Microsoft has signed a long-term energy agreement with Indiana-headquartered regulated utility NiSource to power its planned data center campus in northern Indiana.

The 20-year contract will commence in 2028, at which time Microsoft is expected to begin offtaking power for the facility.

As part of the agreement, the utility's power portfolio will be increased by around 1.1GW, with NiSource expected to provide the transmission and generation infrastructure to power the data center.

The power will be delivered via NiSource’s subsidiary NiSource Generation Company LLC (GenCo). The campus will be served under a new large-load rate structure, which the utility claims is designed to protect existing customers from price rises. As part of the rate class, large-load users must fund the generation and infrastructure needed to power their facilities.

In connection with the deal, GenCo has contracted 600MW of battery storage under a tolling agreement. The storage facility is set to be constructed by an affiliate of AGP Group.

“Affordability is not separate from economic development; it is a key pillar of our GenCo model,” said NiSource president and CEO Lloyd Yates. “This agreement reflects the balanced approach we believe is needed for Indiana to attract significant investment and create long-term jobs."

“Microsoft has always been committed to paying our own way and identifying long-term solutions like this one to ensure that our data centers don't increase electricity prices for other ratepayers," added Jeff Riles, senior director of energy markets, Microsoft. "Our partnership with NIPSCO will not only support continued growth and protect ratepayers but also help to support a reliable grid for years to come that the communities of Northern Indiana rely on.”

While not explicitly confirmed, it seems likely that the agreement will serve Microsoft’s under-construction data center in La Porte.

Microsoft's La Porte plans have been underway since at least 2024 , when the company announced it would build a 245,000 sq ft (22,800 sqm) data center on 489 acres at Radius Industrial Park as part of a $1bn investment in Northwest Indiana.

The first phase would include six data centers and a substation on the initial plot.

In April 2026, Microsoft revealed it was now planning to establish 17 buildings on an expanded plot of land between East 250 South, East State Road 4, and Stevens Road in La Porte. How many of these will be data centers is unclear. Microsoft also owns 939 acres in Mishawaka, Indiana, which is also thought to be set for a data center.