Economies change, so it’s not surprising that the boom in Artificial Intelligence is fueling the construction of infrastructure to accommodate this growth. In particular, tech companies are building massive data centers. These are large, modern warehouse-style buildings that house computers, routers and storage. It’s more efficient to place them in concentrated locations.
Nearly 3,000 new centers are currently under development across the country, with Virginia, Texas, Georgia and California leading the way. It’s crucial to build the infrastructure that allows this to take place — and that ensures that the United States can compete with China. But data centers are running up against local and even national opposition.
Much of the opposition comes from residents worried about noise, light and other externalities. There are legitimate complaints, of course, but most of the opposition falls into the NIMBY (Not In My Back Yard) category, even for centers in remote locations.
For perspective, Reason’s Christian Britschgi notes “data centers are about as low-impact land use as one could hope for” given limited emissions, noise and traffic. “And while their electricity usage is gargantuan, there’s little evidence that this additional demand is increasing consumers’ electricity costs.” They are far less impactful than, say, building a new oil refinery.
Another concern is their effect on water resources. A CalMatters article recently explained that new centers are stressing scarce water resources. But as a 2024 report to the Virginia General Assembly’s Joint Legislative Audit and Review Commission found: “Most data centers use about the same amount of water or less than an average large office building, although a few require substantially more, and some require less than a typical household.”
Residents in Utah have turned out in droves to oppose a project developed by TV celebrity Kevin O’Leary. As the Salt Lake Tribune noted in a recent article, “At full buildout, the data center campus will use more than twice as much power as the entire state of Utah.”
This reflects another major concern about these centers: their impact on existing electricity infrastructure and allegations they drive up rates. But with respect to the Utah project, Britschgi notes, citing the work of Sean Reagan at City Journal, “the project sponsors plan on building a natural gas plant on-site to satisfy their own power needs. To service the data center’s water demand, they are purchasing existing water rights from private owners.”
Nationally, according to the Congressional Research Service, the impact of data centers on electricity rates is more complicated than one might think. Citing research from the Lawrence Berkeley National Laboratory, the CRS noted, “states with the largest data center demand growth generally saw electricity price decreases between 2019 and 2025, though some states with relatively large data center growth saw price increases or little change.”
We of course oppose public subsidies for these private projects, but policy makers can derail concerns about energy use by upgrading public infrastructure to meet demand. Private initiative on the part of data centers to ensure their self-sufficiency can also be encouraged, as is the case with the Utah project.
If Americans want the jobs, tax revenues and other benefits associated with the AI boom, then our elected officials need to do their job and figure out how to allow legitimate projects to be built while also addressing legitimate negative externalities.
Blanket bans and NIMBY reflexes might feel right to some. But the goal should not be to slam the brakes on new technologies and their required infrastructure. Instead, the goal should be ensuring the rights of all are protected as projects are proposed and vetted.