Local Bans Threaten U.S. AI Data Center Expansion in Midwest and South · Digg

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Local Bans Threaten U.S. AI Data Center Expansion in Midwest and South

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Rohan Paul@rohanpaul_ai#1257inTech

The U.S. AI buildout is running into a harder constraint than GPUs: permission.

The Information’s new map finds 300+ state and local data-center bans or moratoriums since 2023, with 275+ passed this year and 75+ still under consideration; resistance is strongest in the Midwest and South, exactly where hyperscalers want cheap land and megawatt-scale power.

But the backlash against data centers is outrunning the facts.

The most current datacenter is increasingly designed to solve the two biggest fears: water and power bills.

Start with water. Microsoft’s next-generation AI data centers use chip-level, closed-loop cooling that consumes zero water for cooling and can avoid more than 125 million liters per year per site.

Its fleetwide water-use efficiency has already improved 39% since 2021, to 0.30 liters per kWh.

Google reports that 86% of its freshwater withdrawals come from low- or medium-risk sources, and its global data-center fleet runs at a 1.09 PUE versus a 1.56 industry average—meaning far less wasted overhead energy.

Electric bills are not automatically shifted to households, either. A recent causal study of U.S. retail rates from 2015–2024 found data centers modestly lowered average rates by spreading fixed grid costs across more electricity sales.

And “bring your own power” is already the new trend - e.g. Google’s 500 MW nuclear deal, Microsoft’s 835 MW Three Mile Island agreement, and Meta’s 1,121 MW nuclear contract.

10:47 AM · Jun 27, 2026 · 5.3K Views

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The 300-Plus Bans and Moratoriums Threatening the U.S. Data Center Boom

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Rohan Paul@rohanpaul_ai

Data centers did not raise average U.S. household electricity prices from 2015 to 2024, and may have slightly lowered them when the grid had room to grow.

The reason being that electricity grids have big fixed costs, so more steady demand can spread those costs across more power sales.

When a durable new load uses the system more heavily, those fixed costs can be spread across more kilowatt-hours, especially if new generation is cheaper than the aging mix already built into rates.

The authors test this by comparing U.S. states from 2015 to 2024 and using old highway routes as a tool to separate data center location from normal price trends.

Their main estimate says a 10% rise in data center capacity was linked to about a 0.4% fall in average residential electricity prices.

The reason is not that electricity becomes free to produce, but that grids, wires, and generators can sometimes serve more demand at a lower average cost.

The paper also warns that this only holds when the grid can keep building enough supply, because shortages or overbuilding could flip the effect and raise prices.

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Link – arxiv. org/abs/2606.19777

Title: "Have Data Centers Raised Your Electric Bill? Causal Evidence from the United States"

Rohan Paul@rohanpaul_ai

The U.S. AI buildout is running into a harder constraint than GPUs: permission.

The Information’s new map finds 300+ state and local data-center bans or moratoriums since 2023, with 275+ passed this year and 75+ still under consideration; resistance is strongest in the Midwest and South, exactly where hyperscalers want cheap land and megawatt-scale power.

But the backlash against data centers is outrunning the facts.

The most current datacenter is increasingly designed to solve the two biggest fears: water and power bills.

Start with water. Microsoft’s next-generation AI data centers use chip-level, closed-loop cooling that consumes zero water for cooling and can avoid more than 125 million liters per year per site.

Its fleetwide water-use efficiency has already improved 39% since 2021, to 0.30 liters per kWh.

Google reports that 86% of its freshwater withdrawals come from low- or medium-risk sources, and its global data-center fleet runs at a 1.09 PUE versus a 1.56 industry average—meaning far less wasted overhead energy.

Electric bills are not automatically shifted to households, either. A recent causal study of U.S. retail rates from 2015–2024 found data centers modestly lowered average rates by spreading fixed grid costs across more electricity sales.

And “bring your own power” is already the new trend - e.g. Google’s 500 MW nuclear deal, Microsoft’s 835 MW Three Mile Island agreement, and Meta’s 1,121 MW nuclear contract.

4h1.8K22

Rohan Paul@rohanpaul_ai

https://www.theinformation.com/articles/300-plus-bans-moratoriums-threatening-u-s-data-center-boom

https://arxiv.org/abs/2606.19777

Rohan Paul@rohanpaul_ai

The U.S. AI buildout is running into a harder constraint than GPUs: permission.

The Information’s new map finds 300+ state and local data-center bans or moratoriums since 2023, with 275+ passed this year and 75+ still under consideration; resistance is strongest in the Midwest and South, exactly where hyperscalers want cheap land and megawatt-scale power.

But the backlash against data centers is outrunning the facts.

The most current datacenter is increasingly designed to solve the two biggest fears: water and power bills.

Start with water. Microsoft’s next-generation AI data centers use chip-level, closed-loop cooling that consumes zero water for cooling and can avoid more than 125 million liters per year per site.

Its fleetwide water-use efficiency has already improved 39% since 2021, to 0.30 liters per kWh.

Google reports that 86% of its freshwater withdrawals come from low- or medium-risk sources, and its global data-center fleet runs at a 1.09 PUE versus a 1.56 industry average—meaning far less wasted overhead energy.

Electric bills are not automatically shifted to households, either. A recent causal study of U.S. retail rates from 2015–2024 found data centers modestly lowered average rates by spreading fixed grid costs across more electricity sales.

And “bring your own power” is already the new trend - e.g. Google’s 500 MW nuclear deal, Microsoft’s 835 MW Three Mile Island agreement, and Meta’s 1,121 MW nuclear contract.

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