S&P, Pexapark partner to create new PPA benchmark

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The new benchmark aims to bring better transparency and risk assessment in the renewable energy markets. Image: Photosol.

S&P Global Commodity Insights has partnered with renewables advisory firm Pexapark to create a new power purchase agreement (PPA) benchmark.

Together the two companies will create daily price indices that aim to bring improved transparency and risk assessments in renewable energy markets by combining Platts’ benchmark expertise with the advisory firm’s pricing references of PPAs across European markets.

The joint development of renewable energy price indices will facilitate the growth of PPAs as it will create benchmarks for the market with Pexapark providing evaluated prices for PPAs in solar and wind, according to S&P Global.

Price volatility in Europe has put under constraints PPA market with solar prices raising up to 38% this year, peaking at €105.99/MWh (US$110.3/MWh) in 12 May and currently at almost €90/MWh and with countries like Spain and Germany obscuring huge cannibalisation risk, according to a report from Pexapark published in June.

Alan Hayes, head of energy transition pricing at S&P Global Commodity Insights, said: “This new family of renewable energy indices will combine the independence and methodology rigor of Platts benchmarking processes with Pexapark’s established price data, technology and expertise in this growing and important sector.”

Earlier this year, PV Tech Premium sat down with Pexapark to discuss about the volatility of European energy markets and how this might affect long-term PPAs.

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