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Normal green electricity contracts do not ensure that new renewable energy is added to the grid; they have no ‘additionality’. This is well-documented by science. For a recent, comprehensive review, see this article.

PPAs, on the other hand, are directly tied to the construction of new solar and wind parks. This means they accelerate the renewable energy transition and create real CO₂ reductions on the electricity grid. The link between entering a PPA and the construction of a new solar/wind park is called ‘additionality’.

PPAs are related to your ‘market-based’ scope 2 results, i.e. the electricity you have bought. If you consume 10 GWh/year and enter PPAs corresponding to 10 GWh/year, then your scope 2 market-based results will be zero emissions. Your CO₂-results don’t change before your PPA goes live.

Your location-based results (the electricity you consume) will not change, though Reel will report and quantify the marginal improvement of the new solar/wind park (built as a direct consequence of the PPA) on the electricity grid.

Read Reel’s white paper for a general overview of how CO₂ emissions are connected to the electricity you buy and consume.

Reel automates hourly reporting of scope 2 emissions from electricity via our platform. We use electricity data from the Danish Energinet Datahub, and CO₂ data from Electricity Maps. We verify results based on standards from the Greenhouse Gas Protocol.

When you enter a PPA, you commit to buying a fixed amount of electricity, at a fixed price, for a fixed period of time, directly from a new solar or wind park. Via Reel, you enter the PPA directly with the producer of renewable energy and thereby buy electricity directly from the source.

To be clear, this does not mean that there is a direct wire from the solar or wind park to you. Instead, Reel facilitates a contractual link between you and the producer. Your PPA commitment ensures financing for the new solar and wind park. This means that the PPA is essential for building more renewable energy (it is additional).

When you buy electricity through a normal electricity agreement, you buy the electricity from the market via your electricity provider. The simplest electricity agreement is a ‘spot’ agreement, which follows the hourly electricity price on the pan-European Power Exchange Nord Pool.

PPA prices are negotiated for each project with each renewable energy producer. Reel does not set the PPA price but negotiates the price with the producer on behalf of you. Our extensive network of renewable energy producers ensures that we always fetch the best PPA prices in the market.

PPAs are priced below our current view of the forward-market (i.e. the future expected price of electricity, based on third-party credible sources).

Longer PPAs have lower prices - i.e. a 10-year PPA is priced lower than a 5-year PPA. Because PPAs are longer-term contracts than normal electricity agreements, PPA prices are also much more attractive than what you can fetch on 1-3 year fixed price agreements.

You are not guaranteed to save money on the PPA (relative to the market), but you are guaranteed to always be offered the most attractive long-term fixed price available on the market in a given period. Therefore, the risk that the PPA ends up being higher than the market, is smaller than a normal fixed price agreement.

Reel is your one-stop-shop and only counterpart. We handle all matters related to finding, negotiating, signing, delivering/balancing, invoicing and reporting on the PPA. You do not need to engage with the renewable energy producers or balancing responsible parties.