# Arizona residents push back against new data centers

> Arizona welcomed TSMC’s chip plants, but proposed data centers face growing opposition over water, power and land. Project Blue in Tucson is still moving ahead.

Oossa · 2026-10-29 · https://oossa.com/en/arizona-residents-push-back-against-new-data-centers

Arizona residents are organizing against large data center projects, worried that they will use scarce water and electricity without bringing the same lasting economic benefits as chipmaker TSMC. The contrast is clear in Phoenix: TSMC’s Arizona complex uses nearly 5 million gallons of municipal water a day and has brought more than 3,500 jobs, while newer data center proposals are drawing protests and scrutiny.

One focus is Project Blue, a planned data center on a 290-acre site near Tucson. After residents packed public meetings to oppose it, the Tucson City Council voted against annexing the land, a step initially presented as necessary for the deal. Beale Infrastructure, the developer, nevertheless continued with the project. Arizona approved two wells that could draw up to 31 million gallons of groundwater a year for construction. Beale says the operating facility will use water only for ordinary needs such as restrooms and kitchens.

Beale changed its plan from water cooling to closed-loop air cooling. The company says the switch does not raise the project’s overall energy use. Critics argue that air cooling may increase water use indirectly because power plants need water too. Amazon reportedly withdrew as a prospective tenant after the change; Beale has not disclosed whether it has found another tenant.

## Why the response has changed

TSMC’s success helped make industrial development seem like a route to jobs and investment. Its Arizona spending projection has grown from $12 billion to $265 billion, and the company has built two fabs, with a third under construction. Earlier data centers also drew little notice, in part because, as Phoenix economic developer Christine Mackay put it, the first ones looked like “pretty little office buildings.”

The newer projects are larger and more visible, often proposed for rural or desert land. Residents are also weighing them against Arizona’s water constraints: the state is expected to lose nearly 30 percent of the water it receives from the Colorado River. In Tucson, local opposition has led to tighter city rules, and Pima County imposed a 120-day pause on new data center projects. Those steps have not stopped Project Blue, whose construction has continued amid protests and disputes over water used at the site.

## The facts

- TSMC’s Arizona operation uses nearly 5 million gallons of Phoenix municipal water per day, according to The Verge.
- TSMC’s projected investment in Arizona grew from $12 billion to $265 billion, and the company has more than 3,500 employees in the state.
- Project Blue is planned for a 290-acre site near Tucson; Arizona approved two wells that could supply up to 31 million gallons of groundwater a year for construction.
- Beale says Project Blue will use water only for ordinary domestic needs once operational; the company has not disclosed whether it has a new tenant after Amazon reportedly withdrew.

## Why it matters

For Tucson residents, the dispute concerns whether a major new facility can proceed while drawing on local water and power systems, even after the city rejected annexing its site. Beale says the wells are for construction and operating water use will be limited, but the project is still moving forward and its eventual tenant has not been disclosed.

## Sources & references

1. [AI has come for Arizona’s water](https://www.theverge.com/cs/features/1016650/arizona-water-data-center-tsmc) – The Verge, 2026-10-29

Last updated: 2026-10-29