The Handbook

Electricity drives the engine of opportunity in the modern world. It allows our children to study by light. It powers the innovation in our factories. From telecommunications to transportation, power is essential to virtually every aspect of our increasingly dynamic and interconnected world. As a result, investment in power infrastructure is a key element of economic development. In order to promote this investment, governments, utilities and private companies have developed a contract that cements the predictability and durability that is needed for any long-term power projects. This agreement is called the Power Purchase Agreement (PPA) and it has helped to drive the development of independent power projects around the world.

In early November 2014, CLDP (in partnership with the African Legal Support Facility) brought together a group of international experts to draft and publish a PPA handbook. The handbook is intended to provide an overview of PPAs and the obligations, risks and remedies that are found within them.  The handbook was produced using the Book Sprint (http://www.booksprints.net/) method, which allows for the drafting, editing and publishing of a complete product by experts in just five days. The group of experts, all whom contributed their time on a pro-bono basis, included contributors from governments, development banks, private banks and leading international law firms. The hope is that by providing perspectives from all sides of the PPA negotiation process, the handbook can present the reader with a balanced understanding of the challenges involved in PPAs and an insight into the practical reality of overcoming these challenges when negotiating these complex agreements.

Version 1.0 of the handbook was published on the final day of the Book Sprint and was immediately hailed by the power community. Version 1.3, which includes improvements to readability and additional logos, is now available on this site both in EPUB and PDF format. A French version of the handbook is also available on this site in PDF format. The handbook is published under the Creative Commons License. Please contact Mohamed Badissy with any questions regarding the handbook. Photos from the drafting workshop can be found here.

The following is a list of authors who contributed to the handbook (in alphabetical order):

Mohamed Badissy, Attorney Advisor (International), Office of the General Counsel, Department of Commerce (United States)

Mahib Cisse​, Chief Investment Officer, African Development Bank (Cote D'Ivoire)

Patrick M. Dougherty, Senior Counsel,The World Bank (United States)

Alex Evans, Assistant General Counsel, Overseas Private Investment Corporation (United States)

Nnaemeka Ewelukwa, General Counsel and Company Secretary, Nigerian Bulk Electricity Trading PLC (Nigeria)

Jay Govender, Director – Projects and Infrastructure, Cliffe Dekker Hofmeyr Inc. (South Africa)

Ryan T. Ketchum, Partner, Hunton & Williams LLP (United Kingdom)

Allen B. Leuta, (​formerly) Head - Legal: Africa, Standard Bank (South Africa)

Anastas P. Mbawala, Director of Electricity, Energy and Water Utilities Regulatory Authority (Tanzania)

Eluma Obibuaku, Vice President - Power, African Finance Corporation (Nigeria)

Toyin Ojo, Senior Legal Counsel, African Legal Support Facility (Cote D'Ivoire)

Tim Scales, Partner, Allen & Overy LLP (United Kingdom/France)

Amir Shaikh, Chief Legal Officer, African Legal Support Facility (Côte D'Ivoire)

Michael Tam, Partner, Berwin Leighton Paisner LLP (Hong Kong)

Background

President Obama’s Power Africa Initiative aims to increase access to electrical power throughout Africa by bringing together resources from both the private sector and public sector. As part of the initiative, CLDP is working at the direction of USAID to improve the legal and regulatory environment for power projects in Power Africa countries.  CLDP’s technical assistance is focused on streamlining the project development process by identifying PPA best practices and improving understanding of the core provisions in PPAs and related documents. CLDP is working with a variety of Power Africa stakeholders including the World Bank, the African Development Bank, the African Legal Support Facility (ALSF), the Overseas Private Investment Corporation (OPIC), the Initiative for Global Development (IGD) and law firms from around the world.

In order to begin the process of identifying PPA best practices, CLDP conducted a series of expert consultations in the U.S. and Africa. In March 2014, CLDP hosted a consultative workshop that brought together leading power project and energy experts from firms in Africa, Europe and the US. CLDP then organized regional consultations in West Africa (Abuja, June) and East Africa (Dar es Salaam, July) in order to gather the perspectives of government officials and other local stakeholders such as banks and domestic law firms. CLDP also organized a forum alongside the US-African Leaders Summit in August to gather insights from developers, banks and other private companies focused on power projects in Africa. The insights gathered from these consultations formed the foundation upon which the “Understanding Power Purchase Agreements” handbook was developed. CLDP would like to thank the experts listed below (in alphabetical order) for contributing their wisdom and for building the momentum behind this program: