Soluna Holdings (NASDAQ: SLNH) has announced a definitive agreement with Applied Digital (NASDAQ: APLD) to jointly develop a 50 MW artificial intelligence data center in the Texas Panhandle.
The two companies will form a jointly owned entity to develop the facility at Project Dorothy 3, Soluna’s existing site in the Texas Panhandle region.
Under the terms of the Transaction Agreement, Soluna is expected to contribute a portion of the Dorothy 3 site, including land and power-related project assets, to the new Project Company.
Applied Digital is expected to provide the capital needed to support development of the project, reflecting its role as a proven builder and operator of AI data center infrastructure.
Upon closing, Applied Digital is expected to hold a 51% interest in the Project Company, with Soluna retaining the remaining 49% stake.
The new facility will draw energy from the adjacent Briscoe Wind Farm, consistent with Soluna’s core business model of co-locating data centers directly alongside renewable energy sources.
A third company, ChronoScale Holdings, has already indicated its intention to lease the facility, giving the project a prospective tenant even before construction begins.
The deal is not Soluna’s first venture in the area, as its Dorothy 1 campus is already operational with 50 MW of capacity and has been the focus of the company’s vertical integration efforts.
For Applied Digital, the appeal lies in access to a site with a 150 MW wind generation source directly adjacent to the land, along with existing grid connectivity.
John Belizaire, CEO of Soluna, framed the deal as a direct validation of the company’s long-term strategy for bringing computing load to energy sources rather than the other way around.
“We have said for a long time that the constraint in AI is energy access, not chips,” said Belizaire, adding that “we built Soluna to bring load to the generation, so the power would be ready when the demand arrived.”
Belizaire described the partnership as putting that strategy to work directly, saying it combines “our site and wind power, combined with a proven builder and operator of AI data centers.”
The transaction effectively converts Soluna’s land and power assets into a near-half stake in an operational AI facility with a tenant already in view, strengthening the company’s position in the booming data center market.
