What is solar contract management?
The SPVs or project companies that own the operational solar assets will have entered into multiple contracts. The most important agreements are the PPA (power purchase agreement), lease agreements, loan agreements, O&M agreements, interconnection agreements, EPC agreements and any incentive agreements. These agreements will contain obligations for the SPVs or project companies as well as for the counter parties.
What are the key steps for successfull contract management
Step 1: Capture
- Collect all of your existing fully executed paper contracts
- Scan the documents in searchable format
- Upload them in a central visible place
Step 2: Update
- Collect all amendments to the contracts
- Put them in order and identify missing amendments
- Summarise key amendment terms
Step 3: Analyze
- Once you know where all your contracts are, the next step is to analyze important data in the contracts, such as information about your counter party, general contract terms and specific contract terms specifically tailored for the type of contract (for example positive and negative covenants for loan agreements or specific PPA terms)
Step 4: Audit
- StepIdentify compliance events: With tracking in place, you will identify your most important compliance events. These could be events like monthly reporting, making payments, sending out invoices, renewing contracts, producing debt service coverage certificates, renewing insurance policies etc;
- Set compliance dates: Your asset managers will have a self-service wizard to create important compliance dates for the lifetime of the solar project. You will be able to assign individual responsibilities;
- Operate: “Fingertip access” to contract terms and data allows your asset managers to ensure that all important compliance is met. Asset managers will receive weekly or monthly emails informing them of any compliance dates coming up and will receive email reminders if compliance dates are overdue;
- Approve: You can set up an approval workflow process to ensure that compliance events are reviewed and approved by the right person;
- Monitor: Your compliance officer will be track the overall compliance via customizable dashboards outlining overdue compliance or by email alerts.