Economic developers have spent decades trying to diversify Wyoming’s economy away from the volatile boom-and-bust cycles of its coal, oil and gas industries. Tech infrastructure — data centers — seemed like the answer, and is something the state’s been pursuing for the last 20-plus years.
Now that data centers are finally racing toward the state’s wide-open prairies and cheap power, however, the rush is forcing a choice. How much growth is Wyoming will to accept, and at what cost to power bills, water supplies, and its wide-open spaces?
Wyoming wants high-paying jobs and more housing so it has a future for its children. It loses 70% of its youths by the time they’re 30, according to state officials.
But, at the same time, it also wants quiet prairie, low power bills, and tight control over scarce water supplies. Each new data center is a tug on all those resources.
To longtime Cheyenne attorney and Councilman Larry Wolfe, this tension is actually nothing new. Wyoming has long been a place where its residents understand that boom almost always precedes bust and broken promises. Many have thus learned to be skeptical of promises and promise makers.
In fact, the bigger the promise is, the higher the skepticism goes.
“This is exactly the discussion that went on all over the state as we’ve seen all of our energy booms and busts that we’ve endured,” Wolfe told Cowboy State Daily in a previous interview. “And I think people are a bit schizophrenic about this, because they live in Wyoming for a reason.”
Sometimes those reasons are fairly simple. It falls somewhere between knowing your neighbors and having a short drive to get away from them all to a place where the night sky is clean and clear and the Milky Way can be seen.
Holding onto that is about preserving a quality of life that has not only drawn people to the state but kept them here. And it’s about making sure the price paid for such treasure doesn’t come too cheaply.
“This is just another long cycle of that over the years,” Wolfe said. “It’s just the way Wyoming is. We’ve always had this sense that we want to maintain the Wyoming that we have. But we also realize that it’s not sustainable without all of these things coming in, making these huge investments, and putting our people to work, and then building the housing that will, in fact, accommodate that.”
For Wolfe, data centers are just the latest boom-time bargain, promising investment and jobs while testing how much Wyoming is willing to change.
Wyoming's 'Paradox Of Plenty'
Today’s push-pull on data centers has an element of deja vu for economic developers, too.
Wyoming Business Alliance President Renny MacKay agreed with Wolfe that the conversation is really nothing new. The best illustration of that is found in former Gov. Dave Freudenthal’s book, “Wyoming: The Paradox of Plenty."
“He explains it well,” MacKay told Cowboy State Daily. “The tension between that and diving into when the coal industry came to Wyoming. There was a lot of concern about that.”
That happened around the same time as the cattle bust of the 1980s, MacKay said, and has led to an iconic bumper sticker often referenced in Wyoming.
“Dear God give me one more boom,” the bumper sticker goes. “And I promise not to piss it all away next time.”
Skepticism when it comes to economic development is not necessarily bad, MacKay added, particularly if an effort isn’t private-sector led.
“Sometimes you’ve got to take some bets,” he said. “But what we’re seeing now that I think is so positive is the private sector is trying to lead this. Data centers aren’t coming here and asking for any sort of land donation or incentive to come at this point. The conditions, the economic conditions, are in a great place for us to attract some new industries.”
That doesn’t have to just be data centers, MacKay added. Done right, it could also lead to other developments as well. The new nuclear power plant in Kemmerer is an example, as is the nuclear fuel production plant that’s coming to Gillette.
“They’re not coming here and saying, ‘If you invest in our company, then we can grow in Wyoming',” MacKay said. “That’s why I think the business industry sees so much opportunity right now in Wyoming’s future.”
Growth, MacKay added, is key to Wyoming’s future, even if there might be challenges.
“To some degree, you have to take a step back and look at the forest,” he said. “There are so many people who are excited about this moment. They see that their livelihoods are being improved. They’ve got jobs, they’ve got family members who’ve got jobs. So when we’re talking about building Wyoming and attracting people who want to invest in Wyoming as individuals and families, they’re wealth generators and they want to help make this state and our communities more prosperous.”
Making life great for the next generation is the bedrock of MacKay’s own personal motivation.
“I look out at my own kids, right,” he said. “Or even my neighbor’s, too, and my peers. They’re starting to see more opportunity in Wyoming, where they don’t have to leave to find a great job. So let’s stay focused on the positive, because I think more people do truly want job creation in Wyoming and want higher-paying jobs that we’re starting to see happen.”
We Can Absolutely Do This — Again
Crook County rancher and former state legislator Tyler Lindholm with Americans For Prosperity gets both ends of the spectrum. He absolutely wants to see Wyoming hang onto what makes it the Cowboy State.
It’s fair, he added, to question the guardrails around important issues like power consumption and water use.
“Wyoming is fantastic at producing energy,” Lindholm told Cowboy State Daily. “Clearly, these data centers recognize that. So, I think it’s fair to bring up certain scenarios. I mean, when people talk about their rates being affected because of a new, large industrial load coming in, I think it’s fair to bring up that concern and let the company address that. Let the local utility address that, and if they won’t address that, by golly, let’s pass a law ensuring that you are only going to pay for what you get. Those types of scenarios are completely fair.”
But “screaming and shrieking to hear themselves scream and shriek” in an election year isn’t coming from a “principled standpoint,” Lindholm said.
There’s a distinction between policy-focused criticism and what he sees as election-year theatrics, he added.
“We need to let the economy work,” he said. “And I think we can have our cake and eat it, too. We can do responsible development and see the economic growth and be a beneficiary of it.”
Not through moratoriums to shut down business, or aggressive zoning crafted to choke business out — both proposals that have surprised Lindholm in a deeply conservative state.
That kind of approach, he added, is not what Wyoming is best known for. The state is better known for everybody putting “heads together” and coming up with a plan that preserves what’s important while allowing economic prosperity.
That’s what the state did when it was developing its bedrock energy industries. That’s what Lindholm hopes to see happen with data centers, which want to rely on and help bolster the state’s legacy energy industries.
“Maybe I’m too optimistic that we have the capability to do big things and make big plans, but I think if they — and outfits like Microsoft have been outspoken that they’ve got those situations handled,” he said. "I think it’s also fair to say, 'OK, well let’s make that part of the deal'. Let’s put it in law and make it so that it covers every data center that’s even already in place.”
At the same time, lawmakers could also handle other issues, Lindholm added, such as making it illegal for elected officials to sign NDAs with private companies.
That kind of secrecy isn’t the right approach, Lindholm added.
“This is 2026, the age of information, where anybody can look up anything at the drop of a hat,” Lindholm said. “So maybe this is a lesson to big business, big industrial loads, is to get out in front of this, talk about it publicly, and talk about how you’re not going to raise electricity rates.”
Lindholm’s bottom line is that Wyoming should write clear rules on rates, transparency and water use, so new projects can enter the state smoothly.
Businesses Want Guardrails, Too
Lindholm wasn’t the only voice across the state suggesting it’s important to strike the right balance for incoming data centers.
Business owners, too, are largely supportive, but also want to see that thought has been put into appropriate guardrails.
“I’m pro data center, but I’m not pro reckless development,” Frog Creek Partners owner Brian Deurloo told Cowboy State Daily. “I’m not blind to the impact of data centers, but I’m saying Wyoming should lead solutions. Water, power, heat, workforce, land impacts need to be engineered and negotiated upfront.”
Cheyenne business owner Tighe Fagan, who leads an enterprise software and IT consulting company called Gannett Peak Technical Services, told Cowboy State Daily data centers probably wouldn’t be his first pick, so he understands everyone’s pain with a lot of boxy-looking warehouses taking up space.
“It’s not the way they exactly want it,” he said. “But to me it’s like, well, we want diversification, and this is a vector into that.”
The plus side to multiple data centers, though, is more career flexibility for that sector, which can help businesses like his with recruitment and retention of Wyoming youths.
“I’m trying to recruit people out of the university to come work at my company, so I want an ecosystem where they can come and there’s agglomeration,” he said. “That’s where you have options. Like, OK, if we get a bunch of data centers, well then the people working at Google can jump over to Microsoft.”
For Fagan, a certain level of “agglomeration” means graduates will be more likely to build careers in Wyoming instead of leaving.”
Are Data Centers Paying Their Fair Share?
One of the central questions some lawmakers are asking is whether Wyoming is taxing data centers appropriately.
State Sen. Cale Case has been among the most outspoken voices on that front.
Wyoming’s tax structure was crafted when the state didn’t have much experience with data centers.
“We had no idea how much money it was actually going to cost us,” Case said. “And we didn’t think through that very well.”
The employment stats from a data center, once built, are small, Case said, while its demands on resources are potentially outsized when it comes to power consumption. That’s true even if data centers adopt a “bring your own power” mentality, because they’ll be using substantial resources from one or another commodity market, he said.
Even if data centers adopt a “bring your own power” mentality, they’ll be using substantial resources from one or another commodity market. That means they’ll still have impacts on the overall marketplace even if they build their own power generation.
That has him questioning just how good they are for economic development, which was the original rationale for the state’s sales-tax break.
In his view, Wyoming is giving up significant tax revenue in exchange for relatively few permanent jobs, and a potentially heavy load for power and other systems.
“I’m not sure that we’re being negative when we say, ‘This is not living up to what we thought it would',” Case said. “I’m not sure that’s what we mean when we say, ‘We’re open for business'.”
The economic development Wyoming wants is more related to having kids in schools and vibrant communities, Case said. And vibrant communities mean having data centers pay for the impact of their presence.
“What is the value of the servers?” he said. “You could find that out by the property tax, and then you could multiply them by the sales tax that’s been foregone, which is 8%, and then just ask yourself if that’s worth it.”
Reining In Boom Could Soften Bust
Thirty-five other states have data-center tax breaks like Wyoming’s, he added, which has contributed to a race to the bottom, with each state vying to outdo the other to lure data centers.
“My gut tells me that these guys just want to build these things,” Case said. “They don’t really care about the cost. They don’t care if they have to completely go to a closed-loop cooling system. They don’t care if they have to build their own electricity. They want it so bad, and I just don’t think that they need our sales tax break.”
What Case wants to do is work on eliminating the break across the country.
“Then data centers will be even better for our communities, because they’ll be contributing to community infrastructure,” Case said.
And if the state’s data center boom ultimately goes bust, it will also mean the state is on stronger footing to deal with any fallout.
Analysts, Case added, are estimating new data center construction of upwards of 3,000 facilities on top of an existing 4,000. Those new builds will be exponentially larger than anything previous.
But does that match the real need? Or does it represent overbuilding, as some analysts think?
“There’s got to be a market for data processing, right?” Case said. “I mean, there’s implicit price in there. There are companies that are searching for it. There’s demand that’s growing. There’s supply factors. so the question is, could we get overextended? Could we have overbuild? And actually this is what happens with virtually anything else. You have rampant people trying to enter a market, whether it’s planting corn or the big boom in whatever we’re talking about. It always ends. It never goes on forever.”
The question then becomes, who is left holding the bag, and what will that mean for the communities involved.
“That’s another reason to not have soft tax breaks that exacerbate (the situation),” Case said. “We need to try to steady things out. We really ought to be talking to other states about joint policies, instead of pursuing this zero-sum game of you put in a tax break, so I got to put in a tax break. Everybody puts in a tax break. Then we all end up getting nothing when they’re willing to pay, and they’re not impactless.”
Case is not arguing against data centers but against subsidies that, in his view, magnify risk if the boom ultimately goes bust.
An Important Crossroads
Wyoming, Gov. Mark Gordon told Cowboy State Daily during a recent data center tour in Cheyenne, stands at a crossroads, one that will define its future.
He’s advocating that Wyoming embrace the opportunity, and work on the challenges together.
“I remember when the saying was, ‘Please God, give me another boom. I promise not to waste it this time',” Gordon told Cowboy State Daily. “And you think back to the end of the 1990s, early 2000s, and the state was broke. We didn’t have much money. And so here we are, we have this opportunity.”
Water and power concerns are legitimate questions, Gordon said.
“These are things we can work to,” he said. “What I think is really frustrating, and your schizophrenia question is really clear, because we want to teach more CTE, we want our kids to have better jobs and all of this, but we won’t build housing they can move into. So we’re doing a great job of training Colorado, Nebraska, Utah, Idaho and Montana’s workforce … and that’s a problem.”
Done right, data centers are a chance to provide the right kind of opportunities for Wyoming’s youths, to help keep more of them in the state, and build in some diversity, while also helping to bolster legacy industries like oil and gas, as well as build new energy sectors like nuclear, he said.
“Construction will come and go,” Gordon said. “And that’s what it is with the oil field, that’s the way it is with opening a mine, and that’s the way it is with a lot of certain jobs. But the jobs that are going to be here for the long-term are steady, good-paying jobs, and ones that our kids can aspire to.”
Whether Wyoming misses this boom, or finally breaks into a cycle less dependent on the booms and busts of commodity-based industries might depend less on data centers themselves, and more on the guardrails it chooses now for water, power, and tax policy.
It will also depend on how much change it’s willing to accept to keep its children home, and its night skies clear.
Renée Jean can be reached at renee@cowboystatedaily.com.
