What Is A Solar Ppa Agreement

What is a solar power purchase agreement ppa.

What is a solar ppa agreement.

It allows a developer to design finance and install a solar pv system on a client s property. Simply put you get clean solar electricity at a predictable rate. In fact a ppa is a lease option. A power purchase agreement is an agreement wherein a solar company covers much of the cost of installing a solar system on your home and then simply charges you for the energy produced.

The main differences between the two are that at the end of your contract ball and chain you have the ability to purchase the system at a fair market value price once your 20 year agreement ends. A ppa is fully funded solar pv model with no or low upfront costs which offers reduced energy costs and the opportunity for long term savings. A solar power purchase agreement ppa is a financial agreement where a developer arranges for the design permitting financing and installation of a solar energy system on a customer s property at little to no cost. With a solar ppa we install solar panels on your home and sell you the solar power it produces at a lower rate than what your utility can typically provide.

A solar ppa is very similar to the solar lease option. A power purchase agreement ppa or electricity power agreement is a contract between two parties one which generates electricity the seller and one which 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. Lease and ppa terms vary greatly by state and by installer so explore multiple options to ensure. Leasing solar panels with a power purchase agreement ppa a recent development in the solar financing industry was the creation of a power purchase agreement wherein a financier finances the installation and the homeowner pays them in return over 20 years through a new kwh payment structure.

The structure of your agreement will vary slightly depending on the type of solar lease ppa you choose. The idea is that the homeowner doesn t have to pay for the system upfront but can still benefit from decreased utility bills. In return the developer sells the generated energy back. Solar leases and solar ppas come with 0 down prepaid and custom down payment options and are available to consumers in about 25 u s.