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🇺🇸 Desert Southwest (Phoenix) · PGIQ Tier 2 Strong
As of June 2026 · powergridiq.com/rating/desert-southwest
PGIQ Rating v2 (reliability-adjusted) · as of June 2026
2

🇺🇸 Desert Southwest (Phoenix)

Strong, with known trade-offs, and the path is improving Minor flags found
Tier 2 Strong · Composite 69/100, #8 of 79 markets (fundamentals 72 minus a reliability dock) · Outlook Positive · Med-High confidence · how we score

One of the fastest-growing US markets, on abundant land, strong solar and a pro-build posture. Phoenix overtook Dallas and Silicon Valley on inventory in 2025. The clearest US momentum riser after Texas.

See live grid data →
One market,
four reads
BuildTier 2Siting ratingSellGrade AOfftakePlanRisingLoad pressureMonitorSoundGrid strength
The same market, four decisions. Open any lens to see this market ranked against the rest.
Time to energize · file to power
~55 mo
File a large load today, powered ~2031. Typical range 38 to 72 months, modelled.
End-to-end wait for a large new load, from a complete application being accepted to full firm energization of the nominated MW. Earlier milestones (initial, phased, temporary or conditional energization) are reported separately. A typical case, not a firm quote. · Source: LBNL Queued Up 2026 · Compare markets →
The same market, read four ways

Desert Southwest (Phoenix) is a strong market to sell power into

Grade A (Strong)
Offtake score 81/100
Demand 45, build feasibility 68, combined into the score. For a seller: where buyers already pay, how tight supply is, and how feasible new build is here.
Price to beat
A 100 MW load on our standard case pays about $90/MWh delivered here. A competitive supply offer works against that level.
Queue depth (generation and storage)
About 95 GW in the interconnection queue (the line to connect to the grid), typical wait 55 months.
See it on the Offtake Grade →

Desert Southwest (Phoenix): some room at system level, rising demand pressure

Some room 67/100
System-level room, not local capacity
Local capacity: not assessed. We have found no operator publication of area or substation capacity for this market, so whether the bus serving a candidate site can take the load is an open question. Absence of a finding here is not evidence that capacity exists.
Two reads for a grid planner: how much room the system as a whole looks to have (Some room), and how hard demand is already pushing (Rising). The first is a market-level estimate from connection ease, forward adequacy and reliability margin. It is not local deliverability. Capacity at a specific substation is not assessed for this market, and a market can look roomy while the bus you want has nothing available. Confirm local capacity with the utility before relying on it.
Generation and storage queue
95 GW requested; about 23.8 GW likely to reach operation after historical withdrawal. The gap is speculative pipeline. This counts generation and storage seeking to connect, not load.
Demand growth
Fast load growth in our read, the pull on your system.
Future firm supply
Future firm supply: adequacy flagged for a large new load.
Load Pipeline Reality → Where demand is hungry → Connection friction →

Grid Risk Annex BETA

Sound
Manageable with normal diligence · grid strength 56/100
A cited, dated grid-risk read on Desert Southwest (Phoenix) for a capital provider, the banks and private-credit lenders, infrastructure funds and insurers holding or underwriting a power or data-centre exposure here. Drop it into a credit memo and watch each factor over the life of the exposure.
Read it against your asset. For a load asset (Buy), weight connection access and energization timing. For a generation or offtake asset (Sell), weight offtake demand, curtailment (when a plant is told to stop feeding the grid) and cost realisation. For a grid or transmission asset (Move), weight load-pipeline reality and buildout risk.
Rating and track record
PGIQ Tier 2 Strong, outlook Positive, Med-High confidence. Scored on a public, dated, falsifiable record you can cite in a credit memo.
Delivery reliability
Minor flags found in the bulk and local outage record we reviewed.
Future firm supply
Future firm supply: adequacy flagged.
Cost certainty
Recurring cost about $90/MWh (band $75 to $110) for the standard 100 MW case, basis modelled. Excludes connection capital.
Regulatory / stroke-of-pen
Not assessed.
Execution risk
95 GW in the generation and storage queue, about 75% historically withdrawn, the risk the project or load actually energizes on time.
Ongoing monitor
Track this market's rating actions and the Global Power Index as a covenant-style monitor over the life of the exposure.
Monitoring plan
Covenant-style triggers to watch over the life of the exposure: a change in the PGIQ rating or outlook; a dated regulatory move (stroke-of-pen risk); a capacity-auction or cost-band shift; a forward firm-supply adequacy warning; and a rise in queue drop-out or connection friction. Track them on this market page and the Global Power Index, or as Analyst Desk alerts.
Sources: North American data-center records, CBRE
This is a directional grid-risk screen, not a credit rating, and not investment, engineering or procurement advice.
The formatted, cited Grid Risk Annex export is an Analyst Desk feature.See the Grid Exposure Monitor →

The five pillars behind the tier

A
A
C
M
C
The pillar signature: Access, Availability, Cost, Momentum, Carbon, taller is stronger. The same shape repeats across every market so peers compare at a glance.
Access30%68

Moderate, improving access: Arizona utilities are accommodating large load and building fast.

Availability25%62

Moderate availability: solar plus gas, with batteries increasingly covering the evening peak.

Cost25%80

Low-to-mid cost.

Momentum15%85

Very high momentum: a top inventory-growth market with a deep pipeline.

Carbon5%70

Carbon moderate (~200 g), solar-heavy by day.

Default weights, which lean toward cost and access rather than carbon: Access 30 · Availability 25 · Cost 25 · Momentum 15 · Carbon 5. Momentum reflects the data-center build already underway, not just stated intentions.
Seller view: Read these the other way: momentum is your customer pipeline, cost is your revenue ceiling, and access is how hard it is to build and sell here, not only to connect.

Reliability overlay

Reliability adjustment: the five-pillar score of 72 is reduced to 69, a deduction of 3 points, reflecting the delivery-reliability and firm-supply risks flagged below. Reliability is reported as five separate layers, never as one combined label, because they answer different questions and a strong answer on one does not cover a gap in another: what has actually failed on the bulk system, what a forward assessment expects of firm supply, how the local network performs, what your contract actually promises, and what your site is designed to ride through. Any one of them can cap the tier.

Historical bulk-system performance: No reliability flags found

Historical utility-territory delivery performance: No reliability flags found

Average customer interruption (SAIDI) of 67.88 minutes per year in 2024, excluding major event days as filed.

measured · EIA Form 861, Schedules 3B and 3C (annual electric power industry report) (IEEE 1366 major-event treatment, customer-weighted blend of 4 utilities, regional context only)

Role not yet declared. We have not recorded whether this is one operator’s filing or an average across several, so read it as context until we do. major event days identified by IEEE 1366 (2.5-beta method). It is a territory-wide history and is silent on: performance at a specific substation or feeder; transmission-level service, which is a different product from distribution service; the industrial or large-load customer class specifically; N-1 or other redundancy architecture at the supplying substation; contractual curtailment rights the utility may hold over the load; power quality and momentary interruptions, which this metric excludes by construction; on-site UPS, storage or generation; forward adequacy: it is a record of what happened, not a forecast.

Which utility would serve you?

The market figure above is an average across these territories. Your site sits in one of them, not in the average. Each row below is that utility’s own filed record, which is the evidence a Project Case can actually rest on.

Serving utilitySAIDI min/yrCustomersMajor-event method
Arizona Public Service Co (AZ)80.861,395,614IEEE 1366
Salt River Project (AZ)52.811,161,925IEEE 1366
Tucson Electric Power Co (AZ)68.36455,579IEEE 1366
UNS Electric, Inc (AZ)60.13106,739IEEE 1366

Filed to EIA Form 861 for 2024, excluding major event days. Territory-wide averages: see the layer note above for what they do not establish.

Forward resource adequacy (assessed): Adequacy flagged

Phoenix and the desert Southwest face extreme summer cooling peaks that strain supply; utilities have managed them so far, but heat-driven peak stress is the standing forward risk.

What this means: A large new load faces occasional exposure here. Monitor conditions and keep a contingency plan.

modelled

Contractual service terms: not assessed

We have not compiled what firm service actually promises here: whether it is firm, non-firm or interruptible, the conditions under which you can be curtailed, the redundancy required of you, and the transfer time behind any N-1 commitment. Treat this as an open diligence item, not as an indication that service is firm.

Ask the utility for the tariff or service agreement terms before relying on firm supply.

Designed site resilience: not applicable at market level

Utility feeds, UPS, storage, on-site generation, islanding, black start and the residual energy you still expect to lose are properties of a specific site design, not of a market. This layer only exists once there is a site, and we never assert it for you.

Confidence: Med. Each input is labelled as measured, modelled, or drawn from a specific event, and is framed as a risk to a prospective large new load, not as a verdict on any utility or grid operator. Forward adequacy is an assessment of what is expected, not a measurement of what has happened; it is a forecast and is labelled as one.
Seller view: Tight forward capacity (firm supply promised for future years) is scarcity that firm generation and storage get paid for; an adequacy flag is a demand signal for new supply, not only a risk to a load.

Supply relief outlook

Will the power crunch ease before your load energizes? This nets the demand racing for capacity against the new supply likely to arrive and the old supply leaving. A cross-side read, using the same data a seller sees the other way.
Balanced
Demand pressure
Fast load growth competing for the same capacity.
New supply in motion
About 23.8 GW of the generation and storage queue is likely to reach operation after historical withdrawal.
Future firm supply
Future firm supply: adequacy flagged.

What this means: Supply and demand look broadly balanced; the outcome hinges on the drivers below.

Reliability metrics

Delivery reliability (measured)

The average customer loses about 67.88 minutes of power per year (2024). This is the standard regulator outage measure (SAIDI); lower means a more reliable grid.

Source: EIA Form 861, Schedules 3B and 3C (annual electric power industry report) (IEEE 1366 major-event treatment, customer-weighted blend of 4 utilities, regional context only)

Hard, cited measures behind the reliability overlay above: the regulator outage series (SAIDI, measured, published with a lag) and the forward resource-adequacy assessment (a measured forecast). Framed as risk to a prospective large new load, not a verdict on any utility.

Interconnection queue

These are generation and storage interconnection queues. They show how congested the interconnection system is. They do not measure how long a new large load waits, and their withdrawal rates are not load withdrawal rates. At the end of 2025, generation and storage projects totalling about 2,060 GW were actively waiting in United States queues, down 10% from a year earlier. Of the capacity that entered between 2000 and 2020, about 75% withdrew before connecting and only about 13% reached operation by end-2025. The typical project built in 2025 waited about 61 months from request to operation (Lawrence Berkeley National Laboratory, Queued Up 2026). Figures below are refreshed quarterly; each is labelled measured or modelled.

Active queue depth

95 GW

Typical wait

55 months

The full queue analysis for this market, which covers the share of projects that give up and leave the queue (the withdrawal rate), how much of the queue is data centers, and the sources, is available through /api/v1/queue/desert-southwest with a paid key. These are generation and storage queue figures: they show interconnection-system congestion, not a typical large-load connection wait.

Seller view: A deep queue is both your own time-to-revenue and a moat against competing supply; what matters is the effective supply likely to complete after withdrawal, not the headline queue.

Realized cost band

What a large electricity user pays for power here on one declared case, 100 MW contracted demand, 95% load factor, HV service, per megawatt-hour. Not the wholesale price and not the sticker tariff: energy plus the grid, delivery and other charges that land on the bill. It is a range, because real contracts vary, and it is labelled by how it was built.

Recurring cost, delivered

$75 to $110 per MWh

Midpoint about $90 per MWh

How this band was built

modelled

From 3 public fragments

What sets this band

There is no wholesale spot market here, so the band is not an energy-plus-network stack. It is set by the regulated tariff levels below.
$90
$75$110
Regulated large-load rate (APS / SRP, bundled)$90 /MWh
Arizona is served by vertically integrated utilities (APS and SRP) at regulated bundled rates, not a wholesale market. APS has proposed a separate extra-large-load class with increases of roughly 30 to 45 percent, and SRP's E-67 plan applies minimum-demand billing to loads of 20 MW or more.
These are the regulated tariff levels that define the band, not an additive cost stack. The band reflects the regulated industrial rate plus the emerging data-center-specific premium; it is a tariff set in rate cases, not a spot price. Anchored to published figures (Arizona Corporation Commission large-load workshop (2026)).

Where the cost lands

$90
Low $75Midpoint $90High $110
A band, not a single price: the cheaper end is a well-structured contract on favourable terms, the higher end a less optimised one. The midpoint is our best central read.
What is in the number: A regulated bundled large-load rate set through Arizona Corporation Commission rate cases (APS) or by SRP's board, with a new data-center rate class lifting the top of the band.

Phoenix is one of the largest US data-center markets, but Arizona utilities are actively repricing large loads: APS has proposed a separate extra-large class with increases around 30 to 45 percent, and SRP's E-67 plan imposes minimum-demand billing on 20 MW-plus loads. A new large load should underwrite the upper half of the band, not the historical industrial average.

This market's band is free here; the ranked cross-market table with every market's precise midpoint is the Analyst Desk. See the ranked view.

Basis: triangulated from public sources, in US dollars per MWh delivered to a large high-load-factor load, excluding refundable taxes. Sources: Arizona industrial electricity price (EIA) · APS data-center rate protections · SRP data centers and E-67.

Seller view: This delivered price is the level a competitive supply offer must beat, and the revenue ceiling a merchant plant works against here.

Data provenance and freshness

What we hold for this market, field by field. Each tier below is assigned from the evidence actually held for that field, with provenance. A low tier means we looked and it is thin; it is not a verdict on the market.
cost: M1connection: M1reliability: M2carbon: M2regulatory: not_assessedlocal capacity: not_assessed
Against a Standardized Project Case, the binding field is cost, connection, reliability. That is what a standardized case would turn on here; a readiness result for your own project depends on your own requirements, siting and utility, which this market-level read does not know.
Read against other uses: Discovery and monitoring: M1 · Market comparison: M1 · Project Case with a carbon requirement: M1 · Conditional site diligence: insufficient.
Depth is not a rating strength, a confidence score or a feasibility conclusion. An aggregate is only ever shown for a named use case, and equals the lowest tier across that use case's required fields. Definitions v1.0. See the full coverage matrix.
How solid the data behind this rating is, on two separate axes plus recency. Source reliability is how measured the numbers are, as opposed to triangulated or modelled. Coverage is how many of the decision-relevant data dimensions (reliability, connection, and cost) are compiled for this market. The two are kept apart because they answer different questions: a market can have strong sources on the little that is covered, or broad coverage that still leans on models. Neither grades the rating itself. The rating is a cited opinion, graded separately and falsifiably by the public track record and baseline measurement plan.

Source reliability

Limited

1 of 3 data layers measured

Coverage

Full

3 of 3 dimensions: reliability, connection, cost

Last reviewed

June 2026

per-layer vintages below

LayerMethodVintageFreshnessSource
PGIQ Rating opinionopinionJune 2026CurrentPGIQ methodology
Reliabilitymeasured2024FreshEIA Form 861, Schedules 3B and 3C (annual electric power industry report) (IEEE 1366 major-event treatment, customer-weighted blend of 4 utilities, regional context only)
Interconnection queuemodelledend-2025 (LBNL 2026)FreshLBNL Queued Up 2026
Realized costmodelled2026FreshArizona industrial electricity price (EIA)

Freshness reflects each layer's refresh cadence: reliability annual to three-yearly, capacity-auction and queue yearly, tariffs every year or two. The full cross-market freshness dashboard is at /data-quality.

What this market can and cannot answer yet

No market-level read closes a project case on its own, and saying only that would waste the evidence we do hold. Below is what is established, what is open, and what to do next.

What is established

  • Recurring cost band $75 to $110 per MWh, midpoint $90, basis modelled, against the 100 MW archetype
  • Historical utility-territory delivery performance 67.88 minutes per year (2024)
  • Forward resource adequacy (assessed)
  • Typical interconnection wait about 55 months (generation and storage queue, not a load wait)

What is open

  • Historical bulk-system performance
  • Contractual service terms (would change the answer)
  • Designed site resilience
  • regulatory evidence
  • local_capacity evidence

Who would actually serve you

Territories in this market, each with its own filed record: Arizona Public Service Co, Salt River Project, Tucson Electric Power Co, UNS Electric, Inc. Which one serves a given site depends on where that site is.
Who runs the connection process: not yet compiled for this market. This is wayfinding rather than evidence, and its absence is a gap in our compilation, not a fact about the market.

Credible ranges today

  • Cost $75 to $110 per MWh, midpoint $90 (modelled)
  • Schedule: interconnection queues here run about 55 months for generation and storage; a large load follows a different process and we do not hold its measured distribution

What could disqualify this market

  • Summer extreme heat and cooling-peak reliability.
  • Water availability for cooling.

Five questions for the utility or system operator

  1. What is the available capacity at the bulk supply point and substation that would serve this site, and what would a 100 MW request do to it?
  2. Is firm service available at 100 MW, and what curtailment rights would you retain over us once we are energised?
  3. What are the milestone dates from a complete application to full firm energisation, and which network upgrades would a 100 MW load trigger?
  4. What is the all-in delivered rate for 100 MW at a 95% load factor, including demand, network and rider charges, under the tariff that would actually apply?
  5. What is your own territory's SAIDI and SAIFI for the industrial class, on which major-event standard, and what redundancy serves the candidate substation?

Documents that would advance the case

  • The area or substation capacity study, and the current queue position list.
  • The applicable large-load tariff or the draft electric service agreement.
  • The interconnection or system impact study, and a specimen connection offer.
  • The current tariff sheet with all riders, and any large-load contract terms.
  • The utility's own reliability filing and the substation single-line diagram.

Outlook drivers

↑ Upgrade triggers

  • Continued solar-plus-storage build lowers carbon and firms the peak.
  • Sustained absorption converts the pipeline.

↓ Downgrade triggers

  • Water and extreme-heat constraints.
  • Transmission limits slow new connections.

Key risks

Peer comparison

Trades like
Atlanta (fast-building, mid-cost)
Ahead
on momentum
Behind
ERCOT on openness

Evidence behind this rating

The real-world events that test our Tier 2 call for Desert Southwest (Phoenix): 1 supports it. Each is dated and cited, so you can check the rating against what is actually happening on the ground.

Phoenix overtakes Dallas and Silicon Valley on inventory ✓ Supports the rating
2025MomentumMateriality: low

The Desert Southwest is now one of the fastest-growing US data-center markets on land, solar and a pro-build posture.

Source: CBRE ↗
Cited, dated developments tagged to the pillar they bear on, and whether they support or challenge the current tier. A material item flags the market for analyst review and may drive a rating action.
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Rating history

June 2026
New ratingNew rating: Tier 2 Strong assigned.
🔒 The full time series behind Desert Southwest (Phoenix), how its score, recurring cost, and interconnection queue have moved month by month, is part of the Analyst Desk. The rating actions above are always free.
Every rating action is dated and explained, and the log is only ever added to, never edited. Reviews happen on a regular schedule and whenever a significant event occurs. "Affirmed" means we reviewed a development and the tier held; "Under review" means a significant item is being assessed and the rating could change.

Score history

How Desert Southwest (Phoenix)'s reliability-adjusted score and tier have moved, month by month. Part of your Analyst Desk.

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How does Desert Southwest (Phoenix) compare to the other 78 markets?

This page is our full read on Desert Southwest (Phoenix) alone, and it is free. To decide where a large load should actually go, you need every market side by side, ranked on recurring cost and time-to-connect, with the history and alerts when your shortlist moves. That is the Analyst Desk.

With your Analyst Desk, compare Desert Southwest (Phoenix) against every market side by side, ranked on recurring cost and time-to-connect, with the full history and shortlist alerts.

+ Add to your shortlist Recurring cost, ranked Connection friction, ranked Get the Analyst Desk →
Cite as: PowerGridIQ Rating, "Desert Southwest (Phoenix)" (Tier 2 Strong), as of June 2026. A proprietary, directional screen for siting a large electricity load; not a connection guarantee, and not investment, engineering or procurement advice. Sources and methodology at powergridiq.com/methodology. © PowerGridIQ.