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Data Centers in District Of Columbia

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District of Columbia – Federal Hub for Digital Infrastructure

The District of Columbia serves as a critical digital infrastructure hub for government, public sector contractors, and enterprises requiring low-latency connectivity to federal agencies. Its strategic importance lies in providing secure, compliant colocation and interconnection within the nation's capital, directly supporting sensitive workloads and regulatory-driven applications. This market is ideal for organizations where proximity to government operations and robust network access are paramount.

District of Columbia: At A Glance

FactorRating / DataNotes
Global Connectivity GradeBStrong regional fiber; primary connectivity hub is nearby Ashburn, VA.
Direct Cloud On-RampsOver 1 – as of Sep 2025Direct access to IBM Cloud.
Power Cost$0.07/kWh (as of Dec 2024)Below the national average, powered by a mix of natural gas and nuclear.
Disaster RiskHigh (Score: 91.57)Significant risk from hurricane, storm, and flood events.
Tax IncentivesYesOffers a 15-year tax abatement for qualifying data center campus developers.
Sales Tax6.00% (as of Sep 2025)District of Columbia sales tax.

Network & Connectivity Ecosystem

The District of Columbia offers a solid connectivity ecosystem, though it is heavily complemented by the world-leading hub in nearby Northern Virginia.

Carrier Density & Carrier Neutrality: The market features access to over 15 network carriers (as of September 2025). Carrier-neutral facilities provide diverse options for redundancy and performance, connecting to major regional and national fiber routes.

Direct Cloud On-Ramps: There is 1 direct cloud on-ramp, enabling dedicated access to 1 cloud regions (as of September 2025). This includes a point of presence for IBM Cloud. Access to other major clouds like AWS, Google Cloud, and Azure is typically achieved via low-latency connections to the Ashburn, VA market.

Internet Exchange Points (IXPs): Public peering is limited within the District itself. Most organizations establish private peering or leverage the massive exchange points in Ashburn, VA, to achieve efficient traffic exchange and reduce transit costs.

Bare Metal: Bare metal server options are available, providing dedicated, high-performance computing resources. Providers such as Hivelocity and phoenixNAP can service the region, offering customized server configurations for demanding workloads.

Power Analysis

Washington D.C. provides reasonably priced and reliable power, supported by a robust regional grid.

Average Cost Of Power: Industrial power rates are approximately $0.07/kWh (as of Dec 2024), which is competitive and below the average for many major US metros. This favorable pricing helps reduce the total cost of ownership for colocation customers.

Power Grid Reliability: The grid, part of the PJM Interconnection, is well-engineered to support the critical needs of the federal government and surrounding businesses. Data centers in the area are served by redundant power feeds from multiple substations, ensuring high levels of uptime.

Market Access, Business & Tax Climate

The District's value is defined by its unique proximity to the U.S. federal government and the industries that support it.

Proximity To Key Business Districts: Data centers here offer extremely low-latency connections to federal government agencies, lobbying firms, and the dense ecosystem of technology and consulting contractors located downtown and in the surrounding area.

Regional Market Reach: While not a primary national hub like Ashburn, D.C. effectively serves the Mid-Atlantic region, including Baltimore and surrounding metropolitan areas, for latency-sensitive applications.

Tax Advantage For Data Centers: The District offers a significant incentive with a 15-year tax abatement for developers of data center campuses. This program makes large-scale development more financially viable, encouraging investment in the local digital economy.

Natural Disaster Risk

The District of Columbia has a High natural disaster risk profile, with a FEMA National Risk Index score of 91.57 (as of September 2025). The primary threats are atmospheric and water-related.

Key risks include hurricanes, riverine flooding, severe wind, tornados, winter weather, and lightning. While direct earthquake risk is lower than in other regions, it remains a consideration. Data center selection should prioritize facilities with proven flood mitigation and structural resilience against severe storms.

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