Hi everyone,
Recently started working at renewables developer.
As renewable energy markets mature and many PPAs remain relatively short compared to asset lifetimes (in my market) , I'm curious how market participants think about managing long-term power price risk beyond the initial PPA term.
For a wind or solar asset with a 25-30 year life, a 3-7 year PPA still leaves significant merchant exposure. As renewable penetration increases and power markets become more volatile, how are developers, utilities, IPPs, infrastructure funds, and lenders approaching this challenge?
Some questions that come to mind:
- Are financial hedging instruments becoming a meaningful complement or alternative to long-term PPAs?
- How far forward can electricity prices realistically be hedged in European markets?
- How do lenders view rolling hedge strategies compared to traditional fixed-price PPAs?
- Are there examples of markets where this approach is already well established?
Interested in hearing perspectives from anyone involved in renewable development, power trading or broader energy investing.
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