Technology companies are pursuing projects that would launch data centers into space — efforts called Starcloud at Elon Musk’s SpaceX and Project Suncatcher at Google.
According to reporting from the Wall Street Journal, the idea is that, instead of consuming land, power and water on Earth, the orbiting data centers would harness the sun’s energy for unlimited power.
The projects are in the early stages of development, according to reporting from National Public Radio, and viability remains in question over the cost of launching servers into space, where the heat from the servers will go, and the logistics of maintaining and upgrading the technology.
While data centers in space are unlikely to happen in the next few years, studies, including one from Southern New Hampshire University, conclude space-based data centers could be a reality in the next decade.
This fact brief is responsive to conversations such as this one.
For six months now, Wisconsin Watch has made a concerted effort to report on data centers. We’re publishing major stories at WisconsinWatch.org and, each Monday, we provide data center news nuggets in our Forward newsletter (subscribe here).
Here’s a month-by-month summary of what we’ve reported.
January: Wisconsin Watch revealed that officials in at least four Wisconsin communities (the number has since grown) signed nondisclosure agreements that hid details of billion-dollar data center proposals from the public.
February: We detailed how a $1 billion data center is being proposed for Grant County in the Driftless Area of southwest Wisconsin.
March: In a sign of the impact of artificial intelligence data centers, we reported that just three Wisconsin companies have done more than $1 billion in business supplying the facilities. We also disclosed more NDAs and other ways local governments have tried to keep data center details secret.
April: We were the first to report on an official estimate that state government will forgo $2 billion in revenue because of a sales tax exemption for data centers that was adopted in 2023.
June: We spent months gathering behind-the-scenes details on what happened to the Driftless Area proposal.
July: We detailed how land sales for the data center under construction in Port Washington turned homeowners and farmers into millionaires and, in some cases, created generation-changing wealth.
Wisconsin state government is not spending $2 billion on data centers.
The campaign website of Democratic gubernatorial candidate Francesca Hong stated that Wisconsin is “spending over $2 billion in public money” on data centers “this year.”
The article made clear that the $2 billion is forgone revenue, not an expenditure. The LFB estimated the state will forgo $2 billion in revenue over a period of years because data centers are exempt from paying state sales tax.
It’s unclear whether the three artificial intelligence data centers under construction in Wisconsin would have been built without the tax incentive, which most states offer.
Some states are rolling back the exemptions or imposing requirements for receiving them.
Texas’ Republican governor has called for elimination; Ohio’s GOP governor and Arizona’s 2027 budget paused exemptions.
This fact brief is responsive to conversations such as this one.
Wisconsin needs a comprehensive energy plan. State Capitol and renewable energy collage by Henry Redman. (Photos by Baylor Spears and Marga Buschbell-Steeger/Getty)
In a recent guest column, I argued that Wisconsin’s clean energy future is about affordability, jobs, manufacturing and economic competitiveness.
The next question is equally important:
How should we build that future?
Not one regulatory docket at a time.
Wisconsin stands at one of the most consequential energy crossroads in its history. Artificial intelligence, advanced manufacturing and electrification are driving electricity demand faster than anyone anticipated. The Public Service Commission’s draft Strategic Energy Assessment projects peak demand could increase by more than 40 percent by 2032, with more than 70 percent of that growth tied to just three proposed hyperscale data centers.
Those investments present tremendous economic opportunities. They also require smarter planning.
Today, the PSC is evaluating the Foundry Ridge and Red Oak Ridge methane gas plants alongside transmission projects, data center tariffs, utility investments, and other major infrastructure. Each proceeding examines a single project. None asks the broader question:
Taken together, are these investments the lowest-cost, lowest-risk path to Wisconsin’s energy future?
Without comprehensive resource planning, regulators have little opportunity to compare alternatives before committing customers to decades of infrastructure costs.
Affordable electricity is economic development.
The decisions made today will determine what Wisconsin families, businesses, manufacturers, and farmers pay for electricity for decades. They will also affect water resources, public health, and our state’s long-term competitiveness.
This is not an argument against growth. Wisconsin will continue to attract investment in advanced manufacturing, artificial intelligence, and data centers. The question is not whether growth occurs, but whether it is planned responsibly so that large energy users pay the costs they create rather than shifting risks onto everyone else.
Planning should begin by comparing complete portfolios of resources instead of evaluating projects in isolation.
Before approving new methane gas plants, regulators should determine whether expanded battery storage, demand response, distributed energy resources, energy efficiency, and additional wind and solar generation can provide the same reliability at lower long-term cost and lower financial risk.
The cleanest megawatt is often the one that never has to be generated.
Demand response is infrastructure. Every megawatt shifted away from peak demand reduces pressure on the grid and can delay or eliminate the need for costly new power plants. Large customers, including data centers, have enormous opportunities to shift demand through operational flexibility and advanced controls.
Battery storage also deserves greater attention. Increasingly, it competes directly with natural gas by providing reliability during periods of peak demand while avoiding decades of fuel costs and emissions.
Water belongs in this conversation as well.
Both data centers and methane gas plants can require substantial water for cooling. The proposed Red Oak Ridge facility alone could consume hundreds of thousands of gallons each day. In rural Wisconsin, where farms, private wells, trout streams, wetlands, and local economies depend on reliable water supplies, those impacts deserve careful scrutiny before permits are approved.
Natural gas will likely remain part of Wisconsin’s energy mix during the transition. But every new gas plant also commits customers to decades of fuel-price risk driven by commodity markets, pipeline constraints, extreme weather, LNG exports, and geopolitical uncertainty. Clean energy resources, by contrast, have no fuel costs and are often the lowest-cost, fastest-to-deploy options available.
Reliability and clean energy are not competing goals.
Modern planning can deliver both.
Wisconsin should also modernize its regulatory framework by evaluating the cumulative impacts of related infrastructure investments. Generation, transmission, data centers, water use, and utility planning are interconnected. They should be planned together, not approved one docket at a time.
Wisconsin has everything it needs to lead: world-class manufacturers, innovative businesses, skilled workers, abundant renewable resources, productive farmland, and a clean energy economy that already employs more than 75,000 people.
Wisconsin does not have an electricity shortage.
It has a planning challenge.
Planning reduces costs. It improves reliability. It protects water resources. It strengthens economic competitiveness.
Most importantly, it allows Wisconsin to build an energy system designed for 2050, rather than one modeled in 1990.
Instead of approving Wisconsin’s energy future one docket at a time, let’s build it through one comprehensive plan.
A 2023-25 budget provision granting a sales tax exemption to data centers was passed by the Republican-controlled Legislature and signed by Democratic Gov. Tony Evers in July 2023.
The Legislative Fiscal Bureau said in March that the tax break will cost the state more than $2 billion in sales tax revenue, mostly from massive data centers in Beaver Dam, Port Washington and Mount Pleasant. When the budget was approved in July 2023, hyperscale data centers were so new the fiscal bureau didn’t estimate how much an exemption would affect state tax collections.
While the high cost has drawn scrutiny, the incentive was originally designed to drive economic growth. According to the National Conference of State Legislatures, 38 states offer tax incentives on data centers.
Wisconsin has about 50 data centers, largely in the Milwaukee and Madison areas.
This fact brief is responsive to conversations such as this one.
A major national credit rating agency downgraded Oracle’s rating last week, citing uncertainty about the tech giant’s investments in artificial intelligence. The drop comes just weeks after the company sued Wisconsin’s utility regulator over new credit requirements for data center operators in We Energies territory — a lawsuit spotlighting the company’s financial condition.
S&P Global Ratings, one of the “big three” ratings agencies responsible for assessing the creditworthiness of government and corporate debt, lowered Oracle’s rating from a BBB to a BBB- on July 9. The rating places Oracle on the bottom edge of S&P’s “investment-grade” tier; any additional downgrades will land the company’s credit rating in the “high yield” or “junk” tier.
“Oracle Corp.’s rapidly expanding AI infrastructure business is increasing its overall credit risk,” S&P analysts wrote in an announcement of the downgrade, pointing to high capital spending, “an uncertain path to profitability” and stiff competition as reasons to be “more cautious” in its approach to AI infrastructure businesses.
Still, S&P isn’t wholly pessimistic about Oracle’s finances.
“Despite the stretched leverage and cash-flow profile over the next two years, we expect Oracle to demonstrate consistent improvements toward profitability as capacity comes online and business scales,” the analysts added.
Oracle is co-developing a vast new data center campus in Ozaukee County, and its BBB- credit rating adds a hurdle to its efforts to connect the campus’ servers to the grid.
The reason: new rules for data centers seeking electrical service in We Energies territory. Wisconsin’s Public Service Commission (PSC) recently approved a rate structure for We Energies’ “very large customers” that requires operators like Oracle to pay for the construction of new power plants needed to meet data center energy needs.
But constructing a new plant can cost hundreds of millions of dollars, and any unpaid debts tied to the plants could fall to We Energies’ other customers if a data center operator becomes insolvent.
To shield ratepayers from a potential cost shift, the PSC set a AAA- credit rating threshold for data center operators seeking electric service from We Energies. Companies below the threshold must post steep collateral, either in cash or lines of credit, as a backstop.
For Oracle, that could mean paying $100 million or more a year as a condition of receiving electric service for Port Washington servers.
“In practical terms, tens of billions of dollars in Oracle’s value would need to be destroyed before creditors or counterparties, such as Wisconsin Electric and its other customers, could experience losses,” the utility’s lawyers wrote.
Oracle sued the commission in Ozaukee County Circuit Court as a backup to the reopener request. The company’s lawsuit asks Judge Sandy Williams to “set aside, reverse, and remand” the credit rating requirements, arguing that they aren’t “needed to prevent harm” to We Energies’ other customers or shareholders.
In a response filed July 9, the commission accused Oracle of trying to dodge regulatory scrutiny. The company seeks “to overturn over one-hundred years of established caselaw and allow it to dictate one-off preferential terms of service with the utility, bypassing Commission oversight altogether,” commission attorneys wrote.
Wisconsin’s Citizens Utility Board (CUB) and renewable energy advocacy group Clean Wisconsin also weighed in this week to support the credit ratings requirements.
“An investment grade credit rating provides little advance warning of financial difficulties that may worsen rapidly,” CUB attorney Daniel Narvey wrote in a position statement filed Monday in Ozaukee County Circuit Court. “If a data center customer suffered financial distress and had not been required to post collateral, (We Energies) and its other customers could be on the hook for billions of dollars of stranded investments.”
Oracle’s stock value has tumbled by more than 25% in the month since it sued the PSC.
Wisconsin isn’t the only state embroiled in a fight over Oracle’s data center operations. In March, Michigan’s Public Service Commission declined to revisit its approval of an electrical service agreement between utility DTE Energy, Oracle and OpenAI. Michigan’s utility regulator approved the contracts in an expedited, uncontested process that drew criticism from ratepayer advocates and Michigan Attorney General Dana Nessel.
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Wisconsin’s largest transmission utility is seeking federal intervention months after the Midwest’s regional grid operator awarded a major project to a startup competitor.
The American Transmission Company (ATC), which owns and operates transmission lines across eastern and central Wisconsin, asked the Federal Energy Regulatory Commission (FERC) last month to force the grid operator to either redo its bidding process or reconsider earlier bids.
The request escalates a protracted fight over who profits from billions of dollars in new transmission investments — costs that electricity customers pay through their utility bills — and whether competitive bidding limits those costs. The race to serve energy-hungry data centers has raised the stakes, and ATC’s request is intertwined with plans to connect a massive data center campus in Port Washington to the grid by the end of next year.
The fight to build transmission lines
Wisconsin’s latest high-capacity transmission buildout began in 2022, when the nonprofit Midcontinent Independent Systems Operator (MISO) approved $10 billion in upgrades across the Upper Midwest. Another round of approvals in 2024 brought the total projected price tag to roughly $32 billion. The upgrades are a core part of MISO’s effort to improve grid reliability and connect population centers to abundant electricity from renewable sources, especially from wind farms on the Great Plains.
Included in the buildout are a set of transmission lines and substations circling Milwaukee, stretching south to the Illinois border and north to Fond du Lac and Sheboygan. MISO originally expected the projects to enter service by 2033.
Decade-old federal rules require competitive bidding for multistate transmission projects, and utilities and developers from around the country lined up to compete for a share of the Midwest’s buildout. The winners gain a reliable source of revenue via a fixed “return on equity” — profit per dollar invested — approved by regulators and paid for by electricity customers.
Supporters of the bidding requirement, including Wisconsin’s Citizens Utility Board, say it forces developers to compete on cost, thereby shielding ratepayers from cost overruns and excessive profits.
But investor-owned monopoly utilities have spent years seeking exemptions from competition, contending that the requirement hinders efficient grid development.
Those lobbying efforts have paid dividends elsewhere in the Midwest: Minnesota and Michigan, for instance, enacted right-of-first-refusal (ROFR) laws giving local utilities first dibs on any transmission projects within their territory, including those planned by grid operators like MISO.
Utilities argue ROFR laws ensure projects go to the companies best-equipped to complete them: local monopolies with well-established relationships with local labor and regulators. The companies also argue that claims of cost savings from competitive bidding are overblown.
With no Wisconsin law shielding it from competition, ATC has sought other means to control projects in its territory.
Two months after bidding on the eastern Wisconsin project last July, ATC asked the state Public Service Commission (PSC) for permission to build infrastructure for a planned data center campus in Ozaukee County. Port Washington’s city council approved the campus shortly after MISO signed off on the nearby transmission upgrades.
ATC, which manages the existing local transmission infrastructure, is responsible for ensuring the campus connects to the grid by December 2027. Three of the substations ATC proposed to state regulators would occupy roughly the same locations as MISO’s planned substations, though the data center would require higher-capacity infrastructure on a shorter timeline.
Winning the larger project would allow ATC to meet both needs with one set of substations, but if MISO chose another bidder, the utility said it would still seek state permission to build substations for the data center.
Instead, MISO initially awarded the project to Chicago-based Viridon, a startup owned by private equity firm Blackstone. Viridon’s roughly $350 million bid was the lowest — just over half of MISO’s estimate and more than $100 million below the next-cheapest bid. In its January announcement, MISO acknowledged the budget “may not be achievable” but cited Viridon’s promises to limit cost overruns and profits as reasons to pick the company over its competitors.
ATC pressed the issue. MISO agreed in February to move up the eastern Wisconsin project deadline to 2027. A month later, the operator reassigned the three substations to ATC outright, citing uncertainty over whether Viridon could clear the administrative hurdles in time to meet the new deadline.
Viridon kept only a fraction of the original eastern Wisconsin project, including a set of transmission lines and one substation, all still scheduled for completion by 2033.
ATC appeals to Washington
As ATC awaits PSC’s final approval of the eastern Wisconsin buildout, the utility has opened a new front in its fight against competition by asking FERC to step in.
In April, a group of utilities calling themselves the “Grid Acceleration Coalition” asked FERC to exempt at least some major grid upgrade projects from the competitive bidding requirement. The coalition argued that “bureaucratic red tape” can tack months onto project timelines and strain the country’s ability to “achieve dominance” in artificial intelligence. ATC is a member of the coalition, as is Xcel Energy, owner of Northern States Power Company-Wisconsin.
“This complaint is about whether our country will seize, or squander, a generational chance to own the next century,” the utilities wrote, pointing to the tug-of-war over MISO’s eastern Wisconsin project as an example of delays that could stymie AI development.
FERC has been flooded with similar requests as the nationwide data center boom strains grid capacity and spurs utilities to spend billions of dollars on new infrastructure. The fragmented U.S. energy system is poorly equipped to manage the scale of the buildout, and the five-person commission has begun weighing in on questions about speeding grid connections and shielding residential ratepayers from data-center-related costs.
The Grid Acceleration Coalition’s April request specified that it did not seek to “claw back” projects already awarded via competitive bidding.
ATC’s June complaint goes further. The utility asked FERC last month to either “re-bid” or “reevaluate the existing bids” for MISO’s eastern Wisconsin project, arguing the grid operator botched its earlier review. If FERC agrees, Viridon could lose its remaining portions of the project.
Tom Content of the Citizens Utility Board told Wisconsin Watch that CUB will “support a full evaluation of the process and any concerns,” but said the timing of ATC’s request — months after MISO first awarded the project — was a surprise.
ATC said it brought the issue to FERC rather than appealing to MISO because the commission offers a more neutral venue. The company said it does not know when FERC will decide whether to take up the request. It remains unclear whether ATC’s effort to reopen bidding would delay construction of the substations needed to plug in the Port Washington data center to the grid.
Correction: A previous version of the story incorrectly described the remedy American Transmission Company is seeking in its petition to the Federal Energy Regulatory Commission.
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Whether artificial intelligence data centers are essential to modern life, an existential threat or something in between, one impact is clear:
As they pave over homes and farmland, they are minting millionaires — and even generation-changing wealth.
In Wisconsin, the clearest example is in Port Washington, a city of 13,000 north of Milwaukee where a 672-acre data center is under construction.
Some land deals were eye-popping, according to public records analyzed by Wisconsin Watch:
Members of the Karrels family and their family farming business earned at least $20 million. The largest sale was $10.2 million for 173 acres, or $59,000 per acre, 17 times the fair market value of $590,000.
Members of the Schlenvogt family, which has a long history in local government, sold properties for well above fair market value. Bonnie Schlenvogt sold her Lake Drive home and 65 acres for $3.44 million, nearly eight times the fair market value of $437,000. Her daughter-in-law, former Town of Port Washington Clerk Jennifer Schlenvogt, sold her nearly 3,000-square-foot Lake Drive home for $1.87 million, more than four times the fair market value.
A couple in their 60s, Peter and Ellie Burmesch, sold their 2,000-square-foot Tudor Revival on five acres for $2.13 million — seven times the estimated fair market value.
An adult group home with a fair market value of $320,700 sold for $6.5 million. Part of the deal involves relocating the facility.
Those sellers declined to comment.
Mayor Ted Neitzke, the data center’s most prominent supporter, said sellers fear being targeted by facility opponents.
“There’s a vocal minority that’s decided it needs to be louder,” he said. “That’s uncomfortable for (sellers) and they’re just not going to engage in it.”
Neitzke said the sellers are humble and not looking for publicity.
“They woke up one day and they just happened to live in the right spot.”
Port different from other data centers
Nationally, data center developers are willing to overpay for land near electric power and to beat competitors in what has turned into a land rush.
In Wisconsin, besides the Vantage-Oracle-Open AI $15 billion project in Port Washington, Microsoft is building a $20 billion data center in Mount Pleasant and Meta is building a $1 billion facility in Beaver Dam.
In Mount Pleasant, 25 miles south of Milwaukee in Racine County, most of the land had already been purchased by the village for a project launched by Foxconn that never fully developed. Racine County property sales records suggest Microsoft spent roughly $260 million on land alone.
In Beaver Dam, 40 miles northeast of Madison in Dodge County, the data center is located on 520 acres that were previously part of the Alliant Energy Commerce Park. Meta paid roughly at least $10.4 million for the land. Dodge County property sale records indicate that the tech giant purchased at least another 226 acres in Beaver Dam and neighboring Trenton from private landowners.
In Port Washington, on Lake Michigan’s shore in Ozaukee County, developers made big purchases from individuals. County property sale records show developers spent at least $125 million acquiring 1,500 acres of land or more.
Unhappy sellers
Curtiss Smith looks on at the property of his former home where the Vantage AI data center is now being built in Port Washington, May 21, 2026. (Trisha Young / Wisconsin Watch)
The windfall might have been welcomed by some sellers in Port Washington, but not others.
Ryan Nowak sold his 65-acre Lake Drive property for $1.75 million — over $1.3 million more than fair market value. But now, living on a 1.5-acre property about 10 miles north of Port Washington, he regrets it.
Nowak recalled that, before hiring an attorney, he signed documents that he said prevented him from discussing sale offers with his neighbors.
“On paper it looked OK, until you go to replace what you had,” Nowak said. “I don’t even have a fraction of what I had and it’s not like I have a ton more money left over or anything. I don’t know. I upgraded. What I have now is nicer, but it’s a fraction of the size of a property and buildings and everything else.”
Curtiss Smith also said there are misconceptions about his new wealth.
“People that weren’t part of it, they’re like, ‘Oh, now you’re a millionaire,’” he said. “Far from it.”
Smith, a 53-year-old crane operator, remembers the developer’s agent telling him his property would sell for three times the value of his four-acre property.
Sure enough, the property with a fair market value of $258,000 sold last August for $895,000.
The transaction left Smith appreciative but, having negotiated the deal alone, feeling some of his neighbors did better.
“After the fact, you hear what everybody else got,” he said. “You’re like, what the heck? Why did I sign so early, you know?”
Smith said the data center would have practically been in his backyard had he not sold. But, having bought a farmhouse a mile away, he still sees the data center every day.
Residents like Amanda Mueller — who live near the data center, but not close enough to get a purchase offer — are unhappy, too. They worry whether the project will cause environmental problems and bleed their property values.
“For all the people that moved here, for the tranquil beauty, the silence,” Mueller lamented. “It just seems so absurd now to look back at it and go, ‘Oh, God, if only we had a crystal ball. If only we knew.’
“I don’t think this town is ready for the culture change that’s going to happen,” she said. “So we’re looking at the future that’s really uncertain. And unfortunately, we’re trapped in the shadow of this thing.”
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Attendees at a Feb. 12 protest called for a pause on data center construction in Wisconsin. (Henry Redman | Wisconsin Examiner)
A pair of environmental groups filed a lawsuit Friday in Ozaukee County Circuit Court alleging that the Wisconsin Department of Natural Resources skipped a required environmental review process at the request of the company that is building a massive data center in Port Washington.
The lawsuit, filed by Midwest Environmental Advocates on behalf of the Sierra Club, alleges that the DNR backed off from requiring an environmental impact statement after the company, Vantage, said it would “kill the project.”
Communications between data center representatives and DNR staff, obtained by the groups through open records requests, showed Vantage complaining about the EIS requirement. The DNR ultimately conducted a more limited environmental analysis summary.
Vantage, Oracle and OpenAI are currently constructing a $15 billion hyperscale data center in the community. The data center will cover 672 acres and in its first phase require 1.3 gigawatts of power.
In the lawsuit, the groups argue that by not conducting the full environmental impact statement, the DNR ignored the potential impacts of the construction and operation of the massive data center on the local wetlands, water supply, air quality and energy demand. The lawsuit states that failing to conduct the full review before granting permits for the data center violates Wisconsin’s Environmental Policy Act. “The Port Washington data center is unlike anything Wisconsin has seen before,” Elizabeth Ward, director of the Sierra Club’s Wisconsin chapter, said. “It will completely transform the local landscape, consume staggering amounts of electricity and water and significantly increase fossil fuel emissions. At a time when scientists warn that greenhouse gas emissions must be reduced to avoid the worst impacts of climate change, we cannot afford to be making long-term decisions that move us in exactly the opposite direction.”
The DNR permitting is not the only legal dispute the project is currently facing. Earlier this year, the state’s Public Service Commission instituted a tariff that outlines how data center companies must pay for the required energy use and compels them to put up a large amount of collateral for necessary infrastructure improvements. The tariff is designed to insulate regular Wisconsinites from seeing their energy bills increase or being left to cover the costs of massive upgrades to the grid if a company fails or abandons the project.
Oracle has argued it doesn’t have enough funds to meet the collateral requirements and appealed to the PSC to reconsider. This week, the PSC declined that appeal, setting up a legal battle over the tariff.
A DNR spokesperson said the agency couldn’t comment on active litigation.
Wisconsin’s Public Service Commission (PSC) has no plans to reconsider We Energies’ request to loosen credit rating rules for data center developers.
The commission voted in April to require data center developers with below-threshold credit ratings to provide financial guarantees before receiving electric service from We Energies. Ratepayer advocates say the requirement shields other customers from financial risk if a data center operator can’t afford to pay for infrastructure built on its behalf.
That requirement could cost tech giant Oracle, the co-developer of a Port Washington data center campus, over $100 million per year. We Energies asked the PSC to reconsider the rule last month, arguing that the added cost could dissuade other companies from operating in Wisconsin.
The three-member commission has until Friday to act on the request. The commissioners did not include the request on Thursday’s meeting agenda, and, as of Thursday evening, had not scheduled a Friday meeting to consider it. State law requires the commission to notify the public of scheduled meetings at least 24 hours in advance.
The PSC will instead defend the credit rating requirements in Ozaukee County Circuit Court, where Oracle sued the agency last month.
Guardrails
Commissioners approved the credit rating rules as one of several guardrails in We Energies’ new “very large customer” rate structure to prevent cost shifts from data center developers to the utility’s other customers.
The new rate structure requires We Energies to bill data center customers alone for power plants built to serve them. A single power plant can cost hundreds of millions of dollars — or, in the case of the proposed Red Oak Ridge plant in the town of Paris, more than a billion dollars. If a data center developer goes bankrupt, We Energies’ other customers could be on the hook for any remaining costs tied to the power plants.
With that worst-case scenario in mind, the PSC set a credit rating threshold for data center developers seeking We Energies electric service. Credit ratings measure a company’s financial health and likelihood of repaying debts on time. Developers with credit ratings below A- must provide financial guarantees to receive service. Those financial guarantees would help cover costs if a developer runs into financial trouble.
Wisconsin’s Citizens Utility Board and other ratepayer advocacy groups supported the “belt-and-suspender” approach to protecting smaller customers.
Exemption sought for Oracle
Oracle, a Texas-based cloud computing giant, currently holds a BBB credit rating — a tier below the A- threshold but still considered investment-grade by ratings agencies. The company’s aggressive borrowing in support of its artificial intelligence ventures pushed Oracle’s debt-to-equity ratio above 400% as of May, and its stock price has tumbled more than $50 in the past month alone.
The PSC-approved rate structure would require the Oracle subsidiary involved in the Port Washington project to provide more than $100 million a year in cash deposits or letters of credit to receive We Energies service.
“If the Commission does not reopen its decision on this issue, the implications for Wisconsin would be significant and limit the ability of numerous investment-grade companies to invest in Wisconsin,” We Energies wrote in its June 10 request that the PSC reconsider the credit rating rules.
The utility urged the commission to exempt companies with “investment-grade” credit ratings, including BBB ratings, and to waive the Oracle subsidiary’s financial backing requirements.
We Energies maintains that concerns about Oracle’s credit-worthiness are misplaced.
“In practical terms, tens of billions of dollars in Oracle’s value would need to be destroyed before creditors or counterparties, such as Wisconsin Electric and its other customers, could experience losses,” the utility’s attorneys wrote in their petition.
Friday’s deadline is the commission’s last chance to act on the request, but We Energies doesn’t expect any last-minute action.
“We are disappointed the commission chose not to revisit the financial support requirements under our Very Large Customer rate,” We Energies spokesperson Brendan Conway wrote in an email to Wisconsin Watch on Thursday. “We believe updating the financial support requirements will help ensure the policy meets the goal we all agree on: protecting customers while supporting jobs and economic growth in Wisconsin.
The environmental advocacy group Clean Wisconsin, on the other hand, applauded the commissioners.
“The Public Service Commission did the right thing when it created this special rate structure for AI data centers, and it’s doing the right thing now by rejecting the petition,” Brett Korte, the nonprofit’s attorney, wrote in a Thursday press release. “This is about protecting We Energies’ other customers — families, small businesses, schools, manufacturers — and shielding them from the risks associated with these enormous energy users.”
Oracle is asking the Ozaukee County Circuit Court to intervene.
In its June 19 lawsuit, the company argues the commission acted outside its authority and without sufficient evidence to justify the rule. Oracle also maintains that the A- threshold isn’t “needed to prevent harm” to We Energies’ other customers or shareholders.
Microsoft’s questions
Also absent from the PSC’s agenda this week: a request from Microsoft to “clarify” parts of the data center rate structure.
Microsoft, the developer of the new data center campus in Mt. Pleasant, asked the PSC last month about the impact of potential changes to federal rules dictating how transmission utilities spread the construction costs of new infrastructure.
The five-member Federal Energy Regulatory Commission (FERC) — not the Wisconsin PSC — has jurisdiction over how utilities allocate transmission costs.
The data center boom will require new transmission infrastructure, and FERC has yet to develop new rules to assign the cost of those projects to data center developers. The American Transmission Company, Wisconsin’s largest transmission utility, signaled this spring that it plans to ask FERC to approve a new cost allocation model.
In the meantime, Wisconsin’s PSC approved what commissioner Christi Nieto called a “temporary stopgap measure.” We Energies passes transmission costs to customers based on their electricity use, and the commission-approved rate structure sets a floor for data centers’ transmission bills based on projected electricity needs.
Microsoft argues that the possible federal rule changes create enough “ambiguity” to merit reconsidering how it will be billed for transmission costs after FERC considers new options.
The PSC also had until Friday to act on Microsoft’s request.
This story was updated July 10 to include information about Microsoft’s We Energies rate structure.
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A view of a data center in Loudoun County. (Photo courtesy of Karen Graham/Loudoun Times-Mirror)
Demand for internet access and electronic storage has grown alongside digital technology itself. At the center of that growth are the energy infrastructure and data centers that governments and companies began developing in Northern Virginia in the late 20th century. Today, the region houses the world’s largest concentration of data centers, making Virginia the nation’s digital capital.
That growth has brought major economic benefits for local governments, but it has also divided communities increasingly weary of the facilities’ heavy demands on water and energy, among other impacts.
The commonwealth’s rise as a global digital leader did not happen overnight, said House Technology Committee Chair Cliff Hayes, D-Chesapeake. It was a result of years of persistence, long-term planning and problem-solving.
”This designation for the commonwealth to be the digital capital not only of this country but of the world has taken a lot of stamina, resilience and vision,” Hayes said.
Hayes said leadership also means adapting to new challenges. This year alone, lawmakers passed an entire package of bills aimed at further regulating the industry, while the fight over tax incentives remains largely unsolved.
A view of a data center in Loudoun County next to Chick Ford & Ryan Bickel Fields. (Photo courtesy of Karen Graham/Loudoun Times-Mirror)
AOL’s move
Ashburn’s rise as one of the largest digital infrastructure hubs began in 1997 with the arrival of America Online, or AOL, then the primary internet gateway for many users. Soon after, UUNet/WorldCom and the relocation of the Metropolitan Area Ethernet East, a major internet exchange and traffic hub, helped create unmatched fiber connectivity, turning Loudoun County into a key internet crossroads and destination for other businesses.
Buddy Rizer, executive director for Loudoun County Economic Development, said AOL’s decision to locate in Loudoun helped make the internet mainstream for Americans and anchored the infrastructure that turned Loudoun and Virginia into the world’s leading internet hub.
“You can’t overstate the importance of AOL, right? AOL didn’t invent the internet, but they made it accessible to ordinary Americans at the moment that the commercial internet was starting to take off… by the late 1990s AOL had 20 million subscribers, and roughly half of U.S. homes that had internet were using AOL by 1997.”
Rizer said once Loudoun established core infrastructure and attracted a few anchor companies, growth became compounding: infrastructure drew companies, companies brought more infrastructure and the cycle continued for roughly 20 years.
Data storage and computing explodes
While data centers have existed in Virginia for decades, the recent rise of artificial intelligence has accelerated demand for the warehouse-like facilities that store and process data around the world.
Ali Mehrizi-Sani, a professor at Virginia Tech, said Northern Virginia had many of the right ingredients to attract the industry even before the state sales and use tax exemption passed in 2008.
“The fact is that we have a lot of customers of data, and that’s really the federal government and their contractors,” Mehrizi-Sani said. “They use a lot of data, so really just proximity to Washington, D.C. has been a main driver of honestly everything in Virginia, including data centers.”
The early development of the internet exchange points in Virginia, combined with large stretches of undeveloped land in Northern Virginia, also helped fuel the industry’s growth. Loudoun County, for example, was far more rural than it is today.
Loudoun recorded 71 operating data centers, the most of any locality in the commonwealth, according to a 2024 study by the Joint Legislative Audit and Review Commission. Statewide, 131 data centers were operating at the time.
A home in Loudoun County, VA next to a data center. (Photo courtesy Karan Graham at Loudoun Times-Mirror)
“That’s why you see data centers are coming further south, even to areas like where I live in Roanoke and Botetourt County, essentially in search of land,” Mehrizi-Sani said.
He said data centers have also remained in Virginia because electricity rates are comparatively lower than in other parts of the country. Another major factor is the state’s sales and use tax exemption.
Tax breaks and tax gains
In Loudoun, data center revenue has generated substantial tax income year after year, providing the county with more than $100 million annually to support schools and government services. The revenue stream — estimated at about $1.3 billion in 2027 — has grown enough that the county has reduced real estate tax rates for homeowners every year for the past decade, according to county officials.
Revenue from data centers has also allowed county leaders to propose reducing the personal property tax rate on vehicles beginning in tax year 2026 and eliminating the $25 vehicle license fee.
In 2008, the General Assembly approved a statewide incentive allowing data centers to avoid the state’s 5.3% sales and use tax, which at the time was estimated to save the industry about $1.5 million annually. Data centers routinely refresh computer equipment and software, the exemption can significantly reduce costs every few years.
Now, however, the cost of the tax break has ballooned to about $1.9 billion annually in foregone state revenue.
While the tax break had previously been extended, and former Gov. Glenn Youngkin sought to continue it through 2050 in his final budget proposal, debate over potentially ending the incentive led to months of negotiations and brought Virginia to the brink of a government shutdown after lawmakers failed to pass a budget until the final days of June.
Some lawmakers argued the industry had benefitted enough from the tax exemption. At the same time, concerns over rising energy costs and environmental impacts prompted legislators to look for ways to reclaim some revenue from the trillion dollar industry.
But Gov. Abigail Spanberger led the push to preserve the tax break, arguing Virginia had “made an agreement” and should not reverse course. The exemption is currently set to expire in 2035 unless lawmakers change it before then.
“We know technology is not bad,” Senate Finance Committee Chair Louise Lucas, D-Portsmouth, said last month. “We all can benefit from technology, but we, as a government, have not done a good job in managing the regulations and the impact on our communities, and that’s what we’ve got to rein in. But we’ve also got to rein in the fact that data centers – they’re some of the largest corporations on the face of the Earth, trillion dollar organizations – are getting tax exemptions right now.”
While the exemption ultimately remained in the budget, lawmakers approved a new energy consumption tax on data centers expected to bring in a total of $600 million annually, or $1.2 billion over the biennium. The industry will pay 1.1 cents per kilowatt-hour of electricity consumed up to the cap, with any excess refunded at the end of the fiscal year.
A view of a data center in Loudoun County. (Photo courtesy of Karen Graham/Loudoun Times-Mirror)
Dominion Energy and Mecklenburg, Northern Virginia, and Rappahannock electric cooperatives reported in 2023 that data centers used about 5,050 megawatts of power that year, based on peak-load forecasts, according to the Joint Legislative Audit and Review Commission.
“What I have found is that some of the businesses coming to our commonwealth, they want to make investments in our communities and in our workforce. The consumption tax, as we’ve conceived of it here in the commonwealth, is one that’s based on fairness,” Spanberger told The Mercury last month.
Lawmakers also approved new water use regulations for data centers in areas designated as water scarce and within the water management area east of Interstate 95.
The changes aim to push facilities away from evaporative cooling systems that consume millions of gallons of water annually and toward more efficient technologies. Also, for the first time, the state will regulate data center noise levels.
The General Assembly also passed bills requiring cleaner backup generators that emit fewer carbon emissions and measures intended to help localities better assess the residential and environmental impacts of proposed facilities.
Public policy
In 2010, Virginia created a retail and sales tax exemption for data centers, a factor companies have consistently identified as important in site selection.
Loudoun designated large areas for industrial and employment uses where data centers could be built, helping reduce development timelines and support continued growth.
Through successive comprehensive plans, Loudoun also reserved large tracts of land in eastern Loudoun — near Washington Dulles International Airport and the W&OD Trail — for industrial and employment uses close to existing fiber networks and electrical infrastructure. The move ensured a long-term supply of development-ready sites for large-scale data center campuses.
Opposition from residents has grown in recent years, with hundreds of community members attending local government meetings to oppose projects near homes, drinking water supplies and high-voltage transmission lines. Residents have urged lawmakers to impose stronger regulations and seek greater financial contributions from the industry for supporting infrastructure.
What’s next
Last week, lawmakers ordered a work group to study how the data center tax exemption could be phased out or modified to generate additional state revenue. A report is due in November.
While Spanberger has described the new consumption tax as “fair,” the data center industry disagrees. After lawmakers approved the budget amendments last week, Data Center Coalition CEO Josh Levi said the new tax will “drive away investment and job creation, and tarnish Virginia’s reputation.”
“The message to businesses in all industries is clear — Virginia is no longer a reliable partner,” Levi said in a June statement.
A view of a data center in Loudoun County between the fences and trees in a residential area. (Photo courtesy of Karen Graham/Loudoun Times-Mirror)
Rizer argued that Loudoun’s and Virginia’s future depends on treating data centers as a foundation for broader technology growth while maintaining a stable and predictable business climate.
“You can’t take success for granted … the principle that made us successful is a predictable, welcoming environment with predictable tax and policy issues,” Rizer said. “The only way that that success can go into the future is by staying grounded in those principles that brought us this far.”
As for federal involvement in an issue that has become a national flashpoint, Democratic U.S. Sen. Tim Kaine of Virginia, who was governor when the tax exemption passed, said states should decide individually how to manage data center growth rather than adopt a one-size-fits-all approach.
“(Data centers are a) global phenomenon, and being a leader in this important area is good for America’s national security and for Virginia’s economy,” Kaine said. “But there are real challenges when it comes to water, power and land use, so local communities must get a say when it comes to how to handle them.”
Virginia has become the state that many others are watching as they weigh to and regulate the growing data center industry. Lawmakers now face balancing the promise of economic investment with mounting concerns from residents pushing back against continued expansion.
Editor’s note: This story has been updated to reflect the correct amount of data center revenue in Loudoun for fiscal year 2027, which was $1.3 billion, not $890 million as previously reported.
This story was originally produced by Virginia Mercury, which is part of States Newsroom, a nonprofit news network which includes Wisconsin Examiner, and is supported by grants and a coalition of donors as a 501c(3) public charity.
Residents of communities across Wisconsin have opposed the construction of hyperscale data centers. (Henry Redman | Wisconsin Examiner)
Correction: The initial version of this story stated the plaintiffs in the lawsuit live in Mount Pleasant, when they actually live in Sturtevant.
Three Sturtevant residents have filed a class action lawsuit against Microsoft over the loud noises emitted by the company’s 1.2 million square foot Fairwater data center in Mount Pleasant.
The lawsuit, filed Wednesday in the U.S. District Court for the Eastern District of Wisconsin, alleges that “on frequent, recurrent, and continuing occasions too numerous to list herein, Plaintiffs’ properties have been and continue to be physically invaded by excessive noise.” The three residents filing the suit, Garret Ostergaard, David Wade and Joy Wade, all live within 1.5 miles of the data center.
The lawsuit states that the excessive noise from the data center has forced Ostergaard to change his work schedule from third to second shift because he couldn’t sleep. The Wades allege that the constant hum of the data center has made it difficult for them to enjoy their backyard.
In the lawsuit, the source of the noise is attributed to the data center’s massive cooling fans.
In filing a class action suit, the plaintiffs are arguing to represent anyone who lives within a 1.5-mile radius of the data center, which the lawsuit states includes more than 1,000 households.
Microsoft refers to its Mount Pleasant data center as an “AI superfactory” and the “world’s most powerful AI datacenter.” An analysis conducted last year by Clean Wisconsin found that Microsoft’s data center in Mount Pleasant and Vantage’s currently under construction data center in Port Washington promise to use more energy than every household in the state.
David Crowley, Milwaukee County Executive. (Photo by Isiah Holmes/Wisconsin Examiner)
David Crowley is no stranger to crowded political races. Before becoming Milwaukee’s first African American county executive in 2020, he had to emerge from a hotly contested primary that included Democratic Sen. Chris Larson (D-Madison), former state Sen. Jim Sullivan, Glendale Mayor Bryan Kennedy and then-county board chairman Theodore Lipscomb. Both Larson and Crowley advanced to the general election, which Crowley narrowly won. Over six years later, Crowley again finds himself in a Democratic primary, this time for the governor’s office, packed with experienced policymakers.
Crowley’s opponents this time include Lt. Gov. Sara Rodriguez, state Sen. Kelda Roys (D-Madison), state Rep. Francesca Hong (D-Madison), former Department of Administration chief Joel Brennan, and former Lt. Gov. Mandela Barnes. In a straw poll at the Democratic Party convention in mid-June, Crowley placed fourth, with Rodriguez and Hong finishing first and second and Roys placing in third.
“Even though they’ve done great work in their respective roles, the one thing they’ve never done is actually run government,” Crowley said of the other Democratic candidates during an interview at Pilcrow Coffee in Milwaukee. “I’m the only executive in this race. And what’s also different for me is that I know what it means to be accountable and responsible for my actions and decisions, and how they’re going to affect the masses and the people that I represent.” Another key difference, he added, is that he’s got the “receipts.”
Crowley highlighted how under his tenure, close to 1,000 units of affordable housing have been created across Milwaukee County. The past four years have also seen drug overdose deaths decrease by 40% with the expansion of harm reduction strategies. In 2023, the county also saw the largest property tax cut in its history, totalling $21 million.
“What sets me apart is the fact that I’ve delivered for folks,” said Crowley. “And I continue to deliver for folks, and I’ve been able to do it in some of the most contentious times, if you will — especially with how partisan we are nowadays — as a lead Democrat representing the largest and most diverse community in the state of Wisconsin.”
In his first statewide race, Crowley said he wants to avoid labeling himself. “I’m a voting Democrat,” said Crowley. “I’m a Democrat that gets things done.” Crowley scoffs at ideological purity tests and the buzz about a rift among Democrats who identify as Socialists versus those who see themselves as moderates. “This is about how do you fight back against the Trump administration, but more importantly not just reacting, but how do we become more proactive when it comes down to Democratic policy that we need to push so we can actually win?”
Crowley is leaning on his track record in his campaign. His platform is laid out in what he calls his “Badger Basics Plan” which includes:
Bringing universal childcare to Wisconsin, and working to cap childcare costs at 7% of household income
Establishing universal K-4 across Wisconsin, giving kids a better foundation of learning before entering the school system
Making sure that school districts have the funding, staff and resources that they need
Expanding Badgercare as a public health option, and increasing reimbursements
Repealing Act 10 and restoring the collective bargaining rights for workers
Implementing restrictions on data centers and Artificial Intelligence (AI), while making sure AI enhances productivity rather than replacing job opportunities
Supporting programs for vulnerable people, especially the victims of domestic violence
When he’s not busy with his full-time day job running the county, he has been campaigning all over the state. “We have been everywhere,” he said. “I think we’ve done 40-plus forums around the state already, whether we are in southeastern Wisconsin, or Taylor County, or in Brown County, or in Marinette County, or Wausau, La Crosse. We’re traveling everywhere not only to spread the message, but more importantly to listen.” When he was a young organizer, Crowley likes to say, he learned that “if you don’t have a seat on the table, you’re on the menu.”
Confronting questions about race
In his travels, Crowley said, he believes he can overcome negative racial perceptions some voters have about him and the county he represents. “It’s not a real concern for me,” he said of the history-making task of becoming Wisconsin’s first Black governor. “They already trust me to deliver because I’ve been doing it as a county executive and I’ve done it as a state representative.”
In fact, Crowley feels that the question of race comes up mostly in the state’s more diverse communities. “We have been conditioned, because we have been listening to the Republican talking points for so long, to where we have internalized it more and we use it as a reason as to why we can’t get certain things done,” he said of all the conversation about Wisconsin’s racial divide. “And honestly, I think it stops us from getting comfortable with being uncomfortable. Building those relationships, going outside of our geographic comfort zone to talk about the things that we have done here, in one of the largest urban centers in the entire country, and how we can bring those best practices to communities across the state. What’s good for Milwaukee is good for every single town, village, and city in the state of Wisconsin.”
Joel Brennan (left), David Crowley (center) and Mandela Barnes (right). (Photo by Isiah Holmes/Wisconsin Examiner)
Crowley points out that Wisconsin elected Tammy Baldwin, its first openly LGBTQ U.S. Senator. Wisconsin voters also elected “a skinny kid with a funny name by the name of Barack Obama,” he said. “We have been put into a box. It’s our job to think outside that box. It’s our job to shatter that glass ceiling and focus on how we’re going to deliver. Because people don’t care where you’re from. People don’t care what you look like. People don’t care who you love. They care about whether or not you’re going to care for them, and deliver real results moving forward.”
The fact that he performed well in his election to his current post in suburban areas built up Crowley’s confidence. “I know they’ll vote for me, because they voted for me twice already,” he said. “That’s the type of experience that we need to not only stand up to Donald Trump, but that’s going to be proactive and be on the offense to deliver for the 6 million people that call Wisconsin home.”
Going around the state, Crowley has met people who want their voices heard on important issues from childcare and healthcare to lowering utility costs and making housing more affordable. He said he’s learned that even in a divided state like Wisconsin, people agree on more than they realize. “I think that in this particular political climate, as things become more polarized, no matter if you’re the far left or the far right, I think we can all agree that government isn’t working,” he said. “And right now, we need to make sure that we are electing individuals who are not just going to fight back against policies that are going to leave families behind, but how are we going to be proactive in making sure that we’re pushing policies to make sure that when the tides rise, all of us rise.”
Data centers
One of the hottest issues in local communities around the state is the rise of giant data centers, proposed in communities across Wisconsin, and needed to feed the energy demand of a rapidly expanding artificial intelligence infrastructure. By 2023, a United Nations report found, global data centers will require the same amount of water annually as the 1.3 billion people who live in Sub-Saharan Africa, and require enough electricity to equal the annual needs of Pakistan, Bangladesh and Nigeria combined. Communities in Wisconsin have been pushing back on data centers due to concerns about increased utility costs, environmental fallout and the trajectory of AI.
Crowley said “it’s asinine” that the Legislature ended its recent session without doing anything to regulate data centers.
Residents of communities across Wisconsin have opposed the construction of hyperscale data centers. (Henry Redman | Wisconsin Examiner)
Crowley, who is not opposed to data centers, said it’s crucial that the state develop a “framework” to protect natural resources and the people of Wisconsin.
Earlier this year, the Wisconsin Public Service Commission approved an energy rate, requiring data centers to pay 100% of their own energy costs. Data centers should also have to pay 100% of the cost of the energy grid upgrades they require, Crowley said, as well as any infrastructure upgrades. He also wants to tie their development to investments in renewable energy. “I want to see more energy opportunity that doesn’t cost us any money,” he said. “Wind doesn’t cost us. Sunlight doesn’t cost us.” If Wisconsin invests in renewables, “moving forward it won’t be a huge drain on resources for ratepayers, or for these utility companies.”
Crowley also said that as governor he would require data centers to use union labor, project labor agreements and community benefit agreements. He added he wants to explore how data centers could be leveraged to benefit public schools, communities and already existing industry.
As the leader of a county that has experienced the rise and fall of heavy industry, he said he thinks about how to plan ahead 50-100 years with data centers, to prevent them becoming empty shells, like abandoned Rust Belt factories, in the communities where they are built. He also feels that moving forward, Wisconsin needs to be “intentional” when it comes to giving out tax exemptions and tax credits for data centers, which have already been given $2 billion in tax exemptions. Crowley said that it’s not just the surge of up-front jobs which build the data center to consider, but also the smaller number of long-term jobs on the back-end. Protections need to be put in place to make sure communities are getting ahead, Crowley said.
Education and school choice
Crowley describes himself as a strong advocate for public schools. He, his wife, and his three daughters are all public school graduates But, he said, he also doesn’t believe in eliminating Wisconsin’s entire private school choice system outright. Half of the kids enrolled in school in Milwaukee go to public school while the other half go to private or charter schools. If charter schools were eliminated, that would create a strain on an already stressed public school system, Crowley said. He said he believes in accountability for choice schools and recognition that public schools have a greater responsibility and level of accountability, since they are required by law to serve every child who comes in the door.
Working across the aisle
Crowley is optimistic that, as a Democratic governor, he can work with Republicans in the Legislature, especially since, he says, new voting maps will help depolarize the state. He believes that the old maps forced people into separate corners. “We have to focus on partnerships and collaboration if we want our state to move forward,” said Crowley. He also feels that Democrats need to be prepared to play offense and be proactive. He said voters will need to be patient with a Democratic governor as the party adjusts to its new identity after this year’s elections. With the new voting maps, Democrats have an opportunity to gain a majority in the Legislature as well as the governor’s office for the first time in almost 30 years.
“We have a lot to prove as Democrats,” Crowley said. “We have a lot to prove as leaders of our community, to show that we can govern, we can win elections moving forward, and we can plan for the long term.”
Editor’s note: The Examiner is running periodic profiles of the contenders in the Aug. 11, 2026 gubernatorial primary as well as the candidates in the general election Nov. 3.
Tech firm Oracle is suing Wisconsin’s Public Service Commission (PSC) in Ozaukee County Circuit Court, opening a new front in a fight over financial protections for Wisconsin ratepayers.
The June 19 lawsuit comes as Oracle and We Energies — the utility set to power the company’s planned data center in Port Washington — are asking the PSC to reconsider credit rating requirements for data center developers that could cost the company millions of dollars a year.
Oracle’s lawsuit seeks to accomplish the same ends through the courts.
The PSC approved We Energies’ “very large customer” rate structure in April, requiring the utility to exclusively bill data center customers for new energy generation infrastructure needed to serve them, among other protections for existing ratepayers. The agreement also requires data center developers with credit ratings below A- to post financial guarantees to reduce the risk of shifting costs to other customers if a developer runs into financial trouble.
Oracle currently holds a BBB credit rating — a tier below the PSC standard, but still considered investment-grade by ratings agencies — largely because of aggressive borrowing to finance new artificial intelligence infrastructure. Under the current rate structure, the Oracle subsidiary involved in the Port Washington project would need to provide cash deposits or letters of credit exceeding $100 million per year to receive service from We Energies.
“If the Commission does not reopen its decision on this issue, the implications for Wisconsin would be significant and limit the ability of numerous investment-grade companies to invest in Wisconsin,” the utility’s attorneys wrote in a June 10 request to reopen the case.
We Energies also contended that Oracle runs little risk of defaulting on its obligations.
“Tens of billions of dollars in Oracle’s value would need to be destroyed before creditors and counterparties, such as Wisconsin Electric and its other customers, could experience losses,” the utility’s attorneys wrote. Even in a bankruptcy, they added, generators built to serve data centers “will still have value and will be able to provide electricity to other customers.”
We Energies and Oracle asked the PSC to consider a stepped approach to security requirements that eases the burden on companies with “investment-grade” credit ratings, including BBB ratings, and to waive the Oracle subsidiary’s financial backing obligations.
In its lawsuit, Oracle asked the court to “set aside, reverse and remand” the credit rating limits in the PSC-approved agreement, arguing that the commission acted outside of its authority and without sufficient evidence to justify the rule. The company maintains that the A- bar isn’t “needed to prevent harm” to We Energies’ other customers or shareholders, and that the commission “failed to consider the significant, adverse impacts” of the requirement on Oracle.
Ratepayer advocates and clean energy groups support the PSC credit rating requirements, and some of the same groups are pushing back against Oracle’s efforts to reopen the issue.
“We believe that PSC did its job,” Clean Wisconsin spokesperson Amy Barrilleaux said. “It cannot leave all these other thousands of customers vulnerable.”
The company hired attorneys from the Madison office of law firm Husch Blackwell. One of those attorneys, David Zoppo, has previously represented investor-owned utilities before the PSC. Oracle’s attorneys did not immediately respond to requests for comment.
The credit rating dispute could shape future electrical service contracts between data center developers and utilities.
Northern States Power Company, a subsidiary of utility giant Xcel Energy that provides electrical service to parts of northwestern Wisconsin, asked the PSC on Monday for its own “very large” customer rate structure.
That proposal would set the credit rating bar at BBB-, the lowest investment-grade category. Potential data center customers below that threshold would need to provide additional financial guarantees.
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Even for a guy like Ron Brisbois, whose job is to cultivate prosperity, a data center proposed for Wisconsin’s Driftless Area was too big to imagine.
Nothing like this had come along in Brisbois’ quarter-century as economic development director in rural Grant County. An up to $2 billion project spanning 500 acres would be at least three times larger — in dollars and space — than any development in the county.
The construction contracts. Dozens of new permanent jobs. Millions of extra tax revenue for schools and local government. This is what economic development is all about.
For months, the out-of-state developers pitching the data center spoke repeatedly with Brisbois. They toured the county in Wisconsin’s southwest corner. They visited Madison to discuss details with state officials.
Their talk was big.
But Brisbois never dug into the developers’ backgrounds.
Then, as if someone flipped a switch, they stopped returning his calls.
Now, a project that would have been historically transformational — and was already highly controversial — is all but dead.
Drawing on two months of behind-the-scenes interviews Wisconsin Watch conducted with Brisbois, here’s the behind-the-scenes story of the rise and fall of a data center proposal.
Out for a drive
The Driftless Area’s rugged hills and steep valleys inspire strong pride in Grant County — and concern about large-scale development. (Joe Timmerman / Wisconsin Watch)
Brisbois first heard about the data center last fall. A colleague told him the developers were scouting northern Illinois for a cryptocurrency project when they drove across the border into Grant County and looked up to see the Cardinal-Hickory Creek transmission line. It delivers electricity along a 100-mile corridor from Dubuque County, Iowa, through Cassville in Grant County, to Dane County.
The developers quickly surmised that with access to the kind of power that artificial intelligence data centers desperately need, the town of Cassville (population 400) could be ideal.
“There’s a chunk of power there, Ron, and we need to grab it before someone else does,” Brisbois recalled the developers saying. “If we don’t, someone else will.”
Brisbois’ reaction: “Well, why shouldn’t we?”
The median $67,000 household income among Grant County’s 52,000 residents is $10,000 below the state median; 12% live in poverty.
Brisbois said he initially felt curiosity, not excitement, “because I never would have thought a project like that would look at this area.”
The two-man team included a businessman from the Northeast and a technical expert from the South.
Even now, citing a custom of confidentiality common to economic development proposals, Brisbois won’t identify them.
The man for the job?
Early in his career, not long after working in economic development for the former state Department of Commerce, Brisbois yearned to bring jobs and industry to his home area.
Ron Brisbois, Grant County Economic Development Corp. executive director, poses for a portrait in his office, June 4, 2026, in Lancaster, Wis. (Joe Timmerman / Wisconsin Watch)
Married with two grown daughters, Brisbois, 60, grew up on a southwest Wisconsin dairy farm and still does a little farming of his own. After six years in the state job, he became executive director of the Grant County Economic Development Corp. in 1999. A resident of Ithaca in Richland County, which borders Grant, he’s a former Ithaca School Board member and currently serves on the town board.
“I’ve had multiple staff, people from multiple governors tell me, ‘Ron, we love what you do, but we like to see these projects done in Milwaukee, Madison or the Fox Valley,’” he said.
“And that’s because of votes. And I get it. I’m not naive. I mean, people want to get reelected. They want to have their impact. And I appreciate it. But things like that really motivated me. It’s like, what could I do out there (in the Driftless)?”
First meeting, excitement builds
Brisbois began work in earnest on the project Nov. 6. He gave the developers a book of maps, noting where the transmission line runs. He emailed Grant County Board chair Bob Keeney, saying he would meet the next week with a “data center prospect who is flying in from Rhode Island.”
Keeney called the news exciting.
“My meeting is the first of the day for them,” Brisbois told Keeney. “Then they meet with the energy reps. Land is my primary assignment, plus they want to know about the political feel for such a project.”
The meeting, requested by the developers, was at Scenic Rivers Energy Cooperative in Lancaster, the county seat. Because of a storm on the East Coast, they drove instead of flying.
“It was about a less than a half-hour meeting,” Brisbois recalled. “And I just said, ‘What are you guys thinking?’ And that’s where they started talking about a hyperscale project.”
“It was more of just feeling them out,” he added. “OK, what scale? And that’s where they talked about $1 billion to $2 billion. And they started to talk in the 500-acre range.”
They understood there would be a lot of work to confirm that enough power would be available.
The developers were also considering sites in Indiana and North Dakota. They didn’t ask about financial incentives, but wondered what the public might think about a data center. Brisbois told them residents would want to know about jobs, but he emphasized more local tax revenue. The developers had seen a headline in the Grant County Herald Independent about local schools and municipalities struggling with budgets.
Momentum built after more conversations with the developers.
Brisbois began to let himself feel excited.
“I was (thinking): OK, there’s potential here.”
Going public, progress continues
Brisbois went public a month after the first meeting. He announced Dec. 3 at the annual meeting of the Grant County Economic Development Corp. that a $1 billion data center had been proposed for the county. The Herald Independent reported on it a week later.
It would be three times or more larger than the largest development in the county, A.Y. McDonald’s $350 million, 100-acre foundry.
Brisbois said the developers later asked, “How did this get out?” He told them he wanted to be transparent.
“I’m sure my (economic development) colleagues would have said, ‘You were a fool to do it. I would never have released that information.’”
But progress continued.
Brisbois met again in early February at Scenic Rivers with the developers.
“It was more of, you start getting into the brass tacks of the project. The formality kind of is done. You’ve met them, now you’re on a first-name basis, that type of thing.”
Brisbois was also encouraged by a virtualmeeting he had in February, the same month that officials two hours away in Beaver Dam announced they were working to land a $1 billion data center, which is now under construction. The meeting was with Prescott Balch, who has been sought out by data center opponents around Wisconsin for his expertise. Balch confirmed that he agreed that Brisbois’ estimate of 50 permanent jobs seemed solid.
“If I start talking 50 jobs, that’s a big deal in Grant County,” Brisbois said.
And yet, the developers never told Brisbois where exactly in the county they wanted to locate.
Opposition takes hold
A “No Data Center In The Driftless” sign is posted outside of a home, June 4, 2026, in Grant County, Wis. (Joe Timmerman / Wisconsin Watch)
People in Grant County have particular affection for being part of the Driftless Area, with its rugged hills and steep valleys, the result of being missed by the last glacier that covered most of Wisconsin. They worry about too much development.
Data center opponents began mobilizing early in 2026, but interest peaked March 8, when hundreds attended a rally featuring comedian Charlie Berens. The efforts of Pete Moris and Melodie Betts were beginning to pay off.
Moris, a public relations executive and Grant County native, has a son Grant, named after the county. He believes the data center would be too large for the Driftless Area and fears it would harm water wells.
Moris recalled the December newspaper story about Brisbois announcing the proposal.
“That set off alarm bells because if Ron’s talking about it in the paper, then this had to be in the works for a while,” Moris said. “And the fact that we weren’t being told who the developer was and who the end user is, that’s scary.”
Betts, a restaurant owner who drinks only reverse osmosis-purified water, also worries a data center would harm the water supply and attract more development.
“If we don’t stop this now, we’re going to lose everything that’s precious in the Driftless Area,” she said. “You let one in, you open up the door.”
Data center opponent Pete Moris poses for a portrait on June 4, 2026, in Grant County, Wis. (Joe Timmerman / Wisconsin Watch)
Data center opponent Melodie Betts poses for a portrait, June 4, 2026, in Grant County, Wis. (Joe Timmerman / Wisconsin Watch)
Data center opponent Pete Moris points out a discussed location of a proposed $2 billion data center, June 4, 2026, in Grant County, Wis. The proposal now appears to be dead. (Joe Timmerman / Wisconsin Watch)
Data center opponents Pete Moris, left, and Melodie Betts follow Raptor Resource Project manager Ryan Schmitz into the Eagle Valley Nature Preserve, June 4, 2026, in Grant County, Wis. (Joe Timmerman / Wisconsin Watch)
Progress and optimism rise
As opponents claimed the spotlight, the developers seemed to back off.
About a week after the Berens rally, the developers called Brisbois out of the blue. “That was unusual,” Brisbois recalled.
They said a potential operator of the data center had asked about incentives, including a tax increment district (TID).
A TID is a common tax break that commits future property taxes from a land parcel’s anticipated increase in value to finance a proposed development.
Brisbois said he told the developers he didn’t think a TID would be legally possible for a town. He said he thought that not offering the tax break would appeal to residents, but sensed the developers disagreed.
“I don’t think they saw it as that,” he said. “After that, dead quiet.”
Brisbois followed up with two calls, leaving messages — but, for the first time, got no response.
They had always been “very prompt,” he said.
Then the developers reengaged.
They flew to Chicago and drove to Madison to meet with Brisbois and the Department of Natural Resources on March 19. They discussed state regulatory issues such as permits for air, water, wetlands and other issues. The developers emerged “feeling very good,” even as they began to hear the approval process would be time consuming, Brisbois said. In later phone calls, the developers were enthused that the data center might qualify for a state sales tax exemption.
That exemption is expected to be worth billions of dollars to data centers around the state.
The Eagle Valley Nature Preserve observation tower overlooks the Mississippi River and Gutenberg, Iowa, June 4, 2026, in Grant County, Wis. The 1,450-acre preserve is just north of site that was considered for a data center. (Joe Timmerman / Wisconsin Watch)
By early April, Brisbois was confident enough to release more details, including an estimate that the data center would produce $5.5 million per year in property tax revenue to municipalities and school districts in Grant County. He said he had received fewer than five phone calls or emails opposing the data center, which had been “demonized” through social media, and dozens of supportive contacts, particularly from the local school district.
Keeney called local data center supporters “a silent majority.”
Brisbois also was optimistic because he felt he provided the developers what they needed. It was up to them to proceed with financing and acquiring land.
“From my perspective, they should have all that they need to put their ducks in a row,” he recalled. “I don’t know then why they wouldn’t proceed in Grant County.”
Brisbois had rated the chances of getting the data center as 1-in-12 after his first meeting with the developers, then 1-in-6 after the second meeting.
On April 6, he said it was better than a coinflip. “I would say right now, it’s leaning towards.”
‘Dead quiet’ and a town residents uprising
A “No Data Center In The Driftless” sign is posted, June 4, 2026, in Grant County, Wis. (Joe Timmerman / Wisconsin Watch)
It didn’t take long for that optimism to fade.
Data center opponents had been contacting Brisbois’ board members, so he emailed them April 14. He tried to rebut claims about water and electricity use and emphasized the jobs and property tax revenue. “This data center project is going to be located somewhere,” he wrote. “If it’s going to be somewhere, it should be here.”
But asked the next day if there had been more progress with the developers, Brisbois said: “It’s gone dead quiet.” He adjusted the chances of landing the data center back to less than 50-50.
“I don’t know that I’ve ever had one (developer), after they were hot to trot, and then they went cold, and then they come back and they’re hot to trot,” he said, admitting that despite his optimistic nature, he was a bit deflated. “I don’t think I’ve ever had one of those yet. But we’ll see.”
Meanwhile, the opposition was doing more than rallying.
In Cassville, home to Nelson Dewey State Park, named after Wisconsin’s first governor and a longtime Grant County resident, the town board approved a data center moratorium. That was significant for a town that previously had no zoning regulation.
Following Cassville’s lead, several Grant County towns and the County Board adopted data center moratoriums. Lawmakers proposed legislation for statewide regulation. The state Public Service Commission moved to require data centers to pay the cost of generating and transmitting the electricity they would need. And gubernatorial candidates from both parties were vowing to protect communities from data centers.
Meanwhile, Brisbois continued to call the developers, with no luck. His daughters told Brisbois they were “ghosting” him — like a person who doesn’t want to go on a second date.
“When people go quiet like this, it’s an indicator to me that the project is not moving forward, or at least their interest is waning,” Brisbois said in late-April.
“Historically, that has been a very common practice in my industry. They just fade away.”
Brisbois admitted he was turning more attention to other projects and feeling disappointed.
“I put a lot of time into this and lost a lot of sleep over it,” he said at the time. “It stings a bit. I don’t know that it’s done-done. But I’m pretty calloused over by now.”
‘Very little due diligence’
Brisbois acknowledged he did “very little due diligence” into the developers, saying he had limited ability to background check out-of-state residents.
He said that left him feeling vulnerable.
“I’m making a leap of faith,” he said. “But I do that all the time. I’m assuming that a business has the financial means to pull this off.”
“It’s not my job to really scrutinize — OK, you’re a good candidate versus … you’re not qualified,” he continued. “I don’t necessarily have the resources to do that, I’m a one-person show.”
Newspaper clippings and posters hang in the office of Grant County Economic Development Corp. Executive Director Ron Brisbois, June 4, 2026, in Lancaster, Wis. (Joe Timmerman / Wisconsin Watch)
By late May, the proposal seemed like only a memory. No return phone calls. Nothing scheduled, even as opponents continued public protests.
It’s possible the developers will never announce whether or where they’re building a data center. But Brisbois expressed no regrets.
“I felt that the project certainly has its merits,” he said, “and certainly was worth pursuing.”
Wisconsin Watch is a nonprofit, nonpartisan newsroom. Subscribe to our newsletters for original stories and our Friday news roundup.
We Energies this week asked Wisconsin’s Public Service Commission to revisit its recent ruling on electrical rates for the utility’s data center customers, arguing new credit rating requirements create an undue burden for data center operators.
The PSC approved We Energies’ “very large customer” rate structure in April, requiring the utility to exclusively bill data center customers for new energy generation infrastructure needed to serve them, among other protections for existing ratepayers. The agreement also requires data center developers with credit ratings below A- to post financial guarantees, either in cash or lines of credit, to reduce the risk of shifting costs to other customers if a developer runs into financial trouble.
That requirement poses a problem for Oracle, which is partnering with OpenAI and Vantage to develop a vast data center campus in Port Washington.
The cloud computing giant currently holds a BBB credit rating — a tier below the A- bar set by the PSC, but still considered investment-grade by ratings agencies — largely due to aggressive borrowing to finance new artificial intelligence infrastructure. Under the current rate structure, the Oracle subsidiary involved in the Port Washington project would need to provide cash deposits or letters of credit exceeding $100 million per year to receive We Energies service.
“If the Commission does not reopen its decision on this issue, the implications for Wisconsin would be significant and limit the ability of numerous investment-grade companies to invest in Wisconsin,” the utility’s attorneys wrote in a June 10 filing.
Several other major technology companies — including Intel, Tesla and Micron — hold BBB credit ratings, the attorneys noted.
Ratepayer advocates backed credit limits for data center developers during the PSC’s deliberations on the case. In written testimony to the PSC in January, Wisconsin Citizens Utility Board chief economist Steve Kihm pointed to energy trading giant Enron, which held a BBB credit rating just a year before its 2001 bankruptcy, as a reason to be cautious with financial commitments from high-dollar investors.
In its request to reopen the case, We Energies argued that the risks of Oracle or other tech giants defaulting on obligations are extremely low.
“Tens of billions of dollars in Oracle’s value would need to be destroyed before creditors and counterparties, such as Wisconsin Electric and its other customers, could experience losses,” the utility’s attorneys wrote. Even in a bankruptcy, they added, generators built to serve data centers “will still have value and will be able to provide electricity to other customers” — as opposed to a scenario in which the generators sit idle while solvent ratepayers cover the debts We Energies incurred to build them.
We Energies and Oracle asked the PSC to consider a stepped approach to security requirements that eases the burden on companies with “investment-grade” credit ratings, including BBB ratings, and to waive the Oracle subsidiary’s financial backing obligations. The utility argued that its proposed waiver would still offer greater protections than those required from Meta in its recent agreement with Wisconsin Power and Light, a subsidiary of Alliant Energy.
But Union of Concerned Scientists energy analyst Maria Chavez pointed out that We Energies’ arrangements with new hyperscale data center customers differ from Meta’s one-off service agreement with Alliant. Meta isn’t “specifically asking for extra generation capacity assets to be added,” she said, whereas the Port Washington data center campus — and Microsoft’s data center in Mount Pleasant — will require new, dedicated energy sources.
“The greater risk to ratepayers,” she added, “the more reason to have a high standard for financial security requirements.”
We Energies and Oracle urged the commission to “move quickly” on the issue to “provide certainty for generational investments that are currently moving forward in this state.”
About 100 community members joined developers and city officials inside the former Walmart at 5825 W. Hope Ave in Milwaukee. Alderman Mark Chambers of District 2 called the meeting to give residents a closer look at the development. The heavy humidity inside added to the tension as residents shared their opposition to the project. The development will include a data processing and computer research facility in the building’s rear and self-service storage, taking up most of the building. Many residents opposed both. The city of Milwaukee says those commercial uses are contingent on first developing housing and greenspaces nearby. #wisconsinwatch#milwaukeenns#datacenter#milwaukee
About 100 community members joined developers and city officials Wednesday inside the long-vacant former Midtown Walmart at 5825 W. Hope Ave. in Milwaukee. Ald. Mark Chambers called the meeting to give residents a closer look at redevelopment plans for the site. Heavy humidity inside the building added to the tension as residents voiced opposition to parts of the proposal.
Supporters say the project offers a realistic path to redeveloping a property that has sat empty for a decade. Opponents argue the site should prioritize housing and community uses over storage and technology infrastructure. City officials say the commercial components cannot move forward unless affordable housing and green space are developed first.
As Milwaukee Neighborhood News Service previously reported, most of the 160,000-square-foot former Walmart is proposed to be a climate-controlled, self-service storage facility, with additional spaces in the front for a new location for the Capitol branch of the Milwaukee Public Library and other community space that could be used by the city of Milwaukee.
Meanwhile, up to 19,000 square feet would be used for a data processing/computer services/computer research facility, according to project documents. The City Plan Commission approved an affordable housing project in the parking lot north of the building in April.
“The property has been vacant for 10 years,” said Chambers Wednesday over shouts from the crowd. “This is finally an opportunity … to finally turn a once-blighted property into something that is valuable to the community.”
Trent Overhue, the property owner and developer, said he’s been trying to develop the site for four years. “I can’t get anybody to come in here.”
City officials and developers emphasized that this wasn’t a data center like the massive one in Port Washington or other hyperscale AI data centers.
Calling it “a little bitty facility,” Overhue said the proposed IT center would require 7 megawatts of power.
For comparison, Meta’s planned data center campus in Beaver Dam is expected to use 220 megawatts at peak demand — less than half the projected power use of the large campuses planned in Mount Pleasant and Port Washington. One megawatt of energy can power anywhere from a few hundred to a thousand homes a day, depending on where, when and how electricity is used.
Resident Kellie Momon said she’s “elated” by plans for a library, makerspace and affordable housing in the area.
“But why do we have to have storage taking up so much of that space that could be used for more affordable housing — more community things?” she said. “Why is that even part of the plan? Why do we have to have a data center?”
Meredith Melland contributed to this report.
Wisconsin Watch is a nonprofit, nonpartisan newsroom. Subscribe to our newsletters for original stories and our Friday news roundup.
A dozen Wisconsin state lawmakers are urging the Federal Energy Regulatory Commission to reject a utility coalition’s request to pause competition for major electrical transmission projects in the Midwest.
The lawmakers — eight Assembly Republicans and four Senate Republicans — argued in a letter to the commission that competition for electrical transmission is a net positive for ratepayers, who stand to benefit from lower costs and increased innovation. That outcome, lawmakers wrote, “is even more urgent today given the rising issue of customer affordability.”
The utilities requesting a pause dispute whether competition truly lowers final costs for customers, but that argument is secondary to their primary concern: Powering the Midwest’s data center boom will require vast electrical transmission upgrades, and major regional utilities argue that competition only slows down projects needed to bring data centers online before international competitors overtake the U.S. in the artificial intelligence race.
Among the utilities behind the request are Xcel Energy, owner of Northern States Power Company-Wisconsin, and American Transmission Company (ATC), Wisconsin’s largest electrical transmission operator.
The state lawmakers cast the utilities’ request as the latest stage of a long-standing fight over transmission market competition — one that has unfolded in the Assembly over the last five years.
Data center boom intensifies transmission competition
Ratepayer advocacy groups successfully lobbied FERC, which oversees utilities nationwide, to introduce competitive bidding for regional transmission projects in 2011, arguing that the previous model — allowing local monopolies to build all projects planned within their territories — all but guaranteed inflated costs.
The shift triggered a nationwide gold rush for transmission projects. Regulators pre-approve developers’ “return on equity,” or profit on each dollar invested, for transmission construction, so winning a project means picking up a reliable revenue stream.
Dozens of developers have since bid on transmission projects planned by the Midcontinent Independent System Operator (MISO), the nonprofit that manages the wholesale electricity market for much of the Midwest. MISO has approved more than $32 billion in new transmission projects since 2022 — projects largely planned before the region’s data center boom reached full swing.
The rush to win projects has placed well-established local utilities like ATC in competition with powerful national utilities venturing outside of their traditional territory, international developers venturing into the U.S. market, and startups backed by private equity firms.
As data center developers rapidly scale up Midwest operations, the pace of transmission upgrades could become a choke point.
In March, MISO reversed its decision to award substations in Fond du Lac, Ozaukee and Sheboygan counties to private-equity-backed startup Viridon, instead handing the projects to ATC.
ATC’s initial bid was more expensive than Viridon’s, but the company successfully argued it alone could build the substations in time to serve the nearby Vantage data center campus in Port Washington. Viridon had not yet secured Public Service Commission permission to operate in Wisconsin — a hurdle ATC does not face.
MISO initially aimed to complete the substations by 2033; the Port Washington data center plans to come online in early 2028. Though ATC emerged victorious, it told FERC that the 15-month delay between MISO’s initial approval of the substations and the reversal was “completely unnecessary.”
Utilities say competition slows projects needed for AI growth
In the utility coalition’s initial request to FERC, it cast competition-related delays as a national security threat.
“These projects — expressways for power — are as critical to meeting today’s challenges as the Eisenhower interstate highway system was to prevailing in the Cold War,” the utilities argued in their initial filing. “China has devoted itself to overtaking America as the world’s AI leader and is just months behind.”
In this video, Paul Kiefer explains why Wisconsin’s grid buildout is a “gold rush” for utility companies.
The utility coalition proposed two options: Allow MISO, along with the grid operator for parts of the Great Plains and Southwest, to exempt transmission projects from competitive bidding on a case-by-case basis or suspend competition entirely for the next five years — “when our country must begin building the infrastructure that will decide which nation wins the AI race,” the utilities wrote.
Ratepayer advocacy groups immediately pushed back. Paul Cicio, chair of the nationwide Electricity Transmission Competition Coalition, called the request “tone deaf.”
“Suspending competition for five years,” he wrote in a press release, “would expose consumers in these regions to unchecked cost escalation for years, guaranteeing higher utility bills.”
In a protest filed with FERC in late May, Wisconsin’s Citizens Utility Board pointed to the Cardinal-Hickory Creek transmission line in southern Wisconsin as an example: The 102-mile project was not subject to competitive bidding, and construction costs came in roughly 40% over budget by the time ATC, Dairyland Power Cooperative and ITC Midwest completed the line in fall 2024.
Opponents of the utilities’ request recognize that the data center boom complicates the playing field for transmission competition.
“Timelines are looking different than the industry is used to,” said Caitlin Marquis, managing director of Advanced Energy United, a trade group representing an array of clean energy and energy efficiency industries. “Transmission competition has been facing curveballs and challenges since it was introduced,” she added. Many challenges result from lobbying by incumbent utilities, and data centers’ speedy construction cycles are only the latest addition.
Her organization opposes the utilities’ request, arguing that incumbent utilities have a long track record of delaying non-competitive transmission projects — and that regulators should streamline the bidding process rather than forego competition entirely.
But utilities argue competitive bidding has yet to prove its worth. While MISO generally favors lower-cost bids, an ATC spokesperson wrote in an email to Wisconsin Watch, “evidence of a low bid is not evidence of cost savings.”
Bid prices often do not match the final project cost, they added, and substantial overruns are common, even on projects with competitive bidding.
Federal fight echoes years of debate in Wisconsin
As regional grid operators introduced competitive bidding for transmission projects a decade ago, utilities turned to state legislatures for right-of-first-refusal, or ROFR, laws.
Those laws give local utilities first dibs on transmission projects within their territories, including those planned by regional grid operators like MISO.
Michigan and Minnesota adopted such policies; Iowa’s Supreme Court struck down a ROFR law in 2023.
Construction unfolds at the 350-plus-acre Beaver Dam Commerce Park, the site of a Meta data center, Jan. 20, 2026, in Beaver Dam, Wis. (Joe Timmerman / Wisconsin Watch)
Utilities have backed similar proposals in Wisconsin each year since 2021, including a 2025 bill introduced by outgoing Assembly Speaker Robin Vos, R-Rochester.
Those proposals would have “insulat(ed) incumbents from market discipline” and left ratepayers holding the bag, the Wisconsin lawmakers argued to FERC.
“Having failed repeatedly to persuade the Wisconsin Legislature,” they continued, “the same incumbent entities are now pursuing an end-run at FERC.”
ATC maintains that options before FERC would “not operate as a substitute” for a ROFR law, “even temporarily.”
The utilities don’t stand alone before FERC. The International Brotherhood of Electrical Workers, a union representing the tradespeople who build and maintain transmission lines, also backs the request to pause competition.
Editor’s note: This story was updated June 4, 2026 to include comments from Caitlin Marquis, managing director of Advanced Energy United.
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Wisconsin regulators on Thursday approved a one-off contract between Alliant Energy and the Meta subsidiary building a data center campus in Beaver Dam, but with a major caveat: Alliant must return with a standardized plan to power future data centers — and shield other customers from resulting costs.
The agreement bears little resemblance to the model We Energies proposed for its hyperscale data center customers in Mount Pleasant and Port Washington. That model covers all future We Energies data center customers and was approved last month with major modifications by the three-member Wisconsin Public Service Commission (PSC).
Both the PSC and ratepayer advocates expressed reservations about allowing Alliant to proceed without a standardized payment structure for data center customers. Negotiating contracts one-by-one, Commission Chair Summer Strand argued, would undermine the public’s interest in transparency and consistency.
Strand and fellow commissioners Kristy Nieto and Marcus Hawkins approved a modified version of the agreement, acknowledging that the Beaver Dam campus will open in 2027 with or without a tailored contract with Alliant. Sending the utility back to the drawing board for another year, they reasoned, could expose other customers to greater financial risk. The commissioners directed Alliant to propose a standardized payment structure for large data center customers similar to the We Energies arrangement approved last month.
Wisconsin Power and Light, an Alliant subsidiary, filed its case with the PSC last spring, months before Meta joined state and local officials in announcig its Beaver Dam data center campus.
The Beaver Dam facility, the first of its kind in Alliant’s Wisconsin service territory, is smaller than the soon-to-open Microsoft and Vantage data centers. Meta projects the facility will use 220 megawatts at peak, less than half the projected use of the Mount Pleasant and Port Washington campuses. But even that comparatively modest demand would be six to eight times the current peak for all of Beaver Dam.
In testimony to the PSC in November, Rebecca Valcq, Alliant’s assistant vice president for regulatory affairs and data center services, said the Beaver Dam campus would benefit other customers by “making more efficient use of existing infrastructure” and “spreading fixed costs” across a larger base. She also urged commissioners to consider the data center’s projected $2.1 million in annual local, state and federal tax revenue, among other economic benefits.
Alliant is a founding member of the Wisconsin Data Center Coalition, which promotes the state as a destination for data center developers.
Unlike We Energies, Alliant says it does not expect to immediately build new power plants to serve the Beaver Dam campus. Instead, Meta would purchase electricity from the same generators as the rest of Alliant’s customers. Hawkins noted on Thursday that even if the new data center doesn’t immediately require new generators, it might change the retirement timelines for Alliant’s existing power plants.
Contract negotiated in secret
The utility negotiated its contract with Meta behind closed doors. When it approached the PSC, it asked for approval without changes and requested extensive redactions, hiding many contract terms from the public. Alliant argued that the contract’s specific terms, and the surrounding secrecy, were needed to “attract and accommodate” Meta — and to compete with other states or utility territories courting data center development.
The redactions spurred pushback from ratepayer advocates and the PSC itself, which made more details of the contract available as the case progressed. In Thursday’s hearing, Strand drew parallels with the nondisclosure agreements some data center developers seek from local governments in Wisconsin, including Meta in Beaver Dam, which Wisconsin Watch first reported on in January.
“For some of these new private sector, big tech data center customers that are used to operating confidentially, coming into our state or coming into this process might be a shock to the system,” Strand said. “There is still this black-box approach that includes nondisclosure agreements, heavily redacted filings, corporate pseudonyms and negotiations shrouded in secrecy… This lack of transparency is hurting, not helping.”
The nonprofit law center Midwest Environmental Advocates in December sued the PSC to obtain unredacted documents from the Alliant case. That lawsuit is ongoing.
PSC adds protections, warns of gaps
Alliant proposed some protections for itself and non-data center customers. It set a floor for Alliant’s revenues from Meta, protecting the utility in a scenario in which the data center uses less electricity than initially anticipated.
That minimum covers the cost of building transmission lines to serve the data center. The American Transmission Company, the largest transmission operator in Wisconsin, is currently building a $200 million line to plug in the Beaver Dam campus.
Construction unfolds at the 350-plus-acre Beaver Dam Commerce Park, the site of a Meta data center, Jan. 20, 2026, in Beaver Dam, Wis. (Joe Timmerman / Wisconsin Watch)
Alliant also proposed requiring Meta to reimburse the utility for the costs of transmission infrastructure if the tech giant backs out of the Beaver Dam project before the new line is complete — and requiring Meta to put up collateral in case its credit rating falls.
The PSC agreed with those terms and added further protections, including requiring Alliant to regularly report on the costs of serving the Beaver Dam campus and leaving the door open for the commission to adjust the cost-sharing to shield other customers from unanticipated expenses.
Commissioners identified some ratepayer protections beyond what it has authority to require. The transmission buildout needed to serve data centers is largely outside of PSC jurisdiction. Much of that authority instead rests with the Federal Energy Regulatory Commission (FERC), which oversees transmission utilities nationwide, and the Midcontinent Independent Systems Operator (MISO), a nonprofit that manages much of the Midwest’s electrical grid.
MISO awarded the transmission line project that will serve the Beaver Dam data center to ATC, which spreads construction costs across all its Wisconsin customers, most of whom are outside Alliant’s territory. While Alliant’s new contract requires Meta to pay a minimum transmission fee to shield other Alliant customers from unexpected costs, those protections don’t extend to customers of other utilities using ATC’s transmission lines.
Alliant’s customers will also pick up “tens of millions of dollars” in transmission costs tied to data centers in other Wisconsin electrical utility territories, Hawkins said. “Whether or not that is appropriate — or something that we are being open-eyed about — is a concern of mine,” he added.
Commissioners on Thursday urged Alliant to begin discussions with ATC on a fairer method for distributing costs — one of the few options within commission authority.
The commission directed Alliant to produce a standardized plan before making agreements with new data center customers.
The PSC is aware that more data centers could come to Alliant’s turf.
“Evidence indicates there are 12 other potential data centers in this utility’s territory that are potentially in the works,” Nieto said. Given that future, she added, Alliant must “establish clear rates, terms and protections and provide transparency, regulatory clarity and public accountability as required when serving loads capable of reshaping a utility’s entire system.”
Ratepayer groups say PSC sent clear message
Ratepayer advocates welcomed Thursday’s decision while emphasizing the importance of the directive to outline a standardized payment structure for future data centers.
“While the PSC approved Alliant’s contract, with modifications, for Meta’s Beaver Dam data center, the Commissioners recognized that continued one-off, bilateral contract negotiations are not sufficiently protective of Wisconsin families and small businesses,” Brett Korte, a staff attorney with Clean Wisconsin, said in a press release.
“Today’s PSC decision requiring Alliant to develop a tariff for future data centers will result in a consistent, transparent framework that helps protect the public interest.”
Wisconsin Citizens Utility Board Executive Director Tom Content echoed commissioners’ hopes that Alliant and other electrical utilities will reach an agreement with ATC to protect non-data center customers from transmission-related cost shifts.
“We’re calling on ATC to protect customers across Wisconsin and Michigan to make sure people who aren’t even (customers of) these utilities aren’t on the hook,” he told Wisconsin Watch.
Alliant raised no immediate objections to the PSC’s changes.
“Protecting our customers while allowing communities to grow is central to our commitment at Alliant Energy, and that’s exactly what this contract is designed to do,” a spokesperson wrote in a statement on Thursday afternoon. “It maintains reliability, supports meaningful local economic benefits, and delivers benefits that help keep rates stable for all customers.”
In a quarterly earnings call last week, the company announced plans for a 370-megawatt electric service agreement with a data center customer in Iowa. Unlike Wisconsin’s PSC, Iowa’s utility regulator has been more open to one-off contracts between utilities and data centers.
By removing that option for Alliant’s future arrangements with data center customers, Content said, the PSC’s latest ruling could set a new standard for other utilities in the state.
“They’re sending a message,” he added. “None of this individual contract stuff.”
An attorney read from a laptop propped atop a snowplow.
To his left was a Caterpillar street grader, and to his right, a dusty workbench. A disheveled American flag hung next to a red toolbox in the center of the impromptu stage.
Dozens of southwest Wisconsin residents recently forsook part of the local high school’s track-and-field meet so they could cast their votes inside the town of Cassville’s garage. The attorney had been retained by the town’s elected leaders to read the soon-to-be-newest regulation.
The unanimous outcome — 44 ballots in favor of banning data centers, none against — reflected a hostile backlash to unwelcome big tech incursions into rural spaces.
Residents instructed their town board to put a stop to the billion-dollar proposal by an anonymous developer after learning their community was on the short list.
The pastoral landscape — known for rolling bluffs that straddle the locks and dams of the nation’s upper Mississippi River — possesses a bountiful aquifer, a temperate climate and few land regulations.
The latest move against data centers
Cassville’s ordinance is the latest move by a Midwestern community seeking to protect the qualities that make life so appealing to people — and data centers.
Pushback over the power-hungry facilities that make the cloud run are occurring across the country, as companies expand in states like Mississippi and Tennessee.
Residents in Port Washington, Wisconsin, were the first in the nation to pass a referendum that would prevent their city from offering generous tax incentives without first obtaining voter approval.
And in Clayton County, Iowa, directly across the river from Cassville, officials are considering zoning, setback and size restrictions.
Cassville residents fear data centers will devalue their properties, contaminate their wells and increase their electric bills.
“This is the Driftless area for Christ’s sakes,” said John Hawn, who retired to the area several years ago. “I suppose they didn’t expect any problems coming into a small town.”
‘There’s no information’
The Cassville project has been shrouded in secrecy. That includes the proposed location and what company will use it, leaving residents to fill in the vacuum with a frenzy of social media engagement.
“I don’t know really what to think about it because there’s no information,” town Supervisor Scott Riedl said.
Ron Brisbois, executive director of the Grant County Economic Development Corp., has met with a developer but to date declined to identify the company that is scouting for locations so as not to jeopardize the project.
In an interview after Cassville’s vote, he said the town’s appeal is its proximity to electricity, specifically the high-voltage Cardinal-Hickory Creek transmission line that entered service in September 2024.
Brisbois estimated the data center would require 400 to 500 megawatts of power — a lot, even by the new transmission line’s standards.
But the town’s attorney, Eric Hagen, said if Cassville can make it inconvenient, the data center developer may look elsewhere. The company also is considering sites in Indiana and North Dakota.
“My read of the situation right now: They’re looking for the lowest-hanging fruit with the least amount of regulations,” Hagen said.
Cassville’s new ordinance prohibits data centers in the town for up to two years and prevents land use changes, such as constructing a residence on a farm field, without the town board’s approval. And the county cannot preempt local zoning authority in the town’s case, Hagen said.
“We can beat them to the punch.”
Data centers raise ire
Days after the town’s vote, Brisbois fielded questions from a concerned public at J&J’s Sandbar, a Cassville restaurant, over chicken and ham, mashed potatoes with gravy and macaroni salad.
He wonders whether the objections reflect data centers’ tarnished image more than concerns over actual water and power use. If a battery or farm equipment manufacturer were to move in and consume more of each, would residents even notice?
Brisbois said the developer has remained quiet for the past month, which he attributes to the lack of local tax incentives for the project rather than community unease.
“I’m looking forward to a bit quieter days,” he said, “where all I have to worry about with townships is housing and maybe an ag or a farm expansion.”
Wisconsin Watch is a nonprofit, nonpartisan newsroom. Subscribe to our newsletters for original stories and our Friday news roundup.
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