Creating connections

A fireside chat held Jan. 29 brought together leadership from Minnkota Power Cooperative, Cass County Electric Cooperative and Applied Digital to discuss the development of a large-scale data center campus in Harwood, North Dakota.

The discussion, held at Minnkota’s Grand Forks offices, featured Wes Cummins, CEO of Applied Digital, Minnkota CEO Mac McLennan and Cass County Electric CEO Paul Matthys, along with questions from directors from both cooperative boards.

Construction and planning for the Harwood campus continues to move forward at a brisk pace, with a target of early 2027 for full commercial operation. At the same time, Applied Digital has completed its second of four data centers in Ellendale, North Dakota, which has already demonstrated the potential benefits of large-scale energy users in the region.

Cummins said projects in the Dakotas have already shown benefits to electric consumers.

“We located there because we identified excess electricity and infrastructure that could be better utilized,” Cummins said. “The use of that excess electricity has actually lowered energy bills for the surrounding residents. To date there have been more than $31.7 million in total savings for North Dakota customers and more than $1.1 million in savings for South Dakota customers.”

Those savings were passed back to regional consumers through a bill credit, illustrating how large energy users can help share the fixed costs of maintaining the electric system.

McLennan emphasized that while data center development presents significant opportunities, the cooperative’s primary responsibility remains with its existing members.

“We are not going to place undue risk on our legacy members, those people we’ve served for 80-plus years,” McLennan said. “Our focus is on ensuring that any growth benefits our membership and maintains the reliability and affordability they expect.”

Minnkota and Cass County Electric are approaching the Harwood project with legacy members in mind. Large, consistent energy purchases from data centers help recover the fixed costs of generation, transmission and distribution infrastructure. Without those additional loads, costs would otherwise be borne by homes, farms, schools and businesses across the system. Applied Digital will pay the full cost of the infrastructure and resources it uses, along with any additional development required specifically for the project.

By making more efficient use of existing resources, cooperative leaders say the project is expected to help stabilize long-term rates for members. However, they also noted that supply chain challenges and inflationary pressures continue to affect near-term rate impacts across the utility industry.

For Applied Digital, North Dakota offers several advantages for large-scale data center development. Cummins cited the state’s strong energy production, robust fiber infrastructure, business-friendly environment and cold climate as key factors. Available workforce is also a key, as the Harwood facility plans to add more than 200 full-time jobs.

“This is an energy-rich state that produces much more than what is used inside the state,” Cummins said. “It’s also a fiber-rich and business-friendly state. Maybe most importantly, it’s cold, which is a big benefit for cooling the equipment.”

As work continues on the Harwood campus, cooperative leaders say the project represents an opportunity to support economic development while strengthening the electric system for the members they serve.

MAIN IMAGE: Minnkota CEO Mac McLennan (left) listens as Applied Digital CEO Wes Cummins speaks during a January fireside chat with the Minnkota and Cass County Electric boards. (Minnkota/Michael Hoeft)