Fuel Supply Agreement Power Sector

A purchase agreement is generally defined as a contractual agreement where by which a third party agrees to purchase all or part of the project`s production and normally in the long term. It is therefore clear that purchase agreements are of the utmost importance in the structure of a project financing transaction. Cash is the king of project financing and purchase agreements are the instruments under which cash flows are generated by the project company. However, based on such a definition, it is obvious that there may be projects without a purchase agreement and we will try to describe such cases at the end of this section. Finally, the EAA has established that Quezon can supply electricity that goes beyond the minimum quantity set out in the contract, which costs 70% of the capacity charge and 100% of the fixed and variable charges The electricity sector is certainly the investment sector where such agreements have evolved the most and the longest. implementing agreements used in pipeline projects, with the shipper(s) committing to supply a minimum quantity of oil or gas sufficient to ensure a predetermined revenue stream to the project company; (otherwise, the shipper would still be required to make a payment corresponding to the project company, sometimes referred to as the payment of a default); and in developing countries, BOT, BTO and DBFO contracts offered energy suppliers with reduced liquidity the opportunity to finance investments in investments in more efficient installations without relinquishing control over electricity generation (since it is the buyer who decides when the electricity will be evacuated from the installation, i.e. when the installation will be used to generate electricity). the supply of electricity to the consumer or the costs of supplying electricity to the consumer – in other words, the private sector provides the service on behalf of the public sector, but under the control of the public sector. .

. .