US Clean Power PPA Prices Jump 40%-120% as Trump Ends 30% Tax Credits
Updated
Updated · Financial Times · Jul 4
US Clean Power PPA Prices Jump 40%-120% as Trump Ends 30% Tax Credits
3 articles · Updated · Financial Times · Jul 4
Summary
LevelTen Energy said US clean-power purchase agreement prices are set to rise 40% to 120% after renewable projects starting after July 4 lose Biden-era tax credits; in Texas, prices could climb from $55 to $121 per megawatt-hour.
The squeeze reflects two forces at once: Trump's bill ends subsidies worth roughly 30% of development costs, while AI-driven data centers are absorbing scarce renewable supply and strengthening developers' pricing power.
Factories, retailers and other corporate buyers say hyperscalers are outbidding them for contracts, while higher transformer, labor, financing and grid-connection costs are adding further pressure to renewable deal prices.
US electricity demand is projected to grow 25% to 50% by 2050, and companies still want clean power for climate goals and price hedging, even as some buyers delay deals over emissions-accounting rule changes due in 2027.
As clean power prices skyrocket, are corporate climate pledges becoming an unaffordable luxury?
Will the AI revolution's energy thirst break America's aging power grid?
Beyond solar and wind, what untapped energy sources can satisfy AI's insatiable demand?
$500 Billion at Stake: The Impact of the 2025 Federal Tax Overhaul on US Clean Energy Markets and Policy
Overview
In early 2026, North American clean power PPA prices surged as the market tightened and the policy landscape shifted. The average solar PPA price rose by 9% from late 2024 to late 2025, driven by the impending expiration of key federal tax incentives. This 'July 4 cliff' marked the end of the current tax era for renewable energy assets, prompting developers to adjust pricing strategies to recover lost incentives. As a result, PPA rates increased, with demand from sectors like data centers adding further pressure. These changes reflect a market adapting quickly to new policy and economic realities.