Data Centers in Colorado

Colorado – Central US Hub for Resilient Infrastructure

Colorado is a primary data center market for enterprises that require a strategic central location to serve both U.S. coasts with low latency. Its combination of competitive power costs, a favorable disaster risk profile, and direct cloud access makes it a superior choice for production workloads and disaster recovery sites. This market provides a reliable platform for securing digital assets and ensuring consistent application performance nationwide.

Colorado: At A Glance

Network & Connectivity Ecosystem

Colorado, particularly the Denver metro area, is one of the most connected markets in the Mountain West. Its location makes it a natural intersection for long-haul fiber routes connecting the East and West coasts.

Carrier Density & Carrier Neutrality: The state features a healthy ecosystem of over 45 network providers as of September 2025. Carrier-neutral facilities in hubs like Denver provide extensive choice for creating redundant, high-performance network architectures.

Direct Cloud On-Ramps: With over 2 dedicated cloud on-ramps, Colorado enables low-latency access to 13 cloud regions as of September 2025. Direct, private connectivity is available to major platforms including AWS, Microsoft Azure, and IBM Cloud, bypassing the public internet for better security and performance.

Internet Exchange Points (IXPs): The primary public peering point is the Denver IX, which facilitates efficient, low-cost traffic exchange between local and regional networks. Most large-scale peering is handled privately within the region's major data centers.

Bare Metal: Bare metal cloud solutions are readily available from multiple providers. This allows businesses to deploy dedicated servers for workloads requiring maximum performance and security, with providers like phoenixNAP offering services in the region.

Power Analysis

Colorado offers a reliable and competitively priced power grid, essential for supporting high-density computing and mission-critical operations.

Average Cost Of Power: Industrial electricity rates typically range from $0.07 to $0.09 per kWh as of September 2025. This competitive pricing structure provides a significant advantage for controlling the total cost of ownership for large-scale deployments. The power mix includes approximately 40% renewables, offering options for companies pursuing sustainability goals.

Power Grid Reliability: The power grid, especially within the Denver Tech Center and other commercial hubs, is well-engineered and stable. Major data center facilities are supported by redundant power feeds and multiple substations, ensuring high levels of uptime.

Market Access, Business & Tax Climate

Colorado's business environment is supported by a skilled workforce, a growing technology sector, and targeted incentives that reduce the cost of data center operations.

Proximity To Key Business Districts: Data centers are concentrated near the Denver Tech Center and the broader Denver-Aurora-Lakewood metropolitan area. This proximity provides low-latency connectivity for the region's prominent aerospace, telecommunications, financial services, and software industries.

Regional Market Reach: From its central location, Colorado serves as an ideal hub for reaching customers across the Mountain West, Midwest, and Southwest. It is a strategic point for disaster recovery infrastructure for businesses in California, Texas, and Illinois.

Tax Advantage For Data Centers: Colorado offers a significant state sales and use tax rebate on data center equipment purchases. This incentive directly lowers the capital expenditure required to build out or refresh server, storage, and networking hardware.

Natural Disaster Risk

Colorado has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 63.28 out of 100 as of September 2025. The state is not exposed to hurricanes, earthquakes, or coastal flooding, making it a safer alternative to many coastal data center markets.

The primary environmental risks to consider are Wildfire, Hail, Drought, Tornado, and significant Winter Weather events. Data center operators in the region mitigate these risks through site selection, hardened facility construction, and comprehensive business continuity planning.