0149 - Corporate PPAs, The role of corporates in the transition towards renewable energy

0149 - Corporate PPAs, The role of corporates in the transition towards renewable energy

04juni2018

The Dutch energy market is changing rapidly. Not a day passes by without a prominent newspaper headlining the need for a sustainable future and the path towards it. At the same time, newspapers often also mention in separate clipping another regulatory change affecting the energy market.

In a time where there is an urgent need for significant (private) investment in the sector,
the regulatory instability creates a lot of insecurity and scares away potential interested investors. Nevertheless, the Dutch government committed
to highly ambitious renewable energy and climate change goals following the Kyoto protocol and the Paris agreement. At Bird&Bird, we are engaged
by clients to secure and structure their investment in renewable energy projects. We advise our clients on how to contribute to these ambitions, from a legal perspective. Together with our clients, we work at the forefront of the market, enable innovative solutions and unlock new opportunities in the energy market.

In 2013, it became apparent that the Netherlands fell well behind its ambitious goals (4.4%) and performed very poorly compared to other EU countries (which until today is still the case). After an eight-month long negotiation period, facilitated by the Social and Economic Council of the Netherlands, the Dutch government and 47 stakeholders in the energy market signed the so-called Energy Agreement for Sustainable Growth ("Energieakkoord"). The stakeholders include central, regional and local government, employers’ associations and unions, environmental organizations, civil-society organizations and financial institutions who all have committed to the development of a robust, future-proof energy and climate policy.

The Energy Agreement for Sustainable Growth contains short, medium and long term goals and aims to aims to reduce the investment uncertainty. The following objectives were agreed:

  • a reduction in energy consumption averaging 1.5% annually;
  • a realisation of savings of final energy consumption of 100 petajoule (PJ) by 2020; and
  • an increase in renewable energy generation to 14% in 2020 and 16% by 2023 (in line with the European requirements).

The objectives are translated into concrete steps such as the increase of offshore wind energy to 4.450 MW and onshore wind energy to 6.000 MW. These very ambitious goals require the right balance between energy reliability, sustainability and affordability. Bird&Bird advises market parties on the regulatory changes and the possible impact on their business model and their investments.

Different market models and innovative contract structures are essential to support the transition towards a renewable future. Corporates around the world are looking at alternative solutions to strike the right balance between energy reliability, sustainability and affordability in terms of their energy consumption. The current trend of Corporate PPAs is only one of the game changers in energy world, energy management and storage is another.

AkzoNobel is one of the corporates that joined the RE100 which is a global initiative uniting more than 100 influential businesses committed to 100% renewable electricity. Companies joining RE100 set a public goal to source 100% of their global electricity consumption from renewable sources by a specified year. They disclose their electricity data annually, and RE100 reports on their progress.

Bird&Bird, as one of the leading energy practices across the world, advise market players on how to contribute to their sustainable goals and explore different ways of optimising and structuring their investments in renewable energy projects.
An interview with Joost Sandberg, Renewable Energy Development Manager at AkzoNobel and Sophie Dingenen, Corporate and Projects Partner at Bird&Bird.

Sophie and Joost have a longstanding working relationship. They have been collaborating on several major projects and transactions, all in the energy space. They worked together on one of the largest and complex European energy acquisitions during the financial crisis which was completed successfully. They are now working on the structuring of Corporate PPAs for certain renewable energy projects, such as wind farms. They both feel strong about the environment and a renewable society and each contribute in their profession towards this goal. 

Burgerlijk recht, Verzekeringsrecht
mr. Sophie Dingenen

mr. Sophie Dingenen

advocaat Bird & Bird LLP

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