Zurich-headquartered Pexapark, a company specializing in enterprise software and advisory services within the renewable energy sector, proudly revealed its successful securing of €20 million in a Series C funding round. This funding round was spearheaded by Telstra Ventures, a prominent global technology investor.
Swisscom Ventures and the A&G Energy Transition Tech Fund have joined the late-stage financing initiative of this startup. Pexapark, a player in the green energy market since 2017, anticipates that the newly acquired funding will facilitate the expansion of its workforce and enable the development of innovative solutions to meet global demands.
Michael Waldner, CEO of Pexapark, expressed his enthusiasm about this fresh infusion of capital, stating, “This injection of capital propels us into the next exciting phase of our mission to empower renewable energy stakeholders worldwide with the expertise, processes, and systems necessary to thrive amidst the ever-evolving market dynamics.”
Pexapark’s product portfolio encompasses a wide range of offerings, from reliable reference prices for power purchase agreements (PPAs) to its flagship management software, PexaOS. To date, more than 200 European green energy companies, including prominent names like Octopus Energy Generation and EDF Renewables, have embraced Pexapark’s services.
Power Purchase Agreements (PPA): A Vital Component of the Green Energy Market
A Power Purchase Agreement (PPA) is a contractual arrangement between an electricity provider and a customer, typically spanning a duration of five to 20 years. Within this timeframe, customers procure electricity at pre-negotiated price levels.
According to Albert Bielinko, a partner at Telstra Ventures, PPAs play a crucial role in securing essential funding for emerging green energy initiatives. Bielinko states, “As the global transition to renewables advances and government subsidies phase out, we believe Pexapark’s services will become indispensable. Pexapark also boasts an experienced team that pioneered the first PPAs in Europe many years ago.”
PPAs are equally instrumental in aiding investors operating in the dynamic green energy sector, helping them navigate the intricacies of the market, including the ever-evolving regulatory landscape. Juan Diego Bernal, managing director at A&G Energy Transition Tech Fund, emphasizes, “In essence, Pexapark assists renewable energy investors and off-takers in making more informed decisions and automating portfolio management. We take great pride in having Pexapark as part of our company portfolio, contributing value to its global expansion.”
Anticipated Substantial Growth in the European PPA Market
In March, Pexapark’s COO, Luca Pedretti, projected that the European market could witness the emergence of up to 200 new Power Purchase Agreements (PPAs) within the current year. This growth is being driven by a shift toward shorter-term PPA agreements and the rising popularity of hybrid PPAs that involve co-located assets. Additionally, there has been a notable increase in collaborations between energy traders and corporations in this sector.
However, despite the market’s potential, several challenges could impede the formation of new deals. These challenges include the escalating costs associated with balancing the grid and concerns related to credit risk. Pexapark highlights the significance of robust data, such as that provided by its platform, in facilitating the successful execution of new green energy agreements.
Michael Waldner, Pexapark’s CEO, emphasizes the importance of these capabilities, stating, “These capabilities are crucial not only for competitively pricing energy but also for safeguarding capital by effectively managing exposure to market risks.”
The International Energy Agency has reported an eight percent increase in renewable energy supplies over the past year. Jennifer Webb, Investment Director at Swisscom Ventures, notes that investments in the green energy sector have started to outpace those in the fossil fuel industry.
Experts have been calling for stronger efforts to accelerate the transition to green energy. In this regard, the European Union (EU) has initiated various initiatives aimed at expediting the shift in the energy sector. The EU has set an ambitious goal of increasing the share of renewable energy sources to at least 42.5 percent by 2030.