Falling prices for renewable power and rising corporate sustainability goals have led more Fortune 500 businesses to directly buy green electricity. The trend started a few years ago, and 2015 may see the largest number of deals yet.
With nearly 750 MW of new power purchase agreements (PPAs) announced through the first quarter, 2015 is on track to surpass last year’s banner demand for 1300 MWs of new generation.
While terms for these PPAs vary, the seller typically develops, owns, and operates the renewable facility, and the buyer agrees to purchase the plant’s output at a negotiated price for an agreed term (typically 15-to 20 years). This type of long term commitment has put off many prospective renewable power buyers, however, because they lack the resources or risk tolerance.
That is one reason why RPD has developed medium term (3-10 year) PPAs for green power. RPD can offer shorter terms by sourcing power from a mix of existing and new facilities that are not fully subscribed. RPD’s arrangements still help to finance additional renewable projects but they don’t require the customer (ie. the end user of the power) to foot the whole bill for each project. The costs are spread over several off-takers.
Please get in touch if you’d like to learn more about how RPD can help your company switch to green power.