Tech Giants Unveil $7B Data Center, Michigan’s First Hyperscale Campus
Three major tech companies, OpenAI, Oracle, and Related Digital, are set to transform Michigan’s landscape with a groundbreaking data center project. This initiative, named Stargate, will represent the state’s first hyperscale data center, located in Saline Township. The project will demand over 1 gigawatt of power and is projected to exceed $7 billion in value.
Details of the Project
Construction of the Saline Township data center is expected to commence in 2026. According to DTE Energy, the utility provider for the area, a recent agreement will supply 1.4 gigawatts of power to support this ambitious facility. The complex will be constructed on a 575-acre site, with approximately 250 acres dedicated to three buildings, each expanding 550,000 square feet.
Economic Impact and Job Creation
Governor Gretchen Whitmer emphasized the economic potential of this project, highlighting it as the largest economic initiative in Michigan’s history. The development is anticipated to generate more than 450 direct jobs, along with additional employment opportunities in Washtenaw County.
- Investment Value: Over $7 billion
- Power Demand: More than 1 gigawatt
- Job Creation: 450 onsite jobs
Community and Environmental Considerations
The announcement, however, has not been without controversy. Initially, the Saline Township board opposed the project, citing concerns around zoning and environmental impact. Nonetheless, Related Digital successfully pursued legal action against the township, advocating for the development. Following a settlement, the township’s attitude shifted as developers agreed to invest approximately $14 million in local community projects, which included facilitating groundwater monitoring.
While some local officials are now supportive, the project has prompted debate among residents regarding the potential energy strain and environmental implications, particularly considering climate goals. Proponents argue that the data center will contribute valuable economic growth, while opponents fear its impact on local resources.
Utility Infrastructure and Future Plans
DTE is navigating changes to its grid to accommodate this new demand, which represents a significant increase in energy consumption—potentially by 25%. This incorporation aligns with broader negotiations with various companies for additional demand of more than 3 gigawatts. Furthermore, Consumers Energy is reportedly finalizing agreements for several data centers that would total approximately 2 gigawatts, adding to the growing interest in Michigan.
Legislative Support and Challenges
The Michigan Legislature has enacted new tax incentives to attract tech giants to build data centers, allowing them exemptions from the 6% state sales tax. However, local taxes can still impose significant costs. Despite these incentives, some lawmakers express reservations about the long-term viability and community impact of such developments.
The advent of the hyperscale data center signifies a pivotal moment for Michigan. As the tech landscape evolves, the Stargate project not only promises to reshape local economies but also to position Michigan as a key player in the burgeoning field of AI infrastructure.
