Power Purchase Agreements (PPAs)
What is it about?
Power Purchase Agreements (PPAs) are contractual arrangements between electricity producers (frequently renewable energy generators) and buyers. By providing renewable electricity at mutually agreed rates, these contracts foster stability for both parties and promote the adoption of renewable energy sources (RES).
The Electricity Market Design (EMD) Regulation introduces measures to promote PPAs as long-term instruments for ensuring price stability and promote the deployment of renewable energy sources.
ACER has been tasked to assess whether the introduction of additional voluntary PPA contract templates is needed to foster the transparency, efficiency and integration of the European internal energy market.
Power Purchase Agreements (PPAs)
What is the role of ACER?
The EMD Regulation mandated ACER to:
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assess the need to develop new voluntary PPAs contract templates;
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monitor the PPA market through annual assessments;
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address any remaining barriers to market integration.
Assessment on the need for additional PPA contract templates
To inform its assessment, ACER engaged with a broad range of stakeholders through an expert group and a public consultation over summer 2024. More than 100 European and international stakeholders, including market players, sector associations, legal professionals, and academics, participated in the consultation process.
Following this comprehensive consultation process, ACER concluded that introducing new voluntary PPA contract templates is not necessary:
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Existing templates, developed by industry associations and national bodies, are largely sufficient for current market needs.
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These templates already provide sufficient guidance for market participants, help them reduce legal costs and simplify the contracting process.
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Addressing critical market barriers, such as project development bottlenecks, would have a more meaningful impact on fostering the PPA market.
ACER will continue to monitor the PPA market as part of its reporting obligations and to support market participants by addressing structural barriers in its recommendations.
Annual assessment on the PPA market
As part of its annual monitoring report, ACER will publish an assessment of the PPA market both at European and Member State level.
The assessment is expected to be published in Q4 2025 and will evaluate how PPAs impact barriers to market integration.