The Midwest's rise to America's second-biggest data center hub is fueled by these key states

Construction for a Meta data center campus is underway in Beaver Dam, Wisconsin. Joe Timmerman/Wisconsin Watch via Getty Images 2026-04-14T09:00:06.113Z Share Copy link Email Facebook WhatsApp X LinkedIn Bluesky Threads lighning bolt icon An icon in the shape of a lightning bolt.

Impact Link Save Saved Read in app This story is available exclusively to Business Insider subscribers. Become an Insider and start reading now. Have an account? Log in. Northern Virginia has long been the center of the data center industry. That's changing as the biggest facilities shift inland in search of readily available power. Texas and the Midwest are becoming key hubs, according to a new Synergy report. AI-generated summary Summaries are generated by an AI model trained on Business Insider's articles. AI may make mistakes or provide inaccurate/incomplete information. We're unable to load that answer right now. Please try again. What factors drive data center locations? Why are data centers moving inland? How are tax incentives affecting data centers? How do data centers impact power grids? What role does Texas play in data centers? The AI boom is redrawing America's data center map. Loading audio narration... Texas and the Midwest are emerging as the key hubs for the largest and most powerful data centers for cloud and AI computing, shifting the industry's nexus away from Northern Virginia, a new report shows.The two regions accounted for one-third of hyperscale data center capacity at the end of 2025, according to Synergy, an IT market research firm. The two regions will account for 53% of new hyperscale data center capacity coming online in the next few years.Northern Virginia has long served as Big Tech's primary data center hub. Power availability is driving the shift inland, the report said. The companies building the largest and most powerful facilities are seeking land with readily available electricity. The sprawling data center buildout in the US is straining the nation's aging power grid and fueling concerns over rising electricity costs.Texas leads the country in new data center development by a wide margin, though the Midwest is quickly growing in importance, the report said. Wisconsin, Indiana, Michigan, and Missouri are fueling Midwestern growth.Wisconsin has attracted major data center projects from Meta, OpenAI, and Microsoft. Michigan houses an Oracle-backed Stargate data center. Amazon and Google are building massive data center campuses in Northern Indiana. Ohio is already one of the biggest data center markets in the country. Data centers in the state have received generous tax incentives, including 30-year property tax abatements in some cases.One factor in Texas's data center boom is the BYOP (bring your own power) phenomenon. A number of data centers in the state, including the Stargate campus in Abilene, are avoiding the grid altogether and building their own on-site power plants, fueled mostly with natural gas. Have a tip for this reporter?

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