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Bullfrog, biz leaders partner on power purchase agreements

Green energy retailer Bullfrog Power Inc. sees power purchase agreements (PPAs) as a growing piec...

IMAGE: Rattlesnake Wind Farm

The wind project at Rattlesnake Ridge in Alberta is the energy provider for Bullfrog Power’s most recent power purchase agreement. (Courtesy Berkshire Hathaway Energy)

Green energy retailer Bullfrog Power Inc. sees power purchase agreements (PPAs) as a growing piece of the net-zero puzzle, and its involvement in the sector is drawing attention from some of Canada’s largest and most influential businesses.

PPAs are long-term contracts between an energy buyer, or buyers, and a renewable energy project developer. The buyer acquires energy from the project for a predetermined rate, once the project comes online.

Bullfrog’s most recent PPAs are in partnership with Shopify Inc. and the Royal Bank of Canada (RBC), with the energy coming from Berkshire Hathaway Energy’s (BHE) soon-to-be-complete Rattlesnake Ridge wind power project near Medicine Hat, Alta.

The 130 MW project, which features 26 turbines, is expected to begin commercial operations this May.

Sarah Bertollo, Bullfrog’s head of sales, said PPAs “are a really helpful mechanism to procure a lot of green energy at once.”

Bullfrog is a Toronto-based energy retailer which sources sustainable/green electricity, natural gas and fuels to provide to businesses and homes, but in 2019 also set up its own PPA solutions system.

The aim is to help businesses determine if a PPA is the best option for their situations and then walk companies through the process. Shortly after, in 2020, Bullfrog also became interested in acquiring PPAs for its own use.

Each of the three companies (RBC, Shopify and Bullfrog) has contracted for 30,000 MWh per year from Rattlesnake Ridge, equivalent to the power used by about 3,800 homes.

The group is joining an unnamed anchor tenant, only known as “a large Canadian corporate partner,” which had already signed an agreement for a significant amount of the project’s output.

Bullfrog Power and PPAs

Bullfrog’s first PPA as a buyer was purchased in July 2020 from the Burdett and Yellow Lake solar project which was constructed by Guelph, Ont. power producer BluEarth Renewables Inc. It consists of two solar farms near Medicine Hat with a combined capacity of 39 MW.

Bullfrog and RBC each agreed to purchase 31,500 MWh annually from the Burdett and Yellow Lake site. This project, which came online in May 2021, helped RBC increase the power it obtains through renewable sources to 84 per cent of its usage, the bank said.

Equally important for Bullfrog, it provided valuable insights into how PPAs work.

“It was quite a journey to . . . learn the ins and outs. It took quite a while to come together. But once we did that, we realized that we wanted to do another one pretty quickly,” said Bertollo. “We knew we wanted to diversify the technology.”

RBC was a partner with Bullfrog in that contract, but the bank had a long history with the firm. It was one of Bullfrog’s first green energy customers when it started in 2005.

PPA to power Shopify’s work-from-home

Shopify is a more recent customer for Bullfrog, since 2020. Bertollo noted Shopify’s Sustainability Fund managers had first expressed interest in the PPA, because Bullfrog was already partnering with RBC on the Rattlesnake Ridge project.

The e-commerce giant differs from its other PPA partners in that it won’t directly use the electricity it purchases from Rattlesnake. Instead, it’s intended to offset emissions from employees’ home offices.

“Shopify has proudly become the first Canadian-founded company to sign a PPA to power 100 per cent of employee home offices across North America with wind energy,” the company said in a press release.

Once the partners were in order, Bullfrog sent out a request for proposals which drew interest from “quite a few” developers. Warren Buffet-owned BHE won the bid for a number of reasons, including the speed with which the Rattlesnake project would be up and operating.

“So many projects are in the queue to come online in Alberta; many of them are in 2023 or even 2024,” Bertollo said. “We were looking for something where we could start procuring the environmental attributes as soon as possible.

“They had the right commercial operation date. (They were) starting at the right time, the right volume, the right price.”

The partners have not disclosed the length of the agreement.

Future and potential of PPAs

Bullfrog now plans to pursue two additional PPAs, aiming to get started on that process later this year. The Rattlesnake Ridge PPA took about eight months to execute from start to finish.

“We’re definitely interested in both another solar and another wind PPA for our own business and potentially working again with other buyers,” Bertollo said.

There are several qualities which make businesses best suited to a PPA type of agreement, including their location in Canada and their ability to take on a certain amount of risk with a long-term contract.

“Large financial services, large tech, large manufacturing,” are the best fits, according to Bertollo.

“I think PPAs will definitely continue to grow in interest. It’s also a great way to be cost neutral, potentially. So if you’re in the right contract at the right price, this can all happen at a very little incremental cost to the buyer.”

Bullfrog’s green electricity is sourced from various wind, solar and hydro facilities across Canada. Its natural gas comes from a facility near Montreal and a landfill project in Zeeland, Mich. Fuel is sourced from Montreal biodiesel producer Pétroles Parkland.

Bullfrog says it has put over five million MWh of green electricity on the grid and served over 1,500 businesses since its founding in 2005.

In 2018, Bullfrog became a subsidiary of Spark Power Group Inc. (SPG-T), an independent provider of end-to-end electrical services and sustainability solutions in Oakville, Ont. Since then, it has been classified as Spark Power’s sustainability division.

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