Data centers emerging as key issue in Illinois governor’s ra...
Data centers have become a key issue in the Illinois governor's race, with candidates debating tax incentives, utility costs, and environmental impacts. Governor Pritzker has paused tax incentives and proposed a two-year moratorium on new tax credits, pushing for regulations that require data centers to supply their own energy and use closed-loop water systems. Public opinion has largely shifted against the industry, driven by concerns over resource strain from AI-driven hyperscale facilities.
Illinois Governor JB Pritzker and his Republican opponent Darren Bailey are actively debating data center development and its impact, making it a key issue in the upcoming governor's race. Pritzker, who initially signed tax incentives for data centers in 2019, has since reversed course, pausing these incentives in June and proposing a two-year moratorium on new tax credits. This shift is driven by concerns over the strain on energy and water resources, especially from AI-driven hyperscale data centers, and a turn in public opinion against the industry. Pritzker advocates for new regulations that would require data centers to bring their own energy and implement closed-loop water cooling systems.
Bailey, while initially having voted against the 2019 incentive law, later supported its expansion in 2021. Now, he aligns with the public's concerns, blaming Pritzker for the initial incentives and advocating for immediate halts on tax breaks for all data center projects until their environmental and utility impacts are better understood. He also proposes that data centers pay into a fund for consumer utility bill relief and supply their own energy, while also suggesting a rollback of the state's climate legislation to boost fossil fuel energy production.
Both candidates, however, acknowledge the necessity of data centers for technological advancement. Industry advocates, like Brad Tietz of the Data Center Coalition, suggest that public opposition is often based on misconceptions and emphasize the economic benefits and essential services provided by data centers. Labor leaders, concerned about job losses due to the incentive pause, have proposed a legislative framework to restart incentives with new requirements like community benefit agreements, treated wastewater use, union labor, and a "bring-your-own-energy" model prioritizing renewables. Pritzker has yet to take a position on this labor proposal, emphasizing the need for responsible growth. Lawmakers are expected to address new regulations in the fall veto session.