Standardisation a ‘long way off’ from solving the ‘gulf’ in corporate PPA understanding

Facebook
Twitter
LinkedIn
Reddit
Email
Source: Solar Media.

The corporate power purchase agreement (PPA) market is currently struggling from a “large gulf” in understanding that standardised contracts could solve, but the industry is still a “long way off” from introducing them.

A panel at this week’s Solar Finance and Investment conference in London discussed the scope of post-subsidy developments throughout Europe, including the potential for long-term corporate PPAs to help projects receive financing in the absence of stable, subsidy-backed revenues.

This article requires Premium SubscriptionBasic (FREE) Subscription

Try Premium for just $1

  • Full premium access for the first month at only $1
  • Converts to an annual rate after 30 days unless cancelled
  • Cancel anytime during the trial period

Premium Benefits

  • Expert industry analysis and interviews
  • Digital access to PV Tech Power journal
  • Exclusive event discounts

Or get the full Premium subscription right away

Or continue reading this article for free

With merchant risk and wafer-thin margins unlikely to trigger much interest from financial institutions, and many energy utilities favouring short-term PPA contracts, there has been an expectation that PPAs with bankable corporate counterparties will be a source of growth for the solar sector moving forward.

However, there has yet to be a tangible, significant movement towards corporate PPAs and this week’s panel discussion concluded that this is predominantly down to a “large gulf in understanding” of such agreements.

Abid Kazim, formerly of asset holder NextEnergy Capital and now MD at asset manager Wise Energy, said that solar developers and corporates were not necessarily speaking “the same language” in most cases.

He went on to discuss how there is also an issue regarding contract structure and length. While most debt structures for projects are in advance of 10 years in length, most corporates and energy management professionals are bound to lock-in energy costs at five or seven years at a time, rendering it difficult to find a middle ground in negotiations.

Other members of the panel, including BayWa r.e.’s Benedikt Ortmann and Solarcentury’s Peer Piske, mooted the possibility of standardisation in the field, wherein an acceptable template of a PPA contract could be introduced by the industry, in close collaboration with corporate groups, in a bid to establish some common ground in negotiations.

Standardisation in contracts has long been sought after in other areas of solar, most notably in O&M, but Richard Slark of Poyry, another participant in yesterday’s discussion, argued that standardisation was a “long way off” and there were no “quick wins”.

This was substantiated by a poll of the audience, which found that a significant majority – more than 80% – considered utility companies to be the source of most PPA interest for the solar sector, with just 10% arguing that destination to be corporate customers.

That poll triggered another point of discussion led by the panel’s chair, Chris Hewett of the Solar Trade Association, who mentioned the potential for public sector entities to emerge as potential counterparties for PPA-backed projects.

Lars Quandel, head of energy and infrastructure at HSH Nordbank, suggested the same – that local authorities could become a great area of interest for solar developers moving forward – but Slark argued that the risk of political upheaval could be a thorn in the side of projects moving forward. Unlike with corporate PPAs where the long-term bankability of the offtaking organisation is scrutinised, with local authorities it was suggested the issue could be one of change in political situations as a result of local elections.

25 November 2025
Warsaw, Poland
Large Scale Solar Central and Eastern Europe continues to be the place to leverage a network that has been made over more than 10 years, to build critical partnerships to develop solar projects throughout the region.
2 December 2025
Málaga, Spain
Understanding PV module supply to the European market in 2026. PV ModuleTech Europe 2025 is a two-day conference that tackles these challenges directly, with an agenda that addresses all aspects of module supplier selection; product availability, technology offerings, traceability of supply-chain, factory auditing, module testing and reliability, and company bankability.
10 March 2026
Frankfurt, Germany
The conference will gather the key stakeholders from PV manufacturing, equipment/materials, policy-making and strategy, capital equipment investment and all interested downstream channels and third-party entities. The goal is simple: to map out PV manufacturing out to 2030 and beyond.

Read Next

October 6, 2025
German solar inverter manufacturer SMA Solar will cut 350 jobs in 2026 as it adapts to the “weak” residential PV market.
October 6, 2025
An expert panel has identified a series of grid failures that led to April's unprecedented power outage in Spain and Portugal, ruling out renewables as the leading cause.
October 3, 2025
SunStrong Management has raised US$900 million to refinance a 'large portfolio' of residential solar assets developed by SunPower.
October 3, 2025
Chinese government policies and supply-side production cuts will drive a significant increase in solar and storage component costs.
October 2, 2025
Spanish waste management company Trabede and energy firm Greening Group will build a solar module recycling plant in Granada, Andalusia, Spain.
October 2, 2025
The European solar sector will lose around 5% of its jobs in 2025, the first contraction in employment for the sector in nearly a decade.

Subscribe to Newsletter

Upcoming Events

Solar Media Events
October 7, 2025
Manila, Philippines
Solar Media Events
October 7, 2025
San Francisco Bay Area, USA
Solar Media Events
October 21, 2025
New York, USA
Solar Media Events
November 25, 2025
Warsaw, Poland