Company announces plan for $3 billion data center north of Fargo

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A rendering of the planned data center near Harwood, North Dakota. (Courtesy of Applied Digital)
Applied Digital, the company operating data centers near Ellendale and Jamestown, on Monday announced plans to build a $3 billion data center at Harwood, north of Fargo.
Applied Digital plans to break ground in September on what it calls Polaris Forge 2, a 280-megawatt artificial intelligence computing center.
The plan calls for two facilities with room for expansion. Applied Digital has contracted more than 900 acres for its campus and secured power through Cass County Electric Cooperative, a member-owned nonprofit. The data center is expected to employ more than 200 full-time workers plus long-term contractors.
Nick Phillips, executive vice president of Applied Digital who works from the Ellendale campus, said the data center will not use the entire 900 acres with the initial build. He said the buildings will be just over 900,000 square feet, a little smaller than the Amazon distribution center between Fargo and Harwood.
The site will be just south and east of Harwood, a town of about 800 people.
The first part of the facility will be operational in the second half of 2026 and phase two operational in 2027.
AI driving data center demand at accelerating pace
Applied Digital said in a news release that it is expanding in North Dakota because the state has abundant energy, available land and a pro-business climate.
'The demand for AI capacity continues to accelerate, and North Dakota continues to be one of the most strategic locations in the country to meet that need,' Wes Cummins, CEO of Applied Digital, said in the news release.
'Applied Digital's investment reflects confidence in our people and our potential, and we're proud to be part of this moment,' Harwood Mayor Blake Hankey said in the news release.
Phillips, in an interview, said he hears concerns about utility bills rising because of the data center, but that has not been the case for Ellendale. He said Montana Dakota Utilities customers have gotten rebates because of the Ellendale center.
He said the center also will not affect the reliability of power for Cass County Electric customers.
Cass County Electric Cooperative is a member of Grand Forks-based Minnkota Power Cooperative.
'Our focus is on making sure it is integrated in a way that strengthens our communities, supports reliable and responsible power, and builds on the strong foundation we have established through more than 85 years of service to this region,' Mac McLennan, Minnkota Power Cooperative president and CEO said in the news release.
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Phillips said while some data centers can use a lot of water, the closed-loop water cooling system that Applied Digital uses at Ellendale and plans to use at Harwood uses very little.
He said people are also concerned about noise, but that at a half mile from the center, the noise level should be similar to rustling leaves or a light rain.
At 280 megawatts, the Harwood data center will be about half of what Ellendale is permitted for, but the company says it may be able to expand in the future.
Applied Digital has invested in housing and other improvements in Ellendale, a town of about 1,100 near the South Dakota state line, where it operates Polaris Forge 1.
'North Dakota wins when companies like Applied Digital choose to be more than an employer.' Gov. Kelly Armstrong said in the news release. 'In Ellendale, they invested in people through workforce housing and created strong local partnerships that strengthen the community.'
Applied Digital data centers house banks of computers owned by tech companies that provide artificial intelligence and other services.
The tech companies lease space from Applied Digital, which builds climate-controlled facilities to keep the computers cool, clean and operating efficiently.
Phillips spoke last week in Fargo at an artificial intelligence summit organized by the Fargo Moorhead West Fargo Chamber.
He said data centers are beneficial to communities, providing good jobs for people in the skilled trades, such as electricians, and adding to the tax base.
Applied Digital, with a campus just outside of Ellendale, requested to be annexed into the town to increase tax revenue for Ellendale. Phillips said Monday that it was not decided yet if the data center would added to the Harwood city limits but that those discussions were taking place.
At the AI summit, U.S. Rep. Julie Fedorchak said North Dakota's ability to provide power and a home for data centers is important for national security.
'Where I see incredible opportunity for North Dakota is using that resource, the incredible energy resources we have to help provide the power to develop this incredible industry here in America, not over in India and China,' she said.
This article has been updated with additional information.
North Dakota Monitor Deputy Editor Jeff Beach can be reached at [e-mail].
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