Applied Digital Signs $2.4B Deal for Boiler-Powered AI Data Centers

Applied Digital has committed $2.4 billion to build 1.2 gigawatts of gas-fired boiler and steam-turbine capacity for three North Dakota data-center facilities. The deal offers a route around gas-turbine backlogs, but it is not immediate power: the first site is scheduled to begin operating in late 2028.

The company signed the design-and-build agreement with independent power producer Base Electron. One North Dakota data center is under construction and two more are being finalized. All three are intended to use industrial boilers fueled by natural gas to make steam, which then drives steam turbines to generate electricity.

$2.4 billionDesign-and-build agreement

Applied Digital signed the agreement with Base Electron for the boiler-and-steam-turbine projects.

1.2 GWPlanned generating capacity

The capacity is intended for one data center under construction and two additional North Dakota facilities being finalized.

Late 2028First planned operation

The first facility using the configuration is scheduled to begin operating in late 2028.

A bridge to a more efficient plant

Applied Digital does not present the boiler-and-steam-turbine arrangement as its final configuration. It intends to convert the facilities into combined-cycle plants when gas turbines become available. In that setup, the boilers would remain in use, supplementing steam produced from a gas turbine’s exhaust heat.

Why the project uses boilers first

• Applied Digital CEO Wes Cummins said gas turbines ordered now might not arrive until 2032.
• Cummins said packaged boilers can typically be delivered in a year or less, while boiler maker Rentech said it can manufacture and deliver one within a year of an order.
• Packaged boilers are factory-assembled with equipment such as burners and controls, reducing on-site work to basic connections and installation.

The supply constraint has moved upstream

The appeal is less about a newly invented generation method than about equipment availability. GE Vernova has reported more than 100 GW of gas-turbine orders and slot reservations, while Siemens Energy, Solar Turbines and Mitsubishi Power have also reported supply delays. That leaves developers looking for power equipment with established manufacturing capacity and shorter lead times.

The strategy still carries a timing and efficiency tradeoff. The initial boiler-and-steam-turbine plants depend on burning natural gas, while the planned combined-cycle conversion remains contingent on future turbine availability. Applied Digital’s agreement shows how the turbine backlog is already shaping not just construction schedules, but the first-generation design of AI power systems.