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By WisPolitics-State Affairs
Perhaps the surprise bipartisan political issue of 2026? Energy. Specifically, data center development and its impact on energy use and rates.
You will be hearing about data center development a lot this fall from the campaign trail. Tom Tiffany, the presumptive GOP gubernatorial nominee, is talking about it as are the leading Dem governor candidates.
The issue has crossover appeal. It goes to affordability — for renters and homeowners. It hits an environmental note, too, impacting water use and quality and development of farmland.
The numbers behind it are stunning.
Wisconsin’s peak power demand is projected to jump 40% over the next six years, largely driven by the massive data centers being built in the state.
That’s according to a draft of the latest biennial Strategic Energy Assessment recently released by the state Public Service Commission. The report, based on data provided by the utilities, shows peak demand will hit 20 gigawatts by 2032 – up from 14.2 GW this year.
About 4.17 GW of that projected increase — making up 72% of the demand spike — is attributed to three hyper-scale data center developments in Beaver Dam, Port Washington and Mount Pleasant, the last of which was recently brought online by tech giant Microsoft. They’re located within the service areas of Alliant Energy and WEC Energy Group, the parent company for We Energies.
“These load forecasts illustrate the outsized impact data center development is anticipated to have on the energy landscape in Wisconsin in the coming years,” authors wrote.
The latest estimate shows a marked increase from the last SEA report, which acknowledged the role of data centers in driving up energy demand but forecasted a more modest increase. Utilities in 2024 projected peak electric demand to decline by about 5% from 2023 to 2024, followed by a 14.8% increase in demand through 2030.
In a statement on the new SEA report, Citizens Utility Board Executive Director Tom Content says the emergence of data centers and their huge energy demand “shows Wisconsin really needs to develop a better approach” to energy affordability.
“The last time we had a strong planning process in the state, Wisconsin’s electricity rates were the lowest in the Midwest, and now they are second highest,” he said. “We should no longer allow our regulator of monopoly utilities to keep driving down the energy highway without a GPS.”
Content also noted the report shows reliability scores aren’t improving, even as disconnections of utility customers are on the rise.
Meanwhile, utilities are also planning substantially more natural gas generation to keep up with projected demand compared to the previous projections.
The latest SEA shows electric providers plan 5,400 megawatts of new natural gas capacity or upgrades to existing natural gas facilities by 2032, more than double the 2,500 MW planned by 2030 in the previous report.
At the same time, projections for adding solar generation rose to 5,175 MW from 4,200 MW between the respective six-year forecast windows, while wind saw a smaller jump to 1,370 MW from 1,200 MW. Those projected additions will be paired with 2,250 MW of energy storage, an increase from 900 MW in the prior report.
A spokesperson for Milwaukee-based WEC Energy Group says the utility is planning for the growth being driven by data centers while protecting its existing customers, pointing to the recent approval of its Very Large Customer or VLC rate for data centers.
“Data centers will pay for the full amount of anything we build to serve them,” the spokesperson said in an email.
Alliant Energy is making the same promise, with a spokesperson noting “we continue to reiterate our commitment to customers: You will not pay for new large-energy-user growth and your reliability comes first.”
In a statement on the SEA draft, a spokesperson for the Madison-based utility noted its “all of the above” energy strategy includes new battery storage and multiple wind projects.
“We are prepared to meet rising demand reliably and cost-effectively and our resource planning reflects a forward-looking, customer-centric strategy,” the spokesperson said.
The spike in demand is occurring as the state energy mix is changing.
If slated additions and resource retirements all go as planned, the share of Wisconsin’s energy generation from coal will fall from 31% in 2024 to just 3% in 2032, the report shows. Natural gas, however, will rise from 36% to 50% under this scenario, wind will increase from 11% to 17% and solar will go from 5% to 16%.
Another section of the report takes a longer view on future resource planning needs to meet net-zero CO2 targets by 2050, indicating nuclear resources would play a more important role as new nuclear units are assumed to become available in 2036.
Under the Electric Generation Expansion Analysis System, a capacity expansion model projecting generation changes to meet the net-zero goals, the share of generation coming from nuclear power would rise from 13% in 2025 to 18% by 2037, followed by a much larger jump to 64% by 2044.
A bipartisan embrace of nuclear power was seen in the two-year legislative session. Just another indicator that energy has crossover appeal this election cycle.
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The Capitol Report is written by editorial staff at WisPolitics.com, a nonpartisan, Madison-based news service that specializes in coverage of government and politics, and is distributed for publication by members of the Wisconsin Newspaper Association.
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