Hearing backlash from residents, cities and counties across the country in recent weeks have blocked planned data centers amid concerns over rising electricity prices and environmental harms.

The local actions come as state lawmakers also are looking to limit or repeal the incentives for the centers, which are sprawling campuses of computer servers that store and transmit the data behind apps and websites.

Supporters of the pauses say cities need rules before projects arrive, especially to answer residential concerns about electricity use, energy costs and nuisance issues. Industry supporters argue data centers bring jobs and tax revenue and are an essential part of the nation’s digital infrastructure. They warn that communities that block data centers are sacrificing those benefits.

The Denver City Council this month unanimously approved a one-year moratorium on data centers, halting new zoning permits and site development plans while the city drafts rules for future projects. In April, Oklahoma City approved a similar moratorium that will be in effect until the end of this year, or until the city updates its zoning code. Tulsa, Oklahoma, also approved a temporary stop on new data center construction, though major projects already in the pipeline will be allowed to proceed.

Smaller communities are taking similar steps.

In Illinois, both Bloomington and Normal earlier this month approved six-month moratoriums, and Morgan County took the same action in April. In Michigan, Huron County this week approved a three-year moratorium, joining roughly 20 other Michigan communities that have paused data center construction.

In Georgia, Camden County enacted a six-month moratorium earlier this month, becoming the first community on the state’s coast to do so. And a cluster of counties in North Carolina have hit pause, including Chatham County in February and Orange County (which includes Chapel Hill) in April.

But not all cities are souring on data centers: Cheyenne, Wyoming, this week opted not to proceed with a one-year moratorium after a lengthy public hearing.

A study released at the end of 2024 by researchers at the Lawrence Berkeley National Laboratory estimated U.S. data centers used about 4.4% of U.S. electricity in 2023, with projected use rising to between 6.7% and 12% by 2028.

A March Gallup poll found that seven in 10 Americans would oppose the nearby construction of data centers for artificial intelligence (AI), higher than the 53% of respondents who said they would oppose living near a nuclear power plant.

Stateline reporter Robbie Sequeira can be reached at rsequeira@stateline.org

WASHINGTON — Higher electric rates? Massive data centers looming over neighborhoods? Ugly political fights over what to do about them?

The future of data centers and their huge appetite for electricity is quickly escalating as a political flashpoint from coast to coast, moving from cities and states now to the nation’s capital. 

Bills are under debate in Congress. The Trump administration has weighed in. Lobbying is intensifying. The Environmental  Protection Agency is proposing changes.

But finding consensus on how to proceed in D.C. is tough, with the industry spreading around millions to make its case, some lawmakers pushing a moratorium, and others looking for ways to ease the burden on Americans without halting development. 

At the grassroots, intense opposition continues breaking out. In early May, community members screamed and booed when commissioners in Box Elder County, Utah, unanimously approved two resolutions in support of a 40,000-acre data center campus proposed for an unincorporated site in the county. 

Asked if he sees any momentum in Congress to do anything significant about the potential spread of data centers, Sen. Josh Hawley, R-Mo., said in an interview, “Only with voters.” 

Hawley and Sen. Richard Blumenthal, D-Conn., are pushing a plan to assure consumers they will pay no increases in utility rates because of data centers.

Getting Congress to act is more complicated. “Some communities may have too many, but some would like the opportunity to have one of these data centers that pay a lot of local taxes,” Sen. Tim Kaine, D-Va., who represents a state embroiled in its own fight over the issue, said in an interview.

There is general agreement that the issues need exploring, and fast.

“Demand for reliable energy is rising faster than at any point in history. Clearly, we will need more generation and transmission, and a great deal more of it,” said House Energy Subcommittee Chairman Robert Latta, R-Ohio, at a May 13 hearing. 

The Data Center Coalition, the industry’s membership association, says it’s eager to work with lawmakers and consumers.

“Data centers power modern life—from telehealth and digital classrooms to banking, air travel, financial transactions, and online shopping. With the average household using more than 20 connected devices, this infrastructure is not optional; it is foundational,” said Cy McNeill, coalition senior director of federal affairs.

“The data center industry is committed to being a good neighbor in communities where it operates, which includes the responsible use of key resources like water and energy,” he said

What are data centers?

Data centers in 2023 used about 4.4% of total U.S. electricity,  according to a report from the Lawrence Berkeley National Laboratory.

It predicted that percentage could double or triple by 2028 to meet the needs of growing amounts of data, notably artificial intelligence.

A data center is “a physical facility that houses and runs large computer systems,” said a report from the nonpartisan Congressional Research Service.

As AI needs grow, CRS said, so have hyperscale data centers. These tend to contain at least 5,000 computer servers and at least 10,000 square feet of space, roughly four to five times the size of a standard single family home. 

All this can impact consumers. A ratepayer’s bill is generally determined by how much it costs to generate electricity and to deliver it. Rates are generally set by state or local regulators.

CRS found in its May 12 report that in most areas of the country, “little evidence existed that data center demand was affecting electricity rates nationwide.”

Can data center development be stopped?

Sen. Bernie Sanders, a Vermont independent, and Rep. Alexandria Ocasio-Cortez, D-N.Y., are sponsoring moratorium legislation.

Their plan would bar new AI data centers until “strong national safeguards are in place” that ensure AI is safe and effective and the economic benefits of AI and robotics will benefit workers.

The government would also have to guarantee that AI does not increase electricity or utility prices or harm the environment.

That idea has gained little traction. A moratorium “would be suicidal for the country,” said Rep. Gary Palmer, R-Ala., a House Energy Subcommittee member.

Kaine explained the concern: ”The idea of a moratorium basically would be saying to all our competitors in the world we have an edge on this now but we’re going to let you catch up and race ahead of us.”

One area where he thought lawmakers could find common ground involved permitting reform. Data centers now can need different permits, depending on their location, function and other factors.

Tackling permit reform could be complex, as most of the process falls to states. As CRS wrote, “Data centers require permits for various aspects of their construction — such as roads, buildings, telecommunications, and utilities “

That can include permits for connections to the local electric grid, any on-site electricity generation, and backup electricity facilities, CRS said, as well as connections to the local natural gas pipeline system.

The Environmental Protection Agency on May 11 took one step, proposing making it easier for data centers and other projects to start construction even though they haven’t yet received federal clean air permits.

“The change will support the development of Artificial Intelligence infrastructure and power generation” an EPA statement said.

It called the proposal “a significant step forward in the Trump EPA’s efforts to provide affordable baseload power for American families and to advance the data centers essential to making the U.S. the AI capital of the world.” 

In addition, the White House in March announced a “Ratepayer Protection Pledge” aimed at companies involved with centers. Major tech companies agreed to its points.

It says that “Companies will build, bring, or buy the new generation resources and electricity needed to satisfy their new energy demands, paying the full cost of those resources whether by building, or buying from, new or otherwise additive power plants.”

Where possible, these companies will also add more capacity that serves the broader public by increasing supply. 

Congress wants more guardrails

Saying “a handshake and a promise from these tech companies is not enough”  Rep. Greg Landsman, D-Ohio, last month introduced legislation to guarantee data centers “pay the full cost of their energy demands and infrastructure needs (and) studies the environmental impacts of data centers.”

Other legislative initiatives include:

–The Energy Bills Relief Act. With 148 Democratic sponsors, led by Reps. Mike Levin, D-Calif., and Sean Casten, D-Ill., it would ensure that “facilities like data centers are paying for their own costs because it’s not fair for their expenses to be pushed onto your household if one opens in your area.”

–The Guaranteeing Rate Insulation from Data Centers (GRID Act).  The Hawley-Blumenthal plan would guarantee no increase in consumer utility prices due to data centers, and make sure that new data centers “use energy from power generation sources that are separate from the grid.”

–The Power for the People Act, which has Democratic support in the House and Senate. It would direct the Federal Energy Regulatory Commission to make sure data centers pay for local transmission upgrades they need.

The bill “balances the need for data center development without pushing those costs onto consumers,” said Rep. Paul Tonko, D-N.Y., its chief House sponsor.

–The Fair Allocation of Interstate Rates Act.  Sponsored by Rep. Julie Fedorchak, R-N.D., It would “prevent households from being forced to subsidize transmission projects built to satisfy another state’s green energy goals.” 

Currently, regional transmission groups spread costs of big interstate lines to consumers throughout the region.

Latta, the subcommittee chairman, called it “a practical solution to place the burden of renewable portfolio standard costs on the states that choose to adopt those requirements.”

What’s standing in the way?

Politics and, as Hawley put it, “M-o-n–e-y.”

OpenSecrets, a nonpartisan organization that tracks money in politics, found “The electric manufacturing and equipment sector, including firms like Microsoft and Oracle, has poured more than $226 million into lobbying activity in 2025.”

That spending is aimed in part at backing what OpenSecrets called “the rapid growth of data centers and to address the resulting strain on the nation’s power grid.”

The Data Center Coalition’s McNeill said the industry “is committed to working with communities, local officials, and state and federal leaders to ensure the continued responsible development of this critical industry while protecting families and businesses.”

The Data Center Coalition, he said, “will continue to provide education on the data center industry and look forward to continued engagement with the administration, Congress, and other key stakeholders.”

Also, the data center issue has become bound with other incendiary matters. 

Discussing the moratorium idea, Rep. August Pfluger, R-Texas, said in an interview, “Of course they (Democrats) are pushing for that. They’re anti-building, they’re anti-American, they’re anti-everything. They’d rather see Iranian oil be sold in the United States.”

Democrats charge that Republicans are resisting meaningful regulation.

At one of the House hearings, Rep. Jenn McClellan, D-Va., tied the problems to the war in Iran.

“Not until the Trump administration carelessly ensnared the United States in a reckless and costly war of choice with Iran pushing energy prices up even higher,” she said, “that we focused a hearing specifically addressing the alarming impact that data centers could have on energy affordability going forward.”

All three members of the Public Service Commission criticized the lack of transparency from Meta and Alliant Energy during a meeting Thursday in which the body approved a contract for the social media giant to obtain power for its planned data center in Beaver Dam. 

Meta is in the process of spending more than $1 billion to construct a hyperscale data center campus that, when completed, would use six to eight times more power than the city of Beaver Dam’s current energy load. 

Like similar massive data center projects across the state, Meta’s Beaver Dam project has drawn opposition from local residents. For months, the project was shrouded in secrecy with Meta operating under the name Degas LLC. Opponents have complained about the lack of openness, the massive use of energy and the impact the construction and operation of the center could have on the community. 

PSC Chair Summer Strand said in her opening remarks she didn’t understand “why it needed to be this difficult” to achieve a transparent process. 

“To me, transparency is not a cliche, feel good, bare minimum, check the box concept,” Strand said. “If there’s one takeaway from our discussion and decisions today I want it to be clear that, whether you’re a large load customer coming into Wisconsin for the first time, or regulated entity familiar with our process, transparency — and by that I mean actual and real transparency — is the foundational expectation and a necessity.”

Commissioner Kristy Nieto said in her opening remarks Thursday morning that the case is one of the “most consequential” decisions the PSC has seen. 

“It bears repeating, existing Wisconsin customers should not pay a single cent to subsidize the service of data centers, not now and not decades from now,” Nieto said. “This means these very large customers must bear the full cost of the infrastructure required to serve them — generation, transmission and distribution — and that those costs must be fully and transparently assigned.” 

The three members of the commission lamented the redactions that had initially been made to the documents submitted in the case — which were later removed after objections from outside parties including members of the public, Clean Wisconsin and the Citizens Utility Board. 

The commissioners also decided that moving forward, hyperscale data centers constructed within Alliant’s territory must pay for and receive energy through a standardized tariff, rather than a one-off contract negotiated without public scrutiny. Late last month, the PSC made a similar ruling for large customers in WE Energies territory. 

Under the PSC order, Alliant will have to develop a tariff that applies for any data centers using more than 100 megawatts of energy. The Meta campus is expected to use 220 megawatts. 

“This is not going to be the last data center contract we see from this utility, and I will say Alliant needs standard guidelines and rules for its data center customers,” Nieto said. “A clear public tariff would create consistent, transparent rates and rules for future data centers, instead of handling each one through separate, confidential negotiations.”

While Alliant was ordered to develop a tariff rate for large customers, the PSC on Thursday approved the contract negotiated between Meta and Alliant with some modifications meant to insulate regular customers from bearing the costs of Meta’s energy use and any related infrastructure upgrades by Alliant. Nieto said denying the agreement while the tariff rate is developed would have allowed Meta to operate for up to a year without any guardrails, an outcome she said didn’t think would benefit anyone.

Brett Korte, a staff attorney with Clean Wisconsin, said the PSC putting a halt to the development of a case-by-case patchwork of data center energy deals in Alliant’s territory — which covers parts of more than a dozen Wisconsin counties — will protect Wisconsinites.

“Tariffs create a consistent, transparent framework that helps protect the public interest,” Korte said in a statement. “Without them, Wisconsin risks a patchwork system where costs and responsibilities are unclear and potentially shifted onto other utility customers.”

After the meeting, consumer advocacy and environmental groups were complimentary of the PSC’s actions.

“Today, the Public Service Commission highlighted the importance of transparency and oversight: accountability is a must, and it cannot be bypassed,” Britnie Remer, organizing director of climate advocacy group 350 Wisconsin. “The Commission also recognized that protecting Wisconsinites from subsidizing billion-dollar data centers needs to be front and center when it comes to these massive projects. With more data center proposals inevitable, requiring tariff filings in the future will ensure large energy customers pay for their costs, not our families and small businesses.”

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The Wisconsin Department of Natural Resources held a public hearing Tuesday on a request from the AI data center company Vantage for an air quality permit to operate 45 diesel backup generators at the company’s proposed hyperscale data center in Port Washington.

The department has already granted a preliminary approval to the permit request. Members of the public complained at the virtual hearing that the DNR chose not to conduct a full environmental impact assessment — despite southeastern Wisconsin’s existing classification as a high air pollution region. 

Michael Greif, an attorney with Midwest Environmental Advocates, said that all 45 generators operating at once for one hour would emit the same amount of nitrogen oxides as more than 5 million cars driving over one mile of nearby Interstate 43 — or seven times the hourly nitrogen oxide emissions for all of Ozaukee County. Exposure to nitrogen oxides have been tied to respiratory issues such as asthma. 

“It is also one of the first hyper scale AI data centers proposed in Wisconsin,” Grief said. “So it raises new and unreserved questions about energy use, climate impacts, air pollution and public health, and for all those reasons and more, DNR is legally required to prepare an EIS for the Vantage data center.”

Residents of the area put it more simply, complaining about the air pollution they’re already dealing with every day. 

“Our lakeshore is at capacity,” Sheboygan resident Rebecca Clarke said. 

Many speakers also expressed frustration at their lack of a voice in the state’s surge in data center development and proposals. 

“This community has not been given a fair process,” Port Washington resident Carri Prom said. “We’ve been speaking about this process for months. We’ve largely been ignored, and yet, here we are.”

The air pollution permit is one of the DNR’s few chances to weigh in on a data center proposal that has drawn widespread opposition in Port Washington and across the state. The Public Service Commission, the agency that regulates utility companies in Wisconsin, has given the public little confidence it will do enough to prevent electric bills from increasing.

Local zoning boards and city councils, enticed by the promise of property tax revenue, have often signed off on data centers after agreeing to non-disclosure agreements to keep the details away from their constituents. 

“I think things are very backwards, and that we’re proceeding with all of these projects before we even have any idea of how to protect residents,” said Sarah Zarling, an environmental organizer who’s been involved in the data center fight. 

Over the past year, as the number of data centers operating, under construction or proposed has continued to increase, public opposition has grown. Multiple pieces of legislation for regulating data centers were proposed by lawmakers of both parties, yet none passed  before legislators adjourned for the year. Data centers have become a big issue in the Democratic primary for governor and a number of environmental groups have called for a moratorium on data center development until stricter regulations can be put into law. 

Brett Korte, a staff attorney at Clean Wisconsin, told the Wisconsin Examiner in a statement after Tuesday’s hearing that the disconnected government approval process only highlights Wisconsin’s lack of a coherent plan.

“One of the pressing issues related to the data center boom currently underway in Wisconsin is that there is no overarching plan to ensure they don’t harm communities in our state,” he said. “Nor is there even an effort to fully understand the harm they will cause. Local governments make zoning decisions, the PSC approves the construction of power plants and transmission lines, and the DNR implements water regulations and issues air permits.” Yet no state office is responsible for looking at all of the issues raised by data centers at once.

Korte added that a better process for planning future renewable energy sources, stronger carbon emission standards and a more concrete plan for achieving Gov. Tony Evers’ goal of powering the state with 100% clean energy by 2050 would help the state better manage data center growth. 

“No one is asking: Do the benefits of data centers outweigh their environmental harm?” he continued. “That is why Clean Wisconsin continues to call for a pause on data center construction until the state has a comprehensive plan to regulate their development.”

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Lawmakers have given final approval to a moratorium on data centers larger than 20 megawatts — the first statewide ban of its kind in the country.

“What we’re talking about here is an ability for us to absorb and understand the impact of data centers potentially on the State of Maine,” Sen. Mark Lawrence (D-York) said Wednesday ahead of the Senate vote. “The states that have had data centers come in have had tremendous impacts.”

The bill, LD 307, bans data centers larger than 20 megawatts until November, 2027. It also creates the Maine Data Center Coordination Council, and instructs the council to provide strategic input, facilitate planning considerations and evaluate policy tools to address data center opportunities.

“We’ve seen across the U.S. the rapid expansion of AI data centers, with few to no safeguards to insulate people from shocks to electricity demand, impacts to local water supplies, and more,” Maine Conservation Voters said in a statement. “LD 307 will help protect Maine people and the environment, pushing pause on large-scale data centers to ensure strategic and strong policies and protections are in place first.”

The bill was passed in both chambers this week, and is now awaiting funding on the special appropriations table.

“My point here is not that data centers should never happen,” said Sen. Nicole Grohoski (D-Hancock) Wednesday. “The point is we do not have the correct regulatory regime on the books to ensure that a decision like this isn’t neutral, at a minimum, or positive for everyone that would be affected by that decision.”

Discussion in both the Senate and Maine House of Representatives focused on the impact on proposed data center projects, primarily one in Jay and another in Sanford. Lawmakers volleyed back and forth on the potential benefits to a former mill town like Jay, and possible negative impacts to the surrounding areas. They also considered an amendment that would have created an exemption process to the moratorium that was ultimately rejected by both chambers.

“I’m not going to support something that doesn’t support business, the expansion of business in the State of Maine, especially in a community that’s dying for commerce and to get back on its feet,” said Sen. Jeff Timberlake (R-Androscoggin).

Republican lawmakers also raised concerns that Maine would lose out on economic opportunities, but would still feel the negative impacts when the data centers are built in other states.

“These projects are going to happen whether or not we pass this moratorium,” said Sen. Matt Harrington (R-York). “For those who care about the environment, they will be built in states that use 70% coal power, and we will be the tailpipe for that. These data centers will be built in groves in states that don’t have an economic death wish, and we will receive all the negative environmental impacts of that.”

Rep. Steven Foster (R-Dexter) said in March that any data centers are already subject to environmental and local regulations.

“This moratorium is not needed here in the state of Maine,” Foster said. “A lot of fear has been stoked up about an AI data center being built anywhere in Maine, which is contrary to reality. We would not see the facilities here the size of those being built in other states.”

But Democrats countered that Maine residents can’t afford the potential costs from the projects.

“We’re already seeing a tremendous impact from rising gas prices, rising oil prices, and how that feeds into also rising electric energy prices,” Lawrence said. “We don’t need to add an additional risk on energy costs for Mainers when we have time to reflect on this, study this and do this right.”

Grohoski also pointed to the local opposition to data centers, and said if the state doesn’t take the time to build intentional regulations, residents may just continue to stop projects at the local level.

“So I think if we do think that Maine is a place where we would like data centers at some point, if we don’t figure out how to do it right, they’re not going to happen anyhow, because people are concerned that we have not done our jobs to protect them,” Grohoski said.

In March, Rep. Melanie Sachs (D-Freeport) argued that the moratorium is not against innovation.

“Maine has always been a place that embraces new industries and new ideas, but we are also a state that understands the value of stewardship of our land, our water, our communities and our long-term future,” she said.