Ireland: The Future Of Corporate PPAs In Ireland

Last Updated: 13 April 2017
Article by Garret Farrelly

What is a "corporate PPA"?

In general terms, a "corporate" power purchase agreement (or "PPA") refers to a contractual arrangement whereby independent generators (typically renewable) and corporates that are large energy consumers, contract for the sale of power to that consumer (in Ireland, through their affiliated licensed supply companies). This model is replacing the traditional utility-backed PPA or green energy supply contract.

As noted above, consumers are typically large companies with a high demand, and who are willing to commit the necessary financial and technical resources in order to explore options outside of the traditional utility supply model. Large corporates (in particular the US tech companies) that are committed to consuming energy from renewable sources to power their activities are responsible for the increased popularity internationally of corporate PPAs in the last few years.

Do all corporate PPAs follow the same structure?

Internationally, there are different ways to structure a corporate PPA (depending on the underlying regulatory regime).

Under a "synthetic" PPA structure, the generator and the consumer enter into a direct financial hedging contract, such as a CFD (rather than a PPA). The consumer retains a supply contract with a utility, but contracts separately with the generator to provide a price floor for that generator's output in return for the associated green rights.

A "sleeved" PPA is a direct PPA between a generator and a consumer for an agreed level of power output. The consumer immediately sells all of the power procured under the generator PPA to a traditional utility under a second, back-to-back PPA. The utility (for an agreed financial margin) runs the power through the grid, 'tops up' the power if necessary to match the consumer's energy demand and then sells the power back to the consumer.

In Ireland, the likely contractual arrangement will be for the large corporates (through a related / affiliated supply company) to enter into a PPA (similar to the well-developed 'supplier-lite' renewable PPA commonly employed for renewable generation projects) with the independent generator together with a direct electricity supply contract between the corporate and its related / affiliated 'supplier-lite' supply company.

What are the advantages of entering into a corporate PPA?

For generators, a corporate PPA provides certainty for the generator to sell all or part of its electrical output at an agreed price under a long-term contract. This is particularly important for generators that may not be able to benefit from a renewable support scheme. A long-term contract with a credit-worthy offtaker will greatly improve a project's ability to obtain debt financing, and will also be attractive to any potential purchaser of the project.

There are two main advantages for corporates negotiating and entering into their own PPAs. First, for companies looking to "go green" or with mandated sustainability targets, a direct contractual arrangement with a renewable generator demonstrates a commitment to clean power and direct access to green certifications / accreditation. Second, by negotiating its own PPA, a corporate consumer may be able to negotiate a better commercial deal for its power with greater price certainty while also incorporating flexible terms to accommodate that particular consumer's demand.

What are the challenges?

For both generators and consumers, one of the biggest challenges in entering into corporate PPAs is allocating the appropriate resources to first, understand the market, and second, negotiate the best possible terms, particularly given the typically long tenor of corporate PPAs.

Generators that do not benefit from a feed-in tariff or support scheme, and who would otherwise contract with a large utility to buy their power, will need to ensure the creditworthiness of their corporate counterparties, to ensure that they will be able to meet their payments under the PPA (for the term of the PPA).

Another challenge facing both generators and corporate consumers (and anyone else entering into a long term power supply arrangement in the energy market) is the evolving regulatory framework of the electricity market in Ireland (and the EU).

Why is the Irish market suited to corporate PPAs?

There are three reasons why corporate PPAs are likely to become more popular in the Irish market:

  • There is currently 2,532MW of installed capacity of onshore wind in Ireland, and this is set to grow even further. Development is supported by both EU and Ireland government policy, including Ireland's 2020 targets under Directive 2009/28, and the EU's Climate and Energy Framework 2030. Accordingly, there should be a steady pipeline of renewable energy projects being developed in Ireland for the foreseeable future.
  • The current REFIT support schemes are now closed to new entrants. As a result, renewable generators will increasingly need to explore an alternative route to market (preferably via a long-term offtake arrangement), particularly in order to secure third party financing.
  • There are a significant number of large international companies based in Ireland with: (1) high electricity demand (for example, data centres); (2) sustainability policies to purchase energy generated from renewable sources; and (3) expertise in implementing these structures in other jurisdictions internationally. In addition, some companies are keen to demonstrate 'additionality' in their green energy consumption by directly investing in new renewable generation.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions