Power purchase agreement
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Sustainability - renewables - electricity.
(PPA).
A contract between an electricity generator and a buyer for the sale of green electricity between the two parties.
Potential benefits of power purchase agreements include:
- Providing a fixed price for energy over the period of the contract;
- Managing exposures to energy price volatility; and
- Enabling more predictable cost planning.
This type of contract is sometimes known as a direct PPA, to distinguish it from a Virtual PPA.
See also
- Additionality
- Asset finance
- Corporate finance
- Distribution
- Existing asset
- Gas purchase agreement
- Green
- Infrastructure
- Integrated water and power plant
- New build
- New-to-earth asset
- Offtaker
- Plant
- Project finance
- Recourse
- Renewables
- REGO
- Sleeving
- Solar CSP
- Solar PV
- Sustainability
- Transmission
- Transmission and distribution
- Virtual PPA
External link
Introduction to Power Purchase Agreements - UK Crown Commercial Service
