Wisconsin state utility regulators have approved two massive natural gas-fired power plants built to supply electricity for a wave of artificial intelligence data centers spreading across the southeastern part of the state, even as regulators themselves voiced frustration over the looser standards applied to projects built by private developers. The plants, developed by Chicago-based Invenergy, will serve data center campuses that are reshaping the region's power demands and its skyline.
The two approved facilities are the 324-megawatt Foundry Ridge Energy Center in the Town of Darien in Walworth County and the 1,186-megawatt Red Oak Ridge Energy Center in the Town of Paris in Kenosha County, representing a combined $2.26 billion investment, according to Utility Dive. As reported by the Milwaukee Journal Sentinel, the approval came even as the same regulators who signed off on the projects expressed frustration about the narrower review standards that apply to private developers like Invenergy compared with traditional regulated utilities.
Electric utility We Energies has already filed regulatory applications to buy both gas plants from Invenergy for an estimated $2.3 billion, with the goal of using them to power large data center additions within its service territory, Wisconsin Watch reports. The arrangement means a private developer builds the plants first, outside the scrutiny applied to utility-led projects, and the utility acquires them afterward for inclusion in the rate base that customers ultimately help pay down.
Why Regulators Had Limited Power to Say No
The frustration voiced by commissioners traces back to a quirk in state law. Under Wisconsin energy statutes, non-utility merchant power developers like Invenergy are exempt from having to show that a proposed facility satisfies a reasonable need of the public, a standard that traditional regulated utilities must meet before building new generation, per the Gazette Extra.
That exemption stems from how state regulatory rules split the review process into separate proceedings for independent power producers, according to the Union of Concerned Scientists. The structure forces regulators to evaluate plant construction in isolation, without simultaneously weighing overall public need, cleaner energy alternatives, or the eventual cost to ratepayers — a setup critics describe as a loophole that favors developers and the utilities that later buy their plants.
Microsoft, OpenAI and Oracle Are Driving the Demand
The power behind the push is unmistakably tied to the region's tech buildout. The approved plants are intended to supply electricity for major corporate technology hubs in Southeast Wisconsin, including Microsoft's multi-billion-dollar data center campus in Mount Pleasant and a Vantage facility leased to OpenAI and Oracle, Utility Dive reports.
That demand is not isolated to a couple of campuses. A Public Service Commission of Wisconsin draft report anticipates that statewide electric demand could increase by more than 40% by 2032, driven largely by hyperscale data center developments, according to WTMJ. Hoodline has previously covered resident pushback against the scale of Microsoft's Racine County expansion.
Public Hearings Drew Overwhelming Opposition
Residents did not go quietly. Public hearings on the two plant proposals saw overwhelming community opposition, with 82% of speakers opposing the Foundry Ridge project and 88% opposing Red Oak Ridge, alongside public comments and broader concerns over air pollution, water resources, and rising utility rates, the Sierra Club reports.
Those concerns are backed by health research. Academic research from the University of Wisconsin-Madison estimated that fine particulate matter pollution over the 30-year lifespan of both plants could cause $1.38 billion to $1.4 billion in nationwide health damages and lead to 118 premature deaths, the Union of Concerned Scientists notes.
Ratepayer Protections and a Statewide Gas Buildout
In April, the Public Service Commission altered We Energies' tariff rules, requiring large data center customers to sign 15-year minimum power contracts, according to the Citizens Utility Board of Wisconsin. Hoodline previously reported on how that same tariff shift fits into broader local fights over data centers in its coverage of Milwaukee's data center pause.
The Foundry Ridge and Red Oak Ridge approvals are not an isolated move. They reflect a broader regional surge in fossil fuel generation, with We Energies filing plans in October for a 750-megawatt natural gas plant in Wrightstown — the seventh new gas plant proposed in Wisconsin over roughly two years, Urban Milwaukee reports. As Wisconsin's tech-driven power demand keeps climbing, the tension between hyperscale data center growth and the state's existing regulatory guardrails shows no sign of easing.
