Data Centers in Utah

Utah – High Density Infrastructure for Silicon Slopes Connectivity

Executive Summary

Utah has emerged as the premier Western alternative for high density compute workloads, providing a strategic refuge from the extreme operational costs of coastal California. This market is built for organizations requiring massive scale, offering a blend of low industrial power rates and a tax climate specifically designed to favor long term infrastructure investment.

Utah: At A Glance

Network & Connectivity Ecosystem

Utah has transitioned from a transit point into a destination for major deployments. The infrastructure here is purpose built for high density interconnection and reliable regional peering.

Carrier Density & Carrier Neutrality: The market features a maturing ecosystem with over 15 carriers as of September 2025. Facilities in Salt Lake City and the surrounding valley are largely carrier neutral, providing flexible access to diverse fiber backbones that connect the Pacific Northwest to the Southwest.

Direct Cloud On-Ramps: There is Over 1 direct on-ramp, enabling access to 1 cloud regions as of September 2025. Enterprises can establish direct, private links to Google Cloud (GCP) within the state, bypassing the public internet for better security and predictable performance.

Internet Exchange Points (IXPs): Salt Lake City is the primary peering hub for the region. The XMission Salt Lake City IX allows for efficient local traffic exchange, which keeps latency low and reduces transit costs for local service providers as of September 2025.

Bare Metal: Sturdy bare metal options are readily available through global providers like Hivelocity and phoenixNAP, allowing for rapid scaling of hybrid environments as of September 2025.

Power Analysis

Energy availability and pricing are the primary drivers of the Utah data center boom, especially for AI and high performance computing clusters.

Average Cost Of Power: Industrial electricity is priced at approximately $0.07/kWh as of September 2025. This pricing is a massive advantage for power hungry deployments that would be cost prohibitive in more expensive Western markets.

Power Grid Reliability: The local grid is well engineered and maintains high uptime across the Salt Lake Valley and Utah County corridors. Reliability is supported by a diversified generation mix including natural gas and coal, with a growing contribution from solar and wind as of September 2025.

Market Access, Business & Tax Climate

Utah is widely recognized as one of the most business friendly environments in the United States, which has led to a dense cluster of tech headquarters along the Wasatch Front.

Proximity To Key Business Districts: Data centers are concentrated near the Silicon Slopes, a high growth corridor between Salt Lake City and Provo. This proximity provides direct physical and network support for a large concentration of software, financial services, and aerospace firms as of September 2025.

Regional Market Reach: Utah serves as a central hub for the Intermountain West, providing sub 15ms latency to most major population centers in the Western United States. It is an ideal site for secondary disaster recovery or a primary regional edge location.

Tax Advantage For Data Centers: Utah provides aggressive tax benefits, including sales and use tax exemptions for qualifying enterprise data centers. These incentives significantly lower the total cost of ownership for large scale server refreshes and infrastructure upgrades as of September 2025.

Natural Disaster Risk

The state faces specific environmental challenges that require resilient facility engineering. The FEMA NRI Score is High (94.2) as of September 2025.

Utah is an inland market, so coastal flooding and tsunamis are not material risks. The primary natural hazards include:

• Wildfire: A seasonal risk in the surrounding foothills and mountain areas.
• Earthquake: Regional seismic activity requires facilities built to high seismic standards.
• Drought: A long term regional concern for water intensive cooling systems.
• Strong Wind: High velocity wind events are common in the valley corridors.
• Winter Weather: Occasional heavy snow and ice require managed facility access plans.
• Avalanche: A specific risk for high elevation sites and critical transit routes.