Falling raw material costs and energy prices are weighing down European power purchase contracts in May



Power purchase agreements (PPA) prices are falling in all European markets except Spain and Portugal, according to Pexapark. The biggest decline has been in the Netherlands and Great Britain.

According to the May report of the Swiss consulting company Pexapark, the prices of electricity, gas and raw materials have dropped significantly. The price of coal fell below 80 euros ($87.62)/t0, which is the lowest in more than four months.

Pexapark notes that PPA prices have also fallen “significantly” in Europe. Most countries followed a downward trend, with 15.7% in the Netherlands and 15.5% in Great Britain. Prices rose only in Portugal and Spain. Pexapark does not disclose country-specific prices or other financial details in the report.

In May, 23 new electricity procurement contracts related to renewable energy sources were announced, which is 35% more than the previous month. The total capacity of these announcements was 982 MW, 2% more than in April. Small PPAs dominated May, with only two deals exceeding 100MW, compared to eight in February 2023, as reported by Pexapark.

The most deals were made in May in Germany, six announcements, totaling more than 245 MW. Spain came in second with five announcements, totaling around 317 MW. In particular, Equinix made the largest contract by purchasing 240 GWh of electricity per year from the 150 MW Sonnedix portfolio in Spain.

David is a passionate writer and researcher who specializes in solar energy. He has a strong background in engineering and environmental science, which gives him a deep understanding of the science behind solar power and its benefits. David writes about the latest developments in solar technology and provides practical advice for homeowners and businesses who are interested in switching to solar.

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