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TeraWulf doubles Kentucky data center power to 1 GW

TeraWulf doubles Kentucky data center power to 1 GW

Built World

TeraWulf's CEO says rivals' stalled projects are its opportunity, as the 1 GW Kentucky deal awaits state approval

October 26th, 2026: TeraWulf shares rise 7% after CEO's pushback

Overview

Updated Nov 2

TeraWulf has doubled the contracted power for its Muskie data center in eastern Kentucky from 500 megawatts to 1 gigawatt. The amended Kentucky Power agreement, announced October 5, 2026, pulls the second 500-megawatt phase from 2030 to 2029. Written comments on the Boyd County transmission route were due October 29, and Kentucky Power has said it expects to file the contract with state regulators by November.

Chief executive Paul Prager used the weekend of October 24-25 to push back on Elon Musk's warning about 'stranded compute' in half-built data centers. Prager said TeraWulf lines up power, fixed-price construction contracts and investment-grade tenants before it builds. TeraWulf shares, down more than 60% since June, rose 7% on October 26.

Why it matters

A 1-gigawatt data center can be built without raising existing customers' rates — the developer pays for transmission, generation, and $100 million in bill credits.

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Key Indicators

1 GW
Contracted power at Muskie campus
Doubled from 500 megawatts under the amended Kentucky Power agreement.
$100M
Residential winter bill credits funded by TeraWulf
$10 million a year for 10 years, shown on January-to-March bills starting in 2029, pending PSC approval.
2029
Second 500 MW phase delivery year
Advanced from 2030. Service ramps from 100 MW in October 2028 to 1,000 MW by October 2029, subject to approvals.
$756M
TeraWulf financial guarantees to Kentucky Power
Collateral required under the amended agreements, separate from its electricity and bill-credit payments.
760 MW
Big Sandy combined-cycle gas plant capacity
Kentucky Power's planned plant, with financing costs covered by TeraWulf.
$11.32
TeraWulf closing share price, October 23
Lowest weekly close in at least six months; the stock is down more than 60% since June.

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People Involved

Paul Prager
Paul Prager
Chairman and CEO, TeraWulf Inc.
Arguing that rivals' stalled data centers are TeraWulf's opportunity as the stock recovers from a six-month low
CW
Cindy Wiseman
President and COO, Kentucky Power
Overseeing the transmission and generation buildout for Muskie

Organizations Involved

TeraWulf Inc.
TeraWulf Inc.
Publicly traded digital infrastructure company (Nasdaq: WULF)
Developing the 1 GW Muskie Data Campus and pitching rivals' stalled projects as a buying opportunity

A vertically integrated owner and operator of large-scale digital infrastructure, focused on AI and high-performance computing hosting.
Kentucky Power
Kentucky Power
Regional electric utility, American Electric Power subsidiary
Written comments on its Boyd County transmission project were due October 29; the utility says it expects to file the amended TeraWulf contract with state regulators by November

The electric utility serving eastern Kentucky, now planning dedicated infrastructure for TeraWulf's Muskie campus.
KP
Kentucky Public Service Commission
State regulatory agency
Must approve the amended agreement for the schedule to hold

The agency regulating electric utilities in Kentucky, whose approval is required for the amended TeraWulf-Kentucky Power contract.

Timeline

May 2026 October 2026

6 events Latest: October 26th, 2026 · 2 weeks ago
Tap a bar to jump to that date

  1. TeraWulf shares rise 7% after CEO's pushback

    Latest Market

    The stock rebounded from a six-month low as AI infrastructure shares recovered. TeraWulf had lost more than 60% of its value since June.

  2. Prager calls rivals' stalled data centers a 'development pipeline'

    Statement

    TeraWulf CEO Paul Prager pushed back on Elon Musk's warning about 'stranded compute' in half-built data centers, saying TeraWulf secures power, fixed-price construction contracts and investment-grade tenants before it builds.

  3. Kentucky Power opens public comment on Boyd County transmission project

    Infrastructure

    The utility held an open house in Catlettsburg on the proposed Venator 765-kilovolt substation and connecting 765-kilovolt and 345-kilovolt lines, with written feedback requested by October 29. Routes have not been selected; the facilities are scheduled for service in October 2028.

  4. TeraWulf and Kentucky Power sign amended 1 GW agreement

    Agreement

    Amended contract doubles Muskie's contracted power to 1 GW and moves the second 500 MW phase from 2030 to 2029, pending PSC approval.

  5. TeraWulf expands senior secured revolving credit facility

    Financing

    TeraWulf increased borrowing capacity for its AI data center buildout, according to a report on its late-October comments.

  6. TeraWulf acquires Muskie campus

    Acquisition

    Bought the roughly 285-acre site at EastPark Industrial Park from Industrial Equity Partners for AI and high-performance computing development.

Scenarios

1

Kentucky PSC approves TeraWulf's 1 GW power deal

Likely Resolves by Q2 2027

Discussed by: Company filings and industry coverage (ENR, Data Center Dynamics)

Kentucky Power files the amended contract and the PSC issues a final order approving it. Construction on the Venator substation then starts on schedule, and the second 500 MW phase delivers by 2029 as accelerated.

2

Regulatory review or construction delays push the schedule

Possible Resolves by End of 2029

Discussed by: Company filings note delivery is subject to PSC approval and Kentucky Power's construction calendar

The PSC takes longer than expected, or permitting, equipment procurement, or transmission queue delays push substation construction past its February 2027 target, sliding second-phase delivery beyond 2029.

3

Muskie grows toward 2 GW with anchor tenants

Possible Resolves by End of 2028

Discussed by: TeraWulf says it continues evaluating up to 2 GW; Private Infrastructure Daily notes capacity is contracted before tenants

TeraWulf signs one or more AI or high-performance-computing anchor tenants for the 1 GW and advances planning for additional capacity up to the 2 GW the site could support, subject to further utility and regulatory work.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

2023-2024

Bitcoin miners pivot to AI hosting (2023–2024)

Core Scientific filed for Chapter 11 bankruptcy in December 2022 after crypto prices collapsed, then emerged in January 2024 and signed a multibillion-dollar deal with CoreWeave to host AI graphics processing units at its power sites.

Then

Core Scientific's pivot became a template for bitcoin miners to monetize their power infrastructure by renting it to AI companies instead of hashing bitcoin.

Now

Power capacity, not land or hardware, became the scarce asset that miners could sell to AI firms.

Why this matters now

TeraWulf, which local coverage still describes as a bitcoin mining company, is executing the same pivot at Muskie — buying and contracting power infrastructure to host AI and high-performance computing workloads.

2023-2026

The data center grid bottleneck (2023–2026)

As AI computing demand surged, available grid capacity replaced land and capital as the main constraint on new data centers. Utilities announced multi-year transmission buildouts and developers began contracting power before signing tenants.

Then

Power procurement became the gating step in data center development, with developers announcing capacity deals ahead of customer agreements.

Now

Utilities and regulators developed structures — customer-funded infrastructure and ratepayer protections — to manage large new loads.

Why this matters now

TeraWulf's deal is a concrete instance: it contracted 1 GW with no named tenant, the substation is the gating item, and the company funds the grid buildout and $100 million in residential credits.

Sources

(18)
+12
TeraWulf Inc. (investor relations) Engineering News-Record Construction Review Online Data Center Dynamics Private Infrastructure Daily StockTitan WKYT The Daily Independent Kentucky Power Data Center Feed WEKU The Herald-Dispatch Stocktwits Yahoo Finance 24/7 Wall St. StockTitan TeraWulf Inc. (investor relations) Kentucky Power