Arizona Public Service (APS), City of Mesa, Salt River Project (SRP), Tucson Electric Power (TEP) and UniSource Energy Services announced commitment plans for Transwestern Pipeline’s Desert Southwest expansion project. This new natural gas pipeline will help maintain year-round regional energy reliability by transporting natural gas from the Permian Basin in West Texas to Arizona by late 2029 once construction is completed.
APS and SRP each reviewed multiple proposals and have independently executed agreements with Transwestern to provide customers with the best combination of reliability and affordability to meet future energy demand. The agreements give the utilities priority delivery of low-cost natural gas to support Arizona’s rapid growth and the integration of clean energy technologies to the electric grid. The City of Mesa, TEP and UniSource are finalizing negotiations with Transwestern. TEP and UniSource expect to move forward with an agreement prior to the open season solicitation process later this year.
“Arizona’s energy needs are growing drastically, which is why it is so important for the state’s utilities to anticipate and prepare for the future,” said Kevin Thompson, Chairman of the Arizona Corporation Commission. “For years, Arizona residents and the state’s economy have benefited from one of the most reliable energy grids in the country. I applaud APS, City of Mesa, SRP, TEP and UniSource for their commitment to maintaining this reliability and helping to secure Arizona’s energy dominance.”
With more people and businesses moving to Arizona, energy demand is rising at an unprecedented rate, and utilities are investing in infrastructure to serve this growth. Today, all existing interstate pipelines serving Arizona are fully subscribed. There is sufficient natural gas supply in the Permian Basin, but additional pipelines are needed to serve Arizona power plants and maintain reliability in all seasons.
On hot summer and cold winter days, the pipeline would fuel critical natural gas facilities that boost the energy grid to help keep customers safe and comfortable, and businesses operating. Each utility conducted its own thorough evaluation and negotiation process before identifying Transwestern Pipeline’s Desert Southwest expansion project as the top option for its customers. As the utilities continue to add cost-effective clean energy to their portfolios, natural gas is needed to maintain strong reliability across the region including when solar and wind resources aren’t producing and battery energy storage isn’t available.
“As Arizona continues to grow, so must the energy infrastructure that powers it. This new pipeline represents a long-term commitment to reliability, resilience and affordability,” said Ted Geisler, APS President and CEO. “By securing additional access to natural gas, we’re ensuring our grid has the flexibility and strength to meet customer needs – even on the hottest summer days – while supporting the economic momentum that makes Arizona such a great place to live and do business.”
“This pipeline marks a pivotal advancement in long-term infrastructure planning, reinforcing the foundation for a resilient and prosperous future for Mesa and the State of Arizona,” said City of Mesa Mayor Mark Freeman.
“SRP is working to at least double the number of generating resources on its power system in the next 10 years to meet increasing energy demand in the Phoenix metropolitan area,” said Jim Pratt, SRP General Manager and CEO. “Natural gas resources play a key role in maintaining reliable and affordable power as we pursue an all-of-the-above approach that also includes adding wind, solar and storage to our energy mix.”
“Natural gas resources will play a crucial role in providing customers with safe, reliable energy as Arizona’s economy grows,” said Susan Gray, President and CEO of TEP and UniSource. “New natural gas resources will support stable, affordable service for our communities as emerging technologies create new ways to reduce the carbon intensity of Arizona’s energy supply.”
