Project Background​

In July 2023, the IASB decided to add a project to its work plan to research whether feasible narrow-scope amendments to IFRS 9  to better reflect the effect of Power Purchase Agreements (PPAs) on the financial statements.

In December 2023, based on the outcome of the IASB Staff research, the IASB tentatively decided to:

  • to undertake narrow-scope standard-setting to amend IFRS 9 Financial Instruments, with the next project milestone to be an exposure draft; and
  • to explore an approach to this standard-setting that includes amending the ‘own use’ and hedge accounting requirements in IFRS 9 for both physical PPAs and virtual PPAs.

Exposure Draft

On 8 May 2024 the International Accounting Standards Board (IASB) published for public comment the Exposure Draft Contracts for Renewable Electricity (Here), which proposes narrow-scope amendments to IFRS 9 and IFRS 7.

The Exposure Draft is open for comments until 7 August 2024.

Draft Comment Letter

On 13 June 2024 EFRAG issued its draft comment letter ('DCL'),  welcoming IASB's efforts and approach addressing both own-use exception requirements as well as hedge accounting requirements. 

Several specific questions on the topics covered in the ED are addressed to the constituents. The consultation on EFRAG's DCL was open until 15 July 2024 and the comment letters received can be viewed within the Documents section of the project page here.