What is the scale and timeline of the solar and battery project Tesla has agreed to buy power from in Arizona?

Tesla has agreed to purchase 90% of the output from Project Sterling, a KKR-backed solar and battery facility in Arizona developed by ContourGlobal; the project will include 509 megawatts of peak solar generation and 360 megawatts of four-hour battery storage, and is scheduled to begin operating in 2028.

Why is Tesla’s entry into a long-term power purchase agreement (PPA) considered notable, and what broader market trend does it reflect?

Tesla’s PPA is rare because the company typically buys electricity from local utilities and grids rather than entering long-term contracts with independent power producers; this deal reflects the growing need for tech companies to secure stable, clean power amid surging demand from AI-driven data centers, which are straining US electricity networks and accelerating adoption of renewable-plus-storage projects.

Tesla to Buy Power From KKR-Backed Arizona Solar, Battery Plant

Jul 28, 2026

Tesla agreed to buy 90% of output from a new Arizona solar and battery plant to support AI data center energy needs, with operations starting in 2028.

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