Data Centers in Duluth
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Duluth, United States – Cost-Effective & Resilient Secondary Market
Duluth offers a compelling environment for businesses prioritizing operational stability and cost control. As a secondary market, it provides a low-risk, financially advantageous location for disaster recovery, backup, and latency-tolerant workloads. This market is ideal for organizations seeking to escape the high costs and physical risks of primary coastal hubs without sacrificing essential infrastructure.
Duluth: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity, suitable for diverse business applications. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Access is available via network extension to major hubs like Minneapolis or Chicago. |
| Power Cost | $0.08/kWh – as of 2021 | Competitive industrial power rates support cost-effective, high-density deployments. |
| Disaster Risk | Low – as of September 2025 | FEMA NRI score of 24.66 signifies minimal exposure to major natural disasters. |
| Tax Incentives | Yes | State-level sales tax exemptions are available for qualifying data center equipment and software. |
| Sales Tax | 6.875% – as of mid-2025 | Minnesota state sales tax rate. |
Network & Connectivity Ecosystem
Duluth's connectivity is built for regional resilience and reliability. While it is not a primary interconnection hub, it offers sufficient capacity for a wide range of enterprise and disaster recovery needs.
Carrier Density & Carrier Neutrality: The market is served by 2 primary providers across 2 data centers, as of September 2025. Carrier-neutral options ensure competitive network pricing and service diversity for customers.
Direct Cloud On-Ramps: There are 0 direct cloud on-ramps located in Duluth, as of September 2025. Secure, private connections to major cloud providers like AWS, Google Cloud, and Microsoft Azure are typically established via network extensions to nearby hubs such as Minneapolis.
Internet Exchange Points (IXPs): Public peering is not a central feature of this market. Most interconnection is handled privately between carriers or routed through major peering centers in Minneapolis or Chicago to ensure efficient traffic exchange.
Bare Metal: Bare metal server availability is consistent with a secondary market. Providers like ColoCrossing and Hivelocity can serve the region, offering dedicated compute for performance-sensitive applications.
Power Analysis
Duluth provides a favorable power environment characterized by competitive costs and a stable grid, making it an attractive location for energy-intensive computing.
Average Cost Of Power: Industrial electricity rates average around $0.08/kWh, as of 2021. This competitive pricing can significantly reduce total operating costs compared to more expensive primary data center markets.
Power Grid Reliability: The region's power infrastructure is well-engineered to support industrial needs. Data centers here benefit from reliable service, with facilities often fed by redundant power sources to maximize uptime.
Market Access, Business & Tax Climate
Duluth combines strategic location with a supportive business environment, offering financial advantages and solid regional market access.
Proximity To Key Business Districts: Data centers in Duluth serve the local healthcare, education, and port authority sectors. The market provides a capable hosting environment for businesses throughout Northern Minnesota and the Upper Midwest.
Regional Market Reach: From Duluth, organizations can effectively serve a broad geography encompassing Minnesota, Wisconsin, and Michigan's Upper Peninsula. It is an excellent location for disaster recovery sites for businesses based in the larger Minneapolis-St. Paul metropolitan area.
Tax Advantage For Data Centers: Minnesota offers significant sales tax exemptions on data center equipment, software, and electricity for qualifying facilities. This incentive directly lowers the capital and operational expense of establishing or expanding a data center presence, improving the return on investment.
Natural Disaster Risk
Duluth has a very low natural disaster risk profile, with a FEMA National Risk Index score of 24.66 out of 100, as of September 2025. This makes it an exceptionally secure location for critical infrastructure and data protection. The primary environmental risks are winter weather, strong winds, and wildfire.
