An energy ministry decision offering incentives for RES projects incorporating power purchase agreement (PPAs) plans has led to a flurry of such preliminary agreements between RES producers and industrial energy consumers.

Applications representing over 6 GW in RES projects incorporating PPA agreement plans have been submitted to power grid operator IPTO. This group of projects has been offered priority status for grid connections, through a ministerial decision reached in August.

On the other hand, PPAs with RES producers are crucial for industrial enterprises, pressured by higher energy costs. Many industrial enterprises face expiring supply agreements with power utility PPC that were established at prices well below current levels.

The energy ministry aims to further establish the dissemination of bilateral contracts between renewable energy investors and large-scale consumers or electricity suppliers by easing capacity limits on RES projects incorporating PPAs. This move will offer additional grid capacity of between 2.5 and 3 GW for such projects.

It remains unclear if this higher capacity for RES projects incorporating PPAs will be made gradually or through one step. A decision on this detail is expected imminently.