Microsoft halts Ohio data center plans amid tariffs and energy concerns

The Kosciusko County Commissioner Meeting on May 3, 2025, focused on the implications of Microsoft’s halted plans for a major data center project in Ohio, which could have significant repercussions for local economies and infrastructure. In February, Microsoft announced a $1.53 billion investment to develop a 1,000-acre site, promising to create 250 jobs and commit $12 million to utility and road improvements. However, by late March, the tech giant paused its plans due to economic factors, tariffs, and concerns over energy resources.

Local officials, including mayors from Hebron, New Albany, and Heath, acknowledged the uncertainty surrounding the project, emphasizing the need to prepare for potential delays or cancellations. Microsoft stated its ongoing commitment to the project but indicated that future developments would depend on the direction of its technology.

The meeting also highlighted broader issues affecting the construction timeline, including supply chain disruptions and tariffs on steel and aluminum imports from China, exacerbated by the ongoing conflict in Ukraine. These factors could hinder the availability of critical materials needed for the project.

Concerns were raised about the projected water usage for the data center, which initially estimated a closed-loop system of 19,000 gallons per day but later increased to 40,000-50,000 gallons. Experts suggested that actual water needs could be significantly higher, raising questions about the feasibility of the proposed system.

Additionally, the meeting discussed the potential for the data center to pivot in its operational needs, which could affect local ordinances and land use. Prologis, the real estate firm involved, projected that the data center would employ around 300 workers, but skepticism remained about the reliability of these projections, especially in light of automation trends in the industry.

The meeting concluded with a cautionary note regarding the lifespan of data centers, which are expected to become obsolete within 10 to 20 years. If the data center no longer meets operational needs, the land could be repurposed for heavy industrial use, raising further questions about long-term planning and community impact. The discussions underscored the complexities and uncertainties surrounding large-scale tech projects and their implications for local economies.