Organisations intending to install electric vehicle charging points (EVCPs) and electricity-based heating systems in order to maximise the use and environmental impact of electricity supplied under a private wire agreement (PPA) are encouraged to check that their scheme does not unwittingly put them in breach of the terms of their PPA.
The trend of business and other organisations taking steps to reduce their carbon footprint is not particularly new. However, in the current general context of the climate emergency, commitments to attain Net Zero and the more recent rise in gas prices, one can expect the trend towards organisations installing EVCPs and moving towards electrification of heat gaining further traction over the coming years.
Installing EVCPs at a property has many upsides for a business:
In terms of electrification of heat, organisations maybe incentivised to electrify heat in order to:
In each case described above, one aspect that can be overlooked is whether the organisation is permitted to use the electricity for the purposes of charging electric vehicles (EVs) and as a heat source under the PPA that supplies that organisation with electricity.
In the case of EVs, the issue arises due to the PPA containing provisions that prohibit or restrict:
The impact of these clauses on an EVCP project is not difficult to appreciate: the EVs will clearly store electricity, and once the EVs leave the “site” the electricity will be being used away from the area where it is permitted to be used.
The issue arising in relation to electric heating can be less obvious, and can be dependent on how the PPA is drafted. For example, a project to install night storage heaters, or mass-storage of heat in electrically-heated buffer tanks may fall foul of a PPA that prohibits storage of “energy” rather than “electricity” at the site.
Faced with such provisions in a PPA, the organisation has three main options:
Each option has its drawbacks and the approach adopted in any particular case will need to be considered in its specific circumstances, balancing (amongst other things):
Good governance would demand that an organisation planning a EVCP or electrification of heat project:
For those currently party to (or planning on entering into) PPAs:
Our Commercial Team at Ashfords has a wealth of experience in advising on:
This article highlights one aspect which should be the subject of due diligence when embarking on an EVCP or heat electrification project. Please contact Jonathan Croley if you would like to discuss your project in further detail.
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