Tesla has inked a 1TWh power purchase agreement (PPA) with ContourGlobal for the Sterling hybrid solar & BESS project in Arizona. The firms have signed a long term agreement that will see Tesla assured of long term energy supply. Under the terms, the US electric car maker will source around 90% of the Sterling plant’s expected annual output. Furthermore, it will purchase bundled electricity and renewable energy certificates (RECs) from the facility, ContourGlobal said on Tuesday.

Project Sterling is a development combining 450 MWac/509 MWdc of solar photovoltaic capacity with a 360-MW battery energy storage system (BESS). Moreover, it provides more than 1.4GWh of storage capacity thanks to the battery storage. The hybrid plant is expected to generate more than 1.1 TWh of electricity annually once operational and will become ContourGlobal’s largest renewable asset to date.

Another major energy project advancing is the West Alton Energy Center by Ameren Missouri. The firm has confirmed its plans for the combined-cycle natural gas facility in the US. The company is a subsidiary of Ameren Corporation. It has applied to the Missouri Public Service Commission (MoPSC) for approval of the plant. It will aim to supply continuous electricity to customers across the state.

Outlook on the Sterling Hybrid Solar & BESS Project in Arizona

Located in Arizona’s Western Area Power Administration (WAPA) region the Sterling hybrid solar & BESS project has firm transmission rights into California’s CAISO market. Furthermore, it is designed to supply Tesla’s energy needs through a pseudo-tie arrangement, the client company noted. The UK-based firm acquired Sterling at the development stage in December 2024. Ever since, it has redesigned the project to meet the off-taker’s requirements, the company said.

Construction activity began in 2025 with off-site work and equipment procurement. On the other hand, on-site construction is planned for 2026. Commercial operations are targeted for 2028. Sterling is the second PPA with Tesla announced on Tuesday. Earlier in the day, Spain-based Zelestra said it had secured Tesla as the full off-taker of electricity generated by its 140-MWac Lumen Farm solar project in Texas.

Project Overview

• Project: Sterling Solar & BESS
• Location: Arizona, USA
• Developer: ContourGlobal
• Status: PPA signed with Tesla

Scope

• 450MWac solar capacity
• 360MW battery storage
• 1.4GWh storage capacity
• Over 1.1TWh annual generation

Project Highlights

• 1TWh long-term PPA
• Tesla to buy 90% of output
• Includes renewable energy certificates
• Largest ContourGlobal renewable project

Key Developments

• Acquired in December 2024
• Project also redesigned for Tesla
• Off-site works underway
• On-site construction starts in 2026

Timeline

• Development acquired in 2024
• Early works also started in 2025
• Main construction in 2026
• Operations also planned for 2028

Outlook

• Long-term clean energy supply for Tesla
• Supports Arizona renewable expansion
• Strengthens battery-backed solar generation
• Also enhances power delivery into California