Baker McKenzie has advised leading global medicines company Novartis on five virtual power purchase agreements (VPPAs) with three developers expected to add more than 275 megawatts of clean power to the electrical grid.
These projects are expected to address Novartis greenhouse gas emissions across its European operations over a period of 10 years from the start of operations, equivalent to removing approximately 113,000 passenger vehicles from the road annually.
The Firm provided advice to Novartis throughout the process, from the procurement and evaluation of offers for developers through to term sheets and the development of the VPPA documentation.
A VPPA is a long-term contract between a developer of renewable energy project, and an interested energy buyer. Under the agreements, wind and solar electricity will be generated from six renewable energy projects being developed by three different providers – Acciona, EDP Renewables and Enel Green Power. All projects will be located in Spain. The projects are expected to be constructed and come online by 2023 and aim to address the company’s carbon footprint across its European operations. Schneider Electric, a global specialist in energy management, acted as advisor in the project.
"We have been working with Novartis and Schneider Electric since the inception of this fantastic project, helping Novartis realise its goal of making renewable energy solutions a cornerstone of its strategy for reducing emissions," said partner Marc Fèvre. "This transaction underlines the market-leading nature of our global and European renewable energy and corporate PPA practice, working on the largest, first-of-their-kind cross-border PPAs such as these, which are milestones shaping the market and helping companies meet their sustainability goals and decarbonize their supply chains.”
A cross-border Baker McKenzie team was led by London partner and co-head of the Firm’s renewables group, Marc Fèvre, assisted by Graham Richmond, Saskia Volhard and Lewis Malkin, working with a team in Madrid led by Antonio Morales and Jorge Gomez, and Ansgar Schott in Zurich.
Baker McKenzie has long pioneered the development of Corporate PPAs, having released numerous global reports over many years as PPAs have become increasingly popular and sophisticated products across multiple industries as a means of achieving sustainability-related goals.
Major corporate PPAs Baker McKenzie has advised on include:
- ALDI on two Corporate PPAs. An agreement with RATCH Australia provides for 19.4% of the electricity and green products (such as the certificates earned under federal regulations by the use of renewable energy) generated by the 227MW Collector Wind Farm in NSW. A second agreement, with Tilt Renewables, provides for 6% of the electricity and green products generated by the 336MW Dundonnell Wind Farm in Victoria.
- Lead counsel to a consortium of AkzoNobel, DSM, Philips and Google in contracting for 100 MW of renewable power in the Netherlands with respect to wind farm Krammer under a corporate PPA arrangement - a first of its kind in Europe.
- Cummins, Inc. in connection with the negotiation and execution of a synthetic power purchase agreement for the electrical output to be provided by a 75 MW wind energy project in Indiana that will be constructed, owned and operated by EDP Renewables North America LLC, a subsidiary of EDP Energias de Portugal.