Data Centers in Tucson
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Tucson, Arizona, United States – A Stable Hub for Western US Workloads
Executive Summary
Tucson is an emerging data center market for businesses that require a stable, lower-cost, and lower-risk location for disaster recovery or production workloads serving the Western United States. The market offers a compelling alternative to pricier California and Phoenix locations, ensuring infrastructure resilience and uptime for critical applications. Its strong tax incentives directly reduce the capital expense of deploying new hardware.
Tucson, Arizona, United States: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity, though not a primary international network hub. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest cloud access hubs are in Phoenix and Los Angeles; private connectivity is available. |
| Power Cost | $0.07 – $0.09/kWh | Competitive rates driven by a diverse grid with significant solar and nuclear generation. |
| Disaster Risk | High (91.66) – as of September 2025 | Key risks are environmental, such as drought and heat, not seismic or hurricane-related. |
| Tax Incentives | Yes | Multiple state programs offer sales and use tax exemptions on data center equipment. |
| Sales Tax | 5.60% (State) – as of Midyear 2025 | Local sales taxes may also apply. |
Network & Connectivity Ecosystem
Tucson provides a solid foundation for regional connectivity, serving as a reliable secondary market to the primary Arizona hub in Phoenix.
Carrier Density & Carrier Neutrality: The market is served by over 5 carriers as of September 2025. This provides foundational network diversity for most business needs, with multiple carrier-neutral facilities available to ensure competitive pricing and high uptime.
Direct Cloud On-Ramps: There are no direct public cloud on-ramps within Tucson data centers. Businesses connect to cloud providers like AWS, Google Cloud (GCP), and Microsoft Azure through the nearby Phoenix and Los Angeles markets. Secure, high-performance access is achieved via private network interconnects and wavelength services.
Internet Exchange Points (IXPs): Public peering is limited in Tucson. Most network peering for Arizona is concentrated at exchange points located in Phoenix, which acts as the state's primary interconnection hub.
Bare Metal: Bare metal server options are available, offering dedicated compute for performance-sensitive applications. Providers such as phoenixNAP and Hivelocity serve the broader Arizona region, providing on-demand infrastructure without virtualization overhead.
Power Analysis
Arizona's power infrastructure is a significant advantage for data center operators in Tucson, offering both stability and cost-effectiveness.
Average Cost Of Power: Industrial power rates typically range from $0.07 to $0.09/kWh as of September 2025. This competitive pricing creates predictable operational expenses, especially for high-density computing and large-scale deployments.
Power Grid Reliability: The regional power grid is well-engineered and reliable, supported by a diverse generation portfolio that includes nuclear, natural gas, and one of the largest solar power capacities in the nation. Data centers in the area are typically fed by redundant power substations to support uptime guarantees.
Market Access, Business & Tax Climate
Tucson offers strategic access to key regional industries and favorable tax policies for data center operators and tenants.
Proximity To Key Business Districts: Data centers in Tucson provide low-latency connectivity to the University of Arizona, a major research institution, and the region's significant aerospace, defense, and optics industries. This proximity supports critical research, development, and manufacturing workloads.
Regional Market Reach: The city is ideally positioned to serve the Southern Arizona market and functions as an excellent disaster recovery location for businesses in Phoenix and Southern California. It also provides a strategic point of presence for workloads serving Northern Mexico.
Tax Advantage For Data Centers: Arizona provides significant tax advantages through its Computer Data Center Program. These incentives primarily offer sales and use tax exemptions on qualified data center equipment, directly reducing the capital expenditures required for new builds and hardware refreshes.
Natural Disaster Risk
Tucson has a High natural disaster risk profile, with a National Risk Index score of 91.66 as of September 2025. While the overall score is high, the market is insulated from many of the threats, like hurricanes and major flooding, that affect other regions.
The primary risks are environmental and geological, including:
- Drought
- Earthquake
- Heat Wave
- Landslide
- Riverine Flooding
- Wildfire
