OPEX/PPA models for renewable power

OPEX (standing for operational expense) or PPA (standing for power purchase agreements) models are business models that can be used for renewable power purchase by any company. By making use of green and renewable power as an operational expense (instead of a capital expense which is the case when the company invests on its own on a solar or wind power plant), OPEX or PPA based renewable power has the potential to significantly accelerate the implementation or use of renewable power for business and industrial operations.

Stakeholders

Energy management professionals

International policy makers

Senior or top management

Vital Stats

How does it work?

Under the OPEX model, a Renewable Energy Service Company (RESCO) invests, builds and maintains a rooftop/ onsite solar plant. The end consumer pays for the power generated under a long-term power purchase agreement (PPA) at an agreed tariff for a fixed tenure.

Sustainability benefits

The model frees capital for the customer to invest in other areas. At the same, it gives access to low-cost power and savings in the electricity bill, and thus accelerates the use of renewable and low carbon power across many industrial units.

Highlights/USP

Interestingly, the OPEX/PPA models are possible even when a company has solar panels installed on its own rooftop. In this case, though the rooftop belongs to the company, the solar power system belongs to an external company that owns and operates the solar power plant and provides the green power to the company (rooftop owner) who only pays for the power that is consumed by them.

Stage of commercialization

Commercialized

Types of professionals who can improve the solution

Economists, Energy engineers

Specifically relevant to any geography?

Decarbonization Potential

High

Value Chain

Textile yarn , Textile fabric production ,

Web Resources

Long term solar contracts vs buying solar

Companies are increasingly looking to on-site solar projects to cut costs and carbon footprint sustainably. Some Total customers have reduced their power costs by 30 to 40 percent – saving USD millions annually. This article elaborates on the key differences between buying a solar system and signing up to a long-term power contract.

Read More


Long term solar contracts vs buying solar

Companies are increasingly looking to on-site solar projects to cut costs and carbon footprint sustainably. Some Total customers have reduced their power costs by 30 to 40 percent – saving USD millions annually. This article elaborates on the key differences between buying a solar system and signing up to a long-term power contract.

Read More


Compare OPEX Vs CAPEX Models

When you are considering buying solar power, you would generally find two options in the market – Investing into a rooftop solar plant or buying solar power under a power purchase agreement (PPA). Both the options can be availed under two models: the capital expenditure (CAPEX) model or the operating expenditure (OPEX) model. This article will help you make an informed decision by highlighting the differences between the two in terms of their merits and disadvantages, and which model suits your business better.

Read More