US States Push Back Against Datacentres Over Energy Costs and Impact

Datacentre construction is facing growing opposition across the political spectrum in the United States, driven by concerns over environmental impact, energy costs, and broader societal implications.

More than a dozen states have considered moratoria on datacentres, with New York becoming the first to enact a temporary ban last month. Even conservative figures, including Texas Governor Greg Abbott, have called for restrictions on development in rural areas. Progressive lawmakers like Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez have proposed a national moratorium.

The backlash stems from multiple concerns, including excessive water usage, potential toxic contamination, and the societal direction of AI technologies. However, one of the most pressing issues is financial: datacentres consume vast amounts of electricity, which can drive up utility bills for residents.

A May poll found that 70% of Americans oppose local datacentre construction, with 48% strongly opposed. About 20% of opponents cited potential financial burdens, particularly higher electricity costs, as a key reason for their stance.

The opposition has put the Trump administration in a difficult position. While the administration aims to position the U.S. as a global leader in AI, it has also pledged to reduce electricity costs. In response, it introduced the "Ratepayer Protection Pledge," a voluntary agreement where companies commit to covering the costs of the electricity they use and the infrastructure needed to connect to the grid. Nearly 200 companies, utilities, and states have signed on.

Critics argue the pledge lacks enforcement. Patrick Drupp of the Sierra Club called it a "paper-thin commitment," while Lena Moffitt of Evergreen Action dismissed it as a "photo op with big tech." There are no legal consequences for companies that fail to comply.

Other proposals to prevent ratepayers from bearing the financial burden include imposing tariffs on datacentres or halting construction until energy regulations are established. Federal data shows that utility prices in June were 4% higher than the previous year, outpacing inflation, and concerns about costs remain unresolved.

Efforts to regulate the industry face challenges. A bipartisan bill intended to protect consumers from hidden costs failed to gain traction, and proposed datacentres, such as one near Mar-a-Lago, continue to spark local opposition over environmental risks. In Little Rock, residents have expressed outrage over two planned datacentres, with one resident describing the situation as "very real redlining."