#United States #North Dakota #AI Data Center #LandGate #Bismarck

North Dakota: A New Powerhouse for AI Data Centers

As traditional data center locations encounter significant grid limitations, North Dakota is rising fast as a prime development area for artificial intelligence (AI) and high-performance computing. A recent analysis from LandGate, a business under Wood Mackenzie, highlights North Dakota's impressive potential to double its existing data center footprint.

A Booming Market for Development

The report titled North Dakota Data Centers: A State-Level Market Analysis reveals that the state is home to 15 operational data centers and has an additional 17 in the development pipeline. This ratio showcases North Dakota's robust market, outperforming neighboring states like Minnesota, Iowa, and Wyoming, making it an attractive choice for investors and developers alike.

Cost-Effective Energy Solutions

One of the driving forces behind this development surge is North Dakota's remarkably affordable power pricing. The state offers an average locational marginal price (LMP) of about $35 per megawatt-hour (MWh), which starkly compares to the national median of roughly $49/MWh. This cost advantage, along with the competitive pricing from surrounding markets, is critical for power-hungry data enterprise operations looking for cost-effective solutions.

Infrastructure and Grid Capacity

Infrastructure plays a crucial role in North Dakota's emergence as a data center hub. The region's substations boast significant available capacity for power off-take, which is increasingly becoming a focal point for data center siting decisions. Notable substations, such as those in Ellendale and Hankinson, offer over 1,000 MW of available capacity, paving the way for substantial projects in the area.

Major Projects in the Pipeline

The analysis outlines several influential projects set to capitalize on North Dakota's power advantages. This includes the Applied Digital's Polaris Forge 1 campus in Ellendale, which has a capacity of 400 MW; Critical Data House's 455 MW Fighting Pike campus in Williston; and another large-scale project from Applied Digital, a 430 MW facility in Oliver County. These projects represent a significant investment in North Dakota's technology landscape and provide a glimpse into a promising future for the region.

Co-Location Strategies

Another notable trend is the strategy of co-locating data centers near significant energy generation sources. Developers like Rainbow Energy are expanding their offerings near the 1,151 MW Coal Creek Station, providing a synergetic approach to energy efficiency and data operations. This strategy benefits from reduced cooling costs, as the naturally lower temperatures in North Dakota further minimize overhead expenses.

Economic Incentives Attractive to Investors

North Dakota's economic landscape also plays a crucial role in attracting AI infrastructure investment. The state offers substantial tax incentives, showcasing over $65 million in sales tax savings on qualifying data center setups in 2025 alone. Combined with its cold climate, which helps in controlling operational cooling costs, the state is presenting a very favorable environment for AI-centric businesses.

Craig Kaiser, President at LandGate, encapsulates the current climate perfectly: "Hyperscalers and AI developers are urgently seeking markets with available power headroom, rapid interconnection paths, and favorable operating economics. North Dakota delivers on all fronts, establishing itself as a crucial node for the next generation of high-density computing infrastructure."

For those interested in further exploration of North Dakota's market dynamics, the full North Dakota Data Center Market Analysis report is available for download through LandGate.

About LandGate

LandGate operates as the leading platform specializing in energy and infrastructure intelligence, focusing on the U.S. grid, power markets, and data center ecosystems. Their extensive data includes capacity mapping, nodal power pricing, and renewable energy projects, ensuring comprehensive insights for industry stakeholders.