Data Centers in Billings

Billings – Low Operating Costs and Regional Resilience

Executive Summary

Billings serves as a vital secondary site hub for enterprises requiring low-cost operations and regional resilience in the Northern Rockies. The combination of zero sales tax and a stable, renewable-heavy power grid makes it an excellent choice for mission-critical disaster recovery and secure data sovereignty.

Billings: At A Glance

Network & Connectivity Ecosystem

Billings provides essential transit between major coastal hubs and regional High Plains markets, functioning as a reliable interconnection point. All metrics are current as of September 2025.

Carrier Density & Carrier Neutrality: Carrier count: around 5 to 10 providers. The market features a mix of regional specialists and national transport providers, ensuring competitive options for local enterprise and colocation tenants.

Direct Cloud On-Ramps: Over 0, enabling access to 0 cloud regions. There are currently no direct on-ramps for AWS, Google Cloud (GCP), or Microsoft Azure within the city. Denver serves as the nearest primary hub for direct cloud interconnection via private wave or PNI extensions.

Internet Exchange Points (IXPs): The Yellowstone Regional Internet Exchange (YRIX) serves as the primary local peering point, reducing latency for regional traffic by keeping data local.

Bare Metal: High-performance compute requirements are supported by regional providers, with options for dedicated hardware available through firms like phoenixNAP or Latitude.sh.

Power Analysis

Energy stability and cost remain the primary drivers for infrastructure investment in the Billings area.

Average Cost Of Power: Industrial electricity rates range from $0.05/kWh to $0.07/kWh, as of September 2025. These low costs provide a massive advantage for traditional colocation and high-density workloads. The energy mix is significantly green, with 57% derived from low-carbon and renewable sources.

Power Grid Reliability: The local grid is reliable and built to support heavy industrial loads, including refineries and manufacturing. Data center corridors benefit from redundant transmission lines and multi-substation support.

Market Access, Business & Tax Climate

Billings provides a business-friendly environment characterized by low taxes and proximity to key regional industries.

Proximity To Key Business Districts: Data centers are centrally located to serve the healthcare, energy, and financial services sectors that dominate the Billings economy. This proximity ensures low-latency access for local headquarters and remote operations.

Regional Market Reach: As the largest city in Montana, Billings is the logistical and digital gateway for the state, as well as northern Wyoming and the western Dakotas.

Tax Advantage For Data Centers: The state provides a financial edge through a 0% sales tax on all equipment and services. Additionally, local property tax abatements specifically for data center investments can reduce the taxable value of new facilities by up to 75%.

Natural Disaster Risk

Billings carries a Moderate (59.12/100) disaster risk score according to FEMA data as of September 2025. The region is well-protected from many coastal and seismic threats common in other tech hubs.

The primary natural hazards include:

• Cold Wave: Significant winter temperature drops requiring specific HVAC management.
• Wildfire: Regional risk that can impact air quality and outdoor equipment.
• Hail: Frequent storm activity during spring and summer months.
• Winter Weather: Regular snowfall necessitates reliable site access and snow removal protocols.
• Lightning: Common during seasonal thunderstorms, requiring sturdy surge protection.

Other risks like earthquakes and river flooding are considered minor or localized to specific areas. Lower scores in these categories contribute to the suitability of the area for secondary data sites.