Arizona Data Center Boom Pressures Power Grid, Raises Questions on Electricity Costs
Arizona's booming data center industry is creating immense pressure on the state's power grid, leading to record electricity usage and prompting questions about who will bear the costs. Arizona Public Service (APS), the state's largest power provider, recorded an all-time high usage rate of 9,164 megawatts (MW) on August 2, 2026, a 6% increase from the previous year. Data centers accounted for 7% of APS's peak demand last summer, and dozens more are planned or under construction. Two proposed projects in the desert west of Phoenix, Tract in Buckeye and Hassayampa Ranch, could draw up to 3,300 MW combined, equivalent to powering approximately 528,000 Arizona homes. APS is seeking state regulatory approval to raise residential rates by 14% and extra-large user rates, including data centers, by 45%. This has sparked concerns among consumer advocates and residents, who are already facing soaring electricity bills, with some homeowners seeing bills over $1,000 a month during summer.