Xcel Energy is working on a third large data center development in Minnesota.

In a filing this week with the Minnesota Public Utilities Commission (PUC) first reported by the Star Tribune, the energy company is working with an unnamed Fortune 100 company for an 'enterprise data center', with the interested party investing up to $700 million in the project.

Sherburne County Generating Station Sherco Becker Minnesota - Wikipedia via Mulad.jpg
Sherburne County Generating Station – Wikipedia via Mulad

According to Xcel, the initial data center premise is expected to achieve an initial load of at least 10MW and grow to exceed 75MW by the end of its first 10 years in service.

The Fortune 100 company "wishes to remain unnamed at this time" and working under the name “Amber Kestral”. The company is evaluating several possible locations for the data center, which it would use the facility for its own operations. ‘Amber Kestral’ could end up developing more than one facility.

“The customer believes its parent company identity and any publicization of its name in relation to these contracts could jeopardize securing the necessary land rights for its data center,” Xcel said.

Xcel is already working with two other companies that are looking to develop data centers near its Sherburne County Generating Station (also known as Sherco) in the city of Becker, Minnesota. Whether or not the third company will choose this site or multiple sites is unclear at this time.

The Minneapolis-based utility plans to close three big coal-fired generators at Sherco by 2030. First built in 1976, the coal-powered plant has a capacity of up to 2,238MW and is the largest power plant in the state. The site was initially constructed by Northern States Power Company (NSP), now a subsidiary of Xcel Energy.

Google was first reported as looking at building a $600 million data center on land next to the power plant in 2019; the search giant plans to build a 375,000-square-foot (34,800 sqm) data center on roughly 300 acres of land owned by Xcel.

In February 2022, however, Xcel said during a Minnesota Public Utilities Commission, that Google is still yet to buy the land from Xcel and the company’s option to buy the land expires at the end of this year. Both companies said the project was still on track, however.

In September it was announced a second company, obfuscated using the name Elk River Technologies, is buying 348 acres of land from Xcel near the Sherco plant for a $1 billion data center project.

None of the big three cloud players currently have a cloud region in Minnesota. Microsoft has an Azure region in neighboring Iowa and a Network PoP in Minneapolis. Google also has a region in Iowa. AWS’ nearest cloud region to Minnesota is several states away in Ohio.

Meta has a data center in neighboring Iowa; when fully built out, the Altoona facility will span around 5 million sqft. Apple is also developing its own campus in Iowa.

CloudHQ is planning a 180MW data center campus in Minneapolis, likely for one of the hyperscalers.

Across the country, Xcel operates 13 coal plants with a capacity of 7,697MW; 500MW of hydroelectric power from 27 plants; 110MW of electricity from biomass generators; and two nuclear power plants totaling more than 1,650MW.

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