What is a PPA and what are the benefits?
There is growing interest from Australian businesses about entering into Purchase Power Agreements (PPAs). From schools to large-scale manufacturing businesses, PPAs present opportunities for organisations to benefit from lower long-term energy pricing, lower carbon emissions and better environmental credentials.
Entering a PPA with Nectr ensures a business’ energy is supplied by a large-scale renewable generation project in their state. Plus access to Commercial & Industrial (C&I) experts who understand the daytime energy pressures of big business.
But what is a PPA and how can it directly benefit my business? We’ve laid out all you need to know about PPAs to get started.
What is a Purchase Power Agreement?
A PPA is an agreement between a business or organisation and an energy provider for the fixed fee supply of electricity, often sourced from renewable sources such as solar and wind. A PPA is a contract for a fixed term period which typically ranges between 5 to 10 years.
What are the benefits of a PPA?
There are several business and environmental benefits to entering into a Purchase Power Agreement.
- Better electricity rates: PPAs enable businesses to negotiate an electricity price below its existing rates in exchange for a longer contract term. Currently, wind and solar are the cheapest forms of new electricity generation, and a PPA gives businesses direct access to these energy sources.
- Backing renewables: By taking out a PPA, businesses are directly supporting a specific renewable project, often located in regional areas. These projects not only provide clean power for the state but also support the local communities through job creation and infrastructure development.
- Price assurance: When entering into a 5 or 10 year Purchase Power Agreement, organisations have certainty in electricity rates for a fixed term. This ensures no bill shock and makes future budgeting more manageable and predictable.
- ESG Targets: For companies with a focus on achieving specific sustainability targets, entering into a PPA can support the goal of tapping into renewable forms of energy for electricity, reducing an organisation’s carbon emissions and taking positive action to protect the planet.
Who can join a PPA?
Nectr has a team of C&I experts who work with businesses and organisations across a variety of industries. Educational institutions such as schools, TAFE, Colleges, local councils, as well as commercial and industrial businesses in manufacturing, storage and distribution sectors can also benefit from entering a PPA.
To discuss Purchase Power Agreements (PPAs) for your organisation, contact Nectr’s Commercial and Industrial (C&I) experts to review your specific energy needs.
