The need for certainty of supply, a buffer against price volatility and the continued growth of renewable energies which are lowering prices are driving significant growth in the corporate PPA market. A PPA gives a corporate enhanced energy security, ROCE and a competitive advantage.
What is a "Corporate PPA"? (Power purchase agreement)
A PPA is a contractual energy supply agreement directly between a corporate industrial end-user and an energy producer. Generally we distinguish between the so-called "direct" and "virtual" corporate PPAs. In "direct" corporate PPAs electricity actually produced in the installation is supplied to the consumer, while in so-called "virtual" corporate PPAs electricity supplied to the industrial consumer does not necessarily come from the production installation.
In Europe there is a divergence in legislation which acts as a brake and a barrier to wider expansion, but is this about to end as a consequence of the 'Fourth Energy Package' negotiations?
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