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Energy Purchase Agreement
I need an energy purchase agreement for a commercial entity looking to secure a 5-year contract for renewable energy supply, with flexible pricing options based on market rates and a clause for annual review of energy consumption and pricing terms. The agreement should include provisions for early termination with a 6-month notice period and penalties for non-compliance with agreed energy efficiency standards.
What is an Energy Purchase Agreement?
An Energy Purchase Agreement lets companies buy electricity directly from renewable energy producers in Belgium. It's a long-term contract that specifies how much power will be supplied, at what price, and under what conditions - typically running for 5 to 20 years.
These agreements have become crucial tools for Belgian businesses to meet their sustainability goals while managing energy costs. Under Belgian energy regulations, they help large consumers secure stable electricity prices and support the growth of renewable projects, particularly solar and wind farms. The contracts also detail important elements like delivery points, performance guarantees, and grid connection responsibilities.
When should you use an Energy Purchase Agreement?
Consider an Energy Purchase Agreement when your Belgian business needs predictable energy costs over the long term, especially if you're a large industrial consumer or data center operator. These agreements work particularly well when you're looking to secure renewable energy supplies while protecting against market price fluctuations.
The timing is ideal when planning major facility expansions, setting corporate sustainability targets, or facing volatile energy markets. Belgian companies often use these agreements to meet green energy requirements under EU directives, lock in competitive rates from new wind or solar projects, and demonstrate environmental commitment to stakeholders. They're especially valuable for energy-intensive operations in manufacturing, technology, and chemical sectors.
What are the different types of Energy Purchase Agreement?
- Power Purchase Contract: Basic agreement for direct energy purchases, typically used for conventional power sources with straightforward pricing structures
- Power Purchase Agreement Solar: Specialized for solar installations, including specific provisions for seasonal production variations and maintenance requirements
- Corporate Power Purchase Agreement: Comprehensive version for large businesses, often including complex pricing mechanisms and sustainability reporting
- Commercial Solar PPA: Tailored for commercial buildings, featuring flexible consumption terms and roof usage rights
- Contract For Differences PPA: Financial settlement structure where parties agree to hedge against market price fluctuations
Who should typically use an Energy Purchase Agreement?
- Energy Producers: Renewable energy companies, solar farm operators, and wind park developers who generate and sell electricity through these agreements
- Corporate Buyers: Large industrial consumers, data centers, and manufacturing facilities seeking long-term energy security and green credentials
- Legal Teams: In-house counsel and energy law specialists who structure and negotiate the agreements to comply with Belgian energy regulations
- Energy Consultants: Technical advisors who assess consumption patterns, verify generation capacity, and help determine pricing structures
- Grid Operators: Belgian transmission system operators who facilitate power delivery and ensure technical compliance with network requirements
How do you write an Energy Purchase Agreement?
- Energy Requirements: Calculate your annual electricity consumption, peak demand, and expected growth over the contract period
- Producer Details: Gather information about the energy provider's generation capacity, technology type, and grid connection points
- Financial Data: Determine pricing structure preferences, budget constraints, and acceptable price escalation terms
- Technical Specifications: Document delivery points, metering requirements, and any specific power quality needs
- Compliance Checklist: Review Belgian green energy certificates, EU sustainability reporting requirements, and grid connection regulations
- Contract Generation: Use our platform to create a legally-sound Energy Purchase Agreement that automatically includes all required elements under Belgian law
What should be included in an Energy Purchase Agreement?
- Parties and Capacity: Full legal names, registration numbers, and authorized signatories of both producer and buyer
- Energy Specifications: Detailed description of type, quantity, and quality of electricity to be supplied
- Pricing Structure: Clear terms for base rates, adjustments, and payment schedules in compliance with Belgian energy regulations
- Delivery Terms: Specified points of delivery, metering arrangements, and grid connection responsibilities
- Performance Guarantees: Minimum supply commitments, availability requirements, and maintenance schedules
- Regulatory Compliance: References to relevant Belgian and EU energy laws, green certificates, and sustainability reporting
- Term and Termination: Contract duration, renewal options, and conditions for early termination
What's the difference between an Energy Purchase Agreement and an Asset Purchase Agreement?
Energy Purchase Agreements differ significantly from Asset Purchase Agreement in both structure and purpose, though they're sometimes confused in energy infrastructure deals. While both involve significant financial commitments, their core functions and legal implications are distinct.
- Duration and Delivery: Energy Purchase Agreements focus on ongoing electricity supply over many years, while Asset Purchase Agreements handle one-time transfers of physical energy assets
- Payment Structure: EPAs involve recurring payments based on actual energy consumption and agreed rates, whereas Asset Purchase Agreements typically require lump-sum or structured payments for property transfer
- Regulatory Framework: EPAs must comply with Belgian energy market regulations and green certificate requirements, while Asset Purchase Agreements focus on property transfer laws and asset ownership rules
- Performance Obligations: EPAs include continuous supply commitments and quality standards, but Asset Purchase Agreements primarily address condition and ownership warranties at the time of transfer
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