Average prices for solar power purchase agreements (PPAs) in Europe rose 0.4% between the second and third quarters of 2026, according to the latest data from LevelTen Energy. In the United States, prices increased by 4.9%.
LevelTen attributes the European increase to macroeconomic factors, including higher photovoltaic module prices and interest rates. Rising costs are increasing project development expenses and pushing PPA prices slightly higher to maintain project financial viability.
The consultancy has also changed how it presents its data. Rather than reporting prices directly in euros per megawatt-hour, it now uses an index based on prices eight quarters earlier, assigning the reference period a value of 1.00.
Under this methodology, the European solar PPA price index stood at 0.86 in the third quarter of 2026, equivalent to 86% of the price recorded in the third quarter of 2024, when the average reached €63.64/MWh. The wind PPA index stood at 0.99, indicating a much smaller decline over the same two-year period.
The quarterly increase therefore does not offset the cumulative fall in solar PPA prices since 2024. Instead, the data point to recent stabilization following a more pronounced period of decline.
Contracts combining renewable generation with battery energy storage systems (BESS) are gaining traction across Europe. LevelTen reported hybrid PPAs in nine European markets during the third quarter, with Spain and Portugal accounting for almost half of the hybrid contracts recorded across the region.
7% year on year. LevelTen considers prices to be approaching the lower limit at which projects can still secure financing.
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