experiencing new momentum. The aim of the AEAP is to reduce energy costs, decouple electricity markets, and remove regulatory barriers to investment in clean energy. The measures range from guaranteed minimum remuneration to support instruments for grid infrastructure and simplified approval procedures. These policy decisions not only create better conditions for energy suppliers, but also increase the attractiveness of companies along the renewable energy value chain – especially for investors.

One example of this development is the recently announced acquisition of Italian energy supplier ACEA Energia by Plenitude, Eni's clean tech subsidiary. The deal shows how strategic players are expanding their involvement in the IPP and electricity distribution business to benefit from improved regulatory conditions. It also demonstrates the increasing relevance of the AEAP as a driver of M&A activity.

Valuations in the sustainability sector remain largely stable in the second quarter of 2025, but show a slight downward trend. The Renewable & Alternative Energy (E1) sub-sector also continues to move sideways, following the general pattern of the overall market in the sustainability sector.

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