The PPA Market entered its Golden Era with record activity, writes the latest report from Pexapark, the award-winning enterprise software and advisory company, specialised in renewable energy. Romania is mentioned one time in the 56 pages document: “We also expect growing activity in Southeastern European markets, with multiple eyes, particularly in Greece and Romania”.
Pexapark is reputed for its operating system to buy, sell and manage renewable energy. Over the past twelve months its PPA Tracker recorded a “hefty 16.2 GW of disclosed contracted volumes”, an increase of more than 40% compared to 2022. Deal count peaked at 272 PPAs – a 65% increase from 2022.
Spain and Germany accounted for 50% of 2023’s volumes and the balance between corporate and utility offtakes improved, although “corporates maintained the lead position in driving the PPA market”. IT conglomerates maintain their top ranking, with a total of 3.6 GW across 25 deals, with Amazon leading the sector with 1.87 GW contracted across seven deals in 2023.
Solar PV was by far more popular in PPA deal-making, holding the lion’s share with a total of 10.5GW – or, almost 65% of the year’s 16.2 GW PPA volumes across 160 deals. Onshore wind saw 2.3 GW across 58 deals, while offshore wind saw 2GW across 20 deals. Another notable trend in 2023, notes Pexapark, was the rapid growth of PPAs destined to power upcoming green hydrogen and ammonia plants. “PPAs linked to green hydrogen and ammonia production were announced in Norway, France and Germany, leveraging new and existing capacity.”
A new trend identified by Pexapark is the concept of 24/7 Green Energy Purchasing. “We often hear requests for ‘smarter renewables’ typically addressing the supply side. But what if a procurement approach is in the driving seat to request smarter renewables? […] The more niche trend to energy procurement is driven by corporates interested in hourly matching of consumption in lieu of the prevalent annual consumption matching model. […] A 24/7 carbon-free energy (CFE) procurement approach effectively makes greater and greener contributions to the energy transition. The benefits are threefold. First, more robust green credentials through hourly matching give green claims greater credibility than an annually-based approach. Secondly, this more granular approach results in greater deployment of renewables, as in effect demand drives the deployment of 24/7 green energy, aka a 100% renewables grid. This increases the additionality impact of the agreement. Very importantly, more granular matching of renewable energy PPA volumes with demand increases the effectiveness of PPA hedging by reducing the buyer’s exposure to the wholesale market for the deficit and excess volumes. Therefore, a 24/7 procurement can be a very impactful approach to sourcing renewable energy.”
Consistent with previous studies, a Pexapark and Eurelectric study found that high levels of hourly matching are already possible with current technologies. “An optimised portfolio of wind and solar PPAs is enough to start a 24/7 journey and achieve 60-75% hourly matching. Storage plays a key role in this approach, since portfolios that include co-located renewables-plus-storage assets can provide up to 90% hourly matching based on the latest configurations we see today (100% power ratio with 4h duration).”