Optimistic: 70% solar @ $40/MWh + 20% battery @ $200/MWh + 10% gas @ $150/MWh = $143/MWh
Realistic: 50% solar @ $40/MWh + 30% battery @ $220/MWh + 20% gas @ $180/MWh = $182/MWh
Conservative: 30% solar @ $40/MWh + 40% battery @ $240/MWh + 30% gas @ $200/MWh = $228/MWh
Important Note: These marginal cost estimates exclude network upgrades, transmission costs, permitting costs, and environmental compliance costs
Tax Rate: 8.7% combined TPT (5.6% state + 2.6% city + 0.5% county)
Water Impact Model
The water impact uses a "shadow price" methodology to capture the true economic value of water:
Net Water = (Water Bill × 2.6% Tax Rate) - ((Shadow Price - Market Price) × Annual Usage)
Potable Water Price: $1,594.30/AF (Tucson Water base industrial rate - excludes summer surcharges)
Potable Shadow Price: $4,500/AF (analyst assumption based on: $800/AF new supply cost + $700/AF opportunity cost + $3,000/AF drought resilience value)
Reclaimed Water Price: $1,036.73/AF (official purple pipe rate - subject to annual escalation)
Reclaimed Shadow Price: $1,500/AF (analyst assumption based on marginal cost to expand reclaimed system)
Tax Rate: 2.6% (City of Tucson TPT only)
Construction vs. Equipment
Construction: Building the facility creates local jobs and procurement. ~48.9% stays in the local economy as wages and materials
Equipment: Servers and cooling systems get an 8.7% tax exemption under Arizona's CDC program for 20 years when the project qualifies as a "sustainable redevelopment project" through LEED or similar green building certification
Note: Both Google and Meta build their data centers to LEED Gold standards or higher, qualifying them for the 20-year exemption period