Power Purchase Agreements

Public agencies with surplus land available to lease or significant roof space should consider the benefits, both environmental and economic, of leasing such property to a third party entity under a Power Purchase Agreement (PPA) under which a third party shall bear the cost of installing a solar panel system and then sell, at a negotiated fixed cost, electricity back to the public entity. Special Government Code provision exempt PPAs from the surplus real property lease provisions thereby providing public agencies with flexibility in obtaining proposals and selecting a third party with whom to negotiate and enter into a PPA. BB&K negotiated PPAs for numerous public agency clients and can help public agencies avoid the numerous pitfalls of such agreements, including requiring security for the removal of systems at the end of the lease term and negotiating the allocation of the green-e tags of environmental attributes generated under the PPA.

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