Power Purchase Agreements (PPA) is a hassle-free way for businesses to access solar energy without the upfront costs of installing a system. Instead of investing in solar panels, you rent your roof space and buy the electricity generated at a discounted rate. It’s a cost-effective way to enjoy the benefits of renewable energy while keeping your capital free for core business operations.
How does a PPA work? #
With a PPA, you commit to purchasing the electricity generated by the solar PV system installed on your site. Since we own and operate the system, it’s in our best interest to ensure it performs optimally, day in and day out, for up to 25 years.
We take care of ongoing maintenance, system monitoring, and any necessary repairs or replacements. You enjoy the savings and sustainability benefits. If, at any point, you decide you’d prefer to own the system outright, we can arrange a fair settlement and transfer ownership.
Zero installation costs – We design, install, and maintain the system at no charge to you.
Budget certainty – Protect your business from rising energy costs.
Instant savings – Start reducing your energy costs from day one.
Lower energy bills – Pay a fixed or discounted rate, typically 20–25% lower than standard grid prices.
Sustainability benefits – Reduce your carbon footprint and support ESG goals without capital expenditure.
The benefits of Power Purchase Agreements (PPA) #
We take care of ongoing maintenance, system monitoring, and any necessary repairs or replacements. You enjoy the savings and sustainability benefits. If, at any point, you decide you’d prefer to own the system outright, we can arrange a fair settlement and transfer ownership.
How does It stack up against outright ownership? #
Below is an example proposal, which outlines the key financials within a Power Purchase Agreement (PPA). Instead of a large upfront investment, the energy buyer benefits from clean electricity at a fixed or discounted rate, typically lower than standard grid prices. The renewable energy provider funds, installs, and maintains the system. Over time, this arrangement delivers cost savings, energy security, and sustainability benefits for the buyer, while ensuring a stable return for the provider.
Current Estimated Market Energy Price
29.70 p/kWh
Solar Generated Energy Consumed (Year 1)
470,058 kWh
Energy Price Savings (Year 1)
£62,341
Self-sufficiency Level
9.2%
Estimated Self Consumption
100%
Carbon Savings (Year 1)
103,413 kg CO2
Savings Over 10 Years
£472,527
Savings Over 25 Years
£2,399,115
Total Savings (Year 30)
£4,686,308
Understanding the pricing model and the savings predictions #
A PPA offers stability in an energy market known for its unpredictability. With fixed, transparent pricing, businesses can better plan their energy costs, avoiding unexpected grid hikes. Over time, the savings add up significantly, making a PPA an attractive financial and environmental choice.
Our approach to energy price forecasting #
Utilising data provided by Cornwall Insight*, we can predict that energy prices should show a steady return to levels of ‘normality’ by 2030. After this point, we can combine that prediction with historic energy price increases of an average of 8.3% (data provided by gov.uk* tracking the last 20 years of energy pricing).
We will happily admit that our savings modelling is precisely what we say it is, and that is an estimate. We’d be wrong to suggest that all predictions are modelled equally.
When compared with industry competitors, our numbers may be ‘worse’; what is meant by that is that our savings predictions might be lower. We don’t consider this worse; we consider this to be realistic based on the resources we collectively have on hand.
We see that most organisations use a strict percentage increase model and include a ‘presumed’ SEG payment. This provides a broad-stroke estimation but does not consider other factors impacting pricing beyond a primary price trend.
Our prediction model attempts to not only utilise this percentage increase model but acknowledges that we have left a period of high uncertainty and are making predictions that need to factor in various variables, such as market trends, economic indicators, and specific world events.
This granularity is our attempt to present a more precise projection, enabling businesses to make informed decisions and navigate potential challenges with greater foresight.
References
Historic Energy Pricing Data: https://www.gov.uk/government/statistical-data-sets/gas-and-electricity-prices-in-the-non-domestic-sector
Cornwall Insight Data: https://www.cornwall-insight.com/press/drop-in-power-price-predictions-up-to-2030-but-prices-to-remain-above-pre-pandemic-levels-for-next-decade
RPI Index Data: https://www.ons.gov.uk/economy/inflationandpriceindices   Â
Smart Export Guarantee Data: https://solarenergyuk.org/resource/smart-export-guarantee/
