2018 a record year for wind power PPAs

29th January 2019


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  • EU

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IEMA

European firms signed a record 1.5 GW worth of power purchase agreements (PPAs) with wind farms in 2018 amid growing interest from energy-intensive industries.

That is according to data from WindEurope, which reveals that the automotive and pharmaceutical sectors recorded their first PPAs last year, while the aluminium industry was most active.

This is despite PPAs traditionally being the domain of the ICT sector, which would use the long-term arrangements to power large data centres at fixed prices.

The analysis shows that European companies have now signed nearly 5 GW of PPAs since their creation in 2014 – equivalent to Denmark's total wind energy capacity.

“Corporate PPAs are booming,“ said WindEurope CEO, Giles Dickson. “It shows industrial consumers see wind power as competitive and reliable, and it'll help allow industry to reduce its energy costs.“

The findings show that Nordic countries still have the most PPAs, although Germany, Spain and Poland recorded their first deals last year, with France and Italy interested too.

Norwegian aluminium and renewable energy company Norsk Hydro signed a deal in 2018 that will last 29 years, compared to an average contract of around 15 years.

While the deal in Germany will see wind energy powering Mercedes-Benz's electric vehicle and battery manufacturing.

And WindEurope said there is no reason why demand for PPAs should fall, with the EU set to instruct governments to remove outstanding regulatory barriers in its Clean Energy Package.

Dickson continued: “2018 saw a record number of new deals, and the first PPAs in the automotive sector and in pharmaceuticals – and the first in Germany, Spain and Poland.

“The CO2 benefits are big, industry accounts over half of Europe's electricity consumption, but some countries still have barriers to PPAs.

“They'll have to remove them under the EU's Clean Energy Package, and they should say how in their national energy plans this year.“

Image credit: iStock

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