Data Centers in Modesto
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Modesto – Central Valley Digital Outpost
Modesto serves as a strategic secondary market for businesses needing a presence in California's Central Valley or a cost-effective disaster recovery site for Bay Area operations. It provides a viable alternative to the high costs and seismic risks of coastal hubs. This market is well-suited for agriculture, logistics, and regional enterprises requiring reliable infrastructure without the expense of a primary metro.
Modesto: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity; limited long-haul fiber diversity compared to primary markets. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest on-ramps are in the San Francisco Bay Area; private extension is possible. |
| Power Cost | $0.18 - $0.22/kWh | Price is an estimate for industrial use as of September 2025. |
| Disaster Risk | High (NRI Score: 89.02) | Significant earthquake, drought, and heat wave risk must be mitigated. |
| Tax Incentives | Yes | California offers energy efficiency rebates and data center-specific incentives in certain markets. |
| Sales Tax | 7.25% (State) | California state sales tax, as of July 2025. Local taxes may apply. |
Network & Connectivity Ecosystem
Modesto is a small but functional connectivity market, primarily serving local and regional needs.
Carrier Density & Carrier Neutrality The market includes 2 main providers, as of September 2025. The ecosystem is focused on regional last-mile and transit services rather than extensive long-haul options. Carrier-neutral facilities provide essential access to these networks.
Direct Cloud On-Ramps There are 0 direct cloud on-ramps located in Modesto, enabling access to 0 cloud regions locally. Businesses connect to cloud providers like AWS, Google Cloud (GCP), and Microsoft Azure through network extensions to facilities in the San Francisco Bay Area, particularly San Jose and Santa Clara.
Internet Exchange Points (IXPs) There are no major public internet exchanges within Modesto. Most peering is handled privately or occurs by connecting to the primary exchange points in the Bay Area.
Bare Metal Bare metal server capacity is available, typically provided by national providers with a presence in secondary markets. Options from providers like Hivelocity can serve workloads that require dedicated physical hardware.
Power Analysis
Power in Modesto reflects California's broader energy landscape, with a focus on a diverse generation mix and higher-than-average costs.
Average Cost Of Power Industrial power costs are estimated to be between $0.18 and $0.22/kWh, as of September 2025. While higher than the U.S. national average, these rates are competitive for California and significantly lower than in the core Bay Area market.
Power Grid Reliability The power grid is generally stable and sufficient for commercial and industrial use. As in any market, mission-critical data centers rely on their own N+1 or 2N redundant UPS systems and on-site generators to guarantee uptime during utility outages.
Market Access, Business & Tax Climate
Modesto's location provides a key logistical and economic advantage for specific industries.
Proximity To Key Business Districts Data centers in Modesto are positioned to support the Central Valley's massive agricultural and logistics sectors. Proximity to these industries allows for low-latency processing for supply chain management and agricultural technology (AgriTech) applications.
Regional Market Reach The market effectively serves the San Joaquin Valley, including population centers like Stockton and Fresno. It acts as a digital hub for a region critical to California's economy but geographically distinct from the coastal metropolitan areas.
Tax Advantage For Data Centers California provides various tax incentives, including state-wide rebates for energy efficiency and programs like ENERGY STAR certification. While some of the most aggressive data-center-specific programs are focused on Silicon Valley, general incentives can help lower operational costs for qualifying facilities in Modesto.
Natural Disaster Risk
Modesto has a high natural disaster risk profile, with a FEMA National Risk Index score of 89.02 out of 100, as of September 2025. This score reflects the combined threat from multiple potential hazards.
Key risks for data center planning and mitigation include:
- Earthquake: Significant seismic risk due to proximity to several fault systems.
- Drought: High probability of prolonged drought, impacting water resources for cooling.
- Heat Wave: Frequent and intense heat waves place stress on cooling systems and the power grid.
- Wildfire: Regional wildfire risk can impact air quality and pose a threat to infrastructure.
- Riverine Flooding: Proximity to the Tuolumne and San Joaquin rivers creates localized flood risk.
