PPA Solutions by Pexapark – From Pricing to Life Cycle Management and Risk Reporting
As the renewable energy sector continues to grow, an increasing number of investors are eager to embark on new projects involving the construction of wind or solar farms. Power Purchase Agreements (PPAs) have become a widely adopted instrument to ensure a return on investment for such projects. A PPA is a complex contractual agreement structured to facilitate the sale of power at a predefined price or pricing formula and that outlines the amount, timeframes, penalties, and other delivery conditions. PPAs are not limited to wind and solar power production but are also used for various other production types, including hydro or nuclear. However, it was the wind and solar investment boom that gave birth to the prominence of PPAs.
PPAs are structural contracts spanning typically from one year to up to 20 years. For investors and renewable power producers, especially those who are not experts in renewable energy markets, it is challenging to calculate a fair price, quantify all associated risks, and develop effective hedging strategies for such contracts. This is where Pexapark comes in.
Pexapark is dedicated to supporting the growth of renewables and provides customers with PPA reference pricing in addition to software tools for PPA deal analysis portfolio and risk management so they can actively manage the full deal lifecycle and mitigate risks. Their PexaQuote product provides daily updated reference prices for PPAs across 19 European markets based on market conditions, PPA structure, technology, time horizons, start dates, and tenors. Additional features allow Investors to calculate, and study expected PPA prices for specific assets based on technical specifications and specific geo-location information, PPA configurations or, for example, estimate the impact of incorporating battery storage. This information supports investors when negotiating a PPA contract.
Furthermore, with the PexaOS product, the company supports PPA portfolios throughout their lifecycle. By considering various environmental factors, production data, and regulatory conditions, the system can calculate risks and revenues, run market scenarios, and evaluate hedging strategies. The system is using a wide range of input data such as SCADA data, forecasts, market data, and grid data, it validates and utilizes the data in the in-house created models to provide risk valuations and positioning, scenario analysis, as well as financial reporting, tracking cash flows, budgeting, and liquidity planning.
Lastly, the company offers an extensive range of advisory and educational services. Pexapark offers PPA Academies, which are especially useful for market players introducing green assets to their existing portfolios and potential investors who are not typically involved in the energy business.
Pexapark is strongly growing Swiss company as Debbi Bavin from Pexapark marketing explained me. The company have recently secured €20m additional funding, she added. The company plans to expand geographically and support renewable IPPs, funds and asset managers in more regions.
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