In short: a solar PPA (power purchase agreement) is a long-term contract under which a business buys, at an agreed price, the electricity of a solar plant financed and run by an operator. On-site, the plant sits on your roof or car park; off-site, the power comes through the grid. FreXolaire, an RGE QualiPV installer, compares PPA offers in France.
This page explains how commercial solar PPAs work in France and the European Union, what they cost a business in commitment rather than cash, and when buying or leasing the system is the better deal. It is written by FreXolaire, a Paris-based solar installer certified RGE QualiPV that also designs business systems. A more detailed guide is available in French: PPA solaire en France : montage, fiscalité, durée.
What is a solar PPA?
A solar PPA is a contract to buy the electricity of a solar plant, for many years, at a price agreed in advance. The operator, sometimes called the producer or developer, designs, finances, builds and maintains the plant; the business, called the off-taker, commits to buy its output. In EU law, Directive (EU) 2018/2001 on renewable energy defines a renewables power purchase agreement as a contract under which a person agrees to purchase renewable electricity directly from an electricity producer, and Regulation (EU) 2024/1747 on electricity market design asks member states to remove barriers to such contracts.
What is the difference between an on-site and an off-site PPA?
In an on-site PPA, the plant is built on your own site and you consume its power directly. In an off-site PPA, the plant is elsewhere and the power is delivered through the public grid, so network charges apply. On-site PPAs suit buildings with a large roof or car park; off-site PPAs suit large consumers without suitable roofs or with several sites.
| On-site PPA | Off-site (corporate) PPA | |
|---|---|---|
| Where the plant is | On your roof, car park canopy or land | Elsewhere, usually a ground-mounted plant |
| How the power reaches you | Directly, consumed on site | Through the public grid, with network charges |
| Who invests and operates | The PPA operator | The PPA operator |
| Typical buyer | Sites with a large roof or car park | Large consumers, often multi-site, without suitable roofs |
| Size, as a rule of thumb | From about 250 to 500 kWp | Several GWh of consumption per year |
Size thresholds are FreXolaire’s rule of thumb for France, not legal limits: below a few hundred kWp, operators rarely find an on-site PPA worthwhile, and buying or leasing the system usually fits better.
How much does PPA electricity cost?
There is no list price: each PPA price is negotiated. The operator builds it from the cost of the plant, the expected output of your site, the contract term and your financial standing, then fixes it or indexes it for the whole term. A fixed price protects you if market prices rise, but you keep paying it if they fall, which is why the indexation clause matters as much as the starting price. For small systems, selling power to the grid no longer pays: since 5 June 2026, surplus electricity from French systems up to 100 kWp is bought at a single rate of 1.1 c€/kWh, so projects are built around self-consumption.
How long does a PPA last, and what happens at the end?
A solar PPA usually runs for 10 to 25 years. At the end of the term there are three options: renew the contract, buy the system at its residual value, or have the operator remove it. Before signing, check what happens if you sell or leave the building, and how much an early exit would cost.
- Price indexation: fixed or indexed, with a cap.
- Performance: the minimum annual output the operator commits to, and the penalties if it is missed.
- Force majeure: who pays after a major weather event.
- Assignment: transfer of the contract if the building is sold.
- Early termination: the exit fee, which should be capped.
- Buy-out option: the right to buy the system at set dates and a pre-agreed value.
PPA, leasing or buying the system: which fits?
Buying the system gives you all the savings and the asset; leasing spreads the cost while you become the owner at the end; a PPA asks for no investment but you never own the plant unless you buy it out. If your business can invest, a self-consumption system it owns usually yields the most over its life; a PPA makes sense when cash is better used elsewhere or the project is large.
| Buying the system | Leasing | PPA | |
|---|---|---|---|
| Upfront investment | Yes | None | None |
| Who owns the system | You, from day one | You, at the end of the lease | The operator, unless you buy it out |
| Maintenance | You | Often included | The operator |
| Early exit | Free | Penalised | Heavily penalised |
| What you pay | The system | Monthly rent | Each kWh produced, at the agreed price |
FreXolaire designs and installs business systems that you own: see our French page installation photovoltaïque pour les entreprises.
Which French rules push businesses toward solar?
The APER law of 10 March 2023 requires solar or green roofs on new, extended or heavily renovated non-residential buildings over 500 m² of footprint (1,000 m² for offices), on at least 40% of the roof since 1 July 2026 and 50% from July 2027. Outdoor car parks over 1,500 m² must cover at least half their area with solar canopies, by 1 July 2026 above 10,000 m² and by 1 July 2028 below. An on-site PPA is one way to comply without investing.
How is a PPA treated for VAT and accounting?
Under a PPA you buy electricity, a service: each kWh is invoiced with 20% VAT, which a VAT-registered business can normally recover. You do not own the system during the contract. Under IFRS 16, some on-site PPAs can be accounted for as a lease, because a physical asset sits on your site; check this with your auditor.
What does FreXolaire do for a PPA project?
FreXolaire is not a PPA operator. We study your consumption and your roofs, check whether a PPA is viable, put several operators in competition and help you structure the contract with your lawyer; our technical team then follows the works. If buying the system pays better, we design and install it ourselves in France, as an RGE QualiPV-certified installer with ten-year liability insurance on our installations. Outside France we do not install, but we supply panels, inverters and batteries through EU-wide delivery of solar equipment on quote.
To discuss a project, use our quote form (in French) or call +33 7 69 49 67 57; we answer in French and English. Costs for homes are on our page solar installation cost in France, and our French pages cover our installation services, our prices and solar batteries.
Methodology and sources
- Definition: Directive (EU) 2018/2001 on the promotion of energy from renewable sources, Article 2; Regulation (EU) 2024/1747 on electricity market design.
- Surplus purchase rate of 1.1 c€/kWh for systems up to 100 kWp, for requests filed since 5 June 2026: French order of 1 June 2026, summarised by photovoltaique.info.
- APER law of 10 March 2023 thresholds, VAT treatment, PPA terms and size rules of thumb: FreXolaire’s French guides on business solar and PPAs, checked on 8 October 2026.
- This page explains how PPAs work; it is not legal, tax or accounting advice.
Frequently asked questions about solar PPAs
What is a solar PPA?
A solar power purchase agreement is a long-term contract under which a business buys, at an agreed price, the electricity produced by a solar plant that an operator finances, builds and runs. EU law defines a renewables PPA as a contract to purchase renewable electricity directly from a producer.
How long does a solar PPA last in France?
Usually 10 to 25 years. The term, the price and its indexation are negotiated. At the end, the contract can be renewed, the system bought at its residual value, or removed by the operator.
Is a solar PPA cheaper than grid electricity?
It can be, but there is no standard price: the operator prices each kWh from the cost of the plant, your site and your credit standing, and the price is fixed or indexed for the whole term. Compare it over the full term with what you pay today and with buying the system yourself.
How is VAT applied to a PPA in France?
You buy a service, the electricity, so each kWh is invoiced with 20% VAT, which a VAT-registered business can normally recover. You do not own the system during the contract.
Does FreXolaire operate PPAs?
No. FreXolaire is not a PPA operator: we study your site, compare offers from several operators and help you structure the contract. We also design and install business solar systems you own, in France, as an RGE QualiPV-certified installer.
Can a PPA cover sites outside France?
An off-site PPA can supply several sites, but the rules depend on each country. FreXolaire studies and installs in France only; in the rest of the EU we supply solar equipment on quote.
Written by Charbel Ephrem for FreXolaire, an RGE QualiPV-certified solar installer and online shop for photovoltaic equipment based in Paris. Updated on 8 October 2026.