AI’s Next Big Problem Is Not Chips Or Power. It’s Growing Opposition To Data Centers.

The rapid expansion of artificial intelligence in the U.S. is running into a growing problem: communities and politicians are becoming increasingly wary of the data centers needed to support it.

Technology companies have committed billions of dollars to new facilities as demand for computing capacity rises. But proposed projects are facing opposition over electricity costs, water consumption, large developments and concerns about how many permanent jobs they create.

The issue is also becoming more prominent in election campaigns, with politicians from both parties calling for tighter restrictions on data center development in some states.

Axios noted on Wednesday that AI executives and Republican officials are increasingly concerned that public opposition could slow construction and make elected officials less willing to approve new projects.

The political shift comes as the amount of money committed to AI infrastructure continues to rise.

Goldman Sachs Research estimates the biggest AI providers will spend about $755 billion on capital expenditures in 2026, rising to $920 billion next year. Data centers and energy infrastructure account for a significant part of those expansion plans.

Goldman has separately estimated that hyperscalers could spend about $5.3 trillion on AI and data centers through 2030, requiring financing from public and private markets.

The growth is putting additional demands on the U.S. electricity system. U.S. data center power demand is expected to more than double from 31 gigawatts in 2025 to 66 gigawatts in 2027, according to Goldman Sachs. Data centers could account for 8.5% of peak U.S. summer electricity demand by then, up from 4.1% in 2025.

Those requirements have contributed to local debates over who should pay for new power infrastructure and whether large data center projects could increase electricity costs for households.

Public attitudes toward AI more broadly are also becoming more cautious.

According to Pew Research Center, polling cited by Axios, 52% of Americans now say they are more concerned than excited about the increased use of AI in daily life, up from 37% in 2021.

The change is also visible among younger Americans. Fifty-five percent of adults under 30 said they were more concerned than excited about AI, with potential job losses among the reasons cited.

Data centers themselves face greater opposition. A June Echelon Insights survey cited by Axios found only 27% of voters would support an AI data center being built in their community, the lowest level of support among the types of projects included in the poll.

That public sentiment is beginning to affect state politics. Pennsylvania Gov. Josh Shapiro on Tuesday signed an executive order imposing new requirements on data center developments after previously supporting major investment in the sector.

Under the order, Pennsylvania's Department of Environmental Protection can review permit applications only after developers obtain local approval and make legally binding commitments to comply with the state's Responsible Infrastructure Development requirements. The rules cover issues including energy affordability, environmental protections, workforce development, transparency and community involvement.

Shapiro said more than 100 data center facilities have reportedly been proposed in Pennsylvania and argued that projects should not leave communities responsible for additional energy and infrastructure costs.

The issue is also appearing in Wisconsin's governor's race.

Republican nominee Tom Tiffany, an ally of President Donald Trump, has attacked Democratic opponent David Crowley over comments supporting Wisconsin becoming a major center for AI infrastructure, according to Axios.

That position differs from the Trump administration's broader push to expand U.S. AI infrastructure and maintain the country's position in the global technology industry.

Technology companies are responding by putting more emphasis on the local economic benefits of their projects.

OpenAI chief global affairs officer Chris Lehane told Axios that companies need to address concerns about issues such as electricity and water directly and show communities what they will receive in return for hosting data centers.

Meta has also announced a $1 billion Future Is for Everyone Fund focused on communities where it operates or plans to build data centers. The company has said the money will support groups including teachers, police and fire departments.

The political debate could have consequences beyond individual data center projects.

Large technology companies are increasing spending on chips, servers, electricity generation and data center construction based on expectations that demand for AI services will continue growing.

Goldman Sachs has noted that the largest cloud infrastructure companies are spending heavily on AI, while investors have also pushed up the valuations of businesses connected to the buildout. At the same time, the bank has warned that an eventual slowdown in capital expenditure growth could pose a risk to some AI infrastructure companies' valuations.

Building enough computing capacity therefore remains an important part of those companies' expansion plans.

Opposition to data centers does not mean that development will stop. Thousands of facilities are already operating or planned across the U.S., and companies continue to announce major projects.

But the debate is increasingly moving beyond questions about chips, electricity supplies and financing. Companies are also having to convince local communities and elected officials that the projects are worth their costs.