Data Center Site Selection in Kansas

Gov. Laura Kelly signed Senate Bill 98 on April 24, 2025.¹² It creates a sales tax exemption for building, enlarging or remodeling a qualified data center and for buying its equipment, with a minimum investment of $250 million.¹² The Kansas exemption runs for 20 years and covers both state and local sales tax.¹

To qualify, a business must reach $250 million of eligible data center costs in aggregate by its fifth year of operations and create and maintain at least 20 new jobs at the facility within two calendar years after operations begin.¹⁶ The exemption covers property and services bought to construct or remodel the facility, the sale and installation of machinery and data center equipment, and the labor to install, repair and maintain that equipment.⁶ It applies to qualifying purchases made on or after July 1, 2025, and is claimed with a project exemption certificate given to contractors.⁶

There are limits worth reading closely. Telecommunications, wireless and video service providers are excluded, and a qualified business must begin construction within 10 years of state approval.⁶ Projects also go through a cybersecurity and critical-infrastructure risk review by the Kansas Intelligence Fusion Center.⁶ The same bill bars utilities from offering discounted economic development electric rates to new or expanded data centers, so the tax break and the power price are deliberately kept separate.¹²

The $250 million floor means SB 98 is aimed at hyperscale and large colocation campuses, not small enterprise rooms. Compare it with neighboring programs in our sales tax exemptions by state guide, and remember that local property tax abatements are negotiated separately.

Evergy’s Kansas utilities serve many of the state’s largest announced projects, so the KCC’s 2025 decision on Evergy’s large-load power service (LLPS) tariff sets the commercial terms for much of the state’s pipeline.⁸⁹ On November 6, 2025, the commission voted 3–0 to adopt a settlement creating LLPS rates for Evergy’s Kansas utilities, for customers whose peak load is reasonably expected to reach a monthly maximum demand of 75 MW or more.² Existing businesses that add 75 MW of new load also come under the tariff.²

The settlement was filed in August 2025 by Evergy, KCC staff, the Citizens’ Utility Ratepayer Board, the Data Center Coalition, Sierra Club, NRDC and Google, among others.²¹³ The Sierra Club says its intervention helped lower the size threshold from 100 MW to 75 MW and lengthen the minimum term.¹³

• Minimum bill: customers pay at least 80% of their contracted demand, even in months they use less.²
• Collateral: security equal to two years of minimum bills.²
• Term: a minimum of 12 years plus an optional load ramp of up to five years, so up to 17 years in total.⁷
• Cost recovery: the rules let Evergy recover the cost of new lines, transformers, substations and generation built to serve the load.²

KCC Chair Andrew French said the deal protects existing customers while providing “a pathway for economic development.”² For a landowner or developer, the practical effect is a long take-or-pay obligation that should be modeled at full contracted load and matched to a realistic ramp schedule. Our large-load tariffs guide explains how these contracts are underwritten.

The Kansas side of the Kansas City metro holds the state’s largest announced campus. Digital Realty bought about 1,400 acres in Astra Enterprise Park in De Soto, a large business park on the grounds of the former Sunflower Army Ammunition Plant.⁹ It holds an energy service agreement with Evergy for 600 MW by early 2028 that can scale to 2 GW, and the first phase is estimated at about $4 billion before data center equipment.⁹ Former military and industrial tracts like this can offer scale and existing infrastructure, but they need careful environmental and title review.

Evergy’s broader book is growing. In its first-quarter 2026 results, the company said it had signed a new agreement with a developer for a data center in its Kansas Central service territory, bringing its data center service agreements to five with about 2.5 GW of steady-state peak load, and said it was in advanced discussions for another 1.5–3 GW of large loads after 2030.⁸

That load needs new generation. In July 2025 the KCC approved Evergy Kansas Central’s plan to co-own, at 50%, two 710 MW combined-cycle gas plants, Viola in Sumner County and McNew in Reno County, along with the Kansas Sky solar facility in Douglas County.¹⁴ Kansas Central customers were expected to see bills rise about 8.6% to build them, and the commission said it was “troubled by the frequency and magnitude of rate cases.”¹⁴ That tension is why the LLPS tariff exists, and it is a reason to expect regulators to keep scrutinizing who pays. Our guide to data centers and ratepayers covers the debate.

The metro spans the state line, and Missouri has its own tariff and incentive rules. Compare both sides with our Missouri guide before choosing a parcel near the line.

Kansas is a wind state. Wind supplied 52% of in-state net generation in 2024, a lead it has held over coal since 2019, while coal supplied 22%.³ For buyers that want renewable supply, that mix makes clean energy procurement more practical than in coal-heavy states, though the hourly profile still requires firm resources behind it. See our renewable procurement guide for how that affects siting.

Moving that wind to load is the job of the Southwest Power Pool. SPP’s 2025 Integrated Transmission Plan approved about $8.6 billion of new transmission, including 949 miles of new 765 kV line, as the start of a regional 765 kV backbone.⁴ Projects of that scale take years to permit and build, so treat future lines as upside, not as the basis for an energization date.

SPP also has a dedicated path for big loads. On January 14, 2026, FERC accepted SPP’s high impact large load (HILL) rules, which define a HILL as a new load of 10 MW or more at a single site connected at 69 kV or below, or 50 MW or more at higher voltages.⁵ The package includes an optional generation-pairing assessment with a 90-day study target and a conditional service option that lets a load connect on a curtailable basis until firm service is available.⁵ Our SPP guide explains the study process, and the interconnection studies entry covers the vocabulary.

Kansas manages water under a permit system administered by the Kansas Department of Agriculture’s Division of Water Resources (DWR). Its 2026 data center FAQ treats water used for cooling as an industrial use, which requires a permit unless the water comes from a public water supplier such as a city or rural water district.¹⁰ New groundwater permits are available only in areas still open to appropriation, subject to safe-yield limits and well spacing rules that protect existing users.¹⁰

In closed or fully appropriated areas, the route is to buy an existing right, which transfers with the land, and change its use. When an irrigation right is converted, the new quantity is limited to the historical consumptive use of the original right, so that the change does not increase net depletions.¹⁰ That matters because irrigation accounts for about 85% of consumptive water use in Kansas on average.¹⁵

In western Kansas the question is sharper. Backers of a proposed AI data center in Finney County argue it could use less water than the irrigated farming it replaces, while the Ogallala Aquifer beneath it has been in steep decline.¹⁶ Closed-loop or air-cooled designs reduce the problem but shift load onto the power side. See our guide to water rights and groundwater for the general framework.

Kansas zoning is largely a city and county matter, and in 2026 several counties paused data center development while they wrote rules. The Saline County Commission voted 4–0 for a three-year moratorium on data centers, nuclear power and hydrogen-based energy facilities in unincorporated areas, joining Sedgwick and Harvey counties, which had also adopted data center moratoriums.¹¹

Leavenworth County shows how quickly the picture can change. After debate over a proposed hyperscale campus near Tonganoxie, the county commission lifted its data center moratorium on a 3–2 vote in August 2026.¹⁷ A pause can end, be extended or turn into a permanent ordinance with setbacks, noise limits and other conditions, and new commissioners can change the vote count.

For a seller, the safest assumption is that any unincorporated parcel may need a rezoning or special use permit, with public hearings. Build that time into the option term, and read our guides to moratoriums and local restrictions and community engagement. Central and western Kansas sites should also be screened for tornado and high-wind exposure.

1. 01Confirm the serving utility (Evergy, a cooperative or a municipal system) and whether the LLPS tariff applies at your planned load.
2. 02Model the 80% minimum bill, collateral and contract term at full contracted demand.
3. 03Ask the utility where new generation and transmission sit relative to your ramp, and whether an SPP large-load study is needed.
4. 04Check the county’s current status: moratorium, pending ordinance or existing data center zoning.
5. 05Identify the water source and whether the area is open to new appropriation.
6. 06Map the SB 98 investment and job deadlines against your construction and hiring schedule.

Kansas’s advantages are real: abundant wind, open land and a clear tax exemption. The constraints are mostly about timing and terms, from generation build-out to county hearings to water rights. Ask the utility and county for written answers before paying for a long option. Our due diligence checklist and will-serve letter guide expand on these steps. If you have Kansas land and want an independent read, get a site reviewed.