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Power Purchase Agreement (PPA) for Utilities

Utilities · NAICS 22 · Power Purchase Agreement

A Power Purchase Agreement (PPA) is a critical contract between a utility (buyer) and an electricity generator (seller). It defines the terms for the sale and purchase of electricity, including price, delivery, and performance obligations. For utilities in NAICS 22, PPAs are essential for securing reliable power supply, integrating renewable energy, and managing price risk. This tool generates a comprehensive draft tailored to your project specifics, covering key commercial and legal provisions. It helps you streamline negotiations and ensure all critical elements are addressed, though it is not a substitute for legal counsel.

When you need this document

When procuring electricity from an independent power producer or merchant plant.
When developing a new renewable energy project (solar, wind, hydro) and need a contract to sell output.
When replacing an expiring PPA and need to renegotiate terms.
When purchasing power for resale to retail customers or wholesale markets.
When entering into a PPA to meet renewable portfolio standard (RPS) requirements.

What the generated draft includes

Parties and Recitals
Definitions and Interpretation
Term and Termination
Product and Delivery (Energy, Capacity, RECs)
Pricing and Payment Terms
Credit Support and Collateral
Representations and Warranties
Force Majeure and Indemnification

Frequently asked questions

What is the difference between a PPA and an interconnection agreement?

A PPA governs the sale of electricity between buyer and seller, while an interconnection agreement covers the physical connection of the generator to the grid. Both are often required, and the PPA typically references the interconnection agreement.

Can this PPA be used for renewable energy projects?

Yes, the template includes provisions for environmental attributes (RECs) and can be customized for solar, wind, or other renewables. It is designed to be flexible enough for various generation sources.

Does this document comply with FERC regulations?

The draft is structured to be adaptable, but FERC jurisdiction depends on the transaction specifics. It is not a substitute for regulatory review. Consult with legal counsel to ensure compliance with all applicable federal and state regulations.

Self-help document generator: you get a structured draft based on the facts you provide. It is not legal, tax, or financial advice; verify jurisdiction-specific rules before sending.

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