Solar Power Purchase Agreements Provide:
- Predictable Energy Prices
- Lower Energy Prices
- Zero Upfront Costs
- No Operational Responsibility For Businesses Regarding Panels & Units
- Simple Scalability Potential
- A Sustained Contingency Connection To The Grid
- And Much More
From the outset, an efficiently planned solar PPA is a fantastic option for businesses looking to capitalise on the renewables revolution while cutting their electricity costs considerably from day one. Originally conceptualised to be an incentive for businesses and residences to consider renewable sources of electricity, the notion has since evolved into a cunning business strategic move that commercial enterprises across the country have factored into their everyday offsets and budgets.
This blog article will cover the essential facts and parameters of solar PPA agreements, and what makes them suitable for businesses and commercial entities looking to reduce their carbon footprint and capitalise on renewable energy.
Definitions & Breakdowns of Solar PPA
The long-term contract between a retailer and purchaser can be construed as a retailer fronting up the costs for the installation, maintenance, and setup of a PV system on a commercial property. The resulting energy production is then sold back at a set rate to the business that is hosting the panels – this is typically at a heavily discounted c/kWh rate (compared to traditional grid power usage).
As these contracts are for long periods of time (typically between 5-30 years), the set price for electricity is incredibly appealing, especially for businesses that operate during daylight hours and benefit the most from energy production.
At the end of the contract, the ownership of the panels and system will revert back to the business which exponentially increases the upside for the long term.
Why Would A Business Consider Solar PPA?
Businesses that elect to enter a solar PPA will have immediate upside from the first day of connectivity. Oftentimes buying a system outright can be costly for smaller businesses – this is where commercial solar PPA providers like 13KUGA come into the fold. We offer transparent terms that leave no stone unturned when it comes to the schedule of delivery, buyout schedule, and operational timelines.
There are numerous types of businesses and enterprises that would benefit from this type of contractual arrangement from universities/schools to trade enterprises. Appealing mostly to companies that are looking to:
- Commit to a reduced carbon footprint
- Lock in energy costs for the foreseeable at an optimal rate
- Reduce their risk of operational fees and structural maintenance of the systems
As the high cost of electricity causes unnecessary strain on businesses and households across the country, these contracts are becoming more lucrative and strategically sound than ever before. The simultaneous benefit of harnessing the affordability of renewable energy with diminished responsibility for operational costs and maintenance woes is an enticing one in the current climate.
Invest In Your Future
As the market will face challenges in the years to come, hedging your business’ interests as early as possible is the optimal route and the logical avenue of approach for a more sustainable future.
Ultimately, any commercial solar set-up is beneficial for the planet and your enterprise’s bottom line. Utilising the latest technology to harness energy from the most renewable source on the planet is a no-brainer in our estimation, especially when you consider the carbon footprint reduction, the reduced cost of electricity, and the long-term advantages of cutting energy costs. Whether it’s bought outright, leased, or organised through a solar PPA – your business will see the upside.