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Data Centers in Illinois

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Explore Markets in Illinois

Illinois, USA – Premier Midwest Colocation Hub

Illinois stands as a primary North American data center market, especially for enterprises requiring low-latency connections to financial exchanges and population centers. Its blend of extensive network infrastructure and strong state-level tax incentives provides a compelling advantage for deploying high-performance computing and business-critical applications. This market is built for businesses that cannot afford downtime or slow performance.

Illinois, USA: At A Glance

FactorRating / DataNotes
Global Connectivity GradeA+Elite national fiber crossroads with extensive long-haul and metro connectivity.
Direct Cloud On-RampsOver 7 – as of September 2025AWS, Azure, Google Cloud (GCP), IBM Cloud, Oracle.
Power Cost$0.08–$0.10/kWh (est.)Mix includes over 54% low-carbon sources, as of 2023.
Disaster RiskModerate (49.54)Major risks are primarily weather-related; seismic risk is present but lower.
Tax IncentivesYes – DC-specificIncludes exemptions on equipment and credits for construction wages and investment.
Sales Tax6.25% (State) – as of 2025Qualifying data centers may receive exemptions on IT equipment purchases.

Network & Connectivity Ecosystem

Illinois, particularly the Chicago area, is one of the most connected markets in the world. As a historic railway and telegraph hub, it evolved into a primary junction for national fiber optic routes, offering exceptional network performance and choice.

Carrier Density & Carrier Neutrality: With over 77 providers present, as of September 2025, the market offers deep carrier diversity. Businesses can connect with a wide range of national and regional networks in numerous carrier-neutral facilities.

Direct Cloud On-Ramps: Illinois provides direct, low-latency access to over 7 cloud on-ramps connecting to 16 distinct cloud regions, as of September 2025. Major providers include AWS, Google Cloud (GCP), Microsoft Azure, IBM Cloud, and Oracle Cloud, enabling reliable hybrid cloud architectures.

Internet Exchange Points (IXPs): The market is home to several major IXPs, including the Equinix Chicago campus, which facilitates massive traffic exchange. These exchanges allow networks to peer directly, reducing latency and transit costs for content, cloud, and application providers.

Bare Metal: Bare metal server providers are widely available throughout the region. Companies like Hivelocity and phoenixNAP offer dedicated server solutions for workloads requiring maximum performance and security.

Power Analysis

Illinois offers a competitive and increasingly clean power landscape suitable for dense data center deployments.

Average Cost Of Power: Industrial electricity rates are estimated between $0.08 and $0.10/kWh, as of September 2025. This competitive pricing helps manage the significant operational expense of power-hungry IT infrastructure. The grid mix features 54.89% low-carbon energy sources, as of 2023.

Power Grid Reliability: The power grid, particularly in the Chicago metro area, is well-engineered with significant redundancy. Major data center corridors are supported by multiple substations, ensuring high levels of uptime and service continuity.

Market Access, Business & Tax Climate

Illinois combines strategic location with business-friendly incentives, making it an attractive base for digital infrastructure.

Proximity To Key Business Districts: Data centers in the Chicago area provide low-latency connectivity to the city's central business district, a global financial center. This proximity is critical for financial services, trading firms, and enterprises headquartered downtown.

Regional Market Reach: From its central location, Illinois serves as a digital gateway to the entire Midwest and much of North America. It can effectively reach tens of millions of consumers and businesses within a few milliseconds of latency.

Tax Advantage For Data Centers: Illinois offers significant, data center-specific tax incentives. These programs provide exemptions on the purchase of computer equipment and offer tax credits for construction and investment, directly reducing both the capital and operational costs of running a data center.

Natural Disaster Risk

Illinois has a moderate natural disaster risk profile, with a FEMA NRI Score of 49.54 out of 100, as of September 2025. The primary risks are weather-related and manageable with standard infrastructure hardening and operational planning.

Key environmental risks include severe thunderstorms, tornadoes, winter storms, and river flooding. The state also has some exposure to earthquakes, drought, and heatwave events. The risk profile avoids major threats like hurricanes, wildfires, or widespread coastal flooding common to other regions.

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