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Trump carves out government role for data centers

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Community response has risen, becoming more organized

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Local areas network to learn from others

By Carey L. Biron

WASHINGTON, Sept 1 (Thomson Reuters Foundation) - As

President Donald Trump aims the might of the U.S. government at

boosting data center development, communities in the crosshairs

are organizing to have control over its local impact.

Trump unveiled an AI strategy last month aimed at achieving

U.S. dominance by cutting regulation, speeding up permitting and

making land available for proposed data centers and

infrastructure.

The strategy followed his executive order naming AI as key

to national security and the announcement of a $500 billion

private investment plan dubbed "Project Stargate" to boost AI

development across the country.

Data centers provide the engine, brain and memory for AI and

cloud computing tools, used to power applications from

children's toys to office efficiency systems and military

analysis.

Local communities are responding with concerns over data

center development that crowds already populated areas,

contributing to congestion, traffic, noise and light pollution,

water availability and higher energy costs.

They are becoming increasingly organized and building an

expanding national network linking areas facing similar

development issues.

More than 140 activist groups in 24 states are working to

block data center development, with local opposition having

halted or delayed projects worth $64 billion in the past two

years, according to tracking from Data Center Watch, a research

group.

The government's new strategy puts data centers on a par

with military installations in terms of regulatory preferential

treatment, said Morgan Butler, a senior attorney with the

Southern Environmental Law Center.

Local governments can use zoning and land-use authority to

approve or disapprove data center development, but the new

government strategy will deprive them of information needed to

make their decisions, he said.

The strategy "threatens to discourage states and localities

from adopting strong ordinances to help limit the development of

data centers," he said.

Residents are left without the information they need to

fight back, he said.

"It becomes harder to convince your local government to make

the right decision if you don't have the right information on

the table."

The White House did not respond to a request for comment.

'HYPER-LOCAL FOCUS'

The United States already hosts nearly half of the world's

data centers -- about 5,400 -- due to a massive build-up in

recent years.

Data centers are being built by big consumer brands

including Amazon ( AMZN ), Google and Meta as well as lesser-known

developers such as QTS, and the U.S. Department of the Interior

Department has been seeking public lands for potential

development.

Many localities have jumped at the chance to host such

development, eyeing job creation and economic growth.

The data-center industry contributed 4.7 million jobs and

$727 billion to the gross domestic product in 2023, according to

a February report from the Data Center Coalition, an industry

group.

Other communities have not been so enthusiastic.

Their concerns range from traffic and pollution to water

usage and rising energy rates, said Ben Inskeep, program

director with Citizens Action Coalition, an Indiana utility

watchdog group.

"One of the things locals are finding frustrating is how

operate through secrecy, waiting until the last

second to notify that construction of a data center is under

development," he said.

That has led communities to search out others that have gone

through similar experiences, he said.

His coalition is tracking 40 data center proposals in the

state of Indiana, where six have been withdrawn based on local

objections, Inskeep said.

Wendy Reigel, who lives in Chesterton in northern Indiana,

last year led an effort to halt development of a large data

center on a former golf course in her 500-home neighborhood.

"You never think a commercial golf course would become heavy

industry," she said.

The developer withdrew its application but moved on to try

other nearby communities, each of which also fought back, she

said.

The key is having a "hyper-local" focus, she said.

"The big goal is to come to the meetings. Email your

perspective, get out and put out yard signs, and talk to

neighbors and the people that will be making this decision."

NEW TOOLS

Legal and legislative changes are also underway to provide

new tools to address local concerns.

In June, the state of Oregon made data centers a separate

power user category, based on concerns that the cost of the

massive new electricity demands by such operations would be

borne by residents.

Previously, such costs were "spread like peanut butter"

among all users, a strategy that made sense when power needs

rose roughly at pace with one another, said Bob Jenks, executive

director of the Oregon Citizens' Utility Board.

While demand from residential customers in Oregon has risen

by 3.5% since 2016, demand from industrial customers, including

data centers, rose by 95% in just the past five years.

Electricity rates in the state have risen by about 50% in

the past five years, and last year a record number of

residential customers were disconnected for nonpayment, Jenks

said.

The Oregon law is sparking similar bills in Pennsylvania and

other states.

In Virginia, home to the largest concentration of data

centers in the world, residents are keeping an eye on further

development, said Vida Carroll, who lives in rural Prince

William County.

"There are communities all over the country going through

similar case studies of what Virginia is going through," she

said.

Actions by residents in northern Virginia have swayed

elections, prompting some proposed data center operations to

shrink in scale, she said.

In August they scored a legal victory over a proposed

2,100-acre data center complex, where construction of its

transmission line and the prospect of higher electricity rates

have concerned residents for years, she said.

"Have we been able to solve this problem? No," Carroll said.

"But I'm optimistic about the change citizens have been able to

have."

(Reporting by Carey L. Biron. Editing by Anastasia Moloney and

Ellen Wulfhorst; The Thomson Reuters Foundation is the

charitable arm of Thomson Reuters. Visit https://www.context.news/)