Power Purchase Agreements (PPA)

More and more industrial companies want to produce in a more environmentally friendly way. The trade sector is also developing increasingly sustainable business concepts. The supply of green electricity is a key factor in making business more climate friendly. GETEC ENERGIE supports commercial energy consumers in finding the green electricity product that makes the most sense for them. Large consumers have the option of buying sustainable electricity directly from the producer - with the help of Power Purchase Agreements (PPA).

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Sustainable energy supply with power purchase agreements

Direct electricity supply contracts, also known as Power Purchase Agreements (PPAs), are an attractive way for industrial companies and other commercial energy consumers to purchase green electricity. PPAs enable transparent traceability of the origin of the green electricity purchased, which is particularly important for companies with high sustainability goals in order to maintain their credibility. This transparency is possible either through own generation facilities or by purchasing under a PPA. If the generation plant is located close to the point of purchase, the sustainability efforts become more tangible and can be expanded to include regional aspects.

Green electricity from EEG-20Plus-systems saves resources

PPA wind power in Germany often comes from so-called EEG-20Plus-plants. This means that the plants are no longer subsidized after 20 years of funding and their operators have to look for alternative marketing channels. OTC contracts between operators and commercial electricity consumers such as PPA can be an ideal solution for both sides. By using wind turbines that are no longer subsidized, they can continue to operate economically and do not have to be dismantled. This saves valuable resources that would be needed to build new wind turbines. Consumers obtaining electricity from these old plants can thus implement sustainability on an additional level.

ESG-reporting obligation: PPA make a valuable contribution to reducing scope 2 emissions

As part of the ESG reporting obligation, companies must provide information on their scope 2 emissions, among other things. This refers to the CO₂emissions resulting from purchased energy. The chart on the right shows that the scope 2 share of total emissions can vary greatly from sector to sector. ESG reporting companies must also submit their plans for reducing their corporate carbon footprint. The purchase of green electricity is an essential part of reducing CO₂ emissions. In the form of PPA, the use of sustainable electricity is particularly valuable and can be presented convincingly in an ESG report.

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PPA enable planning and supply security

Another advantage of PPA that should not be underestimated is the long-term planning security and fixed prices that a PPA offers both electricity consumers and system operators. Especially in times of major price fluctuations on the energy markets - think back to the summer of 2022 - reliability has become another convincing argument for procuring green electricity via PPA. Renewable energies not only play a central role in the decarbonization of the economy, but are also an important component of security of supply.

PPA for green hydrogen

Hydrogen may only be labeled as green in the EU if the electricity used comes from a dedicated generation plant that is directly connected to the electrolyser. Alternatively, the green electricity for electrolysis may also be purchased via a PPA. In this case, it must be ensured that one hundred percent of the green electricity used comes from the contracted generation plant.

More information for operators of electrolyzers

Supply and greening of remaining residual quantities

Adjusting the electricity consumption of industrial companies or other commercial consumers to the generation profile of wind or photovoltaic systems is often a challenge. We trade residual quantities on the spot market for you to ensure your full supply. Surplus electricity from the PPA is sold, while the guarantees of origin (GOO) are retained and can be used for additionally procured quantities. Own generation plants can generate GOO and increase the proportion of green electricity. Surplus quantities can be used in the portfolio for other locations in order to reduce demand on the spot market. Consumers with a 100% green electricity target can select guarantees of origin with corresponding quality standards for a small amount of remaining gray electricity.

Many advantages, high complexity

Despite all the advantages described, PPA remain complex contracts - often too complex to function as an actual bilateral agreement. GETEC ENERGIE provides support with structuring a PPA. Tasks such as forecasts or balancing energy risks cannot be managed by either plant operators or electricity consumers. Also, finding the right PPA partner is often difficult, as supply and demand usually do not match. As an aggregator, we can help to bundle offers, which is particularly advantageous for consumers with high energy requirements in order to reduce complexity.

We maintain long-term relationships with system operators.

Through our direct marketing subsidiary GEWI, we maintain long-standing relationships with operators of photovoltaic and wind power plants. This enables us to optimally match supply and demand. Thanks to our direct commercialization subsidiary, we can reliably supply the high demand for PPA.