View source for Power Purchase Agreement

== Definition ==
A '''Power Purchase Agreement''' (PPA) is a type of contract that allows an [[Energy Consumer]], typically large industrial or commercial entities, to form an agreement with a specific energy generating unit. 

A Power Purchase Agreement is a contract between a purchaser and supplier of electricity. The PPA contract itself specifies the commercial terms including: delivery, price, payment, etc.  The contract specifies details such as the volume of electricity to be placed on the grid and how much the consumer will take off.

PPAs generally guarantee a price for the electricity during the specified time period. In many markets, these contracts secure a long-term stream of revenue for an energy project (See [[Project Finance]]). In order for the consumer to say they are buying the electricity of the specific generator, attributes shall be contractually transferred to the consumer with the electricity.

PPAs cannot deliver [[Energy Attribute | electricity attributes]] that are different from the [[Grid]] average. The end user can acquire a [[Energy Attribute Certificate]] like a [[Guarantee of Origin]] in combination with the electricity contract. 

== References ==
* GHG Protocol Scope 2 Guidance (2015)

[[Category:Energy Accounting]]
[[Category:GHG Protocol]]
[[Category:Project Finance]]