Clean energy strategies can miss true carbon emissions avoided if they’re based on regional and annual averages, Power Finance & Risk reported May 10 in a story by Taryana Odayar.
Texas crisis illustrates how hourly generation during high-priced hours spells the difference between big wins and big losses for clean energy buyers and sellers.
First used with wind projects, a pgPPA manages weather-related risk by settling a facility’s energy transfer based on a proxy generation index, rather than on actual metered generation. Operational risk shifts from buyer to seller.
“We were delighted by the contribution [vPPAs] made to our sustainability goals but were frustrated by the financial volatility of the settlement payments and the limited ability we had to predict or manage that volatility,” wrote Kenneth Davies when he was director of energy portfolio management at Microsoft. Working with insurer Allianz and analytics firm REsurety, Davies came up with solutions including the proxy generation PPA, the volume firming agreement and the settlement guarantee agreement.
Data management company Iron Mountain has layered additional hedge contracts onto virtual power purchase agreements that it signed with two wind farms in 2016 and 2017 as it seeks to mitigate various risks associated with the popular renewable energy contracts. REsurety provided the valuation and risk analytics for the transactions, and will serve as calculation agent for tracking and settlement over the lives of the contracts.
REsurety helps Iron Mountain limit its exposure to variable weather and power markets, to achieve both sustainability and financial goals while investing in offsite renewable energy.
Taaleri Energia announces the use of a 10-year Proxy Revenue Swap for its 336 MW Texas wind farm. REsurety provided risk analytics supporting the transaction, with the substantial majority of the power to be contracted under the PRS.
Scout Clean Energy reaches commercial operations at Heart of Texas. REsurety provided risk analytics to support a Proxy Generation PPA for the project.
Map-based SaaS tool provides unprecedented transparency and insight into clean energy markets, illustrating today how COVID-19 has impacted renewable projects and driven record-setting low prices.
Hedging structure allows Scout Clean Energy to manage risks associated with weather and price variability for its Heart of Texas wind farm.