Tesla has signed a long-term agreement to buy electricity from a massive solar and battery storage project in Arizona.
The power purchase agreement (PPA) is with renewable energy developer ContourGlobal, and covers 90% of the output from Project Sterling, a utility-scale solar and battery facility currently under development.
The project is expected to begin supplying electricity in 2028.
When completed, Project Sterling will feature 509 megawatts (MW) of solar generation alongside a 360 MW battery energy storage system capable of delivering power for nearly four hours. ContourGlobal says the project is their largest renewable asset and will generate roughly one terawatt-hour (TWh) of electricity annually, with Tesla purchasing the vast majority of that output.
The financial terms of the agreement were not disclosed.
The deal is a rare one for Tesla, which has historically relied on local utilities to power its operations rather than signing large-scale PPAs. However, demand for electricity is increasing rapidly across the U.S., driven largely by the expansion of AI infrastructure and data centers, something which the company is leaning more heavily into lately.
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