TeraWulf doubles its Kentucky power draw to 1 GW with $100 million in bill credits, none of it filed yet
The pledge rests on a builder that spent $855 million on construction last quarter against $44.8 million of revenue. The decade of winter credits does not reach a Kentucky mailbox until 2029.
Vincent Jiang · 4 min read
A $25 winter discount, dated 2029
On October 5, 2026, Kentucky Power and TeraWulf (Nasdaq: WULF) finalized an amended contract that doubles the developer's contracted power at its Muskie campus in Grayson, Kentucky, from 500 megawatts to 1 gigawatt, and pulls the second 500-megawatt phase forward to 2029 from 2030 1. TeraWulf, a former bitcoin miner now building data centers, also agreed to pay the estimated financing costs of the utility's planned 760-megawatt Big Sandy gas plant; the construction bill stays with Kentucky Power, a unit of American Electric Power 12.
Wrapped inside is a decade of winter bill credits for the utility's roughly 163,000 customers across 20 eastern Kentucky counties: $100 million funded by TeraWulf, about $25 a month for a typical home in heating season, starting in 2029 1.
One customer the size of the whole territory
No tenant has been named for the 285-acre site at the EastPark Industrial Park, bought in May, where TeraWulf estimates $4.0 billion to $4.5 billion of investment in site development and its first data halls 34. Kentucky Power development director Amanda Clark frames the stakes in household terms: the campus "equates to essentially all the other customers that we have," and without new load the utility would need 175,000 new homes to steady its rates 5.
Nothing is filed, and the arithmetic is tight
The protections behind the promise stay undisclosed until Kentucky Power files the contract with the state Public Service Commission later this year 12. What is fixed already is the floor: a March 2025 commission order for loads above 150 megawatts set a 20-year initial contract, minimum bills on 90 percent of contracted demand, and collateral worth 24 times the largest monthly non-fuel bill 2.
The $25 figure deserves a check: paid across a five-month winter, it would total roughly $1,250 a household over ten years, and about $200 million across 163,000 homes 1, double the pledge. The release never says how many winter months the $100 million covers, and that count is the first thing the unfiled contract must answer.
Several Kentucky communities have paused data centers by moratorium, and Governor Andy Beshear's executive order on data-center development bars utilities from raising rates to cover them 56.
The buildout outruns the business
TeraWulf earned $44.8 million last quarter, down 6 percent from a year earlier, and lost $1.94 a share against an expected 24-cent loss, carrying debt-to-equity of 27.25 7.
Capital spending hit $855 million in the same quarter, about nineteen dollars of construction for every dollar of revenue, on debt that has climbed from roughly half a billion dollars at the end of 2024 to $5.2 billion 8. Another $3.5 billion is planned, the company's first leveraged loan plus high-yield bonds with Morgan Stanley−2.72% — Morgan Stanley, down 2.72 percent today leading, finance chief Patrick Fleury told Bloomberg 9.
TeraWulf's debt went from half a billion dollars to $5.2 billion in six quarters
Data
| Total debt | |
|---|---|
| Q4 '24 | $0.49B |
| Q1 '25 | $0.49B |
| Q2 '25 | $0.5B |
| Q3 '25 | $1.09B |
| Q4 '25 | $5.2B |
| Q1 '26 | $5.31B |
| Q2 '26 | $5.24B |
The stock fell 5 percent on announcement day and has drifted lower since, trading near $12.98 on October 13, well under half its 52-week high of $29.84 1011. TD Cowen turned positive this week all the same: StreetInsider logs the firm initiating coverage at Buy, while MarketBeat, citing Zacks, reports the Monday note as an upgrade to strong buy, into a $32.86 consensus target 127.
TeraWulf's quarterly capex now runs about 19 times its revenue
- Revenue
- Capex
Data
| Revenue | Capex | |
|---|---|---|
| Q3 '24 | $0.03B | $0.02B |
| Q4 '24 | $0.04B | $0.13B |
| Q1 '25 | $0.03B | $0.09B |
| Q2 '25 | $0.05B | $0.12B |
| Q3 '25 | $0.05B | $0.23B |
| Q4 '25 | $0.04B | $0.61B |
| Q1 '26 | $0.03B | $0.52B |
| Q2 '26 | $0.05B | $0.86B |
The bull case has a precedent at Justified
TeraWulf's other Kentucky campus points the other way. Justified, a former aluminum smelter site in Hawesville, came energized, with a substation and about 482 megawatts of transmission capability already in place, and the AI company Anthropic$350B — Anthropic, private, latest valuation $350B leases about 401 megawatts there on a 20-year deal worth roughly $19 billion 311. The commission approved that contract in August, finding it protected existing customers 6.
Muskie starts from zero on power delivery: it needs a new 765-kilovolt Venator substation and about 8.5 miles of new transmission lines before a single server racks 313. Sister utility Indiana Michigan Power is cutting residential base rates 5 percent on its own large-load growth, the outcome Kentucky Power is selling 5.
The dates that decide it
The substation application reaches the commission this month and the line application in early 2027, with a decision expected in spring 2027 and service targeted for October 2028 13. Residents review transmission routes at a October 15 open house in Catlettsburg, with comments due October 29 13, and the contract filing follows before year-end 1.
Third-quarter results land on November 6 11. Between now and any credit reaching a mailbox in 2029, everything runs through Frankfort, the state capital where the Public Service Commission sits.
Deepdive
AI-generated from this story and its cited sources. Not investment advice.
