Competitive solar energy through power purchase agreements (PPA)

Clean Energy,Projects,Sustainability — The meeco Group on November 1, 2018 at 14:02

meeco provides clean power investment without any upfront costs

Companies and private consumers in many regions worldwide have to cope with an unstable or highly expensive energy supply due to the unreliability of the grid or even the total absence of such a power supply. This involves, especially for companies and industries, a heavy disadvantage in terms of competitiveness on the global market. Paused production lines in manufacturing industries, interrupted cold chains in food factories or electrical breakdowns in office buildings are just a few examples how power cuts can cause substantial losses for the commercial sector and constitute a serious threat to their commercial success accordingly. Many companies rely on a diesel-based energy supply and suffer from high and unpredictable fuel and maintenance costs. Utilising solar (photovoltaic) technology is much more eco-friendly and cost-effective. The contractual framework of a power purchase agreement (PPA) offers all advantages of clean energy to long term predictable low prices with limited or no upfront capital expenditure (CAPEX) costs for the company.

 

What is a Power Purchase Agreement?

A power purchase agreement (PPA) is a contract between two parties: the seller (provider), who generates and sells electricity, and the buyer, who purchases the energy accordingly. The energy provider covers the majority part or even all investment costs for the engineering, procurement and construction and also the operating costs of the solar power plant and sells the generated energy at a fixed price to the purchasing party. This contract is closed for a certain period of time, usually more than ten years, and stipulates several other details for the energy delivery.

 

The circle of a Power Purchase Agreement in an easy way.

 

What are the benefits of a PPA?

PPA entails various advantages: the energy consumer benefits from a reliable energy supply based on renewable and clean power sources (driven by the reliable reoccurrence of the sun every day passing through our skies) and also increases the availability of the energy supply when including energy storage facilities or additional energy generation appliances such as diesel generators. Prices for the electricity are contractually agreed and mostly independent from the price volatility of the national grid or fossil fuel.

All benefits at a glance:

 Climate protection can be financially promoted by the government

CO2 emissions will be substantially reduced

Companies can express corporate environmental responsibility by utilising clean energy

Clean energy at a fixed price for years

Independence from the national grid and its prices » save money

 

As experienced EPC contractor meeco and its international subsidiaries realised several PPA projects. To name just one example, we installed a 350 kWp solar plant with the local food processing company Seasons Food in Lahore, Pakistan, which had to face power outages on a regular base. Within the framework of a PPA, we installed a solar sun2live rooftop solution for the whole building. Ever since, Season Food purchases the generated power at a fixed rate and secures a reliable and interruption-free power supply.

 

Read more about IRENA Innovation Week where The meeco Group participated.

meeco will enter the clean energy market in Madagascar. Read the full story here.

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