The Idaho Falls City Council has approved a 5-year, $40 million memorandum of understanding to provide up to 20 megawatts of electricity per hour to a Utah company.
Block United, LLC is proposing to build a high-capacity data center in Idaho Falls. Idaho Falls Power (IFP) said the company selected Idaho Falls because of its electricity reliability and its history of excess power supply.
By comparison, Idaho Falls Power said the Idaho National Laboratory’s pending super-computer upgrade will require about 2 megawatts. The city’s total current usage is an average 82 megawatts, so the added growth would increase the city’s total power demand by about 25 percent.
IFP estimates it currently has about 14 megawatts of “headroom” in surplus power available and would purchase the difference from the Bonneville Power Administration or from open market sources.
At current rates, Idaho Falls Power would see an estimated $8.1 million in new annual revenue. It would cost the city about $5.3 million to meet the demand. Utility officials said the agreement would not put the city at any great financial risk.
Spokesman Bear Prarie said Idaho Falls Power would require a letter of credit to insure the company’s $700,000 to $800,000 per month power bill would be paid. The company would also be required to meet initial infrastructure expansion costs.
The company has indicated the data center would begin making electrical connections in April or May.
Idaho Falls Power told the city council that residential and business customers would be protected. In the case of a grid failure, for example, the company would be the last customer restored. The city’s proposed contract would be initially limited to 5 years.
IFP will now begin to negotiate firm rates in a power sales agreement with Block United.
IFP says they’re preparing for the excess power.
“We’re looking carefully at, you know, anticipating what kind of impact that load could have on our system,” Jackie Flower, general manager at IFP, said. “And making sure that we have maximum flexibility still in moving power around to serve areas if we have equipment failures or outages or things like that.”