Understanding data centers and their local impact
Data centers are the backbone of our digital lives. These secure, high-tech facilities store and process data for cloud services, artificial intelligence (AI), e-commerce, banking, entertainment, logistics, and more. Though essential to the digital economy, data centers are often misunderstood. This page is designed to help local communities, stakeholders, and residents better understand what data centers are, and what they are not.
What Is a Data Center?
Data centers are secure facilities that house computing systems and related components, such as servers, networking equipment, and storage systems. They enable the flow of digital services, from internet access and cloud computing to logistics, research, health care systems, and beyond. At their core, data centers serve as the infrastructure powering nearly every aspect of our connected world.
Local Economic Impact
To help local stakeholders understand the potential benefits, the following estimates show the projected economic impact of data center construction and operations in Washtenaw County, including jobs, tax revenue, and regional investment.
Built for Efficiency
Modern data centers are designed with sustainability in mind:
- Many participate in renewable energy programs and carbon-reduction efforts
- Use advanced cooling systems that reduce energy waste
- Operate quietly with lower water usage and minimal traffic
- Built to meet LEED or equivalent green building standards
Environmental Considerations
While data centers require energy and infrastructure, modern facilities are increasingly designed to reduce their environmental impact:
- Corporate commitments to renewable energy and carbon neutrality
- Efficient design that maximizes cooling and power usage effectiveness (PUE)
- Ongoing efforts to responsibly manage e-waste and materials
Dispelling Myths
- NOT NOISY These facilities run quietly and do not create industrial noise (this is especially true for water-cooled data centers)
- NOT TRAFFIC HEAVY Most data centers operate with fewer than 50 on-site employees
- NOT BURDENSOME ON SERVICES They have minimal impact on schools, housing, or emergency services
Policy & Incentives
- Michigan offers extended sales and use tax exemptions for qualifying data center investments
- Local communities may consider additional incentives based on zoning and site readiness
- Ann Arbor SPARK can help data center developers navigate these opportunities
Why Washtenaw County?
Washtenaw County offers a strategic location for data centers due to:
- Robust electrical utility and fiber infrastructure
- Access to clean, reliable energy through programs like DTE’s MIGreenPower
- A favorable climate that supports energy-efficient cooling
- Access to water infrastructure through the Great Lakes Water Authority and other providers
- A strong and growing talent pipeline in IT, engineering, and skilled trades
Case Studies and Additional Resources
To better understand the real-world impacts of data center development, explore case studies from peer regions:
How SPARK Can Help
Ann Arbor SPARK is your partner in:
- Identifying optimal sites
- Coordinating with local governments and utilities
- Navigating permitting processes
- Engaging the local workforce and education providers
- Supporting confidential and strategic business expansion
Connect With Us
Interested in establishing a data center in Washtenaw County? We are here to help. Contact SPARK’s business development team to learn more about available sites, infrastructure, and resources.
IMPLAN economic impact estimates were generated using the IMPLAN economic modeling system, 2023 data set, based on inputs provided by Ann Arbor SPARK and the Detroit Regional Partnership. Results reflect the Ann Arbor, MI MSA region (Washtenaw County) and are reported in 2025 dollars.
