This course provides a methodical review of financial and risk elements that influence the value of renewable energy power purchase agreements (PPAs).

The course will explore the many layers of financial considerations that confer value in these contracts for power.  It will devote a granular look at the dependent relationships that often make the difference between a PPA that accomplishes its objectives over an extended period versus one that can disappoint almost immediately.

The instructors will review and demonstrate multiple analyses and methodologies that provide important financial and risk guidance in the structuring of PPAs for project developers, off-takers, investors, lenders and other transaction parties.  

Learning Outcomes   

• Review the fundamental financial components of PPA
• Examine the underlying risk factors that impact the value of a PPA
• Evaluate fleshed-out PPA terms
• Assess the relationship between PPA price and value
• Discuss project production-related guarantees
• Identify the differences between the standard contractual parameters used for wind and solar contracts
• Evaluate risk distinctions that especially apply to virtual/financial PPAs

WEDNESDAY, JANUARY 18, 2023 : CENTRAL TIME

 

9:00 – 9:20 a.m. :: Overview and Introductions

9:20 – 10:45 a.m. :: Finance & Valuation Fundamentals of PPAs

• What drives a PPA?
• What are typical returns?
• What is in a pro-forma?
• What drives returns? What are levers?
• Example
• What are investor concerns?
• Concept of risk and return
• Translating PPA legal terms into financial terms
• Role of consultant(s)

Steve Birndorf, Director – Renewable Energy Consulting, NextEra Energy

10:45 – 11:00 a.m. :: Morning Break

11:00 a.m. – 12:30 p.m. :: Market Trends and Externalities Influencing the Trajectory of PPA Prices and Practices

• Aggregate
• PPA vs Virtual PPAs (VPPAs)

Changing Market Fundamentals and Effects on the Valuation of Renewable and Storage PPAs

• How renewable generation affects electricity markets
• Understanding basis risk under mass renewable deployment
• Buyer motivations for renewable procurement
  • Annual RECs versus 24-7 clean energy
• Reliability and economic implications of storage paired with renewables

Annie McClelland, Director – Origination & Regulatory Affairs, Renewable Energy Systems (RES), Americas

Nicolas Muszynski, Vice President – Energy Storage, Renewable Energy Systems (RES) Americas

12:30 – 1:15 p.m. :: Lunch Break

1:15 – 3:00 p.m. :: Examining the Underlying Risk Factors that Impact the Value of a PPA

• Curves
  • How market projections impact contract economics
  • Traded curves (forwards) vs consultant curves (forecasts)
  • Components of curve generation
• Shapes
  • Timing of generation and delivery
• Hub
  • Types of contracts available
  • What happens when the same project offers to settle at a different hub?
• Penetration
  • Relationship of value to installed generation base
• Timing
  • On-line date and tenor
  • Generation and delivery schedule
  • Relationship to all power generation in service pricing area
• Negative co-variance
  • How does historical back-cast impact contract value?

Brock Mosovsky, Vice President – Analytics, cquant.io

3:00 – 3:15 p.m. :: Afternoon Break

3:15 – 4:45 p.m. :: Term Sheet Review – Key Commercial Terms

• Examples
• Business acquisition perspective
• Off-taker perspective

Examining the Relationship Between Price and Value

• Price of the carbon benefit
• Net settlement
• Single project vs portfolio contract position(s)
• Mark-to-market (MtM) value of PPA over time as market conditions evolve

Supria Ranade, Senior Director – Power Marketing and Origination, SoftBank Energy

4:45 p.m. :: Course Adjoins for Day

 

THURSDAY, JANUARY 19, 2023 : CENTRAL TIME

 

9:00 – 10:30 a.m. :: Impact on PPA Risk and Price of Project Production-Related Guarantees

• Availability
• Output and performance
• Forced curtailment

Impact on PPA Risk and Price of Standard Contractual Parameters and Terms

• Liquidated damages and termination rights
• Force Majeure
• Differences between wind and solar contracts

Supria Ranade, Senior Director – Power Marketing and Origination, SoftBank Energy

10:30 – 10:45 a.m. :: Morning Break

10:45 a.m. – 12:00 p.m. :: Panel Discussion: Impact of Externalities on the PPA Landscape & Implications for Negotiations

• Supply Chain
• Tariffs
• Customs impositions
• Inflation Reduction Act
• CHIPS Act

12:00 p.m. :: Program Adjournment

Steve Birndorf is Director – Renewable Energy Consulting at NextEra Energy. He is a seasoned solar and renewable energy executive with more than 20 years of professional experience. With a foundation in consulting, finance, and business development, he has developed projects, led teams and built organizations. Steve has developed, financed and advised on more than $500M of utility scale and C&I solar projects, largely to private industry, municipalities, school districts and water agencies. Before joining the company in 2020, Mr. Birndorf’s industry career has included stints at Edison Energy, Valor Analytics, Sungevity Solar, Borrego Solar and AMSOLAR. He graduated magna cum laude from the University of Pennsylvania and earned his MS and MBA from the University of California at Berkeley. 

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Annie McClelland is Director of Origination & Regulatory Affairs at Renewable Energy Systems (RES), Americas.  She assumed that position in 2021 after serving as Senior Manager of Origination.  She has worked on the RES Americas origination team since 2017.  In that capacity, she secures off-take agreements for utility-scale wind/solar projects, innovates deal structures to match client needs and works collaboratively across the company to achieve sales targets and ensure that development investments reflect market interest.  Prior to joining the firm, Ms. McClelland served three years at the Citizens Campaign for the Environment.  She earned her B.A. degree from Cornell University and MBA degree from the University of Colorado.

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Brock Mosovsky, PhD is Vice President of Analytics for cQuant.io. He has more than a dozen years’ experience developing, validating, and maintaining analytical models, with an emphasis on energy risk management, market analysis, and renewable energy valuation. Dr. Mosovsky has worked with some of the country’s largest utilities and independent power producers to help forecast value and mitigate risk for their diverse portfolios of physical and financial assets. He holds a Ph.D. in Applied Mathematics from the University of Colorado, Boulder and received a U.S. Fulbright Scholarship for study in the Netherlands.

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Nicolas Muszynski is Vice President of Energy Storage at Renewable Energy Systems (RES) Americas, where he has worked since 2008.  Before  moving to this current position in late 2021, for the previous several years he served as Director of Energy Storage as well as Senior Development Manager for Renewables and Transmission and Development Manager of Wind Energy.  Before he joined RES Americas, he was Development Manager at Wind Energy at Airtricity (acquired by E.ON Climate and Renewables) and Project Analyst at AWS Truewind. He started his career at Helimax Energie (acquired by DNV-GL – Renewables) as a Wind Energy Project Engineer. He earned a Bachelor of Engineering (B.Eng.) degree in Engineering Physics at Université de Montréal – Ecole polytechnique de Montréal.

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Supria Ranade is Senior Director – Power Marketing and Origination at SoftBank Energy.  She has more than 12 years of experience in the North American power, gas, and environmental markets. Prior to joining the company earlier this year, she was Senior Director – Power Marketing and Wholesale Operation at Lightsource BP.  Previously, she worked on structured transactions at Direct Energy, BGC Partners, and Evolution Markets. Ms. Ranade received her Bachelor of Science in Environmental Science, from Johns Hopkins University, a Master of Science at Columbia University. She currently serves on the Board of the Midwest Renewable Energy Tracking System (M-RETS).

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Christy Searl is a Managing Director at Leyline Renewable Capital LLC.  In this role, she is responsible for creating and nurturing relationships with renewable energy project developers and connecting them to Leyline’s capital solutions.  Ms. Searl started her career as a lawyer, before transitioning to business development, origination and investing. As an attorney at Chadbourne & Parke LLP, now Norton Rose Fulbright LLP, she worked on project finance arbitration matters relating to waste-to-energy facilities in North Carolina.  She also previously served as in-house legal counsel at Lehman Brothers, where part of her work was with the commercial real estate, real estate private equity and energy investment banking groups on cases involving development projects and energy-related financing investments.  Ms. Searl subsequently worked for the Lehman Bankruptcy Estate for nearly a decade, assisting in the workout and sale of Lehman’s legacy real estate portfolio.  She later helped manage a pipeline of investments at alternative capital provider Burford Capital, while originating and underwriting deals.  Directly before joining Leyline in 2022, Ms. Searl served as the head of U.S. sales and Senior Vice President for Bankruptcy and Restructuring at GLAS Americas.