Now Aiming for Carbon Neutral by 2050
Arizona Public Service (APS), the largest electric utility in Arizona, has recalibrated its clean energy ambitions. In a notable policy shift, APS reversed its landmark 2020 pledge to achieve 100% clean, carbon-free electricity by 2050. Instead, the utility will now pursue an “aspirational carbon-neutral” goal by 2050, balancing decarbonization efforts with practical needs for reliability and cost control. This means that rather than eliminating all carbon emissions from power generation, APS may still emit some carbon in 2050 but will offset those emissions elsewhere to reach net-zero overall. The change also comes with the removal of interim clean energy targets (for example, APS has scrapped its prior goal of 65% clean energy by 2030) to give the utility more flexibility in the near term.
What Happened and Why the Shift?
APS’s original commitment, announced in 2020, was to deliver electricity with zero carbon emissions by 2050, one of the power sector’s most ambitious climate pledges. However, on an August 2025 earnings call, APS CEO Ted Geisler revealed the company is abandoning its zero-carbon plan in favor of a carbon-neutral approach by 2050. APS’s parent company Pinnacle West explained the rationale: Arizona’s population and economy are booming, driving up electricity demand, and the utility must use “the most reliable and cost-effective resources available” to keep pace. In simple terms, APS found that aiming for absolute zero carbon by 2050 could undermine reliability and affordability, given current growth and technology constraints.
Under the new carbon-neutral plan, APS will continue to reduce greenhouse emissions, but any remaining emissions in 2050 would be balanced by carbon reductions elsewhere (such as carbon offsets or carbon capture). This contrasts with a 100% clean (zero-carbon) goal, which would require eliminating all carbon emissions from power generation entirely. Which is a far more stringent standard. APS leadership noted that the earlier zero-carbon plans were “aspirational goals” made at a time of different expectations. The pivot signals a more pragmatic strategy: still moving toward cleaner energy, but with an emphasis on keeping the lights on and costs in check.
Several short-term targets were also rolled back as part of this shift. Notably, APS rescinded its goal of getting 65% of power from clean sources by 2030. By removing interim checkpoints, the company says it can better focus on the overarching 2050 objective while responding to near-term challenges. This flexibility suggests APS will rely on the state’s formal Integrated Resource Planning process to determine the most responsible path forward over time.
Why It Matters: Reliability Amid Climate and Growth Pressures
APS’s decision comes at a pivotal moment. The Southwest is grappling with climate-driven stress on the electric grid from record-breaking heat waves to prolonged drought which makes maintaining reliable power more challenging. At the same time, Arizona’s population and energy needs are growing rapidly, increasing the strain on the grid. APS has seen year-over-year record peaks in electricity demand during recent summers. By one estimate, peak demand in APS territory could rise about 40% by 2031 as both residential and business customers multiply. This surging demand underscores why reliability is paramount. APS itself noted that setting new peak usage records for three consecutive years was unsurprising “given that Arizona continues to benefit from increasing customer demand and population growth.”
Ensuring the grid can handle extreme conditions has become a top priority. During the summer of 2024, APS’s system hit an all-time high of over 8,200 MW and held up through an intense heat wave. This was achieved by maximizing output from a diverse mix of nuclear, natural gas, renewables, and storage and diligent grid management. It highlights that clean energy goals cannot be viewed in isolation from reliability: during a 115°F heat wave, solar panels alone cannot meet evening air-conditioning demand, and batteries can be depleted after sundown. APS and other utilities must have firm power sources or backups ready to prevent blackouts when intermittent renewables aren’t sufficient.
By shifting to a carbon-neutral goal, APS is effectively acknowledging these challenges. The utility can continue to use some fossil-fueled generation (like natural gas) for reliability, especially on the hottest days or when the sun isn’t shining, as long as those emissions are offset or mitigated by 2050. This approach aims to strike a balance between ambition and pragmatism. APS must integrate “the most reliable and cost-effective resources” to meet Arizona’s fast-growing needs, all while keeping power affordable for customers. In practice, this means diversifying the energy mix rather than rushing to 100% renewables on an impractical timeline.
Balancing Clean Energy with Affordability
Reliability and affordability were repeatedly emphasized by APS in explaining its course correction. “Clean energy remains an important consideration for us,” Geisler said, “but always with a focus on a balanced energy mix that best serves reliability and affordability.” In other words, APS is not abandoning clean energy but it’s recalibrating how to get there responsibly. More than half of APS’s current electricity mix is already supplied by carbon-free resources like nuclear and renewables. The utility operates Palo Verde Generating Station, the largest nuclear power plant in the nation, which by itself provides roughly 27% of Arizona’s electricity and around-the-clock carbon-free power to millions of homes. This nuclear backbone, along with APS’s growing portfolio of solar farms and battery storage, form a strong foundation of clean energy that the company will continue to build on.
What changes under the new plan is how APS manages the “last mile” of decarbonization. Rather than mandating 100% carbon-free generation (which would likely require completely phasing out natural gas plants), APS will keep natural gas in its toolkit as a dispatchable, on-demand resource for those times when solar, wind, and batteries fall short. Natural gas plants can ramp up quickly to meet peak demand and help avoid outages or energy shortages. APS emphasizes this is a “balanced and diverse energy mix” approach: continue adding renewables and storage aggressively, utilize nuclear for steady baseload power, and retain some fast-ramping gas capacity for reliability. By 2029, APS even plans to tap a new 600-mile natural gas pipeline from Texas to bolster fuel supply, a move it says could spur additional investment in Arizona and ensure adequate generation fuel during peak times.
From a cost perspective, this strategy could shield customers from the expense of over-relying on nascent or high-cost technologies. APS has indicated that completely eliminating fossil fuels by 2050 might have meant higher rates or infrastructure costs, whereas a carbon-neutral strategy allows for more flexibility in how goals are met. Critics worry that “carbon neutral” could be a loophole to continue burning gas unchecked, while supporters argue that reliability is non-negotiable.
APS has stressed that it remains committed to reducing emissions over time and that its new goal aligns with other utilities in the region. With Arizona’s energy demand climbing every year, APS leaders say it would be irresponsible not to plan for the challenges ahead. This sentiment captures the crux of the issue: APS is seeking a middle path that acknowledges real-world constraints while still aiming for a cleaner energy future.
Responsible Trade-offs and Hybrid Solutions
The situation with APS illuminates the responsible trade-offs that many utilities are now grappling with. Achieving a low-carbon grid is a high-wire act: it requires balancing renewable expansion with ensuring the grid stays up 24/7. One promising approach is developing hybrid generation systems and community-scale solutions that blend different energy sources for resiliency.
APS has already experimented with microgrids, which are self-contained power systems that can operate both connected to and independent of the main grid. In north Phoenix, APS partnered on a 63 MW microgrid for a large data center, enabling the facility to isolate from the grid during peak congestion and outages. At a military base in Yuma, APS built another microgrid to ensure the base can cover its own demand and stay online during outages. These projects show how localized, resilient systems can support the larger grid by providing critical power when and where needed.
Many microgrids and hybrid energy systems combine renewable and traditional sources. For example, a project at Caterpillar’s Tucson Proving Ground added solar panels and battery storage to a diesel-powered system, reducing diesel use by about one-third each year. This hybrid approach demonstrates that even carbon-based generators can be used more sparingly and cleanly when paired with renewables and smart controls.
For APS and Arizona, such hybrid-generation roadmaps could be a key to achieving carbon neutrality. The utility’s updated plan explicitly mentions looking for dispatchable resources that can provide energy when intermittent resources are insufficient. That doesn’t negate renewables; it complements them. We can envision future power grids that integrate diverse resources: utility-scale solar farms and wind parks, massive battery banks, nuclear plants, fast-ramping gas turbines, and demand-side programs that reduce strain on the system.
Looking Ahead: An Optimistic Path Forward
While some environmental advocates are disappointed by APS’s pivot, there are reasons for optimism. By setting a carbon-neutral target, APS is acknowledging the complexity of the transition and opting for a plan it believes is achievable without compromising service to customers. This realism can build credibility and it shows APS is serious about keeping the grid resilient under climate stress and rapid growth, even as it continues to invest in clean energy.
Arizona can still hit its climate targets through a carbon-neutral approach and it just might look different than originally envisioned. Instead of a straight line to 100% renewables, the journey will involve creative combinations of technologies and incremental improvements. We may see more community microgrids, hybrid power systems, and collaborative projects that together move the needle on clean energy while safeguarding reliability. APS’s flexibility is valuable in a fast-evolving energy landscape.
The updated goal could spur innovative solutions as APS seeks to neutralize emissions by 2050 in cost-effective ways. The hope is that the “carbon” part of carbon-neutral shrinks steadily through more renewables, improved storage, zero-carbon fuels, and offset projects that negate remaining emissions. This is not a step back, but a step toward a viable, resilient, and cleaner energy future for Arizona!
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