Oregon Data Center Market Guide 2026

Oregon has quietly become one of the most important data center markets in the United States. Blessed with abundant hydroelectric power, a cool climate that enables free cooling for much of the year, and progressive tax incentives, Oregon hosts massive facilities from Google, Facebook (Meta), Apple, and Amazon alongside colocation providers like QTS, Digital Realty, and STACK Infrastructure. For AI workloads that require massive power at low cost, Oregon is increasingly compelling.

Why Oregon for Data Centers?

• Cheap hydroelectric power: Oregon's power rates are among the lowest in the nation, averaging $0.04-0.06/kWh for large industrial consumers. The Bonneville Power Administration (BPA) provides hydroelectric power from the Columbia River system, delivering clean, reliable, and affordable electricity. For AI training clusters that run 24/7, this power cost advantage is enormous.
• Cool climate: Oregon's Pacific Northwest climate provides natural free cooling for 8-10 months per year. Average temperatures in the Hillsboro/Portland area range from 40-75°F, and even The Dalles (eastern Oregon) enjoys cool nights. This dramatically reduces cooling costs and enables PUE values of 1.1-1.2 with minimal mechanical cooling.
• Tax incentives: Oregon's Enterprise Zone program provides 3-5 year property tax exemptions for qualifying data centers. The state also has no sales tax, eliminating a significant cost for equipment purchases. Combined, these incentives can save millions over the life of a facility.
• Renewable energy profile: Oregon generates over 60% of its electricity from renewable sources, primarily hydroelectric. Data centers in Oregon can legitimately claim clean energy operations without purchasing separate renewable energy credits, which is increasingly important for ESG reporting.
• West Coast connectivity: Oregon sits on major fiber routes connecting Seattle, San Francisco, and international submarine cables. The Pacific Northwest is a key interconnection point for trans-Pacific traffic to Asia.

Key Oregon Data Center Markets

Hillsboro / Portland Metro

Hillsboro, located about 20 miles west of Portland, is Oregon's primary data center market and one of the top 10 data center markets in the US. The Hillsboro area hosts facilities from QTS, STACK Infrastructure, Digital Realty, Flexential, and others, with over 200 MW of total capacity and significant expansion underway.

Key advantages of Hillsboro include excellent fiber connectivity (it sits at the intersection of major north-south and east-west fiber routes), access to Portland General Electric's reliable grid, and proximity to Intel's massive campus (which has created a deep technical talent pool). The area also benefits from Portland's airport for fly-in maintenance and management visits.

The Dalles

The Dalles, located about 80 miles east of Portland along the Columbia River, is famous as the home of Google's first major data center campus. Google chose The Dalles for its direct access to BPA hydroelectric power from The Dalles Dam, which provides some of the cheapest and cleanest electricity available anywhere. The Dalles offers lower real estate costs than Hillsboro but less carrier diversity and connectivity options.

Prineville

Prineville in central Oregon hosts Facebook (Meta) and Apple data center campuses. Like The Dalles, Prineville attracts hyperscalers seeking cheap power and large land parcels rather than dense connectivity. The city has actively courted data center investment through enterprise zone incentives and expedited permitting.

Boardman

Boardman in eastern Oregon has attracted Amazon Web Services and other cloud providers. The area offers abundant land, low power costs from BPA hydro, and recently decommissioned coal plant infrastructure that can be repurposed for data center power delivery.

Top Data Center Facilities in Oregon

AI Infrastructure in Oregon

Oregon's combination of cheap, clean power and cool climate makes it particularly attractive for AI training workloads. Key considerations:

• Power cost advantage: At $0.04-0.06/kWh, Oregon is 30-50% cheaper than most other major markets. For a 10 MW AI training cluster running 24/7, this translates to $1.5-3M in annual power savings compared to Northern Virginia or New Jersey.
• Cooling efficiency: The cool climate means liquid cooling systems can use free cooling for most of the year, further reducing operating costs. A facility in Hillsboro might achieve PUE of 1.08 compared to 1.3 in Phoenix.
• Latency considerations: Oregon is 60-80ms from the East Coast and 15-25ms from the Bay Area. For AI training (which doesn't require low latency to users), this is a non-issue. For inference serving West Coast users, it's excellent.
• Growing GPU availability: Several Oregon facilities now offer GPU colocation, though the market is less developed than Virginia or Texas for AI-specific infrastructure.

Power and Sustainability

Oregon's power story is compelling but nuanced:

• Hydro dominance: BPA hydroelectric provides the backbone of Oregon's power supply, offering clean, cheap, and reliable baseload electricity. However, hydro generation varies with snowpack and river flows, creating seasonal variability.
• Wind growth: Eastern Oregon's wind resources are significant, and wind generation helps balance seasonal hydro variability. Oregon's Renewable Portfolio Standard targets 50% renewable by 2040.
• Grid capacity: Like other growing markets, Oregon faces grid capacity challenges. Hillsboro in particular has seen utility connection timelines extend as data center demand outpaces grid expansion.
• Carbon-free claims: Oregon data centers can credibly claim very high renewable energy percentages given the hydro-dominated grid, making the state attractive for organizations with strong sustainability commitments.

Cost Comparison

• Oregon vs Northern Virginia: Oregon offers 40-60% lower power costs and better cooling economics. Virginia offers vastly superior connectivity and the largest ecosystem. For pure AI training, Oregon wins on cost.
• Oregon vs Washington: Similar climate and power benefits, but Oregon's tax incentives (no sales tax + enterprise zones) often give it an edge. Washington's larger market (Seattle) offers more carrier diversity.
• Oregon vs Texas: Similar power costs in some Texas markets, but Oregon's climate provides natural cooling advantages. Texas offers more overall capacity and a larger colocation ecosystem.

Challenges

• Limited connectivity in rural areas: The Dalles, Prineville, and Boardman offer great power but limited carrier options. Hillsboro is the only Oregon market with true carrier diversity.
• Grid expansion timelines: Portland General Electric and Pacific Power face growing demand that may extend connection timelines.
• Seismic risk: Oregon lies on the Cascadia Subduction Zone. While major earthquakes are rare, facilities should be designed to seismic standards.
• Water availability: Some cooling approaches require water, and Oregon's water rights system can complicate access, particularly in eastern Oregon.

Future Outlook

Oregon's data center market is poised for continued growth, particularly for AI and hyperscale workloads. Expect to see:

• Continued hyperscaler expansion in The Dalles, Prineville, and Boardman
• Growing colocation capacity in Hillsboro for AI and enterprise workloads
• Increased focus on liquid cooling to maximize Oregon's climate advantages
• New utility investments to expand grid capacity for data center demand
• Potential for small modular reactors (SMRs) to supplement hydro and wind generation

For the latest data on all Oregon facilities, visit our Oregon state page or browse the full directory.