TerraVolt options 1,077 acres for gas-powered Idaho data center campus

TerraVolt Holdings has secured options to buy about 1,077 acres in Idaho for a proposed data center campus designed to support an initial 240 megawatts of on-site natural gas generation.

The Tustin, California-based developer announced the agreements Friday for property outside Declo in Cassia County. TerraVolt, formerly CalEthos, kept its GEDC ticker on the OTCQB after changing its name in June. The company said it is in the early stages of developing a business that pairs data center building sites with dedicated power plants and utilities.

“These option agreements secure site control, allowing our team to advance land use plans, environmental due diligence, power plant, electrical distribution, and water treatment system designs, and county and state permitting,” Joel Stone, TerraVolt’s chairman and CEO, said in a statement.

TerraVolt said its proposed power system would operate independently of the electric grid, an arrangement the company describes as islanded, behind-the-meter generation. The company calls its business a Physical Infrastructure-as-a-Service platform and is targeting hyperscale and neocloud operators, colocation providers and data center developers seeking faster access to power.

“By pairing a strategic, expansive land parcel directly with firm gas supply and pipeline access, we are addressing the single largest bottleneck in the digital economy: the multi-year wait for large-load grid interconnections,” Stone said.

The company said the property is zoned Multiple-Use and lies along state Highway 81 near Interstate 84, long-distance fiber routes and Williams’ Northwest Pipeline. TerraVolt said a firm natural gas supply agreement for 55 billion British thermal units per day, which the company announced May 11 under the CalEthos name, would support the planned generation.

The agreements set a price of $30,000 per acre for land owned by Wickel Land Company LLP, according to a Form 8-K TerraVolt filed with the Securities and Exchange Commission. The company entered into the agreements Monday, with an effective date of Oct. 23.

Based on the stated acreage, the total purchase price would be about $32.3 million. About 903.3 acres would cost about $27.1 million in cash, and about 174.1 acres would cost about $5.2 million through a convertible secured promissory note. A survey will determine final acreage.

TerraVolt deposited $150,000 in option fees with TitleOne Corp., the escrow agent. Half is nonrefundable and payable to the seller, with half held in escrow pending exercise, termination or expiration. Both options must be exercised simultaneously. If TerraVolt exercises the options, the option fee and any extension fee would be credited against the purchase price.

The options expire Oct. 23, 2027, with a six-month extension available for $75,000. The agreements allow the option periods to pause when litigation, a government moratorium or similar circumstances beyond TerraVolt’s reasonable control materially delay or prevent development work or permit applications.

If TerraVolt discovers and verifies a problem affecting the property or its ability to proceed, it can terminate the agreements during the option period and recover half of the option fee and half of any extension fee. Qualifying issues include environmental conditions, zoning, land use, water rights, utilities, access, title and permitting.

At closing, TerraVolt would pay for the smaller parcel group with the note, whose principal would equal the purchase price for those parcels after applicable fee credits. The note would have a two-year term and bear interest at the lowest applicable federal rate at closing, compounded annually. It would convert into common stock at $5 per share, subject to specified adjustments, automatically on the 60th consecutive trading day with a closing share price of at least $5, or on the holder’s notice immediately before maturity. GEDC shares last traded Wednesday at 55 cents. If the note is divided among holders, that notice would require approval from holders of at least two-thirds of its principal. An unconverted note would be payable in cash at maturity, secured by a mortgage on the smaller parcel group. TerraVolt identified potential stockholder dilution from conversion as a risk.

TerraVolt intends to make cooling technologies with low water use, including closed-loop systems, a condition of each building-site sale. The company said those systems are designed to minimize or eliminate evaporative losses associated with conventional cooling towers.

The company said ongoing campus water use would be limited primarily to domestic needs and fire protection. It also said independent generation would protect local residential and commercial customers from grid strain or electricity rate increases.

TerraVolt must now obtain financing to exercise the land options and develop the campus. Its planned sequence calls for securing development approvals and completing civil work before selling construction-ready building sites. The company would then provide operators with power, fiber, potable and fire-protection water, wastewater treatment and other services under long-term infrastructure services agreements.