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Power Purchase Agreement (PPA) | Solar Services Agreement (SSA)
Overview

PPA/SSA Defined:

A contract for the purchase of the solar energy (kWh) or the services within obtaining energy from that solar energy system from the owner of the system (usually a special purpose entity/LLC) to the consumer of the power (offtaker/customer).

    COMPONENTS OF A CONTRACT

    LENGTH

    Typically a contract is 20-25 years, with the option to buy-out after year 6 (additional terms can apply)

    Typically a contract is 20-30 years, with the option to terminate (buy-out) after year 6 (additional terms can apply).

    PAYMENT TERMS

    How often the special purpose entity (SPE) will be paid, the penalty for non-payment, dealing with disputes, taxes, etc..

    PROJECT CONSTRUCTION

    Information on a reasonable timeline and materials expectations for completion of construction.

    PRICING

    Amount paid (or rate) for the electricity to be paid by the offtaker/customer to the special purpose entity (SPE)/LLC over the length of the contract. This can often include escalation rates, which match or are less than historical increases in utility electricity rates.

    The rate (amount paid) for the electricity to be delivered to the offtaker/customer by the SPE over the length of the contract. This often includes escalation rates, which are usually less than historical increases in utility electricity rates.

    SYSTEM INFORMATION

    This includes size, location, anticipated first-year production, description, modules, inverters, and utility provider.

    BENEFITS OF A PPA | SSA

    PPA/SSA
    Leasing
    Buying

    Little to No Upfront Capital

    No Performance Risk

    No System Expertise Required

    No Maintenance Required

    No Purchase Required

    STRUCTURE OF A PPA | SSA

    ADDITIONAL INFORMATION