Arizona Data Centers and Navajo Energy Access

Author: Nora Lewis

Suggested Citation:

Lewis, N. (2026). Arizona data centers and Navajo energy access. Technology Assessment Project Case Study Library, University of Michigan. https://stpp.fordschool.umich.edu/tap-case-study-library/arizona-data-c…

Arizona Data Centers and Navajo Energy Access

Key Takeaways

• Infrastructure posited as "critical" often results in non-democratic decisionmaking, ignored public health harms, and inequitable resource distribution.
• Policymakers and technologists will use the promise of jobs and "economic growth" to promote projects that ultimately harm communities.
• Hyped technology and emphasis on "short-term" needs can open up harmful forms of resource extraction, including a reliance on fossil fuels.
• Low-income communities and communities of color bear the brunt of negative health and environmental harms associated with this rapid tech expansion.

Data center development has gathered considerable momentum in the United States, framed by technologists and policymakers as "critical infrastructure" for the future. These centers, used to store computer systems and support services such as artificial intelligence (AI), have slowly begun to foster a new landscape for energy regulation. In places such as Arizona, one of the leading states for data center development, this regulation reflects a growing sensitivity to the interests of large tech companies (Verma, 2024). Officials have welcomed data center projects from Google and Meta, promising state-wide economic benefits (Obando, 2024). AI technologies in particular require immense computing power, and as AI use balloons across sectors, data centers prove pivotal to sustaining this growth. But this boom comes with countless negative side effects, and reveals the skewed priorities of policymakers and regulators.

These priorities are shockingly clear in the decisionmaking of the Arizona Corporation Commission (ACC), the state's utility board. In February of 2024, the board voted to approve an eight percent hike in rates for its customers in order to support burgeoning data center projects (Arizona Public Service, 2024; Verma, 2024). At a hearing for the proposed hike, Ted Geisler, president of the Arizona Power Service, stated that "It's our responsibility to provide the critical infrastructure needed to power this unprecedented economic growth we're seeing here in Arizona" (Verma, 2024). Yet this agenda stretches back almost a decade, with state officials offering generous tax incentives for data center construction in Arizona since 2013 (Verma, 2024). In the past six years, Maricopa County has built 12 data centers, with more than 20 data center projects in the pipeline (Verma, 2024). This means surging energy demands for the state, as well as mounting water and land demands to cool and house data center infrastructure (Chow, 2024). As utilities struggle to meet these demands, they are ceding precious resources away from communities.

The ACC's alignment with tech corporations is also clear in proposals they've failed to pass. The same month that the board passed the data center rate hike in 2024, they also rejected a proposal from a power company which sought to bring electricity to homes on Navajo Nation land using extra ratepayer dollars, arguing that customers should not bear the burden of expanding electricity access for tribal communities (New Mexico Political Report, 2024; Verma, 2024). Hundreds of Navajo households go without electricity each year, forcing people to rely on wood and coal-burning appliances that release dangerous particulates harmful to their health (Verma, 2024). Residents are often unable to store meat, vegetables, or other perishables safely because they can't electrify refrigerators (Verma, 2024). Many must boil water in order to take a warm shower, or are unable to power life-saving medical devices such as oxygen tanks (Verma, 2024). These homes are situated on one of the largest spreads of unelectrified land in the United States, many surrounded by looming power lines which fail to serve them (Verma, 2024). Even when citizens voiced support for the proposal in public meetings, board members rejected what could've been life-altering service expansion for hundreds (Verma, 2024). It's a case of decisionmakers side-stepping responsibility for equitable resource distribution, blaming high costs, while actively allotting ample resources to other projects that will also ultimately use lots of taxpayer dollars.

In their unwillingness to electrify Navajo homes, the ACC made clear that their interests lie in data center-derived "unprecedented economic growth." But this focus on alleged citizen benefits and economic growth is misleading. Beyond evidence that these data centers provide few meaningful job opportunities for local communities, their environmental toll represents another grave challenge for the future (Verma, 2024). Beyond electricity drains, the aforementioned drain to water supplies in an already drought-prone desert state represents another problem. A handful of towns have even passed ordinances to deter tech corporations from using their water supplies to cool data center equipment, which heats up when operating and can cause equipment failure without proper cooling (Verma, 2024). Others worry that the immense power needs of data centers cannot be captured with renewable or carbon-free technologies alone, and will drive developers back to fossil fuels.

This thinking isn't far-fetched, particularly when examining the expansion of a large natural gas plant in the historically Black town of Randolph, Arizona (Clark, 2023). Randolph has housed natural gas facilities since 2011, with evidence that particulate matter released by the plant has contributed to widespread asthma and lung cancer cases (Verma, 2024). The town was one of few in which Black families could buy property in the 1920s and 30s, and became a small but close-knit enclave for Black, Mexican, and Native American families by the 1960s (Lakhani, 2023). It began as an agricultural community for cotton crops, but was slowly industrialized throughout the 20th century, giving way to polluted fields, declining population, and industries such as a steel company contracted by Donald Trump to build the border wall (Lakhani, 2023). Since this industrialization, the town has been no stranger to hazardous conditions. In 2021, a natural gas pipeline exploded and killed a farm worker and his 14-year-old daughter (Griffith, 2022). The natural gas plant is bright and painfully loud, releasing toxic particulates into the air (Lakhani, 2023).

A proposal from public utility Salt River Project (SRP) to double the size of this plant was rejected in 2023, but ACC regulators reversed this decision later that same year, after SRP scaled down the expansion and promised greater community investment, such as scholarships and a "home rehabilitation program" (Lakhani, 2023; Walton, 2023). Environmentalist groups such as the Sierra Club have still critiqued the deal, arguing that SRP is "manipulating established processes to get their way" (Walton, 2023). These "reinvestments" in a community harmed by fossil fuels cannot erase the costs to public health and quality of life already deeply felt by the community, and in the face of data center development, fail to protect residents from a future of energy strains and greater fossil fuel reliance. It's no surprise that in the wake of the data center scramble, communities of color and low-income Arizonans face the greatest threats to their livelihoods.

Positive framing of data center projects in Arizona is part of a rapidly intensifying interest in AI development worldwide. From education, to the financial sector, to medicine, the allure of this cutting-edge technology has seeped into almost every field. While leaving us with large philosophical questions, like how this will impact employment and inform how we process information, there are already tangible impacts to be seen in places like the Navajo Nation and Randolph. The proof is in the pudding of ACC votes, lung cancer diagnoses, and unelectrified trailer homes across Maricopa County. The "critical" and "short-term demands" for data centers and energy needs have opened the door to an array of harms deemed secondary to technological growth. As data centers become more numerous with each passing day, Arizona's energy priorities will be mirrored elsewhere.

Relevance to Advanced Nuclear Energy

The Arizona data centers case, while not only relevant to advanced nuclear energy because new reactors are being developed to power data centers, is also relevant when examining how energy and resource allocation more broadly can be governed by inequity and non-democratic decisionmaking. In the Arizona case, the needs of low-income, Indigenous communities in the Navajo Nation were ignored in exchange for supposed economic and technological "innovation" for the state. While some proponents see the potential for advanced reactors such as SMRs to foster community governance and engagement, the data center case shows how public benefits and equity are often viewed as acceptable collateral for economic gain.

Key Sources

Lakhani, N. (2023, March 20). 'They keep coming back': A Black community in Arizona battles power expansion plans again. The Guardian.

New Mexico Political Report. (2024, February 26). Arizona regulators reject proposal to assist Navajo communities impacted by coal-fired power generation.

Obando, S. (2024, September 13). Phoenix GC breaks ground on $70M data center in Mesa, Arizona. Construction Dive.

Verma, P. (2024, December 23). Amid Arizona's data center boom, many Native Americans live without power. The Washington Post.

References

Arizona Public Service. (2024, February 23). ACC approved APS rate change to maintain reliable, resilient energy.

Chow, A. R. (2024, June 12). How AI is fueling a boom in data centers and energy demand. TIME.

Clark, K. (2023, June 22). Arizona regulators green light revised natural gas-fired plant expansion. Power Engineering.

Griffith, T. (2022, August 17). A year after deadly explosion, study warns of danger from gas lines. Coolidge Examiner.

Lakhani, N. (2023, March 20). 'They keep coming back': A Black community in Arizona battles power expansion plans again. The Guardian.

New Mexico Political Report. (2024, February 26). Arizona regulators reject proposal to assist Navajo communities impacted by coal-fired power generation.

Obando, S. (2024, September 13). Phoenix GC breaks ground on $70M data center in Mesa, Arizona. Construction Dive.

Verma, P. (2024, December 23). Amid Arizona's data center boom, many Native Americans live without power. The Washington Post.

Walton, R. (2023, June 22). In a reversal, Arizona regulators approve 575-MW Salt River Project gas plant expansion. Utility Dive.

Map: Abandoned uranium mines and the Navajo Nation, page 1 detail. U.S. Environmental Protection Agency / Public domain, via Wikimedia Commons