TL;DR · 30-second read
The Short Version
TeraWulf, a company that used to mine bitcoin, has lined up the artificial intelligence developer Anthropic as the tenant for a giant computer campus on the site of an old aluminum plant in Kentucky.
The lease runs 20 years and is estimated to be worth about $19 billion. Its computers will use about as much electricity as a small city. Averaged out, the yearly rent would be more than five times what TeraWulf now takes in from sales in a year.
The takeaway: for artificial intelligence, the scarce ingredient is electricity, and an old factory already wired for enormous power loads was the prize.
StocksToTrade reported on October 2, 2026 that TeraWulf Inc. (Nasdaq: WULF) has secured Kentucky Public Service Commission approval for a Retail Electric Service Agreement providing up to 482 megawatts (MW) of power to its Justified Data Campus, a repurposed former aluminum smelter, and that the campus is anchored by a 20-year lease with Anthropic covering roughly 401 MW of critical IT load. The lease carries options to extend by up to 10 more years and an estimated $19 billion of contracted revenue, backed by expected investment-grade credit. Initial investment in the project is estimated at $4.0–4.5 billion.
WULF shares rose 4.15% on the day, closing near $15.49 after a pullback from the $17–18 range in early September. The same period brought a run of analyst initiations: Wells Fargo, UBS, Freedom Capital and Jones started the stock at Buy or Overweight with targets from $19 to $30, while Rothschild & Co Redburn started at Neutral with a $15 target.
Executive Summary
TeraWulf, a U.S. company that built its business mining bitcoin, is turning a former Kentucky aluminum smelter into an AI data center campus with Anthropic as its anchor tenant. The two numbers at the center of the deal — 482 MW of approved power and a 401 MW lease — sit close enough together that the lease reads as sized to fit inside the power the state regulator signed off on.
That is the significance for the wider market. AI developers need enormous, reliable electricity, and power access is widely described as the main bottleneck in building data centers for them. A site that already carries heavy industrial power infrastructure, paired with a regulatory approval, gives a landlord something a tenant will commit to for 20 years before the buildings exist.
For TeraWulf, the lease implies revenue on a scale far beyond anything its mining business has produced. It also means the story now turns on execution and financing: roughly $4 billion or more must be spent before that revenue arrives.
The Lease Fits Inside the Power Approval
Two numbers explain this deal. The Kentucky Public Service Commission, the state’s utility regulator, approved a Retail Electric Service Agreement — in effect a large-customer supply contract with the local utility — for up to 482 MW at the Justified Data Campus. Anthropic’s lease covers roughly 401 MW of critical IT load, meaning the power reserved for the servers themselves, before cooling, power conversion and building systems. The difference is about 81 MW, so the approved supply is roughly 1.2 times the IT load. That ratio is consistent with the overhead a modern, efficient facility needs for cooling and electrical losses, which suggests the tenant commitment was sized to the power envelope rather than the other way round.
That ordering matters for anyone valuing a converted miner. The expensive part of the campus is still ahead: the $4.0–4.5 billion of initial investment is planned spending, not completed construction. What TeraWulf could offer a 20-year tenant today is a site with heavy power infrastructure already in place and a regulatory path to nearly half a gigawatt of supply. In that sense the grid connection — not the buildings, and not bitcoin mining hardware — is the asset Anthropic is committing to.
The consequence reaches several groups. Utilities and state regulators become gatekeepers of AI leasing, because their approvals set how much capacity a landlord can sell. Owners of retired heavy-industry sites hold something newly valuable. And tenants sign multi-decade commitments whose value depends on construction that has not yet happened.
Why an Old Smelter Beat a Greenfield Site
Aluminum smelting is among the most electricity-hungry industrial processes, so smelter sites are typically built with high-voltage connections and substations sized for very large, continuous loads. Repurposing one is a “brownfield” project — building on previously developed industrial land — as opposed to a “greenfield” build on empty land that must wait for new transmission and utility upgrades. Wells Fargo, launching coverage with an Overweight rating and a $30 target, highlighted exactly this point: existing infrastructure cuts both time and capital spending compared with starting from scratch.
Notably, the flagship is not a converted bitcoin mine. What TeraWulf’s mining history appears to contribute is experience in finding, contracting and energizing industrial-scale power, rather than the mining sites themselves. That distinction matters for investors who value miners on the megawatts they already run: this deal suggests the premium goes to power that can be delivered at data-center quality and scale, wherever it sits, and to the ability to get it approved.
It also shows who is signing. Anthropic, an AI developer, is named as the direct tenant of a former miner. One deal does not make an industry trend, but Wells Fargo’s reference to an 839 MW contracted capacity pipeline across three tenants indicates TeraWulf is building a portfolio around this model rather than a one-off project.
$19 Billion of Revenue, $4 Billion-Plus of Spending First
Simple division puts the estimated $19 billion of contracted revenue at an average of about $950 million a year over the 20-year base term — a rough figure that ignores rent escalators and the construction ramp. That is more than five times TeraWulf’s trailing revenue of about $168.5 million. Against it sits an estimated $4.0–4.5 billion of initial investment, or roughly $10–11 million per megawatt of IT load.
The spending comes first. TeraWulf reported free cash flow of about −$992 million in its latest quarter, raised more than $1.1 billion of equity and put over $1.0 billion into property and equipment. Debt is modest relative to equity, at about 0.16, but working capital is negative and the current ratio — short-term assets divided by short-term liabilities — is below 1. In plain terms, the company is spending well ahead of the cash the lease will eventually produce.
This is where “expected investment-grade credit” carries weight. A long lease backed by investment-grade credit — a rating signaling low default risk — is the kind of contract lenders will finance against. If that support materializes as described, much of the build could be funded with debt rather than further share sales; if it does not, the burden shifts back toward equity and dilution of existing shareholders.
Where the Bulls and the Skeptics Actually Disagree
Analysts largely agree on the asset and differ on the backdrop. Wells Fargo ($30, Overweight), UBS ($24, Buy, arguing a fully leased development portfolio could be worth up to $30 a share), Freedom Capital ($19, Buy, with a “floor” near $14) and Jones ($30, Buy) frame TeraWulf as a favored AI infrastructure name, and FactSet data put the consensus at Buy with a mean target in the mid-$30s.
Rothschild & Co Redburn’s Neutral rating and $15 target — close to where the stock closed — rests on a different question: not whether the Kentucky campus is valuable, but whether tightening credit markets and the balance sheets of hyperscalers, the largest cloud providers, will keep funding AI buildout at the current pace. That is a fair challenge to a business built on long-dated tenant commitments and borrowing against them. Equally, the bull case rests on a named tenant and a regulatory approval, which are concrete rather than speculative.
Concentration is the risk both camps must weigh. One tenant anchors the flagship, and a 20-year lease is only as strong as that tenant’s ability to pay through cycles in AI spending. Delivering 401 MW of capacity on schedule is the near-term test that will settle which view was closer.
Background
TeraWulf Inc. (Nasdaq: WULF) built its business as a U.S. bitcoin miner, running large fleets of specialized computers that draw electricity around the clock. That model depends on securing large amounts of reliable, low-cost power — the same input that AI data centers need. As demand for AI computing has surged, TeraWulf and other public miners have begun converting capacity into data centers that host AI workloads, shifting from mining revenue toward long-term leases.
Anthropic is an AI developer whose models require very large amounts of computing capacity. In data center leasing, “critical IT load” measures the power available to the servers, and state utility regulators such as the Kentucky Public Service Commission approve the supply agreements that make large new loads possible — which is why power approvals have become central milestones in AI infrastructure projects. Source: WULF Stock Rallies As Massive Anthropic AI Deal Takes Shape — StocksToTrade on TeraWulf’s Kentucky power approval, Anthropic lease and analyst coverage.Sources