Data Centers in Red Oak
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Red Oak, Texas – DFW Power & Connectivity Hub
Red Oak serves as a key data center market for businesses that require a strong Dallas-Fort Worth presence with scalable power and network access. It provides an excellent alternative to the core Dallas market, balancing cost, connectivity, and robust infrastructure to support mission-critical applications and regional disaster recovery strategies.
Red Oak, Texas: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Strong regional hub with excellent fiber access to the Dallas network ecosystem. |
| Direct Cloud On-Ramps | 0 — as of September 2025 | Nearest on-ramp hub is Dallas; private network extensions are readily available. |
| Power Cost | $0.07 - $0.09/kWh | Competitive rates with a diverse grid featuring significant natural gas and wind generation. |
| Disaster Risk | Moderate (43.46) — as of September 2025 | Primary risks are weather-related; the location avoids major seismic or coastal threats. |
| Tax Incentives | Yes | State sales and use tax exemptions are available for qualified data centers. |
| Sales Tax | 6.25% (Texas) — as of September 2025 | Local taxes may also apply in addition to the statewide rate. |
Network & Connectivity Ecosystem
Red Oak benefits directly from its proximity to Dallas, one of the most connected cities in the United States. While the local market is concentrated, it offers high-performance access to the greater DFW network fabric.
Carrier Density & Carrier Neutrality The Red Oak market provides access to dozens of regional and national carriers, with 2 data centers available as of September 2025. Connectivity is typically managed through the primary data center operators, offering resilient links back to the dense interconnection hubs in Dallas.
Direct Cloud On-Ramps As of September 2025, there are no direct public cloud on-ramps located within Red Oak. Businesses achieve secure, low-latency cloud access via dedicated private network connections to the major cloud providers located in nearby Dallas.
Internet Exchange Points (IXPs) Public peering is not established directly in Red Oak. Most peering occurs through private connections or at major exchanges in Dallas, ensuring efficient traffic exchange across the region and nationally.
Bare Metal Bare metal server options are available, giving businesses dedicated physical compute without managing their own hardware. Providers like Hivelocity offer solutions that serve the entire Dallas-Fort Worth metropolitan area.
Power Analysis
Red Oak is part of the ERCOT grid, which features a diverse and growing energy portfolio. The area is engineered to support the high-density power requirements of modern data centers.
Average Cost Of Power Industrial power costs in the Red Oak area typically range from $0.07 to $0.09/kWh, as of September 2025. These competitive rates, combined with Texas's diverse energy mix of natural gas and renewables, create a favorable operating environment.
Power Grid Reliability The power infrastructure supporting Red Oak's data centers is well-engineered. Facilities are supplied by multiple substations and feature extensive on-site N+1 or 2N UPS systems and backup generator capacity to ensure uptime during grid disturbances.
Market Access, Business & Tax Climate
Red Oak’s location south of Dallas makes it an ideal site for production and disaster recovery workloads supporting the massive DFW economy.
Proximity To Key Business Districts Data centers in Red Oak provide low-latency connectivity to the commercial centers of Dallas and Fort Worth. This supports key industries including finance, logistics, healthcare, and corporate enterprise headquarters throughout the metroplex.
Regional Market Reach The market is perfectly positioned to serve the 30 million people across Texas and the broader South-Central United States. Its central location also makes it a strategic hub for national data distribution and disaster recovery for coastal cities like Houston.
Tax Advantage For Data Centers Texas offers significant tax benefits that lower the total cost of operation for data center customers. A state sales and use tax exemption on equipment, software, and power is available for qualifying data center projects.
Natural Disaster Risk
Red Oak has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 43.46 as of September 2025. The primary risks are atmospheric and meteorological, while threats from events like earthquakes or coastal flooding are negligible.
Key risks for the area include hail, heat waves, drought, winter weather and ice storms, and lightning. Data centers in the region are designed and built to withstand these specific weather-related events, incorporating structural hardening and critical infrastructure redundancy.
