Solar Power Purchase Agreements
There are several ways that a commercial organisation can obtain solar energy, however not all options are equal and vary in cost, volume of output and the degree of control that the business owners have over their operations. The method we suggest, is through a solar power purchase agreement.
WHAT IS A POWER PURCHASE AGREEMENT?
A solar power purchase agreement is a financial agreement between a solar company and a business, whereby the solar company pays for the installation of the PV system, in exchange that the recipient agrees to pay for the electricity produced by the system for a certain length of time. The price paid (measured per kilowatt) is less than what the recipient is/would be paying for electricity.
A solar power purchase agreement allows businesses to install a solar system, without having to pay a massive sum upfront and still achieve a cheaper energy bill.
Power purchase agreements are long-term contracts, usually ranging between 10-20 years and have penalties/conditions for early termination. However, whilst the contract is in effect the solar company is responsible for any maintenance costs and for ensuring the system is in good working order.
HOW IS AN AMANDA ENERGY POWER PURCHASE AGREEMENT DIFFERENT?
Amanda Energy does power purchase agreements a little differently to other solar companies, in that once the contract has come to the ends of its term, the customer is transferred the ownership of the solar PV system. This offers our clients a significant benefit, as many competing solar companies will either remove the system at the end of the term or seek to extend the contract.
On top of this, Amanda Energy clients are also given the option to end the agreement by purchasing the system at any time for the depreciated value. This is beneficial for those who would rather own their solar system but don’t have the capital initially or for those who would like to try before they buy.
Read more about Amanda Energy power purchase agreements here.
BENEFITS OF HAVING A POWER PURCHASE AGREEMENT
- No (or low) upfront capital costs – the solar provider will pay for any upfront costs regarding design, sizing, procuring and installing.
- Reduced energy bill – the agreed upon price of the solar power per kilowattage will be cheaper than traditional electricity.
- Limited risk – as the solar provider is responsible for the performance and maintenance of the system.
- Potential increase in property value – buildings with PV systems have shown to increase the overall property value.
- Environmental sustainability – PPAs are one of the fastest and most economic ways to give back to the environment.
If you would like to know more about what a power purchase agreement is, what it entails and how it could benefit your business, contact Amanda Energy today. Our solar managers are always available to discuss your options for renewable energy solutions, power purchase agreements and other payment methods.