Data Centers in Waco
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Waco – Strategic Central Texas Colocation
Waco offers a compelling alternative to the primary Texas data center markets of Dallas and Austin. It is an ideal location for organizations prioritizing disaster recovery, lower operational costs, and strategic positioning within the Texas Triangle. This market provides reliable infrastructure without the premium costs and congestion of larger metropolitan hubs.
Waco: At A Glance
| Factor | Rating / Data | Notes |
|---|---|---|
| Global Connectivity Grade | B | Solid regional connectivity, suitable for most business and DR applications. |
| Direct Cloud On-Ramps | 0 – as of September 2025 | Nearest on-ramps are in Dallas. Private network extensions are common. |
| Power Cost | $0.07 – $0.09/kWh | Based on Texas industrial averages, as of September 2025. |
| Disaster Risk | Moderate (43.46 NRI Score) | Lower risk profile than coastal areas for specific threats like hurricanes. |
| Tax Incentives | Yes | State-level sales and use tax exemptions are available for qualified data centers. |
| Sales Tax | 6.25% (Texas) | State sales tax as of September 2025. |
Network & Connectivity Ecosystem
Carrier Density & Carrier Neutrality The Waco market provides access to over 5 carriers as of September 2025. Colocation facilities are carrier-neutral, offering diverse connectivity options suitable for production workloads and disaster recovery sites.
Direct Cloud On-Ramps There are no direct public cloud on-ramps located within Waco as of September 2025. Businesses connect to all major cloud providers, including AWS, Google Cloud (GCP), and Microsoft Azure, via private network circuits to the primary interconnection hub in Dallas.
Internet Exchange Points (IXPs) Waco does not host a major public Internet Exchange Point. Most network peering occurs through private interconnects or is routed through the extensive peering ecosystem in Dallas.
Bare Metal Bare metal server options are available in the region, typically through providers located in nearby Dallas or Austin. Services from providers like Hivelocity and phoenixNAP can serve Waco with minimal latency.
Power Analysis
Average Cost Of Power The average cost for industrial power in the Waco area is estimated between $0.07 and $0.09/kWh as of September 2025. Texas benefits from a diverse energy mix, dominated by natural gas and a significant, growing wind power component, which helps stabilize energy pricing.
Power Grid Reliability The power grid is managed by ERCOT. While it operates independently, data centers in the area are engineered with significant redundancy, including multi-megawatt generator and UPS deployments, to ensure high levels of uptime.
Market Access, Business & Tax Climate
Proximity To Key Business Districts Waco is strategically positioned along the I-35 corridor, placing it almost equidistant from the Dallas-Fort Worth Metroplex and the Austin metropolitan area. This location is ideal for serving businesses across Central Texas.
Regional Market Reach A data center in Waco can provide low-latency connectivity to the entire Texas Triangle, a region encompassing Dallas, Houston, and Austin with a population of over 20 million people.
Tax Advantage For Data Centers Texas offers a significant tax incentive for qualifying data center projects. Operators and their tenants can receive a 100% exemption from the state's sales and use tax on equipment, software, and power, substantially reducing initial capital and ongoing operational costs.
Natural Disaster Risk
Waco has a moderate natural disaster risk profile, with a FEMA National Risk Index score of 43.46 as of September 2025. The location avoids the primary threats of coastal flooding and direct hurricane landfalls that affect other parts of Texas.
Key risks for consideration include drought, hail, heatwaves, lightning, riverine flooding, and winter weather. Facility designs and operational planning are critical to mitigate these regional environmental factors.
