Data centers are not the economic development miracle often described by boosters. Nor are data centers the threat to everything residents hold dear, as opponents often describe.
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In a Nutshell:
Data center development proposals should be evaluated on a case-by-case basis. While large ‘hyperscale’ facilities should be carefully scrutinized to mitigate potential negative impacts (power demand, water use, noise), many smaller more typical data centers are nearly indistinguishable from office buildings and provide valuable services to local businesses and other users of digital cloud services.
The economic benefits of data center investments are modest. The primary economic activity created by data centers is during the construction phase. Attracting data centers is not an effective approach to long-term economic development. However, local host communities may substantially benefit from property tax revenue and/or community benefit agreements.
The negative impacts of data centers are often overstated. While there is a risk of unsustainable development, Michigan’s water resources and power grid appear capable of accommodating substantial data center development under current policies. The most concerning negative impact of data centers is noise pollution. Protecting nearby residents from harmful impacts of data center noise is feasible but requires particular attention from local permitting agencies.
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