ERM Power is launching a new corporate renewable power purchase agreement (PPA) product to facilitate easier access to renewable energy sources for commercial and industrial customers.
ERM executive general manager trading David Guiver says this allows commercial and industrial businesses to buy a partial interest in the output of a large renewable power station, to support their business and environmental energy objectives.
“Working through ERM Power, businesses can enjoy the benefits of a PPA without the intricacies of negotiating and managing a complex contractual arrangement directly with a renewable energy provider,” he said.
Mr Guiver said many large corporates were committed to moving to 100 per cent renewable energy, given sustainability targets and continued volatility in the wholesale markets.
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“PPAs are an increasingly popular option, but businesses must proceed cautiously if negotiating these directly, as there may be hidden pitfalls,” Mr Guiver said.
“Our new product helps businesses secure exposure to renewable energy generation as part of their energy mix in a way that’s simple, transparent and efficient.”
In Australia, PPA contracts will typically be for the purchase of large-scale generation certificates (LGCs) and the energy revenue produced by a renewable energy generator for a typical term of 15 years.
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With ERM Power’s offering, for an agreed fixed price, businesses will receive a percentage of the energy revenue and the LGCs generated by the renewable operator, with the LGCs more closely aligned to their mandatory requirements.
Customers can choose their level of participation in increments of 5 per cent and have the added flexibility of a three-year agreement. ERM Power has the ability to aggregate multiple business customers to gain access to large PPAs, opening up opportunities that haven’t necessarily been available to smaller business customers.
ERM Power will handle all aspects of the PPA on behalf of customers including sourcing the project, negotiating the terms and conditions and managing financial settlements, providing customers a peace-of-mind commercial arrangement.