Minnkota Raises Cost of Data Center Power Project, But Customers Won't Be Affected

The $110 million project to power a new data center north of Fargo will be fully covered by the data center company.

Apr. 2, 2026 at 9:22pm

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A photorealistic studio still-life image of a polished, geometric metal electrical substation component floating on a clean, monochromatic background, using dramatic lighting and shadows to represent the infrastructure behind powering a new data center.A new substation and powerline project will provide the reliable electricity needed to power a major data center development in North Dakota.Fargo Today

The cost of the powerline and substation needed to power a new data center north of Fargo has risen from $75 million to $110 million, but the data center company, Applied Digital, will still cover the entire cost of the project. Minnkota Power Cooperative, which will own the infrastructure, says the increase is due to trying to meet a tight construction timeline, material scarcity, and tariffs, but there will be no cost shift to Minnkota's customers.

Why it matters

The new data center is a major economic development project for the Fargo area, requiring 280 megawatts of power at peak demand. Ensuring the necessary infrastructure is in place to support the data center is crucial, and Minnkota's commitment to covering the full cost protects its existing customers from any rate increases.

The details

The project includes a 345-kilowatt powerline about 1.74 miles long and a new substation east of Interstate 29 near the data center. Minnkota says the increase in project cost from $75 million to $110 million is due to the tight construction timeline, material scarcity, and tariffs, but Applied Digital will still pay for the entire project upfront.

  • Minnkota is hoping to start construction on the project later this month.
  • The company aims to have the new powerline and substation operational by the fall of 2026.

The players

Minnkota Power Cooperative

A regional electric cooperative that will own the new powerline and substation infrastructure to serve the data center.

Applied Digital

The data center company that will be the large load customer for the new power project and will cover the full $110 million cost.

Cass County Electric

A member of the Minnkota co-op family that will deliver power from the new infrastructure to the data center.

North Dakota Public Service Commission

The state regulatory body that must approve Minnkota's permit application for the new powerline and substation.

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What they’re saying

“Minnkota's large load customer, Applied Digital, would pay for the project upfront with no 'cost shift' to customers of Cass County Electric, which will deliver power to the data center.”

— Brendan Kennelly, Chief Operating Officer, Minnkota Power Cooperative

What’s next

The North Dakota Public Service Commission must still approve Minnkota's permit application for the new powerline and substation project.

The takeaway

This project demonstrates how major data center developments can spur critical infrastructure investments, with the data center company covering the full cost to ensure reliable power delivery without impacting existing utility customers. It also highlights the regulatory oversight and coordination required to bring such large-scale energy projects online quickly.