TUCSON, Ariz. (KGUN) — The Arizona Corporation Commission (ACC) voted 4-1 on Wednesday to approve a special Energy Supply Agreement between Tucson Electric Power and Delaware-based Humphrey’s Peak Power LLC for a large data center campus planned in Pima County.
An Energy Supply Agreement is a binding contract that sets the terms, pricing, and delivery conditions for electricity between a utility and a major customer.
"The Commission’s role is to review the ESA to ensure it meets regulatory requirements and provides protections for all TEP customers," the commission said in a release. "The Commission does not have jurisdiction over the type of project associated with the ESA. TEP, like all other public utilities in the state, has an obligation to serve all customers in its designated service territory without discrimination."
TEP has maintained that the agreement includes full cost-of-service pricing and multiple protections that prevent any impact on other customers’ rates or reliability.
The company also said that there could be potential broader grid benefits from the new transmission infrastructure, including support for Pima County and the City of Tucson economic development zones.
Construction on the data center campus has not yet begun, and local land-use approvals remain unresolved after the Tucson City Council previously rejected an earlier version of the project.
With the ACC’s approval now in place, TEP states it could begin delivering power to the site as early as May 2027 if the developer secures the remaining permits and completes construction.
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