Nick Phillips of Applied Digital told North Dakota's Artificial Intelligence and Data Center Committee on August 31 that Ellendale "went from about 350,000 dollars a year in sales tax to right now through this month they're at about 4.5 million dollars in sales tax collections." Ratepayer savings from the same campus, he said, are "about 45 million dollars to date in savings for ND ratepayers as a direct result of our project down there in Ellendale that's broken down there's also PSC filings to support that information." The Public Service Commission is the agency on those filings.
Chair Jonathan Warrey is running an interim study committee. The special session that starts September 2 already carries a nondisclosure-agreement bill. A statewide construction pause is not on that calendar.
Ellendale sat on stranded wind
Dr. Robert Mayo of North Dakota State University's Challey Institute of Global Innovation and Growth put Columbia's finding on the table first: "whether new demand will increase or decrease rates depends on how the grid is planned not just whether it's a data center or how large it is." North Dakota has already run both experiments.
Near Williston, he said, the Atlas Power project connected to a grid with no spare capacity. "The cost of added transmission ended up being passed along to local ratepayers in the form of higher bills." The county later asked the utility to cut power. Sen. Jose Castaneda, who sits on the Williston City Commission, corrected the geography on the record: the site "was never in Williston's territory for jurisdiction." City rules already require community-benefit agreements, closed-loop water, and setbacks. "It was a Williams County approval."
Ellendale sat where wind was generating more than the lines could carry. Mayo called that surplus stranded power. "By buying it the facility helped reduce local electric costs they cut costs to consumers by about 5 million dollars in 2023 even as it drew about 180 megawatts from the grid." Phillips's $45 million is the company's cumulative figure, tied to those PSC filings. Mayo's $5 million is the 2023 year. Both are Ellendale.
"Whether a data center raises or lowers your bill comes down to the power plant not to the fact that it's a data center," Mayo said.
Water followed the same split. Closed-loop fills once and recirculates. "In Ellendale Applied Digital's facility uses closed loop cooling and it reports using less water than one average single family home." An older Electric Power Research Institute finding covered a modest buildout. The largest new facilities, "if they outrun the grid's ability to adapt," can land differently. Every project, he said, should show "a credible power plan before it's approved."
Kevin Prenice of the Laborers' International Union of North America builds the boxes. Members work inside them. If the campus is on the grid, emergency backup "almost never" runs. Closed-loop, he said, means "very small amounts of water." Grid upgrades help everyone "as long as you're making the data center pay for the upgrades to the grid that are necessary to serve them." "There's nothing particularly unique or scary that happens inside those concrete boxes that people are worried about."
Counties want the new-growth dollars and the zoning pencil
Aaron Birst of the North Dakota Association of Counties said data-center zoning has been the number-one call from subdivisions for six months to a year. House Bill 1176's property-tax caps exempt new growth. "When the AI center or data center comes into town that will be new growth and those are big dollars" that can sit in a county's baseline.
Cities, counties, and townships hold zoning. "Any attempts to curtail or limit political subdivision authority in particular county authority when it comes to zoning we would object to on the basis of not being good public policy." The association, the League of Cities, and township supervisors already shipped a three-page baseline ordinance. Some counties adopted it. Other counties have written 50-page ordinances that name megawatts.
Phillips put the property-tax path the counties are underwriting on the table. "We have about 3,500 construction workers today on our sites" and "over 250 current North Dakota employees." "We anticipate by 2029 we'll be the largest single property taxpayer in the state of North Dakota," "at least $24 million a year" off land that had been paying hundreds or low thousands. About 40 states already run a similar sales-tax exemption on the equipment. "If we spend 0 dollars if there's no dollars spent in this state on that equipment you still get zero."
Rep. Anna Novak tested those credits against a rate case. She had Montana-Dakota Utilities at about $32 million a year in rider credits from Applied Digital's Ellendale Polaris Forge 1 site, and about $250 a year back to each residential customer at full build, "which which is great but MDU also is requesting a 14.5% rate increase" and asked how both can be true at once. The answer on the tape was other generation and reliability spend already in the system, on plans that predate any one campus.
Public comment asked for a pause. The special session has the NDA.
Sandra Larson asked for "a temporary data center permit moratorium" so the State Water Commission can study use and the legislature can force disclosure. Sydney Snartland, a District 33 senate candidate covering Oliver, Mercer, McLean, and Morton, put the 2015 and 2021 sales-and-use exemptions at $94.5 million "so far" and said "moratoriums and public involvement work." Casselton City Council President Sam Wagner, speaking for himself, thanked members for moving a no-NDA bill covering industrial projects and said a legislative committee had already voted down a pause through June 30, 2027.
Warrey ran a five-minute clock, parked applause, and put every handout in the minutes. He did not take a pause vote. September 2 is the NDA bill. A statewide freeze is not on that calendar.
Citizen member Mark Hagerott asked whether Gov. Greg Abbott's pause means Texas lacks the regulations North Dakota thinks it has. "Texas has over 300 data centers right now another 200 are coming or getting close online," and "there's been a lot of talk about a moratorium here in North Dakota."
James Dickey of JD Key Consulting, who publishes this site and disclosed he has no North Dakota data-center client, was in the 9:55 a.m. slot. The 2025 Texas legislature passed Senate Bill 6 with deposits and curtailment, and in the same session a separate law requiring an annual Public Utility Commission water-use survey. "82% of those being surveyed did not respond to the survey." What the governor ordered, he said, "was a pause on the announced release of who was going to be approved to proceed in the batch zero evaluation" until attestations can be audited.
Who recovers the lumpy wire
Public Service Commissioner Randy Christmann took the ratepayer-protection pledge President Trump announced and asked who enforces it. "First of all I don't know who's supposed to enforce that." Regional transmission organizations dispatch for least-cost energy. A later high-voltage line built because load showed up is recovered from everyone unless the tariff says otherwise. Generation is lumpy. Fill a utility to the last megawatt, then "someone wants to build a little fertilizer plant that's going to be 15 or 20 megawatts" and the spare is gone. "Did the data center cause that or did the little egg processing plant cause it." He has already seen data centers in North Dakota "that have elevated costs for customers."
Jonathan Fortner of the Lignite Energy Council put the other side of that lump. The Midcontinent Independent System Operator, covering 15 states, sits at about 121 GW of annual peak with large-load interest on the order of 20 GW. Those large loads want to connect in 18 to 36 months, faster than plants and lines. Southwest Power Pool large-load requests have nearly tripled, about 11 GW in and about 30 GW in the next cycle. "Large new load would equal more electricity sales which would drive the capacity factor." Higher utilization "does lower the overall cost to produce," which means more tons mined, more jobs, more tax. A campus on a plant that already exists can spread fixed costs. A campus that forces a stranded line cannot.
The live fights are the NDA rule, county zoning plus the new-growth exemption Birst said is already paying, and an interconnection contract that names who pays for the wire before the first shovel. Applied Digital bought stranded wind in Ellendale. Williams County ratepayers paid for added transmission. Phillips's $45 million is either in the Public Service Commission filings or it isn't.
Watch the Bismarck cut: video.ndlegis.gov
Sources
- North Dakota Legislative Management, Artificial Intelligence and Data Center Committee, August 31, 2026, Brynhild Haugland Room. Archive: https://video.ndlegis.gov/en/PowerBrowser/PowerBrowserV3/20260831/-1/35061. Official captions, 9,758 English cues, 9:00 a.m. to 4:02 p.m. CDT. Civic YouTube upload is still pending from the 7.88 GB capture.
- Witnesses and commenters quoted: Dr. Robert Mayo, Challey Institute; Nick Phillips, Applied Digital; Kevin Prenice, LIUNA; Aaron Birst, North Dakota Association of Counties; Commissioner Randy Christmann, Public Service Commission; Jonathan Fortner, Lignite Energy Council; Chair Jonathan Warrey; Sen. Jose Castaneda; Rep. Anna Novak; citizen member Mark Hagerott; Sandra Larson; Sydney Snartland; Casselton City Council President Sam Wagner; James Dickey, JD Key Consulting / Hyperscale News, 9:55 a.m. invited slot, no North Dakota data-center client on the record.
- Agenda 27.5194.02000. Meeting notice 27.5194.01000. Legislative Council background memo 27.9237.01000. Caption n = 9,758. Audio capture 7h 9m 40s. Quotes from the official caption feed with proper-noun cleanup.