AI data centers and advanced manufacturing are increasing Michigan’s appetite for electricity. Thousands of acres of new solar could help supply it — while potentially creating another source of income for Michigan farmers.
LANSING — Michigan wants AI data centers, advanced manufacturing, battery plants and other high-tech investments capable of creating jobs and pumping billions of dollars into the state’s economy.
There’s just one problem.
They need electricity. Lots of it.
At the same time, Michigan utilities are being required to dramatically increase renewable-energy generation, with the state targeting 50% renewable electricity by 2030 and 60% by 2035.
Those two forces are beginning to collide in Michigan farm country.
The Michigan Public Service Commission Thursday approved Ranger Power’s 90-megawatt Acceleration Solar project across Leslie, Onondaga and Vevay townships in southern Ingham County.
It is the first project approved under Public Act 233 of 2023, Michigan’s controversial law creating a state-level siting process for large solar, wind and battery-storage projects under certain circumstances.
Construction is expected to begin in 2027, with commercial operation in 2028.
But Acceleration Solar is only the beginning.
WHY THIS MATTERS TO YOU
Your electric bill: Michigan regulators are trying to make sure enormous new data centers pay the full cost of the power and grid improvements they require rather than shifting those costs onto households and existing businesses.
Jobs and investment: Michigan needs abundant, reliable electricity if it hopes to compete for AI data centers, factories and other power-hungry investments.
Thousands of acres: Michigan’s two largest utilities envision as much as 23,400 megawatts of solar by 2040, which could require an estimated 117,000 to 234,000 acres.
Farm income: Some of that land may not have to stop producing agricultural income. Michigan farmers already are grazing sheep underneath solar panels.
The bigger question: Can Michigan build enough electricity for its next economy without unnecessarily sacrificing farmland or increasing costs for existing customers?
Michigan Is Going To Need A Lot More Power
Few projects illustrate Michigan’s new electricity challenge better than the enormous data center planned for Saline Township in Washtenaw County.
The facility could require as much as 1,383 megawatts of electricity.
That’s more than 15 times the nameplate generating capacity of the newly approved 90-megawatt Acceleration Solar project.
And unlike a conventional office building, a hyperscale data center can require huge quantities of electricity 24 hours a day.
The demand is so large that on the same day the MPSC approved Acceleration Solar, regulators also approved emergency procedures requiring DTE to shed the Saline data center’s massive load before cutting power to other customers if an emergency threatens the grid.
That puts the debate over data centers, power plants and Michigan electricity policy directly into consumers’ lives.
State regulators also are trying to ensure existing customers don’t wind up paying for the grid expansion required by enormous new electricity users.
Earlier this month, the MPSC recommended that Michigan law require data centers to pay 100% of the costs they impose on the electric system, including transmission upgrades.
The stakes are significant.
If Michigan doesn’t have sufficient electricity and transmission capacity, companies considering billions of dollars of investment can build somewhere else.
But building that power infrastructure costs money and requires land.
How Much Solar Would It Take?
Here’s one way to understand the enormous scale involved.
Suppose a data center consumed 1,383 megawatts continuously throughout a year.
Michigan solar operated at a 20.8% capacity factor in 2024, according to the U.S. Energy Information Administration. That means 100 megawatts of solar generating capacity averaged roughly 20.8 megawatts of actual output over the course of the year.
To produce the same total amount of electricity over an entire year as a facility continuously consuming 1,383 megawatts would therefore require roughly 6,650 megawatts of Michigan solar capacity.
At today’s estimate of five to 10 acres per megawatt, that theoretically could require approximately 33,000 to 66,000 acres — roughly 52 to 104 square miles.
That does not mean anyone is proposing to build 6,650 megawatts of solar specifically for the Saline data center.
Nor could solar alone reliably operate a massive data center around the clock. Solar doesn’t generate electricity at night and produces less during cloudy weather and Michigan winters. Batteries, nuclear, natural gas, wind, electricity from the regional grid or some combination would still be required to provide reliable 24-hour power.
The comparison simply illustrates the scale of Michigan’s emerging electricity challenge.
And Saline may not be the last hyperscale data center Michigan attracts.
Michigan’s Solar Buildout Is Already Underway
Consumers Energy alone is working toward adding as much as 8,000 megawatts of solar.
In June, the MPSC approved Consumers Energy contracts for another 1,269 megawatts of solar capacity, including Acceleration Solar and a 499-megawatt project in Calhoun County.
Meanwhile, the state’s new PA 233 siting pipeline includes additional solar projects in Genesee, Washtenaw, Lenawee and Livingston counties, among others.
Michigan DNR says DTE and Consumers Energy together have envisioned as much as 23,400 megawatts of solar by 2040.
At five to 10 acres per megawatt, DNR estimates that could require 117,000 to 234,000 acres.
That’s where Michigan farmers enter the story.
Does Solar Mean Farmland Disappears?
Not necessarily.
A practice known as agrivoltaics combines electricity generation with agricultural production on the same property.
And it isn’t theoretical.
More than 400 acres of Michigan solar installations already are being grazed by sheep, according to Michigan State University.
Nationally, approximately 130,000 acres at more than 500 solar sites in 30 states are being grazed by more than 113,000 sheep.
The economics are easy to understand.
Solar operators need to keep vegetation from growing around and underneath their panels. Instead of relying entirely on mowing, a developer can contract with a farmer whose sheep eat the vegetation.
The solar company gets vegetation management. The farmer gets another source of income. The same acreage produces electricity and an agricultural product.
MSU says solar grazing also can support veterinarians, feed suppliers and other businesses in Michigan’s rural agricultural economy.
Michigan’s existing sheep industry potentially could graze 7,200 to 22,000 acres of solar installations, according to MSU estimates.
That potentially turns one of the biggest criticisms of utility-scale solar — the loss of productive farmland — into an economic opportunity for at least some Michigan farmers.
Solar Could Create Rural Jobs — But There’s A Catch
Solar development creates construction work for electricians, equipment operators, laborers and other skilled trades.
The Acceleration Solar agreement goes further by requiring a project labor agreement or collective bargaining agreement covering construction and maintenance work.
But solar farms don’t generally create enormous permanent workforces once construction is finished.
That’s an important economic distinction.
The data center or factory consuming the electricity potentially brings major capital investment and employment.
The solar farm provides some of the energy infrastructure necessary to make those investments possible.
Agrivoltaics potentially adds another economic layer by allowing farmers and rural businesses to earn money from the same property.
But Michigan Isn’t About To Lose All Its Farmland
The numbers also need perspective.
Michigan has roughly 10 million acres of agricultural land.
Even DNR’s high-end estimate for Michigan’s solar buildout would occupy less than 3% of it.
For comparison, DNR estimates approximately 7% to 10% of Michigan agricultural land currently is devoted to growing corn for ethanol production.
So solar isn’t about to consume Michigan agriculture statewide.
The impact can look very different locally.
Solar development won’t be evenly distributed among Michigan’s communities. Projects tend to concentrate where developers can find large amounts of suitable land near transmission infrastructure.
That means individual townships can see hundreds or thousands of acres transformed.
And that’s one reason PA 233 has generated such intense opposition from some rural communities concerned about losing local control.
Can Michigan Get More From The Same Acre?
Michigan’s coming electricity buildout creates an unusual economic opportunity.
If the state is going to devote tens of thousands of additional acres to producing electricity, why should those properties produce only electricity?
Michigan DNR already says sheep and other appropriate grazing animals can provide a lower-carbon and potentially lower-cost alternative to conventional mowing, although solar projects must be designed from the beginning with appropriate fencing, water and vegetation.
Crops eventually could provide another option.
Michigan and researchers elsewhere are examining whether certain agricultural products can grow between or underneath solar arrays, although crop-based agrivoltaics remains much less developed than livestock grazing.
The concept isn’t going to work everywhere.
But it raises a much larger economic question for Michigan.
The state wants the data centers, factories and technology businesses that could drive its next economy.
Those industries need enormous amounts of electricity.
Producing that electricity will require investment, power plants, transmission infrastructure — and land.
If Michigan can use some of that same land to produce electricity, farm income and agricultural products simultaneously, the state’s coming solar boom could become more than an energy story.
It could become another part of Michigan’s rural economy.
And as Michigan decides how to power its AI and advanced-manufacturing future, what happens underneath all those solar panels may matter almost as much as the electricity they produce.
MITechNews will ask the Michigan Department of Agriculture and Rural Development whether Michigan should encourage agrivoltaics on utility-scale solar developments — and whether the state’s coming solar expansion could create new income and jobs for Michigan farmers.
