The parent company of We Energies will need to add even more electrical generation capacity to meet the energy demands of recently announced data center projects, the company's CEO told analysts on an earnings call Tuesday.
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WEC Energy Group is already making significant investments in its electricity generation capacity to meet around 1,800 megawatts of additional demand in southeastern Wisconsin. That increase is primarily being driven by Microsoft’s data center currently under development in Mount Pleasant, but also includes other economic development projects as well.
In response to that demand, WEC Energy planned $13.2 billion worth of investments in electric generation as part of its 2025 to 2029 capital plan. The previous plan, covering 2024 to 2028, included $9.5 billion in electric generation.
The company already has around $5 billion worth of projects proposed and pending approvals from the state Public Service Commission.
The most recent plan includes $9.1 billion for renewable power generation and around $2.7 billion for natural gas-powered electricity generation.
However, since the most recent plan was unveiled in the fall, multiple new data center projects have emerged, including one in Port Washington by Cloverleaf and another Microsoft site in Kenosha. OpenAI executives also recently indicated Wisconsin is one of the states under consideration for some of the $500 million worth of investment planned by Stargate.
Scott Lauber, chief executive officer of WEC Energy Group, said Tuesday that the 2025-2029 plan did not contemplate any of the recently announced demand. The Cloverleaf project alone could represent an additional gigawatt of electric demand.
“It’s early stages yet,” Lauber said of the project, suggesting the exact demand needs would come into focus as the project moves forward. He indicated he had seen some suggestion the demand could be even greater.
For a data center project to go from a farm field to drawing a significant amount of energy is generally a three to four year process, Lauber said. That means even if the Cloverleaf project begins construction this fall, which Lauber said is possible, it wouldn’t be a major customer until 2028 or 2029.
WEC does not plan to immediately update its capital plans to account for the increase in demand, rather, Lauber said the company would work over the summer with those proposing projects to understand their needs. A new plan would be announced in the fall, around the time WEC typically updates its capital investment plans.
“There’s not excess capacity out there,” Lauber said of the current plan. “This would all be incremental support that we’d need for reliable capacity, so that will be reflected in our updated capital plans going forward.”
At the same time, the Chinese firm DeepSeek has unveiled significant advances in AI training efficiency, causing some to wonder if investments in data centers and related energy generation will ultimately be needed. Lauber said he was listening in to the earnings calls of Microsoft and other technology leaders to gain additional insight.
“Everything I’ve heard is if AI becomes more efficient, more people will use it and the demand will still be there,” he said. “All our capacity plans and all our growth plans are still intact. There’s no changes there.”
Lauber noted customers are not only looking for reliable sources of energy to support data centers but also want renewable sources incorporated as well. He was asked directly if policy priorities in President Donald Trump’s administration could have any implications for the use of renewables.
“There’s a potential and we’re evaluating all of that as we see what goes on with the administration and the tariffs and production tax credits,” Lauber said. “I do think the PTCs will continue and they won’t just be phased out immediately. I think there’s a longer term benefit for a lot of people. A lot of construction jobs, a lot of value for our customers. So I’m not anticipating big changes there, but of course all of us, including our large customers, are watching it. At this time, I don’t see any issues on the horizon.”
As for what data center customers will pay for their massive energy demands, that remains an open question. Lauber said WEC is “actively working” with these very large customers and anticipated a proposal would be submitted to the state Public Service Commission within the next six months.
“We’re all aligned on what we need to do in order to be fair on cost allocation and they all agree they need to pay their fair share,” Lauber said.
