First Solar Inc (FSLR.O) said Pacific Gas and Electric Co (PCG.N) would purchase 72 megawatts (MW) of solar electricity to be generated at two plants being developed in California by the solar panel maker.
First Solar shares were up 4 percent in premarket trading on Tuesday. They closed at $20.79 on the Nasdaq.
The 32-megawatt Lost Hills project in Kern County and the 40-megawatt Cuyama project in Santa Barbara County are expected to create up to 600 jobs at peak construction.
Construction of the projects, which will produce enough energy to power some 24,000 California homes, could start in 2013.
SunPower Corp (SPWR.O) signed a power purchase agreement with PG&E for a 100 MW plant in Southern California last week.
(Reporting by Swetha Gopinath in Bangalore; Editing by Saumyadeb Chakrabarty)