A Guide to SPPA (Solar Power Purchase Agreements) in Queensland

What is a Solar Power Purchase Agreement (SPPA)?

A Solar Power Purchase Agreement (SPPA) refers to a fixed-time financial agreement where a third-party developer (e.g. a company like Infinite Energy, Horan and Bird, or EnergyAustralia) owns, operates, and maintains a Solar PV (photovoltaic) system at your residence (this can be at a house or a business). The customer agrees to house the solar system and then proceeds to buy the energy directly from the provider for a fixed period of time.

This financial arrangement allows the host customer to receive stable and, as a general rule, lower-cost electricity. There are also myriad benefits for the solar services provider in the form of incentives such as tax credits and also income generated from the sale of the electricity.

SPPA Explained
SPPA Explained – Adapted from Rahus Institute’s “The Customer’s Guide to Solar Power Purchase Agreements” (2008).

Private/Public SPPAs in Queensland

As all states are moving at their own pace with regards to renewables and the progress differs significantly, it’ll be interesting to see how the SPPA (solar power purchase agreement) in Queensland works in other states – and how long it takes before we see locations across Australia offering a similar scheme. These generally result in a kwh decrease of almost 50% (on an average SPPA in March 2017 you’ll pay ~13c / kWh compared to ~25c / kWh directly from retailers).

Mark Baily (QLD Energy Minister)  advised at the Solar 2015 Melbourne conference that the QLD Government remain committed to generating 50% of their energy from renewables by 2030.  To achieve these goals the Queensland Government have been offering both residents and developers generous incentives on Solar Power Purchase Agreements (SPPA).

SPPAs have been effective in other countries (such as America) and we’re confident

If you’re considering – keep in mind that these are only available in some areas of Queensland right now

How does an SPPA work in Queensland?

SPPA Queensland
Solar PPA (SPPA) in Queensland Explained (Image from InfiniteEnergy)

This image from InfiniteEnergy shows the basic steps one would undertake when starting an SPPA with them. This can vary from provider to provider but generally you can expect:

  • No (or minor) upfront capital costs
  • No operational risks (Provider is responsible for maintenance)
  • Substantial decrease in cost of electricity.
  • Potentially increased value of your building.
  • Possibility to ‘lock in’ electricity rates for a set period (like a fixed home loan – depending on supplier)

Send us a message if you’re located in Queensland and have any questions or you want to get started with an SPPA – we’ll be able to put you in touch with some recommended suppliers.

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