Power Purchase Agreements for UK Manufacturers: Benefits & Opportunities

Introduction

UK manufacturers face a dual challenge: volatile energy costs and increasing sustainability requirements. Energy procurement is no longer just an operational task — it’s a strategic necessity.

A Power Purchase Agreement (PPA) allows manufacturers to secure renewable electricity at predictable rates for the long term, cutting costs, reducing Scope 2 emissions, and improving energy security. In this article, we’ll explore exactly how PPAs benefit UK manufacturers and why now is the time to act.

1. Long-Term Cost Stability in a Volatile Market

Energy-intensive sectors like manufacturing are vulnerable to price swings. Ofgem data shows UK wholesale electricity prices increased by over 70% between 2021 and 2022.

With a PPA, manufacturers can:

• Fix or cap prices for 10–25 years.
• Budget more accurately, protecting margins.
• Hedge against future market price increases.

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By building a long-term energy procurement strategy and securing renewable energy contracts for business, manufacturers can shield themselves from market volatility.

2. Aligning with ESG and Net-Zero Goals

Manufacturers must comply with SECR, TCFD, and soon CSRD reporting requirements. PPAs support:

• Measurable Scope 2 emissions reductions using REGOs.
• Alignment with Science Based Targets (SBTi).
• Improved ESG scoring for tenders and investor relations.

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Our guide to Scope 2 emissions reporting outlines how PPAs can directly support achieving net-zero for manufacturers.

3. Energy Security and Operational Resilience

Unplanned outages or energy supply chain issues can disrupt production lines. By securing a renewable PPA, manufacturers can:

• Build energy independence.
• Reduce reliance on fossil fuel imports.
• Pair PPAs with on-site generation for behind-the-meter supply.

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Explore our behind-the-meter rooftop PPA solutions to see how they can provide added resilience.

4. Access to Renewable Energy Without Capital Expenditure

Funded PPA models allow manufacturers to transition to renewable power with zero CapEx:

• Panels or turbines installed and maintained by the funder.
• Manufacturer pays only for the power used.
• Savings start from day one.

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Learn more about CapEx vs PPA models to see which option best fits your financial strategy.

5. Strengthening Brand Value and Competitive Edge

Deloitte research shows 55% of UK consumers are willing to pay more for sustainable products. Manufacturers can:

• Win more B2B contracts through ESG leadership.
• Differentiate brand in a crowded market.
• Improve employee retention and recruitment.

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See how renewable energy for manufacturing can transform brand positioning.

Manufacturing Case Study – EVTEC Group

Sector: Automotive Technology & Energy Infrastructure
Annual Consumption: 33 GWh
Solution: Sleeved Corporate PPA integrating power from a new-build 7 MW solar farm in Bristol, with additional renewable supply sourced via Urban Chain’s private energy market.
Impact:

• Secured 100% renewable supply for the full contracted volume.
• Locked in long-term price stability in a volatile wholesale market.
• Enabled full Scope 2 emissions reduction for contracted electricity, supporting ESG reporting and investor requirements.
• Positioned EVTEC as a sustainability leader in the automotive infrastructure sector, with traceable energy procurement backed by REGOs.

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Stephen Todd, Energy Director at EVTEC Group:
“Working with CHGroup allowed us to secure a competitive, traceable renewable supply that meets our operational needs while supporting our long-term sustainability objectives. This PPA gives us stability and a clear ESG story to share with our stakeholders.”

Conclusion & Next Steps

For UK manufacturers, PPAs are not just about lowering costs — they’re about future-proofing operations in a volatile, carbon-conscious world.

At CHGroup, we specialise in structuring PPAs that deliver maximum value, protect against risk, and align with your long-term energy and ESG strategies.

Book Your PPA Consultation

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