Fluctuations in electricity prices have become one of the biggest threats to the profitability of manufacturing companies. In energy-intensive industries, electricity costs often account for 20\u201340% of total production costs, so a sudden price jump on the exchange can change the financial forecast of the entire business overnight. More and more Lithuanian and Baltic manufacturers are looking for a way to lock in prices for the long term \u2014 and increasingly, the answer is a PPA contract.<\/p>\n\n\n\n
PPA. Power Purchase Agreement<\/em>, lit. power purchase agreement) is a long-term contract between a green energy producer (the owner of a solar or wind power plant) and an electricity consumer, usually a manufacturing or industrial company. The contract stipulates in advance the price and quantity of electricity the electricity company will purchase over the entire contract period, which usually lasts 10\u201315 years.<\/p>\n\n\n\n The idea is simple: instead of buying electricity on the exchange at an unpredictable price, you contract directly with a renewable energy producer and know the price of your electricity for many years to come.<\/p>\n\n\n\n The main value of the PPA is \u2014 electricity price fixing for business<\/strong>. The price fixed in the contract protects the company from stock market fluctuations caused by geopolitics, weather conditions, gas prices or fuel taxes. The finance department can accurately plan costs 10-15 years ahead, which strengthens the company's negotiating position with customers and investors.<\/p>\n\n\n\n This is often the deciding argument. When concluding a PPA agreement, the company does not need to invest in the construction of a power plant<\/strong>. A solar farm or wind farm is financed, built and maintained by a manufacturer or project developer. The company simply buys the electricity produced at an agreed price.<\/p>\n\n\n\n The capital that would have been allocated to the power plant remains free for core activities \u2014 production expansion, equipment upgrades, or working capital. There is no large capital commitment on the balance sheet, no need to worry about maintenance or the risk of operating the power plant.<\/p>\n\n\n\n Purchasing green energy<\/strong> through a PPA is often cheaper than the average exchange price in the long term. The cost of generating solar and wind energy has fallen significantly in recent years, allowing producers to offer a competitive fixed rate, which often proves superior to the volatile exchange price in the long term.<\/p>\n\n\n\n By entering into a PPA, a company purchases actual renewable electricity, not just guarantees of origin. This directly reduces the company's carbon footprint and helps achieve ESG and sustainability goals. Renewable energy for industry<\/strong> is becoming not only a tool for cost management, but also a tool for competitive advantage \u2014 more and more partners and customers are demanding a green supply chain.<\/p>\n\n\n\n The choice depends on the company's consumption profile, available space, and network capabilities.<\/p>\n\n\n\n A PPA agreement is particularly beneficial for manufacturing and industrial companies that:<\/p>\n\n\n\n Energobalt helps manufacturing and industrial companies secure stable, low electricity prices for the long term through individually tailored PPA solutions. We assess your consumption, select the optimal renewable energy model and take care of the entire process - from analysis to the start of supply.<\/p>\n\n\n\n Want to know how much you could save with a PPA contract? Contact us<\/strong> and get a personalized offer for your company.<\/p>","protected":false},"excerpt":{"rendered":" Elektros kain\u0173 svyravimai tapo viena did\u017eiausi\u0173 gr\u0117smi\u0173 gamybos \u012fmoni\u0173 pelningumui. Energijai imlioje pramon\u0117je elektros s\u0105naudos neretai sudaro 20\u201340 % vis\u0173 gamybos ka\u0161t\u0173, tod\u0117l staigus kain\u0173 \u0161uolis bir\u017eoje gali per nakt\u012f pakeisti viso verslo finansin\u0119 prognoz\u0119. Vis daugiau Lietuvos ir Baltijos gamintoj\u0173 ie\u0161ko b\u016bdo, kaip kainas u\u017esifiksuoti ilgam laikui \u2014 ir vis da\u017eniau atsakymas yra PPA […]<\/p>\n","protected":false},"author":1,"featured_media":568,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-1093","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-straipsniai"],"_links":{"self":[{"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/posts\/1093","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/comments?post=1093"}],"version-history":[{"count":1,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/posts\/1093\/revisions"}],"predecessor-version":[{"id":1094,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/posts\/1093\/revisions\/1094"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/media\/568"}],"wp:attachment":[{"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/media?parent=1093"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/categories?post=1093"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/energobalt.lt\/en\/wp-json\/wp\/v2\/tags?post=1093"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Why PPA is the best solution for manufacturing companies<\/h2>\n\n\n\n
1. Price stability and predictability<\/h3>\n\n\n\n
2. No need to invest your own capital<\/h3>\n\n\n\n
3. Lower price than on the exchange<\/h3>\n\n\n\n
4. Sustainability goals and ESG<\/h3>\n\n\n\n
Types of PPA contracts<\/h2>\n\n\n\n
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What does the PPA implementation process look like?<\/h2>\n\n\n\n
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Is a PPA right for your company?<\/h2>\n\n\n\n
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Energobalt \u2014 your partner in green energy solutions<\/h2>\n\n\n\n