Port of Northern Montana Confirms Significant Low Cost Renewable Electrical Power Availability at Shelby Data Center Development Park

Montana Recently Improves Data Center Tax Incentive for Locations Such As Shelby, Mt

The Port of Northern Montana has recently confirmed that it has a significant amount of low-cost renewable electrical power available at its Data Center Development Park in Shelby.

In particular, as a result of a cooperative arrangement with NaturEner USA, there is approximately 10 megawatts (MW) of renewable electrical power currently available at the Shelby Data Center Development Park from the nearby Glacier Wind Farm at 4 to 4.5 cents per kilowatt hour (kWh), and by the end of the year it is projected that about 30 MW will likely be available at the data center park at around 3.5 to 4 cents per kWh.

With this confirmed low-cost renewable power along with State of Montana's recently revised and improved data center tax incentive and abatement, Shelby, MT is well-positioned for data center and cloud computing development.   

Following the initial passage and approval in 2017, the Montana Legislature in 2019 revised the tax incentive to expand it for certain qualifying data centers to attract more cloud computing development to areas such as Shelby, MT.

As a result, a qualified data center locating in Shelby, MT (as well as other parts of Montana) is eligible to have its property tax liability reduced by as much as 75% of its taxable value in the first five years after a construction permit is issued.

As Montana has no sales tax, the Montana data center property tax incentive/abatement combined with the significant renewable electrical power capacity within the Port of Northern Montana makes Shelby, MT a very attractive and competitive site for large data center development.

The Port of Northern Montana's Data Center Development Park in Shelby consists of ten ~140 acres sites zoned for large data center development, and it has substantial infrastructure including the city's water mainline, two electrical substations, and Interstate 15 access.

Furthermore, the Shelby, Montana area recently was designated as an Opportunity Zone, which is a new federal economic development program designed to encourage long-term private investments in low-income communities. This program provides a federal tax incentive for taxpayers who reinvest unrealized capital gains into Opportunity Zones, such as Shelby, MT, and serves as a catalyst for investment into specific items such as infrastructure, business startup and expansion, downtown revitalization, workforce development, and affordable housing.  In particular, the Shelby Data Center Development Park is included in the Opportunity Zone.

Shelby is also located along major transportation corridors. Due to these corridors, Shelby continues to see an increase in fiber network installations within existing right-of-way's and in-network capacity. Additionally, Shelby has a good combination of fiber optics capacity & redundancy and is connected to internet hubs all over the United States and Canada.  Shelby offers cloud computing or data center companies a robust fiber network.

A study in 2017 indicated that Shelby, MT is an attractive low-cost rural location with the necessary infrastructure to site a data center.  The study detailed Shelby's infrastructure, workforce, tax incentives, construction and operating costs, climate and available property to help interested parties make decisions about locating a data center in Shelby, MT.  With its combination of cooler year-round weather and wealth of renewable wind energy, Shelby is an ideal location to construct air-cooled cloud computing data center facilities, according to the study.  Cold external air is becoming a big attraction for data center operators, and many high-profile cloud computing companies are building new data centers in relatively cold and windy locations to cut power and cooling costs.  Consequently, locating a data center in Shelby will result in dramatically lower power consumption costs associated with cooling.  The study also indicated Shelby is an affordable place to site a data center, as Shelby's fairly flat topography is ideal for a data center construction as earthwork requirements are minimal, and industrial or commercial real estate in Shelby ranges from $2,000 to $10,000 per acre or $0.05 to $0.25 per square foot, which is considerably less than other sites across the nation.

In summary, Shelby, MT is an ideal location for data centers due to its power capacity, cool climate, low costs, infrastructure, tax incentives and accessibility.

Source: Port of Northern Montana
Date: Jan 27, 2020