Zeigo and S&P Global Platts Analysis: European PPA offers continue to resist price pressure
Renewable energy platform Zeigo and energy information leader S&P Global Platts have published the latest European trends in Power Purchase Agreement.
Data from the Zeigo platform has been able to give S&P Global Platts a view into the European market. Key highlights include:
- Q2 trading was strong due to activity in Spain, UK, and Germany
- Spain continues to show its status as a mature and competitive renewables market with relatively low PPA prices
- The UK saw an increase in short-term PPAs
- Germany is forecasted to post the second highest PPA volumes in Europe after Spain this year
- Drive from emerging markets
- New government incentives in Poland and Romania will see a boost in renewable investment
- Price vs. costs
- PPA prices remain constant despite the rise in merchant prices
- Downward pressure on average terms
- 11.5 years is the average term on the Zeigo platform but the recent SSE and TotalEnergies five-year contract has been seen as an exemption with the general desire for shorter terms
Zeigo’s senior price analyst Freddie Lyons further explained, “We have been asked why go to tender now when prices are so high and have had to explain that PPAs have not risen to anything like the same extent.” Q2 has seen PPA offer prices continued to resist inflationary pressure from a bullish wholesale power market.
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