Baseload PPA – A long-term hedging solution for stable power consumption
For industrial companies, electricity price volatility can significantly impact long-term operating costs and investment planning. A baseload PPA helps secure predictable electricity pricing over the long term. Fortum offers Baseload PPAs in Finland and Sweden with both financial and physical settlement structures.
Why industrial companies choose baseload PPAs
Who is it for?
PPAs (power purchase agreement) are especially relevant for large businesses with substantial energy consumption. They are also a strong fit for companies seeking predictable long‑term energy costs and improved bankability for investment projects.
Baseload PPAs are well suited to cover the share of your energy consumption that stays consistent over time.
How a baseload PPA creates long-term price stability
A baseload PPA is a long-term power agreement where a fixed electricity volume is delivered — or financially settled — every 15 minutes throughout the contract period.
Unlike pay-as-produced PPAs, where volumes vary based on electricity generation, a baseload PPA provides a fixed delivery. For example, the agreement may cover a constant 1 MW delivery every 15 minutes over a 5–20-year period. This makes baseload PPAs particularly suitable for industrial companies with at least partially stable electricity demand that want to mitigate risks with long-term price predictability.
Baseload PPAs with renewable or fossil-free Guarantees of Origin
Baseload PPAs are often bundled with Guarantees of Origin (GOs) from nuclear and hydro power. However, with our large Nordic asset portfolio, Fortum is also able to discuss Baseload PPA contracts including wind and solar power.
How does a baseload PPA work?
A baseload PPA helps companies secure long-term electricity pricing for a fixed share of their future power demand.
In a baseload PPA, the customer and supplier agree on:
- A fixed hourly delivery volume
- Contract duration
- Pricing model
- Settlement model
- Delivery area
Fortum’s baseload PPAs are available with
Financial or physical settlement
Delivery in Finland and Swedish price areas SE2 and SE3
Fossil-free electricity bundled with guarantees of origin (GOs) e.g. hydropower, nuclear power, solar and wind power.
Discuss your baseload PPA needs with our experts
Whether you are looking for long-term price stability or planning future electricity sourcing needs, we can help you evaluate the right baseload PPA solution for your business.
Hedging protects against electricity price volatility and tomorrow’s risk scenarios
One of the Nordics’ main strengths is competitive power pricing, but it shouldn’t be taken for granted. Despite market swings, prices remain among the lowest in Europe. Yet as industrial investment and electrification accelerate, electricity demand could reach a new level. Will Finland still have Europe’s cheapest electricity in ten years? Long-term electricity price hedging brings much-needed predictability to costs—and the confidence to invest.
Recipe for successful PPA, with wind and solar power as ingredients
An increasingly active topic of discussion in the electricity market has been the different types of PPAs. The term PPA stands for Power Purchase Agreement and refers to a long-term power purchase agreement, typically made between the parties for a period of about 10-20 years. PPAs are major commitments for both the power producer and the buyer, and therefore entering into one requires special attention.
Baseload nuclear power helps Swedish industry to reduce carbon emissions at a competitive price
Energy-intensive industries, like the metals and minerals sector, need a lot of stable power for their operations. Nuclear power offers a stable, low-carbon power generation option at a competitive price for continuous energy needs.
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