The Power Purchase Contract (AAE) is a complex part of an energy project and can be used to purchase any type of energy, including renewal and non-renewable. Negotiating a banking AAE is essential if a project is to be launched. There are many moving parts that influence the future of electricity generation in emerging countries. Unlike today`s independent power project models, which included standardized paid contracts, today`s market requires more innovative incentives to ensure better availability, better performance and more attractive and sustainable fuel source blends. There is an urgent need for the economies of all developing countries to master the key tools, models and lessons they have learned to transform and strengthen the current electricity sector. These include the latest models in the negotiation of power purhase agreements (ASA), the design and management of new competitive electricity markets, as well as obtaining the right mix of renewable energy sources. In this course of 15 modules delivered over 5 sessions, we first discuss the basics of energy purchase and the important concepts you need to understand to read, write and negotiate PPAs. After looking at the basics, we look at some of the components of the agreements and focus on those that are most often negotiated between electricity producers and electricity consumers. We are also looking at how the AAE integrates into the network of contracts for an energy development project and the interaction between the AAE and other contracts. This GLOMACS AAE training seminar will draw on a wide range of LDCs and case studies to develop contractual, commercial and risk management issues that will need to be addressed in an AAE without exception. The success of an energy project will depend in large part on how an AEA is negotiated and implemented.
The purpose of this seminar is to provide participants with the tools they need to do so. According to the IEA, “more than 70% of the $2 trillion needed each year to invest in energy supply comes either from state-run companies or from a total or partial guarantee of revenue.” This revenue guarantee is generally offered in the form of an aerating contract in the electricity sector and is therefore a decisive element in a project financing environment for IPPs. The banking capacity of AAEs is particularly demanding, as the growth in electricity demand occurs in emerging countries, with a creditworthiness to say the least doubtful of customers. Therefore, the banking capacity of AAEs is determined not only by complex contractual clauses under the trade agreement, but also by the electricity sector and the national context in which pip invested abroad operates. In most years, the project, which has been implemented, requires additional credit enhancement instruments to support the PPP in order to achieve its level of funding. Power Purchase Agreements (PPAs) work in many different contexts. They can be used to support the development of new projects or for the energy supply of existing projects.