PPA Benefits

The benefits of the PPA model continue to increase as the commercial solar market matures and the financing market becomes more liquid:

No Up-Front Financial Committment

  • Development and contruction risk/cost financed by the service provider/developer
  • Client makes no upfront payments and monthly utility style payments only due once the project is "in-service"

Outsource Design/Development Complexity and Ongoing Maintenance 

  • Larger scale solar projects require careful design and engineering to ensure good fit with customer needs - electricity demand patterns, location of the site, utility tarrifs, solar module and inverter availability and system configuration need to be taken into consideration
  • Operations and Maintenance (O&M) agreements ensure the efficient long-term management of the site
  • Aligned interests - service provider has vested interest in ensuring system works at maximum efficiency for the life of the solar array 

Hedge Against Rising Energy Prices

  • PPA's can extend for up to 25 years, thereby enabling the customer to lock into energy prices
  • Significant flexibility available around price escalators

Contract Simplicity

  • PPA documentation becoming more simple/established - customers purchases 100% of electricity for a pre-determined period (10-25 years) at a negotiated price
  • Only other significant document (for the customer) is a ground lease to enable the PPA provider to build and operate the on-site solar array