Solar PPA prices jump 5% in Q3, mainly on new tariffs: LevelTen

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Dive Brief:

• The price of the average solar power purchase agreement rose 4.9% to $64.23/MWh during the third quarter of 2026, according to LevelTen Energy. Solar PPA prices are up 6% year-over-year and 12.7% since the third quarter of 2024.
• Wind PPAs, on the other hand, remained relatively flat in the third quarter but have increased 13.8% year-over-year and 27.5% since 2024, according to LevelTen Energy.
• Tariffs have driven the majority of the recent increase, and could push prices higher in the months to come, said Sarah Wolf, director of North America transactions for LevelTen Energy.

Dive Insight:

Demand from hyperscalers is reshaping the power purchase agreement landscape — but the Section 232 tariffs announced in early August could add $3/MWh to $7/MWh by the time they take effect later this year, Wolf said.

Much of the third quarter's price increase is anticipatory — buyers are trying to secure new contracts before the tariffs take effect, she said. But current rules prohibit developers from stockpiling solar modules, and the tariffs are already affecting equipment pricing.

“We're already seeing more than half of solar modules repriced, and we know that price is being passed down to sellers and ultimately buyers,” Wolf said.

Wind developers remain constrained by permitting challenges at the federal level. Although overall prices remained flat, wind PPA prices continued to rise for most of the U.S., according to LevelTen. A modest decline in prices within the Electric Reliability Council of Texas territory pulled the North American average downward, the clean energy marketplace company said.

Compared to other regions, ERCOT has seen a larger number of wind projects come online in the past few months, even as demand for wind power has cooled somewhat because buyers view solar as a safer bet in the current political landscape, Wolf said. But overall, contracts on new-build wind projects remain scarce, she added. “We have much less wind than we have ever seen getting onto the platform because of the challenges with permitting,” she said.

But a new opportunity has emerged for buyers in recent months, Wolf said: as the nation's renewable energy fleet has begun to age, some contracts on existing wind and solar projects have expired, giving new bidders an opening. In other cases, developers are repowering or expanding existing sites in lieu of — or addition to — developing new projects, she added. 

Hyperscalers remain primarily interested in new-build wind and solar, and have come to dominate that segment of the PPA market. Wolf said 99% of new-build PPAs signed in the first quarter of this year went to hyperscalers, and the number of first-time PPA buyers has fallen to its lowest level since 2016, according to CEBA.

Other buyers have turned to PPAs tied to existing power projects in search of greater availability. Realistically, Wolf said, prices for new-build PPAs and for PPAs tied to existing projects remain comparable. And prices for all PPAs seem likely to continue rising for the foreseeable future, given the uncertain geopolitical climate and the impending expiration of renewable energy tax credits.

“It's still a matter of racing against the clock to lock in projects” that still qualify for tax credits, she said.