Powering data centers
STORY AND PHOTOS BY RYAN HALL | RURAL MONTANA EDITOR
One of the biggest concerns and challenges when it comes to data centers, both generative AI and traditional computing centers, is how to power them — and how to do so with little to no impact to electric cooperative members, if not providing a benefit.
In public and industry forums on data center development throughout the Northwest, this has been a recurring theme. Data centers need power, lots of it, and they need transmission lines and infrastructure to bring that power to them.
Montana, like many states, does not have many spare megawatts, let alone spare gigawatts, waiting for new customers. And even if it did, there isn’t the capacity on existing lines to deliver it to those customers.
Data center advocates will point to communities where electric rates have stabilized or even dropped due to a large electricity customer, a large load in industry terms, such as a data center coming online. Opponents of data centers have examples of rates increasing, such as one highlighted by a CBS Evening News report in April showing residential electric bills nearly doubling in the past two years in a part of Georgia due to data centers locating in the region. Similar increases have also been reported in Virginia.
There are many different options for powering data centers, each with varying costs, timelines and degrees of reliability and availability. There are also many approaches to constructing and paying for the infrastructure needed, varying the impact on ratepayers.
Benefiting members
One example of an area that has been able to provide power without negatively impacting public power members’ rates is Grant County, specifically the Quincy area, in Washington. Grant County Public Utility District (PUD) Vice President of Customer Experience Andy Wendell said that utility has had a great experience with its eight large data centers.
“We love our data center customers,” Wendell said, adding that they pay their bills, and pay for the equipment and capital investments required to serve those loads.
When data centers came to the area in 2006, power wasn’t a problem. Grant County PUD had built two dams along the Columbia River, called the Priest Rapids Project, in the early 1960s. In 1952, Grant County PUD’s system was about 25 megawatts. Now it is more than 2,100 MW, with a majority of power coming from the two dams, along with wind and solar projects.
That made the area appealing to data centers.
Wendell said the PUD structured its large load rates to help utility members recoup the costs of the dams, which its members initially paid through rates, while keeping data centers’ rates competitive compared to other areas.
That structure means data centers pay about 150 percent of the cost to serve these centers through their Grant County PUD rates, while residential rate customers pay about 60 percent of the cost to serve their homes.
Additionally, in Washington state public utilities are prohibited by law from entering into economic development activities by offering better rates to any particular class, such as large loads.
“We have to treat all classes fair and equitable,” he said.
Wendell said that when it comes to any new data centers, or requests for additional power from existing ones, Grant County PUD doesn’t have all of the same challenges as Montana and elsewhere, but there are some similarities.
“Access to energy is not an issue for us. Distribution lines and substations are not a barrier. It’s really the transmission and transmission capacity that is our bottleneck,” he said.
He noted that data centers have offered to fund additional infrastructure. However, they want increased speed to power, an industry buzz term for how quickly power generation can be built or secured and delivered to a prospective site.
“Really the cost is the easy part,” Wendell said. “We were never built to meet the speed-to-power needs of today.”
He said that if a Montana cooperative is approached about a data center, the key is communicating directly with the end customer if possible, not a developer, to ensure there is a relationship with the eventual end user.
“Be eyes wide open, ask the questions, but don’t be afraid of data centers,” he said. “There’s tremendous opportunity, and tremendous risk.”
Powering a Montana center
Quantica Infrastructure and its subsidiary, Big Sky Digital Infrastructure (BSDI) are siting a data center near Broadview, a town of about 140 people near Billings. Quantica purchased 5,100 acres to site the data center and potential power sources, and as of May 2026 is leasing 45,000 acres for additional generation development, currently planned for firming power and renewables such as wind and solar on portions of that land, said Charlie Baker, chief accounting officer for Quantica.
The proposed data center would be built in two phases, each being more than 500 MW, for around 1,100 total MW, divided amongst a few buildings, Baker said.
“One misconception I’ve heard is we are going to fill this 5,100 acres with buildings. That’s not true,” Baker said. He added that any generation built on site would require a fair amount of land and setbacks, in addition to the data center campus itself.
One key to the site is that a NorthWestern Energy substation, with a 230- and a 500- kilovolt transmission line, is adjacent to the property.
“That is one of the reasons the site is attractive,” said Taylor McCarthy, director of communications for Quantica.
Baker and McCarthy said generation and transmission capacity are the major barriers to constructing data centers in Montana. Essentially, any potential data center developer needs to plan to pay for and/or bring its own generation.
“The only way to power this site is to pay for our own power and have our own generation,” Baker said.
In May, it was reported that Quantica filed interconnection applications with NorthWestern Energy covering about 7,235 MW of maximum additional capacity, including renewable and firming generation, plus battery storage. That prompted speculation that the data center may grow much larger than initially proposed.
Baker said that isn’t the case, noting that in addition to an undecided firming source, such as a natural gas plant, Quantica plans to build a large amount of solar and wind generation, and utilize batteries. They are expecting to operate at a 20 to 30 percent capacity factor, meaning the site will generate on average only about 20 to 30 percent of the total size of the renewable portion of the project. That means 5 gigawatts of renewable generation could only be counted on to consistently supply about 1 gigawatt of power. However, Quantica must apply for an interconnection that covers the full potential of all of the power generation on site, or the maximum combined output of the solar, wind, batteries and firming generation, even if the site will rarely generate that much power.
“The data center is still projected to be 1,100 megawatts,” Baker said. “The hope is it will be heavily renewable based.”
He stressed that Quantica doesn’t want ratepayers to be saddled with any additional costs related to the proposed data center or the new generation.
“As a developer we want to pay our own way. We don’t want ratepayers to have increased costs in power rates,” Baker said.
“We don’t want ratepayers to subsidize the project,” McCarthy said. “We want there to be a community benefit.”
A possible alternative
Though not yet utilized in Montana, there are methods to meet speed-to-power demands for large loads and provide reliable power, without burdening utilities and or residential ratepayers.
One such technology is deployed by ERock, a generation company with sites in multiple states.
ERock Chief Commercial Officer Allan Schurr said its projects have been done for many reasons, from providing reliable backup power to hospitals, to on-demand power when regional heatwaves or wildfires increase usage or knock out resources. It also provides solutions for data centers.
Schurr used a project in El Paso as an example. A local utility only had about 200 MW of power available, but a new data center needed 1,000 MW.
“It would take five years to get 800 megawatts (traditionally),” Schurr said. “We stepped up to provide Phase 2.”
ERock provides ready built, kitted modular low-pressure natural gas generators. A base arrives for every five units, with all of the cabling pre-run. Each of the five generators is set on top of that. Everything is trucked to the site from Houston.
The El Paso project will run 24/7 for five years to power the data center “behind the meter,” meaning the utility will not be responsible for it and the power is largely dedicated to the data center. Once the new generation, transmission and substation needed for the data center are operational, all power will come from the local public utility, and the modular plant converts to a dispatchable firming or peaking plant in front of the meter and owned by the El Paso utility, purchased at essentially no cost through a lease agreement with the data center, or it can be dismantled and repurposed elsewhere.
ERock projects take up about one acre per every 50 MW, due to the compact vertical construction — much less than a traditional gas-powered turbine power plant.
It takes about 123 21.9-liter natural gas modular generators, each putting out about 450 kilowatts, to make 50 MW, which helps with reliability. Five generators can be out for maintenance without significantly impacting the total output. Each bank of five generators can be shut down, or any individual engine can be taken offline for maintenance or repair, without impacting the others.
“We can deliver five 9s (99.999 percent reliability) from the generation site,” Schurr said, walking through a site that provides dispatchable power.
“In about 10 seconds we have power out to the gird,” said Edgar Quintero, operations manager O&M West for ERock, adding it takes about 30 seconds for the grid to accept that power.
The modular engines are no louder than a truck engine, with normal volume conversations being able to occur right next to them. They are certified by the California Air Resources Board, which has the strictest air emissions standards in the country, and have no stacks.
Schurr said that once a data center or utility places an order, up to a gigawatt of power is typically operational on site within a year.
Schurr and Quintero noted the engines are self contained so any fluid leakages stay in the container housings, and the generators use no water.
“The only water we use on site is the bathrooms,” Schurr said.
He added that the modular design is considered a minor source, so typically the emissions permitting process is around two months.
Co-ops and data centers
We will explore how electric cooperatives would deal with powering a date center in the fourth and fifth parts of this series. However, it is important to note that several co-op managers have previously stated in RM that any large load would have to pay its own way for any additional generation and infrastructure, and that co-op members would not subsidize data centers, preventing the rate increases seen in Georgia and Virginia.
In a December column, Beartooth Electric Cooperative Manager Pat Patterson wrote, “As a cooperative, we have an obligation to serve, but the cooperative’s management and board also have a responsibility to ensure that our member-owners are not adversely impacted by the addition of a large data center. Any new data center must pay 100 percent of the costs required to serve it, including all necessary infrastructure upgrades.”