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DECC asks for evidence after claims of deteriorating PPA market

July 5th 2012

The Department of Energy and Climate Change (DECC) is now asking independent renewable generation developers to supply them with evidence to support claims that the Power Purchase Agreement (PPA) market has deteriorated.
The move comes after DECC said it had noted that a number of generators were “reporting a decline in the terms they are being offered for PPA’s.”
Due to the fact that investing in renewables industry in the initial stages usually involves a considerable amount of investment, it is vital that such long-term contracts which guarantee the purchase of the power offer the right rewards and fair terms. The Government is now calling on generation developers to provide DECC with evidence so that it can assess and address barriers to market access that independent renewable generators seem to be experiencing.

The Government is estimating that over the next ten years it requires £110 billion of investment in low-carbon forms of generation to meet climate obligations and energy requirements. DECC will collect feedback from today, (5 July) until 16 August 2012 which will be used to give Government a more informed understanding of the PPA market and in turn, help refine proposals set out in the draft Energy Bill.

To read DECC’s document; ‘A call for evidence on barriers to securing long-term contracts for independent renewable generation investment’ click here.