Solar financing - Power Purchase Agreements (PPAs)
A solar Power Purchase Agreement (PPA) can enable you to have a solar power system while minimizing cash flow impact. Solar Power Purchase Agreements also allow for a fair market buy out at the end of the term.
Like any capital facilities investment, a solar power system can require a significant upfront cash outlay for property owners. But with a PPA, your business, government, or non-profit organization can benefit from solar energy immediately while minimizing cash flow impact.
A Power Purchase Agreement is a long term agreement where your business or organization agrees to purchase all of the electricity generated by a solar system at a contracted rate. The PPA provider installs, maintains, and operates the solar system – you only pay for the power that is generated.
Typical Features of Solar Power Purchase Agreements (PPAs):
- Power Purchase Agreements require no upfront investment, and typically have a term of 20 years.
- The PPA provider monetizes all tax benefits and incentives, and incorporates them into a lower electricity rate.