President and CEO
When most people picture a data center, they often imagine a sprawling campus tucked into a major metro area like northern Virginia or Silicon Valley. But increasingly, some of the nation’s largest data centers are being built far from big cities — right here in rural America. For electric cooperatives, that shift presents both opportunity and responsibility.
Data centers are the backbone of today’s digital economy, powering everything from cloud storage and online banking to streaming services and artificial intelligence. These facilities operate 24 hours a day, 365 days a year, requiring enormous amounts of reliable electricity. In fact, the U.S. Department of Energy estimates data centers now account for roughly 2% to 4% of total U.S. electricity use, and that number is expected to rise significantly as AI-driven computing expands. Some projections show U.S. data center power demand could nearly triple by 2028.
Why Rural Areas?
For years, data centers clustered near major cities to stay close to internet traffic hubs. But as demand has exploded, operators have looked outward — and rural America has become an attractive destination.
The biggest reason is access to land and power. Rural communities often offer large tracts of affordable land that can support massive campuses with room for future expansion. Just as importantly, many electric cooperatives have strong transmission infrastructure and available capacity, making them ideal partners for facilities that need dependable, around-the-clock service.
Rural areas also often provide cooler climates that reduce cooling costs, faster permitting timelines, and access to renewable energy resources like wind and solar — all priorities for companies with aggressive sustainability goals.
An Opportunity for Electric Cooperatives
For electric cooperatives, landing a large data center can be a big win. These facilities bring substantial new electric load, which can improve system utilization and create new revenue streams that help spread fixed infrastructure costs across a larger customer base. That can support long-term grid investments that benefit all members, including stronger substations, upgraded transmission capacity, and modernized distribution systems.
The National Rural Electric Cooperative Association (the national service organization that represents more than 900 consumer-owned co-ops across the country) has noted that large-load growth from data centers presents unique opportunities for co-ops willing to strategically plan for future infrastructure needs.
Smarter Than They Used To Be
Early data centers earned a reputation as energy hogs, with inefficient cooling systems and underutilized servers driving waste. That picture has changed dramatically.
Today’s modern facilities are significantly more efficient, thanks to major advances in design and technology.
Innovations like liquid cooling, hot-aisle containment systems, AI-driven energy management software, server virtualization, and advanced airflow engineering have slashed unnecessary power use.
One key measure of efficiency is Power Usage Effectiveness, which compares total facility energy use to the energy used directly by computing equipment. Years ago, many facilities operated with PUE ratings above 2.0 — meaning every watt used for computing required another watt for cooling and overhead. Leading hyper-scale facilities today often achieve PUE ratings near 1.1, approaching near-optimal efficiency.
That means while data centers consume more total electricity than ever because of rising demand, they are delivering vastly more computing power per kilowatt than their predecessors.
Planning Is Critical
The opportunity is significant, but so are the challenges.
Large data center loads can require substantial generation, transmission, and distribution upgrades. Cooperatives must carefully evaluate long-term contracts, cost recovery structures, and infrastructure timelines to ensure growth benefits all members without shifting costs unfairly.
The most successful co-op partnerships will come through thoughtful planning, strong contracts, and close collaboration between utilities, developers, and regional grid operators.
Rural America’s Digital Future
Data centers are no longer just urban infrastructure. They are becoming part of rural America’s economic future.
For electric cooperatives, these projects represent more than just new load on the system. They offer a chance to strengthen infrastructure, diversify revenue, and position rural communities at the center of the nation’s digital transformation.
As technology companies continue searching for reliable, affordable, and increasingly sustainable power, America’s electric cooperatives may be uniquely positioned to help power what comes next.