CALGARY, Alberta (July 15, 2026) — Enverus Intelligence® Research (EIR), a subsidiary of Enverus, is releasing a new report that analyzes the widening gap between the cost to build new combined-cycle gas turbines (CCGT) and the price paid for existing gas-fired power assets.
EIR’s analysis of 76 combined-cycle gas turbine projects with publicly disclosed capital costs and commercial operation dates from 2014 to 2033 found that new gas-fired power generation costs have roughly doubled, rising from an average of about $0.9 million/MW for plants online before 2023 to about $2.0 million/MW for the post-2027 cohort. At the same time, operating gas-fired power plant M&A multiples have also doubled, from about $0.5 million/MW before 2025 to about $1.0 million/MW last year.
The result is a replacement-cost wedge of roughly $1.0 million/MW, with buyers of existing assets paying about 50 cents on the dollar compared with the cost to build new capacity. EIR points to this explanation as to why capital allocators have favored acquisitions over greenfield merchant builds, particularly while current energy and capacity prices remain below levels needed to finance new construction.
“Newbuild CCGT costs have moved high enough that the economics increasingly favor buying existing, grid-connected capacity over building new merchant plants. That replacement-cost wedge is now a central factor in power-sector capital allocation, supporting incumbent asset values while limiting the near-term on-grid supply response,” said report author and EIR analyst Brynna Foley.
Key takeaways:
- Costs for new gas-fired power generation have roughly doubled, from about $0.9 million/MW for plants online before 2023 to about $2.0 million/MW for the post-2027 cohort.
- Operating gas-fired power plant M&A multiples have also doubled, from about $0.5 million/MW before 2025 to about $1.0 million/MW last year.
- At about $2.2 million/MW, greenfield CCGTs require roughly $500/MW-day capacity payments in PJM Interconnection or about a $70/MWh power purchase agreement in ERCOT to be financeable.
- EIR views the wedge as a structural floor under incumbent independent power producer valuations and a tailwind for capacity and scarcity pricing, while noting risks from turbine price normalization and slower-than-expected data center demand growth.
Figure 3 | Newbuild Cost vs. Gas-Fired Power M&A Over Time
EIR’s analysis pulls from a variety of products including Enverus ONE.
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About Enverus Intelligence® Research
Enverus Intelligence ® | Research, Inc. (EIR) is a subsidiary of Enverus that publishes energy-sector research focused on the oil, natural gas, power and renewable industries. EIR publishes reports including asset and company valuations, resource assessments, technical evaluations and macro-economic forecasts; and helps make intelligent connections for energy industry participants, service companies and capital providers worldwide. Enverus is the most trusted, energy-dedicated SaaS company, with a platform built to create value from generative AI, offering real-time access to analytics, insights and benchmark cost and revenue data sourced from our partnerships to 95% of U.S. energy producers, and more than 40,000 suppliers. Learn more at Enverus.com.
