The LevelTen Marketplace features data and analytics on nearly every renewable energy project under development in North America, and each quarter we aggregate that data into our quarterly PPA Price Index. This report is intended to give renewable energy buyers a glimpse at PPA prices in different regions of the country, and to evaluate fluctuations over time. We always note, however, that PPA prices are not the same as PPA values; it's important to look at how a PPA is expected to settle, not just its price (LevelTen uses industry-leading analytical tools to do this for clients).
The Q1 2020 PPA Price Index report covers five independent system operator (ISO) regions in the United States, including CAISO, ERCOT, MISO, PJM and SPP, and includes a survey of renewable energy developers with projects on the LevelTen Marketplace. This quarter, we also talked to analysts at Wood Mackenzie and Energy Innovations to get their take on the data, and included three special market reports.
Here are a few highlights from the LevelTen Energy Q1 2020 PPA Price Index:
- Across markets, an evenly-weighted index of P25 wind and solar prices increased $1.20 per megawatt hour (MWh), or 3.7% quarter-over-quarter.
- The aggregate increase in prices was driven by an increase in prices for wind, with all major markets either flat or increasing quarter over quarter, following on a similarly broad, although less pronounced, rise last quarter. Solar prices fell slightly by 0.5%.
- Year-over-year, P25 solar prices dropped 0.9% and P25 wind prices have risen 14.9%.
- Aside from competition, in Q1 2020, half of the developers surveyed stated that "Required Internal Rate of Return" (IRR) and "Federal Regulations" had the most significant impact on their PPA offer prices.
In this quarter's report, you'll also find three special reports related to corporate renewable energy procurement, including:
- A look at how COVID-19 is affecting the industry
- How the Minimum Offer Price Rule (MOPR) in PJM could affect corporate renewable energy procurement
- A special look at the MISO energy market, including PPA values, what types of projects are under development in the region, and how the interconnection queue is causing development challenges
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