High prices on the markets make PPA take off in France

“There is a reversal of the situation already now. (..) Because of the prices, it becomes interesting not only for large companies but also for industrialists, ”Sylvie Perrin, partner of the firm De Gaulle Fleurance & Associés and president of the Green Platform, which brings together professionals, told Montel. of the energy transition.

PPA contract prices are around EUR 60 / MWh, according to the Renewable Energies Union (SER). The electricity contract for delivery next year recently traded at EUR 142.75 / MWh on the EEX exchange.

“These high prices are an excellent signal for corporate PPAs. This could mark their real start in France, ”says Nicolas Goldberg of Columbus Consulting.

“Even if it’s temporary, it sends a signal to manufacturers that PPAs are securing part of the supply at a fixed price. They can no longer be so exposed to market prices for their electricity supply, ”he adds.

In France, large groups such as SNCF, Orange or RATP and certain manufacturers, such as Total or Engie, have already signed this type of contract.

State support

By vouching for the producer in the event of bankruptcy of the operator, the state would “start the machine”, according to him. The government must propose a draft text in the fall for a guarantee fund to be set up by the end of the year.

This fund is an “essential building block” in the growth of the PPA market since it “will make it possible to offer offers at the best prices for buyers of PPA”, notes Sean Vavasseur, Director of Studies and Territories at the SER.

However, it should benefit “a wide range of industrial and service consumers”, he underlines.

Production too low

For Yara Chakhtoura, in charge of wind power at Vattenfall France, while manufacturers certainly have an appetite for PPAs, the volumes of renewable energies outside the additional remuneration contract are however too low to meet this demand.

“Everything that will be put in place now will allow the volume of PPA to be increased, but for the moment we are in a fairly discreet market even at European level”, she observes.

“The production starts quickly and there are not enough projects for the number of consumers”, also notes Ms. Perrin, for whom the State has an interest in supporting renewable energies, the producers now paying her money. depending on the guarantees made at the time of the calls for tenders.

Aside from the volumes, there is a lack of visibility on the cost to transform an intermittent production profile of renewables into a stable consumption profile that manufacturers have, notes for his part Gildas Barreyre of the Union des energy consuming industries (Uniden).

With solar, for example, “manufacturers will have to buy back at night and potentially resell surpluses at noon”, so make transactions on the market, he explained.

Guarantees of origin

In order to fight against soaring prices on the markets, the European Commission on Wednesday proposed to promote PPPs.

To this end, guarantees of origin (GO) will be a crucial tool for the success of PPAs, according to the European executive which proposes that national governments be required to accede to all GO requests from renewable energy producers. , including those who receive financial support.

France produced 127 TWh of renewable electricity with a capacity of 56 GW last year (including 28 GW of wind and solar power), or a quarter of the electricity mix, while it is targeting 40% production from renewable sources by 2030.

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