Financing

Solar Power Purchase Agreement (PPA)

A Solar Power Purchase Agreement (PPA) is a financial arrangement where a solar company arranges for the design, permitting, financing and installation of a solar energy system on a customer’s property at little to no cost. The company sells the power generated to the host customer at a fixed rate that is typically lower than the local utility’s retail rate.

This lower electricity price serves to offset the customer’s purchase of electricity from the grid while the solar company receives the income from the electricity sales as well as any tax credits and other incentives generated from the system. PPAs typically range from 10 to 25 years and the developer remains responsible for the operation and maintenance of the system for the duration of the agreement. At the end of the PPA contract term, a customer may be able to extend the PPA, have the project owner remove the system or choose to buy the solar energy system from the owner.

For a SunTrap PPA, the customer is able to generate its electricity needs from the sun and onsite, while remaining connected to the grid. Not only does the customer save money on electricity, they increase their resilience and reliability, while supporting energy independence and the environment.