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RBN Energy: comparing data center development drivers across key states. Link here. Archived.
Data centers are cropping up everywhere. Established markets like Northern Virginia are expanding, and Texas has received a wave of proposals. But while data centers have found new homes in Georgia and Ohio, mature markets like California and Illinois are becoming less attractive to new development. In today’s RBN blog, we’ll examine the factors that influence data center development across seven key states — Arizona, California, Georgia, Illinois, Ohio, Texas and Virginia — and show how each stacks up.
We’ve been hard at work mapping the what, the where, and the when regarding the U.S. data center buildout. As data centers have come online across the country, the uncertainty surrounding regional power and natural gas demand has only grown. In Won’t Get Fooled Again, we addressed how data centers will impact natural gas demand in Texas and Louisiana — a necessary data series for the Arrow Model, our proprietary analytical framework built to assess both states’ gas markets. But understanding data centers’ impact requires knowing where they will be built in the first place.
Back in 2024, Where You Lead I Will Follow examined the factors that influence data center development, focusing on the importance of uninterrupted power supply in established markets like Northern Virginia, Texas, Chicago and Silicon Valley. But the data center map has changed significantly since then, with Georgia, Arizona and Ohio emerging as important growth markets. Nationally, this growth has coincided with a changing regulatory environment, particularly in mature markets.
Figure 1 below offers our updated view of the seven leading states for existing and new data centers, comparing each on the key factors that determine where projects are built. While we covered many of these topics for Virginia in Part 1 of our Sweet Virginia blog series, any state’s strengths and weaknesses are relative to the other markets developers may consider. As a result, the matrix in Figure 1 indicates whether a specific factor (rows) is a relative strength (green plus sign), weakness (red minus sign), or neither (yellow tilde), in each state.