Europe: Pexapark forecasts changes to PPA

In its "European PPA Market Outlook 2022" report, Pexapark outlined that change is afoot regarding the way in which data center operators purchase renewable energy. The energy price volatility of 2021 will reportedly have a long-term impact on PPA deals, with larger consumers buying up big offshore wind projects and saying goodbye to traditional long-term 10-year contracts. 

In its report, it outlined that both availability and pricing for long-term PPAs will be tested due to both "the maturity of some markets" and 'the pricing impact of the recent market turmoil". It was also explained that "mega energy buyers", like global data center giants (think Amazon and Google) who have dominated in the last year, will "not be able to procure PPAs as corporates did over the last years."

Further to this, it said: "Those gargantuan green procurement needs are approached differently …procurement on a mere PPA basis is insufficient and equity investments in the underlying PPA assets may be required to secure volumes."