Illinois Governor J.B. Pritzker recently issued an executive order pausing tax incentives for data centers as of July 1. The Data Center Program was created in 2019 by bipartisan legislation.
From 2020-2024, Illinois gave 27 data centers a collective $983 million in tax breaks in exchange for an investment commitment of $8.1 billion and the creation of 591 new full-time operation and maintenance jobs. That’s an average tax credit of about $1.66 million per job.
Governor Pritzker said that his administration will work with the General Assembly and stakeholders to find a solution that protects affordability, safeguards natural resources, and ensures responsible growth. A recent report from the Union of Concerned Scientists estimates that data center load growth in Illinois will increase electricity system costs by $24 billion to $37 billion (15 to 24 percent) by 2050.
Labor groups like Climate Jobs Illinois argue that the pause will send investment and union jobs to neighboring states sitting on the same regional grid as Illinois. Supporters of the pause argue that data centers have plenty of hyperlocal effects, forcing utilities to upgrade transmission and distribution infrastructure and consuming enormous amounts of water.
Lawmakers did not pass a hotly debated data center regulation bill this Spring, but negotiations will likely continue this summer and into Veto Session this fall.