Data Centers in Montana

Montana – Low-Cost Power and Favorable Tax Climate

Executive Summary

Montana offers a compelling environment for data centers focused on cost control and operational stability. Its combination of extremely low power costs, zero sales tax, and specific property tax abatements makes it a strategic choice for workloads that are not hyper-sensitive to latency, such as data archiving, backup, and high-performance computing. This market provides a secure and financially advantageous platform for businesses to scale infrastructure without the premium costs of major coastal hubs.

Montana: At A Glance

Network & Connectivity Ecosystem

Carrier Density & Carrier Neutrality: Montana has a focused connectivity market with over 4 providers operating 10 data centers, as of September 2025. While not a major interconnection hub, the state offers carrier-neutral facilities that provide access to regional and national networks.

Direct Cloud On-Ramps: There are no direct cloud on-ramps within Montana, as of September 2025. Businesses connect to cloud providers like AWS, Google Cloud, and Microsoft Azure through network extensions to major hubs such as Denver or Seattle. Private network interconnects (PNI) and wavelength services are the standard methods for establishing reliable cloud access.

Internet Exchange Points (IXPs): Public peering is limited within the state. Most network interconnection occurs through private peering arrangements within local colocation facilities or is routed through major regional exchanges in cities like Denver.

Bare Metal: Bare metal server options are available, providing dedicated compute resources for performance-intensive applications. Providers such as Hivelocity offer services that can be deployed in the region.

Power Analysis

Average Cost Of Power: Montana features some of the lowest industrial electricity rates in the United States, ranging from $0.05 to $0.07 per kWh, as of September 2025. This significant cost advantage directly reduces the total cost of ownership for power-dense deployments. The state's power mix is 57% low-carbon and renewable sources.

Power Grid Reliability: The power grid is well-engineered to serve its industrial base. Data center operators can expect stable power, particularly when facilities are located near the state's significant hydroelectric generation sources along the Columbia River basin.

Market Access, Business & Tax Climate

Proximity To Key Business Districts: Data centers in Montana serve state government agencies, university research institutions, and a growing number of technology and bitcoin mining operations. Facilities are strategically located to support these key local industries.

Regional Market Reach: From Montana, digital services can effectively reach markets across the Mountain West and Pacific Northwest, providing a low-latency option for users in this expansive but less densely populated region.

Tax Advantage For Data Centers: Montana's tax climate is exceptionally favorable for data centers. The complete absence of a state sales tax provides immediate, substantial savings on all hardware and software purchases. Furthermore, specific legislation allows for property tax abatements that can reduce the taxable value of a data center by 50% to 75%.

Natural Disaster Risk

Montana has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 59.12, as of September 2025. The environment is geologically stable compared to coastal regions, but operators must plan for specific regional hazards.

Key risks include wildfire, drought, earthquake, hail, severe winter weather, and lightning. The risk from tornadoes and riverine flooding is present but less pronounced than in other parts of the country. Proper site selection and facility engineering are critical to mitigate these factors.