- Arizona, first in nation to outlaw city-level bans on specific energy types, embraces natural gas, solar and all energy to fuel economy
- States with restrictive energy policies losing investment race while those like Arizona thrive
PHOENIX – Arizona’s surging economic and population growth, which includes more than $65 billion in AI, technology and advanced manufacturing investments and a projected population increase of as much as 48% by 2050— will depend on reliable natural gas infrastructure to keep the state’s energy affordable and reliable, a new report from Consumer Energy Alliance (CEA) finds.
The report, “Powering Arizona’s Future” finds that Arizona’s growth-focused energy policies, which provide certainty to investors and affordability to consumers, has helped the Grand Canyon State attract more than $65 billion in technology and advanced manufacturing investments. Already, natural gas provides nearly half of Arizona’s electricity generation and is a key driver behind the state’s ranking as having the nation’s most affordable natural gas and second-lowest overall energy costs.
As Arizona’s electricity demand is projected to grow by more than 40% by 2031—driven by AI data centers, advanced manufacturing, and population growth—natural gas continues to provide the reliable baseload power needed during periods of high demand. Phoenix ranks 4th among U.S. data center markets, with companies choosing Arizona specifically for its energy reliability and competitive costs.
“Arizona’s surging economy is fueled by the foresight of the state to prioritize affordable, reliable energy when formulating policies designed to provide decades of growth,” CEA Southwest Executive Director Matthew Gonzales said. “Technology companies are investing billions here because they know Arizona can deliver the affordable, reliable energy they need to make long-term investments. Arizona has embraced natural gas, solar and all forms of energy to serve what should be the ultimate goal of any state: prosperity and affordability for its citizens.”
Arizona’s 2020 fuel choice law was the first in the nation to prevent local governments from banning natural gas, and 26 states have since followed suit. The report shows how this foresight was critical. Had municipalities been allowed to impose natural gas bans like those attempted in California, Arizona families would have faced retrofitting costs of nearly $21,000 per household. Households relying on electric heating already spend about 75% more during winter than those using natural gas.
“Arizona has acted in a way that demonstrates it understands just how critical affordable, reliable energy is to everyone – from companies that choose to invest in Arizona to every single resident,” Gonzales said. “The states which recognize this fundamental truth will win for their citizens, and beat out those states which continue to move blindly ahead with restrictive energy policies that do the opposite.”
Arizona is moving forward with critical infrastructure projects to meet future demand, including the massive Transwestern pipeline expansion, known as the Desert Southwest Pipeline, that will bring additional natural gas supply from the Permian Basin by 2029. The project is essential for meeting the growing demands of hospitals, schools, and data centers while maintaining reliable, affordable energy for Arizonans.
The report also highlights how natural gas supports energy equity across Arizona’s diverse communities. In Phoenix alone, 26% of Black households and 25% of Hispanic households face high energy burdens, spending more than four times the median percentage of income on energy bills.
Read the full report here.
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About Consumer Energy Alliance
Consumer Energy Alliance (CEA) is the trusted voice advocating for affordable, reliable, and cleaner energy solutions that benefit all Americans. Representing families, farmers, small businesses, distributors, producers, and manufacturers, CEA champions sensible, balanced policies that support economic growth and environmental resiliency; and ensures families and businesses are a vocal part of the nation’s energy dialogue. Every day, we work to inspire practical, responsible solutions that meet America’s energy needs while protecting the environment for generations to come.
Contact:
Bryson Hull
(202) 657-2855
bhull@consumerenergyalliance.org