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European Renewable PPA Prices Continue Remarkable Rise, Up 16% in Q2 and Nearly 50% Year-Over-Year, According to LevelTen Energy

LevelTen News
July 13, 2022
  • LevelTen Energy’s new report reveals that European P25 solar and wind PPA prices* increased 16% in the second quarter of 2022 to 66,07€ per MWh. Year-over-year, prices have increased a staggering 47%. 

  • Despite higher PPA prices, PPA values remain attractive due to wholesale electricity prices that remain elevated. Offtakers should view these long-term energy contracts as an economically compelling option for obtaining high-impact renewable energy certificates (aka GO’s or EAC’s) and locking in electricity rates.

Madrid - 14th July 2022

In the second quarter, European renewable energy buyers saw power purchase agreement prices soar 16% to 66,07€ per MWh, according to a new report from LevelTen Energy, the leading provider of renewable transaction infrastructure and operator of the world’s largest PPA marketplace. Compared to last year, prices are now 47% higher, a staggering increase driven by the region’s complicated energy crisis and inflation.  

“In the simplest terms, PPA prices have been rising for one year because supply cannot keep up with demand,” said Flemming Sørensen, VP of Europe at LevelTen Energy. “There isn’t a clear end in sight to this supply and demand imbalance because its underlying causes will take months or years to resolve. Developers continue to struggle to build new solar and wind projects, which are sorely needed, due to tough permitting and interconnection challenges and the rising cost of inputs and labor. Furthermore, developers now have more options to market and finance their existing projects outside of corporate PPAs, which also limits available supply.” 

European PPA Market Highlights

LevelTen’s Q2 report, covering April to June 2022, shows PPA prices and trends in 13 countries across Europe, including: Denmark, Finland, France, Germany, Greece, Ireland, Italy, Lithuania, Netherlands, Poland, Spain, Sweden, and the U.K. The report is based on actual PPA price offers uploaded onto the LevelTen Energy Marketplace from wind and solar project developers over the last quarter.

Market highlights include:

  • Poland, where P25 solar prices rose 36,2% to 95€ per MWh. Demand for renewable energy PPAs has spiked due to the cessation of natural gas imports from Russia. Supply is struggling to keep up because of burdensome permitting barriers and government auctions. “In Poland, developers can bid half of their project’s production into government auctions. Developers can do whatever they’d like with the remaining project volume not contracted through the auction — like enter into a PPA, or sell into the wholesale market to capture elevated electricity prices,” said Frederico Carita, Senior Manager, Developer Services at LevelTen Energy. Since wholesale electricity prices remain high, many more developers are taking their projects to the wholesale market and forgoing PPAs altogether or raising prices.

  • Italy had the largest share of European PPA offers on LevelTen’s Energy Marketplace (more than 32%). Italian P25 solar PPA prices have soared 22% year-over-year but stayed flat quarter-over-quarter and currently sit at 51.5€ per MWh. In Italy, there are emerging questions around price cannibalization in regions like Sicily, where solar production outpaces solar demand. This dynamic could lead to diminishing revenue for developers and uneconomical procurements for buyers.  

  • Greece made it onto LevelTen’s European PPA Price Index for the first time since its creation in 2020. “While Greek solar offers represent solid values, both buyers and sellers there should be aware of how the Greek market differs from other European ones. Greece’s credit rating is not as strong as some other European nations, which negatively impacts the credit of companies operating there who may be looking to procure,” said Luis López-Polín, Senior Manager of Business Development, Europe at LevelTen Energy.

  • Spanish PPA prices remained relatively stable at 39.50€ per MWh, bucking the trend of rising prices. "In Spain, an abundance of competition and high levels of irradiance make for good opportunities for buyers. Spain has shown more stability and better values compared to many of Europe’s other solar markets,” said Sørensen.

What Do Buyers Need to Know about Procuring in this Market? 
“PPAs are still compelling because PPA value – the potential financial upside of a PPA contract – still remains attractive,” said Sørensen. “In the near term, wholesale energy prices are forecasted to stay elevated but that won’t be the case indefinitely. Buyers that want to maximize their chances of using a PPA as a financial hedge should act now, as projects with 2023 commercial operation dates are nearly all accounted for.” 

Equally important is the environmental value that PPAs deliver. “Greenwashing is a big concern for many offtakers who are focused on hitting their renewable energy goals. PPAs provide the highest amount of benefit to the environment because they drive more renewable generation capacity. Corporations and other offtakers that enter into PPAs get to tell a powerful impact story,” said Sørensen.

Apart from higher PPA prices, LevelTen also reports important changes to the way that PPA contracts are getting negotiated. Its report includes a survey of energy buyers and sellers, of whom approximately 50% said that indexing PPA prices to commodities prices or other capital expenditures is important to getting PPAs signed. 

Take a Deeper Dive Into the Data

To download the free executive summary of LevelTen Energy’s Q2 PPA Price Index, the industry’s only source of data from hundreds of real PPA price offers in Europe and North America, or to purchase the full reports, visit: The executive summary includes an average of the 25th percentile of PPA price offers of each market. The full report includes more detailed price data, in-depth articles and analysis from market experts, survey data, PPA signings, and more.    

*PPA prices in LevelTen’s report are price offers listed by developers on LevelTen’s Energy Marketplace, not transacted PPA prices.

LevelTen Energy

LevelTen Energy is the leading provider of renewable transaction infrastructure, delivering the marketplaces, software, automated analytics, and expertise required to accelerate clean energy transactions. The LevelTen Platform is the world’s largest online hub for renewable energy buyers, sellers, advisors, asset owners and financiers. The Platform includes the LevelTen Energy Marketplace, which delivers access to more than 4,500 power purchase agreement price offers spanning 28 countries in North America and Europe. It also includes the LevelTen Asset Marketplace, which brings together over 800 renewable energy project developers and owners, and delivers the online tools and expertise they need to buy, sell and finance assets quickly. Together, LevelTen and its partners share #OneGoal to accelerate the energy transition.

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