Interconnection Queue Review: Arizona Public Service
Arizona Public Service (APS) is the largest energy provider in Arizona, serving about 1.4 million customers across the state. Its territory has emerged as a prime location for renewable energy and battery storage development, largely due to Arizona’s abundant solar resources.
As part of Enverus Project Tracking Analytics, we review project development processes within each utility and interconnection queue across the U.S. to provide a comprehensive project overview.
By delving into trends within the APS interconnection queue, we can gain insight into how APS has nurtured this development, and what the future of the region’s energy landscape will look like.
APS’s place in the nationwide energy landscape
Figure 1- Enverus P&R Project Tracking: Most planned capacity by utility queue
The APS territory is one of the nation’s leaders for power generation development, particularly in renewables and storage. Adding to the rush, the Phoenix area has become a hotbed of data center development as well. Of the 20 major utilities across the nation that we currently track (not including ISOs), APS has the third-most total planned capacity in the queue, trailing only the Bonneville Power Authority and Pacificorp. It also has the third-most planned capacity specifically in each individual category of wind, solar and storage project types as well, reflecting its emphasis on expanding sustainable generation capabilities to support growth.
Figure 2- Enverus P&R Project Tracking: Most total planned capacity by county
On a county level, APS’s prominence is clear. Four of the top 10 counties in the U.S. for total planned capacity are in APS’s territory, including Maricopa County, which leads overall. Additionally, four APS counties are in the top 10 for planned solar capacity and three for storage.
Figure 3- Enverus P&R Project Tracking: Most total planned capacity by state
On a state level, Arizona has the third most total planned capacity in the nation, behind only Texas and California. It has the third most planned storage capacity and the second most planned solar capacity.
Taking the lead in the energy transition
Figure 4- Enverus P&R Project Tracking: Total capacity added to APS queue, by project
type and first queue date
From 2016-2021, there was a rapid and consistent year-over-year uptick in power generation capacity added to the APS Interconnection Queue, comprising almost exclusively renewables and storage projects. Queue activity has cooled slightly since that peak in 2021 but is still consistently far higher than it was before. And as discussed in the previous section, far higher than most of the rest of the country.
Figure 5- Enverus P&R Project Tracking: Projected capacity changes by fuel type over next 15 years, via the most recent IRP goals from APS
Figure 6- Enverus P&R Project Tracking: Operating Capacity in APS by First Power Date
That trend is in line with the most recent APS Integrated Resource Plan, which indicates a commitment to shifting the energy mix away from fossil fuels like coal and towards renewables and storage over the next 15 years. And they are already beginning to deliver on that promise. In 2024 alone the Babbitt Ranch Wind and Chevelon Butte 1 & 2 Wind projects were all brought online, totaling 615 MW of capacity. This followed a productive year for storage projects in 2023, when 251 MW of storage capacity (spread across nine projects) were brought online. The specific project types are different than the IRP projected; it called for more solar thus far and less wind. However, the total renewables plus storage projection for the years 2023 and 2024 was 795 MW, which has been outpaced thus far by the 866 MW built.
Figure 6- Enverus P&R Project Tracking: Operating capacity in APS by first power date
One other interesting feature of the IRP is its approach towards natural gas. In sum, the utility plans to add 409 MW of natural gas over the next 15 years. However, it plans to arrive at that number through a combination of both building but also decommissioning thousands of MWs of natural gas plants, beginning around the year 2030. It appears that they want to more or less maintain their current levels of natural gas usage, but are in a position where they need to invest heavily in the resource in order to do so. That investment indicates that APS has no plans to completely abandon traditional energy sources like gas, even if it isn’t as prominent in their plans as renewables are.
Looking to the future
The alignment between the APS IRP and the interconnection queue is a very encouraging sign for future growth. Currently, 34% of the operating APS energy mix is renewables or storage. If the next 15 years of development continue to proceed as the IRP lays out, it will add 4,951 MW of renewables and storage capacity and 409 MW of natural gas, resulting in an energy mix that is 64% renewables or storage.
So, what can these trends tell us about the overall future of the APS energy landscape? The data paints an appropriately sunny picture for the state of Arizona. With the amount of development already underway and a strong track record behind them, Arizona Public Service looks poised to maintain its status as one of the leaders of the energy transition.
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