PPAs: What are the options?

F&S Energy’s customers range from 30kW up to a few MW in size. Since its founding in 2011, F&S has witnessed rapid market growth. Initially, the Feed-In Tariff scheme incentivised landowners to install renewable generation. More recently, volatile energy prices and declining renewable costs have caused another surge in renewable generator installations.

Farmers are also increasingly turning to renewable energy to diversify income streams, enhance sustainability, reduce running costs, and contribute to environmental conservation. Where there is an excess of generation, this can be sold to an electricity supply company through a PPA for additional revenue.

Power purchase agreements (PPAs) are contracts between electricity generators and electricity supply companies, for the sale of electricity.

There are several types of PPAs available from F&S:

Fixed price: A fixed price PPA where F&S calculates a price per kWh exported. The firm would then pay this fixed rate for all power exported over the course of the contract.

Track and fix: This tracks the electricity market with the value from the exported power passed through to the generator, with an option to lock in to a fixed price at any time during the duration of the contract.

Wholesale pass through: The industry benefits associated with each generator are passed through and all power generated is sold at an index linked price. This approach can provide the greatest returns for a generator over the longer term, but the generator takes on the risk, and returns fluctuate over the short term according to wholesale energy price movements.

Peer-to-peer (p2p) trading: P2P trading is an approach that enables customers to buy and sell electricity directly with other customers. F&S Energy facilitates P2P trading relationships, offering a platform for farmers to trade renewable energy efficiently.

With P2P farmers can maximise revenue by selling electricity directly to consumers and achieve better prices compared to traditional sales, the company says. The online portal facilitates people making matches. Either by registering and using the portal yourself, or signing an LOA which gives F&S Energy the authority to register and make the best match possible on your behalf. There are no admin fees included. Engaging in P2P trading also shows electricity consumers exactly where their electricity is coming from.

Visit the F&S Energy website for more information

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