ERM Power launches Corporate PPA offering
New product helps businesses efficiently lock in renewable generation 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.
“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,” said Executive General Manager Trading David Guiver.
“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.”
Mr Guiver said many large corporates were committed to moving to 100% renewable energy, given sustainability targets and continued volatility in the wholesale markets.
“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.
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% 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.
Mr Guiver said the new product was a natural evolution for ERM Power, building on the company’s commitment to supporting the development of renewables infrastructure in Australia.
ERM Power has entered into offtake agreements with developers of wind and solar farms and has also launched new-generation financial instruments into the wholesale market to support developers of renewables infrastructure.
Mr Guiver says ERM has been actively working with customers to incorporate renewable PPAs into their energy procurement strategies, to support business, social and sustainability targets.
To support the new product, ERM Power is calling for expressions of interests from renewable project developers and asset owners with projects located within either Victoria or New South Wales, connected to the NEM, with an installed capacity of 10MW or more. Uncontracted and partially contracted assets interested in offtake agreements for a 3-5 year term are being encouraged to respond.
Parties interested in participating should email firstname.lastname@example.org to obtain further information, with formal expressions of interest due on or before 10 May 2019.
For further information
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About ERM Power
ERM Power is an Australian energy company operating electricity sales, generation and energy solutions businesses. The Company has grown to become the second largest electricity provider to commercial businesses and industrials in Australia by loadi. A growing range of energy solutions products and services are being delivered, including lighting and energy efficiency software and data analytics, to the Company’s existing and new customer base. The Company operates 662 megawatts of low emission, gas-fired power stations in Western Australia and Queensland.
iBased on ERM Power analysis of latest published information.