Data Center Siting: Key Factors and Future Directions

Data centers power our digital world, and as these facilities become even more critical to everyday life, the question of where and how to build them becomes more urgent. Selecting the right location is complex and involves everything from power availability and network connectivity to environmental risks and community relations.  

Below, we examine the key factors shaping data center siting and explore emerging trends defining the next generation of digital infrastructure. 

Power Availability and Reliability

Reliable and consistent power is the backbone of any successful data center. For developers, initiating early and proactive dialogue with utility providers is vital for clarifying infrastructure capacities, aligning project timelines, and uncovering opportunities for integrating renewables or other interim power options. 

In locations with easy access to substations and robust power grids, developers can often minimize costly infrastructure upgrades. Redundant power systems — such as uninterruptible power supplies and standby generators — act as additional safety nets against potential disruptions.  

Connectivity and Network Infrastructure

Data centers thrive on connectivity. Proximity to high-speed networks and multiple internet service providers ensures low latency and reliable data transfer. Redundant network paths further enhance operational resilience and protect against outages. 

Northern Virginia, often dubbed the “Data Center Capital of the World,” has an unparalleled connectivity infrastructure, handling much of the world’s data traffic. The region’s status has made it a magnet for technology companies seeking robust network ecosystems and a skilled local workforce. 

Climate and Natural Disaster Resilience

Geographical considerations significantly impact operating costs and risk management. Cooler climates can naturally reduce cooling expenses, but other weather and geological factors also come into play. Natural disasters pose substantial operational risks, driving the adoption of advanced risk analysis tools to identify safer zones. 

These weather and disaster-resilience considerations increasingly intersect with corporate sustainability goals. Businesses are prioritizing locations and technologies that minimize environmental footprints while still meeting stringent uptime requirements. 

Regulatory Environment and Incentives

Local and regional policies can make or break a data center project. Tax incentives, expedited permitting, and supportive regulatory frameworks accelerate development and reduce overhead. As sustainability goals become more pressing, regions offering clean energy infrastructure or attractive carbon offset programs gain a competitive edge in attracting data center investments. 

Stakeholders are also looking closely at water efficiency and renewable energy sourcing, making local governments that prioritize sustainability a powerful draw for many developers.  

Water Accessibility

Water availability is critical in many data center designs, particularly those relying on evaporative cooling. A 50 MW IT load facility may consume hundreds of millions of gallons of water annually. To ensure long-term viability, developers must assess regional water supply, infrastructure capacity, and sustainability strategies such as reclaimed water and water-efficient cooling systems. 

Addressing these issues proactively, through partnerships with local utilities and compliance with environmental regulations, helps data centers manage resources responsibly and mitigates operational risks related to water scarcity. 

Fuel Supply for Backup Generation:

Even the most advanced data centers rely on backup power to avoid downtime during grid outages. Easy access to cost-competitive fuel sources, such as natural gas, can make certain regions particularly attractive. North Dakota and Texas, for example, have drawn data center developers partly due to their abundant natural gas supplies, reduced transportation costs, and lower risk of supply chain disruptions. 

Buildable Land and Workforce Considerations

Large, strategically located sites close to urban centers offer a dual advantage. First, they provide the necessary space for sprawling data center campuses. Second, they tap into a local pool of skilled engineers, IT professionals, and support staff. For data centers that operate around the clock, ready access to specialized talent is as important as physical infrastructure. 

Data Siting in 2025 and Beyond  

The global data center market shows no sign of slowing down. From reliable power and network infrastructure to evolving sustainability practices, today’s site selection decisions carry weighty implications for business growth and environmental stewardship.  

At EPE, we believe that navigating these complexities calls for a holistic, forward-thinking strategy. By combining deep technical expertise with proactive stakeholder engagement, developers can build data centers that are both profitable and responsible stewards of local communities and resources. 

Ready to optimize your data center strategy? Our team of engineers, planners, and consultants are ready to guide you through every step, from feasibility studies and site selection to designing future-proof, sustainable operations. Let’s shape the digital landscape together.