Our Energy team has advised Statkraft on its Power Purchase Agreement (PPA) with Brockwell Energy and Encyclis. The PPA for Earls Gate Energy Centre (EGEC), located in Grangemouth, Falkirk, is the first to be signed by Statkraft for an Energy from Waste (EfW) project where there is significant onsite demand. 

The PPA procurement process for EGEC was led by Brockwell Energy Services and they selected Statkraft as part of their ongoing Managed Service Agreement for EGEC. The project has a total installed capacity of 23MW but, as there will be onsite demand for power and steam, the expected export capacity will typically be around 12.5MW. The project was designed specifically to meet the current and forecast steam and power demands of the adjacent industrial off-takers. 

As EGEC was project financed, it was important to have an offtake contract in place so that there was a clear route to market for power and Renewable Energy Guarantees of Origin (REGOs).

Brockwell led the development and construction of the project, and their asset management team will assume responsibility for the operation and maintenance of the site. As part of their tender process, Brockwell had specific requirements regarding the ability to fix and unfix power prices and to be able to forward fix prices multiple seasons ahead. There was also a requirement for the PPA to allow volumes to be increased in the event that onsite demand is lowered and to be reduced in the event that onsite demand expands as more onsite parties are supplied. Any unhedged volumes are to be settled at day-ahead prices.    

Statkraft has been a consistent part of the UK PPA market for many years, having signed its first UK PPA in 2010. The Statkraft PPA portfolio mostly consists of intermittent generation but also includes several long-term baseload PPAs for biomass and EfW.  

Gowling WLG has advised Statkraft on UK PPAs since 2010. The legal team advising Statkraft was led by Gus Wood (Partner), supported by George Nixon (Associate).