[RE-wrenches] Sample Power Purchase Agreements

[Randy]

Carl,
At Solar Power 2008, Stoel Rives, a law firm had a booth and they were
giving out a free workbook guide on PPA terms and conditions. They also
offered this publication on their website which I downloaded, but I
couldn't find the link just now. So, if you would like the guide let me
know offline and I will send it to you.
 
Good luck.
Randy
 
Randy Sadewic
Positive Energy
 
Office: 505 424-1112
Cell:    505 570-0137
-----Original Message-----
From: re-wrenches-bounces at lists.re-wrenches.org
[mailto:re-wrenches-bounces at lists.re-wrenches.org] On Behalf Of Matt
Lafferty
Sent: Monday, December 15, 2008 9:55 PM
To: 'RE-wrenches'
Subject: Re: [RE-wrenches] Sample Power Purchase Agreements
 
Hi Carl,
 
Actual PPA contracts are rather complex instruments. To start with, the
PPA is actually a contract between the PPA Provider/System Owner (think
of this as the "bank") and the Host Customer. These are the parties that
will have the enduring relationship because, under a PPA, the Host
Customer pays the System Owner for the electricity generated for many
years. A 3rd party integrator (I'm guessing that's your role) doesn't
generally end up with a direct contractual relationship with the Host
Customer. Basically, you end up working for the System Owner and maybe
getting a "finder's fee". In some cases, the PPA provider will pay you a
finder's fee and have their preferred installer(s) do it. It's also
common for the integrator to never see the actual PPA contract that gets
executed either way. 
 
Each PPA provider has their own requirements and standard contracts.
Some offer "buy-outs" and some don't. Some offer both. Some offer longer
terms than others. Some have severe "early termination" clauses and some
don't. Some "pay for" or "credit back" environmental credits and some
just take them and say that's why their rate is as low as it is if
asked. Etc. The requirements vary by state as well. This is an extremely
short list of the many variables that go into the structure and costs of
a PPA. They aren't exactly generic, if you know what I mean.
 
I know it sounds like a good idea to show them a sample, and in
principle it is. If you have to do this, I suggest that you find a PPA
provider(s) that you want to do business with and will feel good about
leaving the non-profit in their hands, first. Get a sample from them. It
will have their boilerplate in it, which is what you really want to show
the customer.
 
It gets really sticky later when they call you up during the
negotiations (which you aren't involved in unless you have a consulting
arrangement) and they ask you why the contract they are being asked to
sign is so much different than the sample you originally showed them.
I've seen numerous deals fall apart for reasons just like this. Simple
matter of trust. The Host Customer ends up feeling like they can't trust
anybody involved and ends up not going solar at that time.
 
An alternative is to contact a public agency in your neck of the woods
who has signed up for one of these and see if you can get a copy of
theirs. Freedom of information and all.... Beware of this route for the
reasons stated above, but at least it's easier to explain because they
are a government agency, yada yada yada.
 
No matter what sample you show them, make sure you are clear that it's
ONLY A SAMPLE and the final version WILL be different. Depending on what
you show them and who they end up dealing with as a PPA provider, the
differences can be huge.
 
Best of luck!
 
$02001,
 
Matt Lafferty
gilligan06 at gmail.com
 
 
 > I'm interested in sample PPAs.  I'd like to set one of these up for a
local non-profit customer and would appreciate any examples, etc you are
willing to share

With REgards
Carl Adams
NABCEP Certified Installer 
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