On Wednesday, March 11, the Joyce Foundation, University of Virginia Weldon Cooper Center for Public Service, and the American Association for the Advancement of Sciences Center for Scientific Evidence in Public Issues (AAS EPI Center) co-hosted a webinar entitled “Economic, Fiscal, and Energy-related Impacts of Data Centers in the Great Lakes” as part of their continued assessment, Ning Lin, with the Bureau of Economic Geology at The University of Texas at Austin, and Joao Ferreira with UVA (University of Virginia) led an interactive discussion outlining investments needed to ensure sustainable clean energy use.
The Weldon Cooper Center is essential in regulating data center growth and research development
This institution is currently tracking data center growth in the U.S. to provide guidance-based evidence, serving policymakers, elected officials, governments, community leaders, and university constituents. Data center growth promotes investment in public impact research, leadership development, and local government/community engagement. Contributions in these three key capacities will advance economic well-being, understanding, and community resilience, explained by Ferreira.
Data center energy demand continues to increase
Ferreira kicked off the webinar by describing the impact the Weldon Cooper Center’s work has on tracking data center expansion in the U.S. The scale of facilities used for housing power-generating equipment varies widely, ranging from Telco data centers (large-scale centers operated by telecommunications companies such as AT&T), the size of a high school basketball court (20,000 square feet), to hyperscale data centers, one-third the size of Millennium Park in downtown Chicago (325,000 square feet). Energy needs have continued to expand as a result. Cumulative growth of data center energy requirements is assessed in five growth phases. The initial growth phase from 2000 to 2008 displayed an increase of 69 megawatts (MW) per year. Compared to the most recent growth phase in 2025 to 2029, with a projected 1,131 MW increase per year. This represents a sharp acceleration in energy demand.
Energy use varies throughout data centers across the U.S.
There are currently 2,717 operational data centers in the U.S. (S&P). Water consumption is a crucial element of data center operation, and around 20% of data centers in the U.S. are in states in proximity to the Great Lakes, with Illinois and Ohio representing more established markets. These states represent cases of rapidly increasing energy demand. Both states have displayed exponential growth since phase one. The amount of energy data centers will use in Illinois in 2029 is projected to be equal to the energy produced by the largest nuclear power plant. Other states in the Midwest are also observing a sharp increase. The largest coal power plants in Indiana and Minnesota have both produced at least 10 terawatt-hours (TWh) at any instance since 2021. Michigan and New York are not expected to experience exponential growth like other states, although new regulations and tax exemptions are expected to result in data center growth in Michigan in the near future.
Demand and growth create economic challenges and energy impacts
The energy-intensive nature of data centers requires intensive planning during development. Targeted grid planning is required to avoid transmission bottlenecks, strain in grid capacity, strain during peak times, and outages. During the event, Lin explained that without proactive investment, data center demand can increase energy requirements and drive up costs. EPA employs emissions-reduction goals for various fossil plants; energy demand from data centers may pose challenges to climate goals. Data centers also pose unique economic challenges. These facilities are largely self-sustaining, and most employment occurs during the construction phase, with relatively few operational roles. This furthers the importance of balanced incentives. Retaining local tax contributions is crucial to offsetting resource demands. These designs should be transparent as well as sustainable.
