A Power Purchase Agreement (PPA) is a long-term contract between an electricity generator and a buyer (offtaker) for the sale of electricity. In a Physical PPA, the generator supplies power directly to a specific location on the power grid, and this energy is then transmitted to the offtaker's energy account. The agreed-upon price for the duration of the PPA is typically fixed, providing price stability for both parties.
Key aspects of a Physical PPA include:
Physical PPAs are commonly used by large energy consumers seeking to secure a reliable and consistent energy supply, often from renewable sources, to meet sustainability goals and manage energy costs effectively.
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