In February 2026, Google and TotalEnergies signed a 15-year power purchase agreement for 1,000 megawatts of Texas solar — the largest single clean-power contract ever tied to a single buyer’s data center load. It will not hold that record for long. Hyperscalers now account for roughly 90% of new U.S. clean-power contract volume, up from 76% just a quarter earlier, and the prices they are paying to secure that power have moved decisively higher across every major grid region. For anyone pricing data center capacity in 2026 and 2027, the power purchase agreement (PPA) market is no longer a background detail in the energy bill — it is becoming one of the largest, least predictable line items in the deal.
The Big Four have crowded out everyone else
According to S&P Global Energy’s Horizons dataset, total North American PPA activity fell to about 36 gigawatts in 2025, down from roughly 60 gigawatts in 2024 — but that drop masks a concentration shift, not a demand slowdown. Meta, Google, Amazon, and Microsoft accounted for 76% of PPA volume in the fourth quarter of 2025, and that share climbed to 90% in the first weeks of 2026, when roughly 11 gigawatts of clean-energy PPAs were announced between January 1 and February 23 alone. Data centers consumed an estimated 270 terawatt-hours of electricity in 2025 and procured about 180 terawatt-hours of it through PPAs — and S&P Global projects U.S. data center load could reach 765 terawatt-hours by 2030.
The practical effect for a mid-sized buyer: the counterparties, developers, and interconnection queue slots that used to serve a broad mix of utilities, corporates, and municipalities are now being absorbed by four companies with balance sheets built for gigawatt-scale, decade-long commitments. If your capacity plan assumes you can walk into the same PPA market a hyperscaler is shopping in, the 2026 data says otherwise.
Clean power got more expensive — and not just in Texas
Pricing data from Platts and CleanTrade/REsurety, compiled by S&P Global, shows the regional spread has widened sharply. In ERCOT, long-term newbuild solar PPAs were quoted at $40.59–$41.33/MWh in early March 2026. In PJM, long-term solar newbuild virtual PPA bids ran from roughly $75/MWh in early February to $80–83/MWh by early March. SPP’s South Hub solar offers ranged $58–75/MWh and its North Hub $69–72.5/MWh; MISO postbuild bids sat at $35–36/MWh with long-term newbuild pricing in the mid-$50s to upper-$60s. The premium for locking in a long-term contract over a short-term one has also widened — from roughly $1–2/MWh in mid-February to $3.2–3.9/MWh by mid-March, according to LevelTen Energy’s analysis, which attributes the structural rise to data center-driven load growth, the phase-out of federal clean-energy tax credits, and increasingly extreme grid pricing hours.
The regional divergence matters for site selection as much as for procurement. CAISO contracting fell to about 2 gigawatts in 2025 from more than 6 gigawatts the year before, while Texas added roughly 7.4 gigawatts of utility-scale solar in 2025 and is projected to exceed 9 gigawatts in 2026. A region with cheap land and power queue availability is not necessarily a region with cheap clean power anymore — the two numbers are starting to decouple, and that has direct implications for anyone comparing large-load tariff exposure across candidate markets.
Nuclear has become a real line item in the PPA stack
The other notable shift is how much nuclear capacity hyperscalers have folded into their procurement mix. Data centers procured nearly 6 gigawatts of nuclear capacity in 2025, and in January 2026 Meta announced three deals totaling up to 6.6 gigawatts of carbon-free nuclear power with TerraPower, Vistra, and Oklo, tied to plants in Ohio and Pennsylvania. That follows a broader pattern this site has tracked as utilities and generators squeeze more output from existing reactors rather than waiting on new builds — see our earlier look at why the fastest new nuclear power isn’t actually a new reactor. Google has separately moved to lock in Clearway Energy Group capacity (1.2 gigawatts of solar and wind) and has discussed buying up to 3 gigawatts of Brookfield hydropower, on top of long-term deals in Ohio and Malaysia with TotalEnergies.
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📞 Book a Discovery CallSolar-plus-storage hybrid PPAs are growing even faster off a smaller base: 2.4 gigawatts were signed in the fourth quarter of 2025, a ninefold increase from the prior quarter, as buyers use storage to firm up intermittent generation and manage curtailment exposure rather than relying purely on grid interconnection timing.
What the forecasts say about 2027 and 2028
S&P Global’s Horizons team models 2027 base-case solar PPA prices ranging from about $39/MWh in ERCOT West to $75/MWh at the PJM Western Hub. The caveat buyers should actually plan around is the downside scenario: in a lower-output case where capacity factors run 15% below the base assumption, 2028 solar prices could rise to roughly $52/MWh in ERCOT West and nearly $100/MWh in PJM — a 20–35% increase over base-case projections. None of this is certain; Horizons’ own figures are forecasts and analyst views, not realized outcomes, and a faster buildout of transmission or storage capacity could soften the curve. But the range itself — not the midpoint — is what a serious capacity plan should be modeling against.
Policy has added friction on top of price. Treasury and IRS guidance issued February 12, 2026, on Foreign Entities of Concern and “material assistance” rules now requires additional cost-tracing, documentation, and supplier certification for projects seeking federal clean-energy tax credits — compliance overhead that developers are, unsurprisingly, passing through into contract pricing and timelines.
What this means if you’re actually buying capacity
None of this means PPAs are a bad idea — more than half of data center operators surveyed by S&P Global’s 451 Research unit say sustainability credentials directly influence their vendor and site selection, and a locked-in power contract remains one of the few hedges against volatile grid pricing. The nuance is in who gets access to good terms. A hyperscaler signing a 1-gigawatt, 15-year deal is a different counterparty than a 20-megawatt colocation tenant, and developers are allocating scarce newbuild capacity accordingly. If you’re leasing colocation space, your power costs are likely passed through indirectly via your provider’s own procurement — which means it’s worth asking directly whether your provider has locked in long-term clean power at pre-2026 pricing or is still buying on the spot and short-term market. If you’re building or buying capacity directly, the message from this year’s data is to price your 2027–2028 power costs using the wider forecast range, not the optimistic midpoint, and to treat interconnection queue position and PPA access as two separate constraints that both need to clear before a site is actually viable.
The PPA market hyperscalers are now shaping will keep setting the reference price for everyone else buying data center capacity behind them — so the sooner your own power-cost assumptions reflect 2026’s actual contract terms rather than 2023’s, the fewer surprises show up in your build budget. For a structured way to work through site, power, and contract risk before you sign anything, see the TechInfraHub Data Center Buyer’s Toolkit.
Written by
Raajeev Ratra
Data Center Infrastructure Expert | 15+ Years in DC Design, Operations & Project Management
Raajeev is a seasoned data center professional with hands-on experience in hyperscale facilities, colocation design, power & cooling infrastructure, and global DC operations. He shares practical insights to help engineers and IT leaders build better infrastructure.