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Power Purchasing Agreements (PPA) are Softening the Blow in 2020 for Commercial Landlords

There’s no denying that the first half of 2020 has had a big impact on the economy.

As commercial landlords, you’ve seen it from both sides as you supported tenants through reduced trade and financial distress while potentially experiencing your own.

And while government subsidies and supports have helped offset some of the impact and things are looking up as restrictions ease and we settle into the “new normal”, many businesses are still going to be feeling the effects on their bottom line for a while yet.

 

Many of those who were able to keep trading or pivot their business to diversify their income during restrictions still aren’t achieving ideal turnover levels and we’ve seen reopening causing new struggles for some as they try to find ways to make their business viable while adhering to maximum numbers and other operating conditions.

A High Price to Run a Business

While government payments like JobKeeper are helping offset wages cost, the “spend money to make money” adage is true when it comes to the real price of opening a commercial premises. Electricity alone can run into thousands and as much as utility companies are providing concessions, at some point the fees still have to be paid. This has resulted in many businesses operating at reduced capacity.

Happy, successful tenants are good news for your business so the sooner your tenants are back to a profitable business, the sooner your property’s rental income is guaranteed.

Reducing Tenant’s Utilities Bills without Increasing Your Costs

Through a PV Power Purchasing Agreement (PPA), OTI Power supply, install and own the solar system that provides solar electricity to your commercial property. Your tenants benefit from reduced guaranteed pricing for the power they buy from the solar system, while OTI Power take care of the upfront costs and ongoing maintenance of the system.

There are no upfront costs for landlords or tenants which makes it an instantly profitable way that you can help your tenants reduce their overheads.

How PPAs Work

A solar PPA isn’t that different to the way traditional property power supply works where the energy company owns, maintains and charges for supplying your property with electricity. With the traditional grid supply though, the bill payer is at the mercy of the energy company for rates and increases. With a PPA, the rate is locked in when you set it up and OTI Power issue a reduced bill for your tenant’s power usage.

If your property produces more power than the tenants use, your power provider of your choice will buy it off you at competitive rates. This will appear as a credit on your power bill.

OTI Power look to supply a solar system that suits your property’s daily energy consumption, though we do need to take into account things like the surface area available for installation and how much sunlight your property receives to determine the best solar system for your property.

Tenants do still need to maintain a connection with your power company, because they can still use grid supply if their solar isn’t meeting their properties energy usage. While this does mean two bills, the solar rate is considerably cheaper than what they pay traditional energy companies.

Simplified Solar For Landlords
OTI Power has helped a number of commercial property owners connect solar at their tenanted premises.

When you connect a solar system to your investment property through our PPA, you don’t have to worry about anything. OTI Power take care of the network and do routine checks but solar energy systems generally don’t need much in the way of maintenance. In the unlikely event that something goes wrong with the solar power supply, because it’s OTI Power infrastructure, they take care of repairs or warranty claims.

Don’t Take Our Word for It – Our Customers Love OTI Power Too
Professionalism, passion and a people focused approach are at the core of what we do and our testimonials from our residential and commercial customers confirm we’re getting it right.

We offer obligation free quotes and advice so contact us to discuss how we can help give you the power to help your tenants reduce their overheads today.

 

Read further blogs regarding PPA agreements by clicking here.

No-obligation consultation

If you are looking to install a solar system at Sanctuary Cove, Hope Island, Coomera or throughout Australia, be sure to contact the team at OTI Power.

The no-obligation consultation is completely free and you’re under no obligation to take up any of our services. 

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