Solmar Insights
The average price for US solar power purchase agreements (PPAs) jumped nearly 5% in the third quarter of 2026, according to LevelTen Energy, reaching $64.23 per MWh. The increase is largely attributed to new import tariffs and anticipatory contracting, setting a new high for utility-scale renewables buyers.
Key figures
Solar PPA prices up 4.9% to $64.23/MWh, Q3 2026
Solar PPA prices up 6% year-over-year
Wind PPA prices up 13.8% year-over-year
Section 232 tariffs projected to add $3 to $7/MWh
Tariffs drive solar contract escalation
LevelTen Energy has identified newly announced Section 232 import tariffs as the central driver behind the sharp rise in solar PPA prices. These tariffs, slated to take effect later in the year, are anticipated to increase project costs by an additional $3 to $7 per MWh. Developers are unable to stockpile imported modules under current federal policy, intensifying supply chain pricing pressure.
Buyers are moving to secure contracts ahead of the tariff deadlines to lock in more favorable pricing. Sarah Wolf, director of North America transactions for LevelTen Energy, noted that over half the nation’s solar modules have been repriced recently in anticipation of the tariffs, causing the higher equipment costs to be passed through the PPA market.
This period of anticipatory contract activity underscores how policy uncertainty and trade regulations directly shape energy project economics. For buyers and sellers, the policy environment is a key input to procurement timing and strategy in utility-scale renewables.
Solar and wind market performance diverges
While solar PPA prices experienced a significant quarter-on-quarter rise, wind PPA pricing remained relatively flat between July and September 2026, according to LevelTen. However, wind PPAs still posted a 13.8% increase year-over-year and have grown 27.5% since the third quarter of 2024, outpacing the two-year gains in solar over the same period.
Most of the recent wind price movements have been muted nationwide due to a notable price drop in the Electric Reliability Council of Texas (ERCOT) territory. ERCOT’s declining average was driven by a burst of new wind project completions, even as national demand for wind softened in favor of solar amid shifting political risk preferences. Across North America, securing contracts for new-build wind remains a challenge given persistent permitting and siting delays at the federal level.
Despite the relative decoupling in Q3, the LevelTen report cautioned that wind prices could soon trend upward once Section 232 tariffs begin affecting cost structures for all renewables. The challenge for both buyers and sellers remains to find attractive contract terms in a supply-constrained and policy-volatile market.
Demand from hyperscalers and buyer concentration
One of the most consequential shifts in the renewable PPA market has been the dominance of hyperscalers, large-scale data center and cloud platform operators, in new-build procurement. According to LevelTen, 99% of new-build PPAs signed in the first quarter of 2026 went to hyperscalers, significantly reducing opportunities for other commercial and industrial buyers.
This growing buyer concentration has driven up competition for PPAs on viable projects, especially in regions where new capacity is tight or constrained by interconnection delays. The number of first-time PPA buyers is at its lowest since 2016, as non-hyperscaler buyers are increasingly priced out or forced to adjust procurement timelines and expectations.
This consolidation not only accelerates price increases amid tariff uncertainty, but also shifts the structure of the corporate energy procurement market. Developers must now tailor offerings and timelines around the infrastructure and capacity needs of hyperscale customers, amplifying their bargaining power and influence over regional contracting patterns.
Contracting opportunities on aging assets
Amidst constrained supply for new-build projects, LevelTen’s analysis points to emerging opportunities in the repowering and expansion of existing wind and solar assets. As contracts on legacy projects expire, new bidders, including energy aggregators and retail providers, are able to pursue offtake from previously committed generation capacity.
This secondary market presents a window for buyers unable or unwilling to compete directly with hyperscalers for new-build PPAs. Developers, meanwhile, are increasingly investing in repowering or site expansions as a way to sidestep greenfield interconnection obstacles and protracted permitting timelines.
For institutional capital, these trends reinforce a bifurcation: hyperscalers continue to dominate new capacity procurement, while agile buyers, smaller retailers, and aggregators may find more value in legacy asset contract rollover or site-level upgrades. This dynamic creates segmentation and a new set of pricing benchmarks for both assets and PPAs over the next several quarters.
What this means for buyers
Power and equipment buyers in the US utility-scale solar sector face an average PPA price of $64.23 per MWh, a 4.9% increase in Q3 2026 driven chiefly by new trade tariffs. The upcoming Section 232 tariffs are expected to add another $3 to $7 per MWh, further tightening margins and deal timing. Buyers seeking new-build contracts may need to accelerate procurement ahead of tariff enforcement, while others could focus on legacy asset opportunities to mitigate input cost volatility.
Reporting via the original publisher
