634: Applied Digital CEO talks about Harwood, AI, jobs, and nondisclosure agreements (Audio)

"It's by far the most important race we've been in in the world."

That's what Applied Digital CEO Wes Cummins told us on this episode of Plain Talk. "In my opinion, there's two countries that are racing forward to advance AI, to reach super intelligence, to reach AGI [artificial general intelligence], and it's the United States and it's China."

Cummins says he wants the United States to win that race, which is why they're investing heavily in data center infrastructure across the country, including billions of dollars' worth of projects in North Dakota. But that push is not without some local headwinds. Opposition to one of their proposed data centers in Harwood, North Dakota, has manifested itself in some shouty public meetings, if not necessarily pushback from the larger public.

One bone of contention has been nondisclosure agreements that his company had some local officials, including elected leaders, sign ahead of the Harwood project. Many (including this humble correspondent) have been critical of that move, but Cummins said it's a reality given the nature of their business as a publicly-traded company.

"What I will say is there is no purpose to keep information away from the public that they need to have to be informed to know what's going on," he said. "These are typically things that we do prior to us launching a project or doing a project."

There are two purposes of an NDA in this context. One is to protect the company's competitive information, since local officials get to tour facilities and learn details about building plans, but the other is to ensure that no illegal trading schemes emerge from the information shared. "So say we have the mayor and he's not steeped in public company rules and regulations, and he tells a couple of his friends or people that work around it or people that he's close with that this big new project could be coming," Cummins said, describing one possible scenarios. "And then they go and find our company, and they say, 'You know what? This is interesting. Maybe I'll buy their stock.' And then you have this issue of potentially violations in insider trading laws."

Cummins defended the NDAs by saying they're part of promoting a clean project.

"A lot of people who want to yell about, you know, that they're bought and paid for or were trying to hide something would be even happier if one of these guys got in trouble for a simple misstep on something that they didn't know about."

And what about the claims that these power-hungry data centers will drive up power prices for North Dakotans? Cummins said that it won't be a problem, because North Dakota already produces far more power than it uses. "When you're a net power exporter and you start using power inside of your state, you just export less power, and so the power is already abundant."

He said that at the company's facility in Ellendale, they're actually saving rate payers money, because their facility is allowing utilities to use capacity they were paying for but not utilizing. "With us adding 200 megawatts of load in Ellendale for the last 2 years, we have saved the MDU ratepayers 3.5 million in 2023 that was dispersed back to the ratepayers, and 5.7 million, I believe, in 2024. So we have two years of record of utilizing the infrastructure that's there. The utility makes more money and then shares that money back with its customers."

Cummins said he wasn't sure if that would be the case with the Harwood facility, but he's not concerned about his company's power consumption driving up rates.

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