Phoenix Mayor Kate Gallego called data centers \u201cthe biggest change [she] has seen in her decade at the city\u201d, at the July 2 city council meeting.<\/p>\n
“Data centers, yes, I’ll take it all day and keep it coming,” said Andrew Bart, an AI entrepreneur whose company AlgoFace uses artificial intelligence to track human faces anonymously.<\/p>\n
Bart believes data centers are essential for Arizona’s economic growth and technological advancement.<\/p>\n
“We need to make sure Arizona is a growing economy and we are on the forefront of whatever industry is the latest and greatest. Unequivocally, AI is that right now,” Bart said.<\/p>\n
Outside of positioning the state for economic growth, Bart also says it\u2019s important for the U.S. to be the leader in AI.<\/p>\n
\u201cI have three children, there is no way in the world I want a country like China to be a leader in AI, I want the best ethical standards.\u201d Bart said. \u201cI want the United States to be the leader for my children and their sake.\u201d<\/p>\n
Potential APS rate hikes<\/b><\/p>\n
The surge in AI applications requires significantly more power than traditional technology, creating unprecedented demands on the electrical grid.<\/p>\n
“Our average request at this point is 500 megawatts,” said Patrick Bogle, APS data center strategist.<\/p>\n
That average data center request equals the power consumption of 500 big box stores, as these facilities operate 24 hours a day, 365 days a year.<\/p>\n
\u201cWe\u2019d have to build two new SRP\u2019s and APS\u2019s to keep up with all the requests data centers are making,\u201d Phoenix Mayor Kate Gallego said.<\/p>\n
“We currently have 19 gigawatts of requests for service. We can’t serve that today,” Bogle said. “We don’t have the infrastructure to support all of the requests we have seen.”<\/p>\n
That\u2019s where Mayor Gallego is concerned, saying she expects consumers to bear some of the costs of expanding power infrastructure to meet data center demands.<\/p>\n
“Data centers are raising your electric price,” Gallego said. “The CEO of APS was honest. Part of the reason APS asked for a 14% increase in your electric bill is to provide data centers with electricity.”<\/p>\n
Bogle said APS is working to ensure the largest energy consumers pay their fair share through specialized rate structures.<\/p>\n
“We have an extra high load factor rate class intended for data centers,\u201d Bogle said. \u201cAs part of our rate case that is currently filed, we have a growth pays for growth strategy, ensuring the customers causing the system to grow over time are paying that cost.\u201d<\/p>\n
You can read the rate hike request for yourself here<\/a>.<\/p>\n Bogle adds that they would not agree to connect a data center if there was any concerns about it putting the grid at risk, and they are putting many data centers under a \u201csubscription model\u201d payment plan.<\/p>\n \u201cIt has allowed us to bucket the incremental costs to serving data centers to a portfolio, and data centers would take service under that portfolio,\u201d Bogle said.<\/p>\n Overall, there are still concerns from Mayor Gaellgo about data centers paying their fair share, as she says small businesses pay a higher tax rate in the state.<\/p>\n \u201cRight now, if you go out to your local small business, their sales tax rate is higher than a data center. This is a mature industry, they\u2019re coming in huge numbers, I\u2019d like to see them pay their fair share in taxes,\u201d Gallego said.<\/p>\n Critics question long-term planning<\/b><\/p>\n Amanda Ormund, who has concerns about data center growth, worries about the financial risks if the AI economy shifts or technology becomes more efficient.<\/p>\n “My concern is that if the utilities build 50% more power, and either these data centers don’t show up or become more energy efficient, then customers pay for that,” Ormund said. “I don’t think we’re doing the planning.”<\/p>\n Ormund is also concerned about the environmental impacts of increasing power output<\/a>.\u00a0<\/b>APS has modified its environmental commitments, now aiming to be carbon neutral rather than carbon free by 2050.<\/p>\n Bogle says part of the challenge with serving data centers is that renewables like solar are not as effective for powering something that requires a constant connection.<\/p>\n “The sun is not shining overnight. We still need some power generation that can serve that power generation by a data center,” Bogle said.<\/p>\n One of the new ways APS is proposing to add to power output is a natural gas pipeline being built from Texas to Arizona. Ormund believes other cleaner options have not been properly considered.<\/p>\n \u201cThis pipeline proposal has not been evaluated at the Arizona Corporation Commission, so we have not talked about other ways we could meet load growth,\u201d Ormund said.<\/p>\n Policy responses emerge<\/b><\/p>\n The Phoenix City Council recently adopted new data center policies aimed at promoting responsible growth<\/a>. Changes include updating their zoning ordinances and how much noise the centers can give off near residences.<\/p>\n \u201cPhoenix is not banning data centers, we\u2019re planning for them responsibly,\u201d said Planning and Development Director Josh Bednarek. \u201cThe new process requires earlier discussions with City staff for each new facility to evaluate its location and ensure health and safety concerns are met to protect residents and the surrounding community.\u201d<\/p>\n Mayor Gallego says the new ordinances will prevent future data centers from being a public nuisance.<\/p>\n \u201cWe have residents who contact my office and say\u2026now I have a view from my front yard of a diesel turbine,\u201d Mayor Gallego said. \u201cSo we are trying to do better and make sure we have a high level of design for these investments,\u201d<\/p>\n While Phoenix has established some new guidelines and guardrails, Gallego believes state-level action is needed.<\/p>\n \u201cI\u2019m asking everyone in Arizona to pay attention,\u201d Gallego said. \u201cRight now, if you go out to your local small business, their sales tax rate is higher than a data center. This is a mature industry, they’re coming in huge numbers, I’d like to see them pay their fair share in taxes.\u201d<\/p>\n Going forward<\/b><\/p>\n Whether or not more data centers are allowed to come to the Valley will answer some broader questions about Arizona’s technological future. Entrepreneurs like Bart believe this is a chance for Arizona to be part of the biggest technological change since the internet with AI advancement.<\/p>\n “It’s inevitable, either they’re coming here or going somewhere else,” Bart said.<\/p>\n While others like Ormund hope our leaders plan responsibly.<\/p>\n “What is the impact on water, livability, on heat, policy makers have not had public discussions on is this the future we want,” Ormund said.<\/p>\n There is some public pushback for Data Centers in Arizona. Project Blue, a major data center run by Amazon Web Services, planned to be built in Tucson<\/a>, was stopped by the city council after public protests.<\/p>\n The first public hearings on the APS proposed rate hike will be in January<\/a>.<\/p>\n
![](\"https:\/\/www.europesays.com\/us\/wp-content\/uploads\/2025\/09\/1757723594_712_liveplayerbanner1.png\"\/)
<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Data centers are the backbone of everything from Google searches to movie streaming. Now, with artificial intelligence adoption…\n","protected":false},"author":3,"featured_media":222633,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5131],"tags":[5229,5643,1587,1589,67,586,132,5230,68,2969],"class_list":{"0":"post-222632","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-phoenix","8":"tag-america","9":"tag-arizona","10":"tag-az","11":"tag-phoenix","12":"tag-united-states","13":"tag-united-states-of-america","14":"tag-unitedstates","15":"tag-unitedstatesofamerica","16":"tag-us","17":"tag-usa"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115195077184483888","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/222632","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=222632"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/222632\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/222633"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=222632"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=222632"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=222632"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}