Gov. Mark Gordon’s “all-of-the-above, carbon negative” energy strategy seeks to diversify Wyoming’s robust energy economy and insulate Wyomingites against historic boom-and-bust cycles. As an energy-producing state, there will always be an opportunity for Wyoming to combine economic diversification with the expansion of next-generation energy sources. The artificial intelligence boom offers a new opportunity to advance this mission, by expanding Wyoming’s fleet of hyperscale data centers — the infrastructure backbone to AI.  Opinion Wyoming hasn’t historically been a data center hotspot. Data centers traditionally have had a low latency requirement — meaning they have to be close to the users of the data — so developers have stuck to building in highly populated areas along the coasts. But, big data centers used for building AI models don’t need to be near users. What they do need is ample amounts of power — the data demand for AI models is predicted to necessitate a 160% increase in data center power demand by 2030 — and traditional data center hubs are running out of power. As a result, developers are turning to Wyoming, a leading energy state that exports 60% of the electricity it generates and is actively onboarding new power assets to the grid. Already, Meta and Microsoft are both working in Cheyenne, and Prometheus Hyperscale, an independent developer, is building in Evanston.  Enticed by this abundant power, as well as Wyoming’s infrequent natural disasters, proximity to fiber optic cables, cool temperatures, favorable tax environment and a large hard-skilled workforce, more data center companies are knocking on our state’s door. Business, state and community leaders should welcome this opportunity and work carefully to maximize the benefits for Wyomingites. If managed correctly, the data center industry could further diversify the state economy, strengthen Wyoming’s profile as a leader in developing next-generation energy sources, and make Wyoming more resilient to historic boom-and-bust cycles.  Data center development will support the state economy in four ways. First, developers will have to pay property and sales taxes on electricity, providing revenue to municipalities, counties and the state. These projects can be transformative for a municipality’s revenue stream.  Second, data centers will create new in-state demand for electricity producers. When wind, solar, nuclear and geothermal companies come to Wyoming for its natural resources, they will no longer have to leap the additional hurdles of finding out-of-state power customers and building long-distance transmission lines to them. With more data centers, which can use as much electricity as a city, next-generation energy producers in Wyoming will have an easier time developing new projects.  Third, data center development will create new and varied job opportunities. Each center will employ thousands of temporary construction workers and hundreds of full-time engineers and technicians.  Fourth, many data center developers are working with nuclear power companies, due to their need for uninterrupted around-the-clock power and desire for lower carbon emissions. Growth in data centers will lead to growth in the nuclear industry, and growth in nuclear will spur the renaissance of uranium mining. Wyoming has the largest uranium reserves in the country and can become one of the critical suppliers of uranium as the nuclear energy sector grows.  To guarantee these benefits for Wyomingites, the state needs to prioritize the following best practices. First, policymakers in Cheyenne should maintain the current sales and use tax exemption for data center developers. Thirty-two other states have a similar policy, so Wyoming needs to keep this law to stay in the race for new development. The state should continue to provide Business Ready Community grants that municipalities can distribute to developers to reduce the cost of necessary infrastructure for data centers. Lawmakers in Cheyenne should consider additional incentives for data center developers who build behind-the-meter power solutions. By pushing developers to colocate microgrid power solutions with their data centers, the state can reduce the strain on the electrical grid (a major concern of building data centers) and avoid pouring money into new grid infrastructure. Companies are already turning towards behind-the-meter solutions to derisk investment, as grid-building constraints add immense uncertainty to project timelines. Additional incentives for such infrastructure would elevate Wyoming’s profile as a good home for data centers, diminish the risk of jacking up electricity rates for Wyomingites, and push hyperscalers to source next-generation power solutions.  Second, public and private sector stakeholders should invest in workforce development programs. Wyoming is rich in hard-skilled laborers, so with precise investment in retraining and advanced training programs, the state can prepare its workforce for data center development. These programs should focus on advanced training for electricians and data center technicians. This will both encourage developers to come to Wyoming and ensure that the newly created jobs go to local people. Wyoming community colleges have a proven track record of stepping up to the plate and supporting training efforts for the evolving energy economy. Programs for data center development can mirror the new Western Wyoming Community College Nuclear Technology Program that prepares its students for employment at Terra Power in Kemmerer.  Third, Wyoming should encourage hyperscalers to source and build next-generation power solutions, such as wind, geothermal and carbon capture. Supporting corporate commitments to low-emissions energy will both help reduce the environmental burden of AI and catalyze more rapid growth in the alternative energy sector in Wyoming. Absent a complementary emphasis on next-generation energy development, AI and data centers will do more harm than good from a climate perspective and do less to diversify Wyoming’s energy assets.  Fourth, municipalities across Wyoming should continue to establish economic development commissions to help facilitate the introduction of new companies to their area and ensure developers act as true community partners. Cheyenne LEADS has developed a playbook for effectively navigating data center growth, and other development-ready towns and cities should look to follow this model.  If managed correctly, data center development in Wyoming could further the state’s economic diversification mission, provide insulation to local people against the historic boom-and-bust cycle, and advance the next-generation energy sector. The post Wyoming should encourage data-center development as economic tool appeared first on WyoFile .