Logan County wants economic development. Might this sparsely settled area of northeastern Colorado become home to a hyperscale data center?
by Allen Best
A data center that may soon be formally proposed in northeastern Colorado shocks me in its potential demand for electricity. A behemoth.
The data center may require up to two gigawatts of electricity, according to what is being said in Sterling, which is about 130 miles northeast of Denver.
To put that into perspective, Colorado Springs Utilities needed a little more than one gigawatt to meet its peak summer demand in July 2024. Tri-State Generation and Transmission, which provides power to 39 mostly rural electrical cooperatives spread across four states, including Colorado, has a peak demand of 2.5 gigawatts.
Wheat farms and grazing lands dominate the landscape where this center would go. Wheat land goes for $900 to $1,000 an acre, grazing lands maybe $800. Total capital investment, according to one speaker at a recent meeting, would be $15 billion.
I have thin but distinct roots in that area. In 1890, my grandfather was born in a sod house there on land homesteaded by his parents three years before. Those homesteading Riekes tried farming but soon turned to grazing cattle on the short-grass prairie in what they called the Kenesaw Valley, seen in the background in the above-photo. Within 15 years, they had moved to Sterling. My great-grandfather was elected county treasurer, I am guessing because he was a graduate of a business college in Illinois.
My grandparents — she was a Schmidt, similarly born of recent German immigrants — worked a farm irrigated by water from the South Platte River and grazed cattle on the prairie. My grandfather was elected a county commissioner four times, in the 1930s and again in the 1960s.
Since the late 1960s, when my grandparents sold their farm, Logan County’s population has strayed little from 20,000. Sterling has a junior college and, beginning in 1999, a prison.
On the county’s northern tier, an area along the Nebraska border called the Peetz Table, six to eight wind farms have been built since 2007, and Xcel Energy has indicated it may want to add more wind-generating capacity. The existing wind projects boost the county’s tax base by about $2.5 million annually.
“It’s not huge, but it’s nice,” says County Commissioner Mike Brownell.
Might this data center bring a new era of prosperity and modest population growth? And how real is this?
Granite Renewables began visiting with Logan County officials in late summer and early fall. The New York-based company says on its website that it develops project sites for “co-located data centers.” Having renewables on-site matters greatly. So does having access to natural gas and connections to the broader grid. This site seems to check the boxes.
“By combining the affordability of renewables and grid power with the reliability and redundancy of modular gas units, we deliver a secure energy supply as an improvement to centralized infrastructure,” the company says on its website.
It also offers these key words: resilience, sustainability, and energy independence.
Batteries are a component of Granite’s mission. At its website, the company says that from 2022 to 2024 it originated and developed a portfolio of eight projects in the Midwest that totaled 2.7 gigawatts of alternating current capacity.
Oddly, Google searches produce no mentions of the company save for the company’s website. But many of the companies mentioned in data center stories are not exactly household names.
Logan County in October declared a moratorium on data centers and battery storage as well as solar and wind development. They want to get regulations in place that protect the county’s best interests. Like nearly all of Colorado, the county has no data centers today.
The county’s planning commission has now recommended regulations covering data centers and battery storage to the county commissioners, who are scheduled to review the recommendations on Jan. 6.
In Sterling, however, officials talk about 4,000 acres. Much of that land would presumably be used for solar farms along with battery storage and the hyperscale data center or centers. He also declined to identify the precise site, although the Sterling Journal-Advocate in an October report said it would be 21 miles northwest of Sterling. That would put it 8 to 10 miles from the Nebraska border and within a horse ride of where my ancestors broke the prairie sod.
Why in such a place?
Why this site in particular? By urban standards, Sterling itself is a very small town. But this site is far away from Sterling’s porchlights.
Wheat-growing land is typically cheap, making ample land available for renewable energy to develop along with proximity to gas supplies. Major gas lines lie parallel to Interstate 80, located within 30 miles in nearby Nebraska. And, of course, there would be few neighbors.
The Logan County commissioners, when I talked with them, also posed the idea of imported power, conceivably coal- or gas-generated power from Wyoming. How might that play with Colorado’s goals for emission reductions? We didn’t talk about it.
Colorado lags many other states in data centers, particularly Virginia and Texas but also next-door Wyoming. This lag causes angst among the utilities and economic boosters, who think Colorado needs to get in on the next big thing. A conference partially devoted to that quest was held Dec. 12 in Denver at the International Brotherhood of Electrical Workers headquarters. Electrical utilities were well represented on the several panels in this new alliance that challenges Colorado’s greenhouse gas goals.
Colorado already has many data centers but very few that fall under the heading of hyperscale. Definitions vary, but a building the size of a football field and with demand for 100 megawatts of electricity would make a data center hyperscale. In metropolitan Denver, the QTS project near I-70 and E-470 falls in that category. More now seem to be coming, mostly on the metropolitan area’s fringes, such as along Interstate 76.
Tri-State Generation and Transmission, though, sees a new future, a clear interest in rural areas, as chief executive Duane Highley told Big Pivots in early October. Tri-State provides electricity to Highland Electric, the cooperative that serves rural Logan County. Tri-State hopes to secure approval from the Federal Energy Regulatory Commission of an electrical rate attractive to data centers. It was rejected on procedural grounds in October but Tri-State plans to reapply in February.
Cheyenne has become home to many data centers. The National Center for Atmospheric Research installed what it called a supercomputer there in 2012 called Yellowstone. That raised eyebrows in Boulder, home base for NCAR. Yellowstone was replaced by an even more powerful computer in 2018.
Microsoft and Meta and other companies have more recently arrived in Wyoming. They mostly rank as hyperscale. More yet are arriving. In October, for example, Related Companies broke ground on a data center with an expected investment of $1.2 billion. A key client for the project will be New Jersey-based CoreWeave, which specializes in providing cloud-based graphics, explained the Wyoming Eagle Tribune.
Far larger is the 1.8-gigawatt artificial intelligence data center being built by digital-infrastructure company Crusoe. That, reported the Cowboy State Daily after the July groundbreaking, will make it the largest yet in Wyoming. That’s just a little smaller than the 2 gigawatts being discussed in Logan County. Crusoe’s data center at Cheyenne, though, is talking about the potential to scale up to 10 gigawatts. For comparison, Xcel Energy in its Colorado operations expects a demand of 8.6 gigawatts peak demand.
Crusoe’s operation is to be powered by natural gas and to have a carbon capture component. Wyoming has no greenhouse gas reduction targets, but Cheyenne lies just 17 miles from the Colorado border.
“A race is on right now to build out artificial intelligence data centers all over the country and the world. That makes this moment a generational opportunity. But the state faces challenges when it comes to fully capitalizing on that opportunity,” observed the Cowboy State Daily.
Enthusiasm — and some caution, too
Economic development officials in Logan County almost fervently want to believe that they will be part of this boom.
The data center could produce up to a thousand construction jobs, a potential $15 billion capital investment, and between 50 and 100 permanent, high-paying technical and management careers, said Andrew Fritzer, chair of the board of directors for the Logan County Economic Development Corporation, at an October meeting covered by the Sterling Journal-Advocate,
“This project represents a once-in-a-generation opportunity to transform the local economy and secure long-term benefits for the people of Logan County,” he said.
In imposing the moratorium on data centers in October, the Logan County commissioners stressed that they hoped it would be brief. They, too, hope for tax base.
The story in northeastern Colorado in some ways echoes that of a rural area of New Mexico. “A Mysterious Company Came to Town With a $165 Billion Idea,” was the fetching headline in the New York Times. “As wealthier areas are pushing back against huge A.I. data centers, speculators are pitching places like Doña Ana County, N.M., on their vision. Local officials are eager for a deal — even if they don’t quite know the terms.”
Business writer David Segal summarized the tensions in New Mexico and at least part of the conversation in Colorado: “Naysayers contend that the astounding outlays are inflating a bubble that will end with a calamitous pop. Once that happens, they predict, the country will be covered with a lot of empty buildings, perfect for laser tag and not much else.”
Are we in a bubble in this data center-building spree? And will it soon burst, similar to the dot-com bubble of the late 1990s that imploded in 2000?
Trae Miller, executive director of the Logan County Economic Development Corporation, told Big Pivots that he sees hyperscale data centers being a good fit for rural areas. The level of workers is meaningful but not overwhelming, he said. “In a lot of urban areas, it’s underwhelming. You talk about the number of jobs, and they don’t get excited.”
Miller said he has had several conversations about potential data centers, but the Granite Renewables project is the most serious. He wasn’t even aware of it until September. During our November conversation, he worried about the message the moratorium sends.
“We want to make sure that we are sending a positive message to the market about the interest in and value of siting these types of projects in rural communities. I really do think that there are good opportunities, and when done the right way, they can be very beneficial to all parties. I hate to see the mortarium because it sends a negative message to the market.”
County commissioners say they do not want to stand in the way of economic development but do want to be prepared. Revising solar and wind regulations were already on the agenda and data centers were added to the planning commission’s to-do list in October.
“We had no idea that anybody was contemplating data centers in our area until we started talking about putting a moratorium on solar to clean up our regulations,” Brownlee, the county commissioner, told Big Pivots.
“Data centers weren’t really on our radar. We had asked P&Z to work on battery storage about a year ago. They were working on it but there was no urgency. Our intent was in no way to hold things up for a long period of time. We were originally thinking about a 60-day moratorium to get our ducks in a row.”
Commissioner Jim Yahn is of a similar mindset. “I’m not opposed to moving as quickly as we can, but you have to understand, this is all new to us. We want economic development with this, but we don’t want to look back 10 years down the road and have regrets because we did something in haste,” he said at the October meeting, according to the Journal-Advocate account.
Water and energy?
Data centers need massive amounts of energy, and they also require water. The South Platte River is nearly the exclusive source of water, and that water is already disputed. See: “What exactly is Nebraska’s dispute with Colorado about?” Oct. 16, 2025.Logan County, if not as cool as Cheyenne, remains cooler than any place in Texas or Virginia.
That means renewables and “flexible gas generation” and having access to the broader electrical grid.
“Our facilities are engineered for resilience, sustainability, and energy independence.,” says the company. Data center owners do want that independence. They want to control their own destiny.
What does that mean in practice? Solar and natural gas are clearly in the cards. With 4,000 acres, that could be a lot of solar.
The county already had regulations governing wind and solar development. These regulations need only a little tweaking, Brownlee and Yahn said. For example, existing regulations are too lenient, in the eyes of some residents who want greater setbacks from public roads.
The county is likely to adopt a higher fee to cover the cost of third-party evaluations of code compliance. The county has a two-person planning and building review staff.
A specific concern is about the need to revegetate areas formerly used for dryland farming. The goal will be to avert dust storms or water erosion. “This is something that needs to be done prior to any solar panels going on the ground,” said Yahn, who manages two reservoirs, North Sterling and Prewitt, in addition to his duties as a commissioner.
The Colorado Energy Office has provided useful resources in helping revise regulations for these shifts in energy. At the same time, the commissioners are adamant that they do not want the state dictating local regulations. That is a common attitude in eastern Colorado, but not all that different from the attitudes of local governments across Colorado.
In the case of batteries, concerns are being addressed about impacts to local all-volunteer firefighting departments. NextEra Energy, a major energy company in Colorado and other states, offered to provide sample regulations. As well, say the commissioners, the county has been consulting other counties to see what can be useful.
Yahn has concerns about the location of data centers near Minute Man Missile silos. He points out that one center near Warren Air Force Base, outside of Cheyenne, had to be closed because it was too close. Could data centers or renewable energy within a mile of those missile sites be a problem? He has also vowed to work to ensure the data center does not result in higher prices for farmers.
As for solar, Logan County today has just a handful of smaller solar projects, 30 acres and 5 megawatts or less in size. The solar component could be Colorado’s largest.
Today, the largest is at Pueblo, on 1,800 acres owned by Rocky Mountain Steel proximate to the Comanche Generating Station. The project, Bighorn, had a capacity of 348 megawatts, allowing the steel mill to claim with just a few asterisks that it produces solar-made steel.
What would grandpa think?
When my grandfather died in 1980, solar remained in its infancy, a still very expensive way to generate electricity. Now, it’s among the cheapest ways, second only to electricity produced by the giant wind turbines. Wind turbines already dot the horizon near where he was born and conceivably the land now used to grow wheat will grow electricity to be used in computers for who knows what purpose.
It’s part of the family story that when he was still a young boy, maybe 5 or 6, my grandfather was taken by horseback to Sterling, his first visit to the big city. Cresting a hill, he saw the South Platte River Valley for the first time and its abundance of trees.
“What do you see,” he was asked.
A lot of cows, he guessed. On the prairie homestead, trees were scarce.
Later, he drove a motorcycle to San Francisco, went to France in World War I and flew on a jet to Alaska. I wonder what he would think of this prospective island of computers in a sea of solar panels.
Photo/Don Best, looking south from the Peetz Table toward the area of the potential data center
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Very interesting article on a possible data center out NW of Sterling. As a Sterling kid (SHS class of ’74) I spent many a day out in the West Plains / Kenesaw / Chimney Canyons country hunting rabbits and doing things that any small-town teenager should know better than to do. One of the big questions is where would a data center out there get the needed water? There is virtually no perennial source of surface water out there and groundwater is only available in fairly small amounts from wells in the White River and similar bedrock formations. But Jim Yahn knows all this- he is certainly one of the best water brains on the South Platte. It will be interesting to see what develops. Cheers!
He said they would need a one-time fill. I did not ask about the dimensions of that one-time fill. They are talking the same language in Cheyenne, which similarly has modest amounts of water. Interesting that you know the name Kenesaw. I had the idea that the name may have faded from use.
We “air-condition” our homes w/o evaporating water. Not super-efficiently.
The way I understand water-free cooling in data centers is that the chips themselves can safely run at 160F or so, sometimes hotter. Water is circulated to a heat sink on each of the 500W or so chips. (Lots of plumbing!) So water leaving the chips at 145F or so goes up to a “dry cooler” on the roof. Then, even if it’s 110F on the roof, that water can be cooled down to 125F with the dry cooler fans and a bunch of copper tubing and aluminum fins, and sent back to the chips. No compressor needed, just pumps and kinda pricey HXs.
The rest of the heat in the building is removed with “inefficient” air-cooled AC, but that load is trivial compared to the chips.