Arizona city and industry leaders look for new data center standards as public opposition grows
Public opposition to data centers is increasing in Arizona, particularly in Phoenix, due to concerns over electricity and water consumption, prompting calls for stricter development standards. Phoenix city leaders are seeking more stringent requirements, while Arizona state lawmakers have paused tax incentives for new data centers for three years. The Arizona Corporation Commission is also reviewing a proposed electricity rate hike by APS, which includes a significant increase for large users like data centers.
Public opposition to data center growth is intensifying across the U.S., particularly in Arizona, a major data center hub. This sentiment was evident at a recent protest in Phoenix, where residents like Nile Bunger and William Carter voiced concerns to the Arizona Corporation Commission about a proposed 14% electricity rate hike by APS. They argued that data centers, which account for a significant portion of increased power demand, should bear more of the cost, as APS is also seeking a 45% rate increase for larger users.
In response to the growing demand and public outcry, city and state leaders in Arizona are re-evaluating existing standards for data center development. Phoenix Mayor Kate Gallego has emphasized the need for more stringent requirements, encouraging data centers to be better neighbors, minimize pollution, use sustainable energy, and protect water supplies. She recently joined an international pact of cities advocating for such standards.
The industry itself, through organizations like ASHRAE, is also updating its standards, including an addendum to address overall water and energy use. Meanwhile, Arizona state lawmakers voted in June to enact a three-year moratorium on tax incentives for new data centers, though 113 applications were filed just before the pause. Steve Zylstra, President of the Arizona Technology Council, acknowledged the moratorium as an opportunity for the state to develop more responsible accommodation strategies for tech facilities. The Arizona Corporation Commission is expected to decide on APS's rate hike by year-end.