OpenAI, Oracle, and Related Digital Announce $7 Billion AI Data Center in Michigan

Tech giants announce $7B data center, Michigan's first hyperscale campus

Michigan is poised to receive its first hyperscale data center after three tech giants revealed themselves Thursday as the developers behind a proposed 1-gigawatt-plus AI project on farmland in Saline Township. The news that OpenAI, Oracle and Related Digital will build the massive computing facility for their Stargate joint venture comes hours after officials with DTE Energy, the utility serving the Saline area, announced on a quarterly earnings call that the company had inked a deal to provide 1.4 gigawatts of power to an unnamed data center project. DTE Spokesman Ryan Lowry confirmed Thursday afternoon that the project is the Saline Township campus. Construction is slated to begin in 2026. The Wall Street Journal reported its value will top $7 billion. "I'm grateful to these cutting-edge companies for betting on Michigan, building on our work to compete for and win big projects in next-generation industries from cars and clean energy to semiconductors and batteries," Gov. Gretchen Whitmer said in a statement. Whitmer hailed the deal as "the largest economic project in Michigan history," saying it will create more than 450 onsite jobs, plus additional spinoff jobs in Washtenaw County. In 2022, General Motors announced a $7 billion investment across two factories, promising 4,000 workers. The data center proposal has drawn its fair share of pushback. After the Saline Township board voted last month against rezoning the 575-acre site for the data center, Related Digital successfully sued, accusing the township of exclusionary zoning. A settlement in that case last week, combined with the DTE deal to provide power, paved the way for Thursday's public announcement. The township's supervisor and attorney did not immediately respond to messages left by Bridge Michigan on Thursday. Township Planning Commissioner Ronald Kohler told Bridge Michigan that he originally voted against the proposal, but has grown more comfortable since developers agreed to invest some $14 million to the local community and make concessions such as on-site groundwater level monitoring wells. "I really think once it's in there, you won't even know what's there," he said. "You can't live in the horse and buggy days no more." The deal will be eligible for a sales and use tax exemption on equipment, a subsidy approved by the Legislature in late 2024. The companies also will seek a 12-year, 50% local tax abatement, according to the court settlement. House Speaker Matt Hall, R-Richland Township, noted Thursday that he voted against the data center tax breaks that have prompted a wave of interest from the tech industry. He said he'd like to see economic development officials get more upfront buy-in on projects with the potential to reshape communities. "The battery plants come in, and the public don't want them, and we're starting to see that on the data centers, too," he said. Yet the deal could signal more opportunity for Michigan during a period of rapidly changing technology, said Phil Santer, chief operating officer of Ann Arbor SPARK economic developers. After working on the Saline Township project and visiting others in the US, "we're thinking about where this can go toward an overall AI strategy for the state," Santer told Bridge. "A data center of this scale in our backyard just adds to our assets." A press release from the three companies stated that the data center campus would occupy 250 acres of the site with three buildings of 550,000 square feet apiece. The campus will use a closed-loop system to cool servers, which company officials claimed will limit the site's water use "to levels comparable to an office building." "This project will help ensure Michigan is a key part of building the AI infrastructure that will power the next generation of American innovation," said Peter Hoeschele, an OpenAI vice president . The announcement comes hours after Michigan's two largest utilities both announced new progress in the tech industry's quest to build massive data centers in Michigan, which so far has none of the hyperscale facilities owned by tech giants like OpenAI, Google and Microsoft. Providing power to the announced facility will increase DTE's power demand by roughly 25% -- a sharp uptick that company officials plan to fulfill using excess capacity on DTE's grid, plus a $2 billion battery facility paid for by the developers. DTE President and CEO Joi Harris called the news "an exciting milestone" for the company while touting it as an opportunity to create "substantial affordability benefits for existing customers." Beyond the Stargate campus, DTE is in late-stage negotiations for another 3 gigawatts' worth of data center capacity, Harris said during a Thursday earnings call. Officials with Consumers Energy, meanwhile, announced they're nearing completion of deals for three large data centers amounting to a collective 2 gigawatts of power -- about double the near-term demand Consumers projected back in August, when it announced a deal with a single data center developer for up to 1 gigawatt of power. Consumers has not shared details about the locations of those proposed data centers or the companies involved. But Microsoft has already announced the purchase of two sites in Allegan and Kent Counties, located in Consumers territory. Additional data center interest has emerged from the Howell area to the rural outskirts of Ann Arbor, Monroe and Kalamazoo. The fast-and-furious dealmaking comes after Michigan lawmakers authorized new tax breaks meant to entice big tech companies to build in Michigan amid a global data center boom. Proponents tout the multi-billion-dollar facilities as a way to bring new investment and tax revenue to Michigan. Although the state's new law exempts eligible data centers from the state's 6% sales and use tax, local taxes can amount to millions of dollars a year for each facility. Opponents, however, fear the facilities will overtax Michigan's energy grid, raise utility rates and negatively transform the rural farming communities that tend to attract data centers because of their abundance of cheap undeveloped land. "How many do we need, and how close together should they be?" asked Regina Kudla, a resident of the Ypsilanti area, where the University of Michigan and Los Alamos National Laboratory are pursuing a $1.2 billion project. Kudla said she is concerned that the facilities' water and energy use could overtax supplies. While Whitmer touted the data center announcement, the investment comes after several blows to her administration's economic development strategy in recent months. They include Sandisk pulling out of a megasite deal near Flint that was estimated to be worth $63 billion, or nine times the cost of the Saline Township project. In addition, the Legislature defunded a large-scale incentive fund that fueled $2 billion in subsidies. The Related Companies are well-known in Washtenaw County for developments and record-setting donations to the University of Michigan. The Stephen M. Ross School of Business is named for the Related founder and chairman. In addition to donations supporting athletics, Ross also is a funder of the U-M innovation campus under construction in Detroit. On Tuesday, privately held OpenAI and Oracle (NYSE: ORCL) announced another Stargate development in Milwaukee valued at $15 billion and developed by Vantage Data Centers. The massive hyperscale data centers built by the likes of Google, Meta and Microsoft tend to occupy hundreds of acres apiece, gobbling up as much energy as a midsized or even large city. Depending how costs are apportioned for that new demand, it could bring affordability for everyone by spreading the cost of maintaining poles, wires and power plants among more customers, or it could raise rates if data center developers aren't made to pay for the potential billions of dollars' worth of investments needed to connect them to the grid. Utilities are balancing excitement about the money to be made expanding their business with concerns that the predicted data center boom could fail to materialize, leaving ratepayers holding the bill for that infrastructure build-out. In a rate case filed with state energy regulators, Consumers has proposed establishing special rules that would require data center operators to sign 15-year contracts that guarantee consistent electricity use and impose steep exit fees on data center operators that downsize or cease operations mid-contract. The goal, Consumers Director of Cost and Pricing Laura Connolly said in a regulatory filing, is to ensure that massive investments meant to accommodate data centers don't wind up raising rates for everyday power customers. Beyond questions about costs, environmentalists are worried utilities will falter in their efforts to get off fossil fuels as data centers prompt a rapid increase in power usage. Indeed, both DTE and Consumers say their long-term plans to absorb data center load involve building new fossil fuel power plants. Consumers Energy President and CEO Garrick Rochow said Thursday that the utility will file a long-term power plan with state regulators next year detailing plans for "both battery capacity and natural gas capacity." "The more we add, in terms of data centers, that will continue to grow," Rochow said. DTE officials, meanwhile, announced Thursday that they intend to build a gas plant in the coming years to offset lost power generation from the Monroe coal plant slated to go offline in 2032. But both utilities contend they can make those fossil fuel investments while still complying with the state's climate law, which requires them to achieve 100% clean energy by 2040. The law counts natural gas plants equipped with carbon capture and storage technology as an acceptable form of clean energy. Environmental groups dislike that strategy. To qualify for state tax credits, data centers must procure clean energy covering 90% of their needs. But Charlotte Jameson, chief policy officer with the Michigan Environmental Council, said her group is pushing for clean power commitments to be included directly in the contracts utilities sign with data center developers. As for the plans to build new gas plants, Jameson said, "that's definitely something that we're going to be pushing back against." ___ This story was originally published by Bridge Michigan and distributed through a partnership with The Associated Press.

OpenAI, Oracle bringing AI data center to Saline Township

Why it matters: Data centers power the AI boom reshaping the Midwest, straining energy systems and consuming millions of gallons of water while offering unclear benefits for local communities. * These facilities, which house computer systems, servers and storage infrastructure, can bring temporary jobs and property tax revenue. State of play: The project is slated to start construction early next year, according to a news release, creating 2,500 construction jobs and 450 onsite jobs. It entails three 550,000-square-foot single-story buildings, and per the Wall Street Journal, is set to cost more than $7 billion. * It's part of OpenAI's work with tech giant Oracle to create more capacity for power-hungry AI systems. Between the lines: Detroit-based DTE Energy will supply the project's power, including using new battery storage financed by the project. DTE maintains in the news release that it won't impact existing customers. * Michigan legislation lowering the cost of building AI infrastructure factored into the decision to place the project here, per Gov. Gretchen Whitmer, whose office calls the project "the largest one-time investment in state history." * Whitmer's office adds that the project will use a "closed loop water system that will not require any additional water from our Great Lakes." The intrigue: The Saline project's developer, Related Digital, is a subsidiary of Related Cos., the firm founded by Detroit-born billionaire Stephen Ross. * Ross doesn't have formal involvement with Related Digital, per Crain's. By the numbers: Data centers used 4.4% of U.S. electricity in 2023 and could consume up to 12% by 2028, per the U.S. Department of Energy.

Michigan selected for OpenAI Stargate data center; Gov. Whitmer calls it "largest investment" in state history

DeJanay Booth-Singleton is a digital producer at CBS Detroit. She covers various topics such as crime, business and politics. A new OpenAI Stargate facility is coming to Saline Township, which Michigan Gov. Gretchen Whitmer said on Thursday is the "largest investment" in state history. The multi-billion-dollar data center will be built by Oracle and Related Digital, creating more than 2,500 union construction jobs, over 450 on-site jobs and 1,500 jobs across Washtenaw County, according to a news release. According to OpenAI, the facility comes after the company announced six data center sites across the U.S. The facilities are part of a $500 billion investment in artificial intelligence infrastructure that was announced in January. Construction on the Michigan facility is expected to begin in early 2026, pending approval from the Michigan Public Service Commission, according to Related Digital. "Michigan has long been at the center of American engineering and manufacturing. We're proud to build here and to continue expanding the infrastructure needed to ensure the benefits of AI reach everyone," OpenAI said in a news release. In a statement, Related Digital CEO Brent Behrman said, "The Related Digital team has decades of combined experience in site acquisition and development, partnering with utility providers, and delivering data centers for leading hyperscalers on time and on budget. We look forward to beginning construction in early 2026." State officials say Michigan was selected because of the state's "strong construction and tech workforce, capable of both building and operating the facility," as well as bipartisan bills signed by Whitmer to lower the cost of building AI infrastructure. State officials say the project is expected to be one of the most advanced AI facilities in the nation and will not require additional power generation or additional water from the Great Lakes through a closed-loop water system. Officials say the facility will also preserve more than 700 acres of land that will be used as farmland, wetland and forest. In addition to the large investment, state officials say Related Digital will invest $14 million in local fire departments, a community investment fund and a farmland preservation trust, as requested by the Saline Township Board. "Today, we won the largest economic project in Michigan history," Whitmer said in a statement. "I'm grateful to these cutting-edge companies for betting on Michigan, building on our work to compete for and win big projects in next-generation industries from cars and clean energy to semiconductors and batteries. We will continue working together at the state level to win more projects so we can create even more good-paying, local jobs for Michiganders and grow our economy. This investment from Oracle and Related Digital sends a simple message to anyone who wants to build the future -- you can build it in Michigan." Talk of data centers has been at the forefront in recent months, with a proposed center in Howell Township. However, residents in Livingston County have opposed the proposed center, even calling for a moratorium on rezoning an area of land. Howell Township Trustee Bob Wilson says a committee will be created to review the information about the potential data center. This week, the Michigan Public Service Commission held a public meeting to discuss how the utility companies would meet the future demand of data centers in the future. Protestors rallied outside the meeting, and residents voiced concerns about how the state could reach its goal of being carbon-free by 2040.

Tech Giants Announce $7B Data Center, Michigan's First Hyperscale Campus

Michigan is poised to receive its first hyperscale data center after three tech giants revealed themselves Thursday as the developers behind a proposed 1-gigawatt-plus AI project on farmland in Saline Township. The news that OpenAI, Oracle and Related Digital will build the massive computing facility for their Stargate joint venture comes hours after officials with DTE Energy, the utility serving the Saline area, announced on a quarterly earnings call that the company had inked a deal to provide 1.4 gigawatts of power to an unnamed data center project. DTE Spokesman Ryan Lowry confirmed Thursday afternoon that the project is the Saline Township campus. Construction is slated to begin in 2026. The Wall Street Journal reported its value will top $7 billion. "I'm grateful to these cutting-edge companies for betting on Michigan, building on our work to compete for and win big projects in next-generation industries from cars and clean energy to semiconductors and batteries," Gov. Gretchen Whitmer said in a statement. Whitmer hailed the deal as "the largest economic project in Michigan history," saying it will create more than 450 onsite jobs, plus additional spinoff jobs in Washtenaw County. In 2022, General Motors announced a $7 billion investment across two factories, promising 4,000 workers. The data center proposal has drawn its fair share of pushback. After the Saline Township board voted last month against rezoning the 575-acre site for the data center, Related Digital successfully sued, accusing the township of exclusionary zoning. A settlement in that case last week, combined with the DTE deal to provide power, paved the way for Thursday's public announcement. The township's supervisor and attorney did not immediately respond to messages left by Bridge Michigan on Thursday. Township Planning Commissioner Ronald Kohler told Bridge Michigan that he originally voted against the proposal, but has grown more comfortable since developers agreed to invest some $14 million to the local community and make concessions such as on-site groundwater level monitoring wells. "I really think once it's in there, you won't even know what's there," he said. "You can't live in the horse and buggy days no more." The deal will be eligible for a sales and use tax exemption on equipment, a subsidy approved by the Legislature in late 2024. The companies also will seek a 12-year, 50% local tax abatement, according to the court settlement. House Speaker Matt Hall, R-Richland Township, noted Thursday that he voted against the data center tax breaks that have prompted a wave of interest from the tech industry. He said he'd like to see economic development officials get more upfront buy-in on projects with the potential to reshape communities. "The battery plants come in, and the public don't want them, and we're starting to see that on the data centers, too," he said. Yet the deal could signal more opportunity for Michigan during a period of rapidly changing technology, said Phil Santer, chief operating officer of Ann Arbor SPARK economic developers. After working on the Saline Township project and visiting others in the US, "we're thinking about where this can go toward an overall AI strategy for the state," Santer told Bridge. "A data center of this scale in our backyard just adds to our assets." A press release from the three companies stated that the data center campus would occupy 250 acres of the site with three buildings of 550,000 square feet apiece. The campus will use a closed-loop system to cool servers, which company officials claimed will limit the site's water use "to levels comparable to an office building." "This project will help ensure Michigan is a key part of building the AI infrastructure that will power the next generation of American innovation," said Peter Hoeschele, an OpenAI vice president . Other data center interest The announcement comes hours after Michigan's two largest utilities both announced new progress in the tech industry's quest to build massive data centers in Michigan, which so far has none of the hyperscale facilities owned by tech giants like OpenAI, Google and Microsoft. Providing power to the announced facility will increase DTE's power demand by roughly 25% -- a sharp uptick that company officials plan to fulfill using excess capacity on DTE's grid, plus a $2 billion battery facility paid for by the developers. DTE President and CEO Joi Harris called the news "an exciting milestone" for the company while touting it as an opportunity to create "substantial affordability benefits for existing customers." Beyond the Stargate campus, DTE is in late-stage negotiations for another 3 gigawatts' worth of data center capacity, Harris said during a Thursday earnings call. Officials with Consumers Energy, meanwhile, announced they're nearing completion of deals for three large data centers amounting to a collective 2 gigawatts of power -- about double the near-term demand Consumers projected back in August, when it announced a deal with a single data center developer for up to 1 gigawatt of power. Consumers has not shared details about the locations of those proposed data centers or the companies involved. But Microsoft has already announced the purchase of two sites in Allegan and Kent Counties, located in Consumers territory. Additional data center interest has emerged from the Howell area to the rural outskirts of Ann Arbor, Monroe and Kalamazoo. The fast-and-furious dealmaking comes after Michigan lawmakers authorized new tax breaks meant to entice big tech companies to build in Michigan amid a global data center boom. Proponents tout the multi-billion-dollar facilities as a way to bring new investment and tax revenue to Michigan. Although the state's new law exempts eligible data centers from the state's 6% sales and use tax, local taxes can amount to millions of dollars a year for each facility. Opponents, however, fear the facilities will overtax Michigan's energy grid, raise utility rates and negatively transform the rural farming communities that tend to attract data centers because of their abundance of cheap undeveloped land. "How many do we need, and how close together should they be?" asked Regina Kudla, a resident of the Ypsilanti area, where the University of Michigan and Los Alamos National Laboratory are pursuing a $1.2 billion project. Kudla said she is concerned that the facilities' water and energy use could overtax supplies. A deal after others fell apart While Whitmer touted the data center announcement, the investment comes after several blows to her administration's economic development strategy in recent months. They include Sandisk pulling out of a megasite deal near Flint that was estimated to be worth $63 billion, or nine times the cost of the Saline Township project. In addition, the Legislature defunded a large-scale incentive fund that fueled $2 billion in subsidies. The Related Companies are well-known in Washtenaw County for developments and record-setting donations to the University of Michigan. The Stephen M. Ross School of Business is named for the Related founder and chairman. In addition to donations supporting athletics, Ross also is a funder of the U-M innovation campus under construction in Detroit. On Tuesday, privately held OpenAI and Oracle (NYSE: ORCL) announced another Stargate development in Milwaukee valued at $15 billion and developed by Vantage Data Centers. Utilities prepare The massive hyperscale data centers built by the likes of Google, Meta and Microsoft tend to occupy hundreds of acres apiece, gobbling up as much energy as a midsized or even large city. Depending how costs are apportioned for that new demand, it could bring affordability for everyone by spreading the cost of maintaining poles, wires and power plants among more customers, or it could raise rates if data center developers aren't made to pay for the potential billions of dollars' worth of investments needed to connect them to the grid. Utilities are balancing excitement about the money to be made expanding their business with concerns that the predicted data center boom could fail to materialize, leaving ratepayers holding the bill for that infrastructure build-out. In a rate case filed with state energy regulators, Consumers has proposed establishing special rules that would require data center operators to sign 15-year contracts that guarantee consistent electricity use and impose steep exit fees on data center operators that downsize or cease operations mid-contract. The goal, Consumers Director of Cost and Pricing Laura Connolly said in a regulatory filing, is to ensure that massive investments meant to accommodate data centers don't wind up raising rates for everyday power customers. Beyond questions about costs, environmentalists are worried utilities will falter in their efforts to get off fossil fuels as data centers prompt a rapid increase in power usage. Indeed, both DTE and Consumers say their long-term plans to absorb data center load involve building new fossil fuel power plants. Consumers Energy President and CEO Garrick Rochow said Thursday that the utility will file a long-term power plan with state regulators next year detailing plans for "both battery capacity and natural gas capacity." "The more we add, in terms of data centers, that will continue to grow," Rochow said. DTE officials, meanwhile, announced Thursday that they intend to build a gas plant in the coming years to offset lost power generation from the Monroe coal plant slated to go offline in 2032. But both utilities contend they can make those fossil fuel investments while still complying with the state's climate law, which requires them to achieve 100% clean energy by 2040. The law counts natural gas plants equipped with carbon capture and storage technology as an acceptable form of clean energy. Environmental groups dislike that strategy. To qualify for state tax credits, data centers must procure clean energy covering 90% of their needs. But Charlotte Jameson, chief policy officer with the Michigan Environmental Council, said her group is pushing for clean power commitments to be included directly in the contracts utilities sign with data center developers. As for the plans to build new gas plants, Jameson said, "that's definitely something that we're going to be pushing back against." ___ This story was originally published by Bridge Michigan and distributed through a partnership with The Associated Press.

OpenAI, Oracle plan 1 gigawatt Stargate data center in Michigan with Related Digital

OpenAI, Oracle, and Related Digital are building a 1 GW data center campus in Michigan, a multi-billion dollar investment to expand U.S. AI infrastructure. This project, part of OpenAI's larger Stargate expansion, aims to meet its 10 GW commitment and will create over 2,500 union construction jobs, positioning Michigan as a hub for AI innovation. OpenAI, Oracle and Related Digital will build a data-center campus of more than 1 gigawatt in Saline Township, Michigan, as part of their Stargate push to expand U.S. artificial intelligence infrastructure capacity. The announcement made on Thursday underscores the AI industry's surging appetite for computing power, driven by the pursuit of technology capable of matching or surpassing human intelligence. The companies said it was a multi-billion dollar investment, without disclosing the exact figure. Industry executives have said 1 GW of computing power, enough to power roughly 750,000 U.S. homes, can cost around $50 billion. The construction is slated to begin in early 2026. The project is part of Oracle and OpenAI's 4.5-GW Stargate expansion and, together with six other U.S. sites, raises the infrastructure group's planned capacity to more than 8 GW and total investment to over $450 billion in the next three years. OpenAI said the move kept Stargate ahead of schedule to meet its $500 billion, 10-GW commitment. The startup has shared few details on how it plans to fund the spending. Earlier this week, it completed a restructuring that frees the ChatGPT maker to move away from its nonprofit roots. Reuters has reported it was laying the groundwork for an initial public offering that could value the company at up to $1 trillion. But surging valuations of AI companies and their massive AI spending commitments, which total more than $1 trillion for OpenAI, have raised fears that the AI boom is inflating into a bubble. OpenAI said on Thursday Related Digital would develop the Michigan project, which is expected to create more than 2,500 union construction jobs. "This project will help ensure Michigan is a key part of building the AI infrastructure that will power the next generation of American innovation," said Peter Hoeschele, OpenAI's vice president of industrial compute.

OpenAI, Oracle plan 1 gigawatt Stargate data center in Michigan with Related Digital

(Reuters) -OpenAI, Oracle and Related Digital said on Thursday they would build a data-center campus of more than 1 gigawatt in Saline Township, Michigan, as part of their Stargate push to expand U.S. artificial intelligence infrastructure capacity. The project would start construction in early 2026 and is part of Oracle and OpenAI's previously announced 4.5-GW expansion under the Stargate program. It brings Stargate to more than 8 GW of planned capacity and more than $450 billion in investment over the next three years. The companies said it was a multi-billion dollar investment, without disclosing the exact figure. Industry executives have said 1 GW of computing power, enough to power roughly 750,000 U.S. homes, can cost around $50 billion. Related Digital will develop the project, which is expected to create more than 2,500 union construction jobs. "This project will help ensure Michigan is a key part of building the AI infrastructure that will power the next generation of American innovation," said Peter Hoeschele, OpenAI's vice president of industrial compute. (Reporting by Aditya Soni and Akash Sriram in Bengaluru; Editing by Shilpi Majumdar)