Renewable energy from the region: Städtische Werke AG concludes innovative electricity supply agreement with SMA

The North Hessian energy specialist SMA Solar Technology AG (SMA) and Städtische Werke AG from Kassel are setting standards when it comes to a climate-friendly energy supply. As part of a long-term electricity supply agreement – or “power purchase agreement” (PPA) – Städtische Werke AG will be supplying the solar specialist SMA with solar energy from a local PV power plant at a set tariff. For SMA, the agreement means price and planning certainty and is an important element of the company’s commitment to a 100 percent renewable energy supply.

“This project represents a milestone in the supply and use of decentrally generated renewable energy,” said Barbara Gregor, CFO at SMA. “Only very few PPAs between companies and electric utility companies have been concluded in Germany, and I am delighted that SMA can once again demonstrate its pioneering spirit. The electricity supply agreement will help cover demand at our headquarters, which have been supplied exclusively with decentrally generated renewable energy from the region since 2020. Our stated aim is to procure 100 percent of our electricity all over the world from renewable sources by 2025. With a global quota of 97.5 percent in 2022, we are already well on track for attaining this goal.”

Städtische Werke AG CEO Dr. Michael Maxelon: “Thanks to the long-term price and planning certainty that we offer, SMA can purchase green energy at a fixed price over the next ten years. This allows us to expand the clean generation of energy locally and strengthen regional value creation in North Hesse. For us, PPAs are a key tool in supporting our customers with appropriate offers on their journey toward decarbonization. This means that we will also develop large-scale PV projects for other major and industrial customers in the future. We are an expert point of contact for complex PPA solutions in the region.”

Background to the power purchase agreement between Städtische Werke AG and SMA

SMA is purchasing all the energy produced by a 5.7 MWp PV system in Niederhohne near Eschwege, enabling it to cover around one third of its entire power requirements at its headquarters in Niestetal and Kassel. Städtische Werke AG in Kassel will take the electricity generated in the PV system and supply it as base load to SMA. Any surplus green energy will be sold by Städtische Werke as lucratively as possible for SMA, with any residual requirements supplemented accordingly. The agreement is part of an existing contract, whereby the price of the solar power is fixed over the long term and so is not dependent on trends in the energy market. This decoupling from the exchange price creates planning and price certainty for SMA. The North Hessian electric utility company Städtische Werke AG is also supplying the rest of the electricity for the SMA site. This electricity also originates from renewable energy sources.