# Power Purchase Agreements: Driving Solar Growth and Financing Solar Panels for Your Home
When you think about the rapid rise of clean energy in the U.S., there’s a good chance solar panels for your home immediately come to mind. However, large-scale solar projects also play a key role in reducing our carbon footprint and meeting growing electricity demands. A new report by the American Council on Renewable Energy (ACORE) highlights the critical role corporate power purchase agreements (PPAs) play in getting these ambitious solar projects off the ground.
Here’s why this approach is so important to the solar industry and how it enables solar companies to drive forward the development of both residential and utility-scale renewable energy installations.
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### What Are Power Purchase Agreements?
In simple terms, a power purchase agreement (PPA) is a long-term contract where a buyer, such as a corporation, agrees to purchase electricity directly from a renewable energy project. These agreements can be physical (involving direct delivery of power) or virtual (money changes hands to support clean energy generation without power being delivered physically).
For solar companies and project developers, PPAs serve as a critical financial lifeline. Solar developers typically face significant upfront construction costs to build a solar array for home or utility-scale use
Original Article: https://pv-magazine-usa.com/2025/01/08/despite-wind-and-solars-low-costs-ppas-remain-vital/
