This solar city power purchase agreement (PPA) template is a document for when a municipality wants to use solar power through a third-party source. A power purchase contract is where the third-party company installs the Solar Equipment at their own cost but sells the generated power at a fixed amount per kWp.
Installation Property: (Property.Name)
Installation Address: (Property.Street) (Property.City) (Property.State) (Property.Zip)
Municipality/City: (Municipality.Name)
This solar city power purchase agreement is an agreement between [Client.FirstName] [Client.LastName] (“Client”) and [PowerProvider.FirstName] [PowerProvider.LastName] (“Power Provider”), starting on the (Begin.Date) (“Effective Date”). It is effective for (Number) years until (End.Date) (“Date of Termination”). The collective terms for the Client and Power Provider are “Parties” in this document.
The Power Provider will install (Solar.Equipment) (“Solar Equipment”) at the municipal-approved and owned location [Client.StreetAddress] [Client.City] [Client.State] [Client.PostalCode] (“Property”).
The Power Provider will complete the Operations within a reasonable time and with the prospective installation date of (Date) (“Operation Date”).
The Client owns the Property and approves the construction, installation, and maintenance of the Solar Equipment installed on the premises.
The Power Provider will install and maintain the Solar Equipment per the laws of (State). The Client agrees to pay the fixed power purchase rate per kWh for the Energy Output gained.“Energy Output” refers to the total net energy output the Provider delivers to the Client through the meter.
“kWac” means the kilowatt alternating current. "kWh" means kilowatt hour. “kWhac” means the kilowatt-hour alternating current. “kWp” means kilowatt-rated power.“Operation” is an event occurring during the time the Power Provider (i) completes the installation, maintenance, and repairs of the Solar Equipment and (ii) uses the appropriate meter to deliver solar energy to the Client.
“Operation Date” refers to when fully functioning Solar Equipment is completed thanks to the Operation services and installation.
“Solar Equipment” is the power generation equipment, conduits, switches, connections, controls, wires, meters, and other equipment which ensure a fully-functioning Energy Delivery Point to provide the Client with solar power.
A utility-scale solar power purchase agreement refers to an agreement that covers a large amount of generated kWp. As such, it’s perfect for municipalities to take the edge off the city’s electricity load. You can use this template as is, but you can also customize it to be what you need.
According to the terms and conditions of this solar city power purchase agreement, the Client will pay a fixed rate for the Energy Output used. This amount will stay fixed for (Number) years before being evaluated, and a new rate can be negotiated between Parties.
There are two ways a municipality can use this agreement. The municipality states that Solar Equipment will carry 100% of its electricity load. Or they can also give a percentage of the load that will be carried by solar power each month. It’s generally only worth it for small municipalities if you enter a 100% contract. However, some bigger ones might want to test it with a 20% contract.
The Client agrees that (Number)% of the overall electricity load in (City), (Municipality) will be carried each month by the generated solar power. Both parties understand that the monthly Energy Output might differ slightly, but the monthly average kWp is (Number) kWp.
The Client will pay $(Rate.Amount) per each kWp used by the 1st of each month to the Power Provider. If the Power Provider does not receive the monthly power payment by the 5th or by (Number) days after the payment due date, then an additional late fee of $(Late.Fee) may apply.
The Power Provider acknowledges it is their responsibility to send a monthly invoice that features detailed calculations and highlights the owed amount. Should a breach of default event occur, the Power Provider must generate a special invoice that covers all owed amounts and details on payment delays.
The Client will pay in United States Dollars (USD) using (Payment.Method1) or (Payment.Method2). Should the Client mail it, it is their responsibility to ensure the payment reaches the Power Provider before or on the 1st of each month to avoid additional charges.
The Power Provider owns the Solar Equipment and sells the Energy Output to the Client. The Power Provider is responsible for performing bi-annual/annual maintenance on the Solar Equipment, including, but not limited to, cleaning solar panels, checking wires and connections, etc.
The Power Provider is obliged to complete the Operations promptly while conducting the prescribed construction. The Power Provider must maintain the local agencies’ licenses, permits, and approvals for running the Solar Equipment.
The Power Provider is responsible for all costs and the performance of the Operations tasks. Both parties agree to maintain any Operations and Solar Equipment insurance. Further, the Power Provider is obliged to obtain tax credits and benefit from the Solar Tax Credits, while the Client can benefit from the federal Investment Tax Credits.
This solar city PPA template section clearly outlines the notice process. This process ensures you receive notices with no chance of them slipping through the cracks. Add a notice period and the method of giving the notice to cover yourself. Further, ensure that disputes are handled according to your terms. State the process, like how disputes should be resolved and what happens if they can’t be resolved.
All notices must be in writing and delivered to the other Party using a post mailing system or in person. The notices will only go into effect when the sending Party receives a delivery receipt or verifies the delivery in person. All notices must contain the full name, address, company, fax number, and telephone number of the other Party.
Should a dispute regarding the solar city power purchase agreement arise, the Parties will first attempt to resolve the dispute through mutual discussion. Should the parties not resolve it within 30 days, arbitration will be used to settle it.
Add any provisions not discussed elsewhere here. It’s a good section to customize as you need it. However, we also added some general ones you can consider.
If a Party requests a move or replacement of the Solar Equipment during the term of this document, that Party must obtain permission from the other Party and the necessary approvals. The Party must also fund the move and cover any expenses it generates.
Both Parties will receive related confidential documents regarding this contract and must keep them in a secure location. The Client and Power Provider agree not to publish these documents to the public.
Both Parties warrant to the other Party that they are validly existing, duly organized, and in excellent standing with the (State) laws. The parties warrant that they are qualified to conduct business as they comply with all laws, rules, and regulations of (State).
The Client agrees to provide reasonable security for the Solar Equipment. This security includes commercially reasonable monitoring of the Solar Equipment and Property alarms. The Client shall not, indirectly or directly, knowingly suffer, create, assume, cause, or incur to make a mortgage, liens, pledge, charge, security interest, or claim with respect to the Solar Equipment or its interest.
You might have some specific events of default which can result in the termination of the utility-scale solar power purchase agreement. We’ve added some of the general ones, but we recommend you add the ones specific to your contract here to help ensure you’re fully protected in this agreement.
Should one of the below “Events of Default” occur, the other Party has the right to terminate or suspend the power purchase agreement before the listed End Date.