Michigan Regulators Approve Power Deal for Multi-Billion Dollar Oracle-OpenAI Data Center
December 19, 2025
Michigan regulators have given the green light to a critical power agreement for a massive new data center, highlighting both the immense scale of modern computing infrastructure and the growing public scrutiny it faces. The decision underscores a pivotal tension in the U.S. energy landscape, where the voracious power demands of artificial intelligence and cloud computing are colliding with grid reliability and community concerns.
On Thursday, the Michigan Public Service Commission unanimously approved a request from utility DTE Energy Co. to supply power to a planned $14 billion data center development in Saline Township, backed by tech giants Oracle and OpenAI. The facility is projected to require a staggering 1.4 gigawatts of electricity—a capacity comparable to a large nuclear power plant. During a contentious hearing, regulators concluded that the proposed contracts between DTE and the tech firms would protect the broader power grid and provide a net financial benefit to the utility's other customers.
Dan Scripps, chair of the commission, emphasized the protective measures within the agreements. "They show a net financial benefit to DTE’s other customers," Scripps stated, adding that the contracts require significant upfront collateral from Oracle and OpenAI. "The contract doesn’t assume the customer will stay financially solvent," he noted. The deal includes provisions such as minimum monthly charges and a termination fee for DTE, according to regulatory filings. Analysts from Citigroup Inc. pointed out that the agreement designates the hyperscale data center as the first to be cut off during a system emergency, a safeguard meant to prioritize public power supply.
The Saline Township campus, part of OpenAI's broader "Stargate" initiative, represents a fraction of the company's ambitious U.S. expansion plans. OpenAI has previously announced intentions to develop 8 gigawatts of data center capacity nationwide, involving more than $450 billion in investment over the next three years alongside its partners. The regulatory approval process, however, was marked by significant public opposition, reflecting a broader, increasingly hostile environment for data center developments in certain U.S. regions. Analysts at BMO Capital Markets warned in a client note that this case signals growing scrutiny, potentially challenging future deals.
The commission's approval removes a major hurdle for one of the largest data center projects currently envisioned, enabling a key phase of financing and construction. The outcome is being closely watched by the industry as a bellwether for how communities and regulators balance the economic promise of multi-billion dollar tech investments against the practical strains on local energy infrastructure.
Source: yahoo
