Corporate Power Purchase Agreements
Ensuring production is predictable and climate-neutral. There’s a way.
With a corporate PPA, you link your electricity procurement directly to renewable energy plants — offering long-term planning, audit-proof verifiability and independence from subsidy rates. Predictable electricity prices safeguard your competitiveness, whilst the contractually fixed supply volume ensures your security of supply even during periods of market volatility. Power Purchase Agreements are the key driver of industrial decarbonisation and provide a stable foundation for your long-term procurement strategy, particularly in times of geopolitical uncertainty.
The Context
Stay organised when the world isn’t.
Geopolitical tensions, volatile energy markets and fragile supply chains make one thing clear: anyone who relies on spot markets and short-term contracts relinquishes control over their electricity costs. For industry, predictability thus becomes a competitive advantage – and independence from a market that no one can control becomes a strategic necessity.
Power Purchase Agreements (PPAs) put you back in control: they secure fixed terms for years to come, decouple your electricity costs from price spikes and political crises, and restore reliability to your cost calculations. The second, equally valuable benefit is that they measurably reduce your Scope 2 emissions and demonstrate a credible climate pathway to investors, customers and regulatory authorities.
For industrial companies, data centres, and firms in the chemical, steel and manufacturing sectors, electricity has long since ceased to be merely a cost factor; it is now a strategic competitive advantage. A PPA helps to combine long-term cost predictability, Scope 2 reductions and regulatory requirements such as the CSRD and the GHG Protocol within an integrated energy procurement strategy.
Understanding Scope 2
The biggest factor influencing your carbon footprint is your electricity consumption.
According to the GHG Protocol standard, Scope 2 emissions from purchased electricity are classified as your company’s indirect greenhouse gas emissions. Unlike Scope 1 (own sources) or Scope 3 (supply chain), Scope 2 emissions can be Scope 2 emissions from purchased electricity are classified as your company’s indirect greenhouse gas emissions.. Unlike Scope 1 (own sources) or Scope 3 (supply chain), Scope 2 emissions can be Under the GHG Protocol’s market-based approach, it is not the grid mix but your specific electricity contract that determines the emission factor.
A Power Purchase Agreement replaces ‘grey’ grid electricity with verifiably renewable energy sourced directly from the generation source. The emission factor drops to zero— documented by guarantees of origin. This allows Scope 2 emissions to be reduced without changing production processes. Anyone who takes a holistic view of Scopes 1, 2 and 3 will recognise that Scope 2 is the fastest and most cost-effective way to reduce CO₂ emissions in industry.
The Power Purchase Agreement is the direct, market-based route to Scope 2 reductions — with audit-proof verification in accordance with the GHG Protocol.
Scope 1
Direct emissions from our own sources (combustion, vehicle fleet)
Scope 2 · PPA
Purchased electricity and heat (in focus)
Scope 3
Value chain (suppliers, logistics, products)
Implementing Scope 2 reductions within the company?
We work with you to develop the right PPA strategy for your industrial decarbonisation.
The Solution
What is a Corporate PPA?
A Corporate Power Purchase Agreement is a long-term bilateral electricity supply contract between your company and a renewable energy producer. Over a term of around ten years, a PPA supplies energy directly from wind or solar power plants — without going via government subsidy schemes. This means that the PPA electricity contract is structured in line with market principles and is independent of the EEG.
Unlike traditional electricity tariffs or purely green electricity offers, a PPA combines three advantages: predictable prices over the entire term, verifiable origin of the electricity from a specific plant, and a direct contribution to the expansion of renewable energy. This is precisely what makes it not only sustainable, but also an increasingly relevant tool for securing stable long-term prices in times of growing uncertainty.
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PPA: Bilateral market contract, freely negotiable between your company and a plant operator
EEG: Government feed-in tariff, regulated under the Renewable Energy Sources Act
Green electricity tariff: Reseller model with no direct link to a specific generation plant
PPA vs. EEG vs. green electricity tariff
PPA-Types
Eight models in two dimensions.
Which PPA model is right for your business depends on your location, your demand profile and your ESG strategy. To help you quickly identify the most suitable option, we categorise corporate PPAs into two dimensions:
The first dimension is the supply structure – in other words, the route by which the electricity reaches you: from a direct connection on your premises, through supply via the public grid, to purely financial hedging without any physical flow of electricity. The second dimension is the pricing structure – this determines how supply volumes and remuneration are structured over the entire term, from off-the-grid procurement to a constant base load.
Both dimensions can be freely combined, and every supply structure can be implemented as a PPA with guarantees of origin. This allows you to create, from eight building blocks, exactly the model that suits your consumption and your climate targets.
By delivery structure
Onsite PPA
Direct connection to the factory site. Maximum transparency, minimum network charges.
Offsite PPA
Delivery via the public network. Location-independent and flexibly scalable.
Sleeved PPA
Vattenfall acts as an intermediary – you negotiate directly with the producer.
Financial PPA
Pure price hedging via a contract for difference – without any physical transfer of electricity.
By price structure
Pay-as-Produced
They consume electricity in exactly the same amount as is generated.
Pay-as-Forecasted
Delivery based on a forecast or a specified quantity.
Pre-defined Profile
Delivery follows a strictly defined hourly schedule.
Baseload
Constant hourly withdrawal volume – ideal for consistent consumption patterns.
Green PPA*
Each of these four supply structures can be implemented as a Green PPA*: with linked guarantees of origin to provide seamless proof of the renewable source of the electricity. Certification of the electricity supply using guarantees of origin is possible in all Vattenfall PPA models.
Proof of Origin and Certificates
Here’s how to provide audit-proof evidence of the renewable nature of your electricity and your Scope 2 reduction.
Guarantees of origin document that the electricity purchased actually comes from a specific renewable energy plant. They are a prerequisite for your Scope 2 reduction to be recognised under the GHG Protocol and the CSRD. All guarantees of origin for electricity from German plants are centrally managed in the Federal Environment Agency’s Register of Guarantees of Origin. Do your documentation requirements go beyond guarantees of origin? We also facilitate their use for hydrogen/RFNBO production or combined supply.
Proofs of origin from the register
Electronic documents in the official UBA Register of Proof of Origin.
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Each HKN represents one megawatt-hour of HKN electricity from a specific renewable energy plant. Guarantees of origin for electricity are recorded for every MWh supplied..
Guarantees of Origin
TheEuropean equivalent on the German certificate of origin for electricity.
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EECS-conform and suitable for cross-border record-keeping within international group structures.
HKN-Price & Price trends
Transparently set out in the Power Purchase Agreement for the entire term.
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The Guaranteed Origin of Electricity (GOE) price is determined by the market and reflects demand for green electricity products. In the Power Purchase Agreement, the GOE price is fixed transparently for the entire term..
Your personalised business case?
During a no-obligation initial consultation, we will work with you to assess the financial implications of a PPA for your business.
Decarbonisation journey
From the status quo to carbon neutrality in four stages.
The decarbonisation of industry is not a sprint, but a structured journey. For climate-neutral companies, renewable energy sourced through power purchase agreements is the key Scope 2 lever. On the path to corporate climate neutrality, the cPPA is stage three of the four-stage roadmap: the step that combines the greatest impact with the least operational effort. Renewable energy for businesses thus becomes a strategic option rather than a risk.
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1
Stock analysis
Measure your carbon footprint, analyse your consumption profile, and review your ESG targets and CSRD requirements. The industrial energy transition begins with transparency.
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2
Roadmap
Prioritise levers according to their impact and cost. Which measures will lead most quickly to the company achieving carbon neutrality? Which investments are most likely to pay for themselves?
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3
PPA-Implementation
The Power Purchase Agreement as the primary Scope 2 lever. Secured for the long term, structured in line with market principles and with an immediate impact on your carbon footprint.
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4
CSRD-Reporting
CSRD-compliant evidence of the reductions you have achieved, updated annually. Renewable energy for businesses becomes measurable and communicable — both internally and to stakeholders.
Your consumption profile & the PPA-Mix
This is how a corporate PPA meets your electricity needs – hour by hour.
Wind and solar complement each other throughout the day and the week: wind generates power mainly at night and during the transitional seasons, whilst solar generates power at midday. For a typical industrial profile, a well-structured wind-solar mix covers around four-fifths of annual consumption. The remainder is sourced transparently via the spot market, and any surplus is sold.
Your advantages at a glance
Predictability
Around 10 years’ price certainty
Whilst the spot market fluctuated between 40 und 380 €/MWh, your PPA price remains fixed for the entire term. This allows for planning across several investment cycles.
Impact on the climate
0 g CO₂/kWh market-based
A Power Purchase Agreement reduces your Scope 2 emissions factor to zero — as documented by guarantees of origin issued directly by the generation plant.
Compliance
CSRD-compliant from day one
Every Vattenfall PPA supply certificate meets the reporting requirements under the CSRD und GHG Protocol — without the need for further processing by your ESG department.
Why Vattenfall
Frequently Asked Questions
<span class="h4" style="display:block; text-align:left; margin-bottom:0;">These are the questions industrial customers ask most often.</span>
A Corporate Power Purchase Agreement is a long-term bilateral electricity supply contract between a company and a renewable energy producer. The term is usually around ten years. For companies, the PPA is therefore a reliable procurement strategy for securing a predictable, long-term supply of green electricity.
A Power Purchase Agreement is a bilateral market contract, freely negotiable between two parties. The EEG, by contrast, is a government feed-in tariff. PPAs operate independently of subsidy policy; direct PPA marketing operates on market principles and is not dependent on political subsidy cycles.
A corporate PPA reduces your Scope 2 emissions, but only under the GHG Protocol’s market-based method. Under the location-based method, everything remains the same: what counts is always the average grid mix in your region, regardless of where your electricity is contractually sourced from.
The deciding factor is the certificates of origin. With a green electricity PPA, you receive these along with the electricity. You can then account for the PPA electricity at 0 g CO₂ per kWh, and your Scope 2 emissions will fall accordingly.
For your PPA to count, the GHG Protocol requires three things:
- Unambiguous allocation of certificates: The certificates belong solely to you. You must not resell the renewable attributes, and no one must count them twice.
- Promoting new installations: Ideally, your PPA should trigger the construction of new renewable energy installations. Existing installations do not deliver any additional climate benefit, and this is usually insufficient for credible net-zero targets (such as those under the SBTi).
- Accurate accounting: Your volumes fit within your own balancing group and correspond plausibly with your consumption in terms of timing and region.
Outlook: The GHG Protocol is currently revising its Scope 2 rules. In future, generation and consumption may need to align more closely in terms of timing – down to the hour – and regionally.
A Green PPA* is a power purchase agreement for certified renewable electricity, fully documented by guarantees of origin issued directly by the generation plant. Green PPAs* therefore meet the most stringent requirements for Scope 2 reporting and the CSRD. The industry generally refers to Green PPAs* simply as PPAs.
You will receive HKN electricity certificates from the official certificate of origin register, which can be clearly linked to the generation plant specified in your Power Purchase Agreement. On request, we can also provide European Guarantees of Origin (GO). The price of the certificate of origin is included in the PPA package.
Further articles on the subject of cPPA
Downloads
CPPAs – The new path to greater sustainability for your business. For further information, you can download additional documents here.
* The term Green CPPAused on this website refers to renewable energy power purchase agreements (CPPAs). We use this term solely for the sake of simplicity.