If you live in Arizona long enough, somebody will eventually tell you we’re running out of water.
Usually right after that comes a picture of a bathtub ring around Lake Mead.
And yes, Arizona has a real water problem. The Colorado River is under enormous stress, groundwater isn’t an endless underground swimming pool, and keeping several million people supplied with water in a desert requires some serious planning.
But “Phoenix is running out of water” isn’t really the story.
The better question is:
Where does your water come from, how secure is that supply, and what are we going to have to spend to keep it that way?
Because the answer is very different in Tempe than it is in Buckeye. And even within the same city, two houses can have completely different water providers.
So here’s my attempt to make this understandable without requiring a degree in hydrology.
Jump to Your Area
Tempe | Phoenix | Chandler | Gilbert | Scottsdale | Mesa | Apache Junction | Queen Creek | San Tan Valley | Buckeye | Goodyear | North Phoenix / TSMC
First: Where Does Phoenix Metro’s Water Actually Come From?
There are basically five buckets.
Salt and Verde River Water
This is the water managed by Salt River Project — the system of rivers, reservoirs and canals most of us drive past without thinking much about it.
And yes, this is also the water we’re water skiing on at Saguaro Lake, paddle boarding at Canyon Lake and generally pretending we don’t live in the middle of a desert.
The system depends on rain and snow falling across Arizona’s Salt and Verde watersheds and stores that runoff in a network of reservoirs. SRP also maintains a large groundwater-well system as backup.
Current stability: Strong.
Next 5–10 years: Relatively stable, although not immune to drought and warming.
This isn’t an unlimited supply. Dry winters can force SRP to use more groundwater. But compared with the Colorado River, the system is locally managed, heavily engineered and surprisingly resilient.
Colorado River Water
This comes to Central Arizona through the Central Arizona Project — CAP.
This is the source you’ve been hearing the most about.
Beginning in 2027, Lower Basin Colorado River deliveries are being reduced significantly. Arizona will take a substantial share of those cuts.
Current stability: Fair, but weakening.
Next 5–10 years: Expect less water and more uncertainty, not more water.
That does not mean Phoenix loses 40% of its water and everybody starts showering at the gym.
Cities have different priority rights, stored supplies and backup sources. But if I were building a water portfolio today, I wouldn’t want all my eggs in the Colorado River basket.
Colorado River information from the Bureau of Reclamation
Groundwater
We pump it out of aquifers beneath us.
Groundwater is extremely useful as a backup supply. The problem comes when communities depend on pumping more water than nature puts back.
Current stability: Good for existing designated systems.
Long-term direction: Declining as a stand-alone growth strategy.
Groundwater isn’t disappearing tomorrow. But deeper wells, pumping costs, treatment and aquifer depletion make it a lousy place to put all of your future growth.
And this has already affected homebuilding: Arizona’s Assured Water Supply restrictions have limited approval of some new subdivisions that would rely primarily on groundwater, forcing developers and communities to secure renewable or alternative supplies before additional growth can move forward.
Phoenix AMA groundwater information from ADWR
Reclaimed and Purified Water
Here’s the water source that doesn’t get nearly as many scary headlines.
We use water, treat it and use it again.
Current stability: Excellent.
Next 5–10 years: Improving significantly.
Gilbert already reuses or recharges much of its reclaimed water. Phoenix and Scottsdale are investing heavily in advanced purification.
And unlike rainfall, wastewater actually increases as a community grows.
The problem isn’t finding this water.
The problem is paying for the treatment plants and pipes.
Remember that sentence. We’re coming back to it.
Stored and Imported Water
Arizona has spent decades putting water underground for later use, and communities including Queen Creek and Buckeye are buying groundwater rights outside the urban area and building systems to bring that water here.
This can provide a very dependable supply.
But let’s be clear: imported groundwater is still groundwater.
It’s a very large savings account, not a new rain cloud.
Does It Matter Who Provides Your Water?
Yes. But municipal water isn’t automatically good and private water isn’t automatically bad.
In much of the Valley, your city operates the water system. In other areas — especially Apache Junction, San Tan Valley, Buckeye and Goodyear — your water may come from a private company such as EPCOR, Liberty or Arizona Water Company.
Either way, the water has to meet the same drinking-water standards.
The bigger difference is how the system is run and paid for.
With municipal water, the city controls the utility and can coordinate water supply, growth, wastewater and infrastructure. There are no shareholders to pay, and rate increases go through the local government process.
But that doesn’t necessarily mean cheaper water. Cities still have to pay for new wells, treatment plants, pipelines and expensive new water supplies. Gilbert and Queen Creek are good examples of communities spending a lot now to prepare for future growth.
Private water companies are regulated by the Arizona Corporation Commission. Large companies can bring plenty of money and expertise to rapidly growing areas, but they’re also investor-owned businesses, and their rates include the cost of those investments.
So I wouldn’t choose a house based simply on whether the water company is public or private.
I’d ask:
- Where does the water come from?
- How secure is that supply?
- What needs to be built next?
- And who’s going to pay for it?
Because two houses five miles apart can have completely different answers.
The important question isn’t just, “What city am I buying in?”
It’s “Who provides the water to this house?”
How Arizona regulates private utilities | Arizona drinking-water standards
The Phoenix Metro Water Report Card
| Area | Current Supply | Future Supply | Homeowner Cost |
|---|---|---|---|
| Tempe | A | A | B |
| Phoenix | A | A | B |
| Chandler | A | A | B |
| Gilbert | A | A | D |
| Scottsdale | B | A | C |
| Mesa | B | B | B |
| Apache Junction Water District | A | B | B |
| Apache Junction – Arizona Water Co. | B | C | C |
| Queen Creek | B | A | D |
| San Tan Valley | B | B | C |
| Buckeye | C | B | D |
| Goodyear | B | B | C |
| North Phoenix / TSMC Growth Area | A | A | B |
How I’m Grading This
Current Supply looks at how reliable and diversified the water available today appears to be.
Future Supply looks at whether the community is adding water, storage, reuse, treatment capacity or other resilience for the next 5–10 years.
Homeowner Cost measures the pressure I see on residential water bills from new supplies, treatment plants, pipelines and other infrastructure. An A means relatively low pressure. A D means substantially more cost pressure.
Important: A bad cost grade does not necessarily mean bad water management. Gilbert and Queen Creek are good examples. They’re spending more partly because they’re solving future problems now.
These are not official government ratings. They’re my attempt to translate a lot of very complicated water planning into something useful for homeowners.
Tempe
Current Supply: A
Future Supply: A
Homeowner Cost: B
Tempe starts from a very good position. In a typical year about 87% of its water comes from the Salt/Verde system, giving it relatively little direct exposure to Colorado River shortages.
Tempe also stores water underground and maintains groundwater backup.
Rates increased in 2026, but the city’s overall water position remains one of the Valley’s stronger ones.
Bottom line: One of the better starting positions in Metro Phoenix.
Phoenix
Current Supply: A
Future Supply: A
Homeowner Cost: B
Phoenix gets roughly 60% of its water from the Salt and Verde rivers and about 40% from the Colorado River, with groundwater available as backup.
Phoenix has also spent heavily to connect previously separate parts of its water system. Its drought pipeline, for example, allows Salt/Verde water to reach parts of North Phoenix that historically relied more heavily on CAP water.
The city is expanding water storage, groundwater recovery and advanced purification.
The downside is pretty obvious: this stuff costs money.
Bottom line: Strong and diversified, but homeowners should expect continued investment in water infrastructure.
Chandler
Current Supply: A
Future Supply: A
Homeowner Cost: B
Chandler has what I like to see: Salt/Verde water, Colorado River water, groundwater backup and a substantial reclaimed-water system.
No single water source has to carry the entire load.
Bottom line: Diversification is Chandler’s biggest strength.
Gilbert
Current Supply: A
Future Supply: A
Homeowner Cost: D
Gilbert’s water portfolio is strong: roughly 40% Salt/Verde, 41% Colorado River, 15% reclaimed and recharged water, and only a small share from safe-yield groundwater.
Gilbert has also stored a tremendous amount of water underground and is building new wells and major treatment infrastructure.
And then there’s the bill.
Gilbert approved another significant residential water-rate increase for 2026 as part of its multiyear infrastructure program.
Bottom line: Excellent water planning. Homeowners are helping pay for it now.
Scottsdale
Current Supply: B
Future Supply: A
Homeowner Cost: C
Scottsdale’s obvious weakness is that roughly two-thirds of its water has historically come from the Colorado River.
Its strength is what it has done about that vulnerability.
Scottsdale has one of the Valley’s most aggressive water-recycling and recharge programs and has been storing water underground for decades.
Bottom line: More Colorado River exposure than I’d like, but some of the Valley’s best reuse infrastructure.
Mesa
Current Supply: B
Future Supply: B
Homeowner Cost: B
Mesa gets roughly 53% of its supply from the Colorado River, about 40% from the Salt and Verde rivers and the rest primarily from groundwater.
That gives Mesa more direct Colorado River exposure than Phoenix, Chandler, Gilbert or Tempe.
But Mesa also has water stored underground, treatment infrastructure and multiple sources, so this isn’t a “Mesa is running out of water” situation.
Bottom line: Reliable today, but Colorado River conditions matter more to Mesa than many residents probably realize.
Apache Junction
This one needs two report cards because Apache Junction has two very different water stories.
Apache Junction Water District
Current Supply: A
Future Supply: B
Homeowner Cost: B
The Water District has access to both Colorado River water and groundwater, plus backup connections.
It currently has considerably more annual CAP entitlement than it actually uses, giving the district some cushion as Colorado River reductions begin.
Bottom line: Better positioned than the words “fast-growing community on the edge of the desert” might make you think.
Arizona Water Company Service Area
Current Supply: B
Future Supply: C
Homeowner Cost: C
Other Apache Junction neighborhoods are served by privately owned Arizona Water Company, whose local system has historically relied more heavily on groundwater.
So don’t assume that an Apache Junction mailing address automatically means Apache Junction Water District water.
Bottom line: In AJ, check the actual provider before making assumptions about the water supply.
Queen Creek
Current Supply: B
Future Supply: A
Homeowner Cost: D
Queen Creek is one of the more interesting water stories in the Valley.
Rather than assuming local groundwater can support explosive growth forever, the town has spent heavily acquiring long-term water supplies from outside the immediate area.
The result should be a much more diversified future portfolio with considerably less dependence on local groundwater.
Unfortunately, water rights and pipelines apparently aren’t available on Amazon Prime.
Residents will help pay for those supplies and the infrastructure required to move them.
Bottom line: One of the Valley’s biggest improvements in future water security — purchased at considerable expense.
San Tan Valley
Current Supply: B
Future Supply: B
Homeowner Cost: C
San Tan Valley isn’t an incorporated city, which makes the water story a little harder to explain.
A large portion is served by privately owned EPCOR’s San Tan system, which has an Assured Water Supply designation.
So this is not a case where thousands of existing houses somehow don’t have a legitimate long-term water plan.
But San Tan Valley remains part of rapidly growing Pinal County, where long-term groundwater limitations are very real.
Bottom line: Know the exact utility and subdivision. “San Tan Valley” by itself doesn’t tell you enough.
Buckeye
Current Supply: C
Future Supply: B
Homeowner Cost: D
Buckeye may be the clearest example of a city whose future water position looks considerably better than its present one.
Today the city still relies heavily on groundwater, while state groundwater modeling has identified limits on how much projected future development that groundwater can support.
Buckeye is responding by acquiring imported groundwater, expanding reclaimed-water recharge, holding Colorado River rights and pursuing additional water sources.
That’s the right direction.
But it requires a tremendous amount of new infrastructure.
And not every Buckeye resident receives Buckeye municipal water. EPCOR and Arizona Water Company serve some areas.
Bottom line: Improving, but starting from one of the Valley’s more groundwater-dependent positions — and the transition won’t be cheap.
Goodyear
Current Supply: B
Future Supply: B
Homeowner Cost: C
Goodyear’s municipal system uses a combination of groundwater and Colorado River water, recharges water underground and uses reclaimed water as part of its long-term strategy.
But here’s another example of city limits not telling the whole story:
Much of Goodyear north of I-10 is served by private Liberty Utilities rather than the City of Goodyear.
Goodyear municipal customers are also in a multiyear utility-rate adjustment as the city pays for growth and infrastructure.
Bottom line: Solid planning, but check the provider and expect growth to keep putting pressure on infrastructure spending.
North Phoenix / TSMC Growth Area
Current Supply: A
Future Supply: A
Homeowner Cost: B
First, one clarification:
TSMC is not a data center. It manufactures semiconductors.
The enormous development area surrounding TSMC — including Halo Vista, NorthPark and related growth — is primarily being tied into the City of Phoenix water system.
Phoenix acquired additional water rights associated with development of the area and is building major water, wastewater and reuse infrastructure to support the growth.
TSMC itself also plans to recycle an increasingly large percentage of the water used inside its manufacturing operation.
Bottom line: Huge new demand, but attached to one of the Valley’s strongest municipal water systems and a major expansion of reuse infrastructure.
And Since Everyone Is Talking About Data Centers…
Data centers have become the new villain in practically every Arizona conversation about electricity and water.
There is a legitimate issue here. Some data-center cooling systems can use substantial amounts of water.
But “data centers use a lot of water” is about as useful as saying “cars use a lot of gas.”
What matters is which cooling technology is being used, whether potable or reclaimed water is involved, how much water is actually consumed rather than recycled, and who pays for the infrastructure.
For this report card, I’m deliberately leaving industrial and commercial demand out of the grades. That’s a much bigger rabbit hole deserving its own discussion.
So…Are We Running Out of Water?
That’s still the wrong question.
Phoenix Metro is going through a water transition.
Colorado River water: DOWN
Dependence on local groundwater: DOWN
Salt and Verde River water: RELATIVELY STABLE
Reclaimed and purified water: UP
Imported and stored water: UP
The cost of making all of this work: ALSO UP
And that’s the part homeowners should probably pay the most attention to.
I don’t see good evidence that established Phoenix-area communities are heading toward a future where you turn on the kitchen faucet and nothing happens.
I see plenty of evidence that maintaining reliable water for a growing desert metropolis is going to require billions of dollars in water rights, treatment plants, wells, pipelines, storage and recycling systems.
In other words:
Our water problem may show up on the utility bill long before it shows up at the faucet.
And if you’re buying a house — especially in Buckeye, Goodyear, Queen Creek, San Tan Valley or Apache Junction — add one more question to your due-diligence list:
Who actually provides water to this address?
Because increasingly, that’s a better question than simply asking what city the house is in.
Nice concise info on water situation in Metro Phx. And it is not as dire as many think. Thanks for providing.
Thanks Raj! Glad you found it helpful.