Data Centers in El Paso
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El Paso, Texas, USA – Strategic Edge for Border & Latam Access
El Paso is a key market for companies requiring low-latency connectivity to Northern Mexico and serving the logistics and manufacturing industries along the US-Mexico border. The market provides a cost-effective alternative to major Texas hubs, enabling reliable infrastructure deployment for regional and cross-border operations. Its strategic location is critical for applications where uptime and proximity to the international border directly impact supply chain efficiency and revenue.
El Paso, Texas, USA: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity with access to major long-haul fiber routes. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest on-ramps are in Dallas or Austin; access via private network extensions. |
| Power Cost | $0.06 – $0.08/kWh | Based on Texas's diverse grid mix, including significant natural gas and wind. |
| Disaster Risk | Moderate (43.46 NRI Score) | Primary risks include drought, heat wave, and hail; lower risk than coastal areas. |
| Tax Incentives | Yes | State sales and use tax exemptions are available for qualified data centers. |
| Sales Tax | 6.25% (State Rate) | The Texas state sales tax rate, as of Midyear 2025. |
Network & Connectivity Ecosystem
El Paso's connectivity ecosystem is defined by its strategic position on major fiber routes connecting the Western US, Texas, and Mexico.
Carrier Density & Carrier Neutrality: The El Paso market is served by over 6 unique network providers as of September 2025. Carrier-neutral facilities offer interconnection between these regional and national carriers.
Direct Cloud On-Ramps: There are no direct, in-market cloud on-ramps from major providers as of September 2025. Businesses connect to cloud regions by leveraging network providers to establish private connections to hubs like Dallas or Austin.
Internet Exchange Points (IXPs): Public peering is limited within El Paso. Most interconnection occurs privately within data centers or is routed through major exchange points in Dallas to achieve efficient traffic exchange.
Bare Metal: Bare metal server options are available, providing dedicated compute for performance-sensitive workloads. Providers like Hivelocity can serve the region, often deploying from nearby major hubs.
Power Analysis
El Paso benefits from the competitive and diverse Texas energy market, which includes a substantial and growing renewables portfolio.
Average Cost Of Power: Industrial power costs typically range from $0.06 to $0.08/kWh as of September 2025. This competitive pricing is driven by a grid powered primarily by natural gas (~50%) and wind (~25%), creating favorable operating economics for high-density deployments.
Power Grid Reliability: The power grid supporting El Paso is engineered for industrial use, with data centers typically located in areas with access to redundant power feeds. The state's energy infrastructure supports the high-availability demands of modern data centers.
Market Access, Business & Tax Climate
El Paso's business climate is heavily influenced by its role as a primary gateway for international trade and logistics.
Proximity To Key Business Districts: Data centers in El Paso provide low-latency connectivity to the city's central business district, international ports of entry, and extensive manufacturing and logistics parks. This proximity is vital for trade, transportation, and government sector operations.
Regional Market Reach: The market effectively serves a large binational region, including West Texas, Southern New Mexico, and the state of Chihuahua in Mexico. This makes it an ideal location for disaster recovery and content delivery for a population of several million people.
Tax Advantage For Data Centers: Texas provides a significant sales and use tax exemption on equipment, software, and power consumed by qualified data centers. This incentive directly reduces the capital and operational expenses associated with large-scale IT infrastructure investments.
Natural Disaster Risk
El Paso has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 43.46 as of September 2025. The area is not exposed to the hurricane or major seismic risks that affect other IT markets.
Key environmental risks for infrastructure planners include:
- Drought
- Heat Wave
- Hail
- Lightning
- Wildfire
- Winter Weather
