Which Is the Better Option in Mexico?
We expect PPAs to continue to be a “win-win” for market participants in Mexico. They allow for lower costs of capital (for both consumers and developers) and higher asset values on the open market. These agreements also demonstrate to regulators a commitment to renewable energy and compliance with new regulations. PPAs are not without risks, but scrutiny of various contract terms, and transparent negotiations, can make PPAs a viable option.
PPAs act as a new type of subsidy for participants. Consumers can purchase power for a lower price than from the grid, and developers receive lower-cost funding. For consumers, this can be a daunting task, especially as a 15- or 20-year agreement would typically be the longest commitment that the company has entered into. Please contact us to learn more about our solutions to lower operating costs through the use of PPAs, while mitigating execution and performance risks.