Virtual PPA Settlement Exposure Calculator

Stress-test a virtual power purchase agreement against current prices. Provide the strike price, hub market price, and settled MWh, then add an optional basis adjustment or hedge share to surface the settlement payment, rate per MWh, and blended energy price you actually absorb.

Fixed VPPA strike price agreed with the project.
Day-ahead or real-time price at the settlement hub.
Total generation hedged for the interval.
Optional. Node-to-hub basis adder (negative if the node clears below the hub).
Optional. Percentage of production covered by the VPPA.

Finance decisions should incorporate full VPPA contract language, collateral terms, and credit requirements. Use this tool for directional modeling only.

Examples

  • $58 strike, $42 hub price, −$4 basis, 62,000 MWh hedged at 75% ⇒ Effective realized price $38.00 per MWh • Settlement cash receivable: $930,000.00 • Settlement rate on hedged volume: $20.00 per MWh • Average blended price across all volume: $53.00 per MWh • Volume hedged: 46,500.00 MWh • Unhedged: 15,500.00 MWh
  • $45 strike, $52 hub price, +$2 basis, 41,000 MWh, hedge share left at 100% ⇒ Effective realized price $54.00 per MWh • Settlement cash payable: $369,000.00 • Settlement rate on hedged volume: −$9.00 per MWh • Average blended price across all volume: $45.00 per MWh • Volume hedged: 41,000.00 MWh • Unhedged: 0.00 MWh

FAQ

How do I include renewable energy credits?

Add REC revenue or costs separately. This calculator isolates the power leg of the VPPA so you can bolt on green attribute assumptions in a second step.

Can I model a price floor?

Yes. Replace the strike price with your floor price to see cash flow under floor-style contracts where upside remains open.

What if settlement volume differs from metered generation?

Update the Settled volume input to the contract volume for that month; unhedged megawatt-hours remain visible in the Unhedged line.

Does this support negative prices?

Enter negative hub prices or basis adjustments—they will flow through the same formula and highlight when settlements flip sign.

Additional Information

  • Basis adjustments capture node-to-hub differences that often dominate VPPA volatility.
  • A hedge share below 100% reflects curtailment, shape mismatch, or contract limits that leave some generation exposed to market prices.
  • Settlement cash flows settle monthly and should be netted with REC revenues and retail supply costs for a full risk view.

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