Power Purchase Agreements (PPAs) are a complementary route to the market of renewable power generation - in addition to support schemes or to selling directly on the wholesale electricity market.
Fit for 55 Package will introduce frameworks to facilitate the uptake of PPAs. RED II draft amendment also promotes the use of credit guarantees to reduce these agreements’ financial risks. Such agreements will be strictly evidenced as National Energy and Climate Plans will indicate the volume of renewable power generation supported by renewables power purchase agreements.
Given the estimate that only 14% of industry PPAs’ demand is bankable it seems that RED II draft amendments on credit guarantees could really help to develop this market segment.