Brightlio Blog

As technology needs expand, many companies are pursuing new data center markets to support their IT needs. Many customers are attracted to the Las Vegas data centers due to their competitive cost, central location, and excellent network connectivity.

Las Vegas, Nevada, offers many advantages that make the city attractive to colocation providers and their customers. This article will explore the top five reasons Las Vegas is an ideal market for your colocation needs.

Las Vegas Has a Booming Data Center Industry

Companies needing colocation services often turn to Las Vegas as an alternative data center market. The city has 24 colocation facilities serving many businesses.

Switch Data Center in Las Vegas is the largest colocation provider in the city. The company operates five data centers with over 130 Megawatts (MW) of multi-tenant commissioned power available for use. In addition to the five data centers, the company has two more facilities under construction. These facilities will contribute an additional 45MW of power to the city’s colocation industry. 

Other popular data centers in the region include:

• Google Data Center, Henderson
• Flexential Data Center, North Las Vegas
• Cyxtera Data Center, Las Vegas
• Novva Data Centers, Las Vegas
• EdgeConnecx Data Center, Las Vegas

Because the city has many data centers, companies can easily find a colocation partner that matches their needs and budget. 

Colocation Facilities in Las Vegas Have Access to Reliable Power

The average cost of electricity in Las Vegas is 15 ¢/kWh. This electricity rate is 35% lower than the country’s national average and only 1% higher than the average electricity rate in Nevada. The city receives power from the largest utility company in the state, Nevada Energy. 

Nevada Energy supplies consistent power to data centers because its portfolio has a mix of renewable energy sources. For example, the utility company generates most of its energy from geothermal sources, hydroelectricity, and solar power. 

Las Vegas is the first large city in the US to use 100% renewable energy. This makes it possible for data centers in the city to meet their sustainability goals at an affordable rate. Furthermore, the state of Nevada has consistently advocated for integrating alternative energy into the region’s electrical infrastructure. 

Nevada is among the top states with utility-scale electricity generated from geothermal energy and ranks second for geothermal power production, just after California.

The state’s government enacted a Renewable Portfolio Standard (RPS) that requires electric utility companies to acquire at least 50% of the electricity they sell from renewable sources by 2030. All these public electricity systems allow the data centers in Las Vegas to build a sustainable business model without suffering from power-related issues. 

The City Enjoys a Strategic Economic Location

Las Vegas resides close to California and other regional data center markets like Phoenix, Salt Lake City, Denver, Silicon Valley, Los Angeles, Irvine, and San Diego. This strategic positioning makes it a prime location for data centers looking to serve customers in these regions.

Furthermore, the city is less exposed to natural disasters like earthquakes, tornadoes, and hurricanes. Although the region experiences some flash flooding, the Threat and Hazard Identification and Risk Assessment (THIRA) process help businesses in the community identify the resources they need to address unanticipated risks.

Ultimately, the city’s geographical position makes it a desirable location for businesses that want to serve a global audience.

Data Centers in Las Vegas Enjoy a Favorable Economic Climate

Nevada offers many incentives to assist data centers that operate in the region. Here, we’ll discuss the top three incentives data centers within the state are entitled to:

• Standard tax abatement: The state offers a variety of sales and use tax breaks to colocation facilities that qualify. For example, data centers are entitled to a 2% reduction rate on qualified equipment purchases made for the facility. They are also entitled to a reduction of 50% on the 1.38% tax the state charges on wages that exceed $50,000. 
• Property abatement: Data centers in Las Vegas are also entitled to up to 10 years of tax breaks on qualifying real estate properties that the facilities own. 
• Wage breaks: Colocation facilities in Las Vegas can access other wage breaks when they provide a minimum number of new jobs. Additionally, if the company offers medical insurance plan and pays at least 65% of the cost, they’re entitled to further federal reductions.

These tax breaks make it easy for data centers to build and expand their services within the city. 

Data Centers in Las Vegas Have Access to a Capable Workforce

With a population of 659,348, Las Vegas is the largest city in Nevada and the 26th largest city in the United States. The region is home to famous institutions like the University of Nevada, Las Vegas, Nevada State College, and College of Southern Nevada. Because these institutions produce a steady stream of talented graduates, data centers have access to the workforce they need to keep the industry running. 

Another reason many tech workers migrate to Nevada is that the region has no state income tax. The city earns the money it needs from tourism, casino resort fees, and its high sales tax rate of 8.25%. Because of these factors, data centers in Las Vegas no longer worry about the quality and quantity of talents they need to hire.

How Brightlio Can Help With Las Vegas Colocation Pricing

Brightlio connects customers with suitable data center providers in Las Vegas and other markets. We work closely with a network of global data center partners to provide customized colocation solutions that match your specific needs and budget.

As a telecom broker, we also offer numerous other IT services that cater to your company’s technology needs. Our services include unified communications, cloud solutions, network connectivity, and SD-WAN services.

Contact the team today to get started!