Data Centers in Albert Lea
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Albert Lea – Low-Cost, Low-Risk Midwest Edge
Executive Summary
Albert Lea, Minnesota, is a compelling edge market for organizations prioritizing low operational costs and minimal environmental risk. It is an excellent choice for disaster recovery sites, data archiving, and latency-tolerant applications that benefit from Minnesota's attractive tax incentives and affordable power. This market ensures stable, secure colocation without the high costs of a primary data center hub.
Albert Lea: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid connectivity for a secondary market, suitable for regional workloads. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest cloud access is in Minneapolis; connect via PNI or wavelength services. |
| Power Cost | $0.08/kWh – as of 2021 | Very competitive industrial power rates significantly reduce operational expenses. |
| Disaster Risk | Low (Score: 24.66) – as of September 2025 | Very low exposure to major natural disasters, enhancing infrastructure uptime. |
| Tax Incentives | Yes | State-level sales tax exemptions are available for qualifying data center equipment. |
| Sales Tax | 6.875% – as of mid-2025 | Minnesota offers specific tax relief programs for data center investments. |
Network & Connectivity Ecosystem
Albert Lea serves as a strategic point for regional connectivity, offering a focused and reliable network environment.
Carrier Density & Carrier Neutrality: The market contains 1 provider as of September 2025. This provides sufficient carrier access for local and regional business requirements, though direct network expansion requires connecting to hubs in Minneapolis.
Direct Cloud On-Ramps: There are no direct cloud on-ramps within Albert Lea as of September 2025. Businesses access major cloud providers like AWS, Google Cloud, and Microsoft Azure through private network extensions to interconnection hubs in Minneapolis.
Internet Exchange Points (IXPs): Public peering is not available directly in Albert Lea. The primary peering ecosystem for the region is located in Minneapolis, where most network traffic is exchanged.
Bare Metal: Bare metal server options are available, enabling businesses to deploy dedicated compute capacity. Providers like ColoCrossing can service deployments in regional markets, offering customized hardware solutions.
Power Analysis
Minnesota’s power infrastructure provides a cost-effective and dependable foundation for data center operations.
Average Cost Of Power: The average industrial electricity rate is approximately $0.08/kWh as of 2021. This competitive pricing provides a significant cost advantage for compute-heavy operations compared to many other US markets.
Power Grid Reliability: The regional power grid is well-engineered and stable, with infrastructure designed to support industrial and agricultural operations. Data centers in the area benefit from reliable energy delivery typical of established US utility providers.
Market Access, Business & Tax Climate
Albert Lea's strategic location and favorable tax policies make it an attractive environment for data center investment.
Proximity To Key Business Districts: The market effectively serves businesses throughout Southern Minnesota and Northern Iowa. It is well-positioned to support key regional industries, including agriculture, manufacturing, and logistics.
Regional Market Reach: From Albert Lea, organizations can achieve low-latency connectivity to the major business hub of Minneapolis-St. Paul, serving a population of several million people with reliable digital services.
Tax Advantage For Data Centers: Minnesota provides a significant sales tax exemption for qualifying data centers on IT equipment, software, and electricity. This incentive substantially lowers the upfront capital investment and ongoing operational costs for new and expanding facilities.
Natural Disaster Risk
Albert Lea has a very low natural disaster risk profile, safeguarding critical infrastructure investments and ensuring high levels of uptime.
The region has a FEMA National Risk Index score of 24.66 out of 100, categorized as "Very Low" as of September 2025. The primary environmental risks are atmospheric and seasonal, including tornados, strong wind events, winter weather, and hail. The area has minimal exposure to seismic, wildfire, or hurricane-related events.
