Data Centers in Fargo
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Fargo – Stability and Resilience in the Red River Valley
Executive Summary
Fargo is a primary choice for organizations requiring a stable, secondary site for disaster recovery or a regional edge presence. By providing low utility rates and a favorable tax environment, the market ensures mission critical data remains accessible without the high overhead of tier one metros. It serves as a strategic gateway for the Upper Midwest, offering a reliable alternative to larger, more congested hubs.
Fargo: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Stable regional performance with low latency to Midwest hubs. |
| Direct Cloud On-Ramps | 0 – as of December 2025 | Primary access via Minneapolis hub extensions. |
| Power Cost | $0.08/kWh – as of May 2025 | Competitive rates supported by a diverse regional energy mix. |
| Disaster Risk | Moderate (71.78) – as of December 2025 | Seasonal weather and wind events are primary concerns. |
| Tax Incentives | Yes | Sales and use tax exemptions for qualified equipment. |
| Sales Tax | 5.00% – as of December 2025 | State base rate provides a cost effective environment. |
Network & Connectivity Ecosystem
Fargo serves as a critical junction for telecommunications in the Upper Midwest, providing reliable pathways to national traffic exchanges.
Carrier Density & Carrier Neutrality: Carrier count: over 10 as of December 2025. The market contains a mix of regional fiber operators and incumbent telecommunications providers, offering diverse routing for local and long haul traffic.
Direct Cloud On-Ramps: 0 as of December 2025, enabling access to 0 cloud regions. There are no native on-ramps for AWS or Google Cloud (GCP) located directly in the city. Minneapolis serves as the nearest primary on-ramp hub, reached via private transport or software defined networking.
Internet Exchange Points (IXPs): Public exchange options are limited, with 702 Communications facilitating local peering to optimize regional traffic. Most high volume peering occurs at national points in Minneapolis or Chicago.
Bare Metal: Resilient server options are available through providers such as phoenixNAP and Hivelocity, offering dedicated hardware for high performance workloads.
Power Analysis
Fargo benefits from regional energy policies that prioritize affordability and a diversifying generation portfolio.
Average Cost Of Power: Industrial electricity is priced at $0.08/kWh as of May 2025. The energy mix consists of 55% coal, 36% wind, and approximately 9% natural gas. These rates provide a clear advantage for power intensive operations compared to national averages.
Power Grid Reliability: The local grid is well-engineered and utilizes multi-substation support to maintain service during extreme weather. Regional utilities provide redundant feeds to primary industrial corridors to help prevent downtime.
Market Access, Business & Tax Climate
Fargo has developed into a technology and financial center, attracting companies that prioritize stability and a skilled workforce.
Proximity To Key Business Districts: Data centers are positioned to serve the healthcare, agriculture technology, and financial services sectors concentrated in the Red River Valley. This placement ensures low latency for the headquarters and operations centers of major regional employers.
Regional Market Reach: Fargo acts as the primary gateway for the Upper Midwest, effectively serving North Dakota, South Dakota, and Western Minnesota. It is a preferred site for organizations wanting to maintain a presence between the Minneapolis and Seattle corridors.
Tax Advantage For Data Centers: North Dakota offers a specific sales and use tax exemption for equipment and construction materials used in qualified facilities. This benefit reduces the total cost of ownership for hardware refreshes and facility expansions.
Natural Disaster Risk
The natural disaster risk for Fargo is Moderate (71.78) as of December 2025. While the overall score is balanced, the region experiences specific seasonal hazards that require resilient facility engineering.
The highest scoring natural hazards for the area include:
- Hail: Frequent during summer storm cycles.
- Tornadoes: Significant risk during the spring and summer months.
- Winter Weather: Frequent ice and heavy snow accumulation.
- Strong Winds: Consistent high velocity winds throughout the year.
- Heat Waves: Occasional extreme temperature spikes.
Facility operators in this market typically utilize reinforced structures and specialized HVAC configurations to manage these environmental factors. Other risks such as drought and lightning are present but considered minor for infrastructure operations.
