European power purchase agreement (PPA) prices fell 0.6% between July and August this year, according to Swiss consultancy Pexpark.
In the first of the company’s ‘Pexapark Brief’ reports – a bi-weekly update that is replacing its old monthly ‘PPA Times’ reports – it notes that its EURO Composite tracker for PPA prices reached €48.78/MWh at the end of August, down from €49/09/MWh at the end of July.
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This fall was sharpest in Poland, which saw average PPA prices fall 2.9% month-on-month, and France, which saw PPA prices fall 2.5% over the same period. Pexapark suggests this is tied to lower prices for coal contracts in Poland, in particular, which impacted energy prices across what it called a “thermal-heavy power mix” in Poland. These declines were not reflected in Germany, however, where average PPA prices increased by 1% between July and August.
While the consultancy has not yet published composite figures for September, it notes that the pace of new PPAs has increased significantly. Europe signed just nine PPAs in August, for 450MW of capacity, compared to 12 deals already completed in the first three weeks of September. These deals cover 421.3MW of capacity, suggesting that September’s contracted PPA capacity will be at least on par with those of August.
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Solar power featured prominently in both months, with a 150MW solar deal signed in August, and a 100MW offtake agreement for solar power signed in September, each month’s largest deal by contracted capacity. Indeed, solar accounts for half of the deals signed so far in September.
This pace of dealmaking is a slowdown over the 1.4GW of capacity contracted in June, but a significant increase over the 178MW of capacity contracted in May, and is more in line with the capacity contracted in the early months of the year. However, both August and September 2024 saw higher volumes of capacity contracted, with 474MW and 1.1GW, respectively.
