Competitive Contracting for Privately Generated Power
Author: Robert Bacon Date: 5/1/1995 (PDF, 200KB)
Introducing independent power producers (IPPs) into a power system where existing generators are inefficient can deliver more efficient investment. But it is not sufficient to achieve the operating benefits of competition. Key to determining whether or not the IPPs and the system as a whole will operate efficiently are the power and energy sales contracts with the IPPs. Robert Bacon surveys a range of power purchase agreements and highlights their risks and benefits for operational efficiency.