Power Purchase Agreement

A power purchase agreement is a contract between two parties, one who generates electricity for the purpose (the seller) and one who is looking to purchase electricity (the buyer). The PPA defines all of the commercial terms for the sale of electricity between the two parties, including when the project will begin commercial operation, schedule for delivery of electricity, penalties for under delivery, payment terms, and termination. A PPA is the principal agreement that defines the revenue and credit quality of a generating project and is thus a key instrument of project finance. There are many forms of PPA in use today and they vary according to the needs of buyer, seller, and financing counterparties.

Read more about Power Purchase Agreement:  Background, Regulation, Where Appropriate, Financing, Operation and Metering, Example Contracts, See Also

Famous quotes containing the words power, purchase and/or agreement:

    ... whilst you are proclaiming peace and good will to men, Emancipating all Nations, you insist upon retaining absolute power over wives. But you must remember that Arbitrary power is like most other things which are very hard, very liable to be broken—and notwithstanding all your wise Laws and Maxims we have it in our power not only to free ourselves but to subdue our Masters, and without violence throw both your natural and legal authority at our feet ...
    Abigail Adams (1744–1818)

    O, let us have him, for his silver hairs
    Will purchase us a good opinion,
    And buy men’s voices to commend our deeds.
    William Shakespeare (1564–1616)

    There’s nothing is this world more instinctively abhorrent to me than finding myself in agreement with my fellow-humans.
    Malcolm Muggeridge (1903–1990)