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Released May 27, 2025 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Amazon.com Incorporated (Seattle, Washington) has scrapped plans for a data center planned in Becker, Minnesota, near Xcel Energy Incorporated's (Minneapolis, Minnesota) retiring Sherburne County (Sherco) coal-fired power plant. Certain aspects of the project have raised eyebrows, from the sale of the land to Amazon to the company petitioning for environmental regulations to be bypassed.
The land on which the data center was planned was previously owned by Xcel. In April 2024, Xcel sold a 348-acre parcel to a recently incorporated company called Elk River Technologies LLC for $7.7 million. Xcel did not hold a competitive bidding process, as the sale price matched a current appraisal and the buyer had promised that the site would be used for a large data center that would obtain power from Xcel.
Elk River Technologies turned out to be a subsidiary of Black & Veatch Incorporated (Overland Park, Kansas), which had carried out consulting work at the Sherco site. Seven months later, Elk River sold the land to Amazon for $73.5 million, nearly 10 times the price Xcel had obtained. The Minnesota Star Tribune first reported the story in January.
The flipping of the land for a much higher sale price raised eyebrows among state regulators, with the Minnesota Public Utilities Commission (PUC), which had approved Xcel's initial sale, seeking answers to questions such as if Xcel "or any of its executives have any relationship with Black & Veatch" and wanting to be informed of any other future land sales the company has in the pipeline. Annie Levenson-Falk, executive director of the watchdog Citizens Utility Board of Minnesota, told the Star Tribune, "It's disappointing to see that Xcel ratepayers might have received many millions of dollars more in this land sale. It sure would have been nice to have that $65 million, especially when Xcel is asking to raise rates yet again."
(In Minnesota, Xcel has requested a 9.6% increase in rates for 2025 and another 3.6% in 2026, adding up to a 13.2% increase over two years. In January, the PUC approved an interim 5.2% increase for 2025.)
After Amazon bought the parcel in late 2024 with plans to build a data center, the company raised more eyebrows at the PUC when it petitioned the regulator to operate up to 250 diesel-fired backup generators exempt from certain regulatory oversight, claiming that as the company is not a utility and the generators will not be connected to the grid, they should be exempt from a rule requiring extra oversight of power generation projects. In March, the PUC denied the request, stating that the generators would need to go through proper regulatory channels. For more information, see March 4, 2025, article - Amazon Denied Diesel Generator Exemptions for Data Center Near Minnesota Coal-Fired Site. Amazon sought to overturn the ruling in the state legislature by easing some of the requirements proving a need for backup power.
Instead, Amazon was greeted with more unwelcome legislation when state lawmakers and Governor Tim Walz (D) said they will reduce the sales tax exemption that data centers receive on their purchased electricity, although they would keep exemptions in place for other equipment such as servers and cooling equipment. That news seems to have been the proverbial straw that broke the camel's back, prompting Amazon to issue a statement saying that due to the uncertainty surrounding permitting and utility agreements "we are redirecting more of our resources to focus on other projects that can provide capacity to our customers more quickly."
Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can learn more about the project by viewing the related project reports.
Amazon's pullout from Becker is not the first time the city has lost a large data center project. Google Incorporated (Mountain View, California) announced it would build a data center in the city in 2019, only to pull back in 2022, seemingly without much of an explanation.
But for Minnesota as a whole as well as Xcel, all hope for data centers in Minnesota is not lost. Several players are considering building facilities in the state, and one of the biggest names in tech, Meta Platforms Incorporated (Menlo Park, California), is underway with a new facility in Rosemount, about 70 miles from Becker. Meta is underway with construction of the first two buildings, both of which are expected to be completed this year, with more planned. Xcel will provide the facility's power. Subscribers to Industrial Info's GMI Project Database can learn more by viewing the related project reports.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
The land on which the data center was planned was previously owned by Xcel. In April 2024, Xcel sold a 348-acre parcel to a recently incorporated company called Elk River Technologies LLC for $7.7 million. Xcel did not hold a competitive bidding process, as the sale price matched a current appraisal and the buyer had promised that the site would be used for a large data center that would obtain power from Xcel.
Elk River Technologies turned out to be a subsidiary of Black & Veatch Incorporated (Overland Park, Kansas), which had carried out consulting work at the Sherco site. Seven months later, Elk River sold the land to Amazon for $73.5 million, nearly 10 times the price Xcel had obtained. The Minnesota Star Tribune first reported the story in January.
The flipping of the land for a much higher sale price raised eyebrows among state regulators, with the Minnesota Public Utilities Commission (PUC), which had approved Xcel's initial sale, seeking answers to questions such as if Xcel "or any of its executives have any relationship with Black & Veatch" and wanting to be informed of any other future land sales the company has in the pipeline. Annie Levenson-Falk, executive director of the watchdog Citizens Utility Board of Minnesota, told the Star Tribune, "It's disappointing to see that Xcel ratepayers might have received many millions of dollars more in this land sale. It sure would have been nice to have that $65 million, especially when Xcel is asking to raise rates yet again."
(In Minnesota, Xcel has requested a 9.6% increase in rates for 2025 and another 3.6% in 2026, adding up to a 13.2% increase over two years. In January, the PUC approved an interim 5.2% increase for 2025.)
After Amazon bought the parcel in late 2024 with plans to build a data center, the company raised more eyebrows at the PUC when it petitioned the regulator to operate up to 250 diesel-fired backup generators exempt from certain regulatory oversight, claiming that as the company is not a utility and the generators will not be connected to the grid, they should be exempt from a rule requiring extra oversight of power generation projects. In March, the PUC denied the request, stating that the generators would need to go through proper regulatory channels. For more information, see March 4, 2025, article - Amazon Denied Diesel Generator Exemptions for Data Center Near Minnesota Coal-Fired Site. Amazon sought to overturn the ruling in the state legislature by easing some of the requirements proving a need for backup power.
Instead, Amazon was greeted with more unwelcome legislation when state lawmakers and Governor Tim Walz (D) said they will reduce the sales tax exemption that data centers receive on their purchased electricity, although they would keep exemptions in place for other equipment such as servers and cooling equipment. That news seems to have been the proverbial straw that broke the camel's back, prompting Amazon to issue a statement saying that due to the uncertainty surrounding permitting and utility agreements "we are redirecting more of our resources to focus on other projects that can provide capacity to our customers more quickly."
Subscribers to Industrial Info's Global Market Intelligence (GMI) Project Database can learn more about the project by viewing the related project reports.
Amazon's pullout from Becker is not the first time the city has lost a large data center project. Google Incorporated (Mountain View, California) announced it would build a data center in the city in 2019, only to pull back in 2022, seemingly without much of an explanation.
But for Minnesota as a whole as well as Xcel, all hope for data centers in Minnesota is not lost. Several players are considering building facilities in the state, and one of the biggest names in tech, Meta Platforms Incorporated (Menlo Park, California), is underway with a new facility in Rosemount, about 70 miles from Becker. Meta is underway with construction of the first two buildings, both of which are expected to be completed this year, with more planned. Xcel will provide the facility's power. Subscribers to Industrial Info's GMI Project Database can learn more by viewing the related project reports.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 trillion (USD).
