North Dakota Wrestles With Who Controls AI Data Center Construction on Farm and Ranch Land
Why It Matters
North Dakota is at the center of a rapid, largely unregulated expansion of artificial intelligence data center infrastructure that is reshaping agricultural land, straining power grids, and raising transparency concerns at the local government level. The state currently has no centralized oversight body, no formal environmental review process, and no statewide permitting framework for these facilities — leaving counties and townships to manage billion-dollar tech projects largely on their own.
What Happened
Tech companies have moved aggressively into rural North Dakota, converting farmland into large-scale data center campuses that support AI computing operations. The only formal approval required before construction begins is a local permit from county commissions or townships. No state agency has authority to approve, deny, or formally review data center siting decisions.
At least four western North Dakota counties imposed temporary construction moratoriums on AI data center projects, though some have since lifted those bans. Residents in communities including Harwood and Ellendale have raised concerns about grid reliability, environmental impact, noise, and lack of public notice before major projects break ground.
A prominent example of inadequate planning emerged in Williston, where a large data center consumed more electricity than the local grid was producing, contributing to higher energy bills for residents and prompting a lawsuit over noise levels. Public Service Commission Chair Randy Christmann said he learned of that facility only after it was already built — a situation he described as deeply troubling given that the region already had grid congestion problems.
During the most recent legislative session, a bill was introduced that would have required data center developers to obtain a certificate of public convenience and necessity before building. The measure was opposed by industry groups and electric cooperatives, and ultimately passed in a narrowed form as a study on the impact of large energy consumers on the state’s electrical grid — stopping short of enforceable regulation.
By the Numbers
- 4+ western North Dakota counties have imposed temporary bans on AI data center construction
- 2 miles — the distance one Harwood-area resident lives from Applied Digital’s active construction site
- 1 campus — Applied Digital’s Ellendale facility is positioned to consume surplus power that has historically contributed to rate increases when unused
- 2027 — the earliest the state Legislature is expected to address nondisclosure agreement requirements for local governments
- Months of advance notice were given to local officials and planners about the Harwood project before any public announcement was made
The Transparency Problem
A recurring flashpoint in the debate is the use of nondisclosure agreements between data center developers and local government officials during the planning phase. Local leaders are frequently asked to sign these agreements before project details are made public — sometimes months before residents are informed.
In Harwood, community members protested after learning that local officials had been aware of Applied Digital’s planned campus for months while the public was kept in the dark. Permitting was already underway and a groundbreaking was weeks away by the time residents found out.
Association of Counties Director Aaron Birst acknowledged the tension, saying some proprietary information may warrant protection, but that details about the basic footprint of a large data center campus should not be treated as competitively sensitive. “It’s completely unfair that public officials can’t say anything about it until the approval process,” he said.
Zoom Out
North Dakota’s situation reflects a national pattern. Across the country, rural and suburban communities are grappling with the rapid arrival of hyperscale data center infrastructure tied to AI demand, often with limited zoning frameworks in place to manage the scale of development. Debates over grid reliability, local control, and tax incentives for tech companies have emerged in states from Virginia to Texas. The tension between economic development and local oversight is also playing out in infrastructure and disaster management contexts, where federal task forces have recently recommended shifting more authority to states rather than centralizing control.
Industry advocates in North Dakota argue that a standardized local ordinance framework — rather than state-level regulation — is the right model, warning that a statewide permitting regime could deter future investment. The League of Cities and Association of Counties have jointly developed a model ordinance for local governments to use when planning for large-scale tech campuses.
What’s Next
The state Legislature is not expected to take up NDA restrictions or formal data center oversight requirements until its 2027 session. In the interim, the tech industry advocacy group TechND is assembling an education coalition to hold town halls in affected communities and inform landowners about data center infrastructure.
The Public Service Commission has signaled interest in being included in a formal advisory role during the planning process — not as a final approving authority, but as a resource for evaluating grid impact before construction begins. As Congress continues to navigate its own infrastructure and spending debates, the question of federal involvement in data center siting — including grid reliability standards — remains unresolved at the national level as well.