APS households are using less energy but paying 23% higher costs

Residential customers in Arizona Public Service (APS) territory are experiencing significantly higher electricity costs despite a decrease in energy usage, according to an analysis by longtime consumer advocate Abhay Padgaonkar. Padgaonkar's findings indicate that the average homeowner in APS territory used 5.5% less electricity in 2025 compared to 2022, but faced 23% higher costs per kWh. Conversely, the business sector, largely driven by data centers, saw an 18% increase in electricity usage and an 18% cost hike per kWh, accounting for 96% of total energy usage growth. Consumer advocates, including Diane Brown of PIRG, contend that this disparity suggests data centers are contributing to rising residential electricity bills. They argue that the current rate structure needs correction and advocate for greater transparency in financial agreements between data centers and utilities. APS spokesperson Jill Hanks, however, states that Padgaonkar's analysis is "oversimplified" and denies that residential customers are subsidizing business growth, noting a multi-year lag in cost recovery. APS is proposing a 45% rate hike for data centers and a 14% hike for residential customers in the current rate case. The debate is ongoing, with consumer advocates participating in a data center workshop at the Arizona Corporation Commission (ACC), chaired by former ACC Chair Kevin Thompson. While Thompson and current Commission Chair Nick Myers believe data centers are not shifting costs, advocates are pushing for policies to strengthen collateral requirements, contracts, and transparency, particularly regarding non-disclosure agreements (NDAs).