A power purchase agreement is a long term contract to buy electricity directly from a generator rather than through a standard supply contract. For businesses with significant consumption and a long term view, a PPA can deliver price stability over ten to fifteen years alongside a genuine, traceable renewable claim.
PPAs are also complex, heavily negotiated documents where the commercial headline rarely tells the whole story. JSR Energy Consultancy advises on structure, negotiates terms and makes sure the agreement is understood in full before it is signed.
On site PPAs
In an on site PPA a developer funds, installs and maintains generation on your roof or land, and you buy the output at an agreed rate, usually below your grid import price. There is no capital outlay, but you are committing to a long term contract and to hosting the asset, which has implications for lease terms, roof works, insurance and any future sale of the property.
We review the tariff and its indexation, the availability guarantees, the treatment of surplus export and the end of term options including transfer of ownership.
Sleeved and virtual PPAs
A sleeved PPA connects you to an off site generator, with your existing supplier sleeving the power through to your meters and balancing the difference between generation and demand. You get a physical renewable supply and a defined price for the contracted volume.
A virtual or financial PPA works as a contract for difference against a reference price, settling financially while the certificates transfer to you. It suits businesses with sites across multiple suppliers or regions who want a single hedge rather than a physical arrangement.
The risks that need pricing
Volume risk sits with whoever has agreed to take the output, so a PPA that assumes higher consumption than you will actually have can leave you exposed. Shape and imbalance costs, the difference between when generation occurs and when you consume, also need to be understood rather than assumed away.
Credit, term length, change in law provisions, curtailment and price indexation all materially affect the value of an agreement. We model realistic scenarios rather than accepting a single optimistic projection.
PPAs and net zero reporting
A well structured PPA supports credible carbon reporting because the renewable attribute is traceable to a specific generator, which is stronger than a generic green tariff backed only by purchased certificates. Where reporting is a driver we make sure the contract delivers what your disclosure requires.
Getting started
We begin with a feasibility review covering your consumption profile, site suitability, appetite for contract length and reporting objectives. If a PPA is not the right answer we will say so and recommend a conventional renewable supply contract instead.