Data centers promise a boon for Wisconsin development

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Data centers are credited for buoying the general construction market as demand falls in other sectors and in Wisconsin has injected billions of dollars of investment and created thousands of construction jobs. The union construction sector has touted these massive facilities, used for housing computing equipment that run Internet and artificial intelligence services, for the work they provide now and in the future.

Recently, the conversation around data centers has changed since Microsoft’s announcement more than a year ago, with different reactions from construction unions, public officials, environmental groups, business experts and concerned residents.

There are 47 data centers in Wisconsin, according to Data Center Map, and some of them are housed in existing multi-tenant office buildings or mid-sized standalone structures. But Microsoft’s 2024 announcement for a $3.3 billion, 1.5 million-square-foot data center facility in Mount Pleasant opened the gate for massive server houses into the state.

It was part of former President Joe Biden’s effort to reshore American manufacturing and invest in technologies such as semiconductors and computer chips. It was also spurred by the advancement of artificial intelligence technology, popularized by companies such as OpenAI and Meta, which now plan to add gigawatts of computing power to the local grid.

Dale Lewis, director of data centers for Appleton-based Boldt, said the state’s proactive mentality toward attracting new businesses has drawn some of the data center growth.

The data center boom has also led to some scrutiny over how much electricity and waters data centers use. Lewis said many of the companies running the centers, as well as their contractors, are looking at ways to reduce their environmental impact and effects on electricity prices for ratepayers.

“One of the benefits of being in Wisconsin is it is a cooler weather climate,” Lewis said in an interview. “If you look at a one-year cycle, if we can run a cooling system without using chillers to cool the water that’s in the closed-loop system, and we can do it with just a radiator that sits outside; we call that free-cooling because we’re using the atmosphere to bring water temperatures down into a controllable rate. But on top of that, the state is very proactive from a business standpoint at attracting data center development.”

While more than half of contractors in November said they thought the industry was shrinking, the surging data center sector kept manufacturing construction up, said Anirban Basu, chief economist of the Associated Builders and Contractors in a news release. Around one in seven contractors at the time were under contract to work on data centers and had higher backlog as a result.

The Midwest and New York were well positioned for strong construction growth because of the conditions they have for megaprojects such as data centers and semiconductor plants, Basu said at a Construction Executive webinar.

Data center users have also announced commitment to workforce development, renewable energy and restoration programs in their respective parts of the state. Microsoft said it will partner with United Way, the University of Wisconsin and the Wisconsin Technical College System to train more than 100,000 people in AI. Meta and QTS Data Centers have partnered with Alliant Energy to create renewable energy to address electricity demand.

The megaprojects are also expected to bring ancillary development, created by a market sector with more money seen since the Industrial Revolution, Lewis added.

“If the industry continues to grow, you’ll see any supporting businesses that can interact with data center development also grow and flourish,” Lewis said. “Any kind of service provider, any kind of maintenance provider for any of these data center developments, security, manpower and the construction industry. All of them will benefit from this kind of development coming from the state. This is a market sector with more money than we’ve seen since the Industrial Revolution and being positioned to seize that opportunity is very important for the state of Wisconsin.

Here is a list of data center projects in Wisconsin.

QTS Data Centers

Virgina-based QTS Data Centers is advancing plans for a $12 billion data center campus in Dane County and planned to submit a zoning application to the village of DeForest in fall 2025. The developer announced it will provide a $50 million fund to support Madison Area Technical College and local institutions. The project also partners with local construction unions for labor and Alliant Energy to kickstart 750 megawatts of renewable energy.

Vantage Data Centers

The 672-acre campus will feature four data center buildings with 2.5 million square feet in Port Washington along Interstate 43. The $15 billion project is scheduled to be completed in 2028. The end users are OpenAI and Oracle, the minds behind artificial intelligence products such as ChatGPT. The companies in fall announced they would invest $500 billion in its “Stargate” program with data centers across the nation.

Meta

Meta has been revealed as the user behind a $1 billion, 500-acre data center campus in Beaver Dam. The project is expected to create more than 1,000 construction jobs and around 100 permanent jobs when completed in 2027. The tech giant said it wants the campus powered by 100% renewable energy and aims for a LEED Gold certification. Meta will also partner with Ducks Unlimited to restore 570 acres of local wetlands and prairie.

Microsoft

Microsoft has invested more than $7 billion since it announced its presence in Wisconsin in May 2024. That is split up between $3.3 billion for an initial phase in Mount Pleasant and another announcement for $4 billion to build more data center space focused on AI development. The first phase is expected to come online in early 2026 and the project created around 3,000 construction jobs. Using different LLCs, the company bought former farmland from local landowners and acres of land previously set aside for Foxconn Technology Group.

Viridian Partners

Viridian Partners is working with the city of Janesville to win approval for a data center complex at the former General Motors plant, a 250-acre site split into north and south parcels in the city’s south side. Plans call for an 800-megawatt, 11-building campus called the “Janesville Data Center” with an investment of around $8 billion. In November, the Janesville City Council approved a letter of intent with the developer for the redevelopment of the auto plant, Wisconsin Public Radio reported. The plant closed in 2008 and demolition was completed in 2019; it’s likely the property will need remediation and new power infrastructure.

Despite being a buoy for construction, some challenges persist for data center construction, such as the White House’s 50% targeted tariffs for copper and steel – the latter crucial for electronics. Contractors also face a significant shortage, finding experienced and skilled workers.

Another potential challenge is how data centers are seen in the public eye as residents in Port Washington and Beaver Dam raise questions about energy and water usage. A proposed 244-acre Microsoft data center in Caledonia was turned down after a public outcry. An environmental group filed a lawsuit to force the Public Service Commission of Wisconsin to share energy demand records for the data center campus being developed in Beaver Dam.

Adam Kelnhofer, freelance writer for The Daily Reporter, contributed to this report.