As data centers expand in Michigan, so do environmental and economic concerns
As data center development expands across Michigan, communities are raising environmental and economic concerns, particularly regarding water usage and electricity demands. Roughly 50 communities have enacted temporary moratoriums on data center construction. Governor Whitmer has championed tax incentives for data centers, leading to backlash over specific projects like 'The Barn' in Saline Township.
The rapid expansion of data centers in Michigan is raising significant environmental and economic concerns across the state. Residents in numerous communities fear their areas are slated for data center construction, leading approximately 50 communities to implement temporary construction blocks, some lasting up to a year.
Michigan's appeal to tech companies like Microsoft and Google stems from its access to fresh water from the Great Lakes, crucial for cooling operations, and state-level tax incentives. Governor Gretchen Whitmer signed laws eliminating Michigan's 6% sales and use tax on eligible data center construction and equipment, aiming to attract investment and create jobs.
However, these developments have generated controversy. Governor Whitmer and tech company leaders faced backlash over a 2.2 million square foot data center project in Saline Township, known as "The Barn." Concerns include the deceptive abundance of freshwater given existing groundwater shortages, and the massive energy consumption of these facilities, with some projected to use as much power as DTE Energy's Fermi nuclear plant. Michigan Attorney General Dana Nessel has sought to limit the impact on energy customers, particularly regarding DTE Energy's ex-parte approval process for supplying power to such projects. Opponents also question the advertised economic return on investment, citing high per-job subsidy costs for data centers that typically employ few people long-term.