The backlash against AI data centers and their power and water costs

Rising power bills fed the anger. A summer auction by PJM Interconnection, the largest US grid operator, was expected to add $6.3 billion to bills across 13 Eastern states and the District of Columbia over three years,^[13] and one Ohio brickmaker's electricity costs rose 90% in a year, largely because of demand from data centers in the region.^[14] A Gallup poll in May found that most Americans opposed data centers in their communities,^[15] a Texas poll found 62% of rural Texans opposed them,^[16] and an Annenberg survey in August found that local opposition had risen sharply since the previous spring.^[17] By October, an ABC News/Washington Post/Ipsos poll found that about two-thirds of Americans opposed building new data centers.^[18]

Opponents took the fight to the streets and to town halls. Protests were planned in at least 125 places on one July weekend, the first coordinated national effort,^[19] and the AP found that the opposition in rural places like eastern Nebraska defied the usual partisan lines.^[1] A developer in Hazle Township, Pennsylvania, offered about 4,500 households $10,000 each and still met resistance.^[20] In Memphis, protesters took over a City Council meeting that ended in a fight, and the council later rejected a pause on new projects.^[21][22] In Hermantown, Minnesota, protesters filled City Hall and stopped a vote on a Google project.^[23]

Governors and local officials moved to slow the buildout. New York Gov. Kathy Hochul ordered a moratorium of up to a year on large data centers in July, the first statewide pause,^[24] and Pennsylvania Gov. Josh Shapiro, Massachusetts Gov. Maura Healey, Virginia Gov. Abigail Spanberger and Maryland Gov. Wes Moore issued orders of their own.^{[25][26][27][28]} California Gov. Gavin Newsom signed bills regulating the industry,^[29] Michigan Gov. Gretchen Whitmer asked companies to pledge that households would not pay for their power,^[30] and regulators in Oregon and Virginia shifted more of the cost of electricity and power lines onto data centers.^[31][32] Cities and counties went further. Prince William County, Virginia, rejected a 2,000-acre campus,^[33] neighboring Loudoun County, which has the country's highest concentration of data centers, moved to pause new ones for a year and persuaded Amazon to drop a project,^[34][35] and two Virginia state senators proposed a three-year statewide pause.^[36] San Francisco and Oakland imposed temporary moratoriums,^[37] Chicago Mayor Brandon Johnson called for one,^[38] and Austin weighed treating data centers like adult businesses under new rules.^[39]

Texas became the biggest test. Gov. Greg Abbott called in July for keeping data centers out of rural neighborhoods,^[40] then paused approvals in August until companies gave the state more information on their power and water use, sending up to 300 projects, mostly data centers, into an audit by the state's grid operator.^[41][42] Meta agreed to follow his standards,^[43] while Trump called Texas's opposition a "mistake,"^[44] and Abbott said developers had "dug their own grave" by failing to win local support.^[45] In September Abbott ordered state environmental regulators to pause all data center permits,^[46] though advocacy groups later found that related permits had been issued after his directive.^[47] Country singer Willie Nelson urged Texans to fight a data center planned near his hometown of Abbott,^[48] and Democrat Gina Hinojosa made the issue central to her campaign against the governor.^[49]

Water and pollution became fights of their own. Abbott ordered the state's water agency to penalize data centers that did not report their water use,^[50] Texas Attorney General Ken Paxton opened an investigation into hundreds that had not,^[51] and his office later sent letters to 156 developments demanding the information.^[52] The contamination of a Cheyenne, Wyoming, water system by a Meta data center deepened residents' worries there,^[53] Ohio's environmental agency dropped a proposed permit that would have let data centers discharge wastewater into lakes and streams after thousands of public comments,^[54] and a long-delayed Virginia study found that a critical aquifer was likely to decline.^[55] In New Jersey, a Microsoft-backed data center in Vineland was found running dozens of unpermitted gas generators,^[56] and Gov. Mikie Sherrill fined it a record $1.07 million;^[57] records later showed it had polluted the air for nearly a year before regulators stepped in.^[58] Another New Jersey data center spilled more than 5,000 gallons of diesel fuel into a tributary of the Hackensack River.^[59] Gas-fired power planned for data centers nearly doubled in the first half of 2026,^[60] and figures in the Make America Healthy Again movement warned Trump against using data centers to justify burning more coal.^[61]

States also began rolling back the tax breaks they had used to attract the industry.^[62] Texas lawmakers reconsidered sales tax exemptions whose estimated cost kept growing,^[63] North Dakota's tax commissioner reported exponential growth in exemptions for data center equipment,^[64] and Moore said he would seek to repeal Maryland's 2020 exemption.^[28] A report by Ownwell said Ohio and Illinois had paused their data center tax breaks in 2026.^[65] Some officials tried to make the companies pay their hosts instead: Hochul announced a voluntary benchmark of $1 million in community investment for every megawatt of demand,^[66] and Illinois lawmakers proposed bills requiring data centers to account for their power use and pay the cities where they are built.^[67][68]

In Washington, Trump unveiled a Ratepayer Protection Pledge in July, which 23 Republican governors were expected to sign, to keep households from absorbing data center costs,^[69] and his administration began repurposing federal land for data centers and the power plants to run them.^[70] He also attacked the opposition, saying in August that places that rejected data centers would live in "poverty, crime and squalor."^[3] The House passed a bipartisan bill aimed at making tech companies cover the centers' effect on electricity prices. Sen. Martin Heinrich, a New Mexico Democrat, blocked an attempt by Sen. Jon Husted, an Ohio Republican, to pass a Senate version by unanimous consent, arguing that it did not go far enough,^[71] and Senate Democrats blocked the bill at the end of September, calling it "toothless."^[72] The Environmental Protection Agency proposed rules that critics said would let data centers avoid disclosing their air pollution and make it harder for the public to comment on new projects.^[73][74] Trump floated a "dividend" for people living near data centers in late September,^[75] and on October 21 he said data centers must produce their own electricity and share any surplus with the communities around them.^[4][76]

The industry and its allies pushed back. Amazon and Meta each pledged $1 billion for communities that host their data centers,^[77][78] and tech companies promised hosts more money, fewer taxpayer handouts and fewer secrets.^[79] A pro-industry group ran ads in Oregon, Virginia and five other states,^[80] a labor-aligned group's report projected more than 120,000 jobs from planned Illinois projects,^[81] and Rep. Bruce Westerman said data centers get a "bad rap" and that the problems could be resolved.^[82] Some defenders blamed foreign influence. "Shark Tank" investor Kevin O'Leary was sued for defamation by two Utah groups after he said on Fox News that some opponents had ties to China,^[83] X said about 200 accounts from a suspected Chinese bot farm had pushed anti-data center posts,^[84] and House Speaker Mike Johnson called the opposition a "Chinese psyop" while saying developers had to earn communities' trust.^[85] A report found that nearly half of planned US data centers faced delays from power limits, equipment shortages and regulation,^[86] and Oracle invoked force majeure over a New Mexico project in case opposition and regulatory delays kept it from opening on time.^[87]

The backlash reshaped the midterm campaigns, with candidates in both parties racing to distance themselves from the industry.^[88] Florida Rep. Byron Donalds, a Republican running for governor, proposed making data centers supply their own power and water,^[89] and Republican Mike Rogers called for a one-year moratorium in the Michigan Senate race.^[90] In Texas, Ken Paxton unveiled a data center plan for his Senate campaign.^[91] In Ohio, a Republican memo called data centers "the anchor hanging around Husted's neck" in his race against Sherrod Brown,^[72] and Amy Acton and Vivek Ramaswamy laid out the limits they would put on data centers as governor.^[92] The issue came up in the Pennsylvania governor debate^[93] and dominated the Nevada governor race, in a state where 80% of the land is owned by the federal government.^[94] Polls showed voters skeptical but not fixated: one found 71% saying data centers' costs outweighed their benefits, while another found only 7% naming them a top-three issue.^[95] Trump kept campaigning for the industry, defending data centers at an Ohio rally in October.^[96]

The election results set off a scramble. On November 5 the Nasdaq fell more than 5% into correction territory as chip and AI shares sank on fears of tougher regulation after the Democrats' gains,^[97] and OpenAI said it would pay the full electricity costs of its future data centers, avoid nondisclosure agreements with host communities and wanted those terms written into law.^[98] It had already begun calling its data centers "compute campuses."^[99] The backlash did not carry everywhere: a North Dakota columnist wrote that voters there rejected candidates and measures aimed at stopping data centers.^[100]