2017

The Rise of Corporate PPAs

red wind turbines

The corporate renewable power purchase agreements (PPAs) market is growing significantly.

In the US alone, almost 1.6 GW of renewables capacity was contracted through corporate renewable PPAs in H1 2015, compared to just 650 MW between 2008 and 2012.

The Rise of Corporate PPAs - A New Driver for Renewables outlines the economic and environmental advantages of corporate renewable PPAs and takes a closer look at some of the biggest deals recently completed by corporates such as Amazon and The Dow Chemical Company. It also examines both standard and synthetic PPA structures.

With more than 40 percent of Fortune 500 companies now having targets relating to renewable energy procurement, energy efficiency or cutting greenhouse gas (GHG) emissions, it’s clear there is a real appetite for going green within the business world. And corporate renewable PPAs are set to be one of the most popular methods for meeting these targets.

Key findings

  • Corporate renewable PPAs are surging around the world.
  • Early entrants into the corporate renewable PPA market were some of the largest IT/C companies in the world but recently the market has seen a new set of very diverse businesses including retailers, pharmaceuticals and industrials entering into corporate renewable PPAs.
  • The primary motivation behind corporate renewable PPAs is economic, with green/sustainable advantages as a runner up.
  • The benefits of corporate renewable PPAs to offtakers and generators are huge, but careful consideration needs to be given due to the unique risks and structural complexity common to these deals.
  • Financing renewable energy projects with corporate PPAs is more challenging than financing projects with standard utility PPAs due to the often lower credit ratings of corporates, corporates' more frequent fluctuations in power demand, collateral allocation and other issues.

>> Download The Rise of Corporate PPAs: A New Driver for Renewables

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