Power Purchase Agreement (PPA) 101
A Power Purchase Agreement (PPA) is a legal contract between an electricity generator and a purchaser of energy or capacity (power or ancillary services). Such agreements play a key role in the financing of electricity generating assets. Under the terms of a PPA, the PPA provider typically assumes the risks and responsibilities of ownership when it purchases, operates, and maintains the turn-key facility. By clearly defining the output of a generating asset and the credit of its associated revenue streams, a PPA can be used by the owner of the asset to raise non-recourse financing [1] from a bank or other financing counterparty. [2] [3] Commercial PPA Providers such as SunEdison , MMA Renewable Ventures , Solar Power Partners , and Recurrent Energy are enabling businesses, schools, governments, and utilities to benefit from predictable, renewable energy through a PPA. Other Solar Electricity Providers include SunRun , Solar City , Tioga Energy . Source Wikipedia