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Commercial Solar Topic: What is PPA? A Power Purchase Agreement (PPA) is a financial arrangement where a fund manager installs, owns, and operates a solar power system on a customer's property. Here's how that works: 1. Agreement: The customer agrees to purchase the electricity generated by the solar system at a predetermined rate, usually lower than the local utility's rate. 2. Cost Savings: The customer benefits from reduced energy costs without the upfront expense of buying and installing the solar panels. 3. Maintenance: The developer is responsible for the installation, maintenance, and operation of the system, ensuring it runs efficiently throughout the agreement period. 4. Duration: PPAs typically last 10 to 25 years. After the term ends, customers can extend the agreement, buy the system, or have the equipment removed. 5. Environmental Impact: By entering into a PPA, customers contribute to reducing carbon emissions and promoting renewable energy usage. Which in most cases is top of their priorities when seeking to retain or gain new contracts for production or distribution. PP is advantageous for both parties: the customer enjoys cheaper and cleaner power, and the developer profits from the sale of the generated power! It’s a win-win!

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