New UCS Report: Powering Michigan Data Centers with Clean Energy Could Avoid Billions in Climate, Health Costs

CHICAGO (January 21, 2026)-Data centers are coming to Michigan, requiring massive amounts of electricity at a time when household bills are already on the rise. More clean energy is needed to bolster Michigan's electricity grid as data centers are widely expected to reshape the energy landscape in the coming years. A new report released today by the Union of Concerned Scientists (UCS) highlights the effects of data centers' growing electricity demand on Michigan's power grid and how decisionmakers can mitigate harmful impacts on people and businesses by driving more clean energy development and adopting stronger ratepayer protections in the state.

The report, "Data Center Power Play," assesses the potential costs of meeting data center load growth over the next 25 years and the consequences for climate and health. Since future data center demand growth is highly uncertain, largely due to a lack of transparency from utilities and Big Tech companies, UCS modeled multiple demand growth scenarios as well as energy policy scenarios for how that demand is met.

A state-specific fact sheet shows that in Michigan, data centers will account for 40% of electricity demand growth by 2030 in its mid-level data center demand growth scenario. Without better ratepayer protections, over the next 25 years such data center growth could put Michiganders at financial risk of $18 billion in additional electricity systems costs, UCS reports.

Absent stronger policies, data center load growth will lead to worsening pollution from Michigan's fossil fuel power plants and rapidly escalate the amount of fossil-generated electricity the state exports to its neighbors. UCS calculated mid-level data center growth could also lead to more than 25 million metric tons of carbon dioxide emissions by 2035 largely due to a reliance on fossil gas to power them. This would nearly double the emissions of the state's entire industrial sector compared to a 2021 baseline.

Conversely, the UCS analysis shows that by adopting more robust state and federal clean energy policies to meet this demand, Michigan would see the economic benefits of more clean energy development and deliver $3.5 billion in health savings and avoid $408 billion in global climate damages between now and 2050.

"Michigan urgently needs a strategy to preserve reliable, affordable electricity and clean energy growth as more data centers are built," said Lee Shaver, report author and senior energy analyst at UCS. "One electric utility, DTE, recently signed a contract with a 1.4-gigawatt data center planned to begin construction in Saline Township this year. If completed, the project will increase the utility's existing load by 25%-equivalent to the electricity demand of over a million new homes. While several major utilities are actively developing new contract terms to address these unprecedented 'large loads,' policymakers and regulators must also implement safeguards to meet data center demand with clean energy resources while protecting consumers from added costs. Our electricity system should prioritize the needs of Michigan communities and ensure the state continues its progress toward a clean, healthy future."

You can read about national-level findings here, as well as related blog posts here. UCS also released state fact sheets for Illinois and Wisconsin alongside the national report.