The Arizona Â鶹´«Ã½Ó³»­ of Commerce & Industry and Arizona Manufacturers Council have opened nominations for two statewide competitions recognizing standout products, companies, and leaders across Arizona’s manufacturing sector.

The fourth annual competition, , invites manufacturers of all sizes to nominate products made in the state. Eligible entries can come from global companies, small businesses, artisan producers and independent makers.

Competition winners will be announced at an as part of the Arizona Manufacturers Council’s Manufacturing Month programming.

“Â鶹´«Ã½Ó³»­anufacturers are building everything from advanced aerospace and defense systems to semiconductors, lifesaving medical devices and everyday products that shape how we live and work,â€� said Grace Appelbe, executive director of the Arizona Manufacturers Council. “This competition is our chance to show people just how much is being made here, recognize the skilled teams behind those products and have a little fun deciding which one deserves the title of Hottest Thing Made in Arizona.â€�

The competition returns as Arizona continues to attract major manufacturing investment and international attention.

recently announced an additional $100 billion investment in its Phoenix operations, bringing the company’s planned Arizona investment to $265 billion. The expanded plans include six semiconductor fabrication facilities, two advanced packaging facilities and a research and development center.

Amkor Technology’s planned $7 billion advanced semiconductor packaging and testing campus in Peoria was also named the for 2025 by Site Selection magazine. The project is expected to create as many as 3,000 jobs.

Past winners of the Hottest Thing Made in Arizona competition include:

• Boeing’s AH-64 Apache helicopter in 2023
• The Dexcom G7 continuous glucose monitor in 2024
• Honeywell Aerospace’s 131-9 auxiliary power unit in 2025

Nominations are also open for the 2026 Arizona Manufacturer of the Year Awards, which recognize companies, industry leaders, and achievements in seven categories:

• Small Manufacturer of the Year
• Medium Manufacturer of the Year
• Large Manufacturer of the Year
• Excellence in Innovation
• Excellence in Sustainability
• Champion of the Year
• Arizona Success Story

“These awards recognize the companies and people translating Arizona’s manufacturing momentum into real products, high-quality jobs and stronger communities,â€� Appelbe said. “Whether they employ thousands of people or a few dozen, Â鶹´«Ã½Ó³»­anufacturers are solving difficult problems, investing in their teams and proving that our state can compete with anyone.â€�

The Hottest Thing Made in Arizona competition will include a series of public voting rounds, allowing employees, customers and communities to rally behind their favorite Arizona-made products.

Nominations can be submitted at .

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As school choice and education savings account programs continue to expand across Arizona and the U.S., state agencies face a growing operational challenge: how to administer billions of dollars in public funding while ensuring compliance, transparency, and a streamlined experience for families.

Odyssey was built to solve exactly that problem.

Rather than simply functioning as a payments processor, the technology company developed an end-to-end platform designed specifically for public education funding programs. Its technology helps state agencies manage everything from eligibility verification and document collection to vendor management, purchasing controls, reimbursements, and financial reporting all within a single system.

With Odyssey managing school choice programs in states like Texas, Florida, and Iowa, the need for technology that can handle the complexity of program administration has become increasingly important as they scale across the country. Modern programs can serve tens of thousands of families, support thousands of education providers, and process enormous volumes of applications, receipts, and transactions. Managing that complexity through spreadsheets and dated software is no longer sustainable.

That operational focus has also positioned Odyssey to become an early adopter of artificial intelligence (AI), using it as a practical tool for improving efficiency and strengthening the integrity of its program.

“Odyssey is proud to play a key role in expanding access to high quality education for families in states across the country, regardless of income or zip code,” said Sam Ratcliffe, chief technology officer at Odyssey. “We are committed to offering our best-in-class technology and AI to better serve school choice families, schools, and program administrators. When technology is built around the needs of both government and families, it expands educational opportunity while delivering the transparency and accountability that public programs require and taxpayers deserve.â€�

Unlike traditional software that relies exclusively on fixed rules, Odyssey utilizes AI to interpret large volumes of unstructured information, including receipts, invoices, product descriptions, and supporting documentation. The technology helps classify purchases, identify missing information, detect unusual transaction patterns, and prioritize cases that warrant additional human review.

Every flagged transaction is routed through structured review workflows where trained specialists review the issue to make the final determination according to state policy. This approach allows agencies to automate repetitive administrative work while preserving oversight for higher-risk decisions.

Odyssey’s platform also strengthens fraud prevention by addressing improper payments before they occur rather than solely relying on audits after funds are spent.

As Odyssey’s platform has expanded across multiple states, machine learning has become increasingly effective at distinguishing between normal program activity and behavior that calls for closer examination. Operational feedback from reviewers continually
improves case prioritization while ensuring each state’s unique policy requirements remain central to every decision.

Beyond compliance, automation has significantly improved the experience for families. Instead of waiting days or weeks for application reviews, Odyssey’s automated systems can return eligibility decisions in seconds. Families can apply, upload documents, monitor balances, purchase approved educational services and track reimbursements from a mobile device — an important feature considering that roughly 85% of users access the platform via smartphone.

For state agencies operating with limited staffing resources, those efficiencies are equally meaningful. Automation handles routine processes such as application intake, document validation, transaction routing and payment reconciliation, allowing employees to focus on complex cases, policy interpretation, investigations, and constituent support.

Ultimately, Odyssey sees AI as one component of a broader technology ecosystem designed to make education funding more efficient, transparent, and accountable. By combining automation with configurable program rules, comprehensive audit trails and human oversight, the company is helping modernize how states administer rapidly growing education choice programs while strengthening safeguards for public funds.

Photo: Lucélia Ribeiro, CC BY-SA 2.0 , via Wikimedia Commons

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Honeywell Aerospace is preparing to launch as an independent, publicly traded aerospace and defense company headquartered in Phoenix, placing the global operation of one of the industry’s largest suppliers at the center of Arizona’s growing advanced-manufacturing economy.

The company is expected to separate from Honeywell International on June 29 and begin trading on the Nasdaq stock exchange under the ticker HONA. The planned spinoff is part of a broader restructuring of Honeywell into more focused standalone businesses.

Honeywell Aerospace marked the milestone last week with its inaugural Investor Day in Phoenix, followed by an evening reception at its Sky Harbor hangar for state and local leaders. The events offered a look at the company’s strategy as an independent business, along with aircraft, engines, and other aerospace and defense technologies bearing its newly unveiled branding.

The company reported $17.4 billion in global net sales in 2025 and is one of Arizona’s largest employers, with more than 7,000 workers in the state. Honeywell Aerospace operates across commercial aviation, business aviation, defense, and space markets.

“This is a major vote of confidence in Arizona’s economy and in the people who have spent decades building our aerospace and advanced-manufacturing base,â€� Arizona Â鶹´«Ã½Ó³»­ of Commerce & Industry President and CEO Danny Seiden said. “The impact goes well beyond the thousands of high-paying jobs Honeywell supports today. A headquarters means the big decisions are made here, and that creates opportunities for investment, suppliers, small businesses, and communities across our state.â€�

Honeywell Aerospace’s portfolio includes avionics, navigation systems, sensors, aircraft engines, auxiliary power units, electric-power systems and thermal-management technologies. The company will be organized into three operating segments: Electronic Solutions, Engines & Power Systems and Control Systems.

Honeywell has deep roots in Arizona. Its aerospace operations have been based in Phoenix for decades, and the company has played a role in developing technologies used across commercial aviation, defense and space exploration.

The Phoenix headquarters designation takes on greater significance as the newly independent company lays out plans for its next phase of growth. Honeywell Aerospace told investors it expects sales to grow between 6% and 8% annually through 2030, driven by demand from commercial aviation, aftermarket services, defense and space customers. Its backlog has grown to $19 billion, up 20% from a year earlier.

CEO Jim Currier said the company plans to prioritize investments in manufacturing capacity and its supply chain as it moves forward as a standalone business.

Grace Appelbe, executive director of the Arizona Manufacturers Council, said the headquarters announcement highlights the importance of Arizona’s advanced-manufacturing sector and the skilled workforce supporting it.

“Honeywell’s presence in Arizona is a reminder that advanced manufacturing is not an abstract concept here,� Appelbe said. “It’s skilled Arizonans building technologies that power aircraft, support national defense and shape the future of flight. Anchoring that global operation in Phoenix strengthens Arizona’s broader manufacturing ecosystem and reinforces our state’s position as a hub for advanced industry.�

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Ensuring Arizona families can easily access and use Empowerment Scholarship Account (ESA) funds and count on fast approvals and timely reimbursements is the focus of an initiative announced last week by Arizona State Treasurer Kimberly Yee to improve the state’s ESA financial platform.

The Treasurer’s Office, which manages the contract with the vendor operating the ESA platform, will soon issue a formal Request for Information (RFI) to gather input from qualified vendors on system upgrades, new capabilities, and emerging technologies.

A key priority of the review is identifying modern solutions, including improved platform design, automation, and artificial intelligence-driven tools, that can both streamline the user experience for families and strengthen oversight of public funds.

“It is imperative that the State of Arizona’s ESA vendor operates effectively, provides a user‑friendly system for Arizona families and verifies that expenditures comply with Arizona law,â€� Yee said.

The ESA program, administered by the Arizona Department of Education, allows families to use public education dollars for approved expenses such as school tuition, tutoring, and educational materials. As participation has expanded rapidly, the need for a more efficient and user-friendly financial platform has grown alongside it.

Yee said the RFI will provide valuable insight into marketplace trends and technological capabilities ahead of a future Request for Proposal (RFP) for ESA financial services.

“The Arizona State Treasurer’s Office remains committed to ensuring that the marketplace vendor platform is as efficient as possible in delivering necessary funds to ESA families for qualified expenses. This process would invite ESA marketplace vendor programs to share how their innovations, including modern platform design, automation, and AI-driven tools, could strengthen Arizona’s ESA program.�

Safeguarding taxpayer dollars remains a central focus of the effort, with an emphasis on identifying systems that can quickly flag potential misuse while maintaining a smooth experience for legitimate users.

“If there is a financial platform, or are updates to the current platform, that can provide families ESA program funds efficiently and identify any misspending or misuse, then Arizona taxpayers deserve to use that system,� Treasurer Yee said.

Business leaders also voiced support for the initiative, highlighting Arizona’s leadership in school choice and the importance of strong program infrastructure.

“Arizona has long been a leader in school choice and parental decision-making on education,â€� said Danny Seiden, president and CEO of the Arizona Â鶹´«Ã½Ó³»­ of Commerce and Industry. “As both a parent and an advocate for a strong Arizona workforce, I find this to be an incredible strength for our state. Whether it is charter schools, open enrollment or Empowerment Scholarship Accounts, your zip code doesn’t have to determine the quality of your child’s education. I applaud Treasurer Yee for making sure ESA parents have the tools they need to make the most of the program.â€�

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Andy Tobin

There has been a lot of interest and focus by Arizona policymakers on the environmental virtues of nuclear energy. They are absolutely right: nuclear power is a clean-energy marvel. As a former Corporation Commissioner, I advocated for nuclear as part of the backbone of our energy grid, alongside natural gas. Nuclear’s reliability is unmatched, and its footprint is impressively small. Our Palo Verde Generating Station is a crown jewel of our grid, providing 27% of our state’s electricity.

However, in the world of energy policy, there isn’t a “silver bullet.” We need “silver buckshot.” We don’t have to choose between nuclear and renewables – we need an energy portfolio that includes both. That keeps prices low for Arizonans and meets our skyrocketing energy demand.

The Power of the Market

For those of us who believe in the power of markets, the best news isn’t found in a government mandate – it’s found in the competitive “All-Source RFP” process used by our major utilities. Today, when Arizona needs new power, we don’t pick winners and losers from the Capitol Mall in Phoenix. We let the market decide.

In these processes, technologies compete. What we are seeing is that renewable projects are winning a seat at the table not because of a mandate, but because they are often the most cost-effective way to protect ratepayers’ wallets while meeting our surging energy demands. By 2027, APS intends to add over 6,000 MW of renewable power, integrated with battery storage. – enough to power 450,000 homes.

One important reason why is that utility-scale renewables can be built now. Despite the need and ongoing work to reform federal permitting, advanced nuclear and small modular reactors take years – or decades – to plan, permit, and build.

In contrast, solar and wind projects can be deployed with incredible speed – often in less than 24 months. By embracing renewables today, we get the immediate “juice” our grid demands, while we work together to build the nuclear backbone of tomorrow.

A Diverse Energy Portfolio

The Arizona Corporation Commission decades-old renewable mandates, citing the fact that these technologies can now stand on their own two feet in a free market. This is a victory for conservative principles. It shows that renewable energy is no longer a liberal project – it is a business project.

Champions of nuclear power are right that it is cleaner than many realize. But let’s also remember that solar and wind provide stable income for rural ranchers, tax revenue for our local schools, and one way to generate power without exhausting our most precious natural resource: water.

Arizona’s energy future demands a diverse approach – “silver buckshot� not a “silver bullet.� More nuclear, more natural gas, and more renewables. My hope is that we can move past the either/or debates and focus on an all-of-the-above strategy that keeps Arizona’s lights on and economy moving at full speed.

Andy Tobin is president and owner of Tobin Business Solutions LLC and director of The Western Way’s Arizona Rural Energy Network. He served as an Arizona Corporation Commissioner from 2016 to 2019 and represented District 1 at the Arizona Legislature from 2007 to 2015. He served as the speaker of the Arizona House from 2011 to 2014.

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The Arizona Â鶹´«Ã½Ó³»­ of Commerce & Industry has announced the creation of the AZ AI Leadership Initiative, a new coalition bringing together business executives, technology experts, and policymakers to advance artificial intelligence policy, digital infrastructure, and workforce development across the state.

The initiative will focus on ensuring Arizona’s regulatory environment keeps pace with rapid advances in AI and emerging technologies, while also strengthening the infrastructure that underpins the state’s growing digital economy.

“Artificial intelligence is quickly becoming foundational to how businesses operate and compete,” said Danny Seiden, president and CEO of the Arizona Â鶹´«Ã½Ó³»­. “Arizona already has many of the building blocks in place, from semiconductor manufacturing and data infrastructure to world-class research universities. This initiative brings together experts and leaders across industries to ensure our policy environment and infrastructure support continued innovation and economic growth.”

The coalition draws members from sectors including healthcare, advanced manufacturing, finance, logistics, energy, education, and public policy. As AI capabilities expand across those industries, the initiative will engage with policymakers and regulators to help shape a forward-looking strategy that supports job creation and economic competitiveness.

The announcement has already drawn support from legislative leaders at the Arizona Capitol.

“Arizona has made significant progress establishing itself as a hub for advanced technology and innovation,” said House Speaker Steve Montenegro. “As artificial intelligence and advanced technologies continue to evolve, collaboration between policymakers, industry experts, and our communities will be essential to keeping Arizona competitive and prepared for the opportunities ahead.”

Representative Justin Wilmeth, who chairs the House Artificial Intelligence and Innovation Committee, also welcomed the effort. “Artificial intelligence is already transforming industries and creating new opportunities across Arizona’s economy,” Wilmeth said. “I appreciate the Arizona Â鶹´«Ã½Ó³»­ bringing together leaders from across sectors to help guide thoughtful conversations around the future of artificial intelligence and emerging technologies in our state.”

“Arizona is well positioned to lead in artificial intelligence and the digital economy, but staying ahead will take smart policy, strong infrastructure, and a continued commitment to innovation,� said Majority Leader Michael Carbone. “This initiative brings the right leaders together to keep Arizona competitive and turn emerging technology into lasting economic strength.�

Members of the initiative and other technology leaders are scheduled to participate in a roundtable discussion hosted by the Arizona Â鶹´«Ã½Ó³»­ during AZ Tech Week in April.

Organizations interested in joining the coalition can find more information at azleadership.ai.

Image courtesy the   license. Image via .

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A new technology platform launched this month aims to help states strengthen oversight of childcare subsidy programs while preserving access to care for families and providers.

Wonderschool announced the rollout of Wonderschool Oversight, a data-driven platform designed to help state agencies detect potential fraud earlier, conduct more timely audits, and improve payment integrity across childcare programs.

The platform builds on Wonderschool’s existing work with more than a dozen states, including Florida, New Mexico, Michigan, Missouri, West Virginia, and Illinois, where the company already provides technology to support childcare providers and public agencies.

The launch comes as several states, including Minnesota, have faced heightened scrutiny over weaknesses in childcare subsidy oversight following high-profile fraud cases that exposed gaps in data sharing, auditing, and real-time monitoring.

“Arizona employers consistently tell us that the lack of affordable, reliable child care makes it harder to recruit and retain workers, and that’s a real challenge for job creators across our state,â€� said Grace Appelbe, director of government affairs for the Arizona Â鶹´«Ã½Ó³»­ of Commerce & Industry. “The business community wants to be part of the solution, and we’re eager to work with employers, providers, and policymakers to develop childcare options that work for both workers and businesses. At the same time, any new public investment must be done responsibly, with strong oversight and accountability to ensure taxpayer dollars are used as intended.â€�

Childcare subsidy programs play a critical role in supporting working families and employers alike, but many states continue to rely on fragmented, paper-based systems that can make oversight challenging. According to Wonderschool, those manual processes can delay audits, obscure risk patterns, and create administrative burdens for both agencies and providers.

Wonderschool Oversight is designed to address those challenges by centralizing enrollment, attendance, billing, and licensing data into a single platform. Using advanced analytics and artificial intelligence, the system generates continuous, risk-based scoring to flag patterns that may warrant review, while providing “explainable� insights that allow agency staff to understand why an activity was flagged before taking action.

Importantly, the company says the platform is intended to strengthen accountability without creating unnecessary disruptions for providers or families who rely on childcare subsidies.

“The childcare providers that American families rely on are, themselves, often reliant on manual, paper-intensive processes that can exacerbate the oversight challenge for state and federal funders,� said Chris Bennett, CEO of Wonderschool. “Our work with both states and high-quality providers puts us in a unique position to create tools that streamline provider operations while giving agencies visibility into the administration of critical public benefits for children.�

States can deploy Wonderschool Oversight as a standalone solution that integrates with existing subsidy management, licensing systems, and third-party childcare management systems, allowing agencies to implement oversight tools quickly and scale over time. The platform can also be paired with Wonderschool’s broader suite of childcare management, subsidy, and licensing solutions, which are already used by states to expand access, streamline administration, and identify potential misuse earlier in the process.

As states continue to focus on improving accountability for public dollars while expanding access to reliable childcare, technology-driven tools like Wonderschool Oversight may offer a path to achieving both goals simultaneously.

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The State of Arizona has launched its biggest-ever campaign to eliminate the digital divide with a $967 million investment in broadband technology across rural and underserved communities.

The allocation comes via the state’s Broadband Equity, Access & Deployment (BEAD) program, which utilizes a mix of federal funds and private matching dollars. Arizona’s BEAD spending plan has now been approved by the National Telecommunications & Information Administration, enabling the effort to move forward.

“Opportunity for every Arizonan means access to fast, affordable, reliable internet, no matter your zip code,â€� said Governor Katie Hobbs “With this historic investment, we’re not just closing the digital divide, but also opening doors to economic opportunity in every corner of our state. I’m grateful to the ACA and everyone who has played a role in advancing this critical project. From education to health care to workforce development, broadband is key to Arizona’s present and future.â€�

Arizona’s plan will cover 70 project areas encompassing an estimated 160,000 eligible households and over 1,200 “community anchor� institutions, such as schools, libraries and hospitals.

“This is a transformational moment for Arizona,� said Sandra Watson, President & CEO of the Arizona Commerce Authority. “With final BEAD approval, we are moving full speed ahead to connect every household and community with high-speed internet.�

It is estimated the broadband rollout will include the installation of more than 7,700 miles of fiber optic technology statewide. Construction is expected to begin in early 2026.

Lack of reliable, high-speed Internet has long been cited as an economic impediment in rural and tribal communities. Quality broadband is now considered essential technology for telehealth patients, job-seekers, entrepreneurs, students and more.

“Fiber broadband is core 21st-century infrastructure,� said Travis Lingenfelter, Chairman of the Mohave County Board of Supervisors. “This BEAD funding further equips rural Mohave County with the connectivity needed for education, healthcare services, public safety, industrial and small-business growth, and a stronger quality of life.�

“On behalf of the Kaibab Band of Paiute Indians, I wish to express our appreciation and gratitude for this BEAD program and the prospect of connectivity,� said Roland Maldonado, Tribal Chairman of the Kaibab Band of Paiute Indians. “As a far northern Arizona tribe in an extreme rural community without the modern conveniences of readily available connections to cellular networks and fiber optics with high-speed internet access, this becomes a real-time technological welcomed change.�

An Arizona-based broadband provider, Wecom Fiber, is the single largest BEAD awardee – securing $195 million in BEAD funds to connect homes and businesses across 17 project areas in eight Arizona counties.

“This historic broadband investment will change lives for the better across Arizona by ensuring every corner of our state has access to reliable, high-speed internet,� said Wecom CEO Paul Fleming. “We thank Governor Hobbs and the State Broadband Office, the Trump administration, our local and community partners, and every Arizona citizen who participated in the public planning process.�

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With Congress weighing a slate of federal permitting reforms over the next two weeks, national and Â鶹´«Ã½Ó³»­anufacturing leaders are urging lawmakers to modernize outdated processes that they say are slowing down job-creating projects in every corner of the country. 

The National Association of Manufacturers (NAM) is calling the window the “,â€� urging House members to advance several bills — including the PERMIT Act and the SPEED Act — aimed at streamlining federal reviews, clarifying the scope of environmental statutes, and shortening timelines for major infrastructure, energy, and industrial projects.  

NAM President and CEO Jay Timmons said momentum is building for bipartisan action. 

“Congress has an opportunity over the next 12 days to demonstrate strong, bipartisan momentum on comprehensive permitting reform,â€� Timmons said in a statement. “Manufacturers urge policymakers to seize the moment and make it easier and more cost-efficient for manufacturers to get shovels in the ground on job-creating projects.â€� 

For Arizona, the debate in Washington carries significant weight. The state is facing rising demand for power, advanced manufacturing capacity, and data-center infrastructure — all sectors that hinge on timely federal approvals. Â鶹´«Ã½Ó³»­ leaders say lengthy permitting processes increase costs, deter investment, and make it harder for Arizona to meet workforce and energy needs tied to semiconductor manufacturing, AI development, and onshoring supply chains. 

Arizona Â鶹´«Ã½Ó³»­: predictable permitting is essential for competitiveness 

Arizona Â鶹´«Ã½Ó³»­ of Commerce & Industry President and CEO Danny Seiden said modernizing federal permitting is critical for Arizona’s economic future. 

“Manufacturers can’t meet demand, onshore supply chains, or power new AI and data-center growth without a permitting system that works,â€� Seiden said. “Arizona’s economy depends on major projects moving on predictable timelines. Congress should advance the PERMIT Act and the SPEED Act so companies can build the infrastructure and capacity our economy requires.â€� 

Seiden added that Arizona has already seen projects slowed or complicated by federal bottlenecks, noting that stronger permitting coordination will help reinforce the state’s position as a national leader in advanced manufacturing. 

AMC: Federal uncertainty hits small and mid-sized manufacturers hardest 

Grace Appelbe, executive director of the Arizona Manufacturers Council, said modernizing federal processes would reduce uncertainty for Arizona companies, especially the small and medium-sized firms that make up the backbone of the state’s supply chain. 

“Long, unpredictable permitting timelines create real challenges for Â鶹´«Ã½Ó³»­anufacturers trying to expand, upgrade equipment, or bring new technologies online,â€� Appelbe said. “Streamlining these reviews will give companies more certainty, lower costs, and strengthen Arizona’s ability to compete for new investment.â€� 

Appelbe noted that many Â鶹´«Ã½Ó³»­anufacturers planning new facilities or energy upgrades face multi-agency review processes that can take years. “A clearer federal framework would help every part of the supply chain plan more confidently,â€� she said. 

National implications for energy and AI growth 

According to NAM, more than 80% of manufacturers say today’s permitting challenges hinder their ability to invest, and nearly nine in 10 report they would expand operations or hire more workers if the federal process were streamlined. Reforms under consideration would simplify Clean Water Act reviews, reduce duplicative federal studies, expand categorical exclusions, and accelerate environmental assessments needed for large-scale projects. 

For Arizona, business leaders say the stakes are especially high. The state is home to rapidly expanding semiconductor fabs, aerospace production lines, defense manufacturing, AI-driven data centers, and massive energy infrastructure needs, all of which depend on permitting predictability. 

What comes next 

The House is expected to take up several permitting reform bills over the next two weeks. NAM is urging lawmakers to advance the PERMIT Act and a series of companion bills this week, followed by the SPEED Act — legislation the organization calls a cornerstone of U.S. competitiveness in energy and emerging technologies — next week. 

Manufacturing leaders say Senate action will be essential in the new year to convert these efforts into lasting policy changes. 

For Â鶹´«Ã½Ó³»­anufacturers and utilities preparing for dramatic load growth, Â鶹´«Ã½Ó³»­ and AMC leaders say they will continue advocating for reforms that allow job-creating projects to move forward at the pace the economy demands. 

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The Arizona Corporation Commission on Wednesday approved Tucson Electric Power’s proposed Energy Supply Agreement, or ESA, for a major new data center project following testimony from leading members of Arizona’s business community.

The Arizona Â鶹´«Ã½Ó³»­ of Commerce & Industry and the Arizona Manufacturers Council argued that the agreement establishes a model for responsible economic development, ensuring that large-scale industrial users pay their fair share while bolstering the state’s competitiveness for high-tech investment.

Grace Appelbe, executive director of the AMC, testified at the hearing, emphasizing that the agreement prioritizes the stability and affordability of Arizona’s energy grid.

“Arizona’s employers rely on stable, affordable, and reliable energy,� Appelbe told commissioners. “Our ability to attract major investment—especially high-tech and manufacturing projects—depends on a regulatory environment that provides certainty while protecting existing customers.�

“Growth pays for growth�

At the center of the hearing was the ESA between TEP and Humphrey’s Peak Power, LLC, regarding the initial phase of a southeast Tucson data center previously known as “Project Blue.�

Business leaders praised the agreement for adhering to a strict “growth pays for growthâ€� principle. According to the testimony and filings submitted by the Â鶹´«Ã½Ó³»­ and AMC, the deal includes robust safeguards to prevent cost-shifting to residential or small business customers.

“The customer will pay the Commission-approved rate for TEP’s largest users, without any discounts or incentives,� Appelbe testified.

Key provisions of the agreement designed to protect existing ratepayers include:

• Full cost recovery: The project will pay standard rates with no subsidies.
• Risk mitigation: The contract includes credit requirements, minimum demand payments, and termination fees.
• Resource adequacy: The initial phase will be served using existing resources and clean-energy assets already in development, avoiding the need for immediate new generation.

“These protections ensure that if the project doesn’t build out as expected, there is no cost-shifting to residential or small business customers,� Appelbe said.

Economic benefits and grid efficiency

In a letter submitted to Commission Chairman Kevin Thompson and the commissioners, the Â鶹´«Ã½Ó³»­ and AMC highlighted the broader economic advantages of attracting hyperscale data centers. These projects generate significant capital investment, construction activity, high-wage jobs, and long-term tax revenue.

Beyond direct economic injections, the business groups argued that high-load customers actually help stabilize rates for all users. By providing consistent, 24/7 energy usage, data centers help spread the utility’s fixed system costs across more kilowatt-hours.

“In a traditionally regulated state like Arizona, major loads, such as data centers, will help lower the revenue requirement from all other customers, reducing upward pressure on rates,â€� the Â鶹´«Ã½Ó³»­ and AMC wrote in their joint letter.

Outlook

TEP has indicated that while the initial phase will utilize existing capacity (up to 286 MW), future phases will require the customer to fund new resources to meet their demand.

The business community expressed support for this framework, noting that TEP has completed the rigorous technical studies required to ensure reliability is maintained.

Appelbe concluded her testimony by urging the Commission to approve the agreement, framing it as a signal to the market that Arizona can accommodate major employers responsibly.

“Approving this agreement sends a clear signal that Arizona can meet the energy needs of major employers while keeping costs fair for everyone,� Appelbe said.

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