2026 Integrated Resource Plan

Balancing Reliability, Affordability and Sustainability

Every resource-planning decision must balance three core priorities: reliability, affordability and sustainability. Our preferred portfolio supports all three.

Reliability

You depend on reliable electric service every hour of every day, especially during periods of extreme heat and high energy use. To maintain reliability, the preferred portfolio includes a diverse mix of natural gas generation, solar power, battery storage, and market resources rather than a reliance on any single technology.

The plan incorporates updated reliability studies and an 18 percent planning reserve margin, which helps ensure that sufficient capacity is available if demand exceeds forecasts or generating and transmission resources are unavailable. We also evaluated whether each portfolio could support extended periods of peak demand under challenging operating conditions.

Battery storage will help shift solar energy produced during the day to evening hours when demand remains high and solar generation declines. Natural gas resources provide firm, dispatchable capacity that can support reliability during extreme heat, overnight hours, and other periods when renewable resources or stored energy are limited.

Affordability

Customer affordability remains a critical consideration in our planning decisions. The preferred portfolio produced the lowest overall cost among the portfolios evaluated under the base load forecast while satisfying reliability requirements.

The plan also preserves flexibility. Future resources will be pursued through competitive all-source requests for proposals, allowing UniSource to evaluate actual bids, market conditions, development timelines and changing technologies before making final resource decisions.

Sustainability

The preferred portfolio adds solar generation and our first energy storage resources while maintaining the firm generating capacity needed for reliable service. Although the portfolio was developed without specific emissions-reduction requirements or renewable energy targets, the least-cost modeling selected a diversified mix of solar, battery storage and natural gas generation.

UniSource will continue to evaluate renewable energy, storage and emerging technologies based on their contributions to reliability, affordability and environmental performance. Technologies evaluated in the 2026 IRP included pumped hydro storage, enhanced geothermal generation and advanced nuclear generation.

Developing More of Our Own Energy Resources

Today, about half of the energy we deliver to customers is purchased from other providers through the regional wholesale market. Although hedging and other strategies help mitigate risk and manage costs, significant reliance on purchased power can expose customers to regional shortages and rising market prices.

The preferred portfolio would more than double the capacity of UniSource’s current energy resources. Developing additional natural gas, solar and energy storage resources will give the company greater control over the energy needed to serve customers while reducing exposure to higher-cost market purchases during periods of peak demand.

Progress Since the 2023 IRP

Since our last Integrated Resource Plan, UniSource has continued advancing projects designed to strengthen reliability, diversify our resource portfolio and support growing customer needs.

Dandelion Energy Park is one example. In March 2026, UniSource entered into an agreement to purchase energy and capacity from the Dandelion Energy Park in Maricopa County.

The project will pair 140 MW of solar generation with 140 MW of four hour storage, providing 560 megawatt-hours of storage capability. The four-hour battery system will allow solar energy generated during the day to be stored and delivered during periods of higher customer demand. The project is expected to begin commercial operation in 2028.

Planning for Growth

The regions we serve continue to attract interest from potential large commercial and industrial customers.

The IRP’s base forecast is grounded in demonstrated needs and realistic assumptions. Prospective large customers are added to the forecast only when they are contractually committed or have reached a stage at which service is considered sufficiently certain. This approach allows for responsible planning without assuming that every proposed project will move forward.

A foundational principle is that growth should pay for growth. New customers and additional energy demand should appropriately support the generation, transmission and other infrastructure needed to serve them without shifting unnecessary costs or reliability risks to existing customers.

UniSource also evaluated two higher-growth portfolios that assumed an additional 150 MW of high-load-factor demand beginning in 2030. The analysis showed that higher energy sales can spread fixed system costs across a larger sales base, potentially lowering the average system cost per kilowatt-hour even when additional resources are required.

Integrated resource planning is an ongoing process. We file updated IRPs every three years to reflect changing customer needs, energy technologies, market conditions and stakeholder input.