Energy Storage Power Station Asset Repurchase Terms

What is a proxy storage power purchase agreement (PPA)?

We propose a contractual setup, the proxy storage power purchase agreement (PPA), to foster the deployment of energy storage technologies. We define a threshold price below which the PPA becomes financially attractive for PPA buyers. We compute the threshold price for several storage technologies and configurations, in seven European countries.

What is a long-term Power Purchase Agreement (PPA)?

At its core, a PPA is a contract between an energy generator (often a renewable energy producer) and an energy buyer (typically utilities or large-scale energy consumers).

Does a power purchase agreement contain a lease?

The use of Power Purchase Agreements (PPA) in the supply of renewable energy is on the rise. Typically, the customer in a renewable wind and solar PPA does not have the right to control the underlying equipment and, therefore, such an arrangement does not contain a lease.

How are energy contracts similar to proxy storage PPAs?

Energy contracts are similar to proxy storage PPAs because they are only based on day-ahead market revenues and the seller is responsible for the operation of the storage asset. However, the revenues of energy contracts are based on the actual operation of the asset and perfect foresight does not apply.