Power Purchase AgreementsEnergy monitoring & targeting is essential for good building energy management
A power purchase agreement (PPA) or electricity power agreement, is a contract between two parties, one which generates electricity and one which is looking to purchase electricity.
Onsite electricity generation can come from many different sources, but the most common ones are Solar PV, Biomass CHP and Gas CHP systems. It is generally more viable if 100% of the energy produced can be used on site, but this isn’t always the case, and with the introduction of commercial battery storage recently we are seeing a higher requirement for organisations to sell any excess energy back to the grid.
The market has evolved over the years and today there are many different forms of PPA available which vary according to the needs of buyer, seller, and financing counter parties.
PPA contract terms can vary also but can run anywhere between 5 and 20 years.
A power purchase agreement, or electricity power agreement, is a contract between two parties, one which generates electricity and one which is looking to purchase electricity.