Michigan leaders hit “pause” on tax breaks for water-guzzling big tech data centers


The environmental community has achieved a major victory – although temporary – in convincing legislative leaders to press the “pause” button on a set of bills that would pose a significant threat to the Great Lakes.

Slated for a final vote in the House of Representatives on the last day of session before the summer recess on June 25, the bills sought to offer tax incentives to Big Tech companies such as Amazon, Microsoft, and Google to build new data centers in Michigan. But the bills did not adequately address the extraordinary energy and water needs of data centers and the threat to vital groundwater aquifer resources, and could potentially jeopardize Michigan’s ability to meet its new climate energy goals passed in November 2023.

Lawmakers and environmental organizations will work on the bills over the summer to see whether these concerns can be addressed.

“The Great Lakes are vital resources for all the communities that surround them,” said FLOW Executive Director Liz Kirkwood. “As we look to the future, citizens and policymakers must carefully consider the impact of high-volume energy and water consumption on this precious natural resource. We must ensure that the terms set for such consumption are clear and protective of the Great Lakes.”

One crucial consideration for Michigan is transitioning from traditional Rust Belt industries to more sustainable Blue Belt industries. Communities across the Great Lakes Basin recognize the economic potential of the Great Lakes, which comprise the third largest economy in the world. As we move forward, it’s important to champion and steward the Great Lakes, inviting industries that will prioritize the well-being of this invaluable natural resource.

Recognizing the obstacles encountered by Environmental Justice Communities (EJC), it is vital for legislators to actively engage these communities in the decision-making processes regarding the preservation and management of the Great Lakes. For example, we should leverage data center development in Michigan to help ensure safe and affordable water by requiring state-of-the-art water efficiency practices and utilizing existing capacity at municipal water systems. Further, priority must be given to community water systems devastated by reduced revenue caused by a shrinking base of ratepayers, while also ensuring that the data centers protect the health of residents in those communities. We should prioritize using existing municipal water infrastructure, rather than relying on extracting precious groundwater resources.

Environmental justice communities have a crucial role in influencing policy related to the Great Lakes. These communities have and must continue to voice their lived experience and knowledge to our lawmakers, and those lawmakers must respond constructively. By actively participating in the policymaking process, EJC can help ensure that the protection and preservation of the Great Lakes water system, as well as equity considerations, are included in any proposed legislation.

2 comments on “Michigan leaders hit “pause” on tax breaks for water-guzzling big tech data centers

  1. Joe Jak on

    Be sure to note many of these data centers are what is known as lights, which means little to onsite presence required. These datacenters can be run remotely from anywhere in the world. So I don’t think there is much incentive to bring jobs to Michigan. This will just cost us in the long run.

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