Document background
The Virtual Power Purchase Agreement (VPPA) is designed for use in New Zealand's electricity market where corporate buyers seek to support renewable energy development while managing electricity costs and achieving sustainability goals. This agreement type is particularly relevant when the buyer cannot or does not wish to take physical delivery of electricity but wants to secure long-term price certainty and environmental benefits from renewable generation. The document includes provisions for financial settlement mechanisms, renewable energy certificate transfers, and risk allocation, all structured within New Zealand's regulatory framework. It addresses key aspects such as price hedging, generation guarantees, and environmental attributes, while ensuring compliance with both electricity market rules and financial market regulations. The VPPA structure is especially suitable for large corporate consumers looking to meet sustainability targets and manage electricity price volatility through long-term financial arrangements with renewable energy generators.
