Applied Digital Breaks Ground on $3.6B Delta Forge 1 in Louisiana

Applied Digital Corporation (Nasdaq: APLD), the Dallas-based digital infrastructure firm, formally announced plans Tuesday to develop Delta Forge 1, a large-scale AI factory campus in Boyce designed to support artificial intelligence training, inference, and cloud computing workloads. The company plans to develop the $3.6 billion, 300-acre campus in the town of Boyce in Rapides Parish. The initial phase will include two facilities across approximately 300 acres with a combined 300 megawatts of critical IT capacity. The project promises 200 permanent jobs at an average of $90,000 a year to a region that has watched economic investment concentrate elsewhere for most of the past half-century.

For Rapides Parish, the announcement is the largest industrial commitment in living memory. For the approximately 300,000 customers on Cleco’s grid, it arrives alongside a harder question: how a single facility’s power appetite lands on a state that already ranks third nationally in per-capita electricity consumption, and whether the utility’s promise of flat or falling residential rates holds when the math gets stress-tested.

The Numbers Behind the Announcement

Governor Jeff Landry, speaking at England Airpark’s Community Center in Alexandria, said Louisiana Economic Development estimates the project will result in an additional 218 indirect new jobs, for a total of 418 potential new job opportunities in the Central Region. His framing was direct: Central and North Louisiana communities that have lived through “missed economic opportunities” were finally getting their delivery.

• $3.6 billion total campus investment, Applied Digital’s first Louisiana location
• 300 MW of critical IT load across two buildings on approximately 300 acres
• 200 direct jobs averaging $90,000 a year, set at 150% of Louisiana’s average wage
• 1,000-plus construction jobs expected at peak development
• $32.67 million combined annual payroll for the 200 permanent on-site positions

Applied Digital purchased a 672-acre lot near Boyce, west of Alexandria, in December. The initial campus footprint consumes roughly 300 of those acres. Site development on the data center campus began in January 2026, with initial operations expected to begin in mid-2027, placing construction momentum roughly five months ahead of Tuesday’s formal ceremony.

The lease structure signals a long-horizon commitment. The campus operates under a 15-year initial lease with three five-year renewal options, building toward the 27-year payment schedule that governs the company’s tax commitments to parish institutions. Applied Digital has pledged to cover all costs for the campus’s power consumption and the physical infrastructure required to connect the site to Cleco’s transmission lines.

Qualifying for Act 730’s state data center equipment tax exemption, established in Louisiana’s 2024 legislative session, Applied Digital gained a carve-out from state and local sales and use taxes on servers, routers, and other qualifying equipment. Applied Digital qualified for Louisiana’s state and local sales and use tax exemption on qualifying purchases or leases of data center equipment, established in Act 730 of the 2024 Regular Legislative Session. The exemption has anchored Louisiana’s pitch for every large-scale AI infrastructure commitment the state has announced in the past two years.

Central Louisiana’s Half-Century Gap

Chris Masingill, president and CEO of Louisiana Central, said the project “has the potential to be one of the most transformational in the history of Rapides Parish, surpassing even the major industrial investments of the 1950s and 60s.” That comparison points to the postwar petrochemical expansion that built out Louisiana’s I-10 belt while the parishes north of Baton Rouge largely watched from a distance.

Two hundred permanent positions at 150% of the state’s average wage represent a structural shift for a labor market where comparable industrial salaries have been scarce for decades. Applied Digital board director Richard Nottenburg said the arrival of the data center will come with over $500 million in “direct benefit” to Rapides Parish. Those benefits run through wages, tax payments, vendor and contractor spending, and utility revenue across the life of the deal.

Ralph Hennessey, executive director of the England Economic and Industrial Development District (EEIDD), said the project is “a defining moment for Central Louisiana and the EEIDD as a driver of innovation and opportunity.” England Airpark’s industrial zone, where Tuesday’s announcement was staged, has been positioned as a development-ready asset for years, with available land, airfield infrastructure, and I-49 access giving it a pitch for facilities that need reliable energy delivery and room to scale.

The Grid Arithmetic Cleco Has to Solve

Sizing Up the Campus Power Footprint

Cleco will provide electrical service for the campus. Cleco President and CEO Bill Fontenot described the project as the largest economic development opportunity in the utility company’s more than 90-year history. The 300-megawatt demand at the Boyce site is roughly equivalent to the entire output of Oxbow Solar, Louisiana’s largest solar farm, which spans 1,800 acres and powers approximately 62,400 households on an average day. A single industrial customer, in other words, will draw as much power as one of the state’s biggest generation assets.

Cleco will supply the electricity, though officials and the utility have not yet mentioned any plans for a new power plant. Details on the transmission infrastructure required to connect the campus to the existing grid have not been released. The Louisiana Public Service Commission (LPSC), which regulates Cleco’s rate structure and reviews major capital expenditure plans, will have visibility into those arrangements as the project moves from site preparation to live operations.

The Rate Promise

Fontenot was direct when asked whether existing Cleco customers should expect higher bills. “The answer is no,” he said at the Tuesday announcement. His reasoning rested on volume economics: more industrial customers spread fixed infrastructure costs across a larger base, holding or lowering per-unit rates.

You bring in more sales, you bring in more volume. That means you’ve got a broader customer base to spread your costs.

That logic operates under assumptions that do not always hold in regulated utility markets. Louisiana already ranks third in the United States for per-capita electricity consumption, a figure driven by the state’s warm climate, its legacy petrochemical and refining complex, and a level of industrial load that keeps infrastructure costs persistently high. Cleco’s base rates are reviewed and approved by the Louisiana Public Service Commission, the state regulatory agency for utilities in the state. Whether adding one facility’s 300-megawatt draw produces the moderating rate effect Fontenot described is a question that LPSC rate proceedings, not press conference arithmetic, will eventually settle.

Nottenburg offered a data point from Applied Digital’s existing track record. Applied Digital’s fiscal third-quarter 2026 results show the company’s North Dakota hosting campuses generating nearly $14 million in segment operating profit on roughly $120 million in deployed assets, a margin profile consistent with stable long-term economics. Nottenburg said residential rates near those facilities came down after operations began. Louisiana’s LPSC, not corporate precedent from the Dakotas, will be the final arbiter of whether that pattern replicates in Rapides Parish.

Louisiana’s Widening Data Center Corridor

Delta Forge 1 arrives in the middle of a broader state-level shift. Louisiana has drawn commitments from several of the world’s largest technology companies over the past 18 months, with state tax policy, available land, and grid capacity doing most of the competitive work.

The wave includes Meta’s $30 billion Hyperion data center in Richland Parish, Hut 8’s $10 billion AI campus in West Feliciana Parish, and Amazon’s $12 billion campuses planned for Caddo and Bossier parishes. The combined announced investment across these four projects exceeds $55 billion, though large infrastructure figures typically reflect phased buildouts over many years rather than near-term expenditures in any single budget cycle.

Governor Landry connected the data center surge to a grid resiliency argument, contending that industrial-scale customers inject revenue into the utility system that finances infrastructure improvements protecting all ratepayers. MISO manages the flow of electricity across 15 states, including Louisiana, and its job is to balance supply and demand in real time, help manage congestion on transmission lines, and prevent large-scale outages. The Midcontinent Independent System Operator received proposals for five gas-fired power plants totaling 6,170 MW in Louisiana for a fast-track interconnection review in August 2025, a sign of how much new generation the state expects to need as demand from data centers and industrial expansion compounds.

Aggregate megawatt demand across the four announced campuses has not been publicly totaled by state regulators. Meta’s Hyperion campus in Richland Parish is expected to require considerably more than Applied Digital’s 300-megawatt footprint based on its announced capital scale alone. Each new facility adds to the interconnection queue and the transmission upgrade obligations that MISO and Cleco will need to absorb before any of them can operate at full capacity.

What Rapides Parish Gets in Writing

Applied Digital’s payment commitments run through the 27-year agreement and are structured across the parish’s core public institutions, from government operations to schools to law enforcement.

At $206.2 million over the agreement’s life, the school system payment would represent a generational funding event for a district that has operated on constrained state allocation formulas. Applied Digital and LED have not publicly identified the ten local taxing bodies that collectively receive the largest pool at $575.5 million. Across all listed recipients, cumulative payments approach $947 million over 27 years, a figure broadly consistent with Nottenburg’s claim that direct benefits to the parish exceed $500 million.

From Ground to Grid

Site preparation at the Boyce location started in January 2026, and Applied Digital expects initial operations by mid-2027, roughly 18 months from site work to a live AI compute environment. The campus will make use of a closed-loop cooling system, which recirculates the same coolant in a continuous loop, eliminating the need for constant water replenishment. Applied Digital has said one of its existing facilities uses water at roughly the rate of a single-family home, crediting the same recirculating technology planned for Central Louisiana.

Louisiana gives Applied Digital a third major geography alongside its North Dakota platform. As of August 2025, the company’s 106 MW facility in Jamestown, N.D., and 180 MW facility in Ellendale, N.D., are operating at full capacity. The company completed a $2.15 billion private offering of 6.750% Senior Secured Notes due 2031, with proceeds funding the development and construction of 200 MW of critical IT load at the Polaris Forge 2 AI Factory campus in Harwood, North Dakota. Revenues hit $126.6 million in fiscal Q2 2026, up 250% from the prior year comparable period, while the company continues to post net losses as construction investment runs ahead of operating cash generation.

If the mid-2027 opening holds and Cleco’s rate arrangement clears LPSC review, the Rapides Parish School System begins collecting its $7.6 million annual installment the following year. That date, not the ceremony at England Airpark, is when the communities Governor Landry described Tuesday start seeing the numbers written into the agreement.