Project Energy

Energy has emerged as the defining opportunity—and constraint—facing Arizona at this moment in its growth trajectory. Demand from population expansion, advanced manufacturing, AI and data centers, mining, transportation electrification, and water augmentation is accelerating faster than the state’s ability to generate and deliver power. This imbalance presents a clear economic opportunity: Arizona can either lead by building the next generation of energy infrastructure or risk losing investment, jobs, and competitiveness to states that act more decisively. Energy is no longer a background utility function; it is the primary driver of economic development, and addressing it now will determine the state’s long-term prosperity.

In the near term, Arizona has the opportunity to stabilize and strengthen reliability through pragmatic actions that protect consumers while supporting growth. Expanding natural gas supply, including increased access from Texas, extending the life of select legacy assets where reliability is critical, deploying grid-scale battery storage, and implementing advanced pricing models for large power users can provide immediate relief. These measures can bridge the gap while longer-term solutions are developed, ensuring that economic expansion does not stall due to power shortages or cost volatility.

Beyond generation, one of the greatest opportunities lies in modernizing and expanding Arizona’s transmission and distribution infrastructure. Power lines have become a major bottleneck, limiting the ability to connect new energy projects to the grid and delaying development for years or even decades. Strategic investment in transmission corridors, streamlined permitting, and regional coordination would unlock stranded generation capacity and enable both centralized and decentralized power solutions to scale. Addressing this challenge positions Arizona as a hub for energy-intensive industries that require certainty, speed, and reliability.

Looking to the medium term, Arizona is uniquely positioned to lead in next-generation energy technologies, particularly small modular nuclear reactors (SMRs). Building on the success and public confidence established by the Palo Verde Nuclear Generating Station, SMRs offer a flexible, reliable, and scalable source of clean baseload power. These systems can serve industrial campuses, data centers, mining operations, water infrastructure, or feed directly into the grid, creating a powerful competitive advantage. Combined with continued growth in solar, wind, and distributed generation, this diversified approach reduces risk while maximizing resilience.

The opportunity before Arizona is to create and execute a unified 25-year energy strategy that aligns power generation, transmission, regulation, and economic development under a single, transparent vision. Organizations such as the Canada Arizona Business Council recognize that abundant, dependable energy underpins every major sector of the economy, from manufacturing and agriculture to transportation, tourism, and foreign direct investment. By acting now—through collaboration between government, utilities, private capital, and innovators—Arizona can secure its energy future, attract global investment, and ensure that its growth over the next 50 years is not limited by decisions deferred today.

To see a list of goals for this initiative, click here.