McKenzie County Seeks Answers on Data Centers

Data centers have become a hot topic throughout North Dakota in recent months, and officials in McKenzie County decided to take a proactive approach to determine fact from fiction.

While the county has not received a single application for a data center, they want to create a regulatory framework so they can navigate potential opportunities. That effort includes discovery trips, public meetings and hiring an environmental health expert.

McKenzie County Economic Development Director Meghan Taunton said the county is in a unique position because while oil and gas development is regulated at a state level, data centers are regulated locally.

"It gives us an opportunity as counties across the state to really develop what works for each county," she said. "That's a unique opportunity that we didn't have during oil and gas development."

Learning from others' mistakes

Sixteen McKenzie County and Watford City officials and stakeholders returned from Cheyenne, Wyoming this spring with a clearer picture of what large-scale data center development could mean for western North Dakota and a firmer sense of what questions they still need to ask. Officials chose Cheyenne because it mirrors McKenzie County's values and economic profile, energy-heavy, agriculture-based, and rural, yet on the front edge of data center growth.

"The idea was to find a city, a community that was kind of a similar mindset, similar values, similar economic structure," Taunton said, noting Cheyenne has been working with data centers since around 2010 and has made mistakes and corrected them.

The group confronted common concerns about noise, water use and appearance. Officials measured about 65 decibels at a modern data center in windy conditions, compared with a much louder crypto mining facility across the road. Newer closed-loop cooling dramatically reduced water use; Taunton said all Cheyenne data centers combined accounted for about 1.2% of city water, including water used for hygiene, with cooling water swapped out roughly every six years, "about the size of an Olympic swimming pool."

The group said the Cheyenne tour overturned assumptions that data centers would be industrial eyesores, describing instead clean, professionally designed facilities with high security and thoughtful landscaping that blended into surrounding business parks. They contrasted these architecturally planned buildings with ornamental fencing and low-water shrubbery suited to the dry climate, against older, noisier crypto operations that appeared more makeshift and less integrated into the community.

County Commissioner Craig Hystad went with the question of why more data centers are needed, and he learned of the expansive storage required within our current technology environment.

"Every time a baby's born, every time somebody dies, all that information doesn't just go away," Hystad said. "Everything we do on our phones and computers - it goes somewhere to be saved. Without more data centers, [storage] will be maxed out. So then where are we going to go? China? No, I don't want my information in China."

"We're even tracking cattle around pastures with either a tag or a collar," Keene Township Representative Nathan Brenna said. "So, at the end of the day, it's harder to find something that we don't need data versus where we use it."

Regulating any large-scale development requires a hard look at utility needs, and Brenna recognizes that McKenzie County doesn't currently have the electricity to support it. But they do have something in surplus that could change that.

"That's when we tie in what we know best - production of natural gas," Brenna said. "I stood within a half mile of a natural gas power generation facility near Cheyenne that was powering part of their grid. And while McKenzie County Electric may just be a western North Dakota cooperative, it has one of the best redundancy systems [for backup power during outages] in America. That redundancy enhancement came from oil and gas investments and that will transfer nicely to other endeavors within the county and western North Dakota."

Following the trip to Cheyenne, McKenzie County hosted an informational open house in June where residents could come ask questions and officials could talk "with them, not to them," Taunton said.

"This whole value-added natural gas and data center education effort is a bit of a multi-approach and this trip to Cheyenne was just one aspect," she said.

The fact-finding continues

McKenzie County and Watford City officials visited Fayetteville, Georgia, in mid-August to tour their 1000-acre QTS Data Centers campus, commonly known as Project Excalibur, to observe its massive energy and infrastructure footprint firsthand. The stark contrast of the urban setting to Cheyenne's prairie landscape gave the McKenzie County delegation a good understanding of what needs to be in place for community protections, the types of jobs created and the importance of working with reputable, transparent partners. But the visit also reinforced the planning McKenzie County already started in 2024 when it created a data center ordinance, and Taunton said the lessons learned from these other locations will help them strengthen that ordinance.

"We want responsible development for all kinds of industry," she said. "Because of our long history of oil and gas development, we have a lot of experience in regulating large water operations, measuring noise and dust - so we look at those things already."

Fayetteville is one of four cities in Fayette County with an active data center. Thanks to robust development plans and regulations surrounding these facilities, all four municipalities will soon eliminate local property taxes for residents.

"These are substantial impacts to communities," Taunton said.

Hiring experts

In addition, McKenzie County hired an environmental health expert to help educate the officials on the effects of low-frequency and infrasonic noise associated with data centers. The report, which will be presented at a special public meeting on September 3 at the McKenzie County Ag Expo, will help the county determine how scientific research and health considerations should inform regulatory limits.

McKenzie County Commissioner Howdy Lawlar said learning from other communities can be helpful, but each county, city and township need to consider its own circumstances and make sure any lessons from elsewhere fit its needs.

"We want to make sure it works for us," Lawlar said. "You can never take that puzzle piece [from another community] and put it in our puzzle because we have different numbers and stuff. My big thing is people need to ask their questions and get the answers."

This story includes reporting from Western Dakota Energy Association.