Wisconsin is a hotspot for data center developers; with recent proposals in localities like Port Washington, Kenosha & Janesville. The development of these centers has become a point of contention. Those who oppose the centers cite excessive water consumption, health concerns, noise pollution and general over-development. Supporters point out that America needs to remain competitive in the AI market, create industry, provide jobs and revitalize communities.
There are already data centers operating in Wisconsin and around the United States, in neighborhoods just like yours; so, what is the impact of AI data centers on the Wisconsin homeowner?
What is an AI Data Center?
Data centers are large warehouses housing servers and networking equipment that can store, process and analyze various data sources. An AI data center is one that has been specifically built to house AI servers. These centers are used for advancing and processing the AI world – which is only increasing in popularity and use.
1. Water Consumption
If you’ve heard about data center controversies – you’ve likely heard water usage mentioned. Running all the equipment and servers produces heat and to cool things off, these centers turn to electric fans or water. Water is often the cheaper and thus, more used option.
Altogether, the current data centers use billions of gallons of water annually, reported at 449 million gallons of water per day in 2021. With the number of data centers continuing to rise, this number has only increased.
But why is it a big deal? There’s plenty of freshwater – right? Well, no. There are plenty of well-documented cases of watersheds under stress from drought or overuse. In addition, ⅕ of current data centers are located in water-stressed regions. When you consider that one large data center could consume up to 5 million gallons per day, the drain on watersheds can be heavy. When watersheds are overtaxed, it can reduce water access to homeowners and other businesses.
Now, companies like Microsoft, Meta & Google are making promises to become water positive. To do this, they are turning more to closed-loop designs, “waterless options” and using recycled water sources.
2. Electrical Pricing
In order to run these AI data centers, they need electricity – a lot of it. In total, the electrical consumption for AI training and interface is projected to grow from 4.4% in 2023 to 6.7-12% in 2028. By 2030, it is estimated the US may consume more electricity for data processing than it does to manufacture all steel, aluminum, cement and other energy intensive goods combined.
The potential for increased electric pricing arises from demand outpacing supply. In addition, aging power grids have necessitated a rapid rush to modernize infrastructure, and these costs are, partially, passed onto residential customers. In fact, residential prices, according to federal data, increased 7.1% in 2025.
AI data centers are not the only reason behind increasing electric costs; other factors like fossil fuel prices and aging electric grids, have also caused increases. However, data centers have had an impact. A Bloomberg analysis discovered that areas with high concentrations of data centers saw electricity prices jump 267% over the past five years.
Some data centers are pledging to use renewable energy sources like solar or wind turbines. However, the reality of a data center being 100% run on renewable energy sources today, isn’t possible because of its sporadic nature. As long duration storage options become more available this may become a more viable solution for secondary power sources.
At this current moment – the promise of creating an environmentally friendly data center that doesn’t heavily impact the electrical grid or water consumption, is still largely theoretical.
3. Tax Benefits
A positive impact highlighted with the introduction of data centers is increase of tax revenue.
Many highlight Loudoun County, VA as an example of this benefit taking hold. This county has about 200 data centers – a market greater than the next 6 U.S. markets combined. According to reports, the introduction of these data centers has increased tax revenue by $890 M. As a result Loudoun County has the lowest real property tax in Northern Virginia – about 25% lower than neighboring counties.
Data centers also typically utilize less public services. In fact, according to JLL, for every $26 paid in taxes by data centers in Loudoun County, they only use $1 of public services – which is a better split than the $4 used by manufacturers.
The introduction of data centers to some of these communities has significantly increased the local tax base. Thus, increasing the revenue for these municipalities. This increase, alongside limited use of public services, is a potential benefit to their presence in a community.
4. Infrastructure Development & Job Growth
Another common benefit pushed by developers and advocates for data centers is these companies will bring along community benefits. Things like: short and long-term job growth, improvements to local infrastructure and economic activity that supports small local businesses.
A report done in 2017, done by the US Chamber of Commerce Technology Engagement Center, determined that a typical data center will employ around 1,700 local workers during the construction phase and then about 150 in the years following. Other reports are less favorable, suggesting just 20 to 50 long-term staff members.
Community involvement is a speaking point often used when a data center is looking to push forward a new development. It can be seen right now in Mount Pleasant, as Microsoft works to build their data center there.
Microsoft Community First Initiative
The Microsoft President, originally from Racine County, is pushing the community vibe – “We are now part of the ‘we’ in Mount Pleasant and Racine County,”. Pointing out that they would be investing in employment of the local community (their Fairwater Data Center is projected to bring about 800 to 900 permanent jobs) and involving itself with local non-profits.
They are also working with Gateway Technical College and other organizations to expand upon the workforce’s knowledge in Racine County. In this way, they are opening up the door for current members of the community to benefit from the new jobs.
Microsoft has championed a new initiative, called Community First. They are focusing on many of the pain points of bringing in a data center, including:
- Paying utility rates to cover their energy usage & investing in infrastructure upgrades to improve electrical services for other consumers
- Using a closed loop cooling system to help conserve water (estimated to use 2.8 million gallons per year)
- Creating long- & short-term employment through construction, which will be over 10 years, and then operations
- Not seeking tax breaks or abatements in Racine County, which will pay down TIFs faster
- Expanding access to AI training, digital literacy and support for non-profits in the Racine area
Community involvement and reinvestment is something that can be very beneficial. However, it is important for consumers to be vigilant when it comes to promises being made – to ensure that companies have a history of following through on their word.
5. Pollution
Homeowners living near data centers have documented complaints surrounding air & noise pollution.
Noise
The noise that emits from the center is often described as a buzzing. This comes from the diesel generators, cooling systems, and overall energy consumption.
A safe noise decibel is set at 70 dBA or lower, anything above 85 dBA could be harmful to hearing. The systems that keep the data centers operating produce between 55 and 85 dBA typically. For context, 60 sounds like background music, 75 sounds like a vacuum cleaner and 85 like a lawnmower.
The noise of a data center never really stops – which is the problem for residential neighbors. As they operate 24/7 – there is never a break in the noise. Ways to combat noise pollution can be done through sound proofing and liquid cooling over fans.
Air
Air pollutants are linked to adverse health outcomes. They are particularly bad for the older & younger populations and those with pre-existing conditions. Ones that cause serious health effects are sulfur dioxide and nitrogen dioxide.
Also, pollutants can travel distances, impacting locations far beyond a physical footprint.
The current back-up power, diesel generators, are known to create significant amounts of air pollutants and even hazardous emissions during operation. As back-up generators, they are not running all the time. However, recent changes to policy have made it so centers could run diesel generators during non-emergency use for up to 50 hours a year – provided certain criteria are met.
. . .
The truth is that data centers have become an intertwined part of daily life, even beyond AI usage. Data centers are powering everything from cloud computing, artificial intelligence, and email. It’s something that has evolved into a part of the current tech landscape.
It is clear that regulation, transparency, and renewable energy development is key, to ensure that data center development is a net positive for the communities they are entering.
As these data centers continue to expand, perhaps into your community, there are things community members should be asking. . .
- Will this increase my electricity costs short and long term?
- What is the estimated increase in noise associated with the data center and what plans are in place to mitigate it?
- How much energy will the data center use at its peak?
- What are the sources of electricity?
- Does the data center draw power from the main grid, or will it have its own energy source?
- Will additional power infrastructure (such as new power plants or transmission lines) be required to deliver the electricity?
- What cooling systems will be used by the data center?
- How much water will the data center use at its peak?
- What will be the source of water at the data center?
- If the data center uses diesel backup generators, what type are they?
- How often will NOx, SO2, and fine particulate emissions be measured on site, and will the results be reported publicly?
