The largest utility in Arizona has a problem. It needs more energy.
“It’s hard in the world we live in today to live without electricity.”
Johnny Penrod works for Arizona Public Service. And the buzzing sound from this power plant in the Phoenix suburb of Tempe is relatively quiet. But if the power turbines were on, we wouldn’t be able to talk.
“Basically like a 737 jet engine is what it is.”
Demand for power in Arizona is expected to keep rising. And meeting that demand can mean life or death in the desert, where temperatures stay above 110 degrees in the summer.
“Here, we can do something to make sure we keep the lights on for our customers.”
And to keep the air conditioners running.
So, the utility has turned to a pipeline company to bring in more natural gas from Texas.
The state’s rising population is driving the need for more power, but data centers, including the ones AI relies on, need more power, too.
“I think natural gas is going to play that part.”
Kevin Thompson is chair of the Arizona Corporation Commission, which regulates utilities. Renewables, including solar, are a part of the utility's portfolio, but not as reliable at all times. So data centers raise an immediate issue…
“It's going to take more generation. It's going to take dispatchable, reliable generation that can be dispatched at night time.”
The Department of Energy estimates the demand from data centers could nearly triple in the next three years. Nationally, they could use 12-percent of all energy.
The Trump administration’s energy secretary, Chris Wright, spoke about meeting that skyrocketing demand recently with the Council on Foreign Relations.
“With his abundant source of natural gas, that's what's going to power our data centers."
The national renewable energy laboratory tracks data centers, and their map shows some of the major hot spots in the Mountain West – from Wyoming to Colorado, Utah to Nevada… and, of course, Arizona, where driverless taxis are an increasingly common sight.
Tom Maples pages through notes at the DPR Construction office.
He’s a project manager with the company, which builds data centers. One of his latest projects was for Meta - in another Phoenix suburb.
“It's really growing very fast in Arizona and around the country, more so in the last two years.”
Maples says building energy efficient data centers is just good business. But many will still contend with high utility bills.
“As AI has come on…there’s a lot more electricity being consumed.”
Amid this unprecedented demand, some major utilities have slowed their transitions to renewables.
Arizona Public Service is among them. It ended its goal to be carbon neutral by 20-50.
Some are concerned the demand is pushing residential bills up, like Abhay Padgoankar, a consumer advocate. He argues that Arizona Public Service is trying to serve too many new data centers.
“They don't have the capacity for it.”
The utility says it’s more complicated than that though. Still residential bills jumped about 8 percent last year.
“We as residential customers are doing the right things by conserving energy…by installing solar, by buying energy efficient appliances. We’re doing all the right things. ”
As data centers grow, so will the demands for more power from the utility, which helps explain why it is moving ahead with the natural gas pipeline.
Johnny Penrod says the utility aims to produce enough power for everyone.
“Basically to keep people safe. Keeping the lights on is so important for everybody. ”
Including the data centers.
For the Mountain West New Bureau, I’m Greg Hahne.