Wikipedia says: An electricity purchase contract (PPA)… is a contract between two parties, one that produces electricity (the seller) and the other that wants to buy electricity (the buyer). No/Minimal Upfront Costs: A contract to purchase solar power offers an immediate payment for the host/energy consumer. As the developer handles all of the financing, procurement and installation, the customer simply goes to solar power and starts saving his energy bill as soon as the system is up and running. Don`t forget to follow YSG Solar on Twitter, Instagram, Facebook and LinkedIn for the latest news from the world of solar and renewable energy. Power Purchase Agreements (PPAs) may be appropriate: Cheaper energy: there are two typical price plans for a solar electricity sales contract and both result in energy savings for the customer. The first option is a fixed plan of escalators where the price of energy increases for the consumer with a predetermined rate – usually between 2 and 5%. This rate is generally lower than expected to increase the supply rate. The second option is a fixed-rate plan in which the price remains constant for the duration of the AAE. This saves a lot of money compared to the increase in supply rates compared to the previous year. Site: The solar designer is responsible for the entire installation process as well as all O-Ms after installation, but in some cases, the host may be forced to invest in his property to allow installation.
Kenya – Electricity Purchase Contract (AAE) – Simplified agreement for Kenya A relatively simplified electricity purchase agreement has been developed for Kenya`s electricity regulator for use in « Hydro, Geothermal or Gas » electricity generation facilities. It expects a capacity load and an energy load. The seller must sell all the net electrical power of the installation to the buyer. The Energy Regulatory Commission also provides a link to a PPP model for large renewable generators over 10 MW and an AAE for smaller renewable energy projects of less than 10 MW on its renewable energy portal. The solar designer benefits from AAEs by obtaining the revenues from this sale of energy to the consumer. In addition, as the owner of the solar system, the developer uses all tax credits, incentives or rebates related to the solar array. Naturally, the solar designer remains responsible for the system throughout its lifespan and takes care of the entire operation and maintenance. Depending on the specific electricity supply contract, a consumer may have a number of options at the end of the contract. The possibilities are an extension of the contract, the removal of the system and the purchase of the system by the developer. As the sun doesn`t shine all the time, many businesses will stay online. So they probably knew they still have power, but they get the advantage of using cheap solar electricity for much of the day.
The AAE is considered binding at the time of signing, also known as the reference date. Once the project is built, the validity date ensures that the buyer buys the electricity produced and that the supplier does not sell its production to others other than the buyer.  A core PPP between the Bonneville Power Administration and a wind power generation unit has been developed as a benchmark for future AAEs.  Solar PPAs is now being successfully used in the California Solar Initiative`s Multifamily Affordable Solar Housing (MASH) program.  This aspect of the success of the CSI program has only recently been opened up to applications.