Rezolv Energy is a clean power producer established to build a multi-gigawatt portfolio of wind, solar and energy storage projects in South-Eastern Europe. Backed by €500 million from investment firm Actis, Rezolv already has well over 2 GW of clean energy being prepared for construction. We learned more from Matej Krušpán, Chief Commercial Officer at Rezolv Energy.
What are the benefits of PPAs over other forms of energy contracts?
One of the primary benefits is commercial because long-term, green PPAs reduce companies’ energy costs. It’s as simple as that. Our pitch to corporates is therefore based on a clear business case.
But the truth is that price is not the only factor that motivates commercial and industrial buyers. Many companies are driven by the need to reduce their carbon emissions, of course. Some are also drawn to the long-term stability of a PPA deal, both in terms of pricing and the security of their electricity supply.
There are also reputational benefits available for the companies that commit to a renewable energy PPA in Romania. This comes back to the nature of PPAs. Unlike other forms of energy contract, PPAs support the financing of renewables projects. So, by signing a PPA, companies are actually helping build the projects that will supply them with clean power. They can put their name on it. Being associated with renewables projects in this way is a very attractive option for many companies – as long as those projects are built to the highest ESG standards, as Rezolv’s will be.
What does “highest ESG standards” mean when it comes to renewable energy projects? Can you give some tangible examples?
Rezolv’s goal is for our projects to set a standard for the responsible development of renewable energy projects in South-Eastern Europe which others will be inspired to follow. Our sustainability strategy is built on industry best practice and adheres to international standards, including the Equator Principles and the International Finance Corporation’s Environmental and Social Performance Standards.
There are two main ways in which we can help ensure that our projects leave a lasting, tangibly positive legacy.
The first focuses on the communities that live close to our sites. One part of this is job creation. Dama Solar, for example, will create at least 500 full-time equivalent jobs in Arad during the two-year construction phase. These jobs will be suitable for men and women, on both a full-time and part-time basis. There will be training and skills development programmes in place, teaching a range of transferrable skills which can then be used in other roles once the plant is built. At least 30 full-time equivalent employees will then stay on for the lifetime of the project.
However, it’s about far more than jobs. We are also 100% committed to working with local stakeholders to develop investment programmes which create opportunities and improve living standards for local people.
The second main pillar of our sustainability strategy is striving to ensure that each of our projects supports flourishing ecosystems. We will minimize the impact of our projects on the natural habitat and, wherever possible, we will try to restore damaged land.
At Dama Solar, for instance, we are exploring the option of integrating symbiotic agricultural activities. The land there has been over-cultivated in the past. It’s poor quality from a farming perspective and is of limited value ecologically. We would like to return much of it to pasture, with sheep managing the vegetation through grazing. We will also seek to incorporate beekeeping and other measures to increase biodiversity.
How have Romanian companies been responding? How much interest has there been in signing a PPA?
There is huge interest in procuring renewable electricity, but PPAs are still a relatively new concept here. This will change over time but, right now, the barrier is primarily psychological. You are asking a company that has always bought electricity annually through an energy trader to sign a contract for a period of 10+ years directly with an energy producer. It’s a big step. It’s understandable that people are cautious.
But things are moving very quickly. Expect to see a major step-change in 2024 with a large number of PPA deals being announced – including by Rezolv!
With new renewables capacity coming onstream all the time, why should corporates consider a PPA with Rezolv rather than another renewables developer?
As well as our ESG standards, our ‘USP’ stems from the nature of the company. Rezolv’s senior team has decades of experience in clean energy, and previously built and operated major projects across Central & Eastern Europe, including in Romania. We understand how to deliver large, complex energy projects.
On top of that, Rezolv is backed by Actis, one of the world’s most respected energy investors. Actis has invested in over 70 renewable energy projects all over the world. As well as benefitting from that experience, Actis’ investment has also enabled us to acquire very large projects – in Romania alone, more than 1GW of wind capacity and the same of solar. That matters because utility-scale projects are proportionately cheaper and deliver the lowest cost of electricity for everyone. It also matters because it enables our PPAs to include a mix of wind and solar power, allowing us to shape the contract to the customer’s consumption profile.
Finally, all of Rezolv’s projects are fully permitted, with construction of all of them due to start in 2024. They also have confirmed capacity for grid access in close proximity to the sites. Delays have been a common problem for renewable energy projects in this region in the past, but this gives customers confidence that we will be able to hit the timeframes we have set for our projects in Romania.
What should people do if they are interested in exploring the option of a renewable energy PPA?
We recently held the first in a series of ‘Power Brunch’ events in Bucharest which are designed for corporates interested in procuring clean energy. The second one will be organized very soon. We also host regular webinars which are free for anyone to join. But the quickest way is just to pick up the phone and give us a call.
Rezolv’s pipeline in the region
Rezolv Energy has three major projects in development in Romania: Dama Solar, a 1,044MW project in north-west Arad County, which will be the largest solar project anywhere in Europe once it is operational; the Dunarea East & West wind farms in Constanța County which, at 600MW, will become one of Europe’s largest onshore wind projects; and the 450MW VIFOR wind farm in Buzău County. A fourth project, St. George, which is in northern Bulgaria very close to the border with Romania, will become one of Bulgaria’s largest solar plants once it is built.
The power from these projects will be sold directly to commercial and industrial users through Power Purchase Agreements (PPAs).
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This interview first appeared in the printed edition of Energynomics Magazine, issued in December 2023.
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