Bipartisan Pushback Hits AI Data Centers Over Power and Water

Residents in multiple states now face higher electricity rates and strained water supplies as AI data centers multiply, forcing elected officials to weigh promised investment against immediate local costs. The central tension pits rapid federal support for AI infrastructure against state and local demands for audits, restrictions, and protection of existing ratepayers.

In Texas, Governor Greg Abbott ordered a statewide pause on new data center grid connections after the Electric Reliability Council of Texas recorded more than a 500 percent rise in projected peak demand. The order requires companies to disclose power and water consumption, tax incentives, cooling methods, ownership, and community impact plans before any connection is approved. Abbott’s spokesperson stated that fewer than 10 percent of proposed facilities had responded to earlier information requests. President Trump described the pause as a mistake during a Punchbowl News interview, arguing that willing communities stand to gain substantial revenue and that data centers could exceed oil in economic scale.

Similar resistance has appeared elsewhere. Utah Senate President J. Stuart Adams lost his Republican primary after backing a project linked to investor Kevin O’Leary. In Pennsylvania, Republican legislators introduced bills to repeal data center tax breaks and impose a moratorium on new applications. Florida Governor Ron DeSantis signed legislation giving local governments veto power over proposals. Nebraska Governor Jim Pillen ended tax incentives and paused new construction. Ohio Republican gubernatorial nominee Vivek Ramaswamy pledged an immediate halt to approvals pending legislation that would shield residents from electricity and property tax increases.

Gallup polling released earlier this year found seven in ten Americans oppose new AI data centers in their area, with strong opposition at 48 percent. Democratic and Republican voters both register majority opposition, though Democrats form the larger share. Protests have occurred in Texas cities including Abilene, Texarkana, Lubbock, and San Marcos, the first Texas city to enact a ban. The Trump administration has maintained support through accelerated federal permitting and the Stargate Project, while expanding a ratepayer protection pledge aimed at shielding households from rising bills.