• CoreWeave and Decennial Group investing USD 3bn in data center expansion in Hammond, Indiana
• If NIPSCO cannot handle power demand, the project cannot move forward

CoreWeave’s180 MW, USD 3bn AI data center expansion in Hammond, Indiana is awaiting a long-term power supply contract with utility provider Northern Indiana Public Service Company (NIPSCO).

The project is touted by the city as “the largest economic development project in Hammond’s history.”

Despite city approval, the project’s fate remains with the utility provider’s support.

Hammond City Council approved June 9 a development agreement for a 180 MW data center project, expanding CoreWeave’s presence in the city at the site of the former State Line Energy plant, a legacy coal-burning electrical power plant site.

The project is proposed by Chicago-headquartered developer Decennial Group, which, together with CoreWeave, is investing roughly USD 3bn. It features the construction of a 450,000 square foot facility on a 25-acre parcel located at 301 Digital Crossroads Drive. The new building will be adjacent to the 105,000 square foot data center Decennial delivered in 2020, which includes a 20 MW utility feed via an on-site substation and 25 MW of backup generation. CoreWeave, which occupies the existing facility, is slated to remain a tenant in both the current and planned buildings.

Decennial will finance and own the shell while CoreWeave leases the space for at least 20 years, according to a city press release.

Council also approved a 10-year real property tax abatement for the site.

The 180 MW will be one of the company’s largest expansions, Michael Terlizzi, CoreWeave data center operations senior vice president, said.

While the city approvals communicate support of the project, NIPSCO will be the ultimate decider of the project’s future.

“Should NIPSCO fail to come through with the power we need for this project, this agreement that we’re approving tonight dies – all of it. … I think NIPSCO wants this to happen too, but that it’s the last step is NIPSCO. They could say yes or they could say no,” Hammond Mayor Thomas McDermott, Jr. said during the City Council meeting.

Council members expressed concern about NIPSCO approval and the capacity to handle the sizable power demand.

“It’s forecasted that just a handful of hyperscaler data centers coming to Northern Indiana will use more electricity by 2030 than all Indiana residential customers, more than all Indiana commercial customers and almost as much as all Indiana industrial customers use today,” Councilman Alfonso Salinas said. “So this isn’t just about these guys. This is about the 14 data centers that are projected right now under the NIPSCO umbrella. So, the concern is, how are they going to do that?”

If there’s not adequate power, McDermott said NIPSCO’s decision will be a no. However, in discussions with NIPSCO, there was talk of the company utilizing natural gas peakers.

Additionally, CoreWeave and Decennial have already paid USD 30m to NIPSCO so the company could continue to secure generation and renewable energy contracts.

“Data centers operate 99.9999% of time, so we are a very stable user of power from the grid,” David Pavlik, Decennial Group co-founder and managing partner, said. “That allows NIPSCO to work with its kind of parent organization, to plan out the construction of new generation, whether that’s natural gas or wind power or solar plants or nuclear, far beyond just the NIPSCO region.”

NIPSCO has between now and 2027 to finalize power procurement, as the project won’t be using power until then, he added.

The anticipated timeline for the project could begin as soon as NIPSCO and the developer come to a long-term power-supply agreement. If executed this summer, site work could start before year end.

The developers did not respond to requests for comment.