The data-center backlash has broken into the midterms but the industry’s problem is larger than communications: America needs a new bargain

A new controversy surrounding data center construction has spilled over into the midterms, though the core issue extends beyond mere communication. President Trump himself recently called for the tech industry to improve its public relations efforts in light of growing opposition. This sentiment echoes throughout the nation as residents push back against the burden such projects place on communities.

From Ohio to Wyoming, candidates from both parties are distancing themselves from projects that were once championed by their predecessors. Pennsylvania's Governor Josh Shapiro recently took steps to address this problem by removing AI data centers from the state's fast-track program and instituting various requirements, including local approval, enforceable commitments on power and water usage, and the ban of non-disclosure agreements.

The public's perception is clear: companies reap the benefits while communities bear the brunt of potential long-term disadvantages. These disadvantages include higher electricity bills, increased infrastructure costs, prolonged construction disruption, and increased pressure on local water supplies. With some data centers even utilizing evaporative cooling systems, which require significant amounts of water to remove server heat, the issue becomes even more pressing.

Polls show that 71% of Americans oppose the establishment of an AI data center in their area. A survey of 1,566 voters found that three-quarters of respondents were unsure or unwilling to trust any company to operate a data center responsibly, with half citing environmental factors as their primary concern.

The data center industry argues that their benefits, such as investment totals, construction jobs, and competition with China, are substantial. However, voters are now demanding more concrete answers regarding who bears the financial responsibility, what remains after construction, and who is accountable if the promised conditions are not met.

Recent findings from Gallup indicate that a significant majority of Americans, 71%, express opposition to AI data centers in their neighborhoods. In a survey conducted by Veleonis and Co/efficient, 75% of respondents stated that they would choose not to trust any company to operate a data center responsibly, with half of those respondents citing environmental impacts as their primary concern.

The problem lies in the fact that the industry has built its case around scale before earning the public’s permission to build. As of now, there are approximately 4,000 data centers operating nationwide, with roughly 3,000 more planned or under construction. The Lawrence Berkeley National Laboratory, a research lab affiliated with the Department of Energy, estimates that by 2030, data centers could consume between 9.5% and 15.3% of U.S. electricity, up from around 4.7% in 2024 – a dramatic increase that could ideally triple current consumption levels.

To address this growing concern, a novel concept called the "Capacity Expansion Bargain" has been proposed. This concept calls for a reciprocal agreement in which growth is added without consuming the already scarce resources that communities possess.

Under this agreement, companies would be responsible for covering the costs created by their projects, bringing new power onto the grid, publishing verifiable operating data, and strengthening host communities. In return, governments would honor agreed-upon tax and permitting terms and move compliant projects through a clear process and timetable.

Key aspects of this proposed bargain include the implementation of individual contracts for each facility, which would trace costs back to the respective data center and require developers to finance new substations and grid connections. Moreover, facilities would be required to pay a minimum payment for reserved capacity, finance new infrastructure, and face an exit fee if they withdraw from the agreement.

Each project should also publish a plain-English fact sheet outlining key details such as electricity and water usage, cooling methods, power sources, public incentives, permanent job creation, and contributions to local infrastructure and emergency services. Independent experts would then verify the accuracy of this information post-facility construction.

In addition, any agreements involving public funds or resources should remain transparent. Violations of these terms, including false claims, should result in penalties and the repayment of incentives. It is crucial for states to uphold the tax and permitting terms promised to projects that have committed capital. Once this standard is met, a project should undergo a single, coordinated review process across all relevant agencies, with clear requirements and deadlines.

Pennsylvania has already implemented many of the protections outlined in this proposed bargain, and it is essential for the state to reinforce its commitment by ensuring a reciprocal promise from companies. This would involve projects that pay their infrastructure costs, obtain local approval, and accept enforceable disclosure receiving expedited reviews.

For a successful implementation of this bargain, stable rules and timely decisions must be upheld, ensuring that both parties can benefit from the capacity expansion without sacrificing the well-being of communities.