DEUEL COUNTY, S.D.(KXLG)- The Deuel County Commissioners heard a presentation this morning from Nick Phillips of Applied Digital, a company specializing in the design, construction, ownership, and operation of next-generation data centers for artificial intelligence applications. The potential project, if realized, could represent a multi-billion-dollar investment in the county.
Phillips provided a high-level overview of Applied Digital, highlighting their existing facilities.
To provide context, Phillips noted that a city like Bismarck, North Dakota, including industrial use, consumes around 100 MW (Mega Watts) of power. This stresses the substantial energy demands of Applied Digital’s facilities, which are primarily used for AI applications such as medical imaging, agricultural analysis, and other computationally intensive tasks.
The proposed project in Deuel County would involve an estimated investment of $4.3 to $5.5 billion by Applied Digital and its customers, with a total project impact potentially reaching $10 to $16 billion. The facility would be located on a 150—to 200-acre site east of Toronto, near the gas turbine tower and gas pipeline.
The initial plan includes the construction of two large data center buildings, each approximately 907,500 square feet, with a total power load of 400 to 430 MW. The internal compute equipment in each building would utilize around 150 MW, with the remaining power dedicated to cooling systems.
Phillips emphasized the significant economic benefits the project could bring to Deuel County.
Job creation was another key aspect of the presentation. The facility is expected to employ around 200 people in permanent roles, including positions in mechanical, electrical, facilities, plumbing, security, and high-tech fields. These positions would offer competitive salaries with an estimated average of $64,000. Applied Digital aims to hire locally whenever possible but anticipates attracting some employees from outside the area, which is why they have invested in housing in other communities like Ellendale, where they built 20 single-family homes and are adding a 38-unit apartment building.
Addressing infrastructure needs, Phillips highlighted the importance of fiber optic connectivity, noting that their facilities require hundreds of strands of fiber, significantly more than the existing infrastructure in many areas. Applied Digital typically brings in substantial fiber improvements to their sites.
Phillips also reiterated their commitment to working with the county on road infrastructure to mitigate any impact from construction traffic, including addressing road maintenance issues upfront.
A key concern with data centers is water usage. However, Phillips assured the commissioners that their facilities utilize a closed-loop liquid cooling system with a mix of glycol and water, employing dry coolers similar to radiators in cars. Their water consumption is minimal, around 10 gallons per minute, primarily for typical office uses.
In response to an inquiry from the crowd, the company also builds retention or detention ponds to manage rainfall runoff from its large building footprints (approximately 25 acres under roof per building). For example, the facility in Ellendale, ND, has implemented a system to allow local farmers to access this water for free, and the fire department also views it as a potential water reservoir.
Regarding noise, Phillips stated that while there is some noise from fans and cooling equipment, they work to minimize it through setbacks and potential barriers to avoid impacting nearby residents. Their internal requirement is to be at least half a mile away from any existing homes.
Challenges remain for the project to move forward. Phillips noted that current zoning regulations in Deuel County do not exist to accommodate a project of this scale, necessitating discussions with the zoning board, which had members present at the meeting to listen.
Additionally, there are differences in sales tax regulations.
The company has been in contact with state officials and provided presentations to the Public Utilities Commission (PUC) to ensure their operations do not negatively impact the existing power grid or raise rates for other consumers. Their facilities also include on-site backup generation to ensure reliability and self-sustainability. If there is a power outage, the facility can self-sustain on its own generator power so residents can utilize the power grid.
The project timeline includes an estimated 6 to 9 months to work through zoning and state-level considerations, followed by approximately 18 to 24 months for construction.
In response to further questions, Phillips addressed fire safety, noting that they work closely with local fire departments to provide training and ensure they have the necessary equipment and understanding of the specialized systems within the data center. He also clarified that job roles range from those not requiring a college degree to positions requiring advanced technical skills.
After the presentation, commissioners thanked Nick Phillips for the information and expressed optimism about upcoming discussions concerning the potential project. They recognized the importance of addressing zoning regulations and said, “Look forward to seeing you here again, welcome to Deuel County.”
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