Michigan lawmakers recently approved major new subsidies for energy-hungry data centers after Democrats tied the incentives to clean energy requirements.
A pair of bills awaiting action from Democratic Gov. Gretchen Whitmer would exempt data centers from sales and use taxes through 2050, or 2065 if the centers are built on the site of a brownfield or a former power plant. Supporters say that if signed, the bills — HB 4906 and SB 237— will draw major investment to the state as tech companies expand artificial intelligence.
But the legislation has divided Democrats. The Democratic-controlled Legislature relied on Republican votes earlier this year to advance the bills, which received final passage last week during the lame-duck session. Republicans won control of the House during this year’s elections and will take power in January.
Opponents warn the legislation could tank the state’s climate goals if data centers — one of the largest sources of energy demand growth — lead utilities to extend the life of gas-fired power plants, as they have in other states.
