Michigan Lawmakers Propose Year-Long Data Center Moratorium Amid Rural Community Backlash

State Reps Seek Pause on Hyperscale Projects

A bipartisan group of Michigan lawmakers introduced legislation last week to place a one-year moratorium on data centers in the state. Three state House bills would prevent the Michigan Department of Environment, Great Lakes, and Energy and local governments from issuing permits or other needed approvals for data centers until April 1, 2027.

The legislative package would bar the Michigan Public Service Commission from approving agreements with data centers over the same period. A pause on data centers is needed to determine the best locations for the facilities and how the state will meet their massive power demands, according to State Rep. Jennifer Wortz who led efforts on the moratorium legislation.

Rural Communities Feel Invaded

Wortz said the bills are not intended to block data centers outright, but to create time for the state to develop legislation that holds data center companies accountable. Many rural communities just feel like they're being invaded, she said. Endless solar panels, wind farms, battery storage facilities, and now data centers are being proposed, often with little to no local input and oversight.

Data centers come with a lot of unique questions. Between the land being cleared for development, the demand for energy they will add to the grid, and the tremendous water usage, these projects could cost communities more than they're worth. I grew up on a farm, I own a farm, I'm a conservationist, and I understand the importance of proper land management. We can't continue to allow our farmground and natural resources to be mindlessly destroyed.

The proposed data center in Saline Township would use 1,400 megawatts of electricity. That is equal to the same amount needed to power 1 million homes, or the entire city of Detroit.

Economic Development vs. Community Protection

The Lansing Regional Chamber of Commerce, a supporter of the city's Deep Green data center project, opposes the proposed moratorium. Chamber President and CEO Tim Daman said Michigan should be positioned to attract data center investment, not delay it.

You have an industry that is growing, and with a lot of capital right now. And they're looking to invest now. And, so, I think as a state we need to be ready and poised to capitalize on some of this growth. This is another way for us as a state to try to be competitive with other states around the country.

A moratorium on data centers might as well be a moratorium on any future economic development and growth for our state. We are falling behind so far in so many areas, and at some point we have to unite and come together and figure out how we're going to move this state forward.

State Opposition Expected

State Rep. Wortz acknowledged the moratorium legislation is unlikely to succeed under the leadership of Michigan House Speaker Matt Hall and Gov. Gretchen Whitmer, a Democrat. Neither Hall nor Whitmer replied to requests for comment on House Bills 5594, 5595, and 5596.

Whitmer has opposed previous efforts to rein in data center developments. Whitmer spokesperson Stacey LaRouche told Michigan Advance in February: Any legislation that prevents us from growing the economy and creating jobs is an automatic non-starter and would be vetoed.

Local Opposition Growing

Several southeast Michigan communities have enacted data center moratoria in order to develop rules for the development of the facilities, including Howell Township, Sterling Heights, and Pontiac.

In Howell Township, developers of a proposed 1-billion data center withdrew their application in response to resident outcry after a moratorium was passed.

State Sens. Rosemary Bayer, Sue Shink and Erika Geiss introduced Senate Bills 761, 762, and 763 in December to bar data centers from withdrawing more than 2 million gallons of water a day for consumptive use that isn't returned to water systems, and to create transparency standards for the facilities' water and energy use. None of the bills have passed out of committee.

Also in December, Rep. Reggie Miller introduced HB 5399, which would bar public officials from signing nondisclosure agreements when discussing data centers. Rep. Miller's legislation has not passed out of committee.

The bills have been referred to the House Committee on Government Operations for consideration.

Expert Analysis

Erik Nordman, director of MSU's Institute of Public Utilities, said data center companies vary in their approach to energy sourcing, with some prioritizing renewable energy and others using any available source. He said a moratorium could benefit both companies and communities by creating a clear understanding of project goals and impact.

A year pause would give time for communities and the legislature to review some of these projects, and they would also be able to review the plans, the integrated resource plans that will be coming from the utilities to see what their plans are. How do they plan to integrate these new demands into their portfolios?

Community Advocates Push Forward

State Rep. Dylan Wegela, who sponsored one of the bills, said that in addition to environmental and ratepayer protections, a moratorium is needed to protect workers from data center-powered artificial intelligence, which he said could lead to job losses or worker surveillance.

Wegela acknowledged the moratorium legislation is unlikely to succeed under the leadership of Michigan House Speaker Matt Hall and Gov. Gretchen Whitmer.

Whitmer has opposed previous efforts to rein in data center developments. Whitmer spokesperson Stacey LaRouche told Michigan Advance in February: Any legislation that prevents us from growing the economy and creating jobs is an automatic non-starter and would be vetoed.