Momentum is building around a smarter way to procure and invest in clean energy with the greatest decarbonization potential. REsurety’s LME data helps clean energy buyers, developers, and investors do just that.
Purchasing renewable energy is a means decarbonization, but renewable energy projects are not all equal when it comes to cutting carbon. Locational Marginal Emissions (LMEs) measure carbon emission avoided by renewable energy projects at the most granular spatial level: the electrical node where energy is injected into the grid.
Texas crisis illustrates how hourly generation during high-priced hours spells the difference between big wins and big losses for clean energy buyers and sellers.
“We were delighted by the contribution [vPPAs] made to our sustainability goals but were frustrated by the financial volatility of the settlement payments and the limited ability we had to predict or manage that volatility,” wrote Kenneth Davies when he was director of energy portfolio management at Microsoft. Working with insurer Allianz and analytics firm REsurety, Davies came up with solutions including the proxy generation PPA, the volume firming agreement and the settlement guarantee agreement.
Data management company Iron Mountain has layered additional hedge contracts onto virtual power purchase agreements that it signed with two wind farms in 2016 and 2017 as it seeks to mitigate various risks associated with the popular renewable energy contracts. REsurety provided the valuation and risk analytics for the transactions, and will serve as calculation agent for tracking and settlement over the lives of the contracts.
REsurety helps Iron Mountain limit its exposure to variable weather and power markets, to achieve both sustainability and financial goals while investing in offsite renewable energy.
The only certainty in renewable energy markets is uncertainty. CEO Lee Taylor shares his insights on tools available today to understand and manage risk – tools like REmap, Volume Firming Agreements, and Settlement Guarantee Agreements.
REsurety contributes a chapter on how to manage risk in virtual PPAs through Volume Firming Agreements in this new report by RE-Source, a joint platform of WindEurope, SolarPower Europe, the RE100, and the World Business Council for Sustainable Development.
For C&I Buyers looking to mitigate risks in their PPAs, CohnReznick provides new accounting guidance on Volume Firming Agreements and Settlement Guarantee Agreements in a whitepaper co-published with REsurety.
Norton Rose Fulbright’s June 2019 Project Finance NewsWire features an interview with Lee Taylor, REsurety’s CEO on covariance risk and how to manage it. It starts on Page 21. The article is based on a Feb. 2019 Currents Podcast.