What Is a Solar PPA?
A solar PPA is an arrangement in which your business allows a company to install a solar system on the property. Instead of leasing or purchasing the system, the business owner only pays for the power they use. PPAs range in length, but they can be as long as the lifetime of the panels on the building.
How Does a Solar PPA Work?
With a solar PPA, instead of purchasing the solar panels, the customer doesn’t have any responsibility for the panels. They’re owned by a company that installs and maintains them. Generally, these prices are below the price of electricity from the company’s utility provided.
How Much Can You Save With a Solar PPA?
Power prices can fluctuate regularly, which makes it hard to say exactly how much you’ll save with a solar PPA. However, most arrangements are set up so that you do save money, otherwise there would be few advantages to the recipient of the power from the solar panels. The amount you’ll save is also going to be based on how much electricity you use, how much the panels will generate, what your agreed rate is and what other fees are involved. This is why you should consult with several different companies before choosing a PPA provider so you can find the best deal for you.
PPA Benefits
- No upfront costs- Not having to fork over thousands to pay for a solar system is hugely beneficial, meaning you can reinvest that money into your business.
- Certainty – You know exactly how much your power will cost. Your PPA will outline your per-wattage power cost, so you know exactly how much you’ll pay, no matter what else is happening. If your power costs have been fluctuating a lot, this certainly can be a comforting thought.
- No Risk – You assume very little risk for the system. If the system you’re using has problems, the owner is responsible for repairs and replacement of faulty parts. It’s nice to know that the solar system you’re using is not your problem if things go south.
Is a Solar PPA Right for You?
For some businesses, a solar PPA is the right move. If you’re interested in solar power, reducing emissions and securing a fixed rate for 10+ years, then a solar PPA makes sense. Just be sure that you fully understand all the terms of the contract.