Phoenix City Council to consider zoning policy for data centers
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Phoenix plans to implement zoning regulations to restrict the locations of data centers like this one, shown under construction in January 2024. Photo: Ash Ponders/Bloomberg via Getty Images
Phoenix is on the verge of enacting zoning regulations to limit where data centers can be located.
Why it matters: Data centers use large amounts of energy and space and can bring negative effects like noise pollution to surrounding communities, per an analysis by city staff.
State of play: The city wants to direct data centers away from mixed-use, walkable and transit-oriented communities.
- They create few jobs, take up land that could be used for employment and housing, and make "inactive" stretches of street, staff wrote.
Zoom in: Under the proposal, data centers would be restricted to areas zoned for industrial and some commercial use.
- They would have to get a permit before locating in those areas.
- Data centers would be required to mitigate noise if they're within 300 feet of residential areas, be at least a half-mile from high-capacity transit, and use decorative features for architecture and landscaping to "avoid large, monotonous, undifferentiated surfaces" and "large, monolithic buildings," according to a staff report.
The big picture: Data centers house computer equipment for data storage and are essential for companies including Amazon and Google and technologies such as artificial intelligence.
- The Phoenix metro area has become one of the top data center markets in the U.S. due to low energy costs and a relative lack of natural disasters.
- Driven by the growth of AI and other technologies, data centers are increasing energy use not only in Arizona but nationwide.
By the numbers: There are 164 data centers in Arizona, mostly in the Valley, according to research firm Baxtel.
- Tricia Gomes, Phoenix's deputy director for planning and zoning, told Axios that Phoenix has a number of data centers planned.
What's next: The city's planning commission will hear the proposed policy on June 5, and the City Council is expected to vote on it June 18, Gomes said.
Flashback: Chandler became the first Valley city to enact zoning for data centers in late 2022, the Arizona Republic reported.
- Phoenix was the second to initiate the process in December 2024.
What we're watching: The Corporation Commission last month opened a review on data center policies to find a way to cope with their extensive energy use.
- One possibility the commission might consider is higher power rates for data centers.
- In a statement to Axios, Phoenix Mayor Kate Gallego said data centers bring few jobs or community amenities, and that she prioritizes "economic development that results in good-paying jobs and dynamic, walkable neighborhoods."
- "Smart development requires a balanced approach," she said, "and Arizona would benefit from policy parameters to protect our grid and prioritize job creation."