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Virtual Power Purchase Agreement

Virtual Power Purchase Agreement Template for United Arab Emirates

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Key Requirements PROMPT example:

Virtual Power Purchase Agreement

"I need a Virtual Power Purchase Agreement for a 100MW solar project in Dubai, where my tech company will be the corporate buyer, with settlement in UAE Dirhams and a planned commercial operation date of March 2025."

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Document background
This Virtual Power Purchase Agreement template is designed for use in corporate renewable energy procurement within the United Arab Emirates legal framework. It is particularly relevant for organizations seeking to meet sustainability goals and manage electricity costs without physically receiving power from a renewable energy facility. The agreement establishes a financial settlement structure where the corporate buyer agrees to a fixed price for electricity, settling the difference against market prices with the project developer. This document incorporates UAE-specific regulatory requirements, including compliance with local energy laws and regulations, while addressing key commercial terms such as settlement mechanisms, environmental attributes, and risk allocation. It is suitable for both conventional corporate buyers and those requiring Sharia-compliant structures, with flexibility to accommodate various renewable energy technologies and project sizes.
Suggested Sections

1. Parties: Identification of the parties entering into the VPPA

2. Background: Context of the agreement, including project overview and parties' intentions

3. Definitions and Interpretation: Defined terms, rules of interpretation, and calculation principles

4. Term and Conditions Precedent: Duration of agreement and conditions that must be met before agreement becomes effective

5. Project Requirements: Specifications of the renewable energy project, including capacity and technology type

6. Settlement Obligations: Core VPPA settlement mechanics, including strike price and calculation methodology

7. Metering and Reporting: Requirements for measuring and reporting energy production

8. Payment Terms: Timing and mechanics of settlements, including currency and payment method

9. Environmental Attributes: Treatment of renewable energy certificates and other environmental benefits

10. Force Majeure: Events excusing performance and associated procedures

11. Default and Termination: Events of default, cure periods, and termination rights

12. Liability and Indemnification: Allocation of risks and liability between parties

13. Dispute Resolution: Procedures for resolving disputes, including jurisdiction and governing law

14. Confidentiality: Protection of confidential information and permitted disclosures

15. Boilerplate Provisions: Standard contract provisions including notices, amendments, and assignment

Optional Sections

1. Forecasting and Scheduling: Required when the project needs specific production forecasting requirements

2. Credit Support: Include when parties require security for payment obligations

3. Change in Law: Detailed provisions for regulatory changes, particularly relevant in emerging renewable markets

4. Market Disruption: Include for markets with potential electricity market structure changes

5. Insurance: Detailed insurance requirements if not covered in project agreements

6. Local Content Requirements: Include if project must meet UAE local content requirements

7. Sharia Compliance: Required for Islamic finance structures or when parties require Sharia compliance

8. Carbon Pricing Mechanisms: Include if carbon credits or pricing are relevant to the agreement

Suggested Schedules

1. Project Specifications: Technical details of the renewable energy project

2. Settlement Calculations: Detailed methodology for calculating settlement amounts

3. Metering Specifications: Technical requirements for metering and monitoring

4. Form of Guarantees: Templates for any required guarantees or security

5. Contract Prices: Strike price and any adjustment mechanisms

6. Operating Parameters: Performance standards and operational requirements

7. Form of Reports: Templates for required operational and settlement reports

8. Key Milestones: Project development and operation timeline

9. Notices: Contact details and notice requirements for all parties

10. UAE Compliance Requirements: Specific local law compliance requirements

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Linkedin in social icon imageX social icon image
alex.den.21@genieai.co
Relevant legal definitions
Actual Generation
Affiliate
Agreement Date
Annual Contract Quantity
Availability
Billing Period
Business Day
Buyer
Change in Law
Commercial Operation Date
Contract Price
Contract Year
Credit Support
Delivery Point
Designated Court
Effective Date
Environmental Attributes
Event of Default
Facility
Financial Settlement
Force Majeure Event
Generator
Governing Law
Green Benefits
Grid
Installation Capacity
Lender
Market Price
Metering Data
Metering Device
Minimum Generation Guarantee
Notice
Operating Parameters
Performance Security
Project
Project Company
Reference Price
Renewable Energy Certificate
Settlement Amount
Settlement Period
Strike Price
Term
Termination Date
Transmission System
UAE Business Hours
UAE Dirham
Clauses
Definitions
Term
Conditions Precedent
Project Development
Settlement Obligations
Payment Terms
Metering
Environmental Attributes
Generation Requirements
Performance Standards
Force Majeure
Change in Law
Default
Termination
Liability
Indemnification
Insurance
Assignment
Confidentiality
Dispute Resolution
Governing Law
Notices
Representations and Warranties
Credit Support
Reporting Requirements
Market Disruption
Compliance with Laws
Anti-Corruption
Data Protection
Amendments
Waiver
Severability
Entire Agreement
Counterparts
Third Party Rights
Relevant Industries

Renewable Energy

Manufacturing

Technology

Financial Services

Real Estate

Industrial

Retail

Healthcare

Telecommunications

Data Centers

Relevant Teams

Legal

Sustainability

Finance

Procurement

Risk Management

Treasury

Environmental Compliance

Project Development

Corporate Strategy

Operations

Relevant Roles

Chief Sustainability Officer

Energy Procurement Manager

Legal Counsel

Chief Financial Officer

Sustainability Director

Risk Manager

Environmental Compliance Manager

Power Purchase Agreement Specialist

Renewable Energy Developer

Project Finance Manager

Corporate Treasury Manager

Environmental Social Governance (ESG) Manager

Industries
Federal Law No. 2 of 2014: The primary commercial companies law in the UAE, which governs all types of commercial transactions and contracts, including energy purchase agreements
UAE Energy Strategy 2050: Sets the framework for renewable energy targets and clean energy initiatives in the UAE, affecting how VPPAs are structured and implemented
Federal Law No. 24 of 1999: Law concerning the protection and development of the environment, relevant for environmental compliance aspects of energy projects
Federal Law No. 4 of 2012: Regulation of competition, which may affect pricing mechanisms and market behavior in energy contracts
Dubai Law No. 6 of 2011: Regulates the participation of the private sector in electricity and water production in Dubai, crucial for power purchase agreements
Abu Dhabi Law No. 2 of 1998: Regulation of the water and electricity sector in Abu Dhabi, including provisions for power generation and purchase agreements
UAE Central Bank Regulations on Derivatives: Regulations governing financial derivatives and settlement mechanisms, relevant for the financial settlement aspects of VPPAs
Federal Law No. 18 of 1993: Commercial Transactions Law, governing payment terms, financial settlements, and commercial obligations
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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