Editorial: Paul Matthys

Data centers, specifically AI factories, have been the latest hot topic in the energy industry. Until recently, I didn’t know exactly what an AI factory was or why anyone would want to put one on our system, let alone in North Dakota. So, I typed in “what is an AI factory” in the Google search box and got this for an AI overview.

“An AI factory is a specialized computing infrastructure that handles the entire AI development lifecycle, from data ingestion and model training to deployment and inference at scale. It integrates advanced hardware, such as GPUs and high-speed networks, with software and workflows to automate the creation of actionable AI models and intelligent solutions from raw data, similar to how a traditional factory produces physical goods. The output of an AI factory is intelligence, enabling businesses to develop AI-powered applications and gain a competitive advantage.” – Google AI Overview.

AI factories use high-performance GPUs and powerful servers, which generate a lot of heat. North Dakota’s cold climate is suitable for large data centers, as it significantly reduces cooling costs. When conditions are right, they use economizers for “free cooling” by pulling in outside cooler air to reduce the need for mechanical refrigeration.

As you may already have heard, Cass County Electric plans to serve a large AI factory being built and run by Applied Digital near Harwood, North Dakota. Who is Applied Digital? Applied Digital (Nasdaq: APLD), named Best Data Center in the Americas 2025 by Datacloud, is a next-generation digital infrastructure company that designs, develops, and operates high-performance data centers and colocation solutions for artificial intelligence, cloud, networking, and blockchain industries. Founded in 2021 and headquartered in Dallas, Texas, the company blends hyperscale development expertise with proprietary waterless cooling technology and sustainable engineering practices to deliver secure, scalable computing capacity at unprecedented speed and efficiency.

Since the announcement of Applied Digital’s AI factory on Aug. 18, I have been visiting and engaging with members who have questions and concerns about the cooperative serving a large, energy-consuming load.

Serving Applied Digital’s AI factory will not raise your electricity rates. We have the energy and capacity secured to serve this load. Additional resources might need to be built in the future, but Applied Digital will pay for them as needed. We can leverage this load and other large energy consumers to help pay for fixed costs, which will reduce the upward pressure that we are already facing on electric rates.

There are a few questions about whether this AI factory will cause rolling blackouts or brownouts, and whether it is using up all the grid capacity. The answer is no. Applied Digital will have backup generation for redundancy for the entire facility. If there is a strain on the grid or a power shortage, they will be forced to transfer from utility power to their backup generators.

Cass County Electric and our board of directors will continue to ensure that we prioritize the needs of our members and provide affordable and reliable electricity. We will continue to look for ways to grow, promote economic growth, and give back to the communities we serve.