Newcastle University is one of 20 universities which have struck a renewable energy deal which will help reduce carbon emissions.
The aggregated power purchase agreements (PPA), involves the universities buying £50m of renewable energy from a group of wind farms. The deal would then fix power prices at a competitive rate for the next ten years, which minimises their exposure to market volatility. This PPA has been arranged by Squeaky Clean Energy in association with The Energy Consortium (TEC). Statkraft, Europe’s largest producer of renewable energy, will deliver the wind power from their British Portfolio every year.
Matt Dunlop, the Head of Sustainability at Newcastle University, said that “the PPA was part of our strategy to diversify and increase our investment in both on and off-site renewables as part of our climate action plan to achieve net-zero CO2 emissions by 2040.”
In order to meet the high standards demanded by the universities which are involved, the deal has been structured to allow the power from the wind farms to contractually flow with the Renewable Energy Guarantees of Origin (REGOs). The PPA will help the participants meet the UK’s goal to build a net-zero carbon economy by 2050. This first kind of transaction also provides a platform to open the market to much smaller companies and public sector bodies.
In the past, the complexity of arranging PPAs meant that only large corporations who had the capability and resources needed to negotiate these agreements. And to make a PPA with smaller organisations as the scale as any deal was always too small. However, the establishment of standardised documentation that cut down the size of the contract which lowered transaction costs to an affordable level.
Last modified: 15th February 2020