Products for Clean Energy Buyers

Power Purchase Agreements for renewable energy offer corporate energy buyers the opportunity to pursue two laudable goals: (1) doing good by reducing their environmental footprint, and (2) doing well by reducing the impact of energy cost uncertainty on their business.

Unfortunately, traditional Power Purchase Agreement contract structures often leave corporate buyers holding large financial risks that they don't want and can't manage. REsurety's products and services for corporate energy buyers were developed to bridge the gap between what corporate PPA buyers want and what traditional PPAs offer.

Volume Firming Agreement

The timing and quantity of energy consumed by a manufacturing facility or data center are known. The timing and quantity of energy generated by a wind farm are not. 

As a result, how well a renewable PPA protects a corporate buyer's P&L against energy costs depends on a volatile ingredient: the weather. A Volume Firming Agreement enables corporate renewable energy buyers to eliminate the generation intermittency risk in their PPAs. Combined with the original PPA, a Volume Firming Agreement provides corporate buyers with certainty in their future energy consumption costs.  

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PPA Settlement Guarantee

Many corporate buyers don't have exposure to the wholesale energy market risk that their PPAs were intended to protect against.  For some, near-term contracts with their utility or retailer have locked in an energy price. For others, facility relocation means their load - and energy cost exposure - no longer exist in the market where they signed their PPA. For these PPA buyers - those without the underlying energy cost risk - a PPA is no longer a tool to reduce risk. Instead, it is a speculative bet on future grid, commodity market and weather conditions.

Was it windy in Oklahoma?  You might owe money.  Was a nearby coal plant unexpectedly shut down?  You might receive money.  Did natural gas prices fall? You might owe money.

For corporate PPA buyers who do not want to hold speculative exposure to those kinds of risks, the PPA Settlement Guarantee enables certainty in future PPA settlement cash flows. For a single, fixed annual payment to or from the corporate PPA buyer, the uncertainty of future PPA settlement gains and losses can be eliminated.

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Proxy PPA Settlement

In a traditional PPA, the buyer takes on financial exposure to how the project is ultimately built and operated. The value of PPA settlements are partly a function of decisions made by the project's owner: What turbine model is selected? When and how is maintenance scheduled? What O&M commitments are negotiated?

Holding risks that depend on decisions made by the project owner has two impacts on a PPA buyer: (1) it can result in misaligned interests, and (2) it can make it impossible, or at least expensive, for PPA buyers to manage the risk of their PPA settlements in the future.

Proxy Generation settlement is a service REsurety provides to insurers and corporate entities alike, enabling them to contract with clean energy projects without having to take on exposure to how the project chooses to operate. 

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