Across Michigan, Local Governments Say No to More Data Centers
Data centers in Michigan don't have to be developments fraught with transparency and environmental concerns, U.S. Senate candidate Mallory McMorrow said Thursday as she released a policy plan to better regulate hyperscale digital infrastructure. A wave of more than 15 new data center proposals have come into communities across the state, including a 1.4-gigawatt facility planned by Oracle and OpenAI.
Another 19 communities have proposed or voted on moratoriums to temporarily halt new data centers as they consider limits on where, when and how the facilities can operate.
When it comes to data centers, Michigan has an opportunity to show the country how to do it right, McMorrow said in a statement announcing the plan, which also proposes requirements for data centers to source at least 90% of their projected electricity needs from renewable sources and use local union labor.
Michigan revolutionized auto manufacturing to be safer, cleaner, and union-built, she continued. We can do the same for data centers – and show the rest of the country how it's done.
The Growing Pushback
Data center debates have cropped up throughout Michigan as tech companies eye sites in at least 16 communities. The Township's planning commission in February adopted a six-month moratorium on data center projects amid community pushback. There are also several data centers that have already been built throughout the state, including the Switch Pyramid Campus in Gaines Township.
Tech giants like Microsoft have pushed local officials to sign non-disclosure agreements for potential data center developments, a practice McMorrow said she'd like to end. As a state legislator, McMorrow signed an NDA in 2023 to learn about potential economic development deals but later called it a broken system and proposed reforms.
That means data center companies, not Michigan families, will pay for their own energy, grid upgrades for the benefit of all ratepayers; pay their fair share in taxes to fund our schools, roads, and communities; and pay our workers by creating good-paying union jobs, she said in a statement.
Federal and State Responses
Several local governments across places like Minnesota and Michigan have enacted rules that would temporarily pause the construction of new data centers. And six states are trying to do so at the state level.
Vermont was the first to act, with several senators introducing a bill in the Vermont General Assembly that would freeze the construction of new data centers in the state until July 2030. During this period, Vermont's Public Utility Commission would lead an investigation into how these facilities could affect the state's natural resources, communities and economy.
Oklahoma lawmakers are considering a bill that proposes pausing data center construction until 2029, giving the Oklahoma Corporation Commission time to study their impacts. The commission would be tasked with inspecting how data centers could affect the state's water supply, utility rates, property values and other variables.
Maryland's House is considering an emergency bill that would prevent the construction of any new data centers, but existing facilities and those with all proper permits would be left alone.
Why the Concerns?
Data centers are notorious for consuming enormous amounts of electricity and water, often leaving local communities with higher energy bills and strained drinking water supplies. And if they don't use efficient energy sources, they can contribute to air pollution as well.
According to a 2025 report by the North American Electric Reliability Corporation, large portions of the East Coast, Midwest and Pacific Northwest will likely face energy shortfalls and more frequent outages as soon as 2028.
In addition to straining the grid system, data centers require massive volumes of water to keep cool and avoid overheating, competing with local communities for limited drinking water in regions ranging from the American West to the Great Lakes.
And if developers don't use sustainable energy sources to power data centers, this infrastructure could become a main driver behind increased fossil fuel production.
The Senate Race Factor
Democratic U.S. Senate hopeful Mallory McMorrow on Thursday became the latest Michigan candidate to call for increased guardrails around proposed data center developments, proposing a plan that would require transparency and local investments from corporations looking to build.
McMorrow and fellow candidate Abdul El-Sayed have both endorsed strict requirements for prospective data center developers. El-Sayed proposed Terms of Engagement for proposed data center projects in January, noting the size and scale of proposed facilities are causing alarm and concern about the impacts on water resources, electric bills and safety.
Data center developers and utilities should be held to binding agreements on keeping electric rates down, guaranteeing energy reliability, committing to a closed-loop cooling system to limit stress on local water resources and adhering to existing clean energy laws, according to his policy platform.
Both McMorrow's and El-Sayed's plans call for penalties for companies that don't adhere to ratepayer protections and environmental requirements or fail to deliver on job creation.
U.S. Rep. Haley Stevens, who is also seeking the Democratic nomination for U.S. Senate, told Bridge Michigan in a statement that her top priority when it comes to data centers is making sure costs don't go up for Michigan families and that we are protecting good-paying union jobs.
Stevens said there should be a clear, responsible policy framework for data centers and AI to ensure these technologies are developed safely and securely.
The Trade-Offs
State Sen. Mallory McMorrow in late 2024 voted for tax breaks to lure data centers to the state. Under the new law, developers can avoid paying sales and use taxes through at least 20250 if they invest at least $250 million, employ 30 people and meet other requirements. That could amount to hundreds of millions of dollars in tax breaks per facility.
The law also sought to ensure data centers use municipal water with available capacity and pay electric rates that do not cause residential customers to subsidize the costs of powering the facilities. At the time, critics feared the provisions wouldn't be enough to make the presence of data centers – and the tax breaks to lure them – a worthy tradeoff.
Since the new law took effect, data center developers have purchased land or pitched projects in at least 16 Michigan communities. Another 19 communities have proposed or voted on moratoriums to temporarily halt new data centers as they consider limits on where, when and how the facilities can operate.
Looking Ahead
For Democrats, a millennial showdown in Michigan's high-stakes U.S. Senate race continues to develop. About 14% of respondents identified data centers or artificial intelligence as top concerns in Bridge Listens, an unscientific survey of election-year issues that candidates should address.
State Sen. Mallory McMorrow is the latest U.S. Senate candidate to endorse stricter labor, environmental and transparency requirements for data center projects, following earlier proposals from Abdul El-Sayed and Haley Stevens.
Both McMorrow's and El-Sayed's plans call for penalties for companies that don't adhere to ratepayer protections and environmental requirements or fail to deliver on job creation.
That means data center companies, not Michigan families, will pay for their own energy, grid upgrades for the benefit of all ratepayers; pay their fair share in taxes to fund our schools, roads, and communities; and pay our workers by creating good-paying union jobs, she said in a statement.
The Broader Context
As data centers continue to grow rapidly across Michigan and the nation, state and local officials are confronting serious unknowns about how these large facilities affect their communities. There may be better solutions out there than what we are currently doing – which is allowing data centers to be sited anywhere and everywhere without thinking through the long-term effects.
The data center debate represents a growing tension between economic development priorities and environmental and community concerns. As more states and municipalities consider moratoriums, the pressure is mounting on developers to address legitimate concerns about water use, energy consumption, and local impact.
Michigan's experience with data centers will likely inform policy decisions across the Midwest and beyond, as communities across the country grapple with the same challenges facing Michigan towns and cities.
This article was updated on April 1, 2026 to reflect the latest developments in Michigan's data center moratorium movement and Senate race.