Local residents block billion-dollar data center projects across America

Big technology firms are running into a wall of local resistance as they try to build massive data centers across the country, with residents in small towns and suburbs pushing back against developments they say threaten their communities.

The wave of opposition is spreading fast. Towns and cities nationwide are sharing strategies and information about stopping data center construction plans that keep getting larger to handle growing demand for artificial intelligence and cloud computing. Companies searching for reliable electricity connections are branching into new areas, but they’re meeting fierce resistance.

Local government officials face tough decisions about whether these facilities, which use enormous amounts of electricity and water, belong in their communities. Many places lack clear rules about data centers, forcing boards to consider special exceptions or draft new laws from scratch.

What used to be quiet town meetings are now packed with upset residents demanding their leaders say no. “Would you want this built in your backyard?” Larry Shank asked officials in East Vincent Township, Pennsylvania, last month. “Because that’s where it’s literally going, is in my backyard.”

The mounting defeats worry major technology companies, property developers, power companies, and labor unions invested in the data center business.

Andy Cvengros, who works on data center deals for commercial real estate company JLL, told AP News he’s seen opponents knock on doors, pass out T-shirts, and plant signs in yards for seven or eight recent projects. “It’s becoming a huge problem,” Cvengros said.

Data Center Watch, run by AI security firm 10a Labs, reports a major increase in community and government obstacles to data center construction. From April through June, the group tracked 20 proposals worth $98 billion across 11 states that got stopped or stalled because of local fights and state-level opposition. That represented two-thirds of all projects being monitored.

Groups working on environmental and consumer issues say they’re getting daily phone calls and helping communities learn how to fight back.

“I’ve been doing this work for 16 years, worked on hundreds of campaigns I’d guess, and this by far is the biggest kind of local pushback I’ve ever seen here in Indiana,” said Bryce Gustafson from the Citizens Action Coalition in Indianapolis. Just in Indiana, Gustafson counted over a dozen projects that failed to get approved for rezoning.

Common concerns unite different communities

Residents share similar worries no matter where they live. Many already upset about rising electricity costs don’t want data centers that could push bills even higher. People fear losing farmland, forests, and open spaces. Others worry about noise from backup diesel generators and cooling systems, damage to property values, and health effects. Some are concerned their wells and underground water supplies could dry up, as data centers consume millions of liters of water daily.

Legal battles are erupting in both directions over whether local governments followed proper procedures.

Major technology companies Microsoft, Google, Amazon, and Facebook, spending hundreds of billions worldwide on data centers, didn’t respond to Associated Press questions about how community opposition affects their plans.

Microsoft did mention the difficulties in an October filing with securities regulators, listing “community opposition, local moratoriums, and hyper-local dissent that may impede or delay infrastructure development” among its operational risks.

The resistance is making an impact even when state and federal officials support the projects.

Maxx Kossof, an investment executive at Chicago developer The Missner Group, said developers worried about zoning battles are thinking about selling properties after securing electricity access—a valuable asset that makes projects more attractive. “You might as well take chips off the table,” Kossof said. “The thing is you could have power to a site and it’s futile because you might not get the zoning. You might not get the community support.”

Industry representatives complain that opponents spread false information about data centers polluting water and air. Still, they’re telling developers to talk with communities earlier, highlight economic benefits, support local programs, and explain conservation efforts.

“It’s definitely a discussion that the industry is having internally about, ‘Hey, how do we do a better job of community engagement?'” said Dan Diorio from the Data Center Coalition trade group.

Local officials feel the pressure

In Matthews, North Carolina, developers withdrew a project from the October agenda after Mayor John Higdon told them it faced certain defeat. Despite promises to fund half the city budget with environmentally friendly features, town meetings overflowed and feedback ran “999 to one against,” Higdon said. Council members who voted yes “would no longer be in office,” he added. “That’s for sure.”

Near Duluth, Minnesota, in Hermantown, a proposed campus several times bigger than the Mall of America is stuck in legal challenges over environmental reviews.

Residents connected through social media and learned to organize protests and spread their message. They felt deceived when they learned state, county, city, and utility officials knew about the plan for a full year before releasing internal emails confirming it.

Join Bybit now and claim a $50 bonus in minutes