Power Purchase Agreements

Deliver agreements that advance vertical integrated utilities with additional power generation capacity in power purchase agreements

Attend this two-day programme to:

Understand the complexity of power purchase agreements to assess the impact for your business
Evaluate your current power purchase agreements and position yourself to influence the stakeholders involved.
Broaden your knowledge of power purchase agreements on a global scale to evaluate opportunities
Review the maturity of the agreement steps to map out progress
Identify what enablers for robust power purchase agreements are available to support your development
Grasp the complex aspects of these agreements to manage your risk
Review to what extent the power purchase agreements will be beneficial for various market conditions
Boost your practical knowledge through actual case studies taken from real-life scenarios
Find the best solution to improve your stance in a power purchase agreement scenario that will best suit your operation of interest

What is the programme about?

The global trend of the electricity sector moving from government controlled monopoly services to liberalized market places creates a highly complex regulatory scene, where all technical, operational, regulatory, market interfacing and commercial requirements for long-term basis should be captured in the Power Purchase Agreement. There are different models for power purchase agreements. The earlier models are evolving to cover diverging generation types and the increasing technical complexity required to operate and dispatch generation capacity of renewable and dispersed micro generation. Power Purchase Agreements can be done in many ways, subject to the priority of the requirements.

This course has been specifically developed to guide you through the process of negotiating and drafting these complex agreements. It will highlight different structures, content and financing. Review the key challenges faced in the context of current agreements, provide you with robust understanding the commercial, financial and legal considerations.

All those involved in setting up power purchase agreements. Participants include:

Network operators
Governments and regulators
Renewable power suppliers
Large power users
Independent power producers
Banks and financial institutions
Consultants
Market operators

DAY 1

MODULE 1 – OVERVIEW OF ELECTRICITY POWER PURCHASE AGREEMENTS TYPES

The structure of the electricity supply industry – variations of power purchase agreements

Evolution of the power purchase agreement
Regulation of the power purchase agreement
Variations of power purchase agreements
Power purchase agreements and what the benefits are

Practical case study: Power purchase agreements and associated electricity market regulation from four different countries

The power purchase agreement role and objectives of electricity network regulation

The role and benefits of an independent economic regulator
The regulator as a proxy for a competitive market
Promotion of investment
Allowing investors freedom to manage their own risks and returns
Maximisation of economic efficiency
Taking into account social considerations and government policies

The power purchase agreement and the stakeholders

Identification of the stakeholders for power purchase agreements
What should and should not be comprised in long-term power purchase agreements?
Subsidy schemes and the impact on power purchase agreements
Environmental regulation, economic outlook, government credit rating, taxation
Feedstock delivery agreements and responsibilities
Supply guarantees and contractual commitments in power purchase agreements

Practical case study:Power purchase agreements stakeholder mapping

Power purchase agreement types

Base generation, renewable, dispatch able
Subsidy impact on power purchase agreement
Impact of co-generation deliveries from power generation source, district heating, desalination
Capacity payments versus free market
Spinning reserve
Supply guarantees and contractual commitments in power purchase agreements

Incentive based power purchase agreements

Efficiency regulation
How to encourage efficient operations
CO2 regulations, politics, incentives
Who should share benefits from improved efficiency
The role of efficiency benchmarking

Practical case study: Efficiency based Power purchase agreement development identification

DAY 2

MODULE - DETAILS OF ELECTRICITY NETWORK REGULATION

Power purchase agreements and forecasting robustness

Forecasting demand short term, and non controlled power generation supply gap
Capacity payment ratio versus power supply payments – adapting fossil generation to reduced operation.
Forecasting energy usage as a component of forecasting of revenue
Forecasting demands for maintenance undertaking
Forecasting capital and operational expenditure
How to assess forecasts

The power purchase agreement and financing

Power purchase agreement for competitive bidding processes
The relevance and importance of regulated cost of capital in electricity network regulation
How to determine the cost of capital
Benchmarking of operational costs
Renewable guaranteed off take pricing

Practical case study: Renewable impact on power generation market in Europe, how to not repeat

Interfacing challenges for the establishment and services for a generator for the power purchase agreement