Power Purchase Agreements & The Green Revolution

Goodbye coal, hello renewables

Last week Britain hit another promising milestone – 2 months running without coal generated power.

Only 10 years ago, 40 % of Britain’s electrical grid was supplied by coal fired generation and only 3 % from renewables. Over the past month and year, 27.5 % and 25 % respectively of the grid has been supplied by renewable energy (wind, hydro and solar).



Source: https://grid.iamkate.com

Driving the green revolution

In order to improve these numbers even further, a mix of Government intervention, increased financing and attractive energy contracts such as power purchase agreements (PPAs) are required. The Government announced in the 2020 Budget that the CCA scheme will run until March 2025 with application anticipated to be accepted until September 2020. This gives companies an opportunity to receive up to a 90% reduction in the climate change levy (CCL) tax.

The eligibility for CCA is based upon a company’s commitment to pre-determined energy reduction targets with the aim of saving money and carbon. With energy, cost and emission reduction a high priority for businesses, careful consideration should be given to which route is best for your business. If CCL is not the biggest issue facing your business energy costs (i.e. your business is not an energy intensive industry), there are various other solutions to creating a more energy efficient business.


True Green vs Green Wash

Green electricity contracts (using 100% renewable energy) are widely available on the energy market however they do often carry a larger price tag than their brown counterparts. It is important to understand if your supplier is offering a true green contract as opposed to a “green wash” contract which mixes a percentage of renewable energy with non renewables – this may well not be clear in the contract therefore careful consideration of contracts is worthwhile.

Unfortunately signing up to a green energy contract does not currently have any impact on your CCL payments and may impact your CCA status. The most green solution for your business may be applying for a CCA or choosing a green contract over joining the CCA scheme. This is where Boxfish can help. Our 25 years of experience in utility management places us in the perfect position to get the best deal for you whether it is finding you the cheapest green contract or helping with your CCA application.

Power Purchase Agreements to help your business

Power Purchase Agreements or PPAs are fixed price agreements between an energy generator and a buyer. The aim of the agreement is to provide the buyer with a fixed amount of green energy whilst providing an economic business case to install renewable or low carbon energy generation technologies.In the beginning the large PPAs such as new wind farms, were being snatched up by large companies however as the awareness of the economic and environmental benefits of PPAs grows, so do the options.

Talk to us about finding possible PPAs for your business – call us on 0141 226 8525 or email us at hello@weareboxfish.com


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