Microsoft has announced it will allocate $4 billion to build a second data center in Wisconsin. The announcement was made by Microsoft President and Vice Chair Brad Smith at a town hall meeting. This second facility, which is expected to come online in 2027 or later, is in addition to a first data center that is currently under construction in Mount Pleasant and is set to cost $3.3 billion.
The first data center, which will begin operations in early 2026, will house hundreds of thousands of Nvidia Blackwell GB200 graphics processing units (GPUs) to handle artificial intelligence workloads. Microsoft CEO Satya Nadella wrote in a social media post that this facility “will deliver 10x the performance of the world’s fastest supercomputer today.” Wisconsin Governor Tony Evers noted that the state will be home to the largest concentration of GPUs under one roof.
Addressing Energy and Water Concerns
Smith said the new data centers, which are being built on land where Foxconn had originally planned to build a manufacturing plant, will be mindful of their environmental impact. The first data center is projected to use as much as 2.8 million gallons of water per year, a fraction of the over 7 million gallons per day Foxconn was permitted to consume. Microsoft plans to match the amount of energy it consumes from fossil fuel sources with carbon-free energy it contributes to the grid, partly from a solar farm under construction that will contribute 250 megawatts of power. Smith said the two data centers together might require more than 900 megawatts.
A Global Race for AI Infrastructure
The investment in Wisconsin is part of a global push by Microsoft to build capacity to meet the needs of companies running AI models. With over 700 million people using OpenAI’s ChatGPT, which runs on Microsoft’s Azure cloud, demand for AI infrastructure is at an all-time high. Earlier this week, Smith told reporters that the company has allocated $15.5 billion for additional infrastructure spending in the U.K. through 2028. Separately, Amsterdam-based Nebius Group announced last week that Microsoft has agreed to spend up to $19.4 billion over five years to rent AI data center capacity.
Author’s Opinion
This data center investment represents a new era of economic development, where the promise of an AI-powered data center, with its high-tech infrastructure and a small number of specialized jobs, has replaced the traditional lure of a large-scale manufacturing plant. While these projects bring significant investment, they also raise questions about their true community impact, particularly regarding energy and water consumption. The shift from tangible manufacturing jobs to a more abstract, AI-focused infrastructure project is a powerful symbol of the changing nature of the global economy, and it demonstrates a new playbook for corporate and political leaders seeking to attract investment in the 21st century.
Featured image credit: The Energy Mix
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