TIME
· collected 2026-08-28 · by Jeffrey Sonnenfeld, David Siegel and Stephen Henriques
Data center companies “dug their own grave,” Texas Governor Greg Abbott said Sunday, and “that’s why they got the backlash they deserve.”
asserted
they → dig → backlash
Nine months ago, Abbott crowned Texas the epicenter of AI development, alongside Google executives announcing a $40 billion investment in the state.
asserted
Texas → crown → state
Pennsylvania’s Josh Shapiro, a Democrat who actively recruited Amazon’s $20 billion commitment to his commonwealth, made a similar U-turn days earlier, signing an executive order he calls the “nation’s strictest guardrails” on data centers: no more fast-track permits, no nondisclosure agreements, and no state permit review until developers make binding commitments to community standards.
asserted
developers → recruit → standards
When a Texas Republican and a Pennsylvania Democrat pivot to the same position in the same week, it becomes clear that the politics of data centers have shifted.
asserted
politics → pivot → centers
Like everything else in AI, sentiment is moving at an extraordinary pace.
asserted
sentiment → move → pace
Even the AI industry’s biggest winner recognizes the need for change.
asserted
winner → recognize → change
The tech sector needs to “do a much better job working with the communities,” Nvidia CEO Jensen Huang said this week.
asserted
Huang → need → communities
While shifting or walking back public statements never looks good, leaders are simply listening to voters’ demands.
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leaders → shift → demands
The truth is that leaders across the political spectrum are pivoting on data centers for a simple reason: they want their communities to actually benefit.
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communities → pivot → reason
The best ones are listening to citizens’ concerns while constructively raising the bar for the data center industry—not cutting them off.
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ones → listen → them
The costs and benefits of data centers
Seven in ten Americans tell Gallup they oppose a data center in their own community, more opposition than a nuclear plant draws.
asserted
plant → tell → opposition
The primary complaint started with electric bills.
asserted
complaint → start → bills
PJM’s independent market monitor attributes 63% of the region’s 2025/2026 capacity price increase to data center load, roughly $9.3 billion recovered from customers across 13 states in a single year, causing household bills to rise 1.5% to 5% this summer.
asserted
bills → attribute → year
The countervailing benefits are just as measurable.
asserted
benefits → countervail → ?
In Loudoun County, Virginia (often referred to as known as the "Data Center Capital of the World”), data centers supply as much as 31% of local revenue by the state legislature’s audit count, and the county has banked a $119.7 million stabilization fund against any downturn.
asserted
county → refer → downturn
The facilities also pay blue-collar wage premiums of 10% to 64% over comparable employers, the venture firm Andreessen Horowitz finds in Indeed postings data.
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firm → pay → data
The Dallas Fed has reported that skilled concrete workers, who typically make $28 to $32 per hour, are earning $45 per hour and a $150 per diem on data center jobs.
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who → report → jobs
And in July, the National Federation of Independent Business found that small-business optimism is at its highest levels in a year, crediting AI investment in chips and the structures that house them with spillover business opportunities.
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that → find → opportunities
The fight over data centers, meanwhile, has become a social and political flashpoint and, at times, embellished beyond what the record supports.
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record → become → what
Some backlash is earned.
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backlash → earn → ?
Most jobs promised are temporary.
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jobs → promise → ?
Resource demands are massive, and draining when mismanaged.
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demands → drain → ?
Speculators have gamed interconnection queues and incentive programs, while both developers and policymakers have done a poor job communicating to the public.
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developers → game → public
We heard these concerns from over 50 mayors leading cities that span the U.S. during our annual Yale Mayors College in March.
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that → hear → March
Done well, though, these projects are a once-in-a-generation development opportunity for places ranging from underused farmland to urban brownfield sites.
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projects → do → sites
As Huang explained it: “This is the first time in probably the last century that we’re able to invest in sustainable energy, invest in improving our energy grid, securing our energy supply, reducing the cost of energy across the country.”
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we → explain → country
Opposition to data centers tends to concentrate at the county level because costs pool locally while benefits disperse.
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benefits → tend → level
A county absorbs the water draw, the noise, the land conversion, and a share of the regional capacity bill.
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county → absorb → bill
The compute serves users elsewhere, and the returns accrue to shareholders nowhere nearby.
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returns → serve → shareholders
Every serious policy response attempts to move some portion of that diffuse benefit back to the community bearing the concentrated cost.
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response → attempt → cost
The responses span a diverse spectrum.
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responses → span → spectrum
New York paused state environmental permitting on large data centers for at least one year, pending a statewide study—the only statewide pause in effect, for now.
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York → pause → effect
Texas ordered an audit of every project in its grid queue, and the state’s grid operator paused new data center connections until the audit is complete.
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audit → order → connections
Maine’s legislature passed the first statewide construction moratorium this spring, only for Governor Janet Mills to veto the bill and create an advisory council to write standards instead.
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Mills → pass → standards
More broadly, 27 states advanced large-load legislation this year, with California, Ohio, and Utah enacting laws that exceed the industry’s voluntary ratepayer pledge to the White House.
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that → advance → House
At the federal level, Washington continues to accelerate.
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Washington → continue → level
A July 2025 executive order fast-tracked federal permitting, and a December preemption order, whose promised list of invalid state laws has yet to appear, expressly preserved state authority over “AI compute and data center infrastructure, other than generally applicable permitting reforms.”
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list → track → reforms
Beneath the surface, the two sides are searching for a shared premise: the buildout must take the form of a mutually beneficial, transparent partnership.
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buildout → search → partnership
In Morning Consult polling commissioned for our June CEO Summit, 55% of Americans view data centers as a community benefit, while 69% call the backlash justified, the clearest indicator of an electorate searching for better terms, not fewer projects.
asserted
% → commission → terms
“Don’t ban—raise the bar, ask for more,” suggests Chris Crosby, CEO of Compass Datacenters.
uncertain
Crosby → ban → Datacenters
…and 67 more, not listed.
