Power purchase agreements (PPAs) are contracts that have become popular among private firms attempting to meet voluntarily adopted climate goals. Using data from the U.S. EIA and Energy Acuity, we construct a dataset on the electricity generation portfolios for U.S. counties over 1990-2021 and estimate two-way fixed effects regressions to explore the effects of spatially and temporally varying PPAs on the deployment of renewables. We find that, in contrast to the voluntary renewable energy certificate market, PPAs have influenced aggregate renewable generation capacity, although the effects are heterogeneous. PPAs signed by non-utility entities (e.g., corporations) generally have a smaller effect than those signed by utilities, but the effects vary by the type of renewable energy project (solar or wind) and spatially based on renewable resource potential, with non-utility PPAs appearing more flexibly used. These findings offer valuable insights into the efficacy of PPAs in enhancing the RE transition and may serve as an aid in the decision making of governmental policymakers and non-governmental initiatives seeking to accelerate investment and growth in RE generation capacity.
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