Last week, Champaign County officials voted to establish a one-year moratorium on new data centers on April 23, following “serious” inquiries into new developments in the county.

But no one has said exactly where the data centers would be located, what companies are proposing them and whether or not the center would be used to house AI infrastructure. 

One proposal includes an approximately 300-acre development near southwest Champaign. A speaker at the meeting said her farmer husband was notified a 313-acre center was proposed in Mahomet. Both would be significantly larger than the county’s existing data centers of a few acres or less. 

A data center is any facility that houses networking infrastructure including servers, databases, routers and storage systems. Traditional data centers have been around since the mid-1900s, but modern AI data centers often occupy several hundred acres of land and take more resources to operate. 

John Hall, planning and zoning director for Champaign County, said one company made a serious proposal in the Rising Road area west of Champaign. But Hall said he wouldn’t reveal the name of the company unless an application was made, saying it is not “public information.” 

Hall noted he had not signed any non-disclosure agreements. Yet no one on the county board or data center task force seemed to know any details on location or companies proposing the centers.

But the public has questioned the secrecy.

“You guys as individuals are standing between your constituents, every individual in the county, and whoever the so-far-to-me anonymous or mysterious person or persons who came to you asking for this — you guys are kind of in the middle,” Urbana resident Ann-Marie Shapiro said in her public comment at the April 23 meeting.

When asked, Andrew Rehn, committee member for the county’s data center activities task force and director of climate policy for Prairie Rivers Network, confirmed the task force hadn’t been told the names of any companies. 

Illinois pauses tax incentives as energy rates rise

In February, Illinois Governor JB Pritzker paused a major state program that had been encouraging the construction of dozens of data centers across the state for the past seven years by offering tax breaks. Indeed, from June 28, 2019 through 2024, the state reported that 27 data centers, valued at nearly $1 billion in estimated tax benefits, had been part of the incentive program.

But concern over significant increases in electrical bills and the depletion of water resources by the centers, both in Illinois and nationwide, has resulted in states and cities banning or challenging the construction of the centers. 

“Soaring demand caused by new and proposed data centers is increasing energy prices, and the way that those costs are spread out among customers means that too often we’re paying higher power bills for these data centers, which come from some of the wealthiest corporations in the world,” Jim Chilsen, communications director for the Illinois Citizens Utility Board, said in an interview with CU-CitizenAccess.

The board is a nonprofit watchdog organization that fights against utility rate hikes and advocates for consumers across the state. In October 2025, the board worked to pass Illinois’ Clean and Reliable Grid Affordability (CRGA) Act, which among its many reforms helps to deal with supply-demand imbalance caused by data centers.

Data centers are also extreme energy consumers, with some data centers potentially requiring more electricity than cities the size of Pittsburgh or Cleveland.

“Generative AI has caused demand to go through the roof, and that’s why we’re facing these challenges right now,” Chilsen said. 

Proposed pause passes in Champaign County

In Champaign County, a one-year moratorium on the development of data centers with 10,000 square feet or more of processing area was proposed in early February 2026 so appropriate zoning regulations can be developed for larger projects like the one proposed. 

A task force formed to discuss data centers had its first of multiple meetings on March 23 to discuss potential impacts of a large data center. 

The original 12-month moratorium in consideration was shortened to nine months during an  April 9 Environmental & Land Use Committee meeting as a compromise to proposals of six months. Members of the task force who do not also hold positions on the county board had no input in the decision. 

On April 23, the moratorium was reestablished for 12 months and council members voted unanimously to approve it. Some board members preferred nine months and voted against the amendment before approving the revised moratorium.

Over 100 people showed up and nearly two hours of public comment preceded the vote. 

“Hastily proceeding with proposals for large-scale data centers that will generate profit exclusively for private companies, create minimal long-term human jobs, deplete the resources of Champaign County that help make it an attractive place to live, remove farmland from the local economy, and exponentially add to the electrical load power companies supply to our areas would be a mistake,” county resident Christine Bidner said during public comment.

The average data center has thousands of servers and can range from 20,000 to 100,000 square feet, with above 50,000 being considered large. Hyperscale centers are generally above 100,000 square feet, with far more servers than large centers. 

The three Colocation Plus data centers in Champaign and Rantoul are all small facilities of no more than 2,000 square feet, John Hall, planning and zoning director for Champaign County, said in February. The National Petascale Computing Facility (NPCF) at the University of Illinois is about 88,000 square feet.

Proposed data centers of such a large size also raise concerns about water usage, as the facilities’ cooling systems often rely on immense amounts of water, with exact numbers rarely disclosed by companies. 

Even the small-scale data centers in Champaign like the NPCF use up to 5,000 gallons of water every minute on days with high operational loads, about twice the amount of water an average individual uses per month. Large data centers consume water at much higher rates.

However newer AI data centers are designed to handle the intense demands of AI and machine learning applications, with the ability to process larger volumes of data and support AI tasks including natural language processing and image recognition.

“[AI data centers] are called hyperscalers, they just use a tremendous amount of energy — as much as a medium-sized city,” Chilsen said. “The largest, most powerful data centers can use as much energy as about 100,000 homes a year.”

Electricity bills of Americans residing in cities or states with data centers are rising to subsidize the energy needs of data centers. Utility boards that don’t negotiate higher specialized rates for data centers leave residential, commercial and industrial ratepayers to fund the data centers’ power needs, according to the board. Secrecy of owners and specific plans for data centers around the country has furthered the controversies.

Illinois is home to 209 data centers, making it the state with the fourth most data centers in the U.S., following Virginia, Texas and California. The state has become a popular location for data centers because of its program that provides owners and operators with various tax exemptions. 

“The Program operates as an income-generating incentive—stimulating economic activity and job creation upfront, while allowing a portion of the resulting new tax inflows to be temporarily exempted,” the 2024 Annual Data Center Investment Report said. 

Among the companies involved in data centers in Illinois are Microsoft, CyrusOne and Digital Realty. 

Thirty-seven states are encouraging data center growth with tax exemptions, many based on the creation of job opportunities, like Illinois, which estimated between 4,000 to 8,000 construction-related jobs being created statewide in its investment report. 

The state also estimated opportunities in engineering, materials supply, logistics and design will increase in relation to data center growth and boost tax revenues, with the benefit through taxes estimated at about 6.25% of the total investment, meaning a $250 million investment would generate $15.6 million in tax benefits.

Data center proposals appear across Illinois

During Governor JB Pritzker’s State of the State Address, he announced his proposal to pause the authorization of new data center tax credits. 

“With the shifting energy landscape, it is imperative that our growth does not undermine affordability and stability for our families,” Pritzker said in his speech.

The proposed pause would last for two years. Pritzker also announced his demands that PJM, the Northern Illinois grid operator, must require data center developers to pay for the resources to power their operations and protect consumers from higher energy rates. 

“We’re glad that Governor Pritzker has proposed pausing that tax incentive, because it’s time to step back and see how we can create strong pro-consumer data center policy,” the Citizens Utility Board’s Chilsen said. “There is a way to balance economic development and protect consumers at the same time from unfairly paying high energy bills because of data centers.”

Despite Illinois’ pause on the tax program in order to reevaluate data centers’ positive and negative impacts, large data centers are continuing to be approved, with or without tax exemptions.

The City of Joliet has approved the construction of a 795-acre data center by HW Technology Park Development LLC, a division of the Texas-based Hillwood Development Company. A 1,037-acre project by Pioneer Development LLC was approved in Yorkville, however residents are attempting to halt construction by filing lawsuits. 

Protective policies regarding energy and water costs as well as environmental concerns have been created, however, with the CRGA Act having been signed into law earlier this year and Illinois’ POWER Act currently in committee. 

Illinois lawmakers introduced the POWER Act to establish energy, water and environmental regulations for hyperscale AI data centers. The bill would require data centers to pay for their own energy costs, pay into a fund providing utility bill assistance to consumers and require utility providers to establish rules protecting their existing customers from subsidizing data center-related costs, among other requirements. 

“The bottom line is data centers should pay for the energy and the infrastructure they need, and that those costs shouldn’t be borne by everyday electric customers,” Chilsen said. “And unfortunately, the way the system is set up right now, that’s what’s happening. We need to reform the system … on all three levels — at the state level, at the power grid operator level, and also at the federal level.”