Is Electric Grid Reliability Becoming a Bigger Issue in Arizona?
Arizona has, historically, had one of the most reliable electric grids in the country. In 2024, we ranked 7th for electric grid reliability, even with record-breaking heat.
The grid, however, is under new pressure. The explosion of data centers, rising EV adoption, and extreme heat are all weighing on the grid and putting its long-held reliability at risk.
We’re not saying the grid is about to fail tomorrow. It has a stable foundation, and major utilities like APS and SRP are taking action to improve reliability as it falters. But the warning signs are there, and if you aren’t a fan of long-term power outages, they’re worth paying attention to.
What’s Driving the Growing Pressure?
There are three key factors putting pressure on the Arizona electric grid right now:
1. Data Centers & Crypto Mining
Data centers, which power AI operations and crypto mining facilities, have an insatiable appetite for electricity. The International Energy Agency projects that electricity demand from data centers is on track to more than double by 2030.
The increased demand affects everyone, but it hits hardest in areas where there’s a lot of data center and crypto mining activity.
That’s bad news for Arizona, which has become something of a data center hub over the past few years. Right now, there are 164 data centers in Arizona, with more under construction. The rapid growth of large loads like these will lead to infrastructure issues that could cause reliability problems if not properly managed.
2. Extreme Heat
It’s no secret that summers are getting hotter. In 2024, Phoenix experienced its hottest summer ever recorded, according to the National Weather Service. That means everyone is cranking up the AC.
Your air conditioner isn’t sucking up anywhere near as much power as a data center, but when you have millions of air conditioners running across the state, the load adds up.
As temperatures continue to rise due to climate change, which the Environmental Protection Agency expects, AC use is only going to increase. That means more stress on the electric grid and increased risk of power outages, especially during heat waves.
3. Hydropower Decline
Hydropower generation, particularly from the Hoover Dam and the Glen Canyon Dam, accounts for 4% of electricity generation in Arizona. They’re part of the reason Arizona has had such a stable grid for so long.
But the Colorado River Basin is drying up, and hydropower generation is at risk.
According to the Bureau of Reclamation, the federal agency that manages the basin’s large dams, if Lake Mead falls another 20 feet, Hoover Dam’s capacity to generate electricity would drop by 70%.
It might not seem like much in the grand scheme of things, but losing 4% of our power-generating capacity at a time when demand is rising rapidly could be devastating to grid reliability.
What This Means for Homeowners
So, the big question is—what does this actually mean for you? Grid reliability can lead to serious problems that affect every person in the state, including:
- More Power Outages – The number one threat of an unreliable electric grid is power outages. If the grid can’t support the load put on it, blackouts will happen.
- Higher Electricity Costs – Utilities need to make infrastructure improvements to protect grid reliability. The cost of those improvements often gets passed on to residential customers through rate increases.
- Shaky Peace of Mind – We’ve never really had to worry about grid reliability in Arizona, but if things continue to progress the way they are right now, we’re going to have to.
What Can You Do?
You don’t have to panic about electric grid changes causing catastrophic reliability issues right now. The grid is currently stable, and utilities are implementing plans to keep it that way (although those plans will likely come with electricity rate hikes for consumers).
But it’s smart to prepare. Even if outages remain rare, energy independence and energy cost stability are becoming more valuable every year.
Solar panels with battery storage are the solution. With solar plus storage, you won’t be at the mercy of the electric grid. If power goes out, you can keep things running with your own energy. Plus, you’ll save money on your electric bills every month and avoid rising rates. It’s one of the smartest and safest investments you can make right now, as electricity rates climb and grid stability wavers.
If you want to see how it could work for your home, reach out to SouthFace Solar & Electric for a free consultation. We’re an independent and locally owned solar company that’s been in business since 2008.
