Data centers warn of national security threat if centers don’t develop
Illinois Governor J.B. Pritzker has reversed course on providing tax exemptions for data centers, citing concerns over energy and water consumption and utility costs. The Data Centers Coalition argues that restricting these incentives could harm economic development in Illinois and pose a national security risk by discouraging domestic data storage.
Illinois Governor J.B. Pritzker has announced a reversal on state tax exemptions for data centers, stating developers need to address environmental concerns related to energy and water usage, and impact on utility bills. This marks a shift from 2019, when Pritzker and a bipartisan group of state legislators had supported policies providing such incentives.
The Governor's decision, which he articulated at the Aspen Climate Summit, emphasizes the need for data center companies to "bring energy with them" and implement "closed loop systems" to prevent water contamination and excessive usage. He stressed that large tech companies have the resources to meet these requirements without incentives.
Dan Diorio, Executive Vice President of the Data Centers Coalition, expressed concern that the withdrawal of tax credits would be detrimental to economic development in Illinois and elsewhere, arguing that the exemptions encourage the use of modern, energy-efficient equipment. He also highlighted the importance of domestic data storage for national security.
Pritzker's policy change has drawn political commentary, with his November election opponent, former state Sen. Darren Bailey, criticizing the Governor for burdening Illinois families with higher electric bills. Independent candidate Collin Corbett has also expressed intentions to curb "unchecked data center growth."