Flexible Power Purchase Agreements are increasingly important in the evolving UK energy market, particularly with the growth of renewable generation and demand response capabilities. These agreements, governed by English and Welsh law, provide a framework for both traditional power purchase arrangements and modern flexibility services. They are typically used when parties want to incorporate variable generation, consumption patterns, or storage capabilities into their power purchase arrangements, enabling participation in balancing markets and optimizing energy costs.
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1. Parties: Identification and details of the generator and buyer
2. Background: Context of the agreement, facility details, and generation capacity
3. Definitions: Key terms used throughout the agreement including regulatory references
4. Sale and Purchase Obligations: Core obligations regarding electricity sale and purchase, including delivery points and volume commitments
5. Pricing Mechanism: Price calculation, adjustments, floor/ceiling prices, and payment terms
6. Metering and Settlement: Requirements for measuring and recording electricity output, reconciliation processes
7. Flexibility Provisions: Core terms regarding demand response, load shifting, and balancing mechanisms
8. Credit Support: Security requirements, credit thresholds, and acceptable forms of security
9. Force Majeure: Events constituting force majeure and consequences
10. Term and Termination: Duration, renewal options, and termination rights
11. Governing Law and Disputes: Choice of law, jurisdiction, and dispute resolution procedures
1. Green Certificates: Handling of renewable energy certificates and environmental attributes (when renewable generation involved)
2. Storage Integration: Terms relating to energy storage facilities and their operation (when storage is part of the arrangement)
3. Carbon Reporting: Provisions for tracking and reporting carbon emissions (when required for regulatory compliance)
4. Grid Connection: Terms relating to grid connection and compliance (when generator is responsible for connection)
1. Facility Description: Technical specifications of the generation facility including capacity and technology type
2. Pricing Schedule: Detailed pricing mechanisms, calculations, and adjustment formulae
3. Operating Parameters: Technical operating requirements, constraints, and performance standards
4. Metering Specifications: Technical requirements for metering equipment and data collection
5. Communication Protocols: Procedures for operational communications, notifications, and emergency responses
6. Form of Credit Support: Templates for guarantees, letters of credit, or other security instruments
7. Settlement Procedures: Detailed procedures for billing, invoicing, and settlement
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