Frequently asked questions
Understand Reel and its electricity
products for your company.
Electricity from Reel
Reel is an electricity provider that offers companies three distinct electricity products. With Reel's guidance, you can combine these products for the optimal electricity portfolio:
1) Spot electricity: Standard electricity from the spot market, with hourly variable pricing.
2) Spot + Power Purchase Agreement: A portion of your electricity consumption is purchased from a new wind or solar park, built as a direct result of your purchase. Your remaining consumption is covered by a spot electricity agreement. This product offers partially fixed electricity prices, CO2 emission reductions, and unique storytelling and brand opportunities.
3) 24/7 Power Purchase Agreement: Your total annual electricity consumption is covered by wind and solar energy from new and existing parks. The electricity price is fully fixed for all hours of the year. This product offers the largest budget safety, CO2 emission reductions, and unique storytelling and brand opportunities.
All three of these electricity products include access to Reel Solutions, a comprehensive electricity data hub for your company. See: What is Reel Solutions?
A Power Purchase Agreement (PPA) is an electricity contract between a renewable energy developer and a company. With a PPA, your company commits to purchasing electricity from a new renewable energy project (e.g., a solar or wind park) at a fixed price for a fixed period of time.
The renewable energy developer builds the renewable energy project as a direct result of the PPA (and other PPAs depending on how much you buy). The amount of electricity purchased in each PPA is typically only a portion of your total electricity consumption: you choose how much electricity you want to buy at a fixed price from the new project.
An important detail: Via Reel, you buy electricity directly from the new renewable energy project - you are not consuming the electricity from the project. Instead, Reel facilitates a contractual link between you and the renewable energy developer.
For more on PPAs, read our blog post: The most effective green power solution for businesses.
When you enter a Power Purchase Agreement (PPA), you commit to buying a fixed amount of electricity, at a fixed price, for a fixed period of time, directly from a new solar or wind park.
The new solar and wind park is built as a direct result of your PPA. This means that the PPA is essential for building more renewable energy (it is ‘additional’). And because you pay a fixed price for the electricity, a PPA is a hedge against volatile electricity prices.
When you buy electricity through a normal electricity agreement (i.e., a 'spot' agreement), you buy the electricity from the wholesale market (e.g. Nord Pool). This agreement does not offer sustainability or price hedging benefits.
With Reel, you will sign a spot agreement, with the option to sign a PPA to match part of your electricity consumption with fixed-cost, renewable energy.
There are financial and sustainability benefits to signing a PPA.
Financial benefits: (Long-term) price hedging and budget safety; low prices.
With a PPA, your company purchases a fixed amount of electricity, at a fixed price, for a fixed period of time. This protects your company from the increasingly volatile prices of electricity while providing budget certainty on your electricity costs. PPA prices are typically the lowest fixed prices on the market, so you are also buying electricity cheaply.
Sustainability benefits: Valid sustainability claims and branding opportunities.
With a PPA, your company is responsible for the construction of a new solar or wind park. This act is additional, meaning it results in a real world impact that would not have happened otherwise. Additionality is increasingly crucial for the validity of sustainability claims - companies that don’t incorporate additionality into their sustainability strategies risk accusations of greenwashing. When it comes to storytelling and your brand, the creation of a new solar or wind park is an inspiring climate story that few companies can make claim to. Your company will stand out while accelerating the energy transition.
For more on PPAs and storytelling, visit our page: How to talk about your PPA.
Your company pays a fixed price for the electricity it buys from a PPA. This gives your company budget certainty and protects against volatile electricity prices and potential price hikes.
At Reel, your PPA is priced below credible, third-party estimates of the future expected price of electricity. This increases your likelihood of long term cost-savings (but is not a guarantee of savings relative to the fluctuating market).
Reel will work with you to craft the optimal PPA to achieve your company’s financial and sustainability objectives. Book an intro meeting to learn more.
Once you have switched to Reel as your electricity provider, you can sign a Power Purchase Agreement (PPA):
- Reach out to our sales team to book a meeting.
- Our digital energy advisor will audit your current electricity consumption to create a customised PPA proposal based on your financial and sustainability goals.
- Once the PPA terms are agreed upon (price, amount, duration, etc.), you will have 2 to 3 weeks to sign the PPA.
- After the PPA is fully matched (more than one company will sign the same PPA, each purchasing a fraction of the project's expected electricity production), construction of the new wind or solar park will begin. You can monitor the progress on Reel’s platform: Reel Solutions.
- You will receive a monthly invoice from Reel, covering both your standard electricity agreement and any active PPAs.
When your company has a Power Purchase Agreement (PPA) and the wind or sun doesn’t shine, your electricity consumption remains unaffected. Your company continues to draw electricity directly from the grid, ensuring a consistent supply of electricity. In these hours, you are billed at the hourly spot price, unless you choose a 24/7 PPA, in which case we offer a fixed price on all hours.
Sustainability
Yes, a Power Purchase Agreement (PPA) reduces your company’s emissions. There are two ways to measure the carbon emissions of a company’s electricity use:
- Location-based method: This measures the carbon emissions of the electricity a company physically consumes.
- Market-based method: This measures the carbon emissions of the electricity that a company buys.
A PPA reduces your company’s market-based emissions. With a PPA, your company buys renewable energy directly from a new solar or wind park, which is built as a direct result of your PPA. The electricity produced by the park offsets the impact of your electricity consumption.
A PPA does not directly reduce your company's location-based emissions. With a PPA, your company continues to consume electricity from the electricity grid, which is a mix of all power sources in a given area. One new solar or wind park is typically too small to significantly change the grid's overall emissions, though each park does make the grid greener.
Power Purchase Agreements (PPAs) are the only electricity contract that result in the construction of new solar and wind parks. In doing so, they accelerate the renewable energy transition. The link between entering a PPA and the construction of a new solar or wind park is called ‘additionality’.
Standard renewable electricity contracts include the purchase of renewable energy certificates, also known as Guarantees of Origin. These contracts do not help create new, renewable energy - in other words, they have no ‘additionality’. Their lack of real-world impact is well-documented by science1.
1 Bjørn, A., Lloyd, S.M., Brander, M. and Matthews, H.D. (2022). Renewable energy certificates threaten the integrity of corporate science-based targets. Nature Climate Change, [online] 12(6), pp.539–546. doi:https://doi.org/10.1038/s41558-022-01379-5.
Additionality is a crucial metric which says that you can only make a claim, such as I have “purchased green electricity” if your purchase is what made that renewable energy production happen. Power Purchase Agreements (PPAs), the unique electricity contracts offered by Reel, are additional because they result in the construction of new solar and wind projects that would not have been built otherwise.
Additionality is essential for validating sustainability claims. Without it, claims of reducing emissions or having had other positive impacts may be viewed as empty promises, leading to accusations of greenwashing. With a PPA from Reel, your company can validly claim that it is accelerating the energy transition without fearing accusations of greenwashing.
For more on additionality, read our blog post: What is additionality?
It depends on how much PPA-power your buy. If your PPA equals your annual consumption, you will be 100% “green” and have zero-emissions.*
*This is when calculated using the market-based method.
For more on calculating your emissions, read our answer to: Does a PPA reduce my company’s carbon emissions?
When your company signs a Power Purchase Agreement, a new solar or wind park is built and connected to the electricity grid. This means that the electricity it produces is added to the pool of electricity that everyone consumes from - your company does not directly consume the renewable electricity from its PPA.
Your company purchases the electricity from its PPA while continuing to consume electricity from the electricity grid (which is made greener by the PPA). In return, your company benefits from emission reductions, valid sustainability claims, and budget certainty.
For more on budget certainty, read our answer to: Does my company save money with a PPA?
Reel collaborates closely with the developers of its renewable energy projects to promote thriving biodiversity. Reel works with developers to implement its biodiversity guidelines, which includes ensuring that new projects are situated at appropriate distances from natural habitats, that wildflowers are planted, and space is left for animals to roam freely.
About Reel
Reel is a B2B electricity provider and balancing responsible party. We specialise in Power Purchase Agreements (PPAs), unique fixed-price contracts that support the development of new renewable energy projects.
With Reel, it is possible to combine different electricity products. We work closely with every customer to develop a tailored energy portfolio that maximizes budget certainty and environmental impact.
For more on our electricity products, read our answer to: What electricity products does Reel offer?
The process is easy and straightforward:
- Reach out to our team to tell us a bit more about you. Book a meeting here.
- Before or after the meeting, you can give Reel insight in your electricity consumption to receive a tailored offer. You can do so here.
- A representative from Reel will walk you through a tailormade proposal and offer to switch to Reel as your electricity provider.
- Reel will handle everything related to the switch of electricity provider.
- You will receive a monthly invoice from Reel for all delivered electricity - just as you do today.
- Reel will find and offer you PPAs on a rolling basis, and handle everything in the process.
Note: You must switch to Reel as your electricity provider in order to sign a Power Purchase Agreement (PPA).
For more on singing a PPA, read our answer to: How can my company sign a PPA with Reel?
Reel is a one-stop shop for all your electricity needs. We only offer Power Purchase Agreements (PPAs) to customers with Reel as their electricity provider.
If you are currently bound by an existing electricity agreement, you can sign a electricity agreement that will automatically switch your company to Reel as its electricity provider once your current electricity agreement terminates. If necessary, Reel can begin by providing electricity to a subset of your metering points.
Reel Solutions is a comprehensive electricity data hub, offered to all customers of Reel. With it, companies can:
- Receive customized energy strategies: Reel continuously analyzes your company's electricity consumption and develops tailored renewable energy procurement strategies to help you achieve your financial and sustainability goals.
- Visualize electricity consumption, production and emissions: Monitor your company’s electricity consumption and associated emissions. Extract this data for accurate sustainability reporting.
- Monitor your PPAs: Track the construction progress of your PPA’s new solar or wind park and use the provided content (images and copy) to craft engaging and unique stories.
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Still have questions?
Reach out to our team and we’ll be happy to walk you through the answers.