Microsoft has officially withdrawn its proposal for a 244-acre data center in Caledonia, Wisconsin, following significant community backlash. The tech giant announced its decision in early October 2025, citing extensive feedback from local residents and officials who opposed the project known as "Project Nova." This move comes as Microsoft continues its broader AI infrastructure expansion across the region.
The proposed data center, planned for a site near Douglas Avenue, faced organized resistance from groups like "Stop Project Nova." Residents voiced concerns regarding the project's potential environmental impact, including high water and energy consumption, as well as the preservation of the area's rural character. Village Trustee Fran Martin commended Microsoft for listening, stating, "I commend Microsoft for listening to the community, and for also addressing the concerns that the community had."
Despite the withdrawal from Caledonia, Microsoft affirmed its commitment to investing in Southeast Wisconsin. "Based on the community feedback we heard, we have chosen not to move forward with this site; we remain committed to investing in Southeast Wisconsin," a Microsoft spokesperson stated. The company is actively seeking alternative locations within Racine County that align with both its development goals and community priorities.
This decision contrasts with Microsoft's ongoing plans for a second data center in nearby Mount Pleasant, which has encountered little opposition and is proceeding. The company has already invested billions in the region, with the first Mount Pleasant facility expected to open in 2026. This dual approach highlights the complexities tech companies face when expanding infrastructure in local communities.
The Caledonia situation is part of a broader trend of increasing community scrutiny and opposition to data center projects across Wisconsin and the United States. Other proposals in Port Washington and Menomonie have also faced significant pushback, often related to concerns about energy grid strain, water usage, and local environmental effects. This growing resistance underscores the need for developers to engage closely with communities to address their specific concerns.