Last week, Ohio Gov. Mike DeWine (R) announced that he directed the chair of the Ohio Tax Credit Authority to pause consideration of any new data center tax exemption requests while the Ohio General Assembly’s Joint Data Center Committee studies the growth of data centers in the Buckeye State. More specifically, the Joint Data Center Committee will study ways in which data centers impact energy use and rates, the environment, and local communities.
In a world where governors have been tripping over themselves to welcome this technological and economic development to their states, DeWine’s announcement is a refreshing change of pace.
According to the Office of the Ohio Consumers’ Counsel, the Buckeye State is home to more than 200 data centers, earning it the ranking of fifth in the country for data centers. DeWine noted in his announcement that, “One of the reasons Ohio has been so successful in attracting new businesses and creating jobs is that we have invested in the data infrastructure needed to support complex technological innovation.”
Data centers initially appear as technological gold mines for economic development and have the power to entice even the most technologically averse governor. However, if states that choose to host these data centers do not have the resources or the infrastructure to support the energy behemoths, all citizens will feel an added financial burden each month when it’s time to pay their electricity bills.
A governor’s decision to welcome these massive data centers into one’s own state, community, and energy grid is one not to be taken lightly. Much less is it a decision that should be aggressively incentivized with tax exemptions.
Gov. DeWine’s decision to halt tax incentives for any future data centers acknowledges this fact.
As data centers have become increasingly mainstream in daily discourse, it is natural for Americans to have concerns about what exactly the development of data centers will do to their local community. With new technology comes uncharted paths and decisions.
These decisions branch into a myriad of disciplines, from land use to energy siting, energy grid reliability, energy transmission infrastructure, jobs, taxes, internet privacy and security, and so much more.
However, one of the most vital components of data centers lies at the heart of what feeds the behemoths. What it consumes. Energy. Thus, the topic of energy is most likely at the forefront of the discussions and deliberations about data center development among the Ohio General Assembly’s Joint Data Center Committee.
The large-scale energy demands of data centers in states that do not prioritize affordable and reliable sources of energy will almost certainly lead to disruptions in energy availability and increased costs for ratepayers. In these cases, data center development is harmful to a state’s economic well-being and irresponsible to citizens in the surrounding communities.
This is a proven phenomenon. According to a September 2025 report from the Union of Concerned Scientists (UCS), in seven states serviced by the large, regional transmission organization PJM Interconnection—Illinois, Maryland, New Jersey, Ohio, Pennsylvania, Virginia, and West Virginia—utility customers have collectively paid $4.3 billion for transmission upgrades needed to connect large data centers in 2024 alone.
To be a good fit for data centers, to protect ratepayers, and to ensure prosperity for Ohio, the Ohio Legislature, utility companies, and Public Utilities Commission of Ohio should prioritize energy affordability, reliability, and full-spectrum cleanliness. This energy renaissance will result in economic prosperity.
Presently, the Ohio Legislature is considering Ohio Senate Bill 294, which would guide the state’s Power Siting Board on the intent of the General Assembly that the energy powering the Buckeye State should be “affordable, reliable and clean.” Moreover, the energy produced and the way it is produced shall rely on domestically sourced materials and “minimize reliance” on “foreign adversary nations for critical materials or manufacturing.”
At a time when many states are bidding for data center development, a critical look at the effects associated with it is crucial and forward-thinking. If Ohio wishes to remain among the top states for data center development and wishes to continue its tax exemptions to do so, the Ohio General Assembly’s Joint Data Center Committee, along with Gov. DeWine, should prioritize sound energy policy.
Samantha Fillmore (sfillmore@heartland.org) is the senior state government relations manager at The Heartland Institute.
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