Power Purchase Agreement (PPA)
A PPA, short for ‘Power Purchase Agreement’, is a commonly used term for the feed-in agreement for the energy production of a sustainable energy installation. All conditions regarding the sale of the produced green electricity to the energy supplier are regulated by this contract. In addition to a compensation for the kilowatt hours, this contract also includes agreements on the price of the Guarantees of Origin (GOs).
Cost prices of renewable energy technologies have fallen in recent years. As as a result, the corresponding basic amount in the Dutch SDE subsidy scheme also shows a downward trend every year. For operators and initiators, this automatically means a lower contribution from the Dutch enterprise agency (RVO), which means that the income from the so-called PPA is becoming increasingly important in the business case. The Power Purchase Agreement is therefore an important part of financing and achieving Financial Close of a sustainable energy project.
Concluding the power contract
Pondera supports operators and initiators in requesting, negotiating and concluding a PPA in the Dutch market. We are happy to tailor our services to the needs of the customer. Examples of this service are:
- examining the current or new PPA (second opinion);
- testing the implementation of PPA in a business case;
- guidance in the tender process;
- taking care of the PPA tender;
- negotiating the conditions;
- working out the power contract with the supplier based on the outcome of the negotiations.
Next to PPAs for Dutch renewable energy projects, Pondera is also becoming increasingly familiar with and experienced in negotiating and analysing PPAs in other energy markets and on other continents.
If you have questions about PPAs or Guarantees of Origin or if you are looking for guidance in your search for a suitable PPA for your sustainable energy project, we would be happy to assist you.