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Power Purchase Agreements - Energy

Program Name or Ancillary Purchase AgreementsChandra Shah, revised2 | Federal Energy Management Customer-sited Power Purchase agreement (PPA) definition Project process Project examples Utility Renewable Energy Services Contract (URESC) Enhanced use lease (EUL) PPA support, resources and key points3 | Federal Energy Management Private entity purchases, installs, owns, operates and maintains customer-sited renewable equipment Site purchases electricity through Power Purchase agreement (PPA) Pros Renewable developer (or partner) eligible for tax incentives, accelerated depreciation No agency up-front capital required Renewable developer provides O&M Minimal risk to government Known long term electricity price for portion of site load On-site projects are encouraged for meeting federal renewable goal and are eligible for double bonus Good alternative to purchasing renewable Energy certificates (RECs) Can help with Energy security goals Cons Transaction costs Fairly limited federal sector experience Customer-SitedPower Purchase agreement 4 | Federal Energy Management (or other for REC sale)Federal AgencyRenewableDeveloperREC PaymentRECsPower Payment($)Electricity (MWh) (and Possible In-Kind Consideration)

14 | Federal Energy Management Program eere.energy.gov • Site or other agency contracting staff • DLA Energy (formerly Defense Energy Support Center) Renewable Team lead by: – Andrea Kincaid, DLA Energy - andrea.kincaid@dla.mil, 703-767-8669 – John Nelson, DLA Energy - john.nelson@dla.mil, 703-767-8523

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