According to The Wall Street Journal, Arizona Public Service (APS), the largest utility in the state, has proposed a roughly 14.5% increase in electricity rates for household users. In addition, APS has proposed a 45% electricity rate increase for “extra-large energy users,” which primarily consist of data centers. The situation is making nearly everyone unhappy in one of the nation’s largest data center markets, which boasts approximately 180 facilities. Arizona’s largest utility is proposing a 45% electricity-rate increase for data centers and a 14.5% hike for households. No one is happy. https://t.co/MCZ7OJUG6L — The Wall Street Journal (@WSJ) June 4, 2026 More from The Wall Street Journal: Consumer advocates warn the plan would shift the financial risks of the AI build-out to households already struggling with high summer electricity bills and temperatures that often hit triple digits. If the AI boom fizzles or the energy consumption of data centers wanes, they worry residents could be left paying off the infrastructure upgrades years from now. Microsoft, which operates three big data centers in Phoenix’s West Valley, says it is paying its own way for needed upgrades to the grid—but contends the utility has a flawed approach to paying for new generation. APS says its plan would ensure “growth pays for growth.” “We’re making sure that they are paying their fair share,” said Ted Geisler, chief executive of APS and parent company Pinnacle West Capital. “These data centers require entire power plants to be built just for them or entire transmission lines. That’s why we’ve got to modernize the rate tariffs.” The debate is part of a national tug of war. Similar fights over how to pay for the grid build-out have erupted in Texas, North Carolina and other markets, where residential power customers face large increase proposals. The stakes are high. Electricity prices are rising faster than inflation and have become a bipartisan political issue. Residential customers across the U.S. saw their electricity rates climb 32% on average between 2020 and 2025. In Arizona, the jump was 26%. “Having households subsidize data centers should be a complete non-starter in every state and locality in America,” Florida Gov. Ron DeSantis commented. Having households subsidize data centers should be a complete non-starter in every state and locality in America. https://t.co/kcYNTV1IGo — Ron DeSantis (@RonDeSantis) June 5, 2026 “An electricity hike on households because of data centers is just a h*** no. In any state,” Rep. Chip Roy (R-TX) said. An electricity hike on households because of data centers is just a hell no. In any state. https://t.co/2O3F5cRjyZ — Chip Roy (@chiproytx) June 6, 2026 “This is occurring exactly at the time Big Tech influencers look us in the eye and say there is a mythical pledge to not pass on costs to consumers. Oh, and anyone who complains about this wants China to win!” The Blaze senior editor Daniel Horowitz said. This is occurring exactly at the time Big Tech influencers look us in the eye and say there is a mythical pledge to not pass on costs to consumers. Oh, and anyone who complains about this wants China to win! https://t.co/ZpFAI2KAfg — Daniel Horowitz (@RMConservative) June 5, 2026 Sedona Red Rock News shared further: In December 2024, the ACC approved a policy statement that would allow utilities to request annual rate increases through a formula rate mechanism and would require a full rate case to come before the commission every five years. The Residential Utility Consumer Office, a state agency that advocates for ratepayers, sued to block the formula rates in Maricopa County Superior Court, but the court threw out the case on June 13, 2025. RUCO appealed, and the Arizona Court of Appeals ruled in November that the ACC couldn’t approve the policy as a minor internal change, rather the ACC may have been required to hold public hearings before adopting it. The ACC then appealed to the Arizona Supreme Court, which sent the case back to the Maricopa County Superior Court. “We’re proposing to use formula rates in the future, to make rate adjustments, either up or down, based on the previous year’s expenses and investments,” APS wrote. The formula-rate policy isn’t the only part of APS’s request drawing opposition. “APS is asking Arizona families to foot the bill for shareholder profits that far exceed what any reasonable investor requires,” Attorney General Kris Mayes [D] wrote in a March 3 press release, announcing her office had filed testimony with the ACC. “This is just corporate greed run amok. Our expert analysis proves that customers are being asked to pay far more than is needed. Instead of a 14% rate hike, the expert testimony we just filed with the ACC shows that APS can achieve the same reliability with just a 3% increase by aligning what customers pay with APS’s actual costs.” The commission previously approved 8% APS price increases in both 2023 and 2024. APS’ parent company, Pinnacle West, posted $600 million in profits in 2025, a market cap approaching $12.5 billion. Watch more below: