Heat exchange fans help keep computer equipment cool at the Microsoft data center in Mount Pleasant, Wisconsin on Sept. 18, 2025. Microsoft announced plans to spend $4 billion to build a second data center in Mount Pleasant that it says will be the most advanced AI center in the world.
Caledonia residents learned that Microsoft is the company behind “Project Nova,” a proposed data center support project for the village.
Microsoft told village officials Sept. 23 that it intends to build facilities on 244 acres of land to support its far larger data center operation in Mount Pleasant.
Before its effort in Caledonia was made public, Microsoft announced a second $4 billion data center on Sept. 18 to go with its first data center which is planned to be fully built in 2026.
However unlike the property in Mount Pleasant, Microsoft would need to land to be rezoned, which is where the Caledonia officials come in.
“Offers have been accepted on land so that’s not a problem,” Caledonia Village President Tom Weatherston said in an interview with the Milwaukee Journal Sentinel. “That zone change if approved – if approved – reverses back if Microsoft doesn’t do anything in the next few years.”
Weatherston said most of the property is owned by We Energies and the rest of the land is owned by small farmers but he didn’t know the specific use.
“This week, as we introduce ourselves to neighbors in Caledonia, we look forward to working together to build a project that reflects the values and priorities important here – including those related to the character of the community and the environment.”
The company went on to say it plans to work with We Energies on a proposed rate plan to pay more for its energy usage and it emphasized its construction of a 250-megawatt solar plant in Portage County.
“Locally, Microsoft continues to expand partnerships that create direct connection with those who could benefit – including with the United Way of Racine County and Gateway Technical College for digital skills training, and Root Pike WIN and the Ecojustice Center on environmental sustainability. “
If the project moves forward and is approved, and Microsoft builds on it as intended, Weatherston said it would make the company “the largest taxpayer in the village.”
“Microsoft is a very environmentally friendly company and they tend to work very closely with the towns and villages. I see a lot of upside if this gets approved,” Weatherston said.
Laura Million, deputy director of Racine County Economic Development Corp., said Microsoft is seeking approval from the village to begin to design and build on the land.
“So the rezone portion of this is what’s most important to them at this point in time,” Million said. “Until (Microsoft) gets into the details of planning the site, we won’t have a clear understanding of what kind of investment is going to be there.”
And unlike the development in Mount Pleasant, there is no tax incremental finance district associated with this project which could mean more revenue for the village.
While residents may have not enjoyed the secrecy that came with this development, Million said Microsoft is being cautious.
“They want to be a good community partner, that’s why they’re coming out at this point in time,” Million said. “It’s an opportunity for Microsoft to address residents, concerns, and there will be even more information next week at the public hearing at the Plan Commission.”
On Sept. 24, residents can ask questions of village and company officials at an informational session at 5 p.m. at Caledonia Village Hall 5043 Chester Ln.
The Plan Commission is scheduled to meet on Sept. 29 to discuss and vote on the rezone of the project. If it is approved it goes to the Village Board on Oct. 14.
At the Sept. 9 village board meeting, several residents spoke against the prospect of a data center before it was publicly known the company was going to be Microsoft.
Weatherston said he’s been urging Microsoft to be more public with its plans for the village.
“In the absence of the truth people make up their own story,” Weatherston said.
Dale Kooyenga, president and CED of Metropolitan Milwaukee Association of Commerce, said this development is “part of a Microsoft integrated strategy across the region.”
“It’s not a stand-alone project. This has been given tremendous throught,” Kooyenga said adding the amount of water Microsoft is planning to use is not as large as some in the community think.
“There is no industry that’s moving as fast and as dynamically as the data center industry and powering AI,” Kooyenga said. “You always have to manage this delicate balance between transparency and between good information.”
