Arizona AG Challenges APS’s Proposed 14% Rate Hike Amid Data Center Debate

Arizona Public Service Faces Opposition Over Proposed Electricity Rate Hike

The Arizona Public Service Company (APS) is seeking approval for a significant electricity rate increase of nearly 14%. The proposal, if sanctioned by the Arizona Corporation Commission, may be implemented later this year. However, this has sparked debate, with Attorney General Kris Mayes suggesting a more modest 3% hike could still ensure service reliability.

Mayes argues that the current plan unfairly burdens residential customers, making them shoulder the costs for the rising energy demands of new data centers. In contrast, APS maintains that their proposal would impose higher charges on substantial energy consumers like data centers, while providing relief for families and small businesses.

In a conversation with KNAU’s Adrian Skabelund outside the Prescott Valley Public Library, Mayes shared insights from discussions with ratepayers across Arizona.

ADRIAN SKABELUND: What feedback are you receiving from ratepayers regarding the proposed rate increase?

KRIS MAYES: I’m hearing that people are struggling. A 15% increase, following three previous hikes, could force many into difficult positions, choosing between essentials like medication and electricity bills. This increase seems driven by data centers that billionaires wish to build, imposing an unfair financial burden on ordinary Arizonans.

Mayes emphasizes that a 3% increase, as proposed by her office, represents a massive difference compared to the 14% APS suggests. She believes the higher rate would result in an undue wealth transfer from average Arizonans to the utility giant.

APS contends that part of their proposed increase would fund safety investments, such as wildfire management. However, Mayes rebuffs this justification, pointing out the utility’s substantial annual profits. “Investing in wildfire management is a core responsibility,” she states, questioning the necessity of a rate increase for this purpose.

Data centers are primarily being constructed in metro-Phoenix areas, which Mayes cites as another layer of unfairness. She explains that many ratepayers in rural Arizona are subsidizing these developments without benefiting from the jobs or infrastructure.

SKABELUND: Thank you for sharing your insights, Attorney General.

MAYES: Thank you. It’s a pleasure to be here.

This interview has been condensed for clarity.