What is a PPA contract?

A PPA (Power Purchase Agreement) is a 15-25 year agreement between the solar installer (power producer) and the building owner (power buyer). It covers per-kWh pricing, annual escalator, post-contract system ownership, performance warranty, and provisions if the customer sells the building mid-contract. See our Solar PPA service guide.

What is the PPA fee? Who pays whom?

"PPA money" is the monthly electricity fee the customer (e.g., a factory) pays to the solar installer based on kWh actually produced by the system. It is not equipment financing and not a roof rental. Example: 10,000 kWh/month × 2.80 THB/kWh = 28,000 THB. If the system produces nothing in a given month, the customer owes nothing.

What is a PPA assessment and how many steps does it take?

A PPA assessment is the process a provider uses to decide whether your business fits PPA. Steps: (1) collect the last 12 months of PEA/MEA bills, (2) rooftop survey + solar irradiance measurement, (3) preliminary system sizing, (4) proposal with PPA rate and 20-year savings projection. Total time: 1-2 weeks. Run a rough self-estimate with the PPA Comparator first.

In an energy context, PPA is not a disease — it stands for Power Purchase Agreement. In a medical context, PPA refers to Progressive Primary Aphasia, a neurological condition that requires specialist care. This article only covers PPA in the solar energy sense.

Is solar PPA legal in Thailand? What permits are required?

Yes — solar PPA is legal in Thailand and regulated by the Energy Regulatory Commission (ERC). The provider holds the energy business license and files the grid-interconnection request with PEA or MEA. The customer (electricity user) does not need a permit. Systems ≤ 1 MW qualify for exemptions that make the process faster. For full details, see Thailand Solar Law 2026 complete guide.

What is CapSolar's PPA rate per kWh?

CapSolar's PPA rate typically falls in the range 2.50-3.20 THB/kWh, depending on system size, load profile, and contract length — usually 25-40% below PEA/MEA TOU tariffs. The exact price requires a site survey. Run a rough estimate with our free tool first.

PPA vs EPC — what is the difference and which is better?

PPA: zero investment, instant 10-30% savings, 15-25 year contract, provider owns the system. EPC: customer invests (roughly 25-40M THB per MW), payback 4-7 years, up to 100% savings after payback, full ownership from day one. Pick PPA if you want zero capex + fast ESG; pick EPC if you have capex budget and want maximum long-term ROI. Compare PPA vs EPC. If you go the PPA route, review our comparison of Thai PPA providers before signing.

Can PPA work for factories in leased premises?

Yes — provided the lease has ≥ 15 years remaining and the landlord signs a written consent. The preferred structure is a tri-party agreement signed by the landlord, the tenant, and CapSolar, with a clause that the PPA can transfer to a new tenant or the landlord if the current tenant moves out.

What is PPA the abbreviation of?

PPA stands for Power Purchase Agreement. In the Thai clean-energy context, a PPA is a contract under which a third party (e.g., CapSolar) installs rooftop solar at no cost to the customer, who then buys the kWh actually produced at a locked rate for 15-25 years.

How is solar PPA different from a regular electricity bill?

A regular electricity bill is paid to PEA/MEA at TOU+Ft rates that ERC revises every 4 months (3.88-3.95 THB/kWh in 2026), with no contract end. A solar PPA is paid to the installer (e.g., CapSolar) at a locked 2.20-2.80 THB/kWh for 15-25 years (with a ~2%/yr escalator). The customer gains predictable pricing, immediate carbon reduction, and zero capex.

What does PPA stand for, and what kind of contract is it?

PPA stands for Power Purchase Agreement — a 15-25 year contract between a solar investor (e.g., CapSolar) and the electricity user (e.g., a factory or commercial building). The investor pays for all installation, maintenance, and equipment replacement; the customer pays only for the electricity produced, at roughly 10-30% below PEA/MEA grid rates.

What does Power Purchase Agreement mean in Thai solar context?

A Power Purchase Agreement (PPA) in solar context is a "solar electricity purchase contract." The investor installs the system on your roof at zero customer capex; the customer purchases the kWh produced at a locked rate for the 15-25 year contract term. It is popular among Thai factories because it cuts the electricity bill immediately without disturbing working capital.

Why is solar installation called PPA? What's the origin of the term?

"PPA" has been the standard term in the global energy industry since the 1990s. It originally described contracts between independent power producers and state utilities. Today the same term covers third-party solar PPAs, where an investor installs the system at no customer capex. This structure is formally recognized and regulated by Thailand's ERC (Energy Regulatory Commission).

Is PPA suitable for factories in Rayong / EEC?

Very suitable. Factories in Rayong and the EEC (Rayong / Chonburi / Chachoengsao) typically have large roofs and high TOU tariffs, so they benefit from PPA immediately at zero capex — the investor (e.g., CapSolar) installs and maintains everything. See the area-specific context in the Rayong / EEC factory solar guide, and compare against self-investment in PPA vs EPC.

Can a BOI-promoted project also use a PPA?

Yes. Being BOI-promoted does not conflict with running a PPA — the two structures sit on different layers. BOI tax privileges generally attach to the factory's core promoted activity, while a PPA is a contract to buy electricity from a solar system the investor installs. Check with your BOI advisor whether the asset owner (the PPA provider) affects your specific privileges. See the full incentive breakdown in the 2026 BOI solar incentives guide.

Solar Knowledge

What is PPA? Explained in 5 Minutes

Name: CapSolar
Address: 429/44 Sukhonthasawat Rd, Lat Phrao, Bangkok, 10230, TH
Telephone: +66 2 124 5414
Price range: $$$$

Power Purchase Agreement — the contract that lets businesses use solar energy without investing a single baht

5 min read

This article covers PPA in the solar energy context (Power Purchase Agreement). If you are looking for the medical PPA (Progressive Primary Aphasia), please consult a medical specialist or trusted medical sources.

What is PPA? It Stands for Power Purchase Agreement

PPA stands for Power Purchase Agreement — a 15–25 year contract under which a solar provider installs and maintains a rooftop solar system on your factory at zero installation cost, and you pay only for the electricity it produces at a rate roughly 10–30% below PEA/MEA grid tariffs.

PPA at a glance
Item	Detail
Full name	Power Purchase Agreement
Contract term	15–25 years
Customer installation cost	0 THB (investor covers everything)
Rate vs PEA/MEA	Roughly 10–30% cheaper
Regulator	Energy Regulatory Commission (ERC)

What is PPA? A Short Definition

A Power Purchase Agreement (PPA) is a 15-25 year contract under which a solar provider such as CapSolar installs and maintains a rooftop solar system on a customer's facility at zero cost. The customer pays only for the electricity produced — typically 10-30% below PEA/MEA grid tariffs.

What is PPA? — A Simple Explanation

PPA stands for Power Purchase Agreement, or simply a "power buying contract." In plain terms, someone installs a solar panel system on your factory or building rooftop — and you don't pay for the installation. You simply buy the electricity it produces at a rate cheaper than your normal electricity bill.

Think of it this way — PPA is like "renting" a solar system. Compare it to housing: if you buy a house (EPC), you pay a large sum upfront but own it. If you rent (PPA), you pay a monthly fee that's cheaper than mortgage payments, and move in right away. For an industrial factory, a factory power purchase agreement (PPA) means rooftop solar at zero investment — see CapSolar's factory solar PPA installation service. If you prefer to invest yourself via EPC, read the full factory solar EPC guide to understand the 6-step solar EPC service. Because a PPA is a 15-25 year contract, review the PPA contract clauses to check before signing carefully first.

Simple Analogy

Buy a house = EPC (self-invest)

Rent a house = PPA (no investment)

For businesses that want to save on electricity but don't want to invest a large sum, PPA is the smartest choice. You start saving from day one when the system goes live, with zero financial risk. See CapSolar's Solar PPA service.

Key PPA Numbers in Thailand

Discount vs PEA/MEA tariff: 10-30%
Typical contract term: 15-25 years
CapSolar PPA rate range: 2.50-3.20 THB/kWh

Estimate your own savings

How Does PPA Work?

01Site Assessment
Engineers survey your roof and analyze your electricity usage to design the most suitable system
02System Installation
The PPA provider invests in and installs the entire solar system. You don't pay a single baht.
03Power Generation
Solar panels start generating electricity from sunlight, feeding power directly into your building's electrical system
04You Use Power
You use solar electricity normally, just like grid power from PEA/MEA, but at a 10-30% discount
05Pay as You Use
You pay for solar electricity based on actual usage, at the discounted rate agreed in the contract. Simple and transparent.

Read the full Solar PPA service details

Who is PPA For?

Suitable For

Factories with large roof areas (1,000+ sqm)
Businesses that don't want to invest large capital
Companies wanting immediate electricity savings (BOI-promoted projects can pair with PPA too — see the 2026 BOI solar guide)
Organizations wanting to reduce carbon footprint for ESG & CBAM compliance

May Not Be Suitable

Leased premises with less than 10 years remaining on lease
Very small roofs (less than 500 sqm)
Buildings with insufficient roof structural strength

Try the free PPA Comparator tool

PPA vs EPC — Comparing Two Models

Comparison	PPA	EPC
Investment	0 THB — No investment needed	3-30M THB depending on size
Electricity Savings	10-30% immediately	50-70% after payback
Ownership	Provider owns the system	You own the system 100%
Contract Period	15-25 years	No binding contract
Maintenance	Provider handles everything	Your responsibility
Contract / Warranty	15-25 years, performance warranty throughout	Panels 25 years / inverter 10-12 years
Financial risk	CapSolar carries performance + technology risk	Customer bears the risk
Best fit for	Businesses that want to cut opex without capex + fast ESG progress	Businesses with capex budget + seeking maximum long-term ROI

Start a free PPA assessment · How do EPC and PPA differ — full 12-dimension comparison

Written and Reviewed by the CapSolar Team

This article is authored by CapSolar's in-house engineering and advisory team — the same team that develops and operates EPC + PPA projects across Thailand totalling 80+ MWp across 150+ sites. Combined, our team has 15+ years of on-the-ground experience covering system design, PPA contract negotiation, ERC / PEA / MEA compliance, and long-term O&M.

CapSolar PPA — The Best Choice for Your Business

0 THB Investment

We invest everything — from equipment and installation to maintenance

Save 10-30%

Start saving on electricity from day one — no payback period to wait for

25-Year Guarantee

Long-term contract with comprehensive warranty — peace of mind throughout

See our Solar PPA Service Get a Free PPA Quote Compare PPA with cash, bank loan and lease Direct PPA — Buy clean power via the grid The complete factory solar guide

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This page is one of 15 topics in the Factory Solar Thailand 2026 master hub — Assess → Design → Finance → Operate.

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What is PPA? Explained in 5 Minutes

What is PPA? It Stands for Power Purchase Agreement

What is PPA? A Short Definition

What is PPA? — A Simple Explanation

Key PPA Numbers in Thailand

How Does PPA Work?

01Site Assessment

02System Installation

03Power Generation

04You Use Power

05Pay as You Use

Who is PPA For?

Suitable For

May Not Be Suitable

PPA vs EPC — Comparing Two Models

Top Google Questions (People Also Ask)

Written and Reviewed by the CapSolar Team

CapSolar PPA — The Best Choice for Your Business

0 THB Investment

Save 10-30%

25-Year Guarantee

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Interested in PPA for Your Business?