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Nearly 1,500 square miles of the Great Lakes State — an area about the size of Rhode Island — are temporarily off-limits to data centers, warehouses full of servers for cloud computing and artificial intelligence.
That’s according to an MLive tally of 51 cities and townships that have passed data center moratoriums, measures that temporarily pause the consideration or construction of new projects within their boundaries.
The total is almost surely an undercount. More could soon join the list. The city council in Detroit, the state’s largest city, called on its mayor to enact a two-year data center pause in March.
Planning experts say the trend reflects how local townships and cities across the Mitten are struggling with how a new generation of “hyperscale” data centers demanding massive amounts of power and water can coexist with their neighbors.
In the absence of statewide rules, township boards and city councils are in the driver’s seat in deciding where these billion-dollar facilities, used by the likes of Microsoft, Amazon and Google, could be built.
“They’re all kind of grappling with this at the same time, and so as attention around data centers grows, it’s going to be natural that there would be more moratoriums,” said Sarah Mills, a planning professor and director of the University of Michigan’s Center for EmPowering Communities.
The long-term impact of the development pauses is still coming into focus, as communities use the time to craft new local restrictions on data centers governing where and how they operate. A moratorium is not the same as a ban.
But they’ve still become a rallying cry for residents who oppose the projects, fearing they could bring unpleasant noise, air pollution or unsustainable demand on Michigan’s power grid.
Meanwhile, boosters representing the fast-moving tech firms say communities hitting the brakes could be taking themselves out of the running for new jobs and millions in tax revenue.
“If you have a moratorium in place, it is a signal to the industry that this might not be the best place to make a multibillion-dollar investment,” said Brad Tietz, director of state policy for the Data Center Coalition, a trade group.
“Capital is being deployed as we speak, and investment decisions are being made every day. So obviously, the longer these moratoriums are in place, the less chance these communities have to attract this investment,” he said.
Communities hit pause to get ‘breathing room’ amid AI boom
Outside Bay City, a township supervisor said it was about “respecting the wishes of our residents.” Near Jackson, another official proclaimed it gave his township “time to cross their T’s and dot their I’s.” Close to Ann Arbor, yet another spoke of “breathing room.”
Many communities in Michigan, from Metro Detroit to the U.P., view data center moratoriums as a chance to slow down and get ready for a new kind of development bursting onto the scene.
In many cases, local zoning rules drafted 20 or more years ago didn’t anticipate the kinds of facilities that are currently fueling an AI boom across America, some demanding as much power as hundreds of thousands of homes and looming larger than a Walmart Supercenter.
“If your zoning ordinance is that old, and there are a lot of them out there, they wouldn’t have contemplated a 2-million-square-foot data center,” said Michael Homier, a municipal attorney with Foster Swift Collins & Smith.
In other cases, local rules might name data centers but envision the smaller variety that has existed in Michigan since the advent of the Internet, according to Mills, the UM planning professor, whose center has authored a data center guidebook for local governments.
In that case, municipal rules might allow data centers in areas designated for offices, when an industrial classification might be more appropriate for the new, large-scale facilities, she said. “That is a very clear place where having a moratorium may make a lot of sense.”
In passing a temporary pause, local officials are often saying they need time to reassess local rules, addressing potential nuisances like noise from diesel backup generators or cooling systems that can suck up millions of gallons of water.
MLive identified moratoriums lasting from 90 days to two years now in place in Michigan.
Some, like that passed by Livingston County’s Howell Township, came as local officials stared down a large-scale project, reportedly for Facebook and Instagram owner Meta and now withdrawn.
In Lowell Township, a rural community near Grand Rapids, residents have packed township meetings demanding a moratorium as Microsoft eyes their community for development. One is now under consideration.
In other cases, the pauses were voted through preemptively.
In Washtenaw County, 14 communities have passed them, most in the aftermath of the approval of a massive data center for ChatGPT creator OpenAI and tech giant Oracle in Saline Township, now under construction just a short drive from their boundaries.
And far away in northern Michigan, worries that an old nuclear plant site could attract data center developers motivated a development freeze.
Can Michigan towns ban data centers?
Could a Michigan community go a step further and fully prohibit large-scale data centers? Now, it’s really time to bring in the lawyers.
“This is a really tricky area, because it’s not just a simple yes or no answer,” said Michael Selden, director of member information services with Michigan Townships Association, in a written response to questions from MLive.
Generally, Selden and other planning experts said, local governments can’t practice “exclusionary” zoning, where they completely prohibit a certain kind of land use.
But it’s possible that after a full review, a township could determine that a data center can’t work within its boundaries if it can show a good reason for the exclusion, Selden said.
Doing so could attract legal challenges, and Michigan law prohibits this kind of ban when there is a “demonstrated need” for a certain kind of project.
It may be a hard case to make when it comes to data centers, given their role in supporting commonplace cloud computing technology and existing state and federal incentives for the projects, said Mills.
But Homier said it’s unclear how that need would be quantified, and arguments would hinge on the local specifics.
“Let’s suppose you have a township, and around that township there are five other data centers that are under construction or completed. Is there a demonstrated need for a sixth in that additional township? That would be the question,” he said.
Michigan saw many legal disputes that followed a similar pattern decades ago around mobile home parks, which some communities wanted to prohibit. The same arguments haven’t yet played out in court around data centers, Homier said.
But zoning dustups and restrictive rules have resulted in local governments losing control of other kinds of development, like cell phone towers, electric transmission lines and solar farms, according to Mills. So far, data centers have not followed suit.
Are data center moratoriums slowing Big Tech down?
Michigan is early in its foray into hosting large-scale data centers, lured by tax breaks lawmakers passed for the projects in 2024.
Will local moratoriums slow things down? It depends on who you ask.
“I think that we’re already seeing the early cusping stages of a chilling effect,” said Marjorie Steele, founder and executive director of the Economic Development Responsibility Alliance of Michigan, which has been critical of data center expansion. “I absolutely think that the industry is taking note of this.”
Steele, an activist who launched the group in opposition to the now-defunct Gotion Inc. EV battery plant project near Big Rapids, cited projects that were withdrawn after local opposition, like a $120 million data center proposal in downtown Lansing. The city may now consider a moratorium.
Steele supports the local pauses and calls for a statewide moratorium.
A small bipartisan group of lawmakers have introduced legislation to pause construction of new data centers across Michigan until 2027. But along with other bills limiting data centers, it has gone nowhere in Lansing.
And others aren’t so sure that moratoriums are discouraging data center projects.
Michigan has more than 1,300 jurisdictions with zoning power, Mills said, meaning much of the state is still relatively wide open for development.
The 1,466 square miles encompassing the communities MLive identified with a current moratorium account for just 2.5% of the state’s land mass.
Tietz, with the Data Center Coalition, said the industry hopes to “strike a balance” between its needs and what works for communities as many in Michigan establish local regulations.
Even as that takes place, Mills isn’t certain Michigan will ultimately host many large-scale data centers, since they are limited by where they can secure commitments for large amounts of electricity.
The state’s largest utilities, DTE Energy and Consumers Energy, have trumpeted the potential to serve big data centers to their investors. DTE’s CEO said in February that local moratoriums had “no impact” on the pipeline of projects it may serve.
But, so far, only two projects, the OpenAI and Oracle data center in Saline Township and a potential Google data center in Wayne County’s Van Buren Township, have gone to state regulators for approval of power contracts.
Only the Saline Township data center is currently under construction.
Even so, with proposals surfacing across the state over the past year, some believe it’s important for locals to get ready by drafting zoning rules that are appropriate for their communities.
“The truth is that the vast majority of Michigan’s townships are not ready for any major development project, let alone data centers,” Steele said.
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