The five fastest-growing hubs for data center expansion include an interesting mix of urban areas that have one thing in common: lots of available power.
Based on projected data-center capacity growth, Las Vegas/Reno is the No. 1 fastest growing data center site in the US, followed by Salt Lake City, Phoenix, Atlanta, and Dallas-Fort Worth, according to a new report from cloud security vendor Upwind. Northern Virginia didn’t make the list – but that’s because it has grown so much that its rate of growth, by comparison, is lower.
We’re only at the start of the AI boom, so data center growth isn’t going to slow down anytime soon. The report notes that data centers are “an economic gold mine” and a boon for the local economy. Upwind says a typical data center injects about $243.5 million into the local economy, creating 1,688 construction jobs and sustaining 157 permanent roles. Once completed, data centers also contribute approximately $7.8 million annually in wages and add an average of $1.1 million in tax revenue every year.
No. 1: Las Vegas/Reno
Data center power capacity in Las Vegas/Reno is projected to grow by 953% over current levels to meet demand. At that level, Las Vegas and Reno’s data centers will require 3,812 MW of energy to operate – which is enough electricity to power 3.1 million homes. One significant factor behind data center growth in Las Vegas is the electricity rate, which is 35% lower than the national average. Nevada Energy, the largest utility company in the state, generates most of its power from renewable resources like geothermal, hydroelectric, and solar energy.
No. 2: Salt Lake City
Data center power capacity in Salt Lake City is projected to grow 699%, with potential future capacity expected to reach 1,271 MW. Salt Lake City is seeing a boom in data center growth, primarily due to Utah’s attractive tax incentives. Utah’s state government has been generous in offering tax incentives for new data center developments, attracting big companies like Meta and Google that can expand in the state at a cheaper cost.
No. 3: Phoenix
Phoenix is projected to see its data center capacity grow by 554%, resulting in future energy capacity of 5,340 MW—enough to power 4.4 million homes. Arizona relies more on natural gas and renewable energy sources like solar, which have lower production costs than traditional power sources.
No. 4: Atlanta
Atlanta is expected to grow capacity by 484% to 3,125 MW—enough to power about 2.6 million homes. Microsoft is investing in incredible $1.8 billion to the region for a massive data center upgrade spanning three facilities and consuming 324 MW. This will effectively double the size of the existing data center infrastructure in the city.
No. 5: Dallas-Fort Worth
Data center capacity is projected to grow by 355% in Dallas-Fort Worth, requiring up to 4,396 MW of energy — enough to power about 3.6 million homes. DFW also stands out for its affordability, ranking seventh among the top 20 metros in land costs for colocation data centers. By contrast, land in Boston is nearly twice as expensive, and in Silicon Valley, prices are 14 times higher than in DFW.
Northern Virginia is the data center capital
Considered the world’s largest data center hub, Northern Virginia continues to lead the U.S. data center industry, with future capacity expected to double that of its nearest competitor, Phoenix.
Here’s a measure of just how massive Northern Virginia is: Once all of the planned data centers are built and running at full capacity, they will have energy requirements equivalent to the amount of electricity needed to power 9.1 million households. That’s more than three times the number of homes in the entire state of Virginia and almost three times the electrical need of New York City.
The only thing that will slow down growth will be finding enough power. Virginia’s power supply must nearly double in the next 15 years to meet rising demand. Dominion Energy estimates that power demand in Virginia is expected to grow by 85% over the next decade and a half.
Source:: Network World