About Us
What is RenewaFi?
RenewaFi is a renewable energy marketplace that helps companies and utilities buy renewable energy directly from clean power facilities.
Instead of spending sizable fees and months of effort to source and evaluate complex energy deals manually, RenewaFi allows companies and utilities to build customized digital auctions for renewable energy, connects them to top responses from power plant developers, and provides analytical tools that enable them to choose the right deals.
What is wrong with the existing way of transacting renewable energy?
Before RenewaFi, the only ways to access the renewable energy market were to hire expensive intermediaries or employ a dedicated staff of professional energy experts, as large corporate buyers like Amazon, Meta, and Google have done.
For most prospective renewable energy buyers, this means spending upwards of a million dollars on deal fees. Even then, deals can take over a year to negotiate. Traditional renewable energy contracting processes may work for the largest businesses in America, but they exclude many others from the renewable energy markets.
Newer entrants to the market seeking to authentically decarbonize and improve ESG scores lack the tools to level the playing field. RenewaFi is the first independent renewable energy marketplace with built-in expertise and patent-pending software tools to offer all market participants a faster, more secure, and more affordable way to source and evaluate renewable energy deals.
Who can join the marketplace?
RenewaFi marketplace participants include companies, factories, utilities, renewable energy developers, sustainability consultants, commodity traders, and investment banks with power trading desks. If your company is looking to buy, sell, or trade renewable energy, please contact us for a demo at info@renewafi.com.
How does RenewaFi help companies looking to buy renewable energy?
Instead of spending sizable fees and months of effort to source and evaluate complex energy deals manually, RenewaFi allows companies to build customized digital auctions for renewable energy, connects them to top responses from power plant developers, and provides analytical tools that enable them to choose the right deals.
A process that once took many months and could cost millions in fees can now be completed in just a few months at a fraction of the cost. In some cases, RenewaFi's fees are 10% of those of a typical intermediary.
How does RenewaFi help developers looking to sell renewable energy?
RenewaFi provides specialized power marketing software for developers to sell renewable energy to corporations, utilities, and commodity traders. Using RenewaFi, developers can proactively power market and showcase deals to top prospects, as well as respond to incoming auctions from prospective buyers.
Is RenewaFi a sustainability advisor?
We are committed to our customers’ success and work closely with them throughout the contracting process whenever needed. Sometimes our market participants need extra guidance and support when curating auctions, evaluating proposals, or even negotiating renewable energy contracts.
Who are your investors?
We are backed by a group of world-class VCs and angels, including:
First Round Capital – An early backer of Uber, Square, Blue Apron, Warby Parker, and Roblox, First Round Capital specializes in early-stage technology companies.
Floating Point– Started by founding team members of Oscar Health, Floating Point focuses on technology companies operating in complex industries.
BoxGroup – An initial investor in Plaid, Airtable, Ramp, Mirror, and PillPack, BoxGroup is one of the leading early-stage VC firms in New York City.
Powerhouse Ventures – A leading climate tech VC firm, Powerhouse Ventures backs founding teams building innovative software to change the way we power our world.
Kiran Bhatraju – The Founder and CEO of Arcadia, Kiran is on the front lines of developing technology to accelerate the energy transition.
Who leads RenewaFi?
Noam Yaffe is the Founder and CEO of RenewaFi.
Prior to RenewaFi, Noam specialized in PPAs at Recurrent Energy, a top 10 renewable energy developer, where he sourced, evaluated and negotiated PPAs with multiple Fortune 500 companies and utilities, including Anheuser Busch, Energy Transfer, and Austin Energy.
Before entering the renewables industry, Noam was a technology M&A investment banker.
About Renewable Energy Finance
What are PPAs?
Power Purchase Agreements are contracts that define the commercial terms for the purchase and sale of renewable energy.
Corporations and utilities use PPAs to procure renewable energy and renewable energy credits (RECs) in bulk at the most competitive prices possible. By entering into a PPA, these buyers secure competitively priced renewable energy – typically for a period of ten to twenty years – to authentically offset their carbon emissions. In many cases, entering into a PPA enables the construction of a new renewable energy facility, a concept known as “additionality.”
For renewable energy project developers, entering into a PPA is almost always a pre-requisite for a proposed clean power project. Developers use PPAs to hedge their exposure to future price volatility and to ensure that their proposed project generates stable cash flows. Once a PPA is signed, developers can approach banks and raise the debt needed to begin constructing the solar or wind facility. Without a quality PPA, the project cannot move forward.
PPAs are complex, bilaterally negotiated agreements. Buyers make a profit when the market price of electricity is higher than the fixed price of the PPA, and sellers make a profit when the market price of electricity is below the fixed price of the PPA. Well-structured PPAs are designed to generate positive cash flows for the buyer.
What are "Virtual" PPAs?
Virtual PPAs do not require renewable energy buyers to take physical delivery of electricity that is generated by the seller. This structure relieves a burden for the buyer and provides the buyer with more flexibility to achieve sustainability and profitability goals. This solution is becoming increasingly popular, especially with corporations.
How should we think about PPAs vs. REC-only deals?
Entering into a PPA is among the most effective and genuine
offset strategies available to corporations. PPAs are risky by nature but require no upfront CAPEX investment and are designed to generate a profit for the buyer.
Alternatively, REC-only transactions are less risky but are guaranteed to be an ongoing operating expense. RECs should be considered a financial or accounting strategy to achieving sustainability targets, rather than an investment in a specific power facility.
In short, purchasing RECs rarely causes a new solar or wind power plant to be constructed, whereas PPAs have the potential to do so.
What are the alternatives for sourcing and evaluating PPAs?
Traditionally, companies looking to enter into a PPA have had limited options for sourcing and evaluating potential deals.
On the one hand, they could build an in-house team of energy procurement specialists.
On the other hand, they could hire a sustainability consultant to make a market for them and outsource the analysis of potential deals.
RenewaFi’s marketplace does that work using technology. The result is a faster, more secure, and more affordable contracting process.
What is basis risk?
Basis is the spread between the price of power at the point of power generation (e.g., the solar or wind facility) and the price of power at the delivery or settlement point. When the spread is large, it can significantly impact the economics of the transaction. This risk is increasingly borne by sellers in a PPA, but that is not always the case.
What is shape risk?
Renewables are inherently intermittent resources, generating when the sun shines and the wind blows. However, some offtake agreements known as “fixed shape” contracts include hourly guarantees, obligating the seller to deliver a fixed amount of electricity according to a pre-set schedule, regardless of whether the facility generates during those intervals. Shape risk is the spread between the amount of electricity the seller has committed to deliver and the amount of electricity the seller actually generates.
Sellers manage shape risk by generating more electricity than they are obligated to deliver, creating a financial “buffer.” The revenue generated by the buffer should cover the rare events when they are unable to deliver on their own and need to turn to the spot market to meet their contract obligations. Typically, the seller aims to over-generate 95% to 99% of the time, compensating for losses incurred from the 5% to 1% exception.
This type of contract demands a premium over “as-generated” or “unit-contingent” contracts, in which the buyer agrees to purchase electricity and RECs from the seller only when generated.
What is economic curtailment risk?
When the grid is overwhelmed with electricity supply, the market or balancing authority will send low or negative price signals to various sellers. When prices are extremely low, the seller may be incentivized to curtail its generation so that supply and demand can re-balance. However, if the seller does not react to the price signals, then the buyer in a PPA will be required to pay for electricity that is effectively worthless.
How are PPAs collateralized?
Credit-worthy buyers typically collateralize the PPA with a large, investment-grade parent guarantee. Otherwise, PPAs are collateralized with letters of credit and/or cash held in escrow. The sizing of the collateral can be significant and the concept of posting collateral may be prohibitive for some buyers. Sellers will also collateralize the PPA, typically with a letter of credit from an investment-grade financial institution.
What should I look for in a PPA counterparty?
There are many reputable solar and wind developers looking for quality buyers. RenewaFi has over 50 pre-vetted market participants representing more than 200 GW of renewable energy in development. These firms are eager to hear from you. We encourage you contact us and learn about how to best define your needs so that you can be matched with the appropriate seller and PPA.
Our team of renewables experts would be pleased to demo our solution for you
Request a DemoRenewaFi LLC (“RenewaFi”) offers a renewable energy marketplace. Users are cautioned that the RenewaFi marketplace is not a “swap execution facility” or registered as such with the Commodity Futures Trading Commission (CFTC). Unlike an exchange or a swap execution facility, the RenewaFi marketplace is not designed for RenewaFi market participants to place orders for standardized and tradable financially settled contracts, or to execute such contracts on the RenewaFi marketplace. The RenewaFi marketplace is a tool primarily used to help RenewaFi market participants source and interpret information. Further, users and other RenewaFi market participants will not be permitted to initiate auctions, nor should they submit proposals, to enter into a renewable energy transaction, unless the transaction is intended to be physically settled. Auctions for financially settled renewable energy transactions cannot and should not be conducted on the RenewaFi marketplace.
For further information about financially settled transactions in renewable energy commodities, please contact info@renewafi.com for consulting services with RenewaFi. RenewaFi is a New York-based, CFTC-registered Commodity Trading Advisor (Swap Firm), as well as a member of the National Futures Association (NFA). Information provided on this website is not to be considered advice, and the use of this website does not establish a customer relationship with RenewaFi. Commodity trading can be complex and involves substantial risk of loss. The use of RenewaFi software or services does not guarantee performance. RenewaFi does not provide legal services or advice. Renewable energy participants should hire and retain professional legal counsel prior to using RenewaFi software and evaluating or executing any commodity transactions.
