Data Centers in District Of Columbia

District of Columbia – Strategic Federal & Enterprise Hub

Executive Summary

The District of Columbia is a critical digital infrastructure market for any organization that interacts with the U.S. federal government, including agencies, contractors, and regulated industries. While neighboring Northern Virginia handles massive hyperscale deployments, D.C. offers strategic colocation focused on proximity, low-latency connectivity to government networks, and high-security operations. This market ensures digital services remain performant and resilient in the nation's capital.

District of Columbia: At A Glance

Network & Connectivity Ecosystem

The District's connectivity is defined by its unique federal and commercial traffic. The ecosystem is smaller but denser than surrounding markets, purpose-built for government, finance, and enterprise users who require high-security, low-latency links within the Beltway.

Carrier Density & Carrier Neutrality: The market features access to over 15 carriers, as of September 2025. Carrier-neutral facilities provide resilient interconnection options, essential for government continuity and business operations.

Direct Cloud On-Ramps: Over 1 direct on-ramp provides access to 1 cloud region, as of September 2025. This includes dedicated connections to IBM Cloud, enabling hybrid cloud architectures for enterprises operating in the capital.

Internet Exchange Points (IXPs): Public peering is limited within the District itself. Most traffic exchange occurs via private network interconnects or through the massive peering exchanges in nearby Ashburn, Virginia.

Bare Metal: Bare metal server options are available from providers to support compute-intensive workloads that require dedicated, non-virtualized hardware. Providers like Hivelocity and phoenixNAP can serve the region.

Power Analysis

Average Cost Of Power: Industrial power rates average around $0.07/kWh, as of December 2024. This competitive price helps offset the higher real estate and operational costs typical of a major urban center. The local grid mix relies on imported electricity, primarily from natural gas and nuclear sources via the PJM Interconnection.

Power Grid Reliability: The power grid serving Washington, D.C. is well-engineered to support critical federal government infrastructure, offering strong reliability. Data centers in the area are typically supported by redundant power feeds and substation diversity to ensure high uptime for sensitive workloads.

Market Access, Business & Tax Climate

Proximity To Key Business Districts: Data centers in the District offer direct, low-latency connectivity to federal government agencies, lobbying firms, financial institutions, and the dense ecosystem of contractors located downtown. This proximity is a primary driver for colocation in the market.

Regional Market Reach: The market effectively serves the entire Washington D.C. metropolitan area, which includes parts of Maryland and Virginia. It acts as the core for a significant economic region of over 6 million people.

Tax Advantage For Data Centers: The District offers a significant tax incentive with its Strategic Investment Program (SIP). This program provides a 15-year tax abatement for qualifying data center campus developments, directly lowering long-term operational expenditures for new projects.

Natural Disaster Risk

Washington, D.C., has a High natural disaster risk profile, with a FEMA National Risk Index score of 91.57, as of September 2025. While a high score reflects the density and value of assets, operators must engineer facilities to mitigate specific threats.

Key risks include hurricanes, riverine flooding from the Potomac and Anacostia Rivers, strong winds, winter weather, and severe thunderstorms that can produce hail and tornadoes. Data center site selection and construction prioritize mitigating these known environmental hazards.