cPPAs (corporate Power Purchase Agreements) are one of the global energy trends.
It is a formula designed for entities wishing to use energy directly from renewable energy sources. With an extensive portfolio of our very own RES projects, we can offer our customers this modern form of energy contracting. As RES do not depend on future coal and gas prices, they can help secure costs.
The agreements range from 5 to 15 years.
The contract is signed directly between the electricity producer and the consumer (buyer) and specifies the amount of energy to be supplied, the prices for the transactions, the forms of settlement and the duration of the cooperation.
The contract secures energy costs over a long time horizon.
The use of energy from RES is one of the criteria in ESG reporting, the fulfilment of which translates into opportunities for company growth, access to finance and expansion of markets.
The cPPA has the benefit of securing the revenues from the power plant over a long time horizon, allowing the project to receive financing.
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The cPPA is signed by the electricity producer directly with the consumer, i.e. the buyer.
For the consumer, the agreement secures energy costs over a long time horizon, which is particularly important in the current era of dynamic energy price fluctuations.
The conclusion of the cPPA is also important from the perspective of EU’s climate policy and ESG reporting. This term (to give it the full name – Environmental, Social Responsibility and Corporate Governance) encompasses criteria to assess whether companies operate in a socially responsible and environmentally sustainable manner. Meeting these criteria has an increasing impact on the growth potential of companies, financing accessibility as well as market expansion. More and more companies expect to work with companies that use green energy, helping them decrease carbon footprint in their supply chains.
The cPPA has an added value of securing revenue from the power plant over a long time horizon, thanks to which the project can receive financing and the source can be actually built.
cPPAs determine matters connected to the amount of energy supply, transaction prices, settlement methods, as well as the aforementioned term of cooperation.
At Projekt Solartechnik, we specialise in supporting customers with a comprehensive energy purchase strategy taking into account cPPAs.
The flexibility to prepare provisions that are tailored to the needs of both parties and the lack of standardisation means that PPAs can vary widely.
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