Energy Equity: A Crucial Focus for ACC Election

As a pivotal swing state, Arizona’s election season conversations are heavily influenced by the presidential race. However, attention should also be directed towards the November ballot, which features six candidates competing for three positions on the Arizona Corporation Commission (ACC). This commission plays a crucial role in regulating the state’s utilities and has the authority to approve rate increases that could lead to higher household energy bills.

Given that Arizonans already contend with some of the highest energy costs in the nation, the candidates for the ACC must address a pressing issue: How can they protect Arizona households from bearing the financial burden linked to the demands placed on the state’s energy grid, especially with the growing presence of tech companies and their energy-intensive data centers?

Nationwide, states are grappling with the challenges posed by the influx of data centers that sustain digital advancements, from cloud services to artificial intelligence. This surge in data center electricity consumption is projected to triple by 2030, potentially resulting in significant cost implications for consumers. For instance, in Virginia, estimates suggest that the average household might face a doubling of electric bills by 2035 due to similar strains on the grid.

Arizona, rapidly emerging as a hub for data centers in the West, is not immune to these impacts. A recent report from the Electric Power Research Institute (EPRI) indicates that energy demand from data centers in Arizona could more than double by 2030. Arizona Public Service (APS), the state’s largest utility, is already facing challenges in meeting these increased demands, warning that without essential infrastructure upgrades, it could exhaust its transmission capacity by the decade’s end.

The consequences for Arizona families are likely to be continued spikes in energy costs. In February, the ACC sanctioned a rate increase for APS, resulting in potentially $12 more per month for the average household. This decision was part of a broader series of ACC rulings that have raised concerns among watchdog groups within the state and opposition from the Residential Utility Consumer Office (RUCO), Arizona’s ratepayer advocate.

While supporters of data centers tout them as catalysts for economic growth, voters should critically assess these assertions. Although data centers might boost local property tax revenues, they typically generate limited job opportunities. The intense resource consumption—ranging from massive electricity demands to daily water usage of 1 million to 5 million gallons needed for cooling—is a significant concern, especially in Arizona’s arid climate. Compounding this issue is the incentive of millions in taxpayer dollars extended to attract these facilities.

The central question for voters considering the ACC candidates this November is whether Arizona families should absorb the increased energy costs associated with these data centers and the subsequent infrastructure needs, or whether the entities exerting the most strain on the grid should contribute equitably to the costs.

Arizona stands out as one of only ten states where public utility regulators are elected, in contrast to being appointed by governors in most states. This unique setup empowers residents to influence energy policy directly. As such, the candidates for the Arizona Corporation Commission must articulate their strategies for ensuring energy cost fairness, enabling voters to make informed decisions about the future of the state’s energy landscape.