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Commercial Power Purchase Agreement Template for England and Wales

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Key Requirements PROMPT example:

Commercial Power Purchase Agreement

"Need a Commercial Power Purchase Agreement for our 50MW solar facility in Cornwall, with a 15-year term starting March 2025, including provisions for REGOs and a minimum take-or-pay obligation of 80% of generated output."

Document background
Commercial Power Purchase Agreements are essential instruments in the UK energy market, particularly for organizations seeking to secure long-term electricity supply and manage energy costs. These agreements, governed by English and Welsh law, establish the commercial and technical framework for selling and purchasing electricity directly between generators and corporate buyers. The document typically includes detailed provisions on pricing, volume commitments, delivery points, and compliance with regulatory requirements. PPAs are particularly relevant in the context of renewable energy projects and corporate sustainability initiatives.
Suggested Sections

1. Parties: Identification and details of the power generator and purchaser

2. Background: Context of the agreement, including facility details and purpose

3. Definitions: Key terms used throughout the agreement including regulatory and technical terminology

4. Sale and Purchase Obligations: Core obligations regarding electricity supply and purchase, including delivery points and volume commitments

5. Pricing and Payment: Price calculation methodology, invoicing procedures, and payment terms

6. Term and Termination: Duration of agreement, renewal options, and termination rights and procedures

7. Metering and Reporting: Requirements for measuring and reporting electricity delivery and consumption

8. Force Majeure: Provisions dealing with events beyond parties' reasonable control

9. Governing Law and Disputes: Application of English and Welsh law and dispute resolution procedures

Optional Sections

1. Green Certificates: Provisions for handling REGOs and other environmental attributes when renewable energy sources are involved

2. Change in Law: Provisions addressing regulatory changes and their impact on the agreement

3. Credit Support: Financial security requirements and credit protection mechanisms

4. Capacity Market: Provisions relating to capacity market participation and revenue sharing

5. Grid Connection: Specific provisions relating to grid connection and compliance requirements

Suggested Schedules

1. Schedule 1 - Facility Description: Technical specifications and details of the generation facility

2. Schedule 2 - Pricing Mechanism: Detailed price calculations, adjustments, and worked examples

3. Schedule 3 - Operating Parameters: Technical specifications, operating procedures, and performance requirements

4. Schedule 4 - Metering Specifications: Technical requirements for metering equipment and data collection

5. Schedule 5 - Form of Performance Security: Template for guarantees, letters of credit, or other security instruments

6. Schedule 6 - Communications Protocol: Procedures for operational communications and notifications

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions











































Clauses


































Industries

Electricity Act 1989: Primary legislation establishing the framework for electricity generation, transmission, and supply, including licensing requirements and regulatory authority powers

Energy Act 2013: Legislation covering electricity market reforms, Contracts for Difference (CfD) regime, and Capacity Market mechanisms

Climate Change Act 2008: Framework legislation setting carbon reduction commitments and renewable energy targets

Electricity Market Reform policies: Regulatory framework governing electricity market operations and reforms

OFGEM regulations: Guidelines and regulations from the Office of Gas and Electricity Markets governing energy market operations

Grid Code and Distribution Code: Technical and operational codes governing connection and use of electricity transmission and distribution systems

Balancing and Settlement Code (BSC): Industry code defining the rules and governance for electricity balancing and settlement in Great Britain

Contract Law: Common law principles governing formation and enforcement of contracts in England and Wales

Competition Act 1998: Legislation prohibiting anti-competitive behavior and abuse of dominant market position

Consumer Rights Act 2015: Legislation protecting consumer rights, relevant if end-users are involved in the PPA structure

Data Protection Act 2018/UK GDPR: Legislation governing the processing and protection of personal data in the UK

Retained EU Energy Law: Post-Brexit retained EU legislation relating to energy markets and operations

REGO Scheme: Renewable Energy Guarantees of Origin scheme providing transparency to electricity consumers about renewable energy sources

Feed-in Tariff Regulations: Regulations governing the feed-in tariff scheme for renewable energy generation

Smart Meter Regulations: Technical and operational requirements for smart meter installation and operation in the UK energy market

Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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