And PPA for self-consumption a Electricity purchase contract in English it is a long-term electricity purchase contract. It is normally signed with renewable energies, mainly solar or wind, and allows the signatories to know ahead of time energy costs for the next 7 or 10 years, or even longer.
In this type of agreement install solar panels without investment economically, one party is responsible for the design, processing, financing, installation and operation of the power generation plant. While the other agrees to buy the generated energy, or part of the total, during the time period established in the contract.
When we talk about a self-consumption PPA, these contractual commitments take place on the spot: a photovoltaic solar self-consumption installation is carried out on the roof or land of a company or industry that is the other party, consuming solar energy. energy generated. That is: electricity is generated and consumed in the same location.
After installation, the company that operates the self-consumption plant is in charge of selling the energy generated and consumed to the other company, at a price previously agreed in the contract. In this way, the changes that occur in the price of electricity on the market are avoided, thus improving profitability of solar energy for companies.
In addition, the price can be set in various ways, although the most common is to agree on a fixed price per kilowatt hour (kW/h) consumed, which represents savings over market prices.
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What are the advantages of a PPA for self-consumption?
These long-term renewable energy PPAs have a number of advantages over other options self-consumption in companies or houses.
summarizes them for you as follows, bearing in mind that in Traditional PPAs off sitepower plants are far from the place of final consumption and where the energy passes through the network
Greater economic savings the longer it lasts
Self-consumption PPAs can they have a duration between 10 and 25 years and the longer the validity period set by the signatories of the agreement, the greater the savings can be in relation to energy market conditions and electricity prices, which can vary greatly over the years.
More energy savings
The second of the benefits of PPAs in self-consumption is a greater savings in terms of energy Why self-consumed energy is not subject to taxes or fees for the use of the electricity transmission or distribution network.
Savings turn into investments
Third, these long-term power purchase contracts turn savings into investment. This is possible because when the term of the current contract expires, the customer can extend the contract to have much higher economic savings or also purchase the solar PV installation as their own.
This is a very advantageous way, therefore, to finance a solar installation for self-consumption with no initial cost and adapted to consumers.
Characteristics of long-term electricity purchase contracts
In this final part, explains the most important features of self-consumption PPAs.
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1.- 100% renewable solar energy
Focusing on solar PV, it is a 100% renewable, clean and inexhaustible energy because it does not run out with consumption. Unlike what happens with polluting energy sources like coal or oil.
2.- Prior agreement on the price of energy
This feature can also be included in the section on the advantages of self-consumption PPAs, since these long-term power purchase and sale contracts allow Price the generated energy in advance and consumed in the same location. Thus, as mentioned before, price fluctuations in the market are avoided and it remains constant in the long run.
3.- No initial economic investment is required
Signatories to self-consumption solar PV PPAs do not have to pay an initial economic investment, but at we can take care of everything.
4.- Immediate discount on the electricity bill
Fourth, get a immediate discount on the electricity bill due to the consumption of self-generated photovoltaic solar energy.
5.- Savings of up to 25% on bills
In addition, from the moment the solar installation is put into operation, there is a savings up to 25% in invoices.
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6.- Improving environmental sustainability
Solar PV in all its varieties, including if a PPA is involved, is a improving environmental sustainabilityas independence is gained from more polluting methods of electricity and power generation.
7.- Revaluation of real estate assets
Seventh, on an economic level, there is a revaluation of real estate or real estate in which the solar installation is made. This fact is beneficial, for example, to reevaluate a building in case solar self-consumption in homes.
8.- is responsible for maintenance and management
Finally, the signatories of this type of agreement do not have to go through red tape or worry about the maintenance of the installation, as at we take care of it before, during and after the actual installation.
In short, in the field of solar self-consumption in Spain, long-term power purchase and sale contracts have several characteristics and advantages to consider. Both economically and environmentally, they are one more step in decarbonizing society and generating clean energy electricity to get much-needed energy sooner rather than later. energy transition.
Finally, here is a video from our partner and business developer at , Pablo Torres at Infoenergética, explaining in more detail the benefits and possibilities of a self-consumption PPA.
