Long Term Service Agreement (LTSA)

A Long Term Service Agreement is a multi year contract between an asset owner and an original equipment manufacturer or specialist service provider that covers maintenance, monitoring, and performance guarantees for turbines, inverters, or balance of plant systems. LTSAs provide price certainty for major overhauls and ensure that specialized technicians remain on call throughout the asset life cycle. They are standard for gas turbines, wind fleets, battery systems, and HVDC converters.

The agreements specify inspection intervals, spare parts inventories, response times, and availability guarantees. Many incorporate digital twins and remote diagnostics so that service providers can detect anomalies before they cause forced outages. Escalation formulas, indexation, and shared savings clauses align incentives when efficiency or reliability improvements are achieved.

Developers negotiate LTSAs alongside EPC contracts and financing packages, because lenders require proof that critical equipment will remain within warranty and that replacement parts are secured. In competitive tenders, bidders often differentiate themselves with superior LTSA coverage that reduces long term operating risks for utilities or corporate buyers.

Second life buyers and infrastructure funds scrutinize LTSA assignments, termination rights, and pricing resets when acquiring assets. Transparent access to LTSA terms helps investors model residual value, plan repowering, and understand how future upgrades will be integrated without voiding warranties.