Scholt Energy and Climate Fund Netherlands are realizing a solar park through an innovative PPA structure
Scholt Energy and Climate Fund Netherlands have signed the first CPPA (Corporate Power Purchasing Agreement) in combination with Rabobank's PPAssurance guarantee. With this CPPA, Scholt Energy purchases green electricity directly from the solar park Loon op Zand developed by Climate Fund Netherlands, in order to supply it directly to its large commercial customers. The CPPA ensures that the developer has a guaranteed income for a pre-agreed period, while the buyer locks in the price for their green electricity for that period. The PPAssurance product guarantees the income stream resulting from the closed CPPA, which allowed the financing to be completed and the solar project to be realized. This is the first time a bank guarantees a customer's CPPA in the Netherlands.
Dutch solar power projects have been under pressure for some time, with commodity prices and interest rates rising while the SDE++ (government subsidy) is even decreasing. Recently, five of the largest renewable solar project developers formed the 'Alliantie Zon' to convey this message in a letter to the Dutch Parliament; increase the SDE++ or the Netherlands will not achieve its solar energy goals! To solve this problem and make the new solar park Loon op Zand possible, Scholt Energy, Climate Fund, and Rabobank have joined forces. The result: 10MWp (approximately 4,500 households) of new green electricity for the Dutch grid.
In addition to the decreasing amount of the SDE++, it is also being phased out (gradually), and a CPPA is the perfect match to replace the predictable income stream from the SDE++. A CPPA is a long-term (3-10 years or even longer) energy contract with a fixed price agreed upon. This fixed price and period ensure a predictable income stream that can be financed. In order to consider these predictable incomes as sufficiently reliable, the buyer must have a strong credit rating. Rabobank has developed PPAssurance for this purpose, by placing a "simple" bank guarantee on the buyer's CPPA, the contract is made creditworthy. With the guarantee, the so-called credit risk is transferred from the buyer to the strong credit profile of Rabobank.
Together, Scholt Energy, Climate Fund, and Rabobank have made it possible for the new solar park Loon op Zand to become a reality. Hopefully, many more parks will follow in the future. If you have customers with a (semi)large energy bill, do not hesitate to contact us and we will see what we can do for your customer.
Bert Eissen, Scholt Energy: 'Scholt Energy is committed to making CPPAs accessible to a broad group of energy consumers. Thanks to the Rabobank guarantee, the CPPA now also offers the financial reliability required for investments in this solar park.'
Floris Leuftink, Climate Fund Netherlands: 'We believe that CPPAs will be the key to realizing more new solar parks. Each solar park is unique with its own characteristics, but CPPAs are also unique. In this case, at the Loon op Zand solar park, we had to be innovative, and thanks to Rabobank's PPAssurance product, we were able to secure the financing and realize the solar park. Many more projects are ready to follow this example!'