Microsoft plans to add $4 billion to Racine County Data Center

Microsoft is planning to spend $4 billion to build a second data center in Mount Pleasant, Wisconsin. The new facility will become part of Microsoft’s artificial intelligence services’ distributed training supercomputer.

Microsoft plans to spend $4 billion to build a second data center in Mount Pleasant, and says it will become the world’s most advanced AI center.

According to a company’s announcement on September 18th, the new projects include the construction of facilities and technology infrastructure.

The latest announcement shows that Microsoft’s Racine County development costs around $7.3 billion, including a $3.3 billion commitment made in 2024.

As of the first Microsoft announcement in May 2024, including a visit from President Joe Biden, Journal Sentinel reported that its Racine County spending could easily exceed $10 billion.

Much of the work is being done on land previously acquired by the Foxconn Technology Group, for a high-tech manufacturing complex that has been touted by state and federal officials, including President Donald Trump, as a transformation of the state’s economy.

The Foxconn project couldn’t stand the original promise, but the infrastructure helped Microsoft select properties for this development to bring the utility into the region.

The second Microsoft Data Center plans to house some of what the company calls a distributed training supercomputer. Microsoft said the facility will become the most advanced AI data center in the world.

Microsoft President and Vice Chair Brad Smith said once the first data center opens, the facility will house hundreds of thousands of the world’s most powerful Nvidia graphics processing units, important for its AI development and one of the world’s most unique technologies.

“The rising data center at Mount Pleasant will be live early next year, houseing the most powerful supercomputer on the planet, literally,” Smith told audiences at the Festival Hall in Racine. “In fact, buildings have supercomputers 10 times more powerful than any other supercomputer in the world.”

The company plans to build the second largest “chiller” used to cool the technology used in the facility worldwide. The biggest chiller is in Qatar, Smith said.

Mount Pleasant’s Microsoft Data Center aerial view

Check out the aerial view of Microsoft’s data center in Mount Pleasant, Wisconsin

But beyond facility constraints and operations, Smith said the company is helping to create a “data center academy” at Gateway Technical College, and the partnership between the University of Wisconsin-Milwaukee and Titletown Technology is essential for training workers and partnering with local small businesses.

Microsoft said the Racine County Data Center is the company’s latest initiative to compete with other technology companies on artificial intelligence on Facebook’s parent company meta, and is the first of several facilities in multiple states.

Construction of the first Racine County data center is almost complete

Microsoft is finishing construction at the first Racine County Data Center, which will be completed in early 2026. The company says it will hire more than 400 employees to work in its first data center.

Construction plans for the second data center are expected to end by the end of 2028. Thousands of construction operations will be linked to the completion of the data center, the company said.

Gov. Tony Evers said Microsoft’s investments “make Wisconsin the home of the world’s most powerful data centers.”

“We’ve seen the benefits for tens of thousands of construction workers and Wisconsin workers who have skilled labor,” Evers said. “This project creates excellent families from carpenters, plumbers and electricians to maintain union jobs across the region.”

Evers said innovation is part of the state’s tradition, and the new AI frontier is being used in a variety of areas, including advanced manufacturing, biohealth and personalized medicine.

“It puts Wisconsin at the very cutting edge of AI power not only in the US but around the world,” Evers said. “Thanks to Microsoft’s partnership, UW-Milwaukee’s new innovation lab is where hundreds of small, lean business owners are learning how to use AI.”

Microsoft Development was closely monitored by environmental groups

Data centers require a large amount of electricity and water. These demands sparked international concern, and Wisconsin’s environmental groups raised questions about plans from Microsoft and other companies in Badger.

On September 15, on behalf of Milwaukee riverbanks, Midwest environmental advocates filed a lawsuit against the city of Racine, which provides water to Mount Pleasant over documents related to Microsoft’s development.

On September 16, the city of Racine published a document indicating that the first Microsoft data center will use 234,000 gallons of Michigan water per day and will return to 81,000 gallons per day in 2026.

The document also states that the remaining expansion can use 2,031,000 emissions using up to 2,814,000 gallons of water per year.

Smith says Microsoft plans to minimize water use

Smith addressed water concerns by saying, “Lake Michigan will not be afraid of our data centers,” and added that it has built data centers in locations such as Phoenix, Qatar and Abu Dhabi.

“We’re building data centers in the desert because we found a way to run them without using a lot of water,” Smith said, adding that the company developed it with a “closed loop cooling system.”

The chiller will use a giant fan extending over 60 miles and 20 feet in diameter to cool the hot water, then use a giant fan that is piped into the facility to inhale the hot water through a series of pipes.

Smith said more than 90% of the facility relies on a system where it is continuously circulating, and the rest will use external air to switch to cooling and water on days above 85 degrees.

Smith said the data center has enough fiber cables to surround the globe four times, and also has modest annual water use that requires the amount of water that typical restaurants use every year or “what 18-hole golf courses consume weekly in peak summers.”

Apart from the lawsuit, Clean Wisconsin has conducted an analysis of the power used by Mount Pleasant data centers, saying the facility can use more power than all homes in Wisconsin.

The first data center uses approximately 450 megawatts. Microsoft and We Energies are proposing special rates specific to the data center to minimize the impact on local residents.

Smith said Microsoft “is making advance payments for the energy and electricity infrastructure we use — price supply is stable and protecting consumers from rising costs in the future for the data center.”

“For every kilowatt hours we get from a fossil fuel source, we match some kilowatt hours with carbon-free energy that we’ve returned to the grid,” Smith said. “This includes a new 250 (megawatt) solar project under construction to support this commitment. In addition, our partnership with WE Energy will continue to explore and add energy transfer, generation and use on transparent tariffs that support the reliability of the grid.”

This story has been updated with additional information.

This story has been updated to add videos.