States Clash Over Local Control of Expanding Data Center Industry

Nearly 4,600 data centers operate across the United States, with billions of dollars invested annually, and state officials are increasingly pushing back. New York Democrat Governor Kathy Hochul introduced a moratorium on hyperscale facilities, and Texas Republican Governor Greg Abbott announced a pause on new data-center grid connections until state agencies can audit the projects. Fourteen other states, from Maryland to Virginia, are debating similar actions.

Opponents claim the restrictions protect residents from higher power costs and noise, though studies from Lawrence Livermore National Laboratory found no direct link between data centers and rising electricity prices. Utilities in 19 states have imposed large-load tariffs, and the White House reported that major cloud providers—including Amazon, Google, Meta, Microsoft, OpenAI, Oracle and xAI—have agreed to cover 100% of the power infrastructure needed for their sites. Localities such as Lancaster, Pennsylvania and Cedar Rapids, Iowa have negotiated deals that include noise limits, water-use caps and guaranteed jobs, illustrating how communities can balance benefits and disruptions without blanket bans.