ERG (renewable energy producer) and Norwegian energy company Statkraft have signed a Power Purchase Agreement for the supply of more than 800 gigawatt-hours of wind-generated electricity from operational sites in southern Italy, the two companies announced on July 20, 2026.

Terms of the Agreement

The deal, signed between ERG's subsidiary ERG Power Generation S.p.A. and Statkraft, is structured as a financial PPA with a "pay as produced" profile and will run for seven years beginning January 1, 2027.

Under the terms of the contract, ERG will supply approximately 118 GWh per year of electricity along with an equivalent volume of Guarantees of Origin. The energy will be generated by ERG's wind farms in southern Italy, all of which are already built and in operation.

The agreement is financial in nature, meaning it is structured around price settlement rather than the physical delivery of electricity, a format commonly used in the European renewables sector to provide revenue certainty without requiring direct grid transfer arrangements between the contracting parties.

Strategic Significance for ERG

For ERG, the deal represents a further step in what the company describes as a strategy of revenue stabilisation through long-term contracting. Paolo Merli, Chief Executive Officer of ERG, said the agreement allows the group to give additional visibility to its revenue stabilisation path. He noted that with this latest PPA, the group has now surpassed 3.8 terawatt-hours per year of energy placed under contract over the past five years.

ERG describes itself as Italy's leading onshore wind operator and ranks among the top ten onshore wind producers in Europe. The group is active in eight European countries as well as the United States, and in addition to wind, operates in solar energy generation, where it is also among the top ten operators in Italy, and in the battery storage sector.

The company completed a transformation over the course of roughly a decade from an oil-focused operator to a pure wind and solar business model.

The 800-plus GWh figure referenced in the deal title represents the total volume to be delivered across the full seven-year duration of the contract at the stated annual rate of approximately 118 GWh.

Statkraft Expands Its Italian Portfolio

For Statkraft, the PPA adds a further renewable energy stream to its existing Italian operations. Bernardo Ricci Armani, Country Manager Italy at Statkraft, said the long-term agreement reinforces the company's portfolio in the Italian market and reflects its commitment to supporting renewable energy growth through tailored market solutions for corporate clients.

He added that the integration of high-quality wind energy into Statkraft's portfolio broadens its capacity to offer flexible and personalised energy procurement solutions, supporting clients in meeting their energy supply and sustainability objectives while contributing to Italy's energy transition.

Statkraft entered the Italian market in 2020 and is part of a broader European operation encompassing approximately 6,200 employees across 20 countries. The company, which has 130 years of history, develops and manages hydroelectric, wind, and solar energy assets as well as storage systems and offers PPA solutions for buying and selling energy. It identifies itself as Europe's largest producer of renewable energy.

Guarantees of Origin Included

A notable feature of the agreement is the inclusion of Guarantees of Origin alongside the energy volumes. Guarantees of Origin are certificates issued under European Union frameworks that allow energy buyers to verify the renewable source of the electricity they procure.

Their inclusion in the deal reflects growing corporate demand for traceable renewable energy credentials, particularly among businesses with sustainability commitments requiring documented proof of clean energy sourcing.

The wind farms covered by the contract are located in southern Italy, a region that has historically been one of the most productive areas for onshore wind generation in the country due to its favourable meteorological conditions.

The fact that all relevant assets are described as already built and operational means there is no construction or commissioning risk attached to the supply volumes underpinning the agreement.

Market Context

The deal forms part of a broader trend in European energy markets in which renewable energy producers and large energy traders or retailers use long-term PPAs to provide price certainty on both sides of the transaction.

For producers such as ERG, these contracts reduce exposure to wholesale market price volatility. For buyers and traders such as Statkraft, they secure access to defined volumes of renewable generation that can be structured into products for corporate energy customers.

ERG's disclosure that the group has now contracted more than 3.8 TWh per year across the past five years of deal-making indicates the scale at which the company has pursued this approach to revenue management as part of its broader transition from fossil fuel operations to a renewables-only business model.

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