Phoenix, Arizona is a major competing market for data center development in the Southwest region, drawing some prospective Texas data center projects due to lower power costs and available land.
Referenced in 5 briefingsLast referenced: April 2, 2026
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April 2, 2026
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West Texas Becomes the AI Corridor While the Rest of America Waits
Arizona's datacenter cluster offers reassuring data: despite nearly 200 facilities operating or planned, industrial water usage in the Phoenix metro remains flat.
A 2025 Ceres analysis found Phoenix-area datacenter water use at 385 million gallons annually, representing less than 0.5% of regional total consumption, with agriculture consuming over 70% statewide.
Phoenix Mayor Kate Gallego warning that approving every requesting facility would spike electricity demand to 19,000 MW, more than double Arizona's grid record peak.