alt Hacker NewsSorry, but who in his right mind, signs contracts for 20 years - could you have imagined the world today 20 years ago? No and no. All one should do is sign snippet contracts of 5 years with the offer of an option to predefined condition. Split it into 4 sequences with a renewal.
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maxerickson • today at 6:18 PM
The power plant probably amortizes over roughly that period. Price would be higher without a matching purchase guarantee, and so on.
bluGill • today at 4:57 PM
Many people. My house loan was 30 years. Commercial real estate is often 20. Commercial 30 year bonds are common.
Many investments won't pay off unless there is a 30 year plan so lots of investors work on that long term. Even if an investment pays off sooner you often are accounting better off longer terms - see an accountant
Very normal. Here in Europe (well nordics at least) pretty much all the capacity of any wind farm is already sold before construction begins. The PPA (power purchasing agreement) is usually pretty much required to get the loan/funding anyway.
Basically most projects start with the wind company using its own money to find a site and get it approved and then they go and try to find someone to sell the electricity to at a fixed rate before construction begins as selling directly to the spot market has way too much risk for the banks to give loans.
Not sure how different it is in Central Europe with solar as there isn’t much solar up here in the north (just doesn’t make much sense as during the 3 to 4 months in the winter when electricity price is at the yearly maximum you produce effectively nothing)