Data centers are physical facilities that store, process, and transmit digital information. They support services Michiganders use every day, including email, online shopping, streaming, social media, artificial intelligence (AI), hospitals, emergency services, business operations, scientific research, and other digital technologies.
This page provides information about the State of Michigan’s role in holding data center projects accountable for being good neighbors and stewards of our precious environment. This page also provides information about applicable permits and resources for applicants, communities, and local governments.
As local communities consider proposals from data center developers across Michigan, questions often arise regarding electricity costs and reliability, water use, environmental impacts, infrastructure needs, jobs, taxes, permitting requirements, and local quality of life.
In order to do business in the state of Michigan, data centers must adhere to some of the strictest standards in the country when it comes to protecting our environment and protecting Michiganders’ pocketbooks. State agencies regulate electric service, water withdrawals, air emissions, wastewater, wetlands, construction, and other aspects of data center development, while local governments have authority over land use and community impact.
Recently, Governor Whitmer issued the Michigan Affordability and Responsible Growth Pledge which builds on our existing rules and regulatory protections to help ensure companies are good partners and neighbors. By signing this pledge, the companies agree to invest in the electric grid, use clean energy, hire Michiganders, safeguard our natural resources, operate transparently, and bear the full cost of data center construction, operation and service, so Michigan residents do not pay a single penny.
The following companies have signed the Michigan Affordability and Responsible Growth Pledge:
A data center is a facility that stores, processes, and transmits digital information. Data centers house servers and other computing infrastructure necessary for building, operating, and delivering applications and services. These centers support cloud computing, artificial intelligence (AI), websites, streaming, business operations, scientific research, and many other everyday digital services. By concentrating computing, storage, and networking infrastructure in shared facilities, data centers can support large-scale computing and serve many users and organizations at the same time.
No. Data centers vary significantly in size, design, purpose, computing capacity, cooling technology, water use, and electricity demand. Some primarily serve a single company, while others provide cloud or location services to many customers at once. A small enterprise data center may have very different infrastructure needs and environmental impact than a large hyperscale campus, so the regulatory requirements of a project depend heavily on its size, design, and location.
The State of Michigan does not maintain a map for data centers in Michigan. You can explore these third party maps to learn more about permitted, existing, and proposed data centers in Michigan.
The FracTracker's U.S. Data Centers Tracker map provides an in-progress tally of permitted, existing, and proposed data centers in the United States.
The Michigan Department of Environment, Great Lakes, and Energy’s (EGLE) role is to administer environmental protection laws and regulations that may apply to project construction and operation.
Depending on project design and location, EGLE review may include:
Not every project requires every permit. Applicable reviews depend on site conditions, project design, and operational characteristics. Learn more on the EGLE data centers and environmental review webpage.
The Michigan Public Service Commission has adopted some of the strongest safeguards in the country to ensure families, small businesses and others don’t end up paying more for electricity because of large data centers.
The Michigan Public Service Commission’s protections require data centers to commit to long-term contracts and pay for a minimum amount of electricity whether they use it or not. If a data center doesn't grow as expected or leaves town, other customers won’t be stuck with the bill. These protections are in addition to state energy laws that already prevent utilities from charging residential customers to cover costs that should be paid by business customers. Adding data centers is expected to lower electricity rates in Michigan because large new customers help spread out the fixed costs of operating the power grid.
With 520,000 Michigan jobs and approximately 45,500 annual openings in the professional trades projected by the year 2032, data centers not only sustain jobs in construction, but follow a lifecycle of continuous upgrade and expansion, leading to new rounds of construction and skilled labor deployment.
Beyond initial build, Michigan data centers would support ongoing job cycles in construction, electrical, and mechanical trades approximately every 4–6 years — extending local employment benefits well beyond project opening and typical operation staff.
Data centers create more than construction jobs; they strengthen Michigan's long-term skilled trades workforce. For examples, supporting construction of a seven-building data center campus could add 500 new electricians to Michigan’s workforce over five years and support the training of 14 new instructors, expanding capacity to meet future demand across infrastructure, manufacturing, and energy projects.
Data centers provide an opportunity to both prepare for and continue training a skilled workforce. It will be critical to increase the number of Registered Apprenticeship outreach and engagement events to specific electrician occupations to increase the number of new programs, and to expand existing Registered Apprenticeship programs.
In turn, this provides more stable, good-paying jobs – Michiganders who complete a Registered Apprenticeships have a 94% retention rate and more than $90,000 annual salary one year after program completion.
Continued investment with partners including labor organizations and Michigan Works! Agencies will support employers’ expansion of Registered Apprenticeships.
The Michigan Department of Licensing and Regulatory Affairs (LARA) plays several roles in the development and operation of data centers in Michigan. Through multiple bureaus, LARA helps ensure data centers are constructed safely, businesses are properly registered to operate in the state, and applicable building and fire safety requirements are met.
LARA establishes and administers Michigan's statewide building codes, oversees building plan review and permitting in jurisdictions where the state has enforcement authority, maintains records of businesses authorized to operate in Michigan, and provides guidance on applicable fire and life safety requirements. Depending on the location of a project, local governments may also have permitting and code enforcement responsibilities.
The LARA Bureau of Construction Codes requires plan review and construction permits through the governmental jurisdiction with building code authority for the construction of a data center.
The LARA Bureau of Fire Services may require additional permits depending on the municipality. Local fire departments may also participate in site plan review, zoning review, building plan review, and fire protection system review.The LARA Bureau of Construction Codes maintains the statewide jurisdiction list and updates it regularly. All units of government are listed by county, and the list identifies the jurisdictional authority for building, electrical, mechanical, and plumbing code enforcement.
The LARA Bureau of Fire Services does not maintain a record of locally adopted fire codes. Local municipalities may adopt and enforce their own fire codes.
The LARA Bureau of Construction Codes classifies data centers based on their use, hazards, and risk because the Michigan Building Code does not explicitly assign them to a specific occupancy group. Data centers have commonly been classified as Group B (Business), Group F-1 (Moderate-Hazard Factory Industrial), or Group S-1 (Moderate-Hazard Storage). Each classification carries different implications for allowable area and height, means of egress, fire protection systems, and other life safety features.
The LARA Bureau of Fire Services works within the requirements of the Michigan Building Code and applicable fire codes. While the building code establishes general construction requirements, local municipalities may have adopted fire codes that establish additional requirements for fire department operations, including fire hydrants, fire flow, apparatus access, standpipes, emergency planning, fire protection systems, hazardous materials, backup power systems, and emergency responder safety.
In general, BFS is responsible for public assemblies, state-owned buildings, and other licensed facilities where it has statutory authority. Data centers generally fall under local jurisdiction unless they meet one of those requirements.
The LARA Bureau of Fire Services references nationally recognized standards developed by the International Code Council (ICC) and the National Fire Protection Association (NFPA), including:
The LARA Bureau of Fire Services (BFS) requires plan review, inspection, and permitting for aboveground and underground fuel storage tanks used to support backup generators before they are placed into service.
The LARA Corporations, Securities & Commercial Licensing Bureau maintains Michigan's official registry of business entities through its Corporations Division. The business entity that owns, operates, or supports a data center may be required to register or qualify to transact business in Michigan, depending on where it was formed and the activities it conducts within the state.
The LARA Corporations, Securities & Commercial Licensing Bureau provides public access to business information, including an entity's legal name, resident agent, registered office address, status in Michigan, officer information for corporations, assumed names, and filed business documents.
The Michigan Department of Transportation (MDOT) does not approve or deny data center projects as a whole and does not determine where facilities are located. MDOT’s role would involve permitting and roadway improvements to a facility if located on a state trunkline highway (I, M or US routes).
The Transportation Economic Develop Fund (TEDF) Category A (target Industries) program provides funding for road improvements critical to targeted economic development. Traditional data centers are not eligible; however, “hyperscale” data centers (generally associated with artificial intelligence, or AI, training and inference) may be eligible depending on their actual activities and the level of new private investment and job creation.
Yes. Like any business or industry, Michigan Department of Transportation (MDOT) permits access to the state highway right of way, which includes points of ingress/egress, drainage into the highway right of way, and utility permitting within the right of way (e.g., electric power, communications, etc.).
When a proposed project has a federal nexus, Michigan Department of Transportation (MDOT) will prepare environmental clearance or partner with the federal agency with jurisdiction over the project proposal, under the Nation Environmental Policy Act (NEPA). A federal nexus occurs when a project has federal assets or funding involved in the project, such as:
As more Michigan communities consider proposals from data center developers, MEDC has gathered useful information on best practices and relevant policies, including perspectives from our regional and utility partners. These resources are intended to support community planning and considerations around data centers and similar projects, both under active development and as potential opportunities.
MEDC also administers the Enterprise Data Center Sales and Use Tax Exemption along with the Michigan Department of Treasury.
The Enterprise Data Center Sales & Use Tax Exemption went into effect April 2025. It eliminates Michigan's 6% sales and use tax on eligible data center construction and equipment purchases. This requires capital investment of at least $250 million, job creation of at least30 qualified new jobs with an annual wage of at least 150% of the prosperity region median wage. Those jobs must be maintained through December 31, 2050 (December 31, 2065, for brownfield sites or former power plant sites) and no new certifications will be issued after December 31, 2029. Learn more about the Enterprise Data Center Sales & Use Tax Exemption.
MEDC offers a tested, repeatable process for Michigan communities that want to be ready for development of any kind, including planning for new investment and reinvestment, identifying assets and opportunities, and focusing limited resources. Over 80 communities across the state have been certified as Redevelopment Ready Communities.
The RRC Online Library provides communities seeking to build strong planning processes with step-by-step guidance for many aspects, from plan reviews to packaging priority redevelopment sites, including the best practices handbook.
Learn more about Redevelopment Ready Communities and the RRC Online Library.
Michigan’s data center sales and use tax exemptions fall into two main categories:
For both QDCs and EDCs, the exemptions apply only to certain tangible personal property and construction materials that fit within the definition of “data center equipment” under MCL 205.54ee(10)(d) and MCL 205.94cc(10)(d).
For both QDCs and EDCs, the exemption may be claimed at the point-of-sale or, if tax was paid, a refund may be requested from Treasury within the applicable statute of limitations. For exemptions claimed at the point of sale using Treasury Form 3372, Michigan Sales and Use Tax Certificate of Exemption (3372, Michigan Sales and Use Tax Certificate of Exemption), the purchaser, must mark the box “Other” (Section 3, box 12 of Form 3372) and fill in “Qualified Data Center” or “Enterprise Data Center” on the explanation line, as applicable. Or, in lieu of an exemption certificate, the seller may obtain and retain other identifying information of the purchaser and the reason for claiming the exemption, in paper or electronic format. See RAB 2024-11 (Revenue Administrative Bulletin 2024-11).
Yes. For a QDC, the exemption cannot be claimed on sales or purchases of “data center equipment” made after December 31, 2050. For an EDC, the exemption cannot generally be claimed on sales or purchases of “data center equipment” made after December 31, 2050. However, if the EDC is located on property included in a brownfield plan under the Brownfield Redevelopment Financing Act (1996 PA 381) or on property that was once an industrial site used primarily as a power plant to generate electricity for sale, the exemption for the EDC extends through December 31, 2065. MSF may not issue any new certificates for EDCs after December 31, 2029 (sunset does not affect existing certificates in effect on December 31, 2029).
Under MCL 205.75(8)(b) and MCL 205.111(1)(d), any person claiming a sales or use tax exemption for the sale or purchase of “data center equipment” for a QDC or EDC must annually report to Treasury by filing Form 5726, Report for Qualified Data Center Exemptions (5726, Report for Qualified Data Center Exemptions). This reporting requirement did not exist before 2020 as it became effective February 13, 2020 with the enactments of 2020 PAs 29-30.
To determine the impact of the exemption on the SAF, as required by statute. The purpose is not to track data center activity or compile statistics.
Treasury typically receives 5 to 10 filings annually (2020–2024). Reported exempt purchases totaled $212 million for that period, representing less than $13 million in combined sales/use tax impact.
