coordinate waking hours with lower temperatures
Having done a lot of field work west of Tucson last June, I know this is not true. We had to leave the hotel by 3:30am to get onsite at first light. The only tolerable temperature daylight hours for outside work were from 4:30 am to 11 am, although we managed to work until 2 pm. Daylight savings would have allowed us to sleep an extra hour, shifting the cooler morning daylight time toward waking hours.
Not observing DST helps to keep the air conditioning costs lower
This doesn't make sense either. Daylight savings means office hours are in cooler hours, not hotter. You are arriving at the office an hour earlier during cooler temperatures, and leaving the office an hour earlier at the hottest time of the day. Same effect for retail or other businesses. Swapping out a cooler start of the day hour for a scorching end of the day hour increases AC costs.
I'm pretty sure the reasons AZ is not on daylight time are pollical/religious, or simply no desire for more sunshine/daylight.
It's also unpleasant when tent camping at the Grand Canyon, sun wakes you up just after 4.