Data Centers in Tucson
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Tucson – A Resilient & Cost-Effective Arizona Hub
Tucson offers a compelling alternative to more congested data center markets, providing a resilient and cost-effective location for disaster recovery and West Coast operations. Its strategic position in Arizona, combined with strong state-level tax incentives, makes it an excellent choice for businesses prioritizing uptime and operational savings.
Tucson: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid connectivity, though not a primary international hub. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest major cloud hubs are Phoenix and Los Angeles; PNI/wave options are available. |
| Power Cost | ~$0.08-0.11/kWh, as of September 2025 | Competitively priced industrial power supports high-density deployments. |
| Disaster Risk | High (91.66 Score), as of September 2025 | Primary risks are environmental; lacks hurricane or major coastal flood threats. |
| Tax Incentives | Yes | Multiple DC-specific programs, including sales, use, and Transaction Privilege Tax exemptions. |
| Sales Tax | 5.60% (Arizona State), as of Midyear 2025 | Favorable state-level sales tax, with potential exemptions for data center equipment. |
Network & Connectivity Ecosystem
Tucson's connectivity is reliable for regional workloads, serving as a secondary market to primary hubs like Phoenix and Los Angeles. The ecosystem is defined by good carrier diversity and access to major networks, although direct connections to cloud providers require a short-haul link.
Carrier Density & Carrier Neutrality: Tucson is served by over 5 national and regional carriers as of September 2025. The market features carrier-neutral facilities, ensuring competitive network pricing and diverse routing options for redundancy.
Direct Cloud On-Ramps: There are no direct public cloud on-ramps within Tucson's data centers. The nearest access points are in Phoenix, providing connectivity to all major cloud providers. Private network extensions offer dedicated and secure access.
Internet Exchange Points (IXPs): Most network peering occurs privately or through facilities in Phoenix. This model provides efficient traffic exchange for reaching regional end-users without requiring a local public IXP.
Bare Metal: Bare metal server options are available in the region, often hosted out of nearby Phoenix. Providers like phoenixNAP offer dedicated server solutions accessible with low latency from Tucson.
Power Analysis
Arizona's power infrastructure is a significant advantage for data center operators in Tucson. The grid is well-maintained, drawing from a diverse fuel mix that includes a high percentage of natural gas and nuclear, ensuring stability for mission-critical operations.
Average Cost Of Power: Industrial electricity rates are estimated between $0.08 and $0.11 per kWh as of September 2025. These competitive rates help reduce the total cost of ownership for compute-intensive workloads.
Power Grid Reliability: The region's power grid is engineered for high reliability, with support from multiple substations and redundant transmission paths. The energy mix, which includes 53% fossil fuels and 27% nuclear, contributes to consistent and dependable power delivery.
Market Access, Business & Tax Climate
Tucson provides a business-friendly environment, supported by strong state-level initiatives and a strategic geographic location capable of serving multiple major markets.
Proximity To Key Business Districts: Data centers in Tucson serve local enterprises, the University of Arizona's research corridor, and aerospace and defense contractors. This proximity allows for low-latency connections supporting critical research and development activities.
Regional Market Reach: From Tucson, organizations can effectively serve end-users across Southern Arizona, Northern Mexico, and as a disaster recovery site for operations in Southern California and Phoenix.
Tax Advantage For Data Centers: Arizona provides significant tax benefits for data centers. The Computer Data Center Program offers sales and use tax exemptions on equipment purchases, directly lowering the capital expense of building or expanding a data center footprint.
Natural Disaster Risk
Tucson has a High natural disaster risk profile, with a FEMA National Risk Index score of 91.66 as of September 2025. However, the primary risks are environmental and geological, and the market is free from significant hurricane, coastal flooding, or tornado threats. Key hazards include:
- Drought
- Earthquake
- Heatwave
- Landslide
- Riverine Flooding
- Wildfire
