Culper

Masterplan

4. Cost

AACE Class 4 (−30% / +50%). Capex excludes GPUs. Sensitivity is in §4.4.

4.1Capital estimate, class, and the range we may claim

Standard AACE 18R-97. Class 4 is entitled to -30% / +50%. We do not claim tighter.

Rental-gen (halls, no owned turbines) P50: 5,360.5 $MEstimate, range $3,752M to $8,041M. Owned-campus P50: 6,738.1 $MEstimate. Per MW IT: $15.3M rental / $19.3M owned. Owned-campus P50 is the compiled total (halls, MEP, site, and generation). Atlas site-infrastructure bands are a separate line.

Atlas site program vs compiled campusAtlas quotes the site program: laterals, BESS, civil, camp, water, fiber, and (in P2) ownership conversion. Generation in P1 is rented. Halls sit in a separate Atlas band. This chapter compiles halls, MEP, site, and generation on 350 MW IT, excluding GPUs, Class 4. The P1 $160–280M band is site infrastructure, not all-in campus.
Atlas programLoadQuoted capex
Phase 0: Diligence
Months 0–9
No load yet. Licensed microwave link live by ~month 3 for site connectivity.$2–5M: study program $1.6–3.7M plus route diligence and microwave.
Phase 1: First power
Months 6–24. Target first fire ~month 12–15.
150–200 MW of generation (~100–133 MW of computing load), with an 85 MW battery system.$160–280M site infrastructure (gas lateral $45–70M, batteries $38–59M, civil and camp $65–115M, water $9–17M, fiber $12–19M). Generation is rented, not bought (see below).
Phase 2: Scale
Months 24–48
Toward 500 MW: rented turbines convert to owned equipment, engine halls add efficient baseload.$400–600M this phase (generation ownership conversion, engine halls, gas expansion, second pad).
Phase 3: Grid connection
2030 and later, when the state reopens the queue
The 345 kV cut-in of the 350 MW campus. On-site fleet becomes backup and peak sales.$45–80M for the switchyard and line connection, plus state-required deposits (~$100k per MW under the proposed rule).
Phase 4: Toward 3 GW
After the 345 kV cut-in, later tranches
Toward 3,000 MW IT on the Cottonwood corridor. Grid-hybrid. Not Palo Duro fuel.Not compiled. Optionality on later tranches of the same ranch.

Atlas halls are quoted at $9–12M per gross MW in the plan popups, which is the same neighborhood as the compiled Class 4 vertical of $10.23M per MW IT. Owned aero is Atlas $1,400–1,900/kW; this study uses $1650/kW.

The campus line is a modelJLL/T&T 2026 global shell-and-core $11.3M/MW × 0.72 rural × 1.085 AI premium + $1.4M/MW hybrid rack liquid = $10.23M/MW × 350 MW = $3,581M. Rural 0.72 is our interpolation against Silicon Valley $13.3/W, not a West Texas bid. Tightens to Class 3 when quotes return.

4.2Cost breakdown

WBS$MBandKind
Campus halls + MEP
Includes halls, MV/LV distribution, dry/hybrid heat rejection. Excludes generation, lateral, fiber, camp, GPUs.
3580.52685.4–4833.7Estimate
Civil, pad, camp, roads180120–250Plan
Water, RO, tanks2212–35Plan
Gas lateral12890–165Plan
BESS6042–81Estimate
Fiber both legs1812–22Plan
Electrical equipment (inside halls, not additive)
Per-section N+1; campus-wide 5000 A busway takeoff is not used.
125.2n/aCalculated
Owned aero-equivalent block (campus)1025871–1179Estimate
Rental generation capex (first power)0n/aPlan
Direct (rental case)3988.5
Soft costs 12%478.6
Contingency 20%893.4
Total rental (halls, gen rented)5360.5
Total owned campus (headline)6738.1

Electrical equipment check (125.2 $M) sits inside campus halls. Per-section N+1 killed the campus-wide 5000 A busway takeoff. Do not add the equipment check twice. Capex excludes GPUs: true.

02,0004,0006,000Halls + MEPCivil, pad, campWaterGas lateralsBESSFiberOwned generationCampus P50$M
Figure 4.1. Capital stack, owned campus, GPUs out. The last bar is the P50 total.
Electrical 42%Cooling 22%Shell 14%Site 12%Soft 10%Electrical 42%Cooling 22%Shell 14%Site 12%Soft 10%Campussplit
Figure 4.2. Industry 2026 split, reweighted onto this WBS. Orientation, not a bid.

4.3Unit economics

  • $15.3M per MW IT built (rental case, GPUs out).
  • Fuel $24.71/MWh at the campus boundary. Heat rate 9,150 Btu/kWh (9.15 MMBtu/MWh).
  • Annual fuel ~$77.8M at CF 0.7, on 3,147,424 MWh and 28,799,036 MMBtu.
  • Gas burn 78.9 MMcf/d. Palo Duro’s certificated 80,000 Dth/d is roughly 29.6 MMcf/d, which is the first-power tranche and not this.
  • Capex spread over 15 years at that CF: roughly $209/MWh-IT owned (rental halls-only $167). A finance sketch, not LCOE.
  • CUE 0.586 kgCO2/kWh-IT · 1,528,071 tCO2/yr at CF 0.7, which is 20.4× the 75,000 tpy PSD greenhouse-gas trigger. Title V and PSD/GHG BACT are required. EPA NG EF, no methane leakage.
  • Efficiency-driven operating cost is the fuel line plus dry-plant water (small) plus people. SG&A is not included.

Fuel only, not all-in LCOE. Heat rate 9.6 MMBtu/MWh on Waha $2.10 plus an assumed $0.60 of transport, with the Palo Duro tariff still unfiled. Annual $M scales with compiled facility MW at 70% CF. Campus opex (people, water RO, maintenance) is not in this number. Capex $/MWh-IT is P50 owned-campus spread over 15 years at 70% CF, which is a finance sketch rather than LCOE. The full case with debt service and coverage is in the finance block.

4.4Sensitivities

One lever at a time on the owned-campus total, loaded with soft cost and contingency. Campus dollars per megawatt is the wide bar. Owning versus renting generation is binary. The laterals are small in dollars and large in schedule.

Fiber both legs vs oneBESS ±30%Gas laterals $90–165M vs $…Contingency 15–30% vs 20%Rural factor 0.62–0.85 vs …Rent generation instead of…Campus $/MW IT ±20%-1,000-50005001,000Fiber both legs vs one: -12.1BESS ±30%: -24.2Gas laterals $90–165M vs $128M: -51.1Contingency 15–30% vs 20%: -280.7Rural factor 0.62–0.85 vs 0.72: -576.7Rent generation instead of owning: -1,378Campus $/MW IT ±20%: -962.4Fiber both legs vs one: 0BESS ±30%: 24.2Gas laterals $90–165M vs $128M: 49.7Contingency 15–30% vs 20%: 561.5Rural factor 0.62–0.85 vs 0.72: 749.8Rent generation instead of owning: 0Campus $/MW IT ±20%: 962.4Change vs P50, $MDownsideUpsideP50 $6,738M
Figure 4.3. Tornado around owned-campus P50 $6,738M.
LeverDownUpΔ $M
Campus $/MW IT ±20% Estimate
Finite difference on the Class-4 campus line, loaded with soft+contingency. Not autodiff.
5775.77700.5716.1
Rent generation instead of owning Selected
Binary. Campus headline is owned aero-equivalent. Rental is the first-power bridge.
5360.56738.11377.6
Rural factor 0.62–0.85 vs 0.72 Estimate
How much West Texas actually discounts Silicon Valley.
6161.47487.9749.8
Contingency 15–30% vs 20% Selected6457.47299.6561.5
Gas laterals $90–165M vs $128M Plan66876787.838
BESS ±30% Estimate6713.96762.318
Fiber both legs vs one Plan
A single lateral reads as Tier-2-only to tenants.
67266738.19

4.5Contingency

AACE 44R-08 risk-based placeholder. Class 4 typical 15–30%. 20% used until the risk register is Monte-Carlo'd on the WBS.

20% on (direct + soft) = 893.4 $M. Class 4 typical 15–30% is itself a tornado lever. AACE 44R-08 would replace this placeholder with a risk-register Monte Carlo on the WBS once quotes exist.

4.6Returns

Coverage is 0.78 against a 1.35 covenant. The case does not finance itself at 165 $/kW-month on this capex.

Yield on cost is 4.96% against debt at 7.80%. Every borrowed dollar dilutes the equity return, so more leverage makes this worse rather than better. The problem is the cost basis and the price, not the capital structure.

$624MContracted revenue / yrEstimate
$334MEBITDA (54% margin)Estimate
4.96%Yield on costCalculated
0.78DSCR vs 1.35 covenantCalculated

Revenue is a single contracted tenant at $165/kW-month with a 90% take-or-pay floor over 15 years. Against $6,738M of capital at $19.25M per MW IT, that is $4,043M of debt at 7.8% over 18 years and $2,695M of equity. Debt service is $425M a year, which EBITDA does not cover.

Annual operating cost, abated basis
Line$M / yr
Fuel, at plant heat rate77.8
Generation O&M23.6
Facility O&M80.9
Insurance37.1
Property tax, abated28.3
Staffing29.7
G&A12.5
Total289.8
Fuel 27%Generation O&M 8%Facility O&M 28%Insurance 13%Property tax (abated) 10%Staff 10%G&A 4%Fuel 27%Generation O&M 8%Facility O&M 28%Insurance 13%Property tax (abated) 10%Staff 10%G&A 4%290$M / yr
Figure 4.4. Annual operating cost, abated basis. Fuel is the large slice.

Property tax runs at 28.3 $M abated against 80.9 $M unabated. Nobody has asked King County for the abatement, and coverage falls to 0.66 without it. It is the largest uncontracted line in the model. Pending

What has to be true

Breakeven is $229.9/kW-month against the $165 assumed, a 39% gap. Each lever below closes it on its own.

LeverFromToMoveRead
Contract price165 $/kW-month230 $/kW-month+39%Above current liquid-cooled comps. Would need scarcity pricing on firm power, which a queue-constrained ERCOT does supply.
Capex$19.3M/MW$12.8M/MW-33%The halls line is a per-MW market index with no scale curve. A campus of identical halls should buy better than the index, and the 20% Class 4 contingency retires with design.
Both, split evenly$19.3M/MW at 165 $/kW-month$16.0M/MW at 197 $/kW-monthhalf of eachThe realistic path. Neither lever has to move the whole way.

Coverage against price and capital cost

$/kW-moCapex −15%BaseCapex +20%
1354.3% / 0.683.3% / 0.522.4% / 0.38
1505.2% / 0.834.1% / 0.653.1% / 0.49
1656.2% / 0.985.0% / 0.783.8% / 0.60
1807.2% / 1.145.8% / 0.924.5% / 0.71
1958.2% / 1.296.6% / 1.055.1% / 0.81
Yield on cost and DSCR at each contract price. Covenant is 1.35; nothing at today's comps clears it.

Scale economics across the phases

PhaseMW ITCapex$M/MWIf linearExponentDSCRBreakeven
P1 First power, rented generation100$1,761M17.61$1,580M0.9130.62$242
P2 Atlas Phase 2 campus, owned conversion350$6,906M19.73$6,906M10.76$234.8
P3 Grid connection; campus already live350$6,906M19.73$6,906M10.76$234.8
Capex scaled line by line rather than as a flat per-MW index. Shared plant and route costs do not repeat, so Phase 2 prices better per MW than first power. Phase 3 is the same campus on the grid. Phase 4 toward 3 GW is not in this compile.
Model limitsNo construction interest, no financing fees, no working capital, no GPU capital, no residual value and no tax equity. Revenue is a single contracted tenant at one price. Property tax is the largest uncontracted line and King County has not been asked for an abatement. A merchant or multi-tenant case is a different pack.

Returns are calculated from this Class 4 capex and the contract price in the model. They are not fitted to a target IRR.

Open items

  • Tenant term sheet: price, term, take-or-pay floor, escalator, credit Pending
  • King County and Guthrie ISD abatement posture before FID Pending
  • Firm gas price beyond the Waha strip, and who carries basis risk Pending
  • Whether GPUs are tenant capital; the case above assumes they are Pending

4.7Incentives, districts, and plats

Separate plats for campus, generation, and any later solar/BESS so each asset can be financed and incentivized apart; infrastructure by cross-access easements. A solar/BESS plat would not qualify for JETI; the gas plant and campus may.

  • TIRZ (Tax Code Ch. 311)
  • Municipal Management District (LGC Ch. 375)
  • County Ch. 381 economic-development agreements
  • JETI Act (HB 5 / Gov't Code Ch. 403 Subch. T) covers dispatchable generation, manufacturing, critical infrastructure. Renewable generation and storage excluded.
  • Data-center sales-tax exemption (§151.359)
  • Freeport exemption

SB6 / proposed PUCT 25.194 security (~$50k/MW posted + $50k/MW non-refundable) applies to a grid path. This campus does not file until Phase 3. A 350 MW filing is on the order of $35M at risk.

Commissioning, commercial, sustainability

  • ASHRAE Guideline 0 / Standard 202. not started. Owner's project requirements and basis of design are this report's job to start, not to finish.
  • Data-center Levels 1–5 + integrated systems test. EPC. Factory, receipt, installation, functional, integrated. After halls exist.
  • QA/QC ISO 9001. EPC. Procurement of the builder, not this solve.
  • HSE OSHA 1926 / NFPA 70E. EPC. Arc-flash PPE category in this design is a draft input.
  • Handover COBie / as-builts / manifest as twin. later. run_id is the seed of that twin. IFC not emitted in this design.
  • Form of contract. EJCDC / ConsensusDocs / FIDIC Silver, owner's choice Pending
  • Liquidated damages. Not set. TTP P50/P90 are a model, not a contract date. Pending
  • Contractual PUE / WUE. Do not write until TMY + wells + rack schedule exist. Selected
  • Warranties / bonding. EPC and OEM. Not this Class 4. Pending
  • GPU capex. Excluded from the stack on purpose. Selected
  • PUE. computed in this design from cooling mix Design PUE only until commissioned.
  • WUE. assumed dry mid-band Illegal to evaporative against MAG 49.
  • CUE. sketch from heat rate × EPA NG EF; no methane leakage, no Scope 3 24/7 CFE accounting is a later plat (solar is JETI-excluded).
  • LEED BD+C. not pursued in this design Owner election.