7X Energy, a utility-scale solar developer based in Austin, Texas, announced the availability on April 27 of a new product, SolarBlocks, designed for corporate energy buyers in markets with retail choice.
Traditionally, blocks in a block-and-index purchasing product are supplied by a variety of generation sources on an energy buyer’s local grid. Customers purchase a portion, or a “block,” of their energy at a fixed price; the rest is acquired at spot market pricing.
The SolarBlocks program instead offers blocks of energy that are generated by a greenfield solar plant developed by 7X Energy. A portion of a buyer’s energy needs—represented by blocks, or in this case a specified amount of energy generated by solar—is locked-in at a low, fixed rate over a contract term as short as eight years. Any additional or off-peak usage is procured from a customer’s retail energy provider through the wholesale market either at indexed real-time prices or through additional short-term block purchases.
SolarBlocks is designed for commercial and industrial (C&I) energy buyers in Independent System Operator (ISO) markets with retail choice that want to procure some of their energy from renewable sources, but seek more flexibility than a traditional 20-year, fixed-price power purchase agreement (PPA) allows.
“This strategy works exceptionally well for corporate buyers,” claimed 7X Energy CEO Clay Butler. “Companies typically consume the most energy during the day, when solar is the least expensive energy available. At off-peak times, when solar is unavailable, wholesale pricing can be competitive. It’s the best of both worlds.”
SolarBlocks allows companies to continue working with their current energy retailer while enjoying the benefits of buying solar energy.
“Companies told us that they want to simplify how they procure renewable energy,” said Butler. “Many companies are accustomed to purchasing power through an energy retailer and SolarBlocks supports that model. The retailers can work with corporations to determine the right amounts of energy to procure through blocks and the wholesale market to reduce their energy spend and mitigate risks from fuel pricing volatility. Customers will continue their billing arrangements with their preferred retailer.”
In addition, because the solar facilities that 7X Energy will build for SolarBlocks customers represent new construction, companies can claim Renewable Energy Certificates (RECs).
“SolarBlocks offers companies a new option for procuring energy that helps them meet their sustainability goals, reduce costs, and mitigate risks,” said Butler.