Tesla Signs PPA for 140MW Texas Solar Farm to Power AI and Gigafactory
Tesla has signed a long-term power purchase agreement (PPA) with developer Zelestra to buy the entire 140MWac output of the upcoming Lumen Farm solar project in Texas. The project is scheduled to begin construction in 2027 and become operational by 2029. The deal highlights the surging energy demands of AI data centers and advanced manufacturing, forcing tech giants to aggressively secure clean energy sources. It also reveals that despite owning its own solar business, Tesla must rely on third-party developers to meet its immediate power needs. While the financial terms were not disclosed, the power will feed into the Texas grid (ERCOT) to support Tesla's local operations, including Gigafactory Texas and its expanding AI infrastructure. Zelestra, which also supplies power to Meta, will develop the project.
## BACKGROUND
A Power Purchase Agreement (PPA) is a long-term contract where a buyer purchases electricity directly from a generator at a pre-negotiated price. Tesla acquired SolarCity in 2016 to build its own solar business, but later downsized it to focus on electric vehicles and Megapack battery storage, leaving it temporarily unable to self-supply its utility-scale energy demands.