City leaders voted down a data center in Chandler last week, but Arizonans can expect to see even more proposed.
The state offers tax breaks for data center projects –significant incentives, Governor Katie Hobbs says, are “clearly working.” On Wednesday, she suggested state lawmakers take another look to find “the right balance.”
“We should look at the incentives to make sure they're doing the right thing, and that we have a better strategy around it,” she said.
But Hobbs isn’t calling for a statewide mandate, noting that some communities in Arizona want to be home to data centers.
“That property tax base is really helpful to some cities that are growing,” she said.
While the Chandler City Council rejected a proposed data center in that city, the controversial Project Blue is moving forward in Pima County.
Tucson residents opposed to the massive data center complex have told ABC15 they’re worried the project could result in higher power rates for consumers.
“One of the biggest things that communities across the United States have seen is how the increased need for power brought by data centers directly translate to an increase in rates for ratepayers,” Marisol Winfrey Herrera with the group No Desert Data Center Coalition said last month after an Arizona Corporation Commission meeting.
She and others with her group also said they were concerned about water usage.
Arizona could see big cuts to its allocation of water from the Colorado River, which has been diminished by decades of drought and overuse.
Hobbs said she hears the concerns, saying her administration’s Arizona Energy Promise Task Force is looking at how to ensure costs don’t hit consumers.
“We have to make sure that these large load users are paying for their share of the utilities that they're using,” she said.
Water is “part of the conservation, Hobbs said, adding that there’s technology to help data centers reduce their water consumption.
Hobbs spoke to reporters in Phoenix after addressing a Western Governors Association workshop on energy policy.
“The fact is that America's energy future runs through Arizona and other Western states,” she said. “We stand on the frontier of energy, innovation and generation, and our collective power has the ability to support and promote American advancement for generations.”
Hobbs touted Arizona’s TSMC semiconductor facility, which produces the most advanced chips manufactured in the U.S. Later, she told reporters the state needs to work together to address the energy challenges raised by both high-tech manufacturing and data centers.
“We need to have a more comprehensive strategy around not just data centers, but these large-load users that are coming to the state,” she said.
