US states push back against data centre boom as local opposition grows
The rapid expansion of data centres across the US is encountering growing resistance from communities and policymakers, with several states moving to restrict or temporarily halt new developments.
New York, Texas and Pennsylvania are among states considering or introducing moratoriums on proposed projects, according to CommercialCafe’s latest US industrial market report, which draws on Yardi Research data.
The shift comes as accelerating demand for digital infrastructure and AI computing capacity has made data centres an increasingly important source of investment, but has also intensified scrutiny of their impact on local power and water resources.
CommercialCafe cited concerns including energy consumption, higher utility bills for residents, tax incentives and environmental impacts as drivers of growing opposition. A Gallup poll referenced by the report found that around 70% of Americans were either strongly or somewhat opposed to a data centre being built near them.
The trend is also beginning to influence local politics, with data-centre development emerging as an issue in elections and public meetings.
Texas provides a particularly significant example. The state has actively sought data-centre investment and has the largest data-centre construction pipeline in the US, but Governor Greg Abbott has proposed a moratorium on new approvals while projects seeking connections to the state power grid are audited.
According to the report, concerns were heightened by the failure of some developers to respond to requests for information on their expected water and electricity use, highlighting the growing importance of transparency around the infrastructure requirements of major projects.
New York has meanwhile approved a one-year moratorium on hyperscale data-centre development to allow regulators to assess and mitigate its effects, while Pennsylvania has also joined states considering restrictions.
The emerging backlash could have implications for investment promotion as US states and cities attempt to balance demand for digital infrastructure with grid capacity, environmental considerations and community acceptance.
Peter Kolaczynski, director at Yardi Research, said opposition to data centres had increased significantly in recent months, exceeding the level of resistance the company had anticipated a year ago.
