Wyoming Is Perfect For Data Centers, So Why Do They Cluster Only In Cheyenne?

Interstate 80 stretches 2,919 miles from New Jersey on the East Coast to California on the West. That’s made it a superhighway, carrying tons of goods across America from one coast to the other, and bringing along hundreds of logistics hubs or warehouses all along the way.

But it’s not just a superhighway when it comes to transporting goods across the nation. It has also become an information superhighway, too. In the past year, $24 billion in data centers were announced across 15 projects, all somewhere along I-80, according to Site Selections’ Conway Project Database, a global database of corporate facility expansion projects.

Part of the reason for that is a major transcontinental fiber line that is co-located along Union Pacific rights of way, as well as along I-80. But the trend does have a very noticeable gap when it comes to Wyoming.

While Cheyenne has attracted a healthy cluster of eight of the state’s 11 data centers, including Microsoft and soon Meta, there aren’t any notable data center clusters along I-80 after that, and they don’t really pick back up again until Utah.

It’s not because the transcontinental fiber line stops at Cheyenne. It doesn’t.

“We tend to think of data centers as needing really good connection to fiber and being able to send information along a fiber trunk,” Wyoming Business Council Executive Director Josh Dorrell told Cowboy State Daily. “That’s definitely an important thing. But there’s one other element that data centers need that’s very important, and it’s pretty much absent everywhere else except Cheyenne along I-80, and that is power.”

The capacity for power outside of Cheyenne along I-80 has so far been lacking, Dorrell said. 

That’s not just an issue along I-80, he added.

“Many, many parts of the state face this,” Dorrell said. “But especially along I-80, where you would think that there is a good fiber trunk, and there’s a good way to get information down that pipe. There’s no way to power it, so that is the challenge.”

Black Hills Energy Power

Dorrell and other community leaders in Cheyenne credited Black Hills Energy with being particularly proactive when it comes to providing power for data centers in the state’s capitol.

“When Microsoft came to town, their footprint was much smaller than it is today, and they have just continued to expand,” Dorrell said. “And I think the Meta project is planning to be a pretty good-sized project. I would guess they’re looking to increase that footprint over time, and so, one of the keys there has been a great relationship with Black Hills Energy in the city and how they work together.”

Cheyenne residents Gary New and Randy Bruns were among those involved in helping to bring Wyoming’s first supercomputing center — the National Center for Atmospheric Research or NCAR, which helped pave the way for the subsequent Microsoft datacenter. 

Bruns, who was Cheyenne LEADS CEO at the time, said Microsoft executives were impressed with the enthusiasm of both the area’s power provider at the time, which was Black Hills Energy’s predecessor, Cheyenne Power and Light, and its governing officials. 

“They said, whenever we approach someone about an excessively large load or a new concept, the answer is usually, ’No,’” Bruns recalled. “And then we have to start from there and start to build a relationship and see if there’s really some way to get to, ‘Well maybe.’

“But they said the answer here, not just from the power company, but even from governing officials was, ‘Well, we’ve never done that, or we’ve never encountered that, but tell us more.’”

Black Hills Energy told Cowboy State Daily in an email that their early efforts to accommodate Microsoft ultimately required a new kind of power contract. It had to be designed differently, to shield regular power customers from the cost impact of standing up so much additional power capacity.

“This approach helped us establish our Large Power Contract Service (LPCS) a first-of-its-kind tariff implemented in 2016,” Black Hills Energy Development Manager Austin Allen told Cowboy State Daily in an email. “(That) allows us to provide market and renewable energy options to data centers without impacting retail rates. Other utilities across the nation look to our model as a best practice.”

Allen said he believes other areas along I80 in Wyoming could be ideal for data center development, given the critical energy and transmission infrastructure, fiber connectivity, favorable climate conditions, and potential for strong community partnerships. 

The company declined an interview with Cowboy State Daily for more specifics about the topic.

Power Providers Elsewhere

The area past Cheyenne is served by different utility companies, including Western Area Power Administration and Rocky Mountain Power (RMP). The latter serves most of the communities along I-80, with Rawlins, Rock Springs, Green River and Evanston all shown in RMP’s service area map online.

Rocky Mountain Power has recently added some wording around large contract users that couldaccommodate data centers. That was discussed and approved by the Wyoming Public Service Commission during its most recent rate case. Whether that heralds new data centers along I-80 isn’t clear. The company didn’t have a direct response to that question from Cowboy State Daily.

“Generally speaking, when a customer has a large load request, they will contact the company and Rocky Mountain Power will work closely with that customer to ensure adequate system reliability,” the company said in an email. “The company has these processes to help large load customer meet their goals while ensuring that costs are not spread to other customers.”

Asked about the reason for the lack of data centers in its service area along I-80, the company told Cowboy State Daily in an email, “Extremely large load requests, generally considered 75 Megawatts or greater, often require significant levels of transmission and generation infrastructure to support their loads regardless of their geographic location. This includes data centers, among other industries.”

The company declined an interview on the topic to discuss the issues more directly. 

Carbon County Hasn’t Been Taking Calls From Data Centers

Data Centers so far haven’t been knocking on Carbon County’s door, looking to locate along I-80, according to Carbon County Economic Development Executive Director Yvonne Johnson. 

Johnson said she thought the area had some advantages for data centers, if they did choose to locate in Carbon County, but she felt most of them were looking to places like Cheyenne and Laramie.

“In some ways I am kind of surprised no one has been really seeking out Carbon County for a data center,” she said. “Given that we’re right at the corner of the 287 bypass as well as smack middle on I-80. And we’re like the leading industry sector in the state as far as wind power.”

There’s also a Workforce Center that could potentially help with training workforce in the future, if there was an interested data center in the future.

But, so far, data centers haven’t come calling, and they aren’t a topic that’s yet occupied much of her time. That’s partly due to the fact the county’s economic development program is in the midst of restructuring. It will soon be rolling out a new strategic plan, one that Johnson said would focus on business retention and expansion.

“We are looking heavily at, we will be pushing on building tax base and creating jobs,” she said. “Manufacturing is also a really big push in Wyoming right now.”

Cowboy State Daily also reached out to Sweetwater Economic Development, but did not receive a reply at the time of this article’s posting.

Redundancy Is Another Key

One of the issues for areas outside of Cheyenne could be not enough redundancy, Bruns told Cowboy State Daily.

“It’s not just being on the transcontinental fiber,” he said. “But it’s also where that fiber intersects.”

Data centers want to know that if the main route to Chicago is interrupted, for example, that there’s an alternate route to get data where it’s going. And the same is true for power. 

“It isn’t just that we have a lot of power from one source,” Bruns said. “But if that source goes down … can that data center continue to operate from another source? And when you’re talking about that scale of power requirements, it’s not an easy answer.”

That was one way in which Cheyenne proved fortunate, Bruns said, when it first started trying to attract data centers back in the early 2000s.

“We learned we were sitting in a position where we had redundancy of resources that we had no idea was even here,” he said. “We just sort of stumbled on that, in large part because of our work with NCAR.”

Successfully placing NCAR within the state of Wyoming highlighted that much of what data centers would need was right here in Wyoming. And it led to a sea change in economic development opportunities for Cheyenne, Bruns added.

It did take some additional construction to close certain data and power loops to create enough redundancy for NCAR, and then later, Microsoft, New added. He was formerly NCAR’s operations manager.

“The loop between Colorado and Wyoming is called the Bison Network,” he said. “And it comes up by (I-25) and goes over to Laramie and then it goes down to (U.S. 287). We also found out there was fiber that went from Cheyenne over by Horse Creek.”

Extending that created the all-around redundancies NCAR needed to assure there should never be any downtime.

“It’s millions of dollars per second for large data centers to be down,” Bruns said. “They can’t be down. So, they’ve got to have robust connectivity from diverse directions.”

The cluster of needs for data centers is something New refers to as a four-legged stool. 

“It’s space, power, cooling and network,” New said. “You have to have the space to expand, the power to meet your needs and expand, and the network for your needs that can expand.”

Only when all four things are present can data centers economically develop along I-80 in Wyoming, New said.

Renée Jean can be reached at renee@cowboystatedaily.com.