Michigan AG challenges huge data center project after key contract terms are blacked out

A TikTok clip from Bloomberg Business (@BloombergBusiness) is drawing attention to a massive proposed data center near Ann Arbor, Michigan.

The clip highlights Michigan Attorney General Dana Nessel's objections to the project.

@bloombergbusiness Michigan Attorney General Dana Nessel is challenging approval of a major data center project near Ann Arbor, arguing that ratepayers deserve more transparency about contracts and potential costs. Tune into Wall Street Week for more of the conversation. #AI #tech #business #Michigan #datacenters ♬ original sound - Bloomberg Business

According to Nessel, the contract linked to the development was filed with the Michigan Public Service Commission in an ex parte proceeding, which would keep the public out of the process.

In the Bloomberg Business video, Nessel noted that she first learned of the data center on Halloween last year. 

She said, "This was gonna be an enormous project, a project bigger than any of its kind we've seen."

Beyond the ex parte proceeding, Nessel's main arguments in the clip are that the public cannot judge the contract fairly due to the amount of redactions. 

Nessel explained, "The contract that was posted publicly was heavily redacted and that included redactions to some incredibly important information, … things like exit fees, what would happen upon the termination of contract, even basic terms and definitions had been redacted." 

She added, "Even the signatories to the contract had been redacted so that we can't even know who signed this contract or what company they're affiliated with."

And the concerns that people have are real. 

As utilities build new transmission lines, substations, or even generation plants to serve those facilities, the public ends bearing the brunt of those costs. Households are already feeling the impact through higher monthly bills. 

Large data centers also use significant amounts of water for cooling. Residents in many places are worrying about their strain on local resources.

While Big Tech promises upsides of adding these data centers, the lack of transparency into the deals that enable them makes its argument shaky at best. 

The Bloomberg video concluded with Nessel asking, "How are we supposed to know whether or not ratepayers are getting a fair deal if we're not even allowed to see the contract itself?"

It's never been a better time to stay informed. If there's a data center proposal in or near your community, keep up-to-date as much as you can, and inform your neighbors. Attending public meetings when they do happen can also make a huge difference.

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