Data Centers in Midland
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Midland, Texas – Strategic Energy Hub Colocation
Executive Summary
Midland is a specialized market designed for the energy sector and regional enterprises operating in the Permian Basin. For companies requiring low-latency compute near industrial operations, Midland provides essential infrastructure that ensures uptime for critical applications driving exploration, production, and logistics. This market is a strong choice for edge deployments and disaster recovery sites outside of Texas's primary data center hubs.
Midland, Texas: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity, though not a primary national network intersection point. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest on-ramp hubs are in Dallas or Austin; private network extensions are available. |
| Power Cost | $0.07 - $0.09/kWh | Based on a grid with ~30% renewables and ~62% fossil fuels. |
| Disaster Risk | Moderate (43.46) – as of September 2025 | Main risks are environmental, including drought, heat waves, and winter weather. |
| Tax Incentives | Yes | State sales and use tax exemptions are available for qualified data center projects. |
| Sales Tax | 6.25% (Texas) – as of June 2025 | This is the state-level sales tax; local taxes may also apply. |
Network & Connectivity Ecosystem
Midland is an edge market with focused, reliable connectivity sufficient for regional business but does not compete with the density of major metro areas like Dallas.
Carrier Density & Carrier Neutrality The market has limited carrier density, with a single provider reported as of September 2025. Connectivity is primarily routed through larger regional hubs, making carrier-neutral facilities essential for accessing available networks.
Direct Cloud On-Ramps There are no direct cloud on-ramps within Midland as of September 2025. Businesses requiring dedicated cloud access must use private network connections, such as point-to-point circuits or wavelength services, to connect to providers in Dallas or Austin.
Internet Exchange Points (IXPs) Public peering is not a feature of this market. Interconnection is typically managed privately between carriers or through transit providers connecting back to major exchange points in Dallas.
Bare Metal Bare metal server availability is oriented towards edge and regional deployments. Providers like Hivelocity can deliver dedicated compute resources to support local processing needs.
Power Analysis
Average Cost Of Power Industrial electricity rates are competitive, generally falling within the $0.07 to $0.09/kWh range as of September 2025. The Texas grid mix is dominated by natural gas (~50%) and wind (~25%), offering a diverse energy profile. Stable power pricing helps maintain predictable operational expenses for compute-intensive workloads.
Power Grid Reliability The power grid, managed by ERCOT, is engineered to support heavy industrial loads typical of the region. Data centers in the area feature redundant power systems, including UPS and on-site generators, to protect against grid instability or outages.
Market Access, Business & Tax Climate
Proximity To Key Business Districts Data centers in Midland are strategically located to serve the Permian Basin, one of the world's most productive oil and gas fields. This proximity provides low-latency connectivity for process automation, geological data analysis, and IoT applications essential to the energy industry.
Regional Market Reach Midland effectively serves as a digital infrastructure hub for West Texas and southeastern New Mexico. It is an ideal location for edge computing deployments that support regional agriculture, logistics, and industrial operations far from primary data centers.
Tax Advantage For Data Centers Texas offers a compelling tax incentive program for qualifying data center operators and tenants. The state provides a 100% exemption from the state sales and use tax on business personal property required for data center operations, significantly lowering both initial capital investment and ongoing equipment refresh costs.
Natural Disaster Risk
Midland has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 43.46 out of 100 as of September 2025. The location is not prone to major seismic or coastal events, but it faces significant environmental and weather-related challenges.
Key risks include drought, extreme heat waves, hail, wildfires, and severe winter weather. Facility engineering and operational planning must account for these specific regional threats to ensure consistent uptime.
