Data Centers in Fargo
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Fargo – Low-Cost, Low-Risk Midwest Colocation
Fargo offers a compelling data center market for organizations prioritizing operational cost savings and low environmental risk. It is an excellent location for secondary disaster recovery sites, backup infrastructure, and latency-tolerant applications that benefit from some of the lowest power and tax rates in the country. This market allows businesses to reduce total cost of ownership significantly while ensuring high uptime.
Fargo: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity, though fewer long-haul fiber options than major hubs. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest major cloud hub is Minneapolis; private connectivity options available. |
| Power Cost | $0.08/kWh – as of May 2025 | Significantly below the U.S. national average, offering major operational savings. |
| Disaster Risk | Moderate (71.78) – as of September 2025 | Primary risks are weather-related; no seismic or coastal flood exposure. |
| Tax Incentives | Yes | Includes sales and use tax exemptions for qualified data center equipment. |
| Sales Tax | 5.00% – as of September 2025 | North Dakota state base rate, creating a favorable purchasing environment. |
Network & Connectivity Ecosystem
The connectivity landscape in Fargo is focused and best suited for regional workloads. While it is not a primary interconnection hub, it provides reliable network access for businesses serving the Upper Midwest.
Carrier Density & Carrier Neutrality The market has a focused carrier presence, with at least 1 provider offering services as of September 2025. The two facilities provide carrier-neutral interconnection options, ensuring competitive and resilient network design.
Direct Cloud On-Ramps There are no direct cloud on-ramps within Fargo as of September 2025. Access to hyperscale clouds like AWS, Google Cloud (GCP), and Microsoft Azure is typically achieved via network extensions to the nearest major hub, Minneapolis.
Internet Exchange Points (IXPs) Public peering is not established in Fargo. Most network peering is handled privately or routed through interconnection facilities in Minneapolis, the primary regional traffic hub.
Bare Metal Bare metal server options are available in the region, often deployed to serve local application needs. Providers such as ColoCrossing can service deployments in secondary markets like Fargo.
Power Analysis
Fargo stands out for its exceptionally low power costs and stable energy infrastructure, making it a prime location for power-intensive computing.
Average Cost Of Power Industrial power costs average $0.08/kWh as of May 2025, placing Fargo among the most affordable markets in North America. This low rate directly reduces operational expenditures for colocation and large-scale deployments. The grid mix is primarily composed of coal (55%) and wind (36%).
Power Grid Reliability The regional power grid is well-engineered and reliable, supporting the uptime requirements of modern data center operations. The infrastructure is built to withstand local weather conditions, providing a stable power foundation for critical IT assets.
Market Access, Business & Tax Climate
Fargo provides a supportive business environment with strong tax incentives and strategic access to regional markets.
Proximity To Key Business Districts Data centers in Fargo serve the city's growing technology, healthcare, and logistics sectors. Their location provides low-latency connectivity for local enterprises and institutions that form the backbone of the regional economy.
Regional Market Reach From Fargo, organizations can effectively serve end-users across North Dakota, South Dakota, and western Minnesota. It is a strategic digital outpost for companies requiring a presence in the Northern Plains states.
Tax Advantage For Data Centers North Dakota offers significant tax incentives, including a sales and use tax exemption for qualified data center equipment, software, and construction materials. This program substantially lowers the upfront capital investment required for building or expanding a data center footprint.
Natural Disaster Risk
Fargo has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 71.78 as of September 2025. The location is free from seismic, hurricane, and coastal flooding threats, with primary risks being atmospheric and weather-related.
Key risks include tornado, strong wind, winter weather, ice storms, and cold waves. Infrastructure in the region is engineered to mitigate these specific environmental challenges, contributing to a reliable operational environment.
