Serving the energy industry for over 30 years
By - Jon Brown

Valuation of PPAs
Financial and Risk Dimensions that Confer Value to PPAs
April 7-8, 2020 | Online :: Mountain Time

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Overview

This is an Online Course! In lieu of recent developments with COVID-19, for the health and safety of our speakers and attendees, we have decided to move many of our events to Online Courses.

If this event is of interest you may also be interested in this related event

Renewable PPAs, April 6-7, 2020 | Online

This course provides a thorough review of financial and risk elements that influence the value of renewable energy power purchase agreements (PPAs).  It is a companion to the Renewable Energy Power Purchase Agreements seminar, which instead focuses on key provisions and central legal concerns associated with 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 and off-takers.  

Learning Outcomes   

  • Review the fundamental financial components of PPA
  • Examine the underlying risk factors that impact the value of a PPA
  • Discussa term sheet
  • 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
  • Review important data/telemetry requirements and SCADA/IT constraints
  • Evaluate risk distinctions that especially apply to virtual/financial PPAs

Credits

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EUCI has been accredited as an Authorized Provider by the International Association for Continuing Education and Training (IACET).  In obtaining this accreditation, EUCI has demonstrated that it  complies with the ANSI/IACET Standard which is recognized internationally as a standard of good practice. As a result of their Authorized Provider status, EUCI is authorized to offer IACET CEUs for its programs that qualify under the ANSI/IACET Standard.

EUCI is authorized by IACET to offer 1.0 CEUs for this event.

Instructional Methods

PowerPoint presentations and classroom discussion will be used in this course for each learning outcome. 

Requirements for Successful Completion of Program 

You must be logged in for the entire presentation and send in the evaluation after the course is completed.

Agenda

Tuesday, April 7, 2020

All times are in U.S. Mountain Time

12:30 – 1:00 p.m. :: Login and Welcome

1:00 – 1:15 p.m. :: Overview and Introductions

1:15 – 5:00 p.m. :: Program Content

(includes 15 min mid-afternoon break)


Understanding the Fundamental Financial Components of PPAs


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 renewable generation base
  •  Timing
    • On-line date and tenor
    • Generation and delivery schedule
    • Relationship to other power generation in service pricing area
  • Negative co-variance
    • How does historical backcast impact contract value?

Term Sheet Review

  • Key Commercial Terms 
    • Settlement point
    • Curtailment risk
    • Security
    • Pricing and its sub-categories
    • etc

5:00 p.m. :: Program Adjourns for Day


Wednesday, April 8, 2020 

8:30 a.m. – 12:00 p.m. :: Program Content

(includes 15 min mid-morning break)


Evaluating Fleshed-out PPA Terms


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

Project Production-Related Guarantees:  Understanding the Difference

  • Availability
  • Output and performance
  • Forced curtailment
  • Liquidated damages and termination rights
  • Force Majeure

Differences Between the Standard Contractual Parameters Used for Wind and Solar Contracts

12:00 – 1:00 p.m. :: Lunch Break

1:00 – 4:45 p.m. :: Program Content

(includes 15 min mid-afternoon break)

Data/Telemetry Requirements and SCADA/IT Constraints

  • Data needed from the project
  • Method of access
  • IT security constraints for both parties

ISO/RTO-Specific Considerations

  • Registration requirements
  • Metering requirements
  • Multiple PPAs from the same renewable energy project

Bi-lateral vs Wholesale Market-Based PPAs


Risk Distinctions that Especially Apply to Virtual/Financial PPAs

  • Credit
  • Portfolio monitoring
  • Curtailment risk
    • Proxy generation
  • Production guarantees
  • Availability guarantees
  • Seasonal guarantees
  • Fixed-quantity settlements
  • Proper accounting treatment

The Symbiosis Between Hedges and PPAs

4:45 p.m. :: Program Adjournment

Instructors

David Millar, Director of Energy Analytics, Ascend Analytics

David Millar is Director of Energy Analytics at Ascend Analytics. He leads Ascend’s consulting practice, providing utility clients with expertise in risk-based long-term resource planning and valuation. Previously, David worked at Pacific Gas and Electric, where he served as a Principal of Energy Modeling and Analysis. David led data analytics projects to guide company strategy on generation portfolio planning, energy storage valuation, and load and price forecasting. David previously worked in energy consulting with DNV GL and regulatory policy research at Lawrence Berkeley National Lab. He holds a master’s degree in Energy Economics and Policy from Duke University, and bachelor’s degrees in Earth Sciences and Political Science from the University of California, Santa Cruz.


Eliza Henderson, Senior Analyst of Corporate Relations, Cypress Creek Renewables

Eliza Henderson is Senior Analyst of Corporate Relations at Cypress Creek Renewables. At the company, she has held a number of roles associated with 300 MW of closed commercial off-take. Most recently, in her role she originates partnerships with Fortune 500 companies to meet their RPS goals with utility-scale solar. Before joining Cypress, Ms Henderson worked on SolarCity’s commercial RFP team and led proposal efforts in Latin America. Prior to SolarCity, she performed due diligence work at SunEdison for its commercial operations team. She received her B.S. from Georgetown University.


Brent Nelson, Senior Energy Analyst of Corporate Relations, Ascend Analytics

Dr. Brent Nelson is a senior energy analyst at Ascend Analytics, providing utility clients with expertise in demand management, resource planning, and renewable integration. Prior to joining the company, he was an Associate Professor of Mechanical Engineering at Northern Arizona University, while also holding a collaborative appointment with the directorate of Scientific Computing and Energy Analysis at the National Renewable Energy Laboratory. Dr. Nelson also worked for the US Department of Energy from 2014-2016, focusing on technology research and development programs for energy efficiency and demand side management. He has extensive experience in energy technology and energy system modeling, with a focus on understanding the impacts of future shifts in technology adoption. Dr. Nelson has also consulted for several companies and universities on their energy and sustainability initiatives. In addition to 11 years of experience as an academician with a research focus in energy analysis, he holds PhD and MS degrees in mechanical engineering from Georgia Institute of Technology, and a bachelor‘s degrees in mechanical engineering from the University of California, Berkeley.


Supria Ranade, Senior Director of Power Marketing and Wholesale Operations, Lightsource BP

Supria Ranade is Senior Director of Power Marketing and Wholesale Operations at Lightsource BP. She has more than 12 years of experience in the North American power, gas, and environmental markets. Prior to joining Lightsource BP, 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).

Online Delivery

We will be using Microsoft Teams to facilitate your participation in the upcoming event. You do not need to have an existing Teams account in order to participate in the broadcast – the course will play in your browser and you will have the option of using a microphone to speak with the room and ask questions, or type any questions in via the chat window and our on-site representative will relay your question to the instructor.

  • You will receive a meeting invitation will include a link to join the meeting.
  • Separate meeting invitations will be sent for the morning and afternoon sessions of the course.
    • You will need to join the appropriate meeting at the appropriate time. 
  • If you are using a microphone, please ensure that it is muted until such time as you need to ask a question.
  • The remote meeting connection will be open approximately 30 minutes before the start of the course. We encourage you to connect as early as possible in case you experience any unforeseen problems.

Register

Please Note: This event is being conducted entirely online. All attendees will connect and attend from their computer, one connection per purchase. For details please see our FAQ

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