Data centers' power and water bills are turning voters against AI
From Texas to Mississippi, rising electricity and water costs tied to AI data centers have sparked bipartisan backlash just as midterm elections approach.
What happened: A wave of local and state backlash against AI data centers has become a defining issue heading into the November 3 midterms. A University of Pennsylvania Annenberg survey found 70% of adults under 30 oppose new data centers nearby, more than any other age group, a reversal of the usual pattern where young people embrace new tech fastest. In Texas, 57% of voters oppose construction, including 43% of Republicans and 75% of Democrats. Campaigns have spent $45 million on ads mentioning data centers this year, mostly critical. In Southaven, Mississippi, xAI's real estate arm is reportedly offering to buy up to 418 homes near its data center and gas-fired power plant, but only if owners agree to drop claims from a lawsuit over constant noise and vibration.
Why it matters: The anger crosses party lines and age groups because the complaints are concrete: higher electricity bills, strained water supplies, noise, and land taken for development. A Bloomberg analysis found wholesale power costs up to 267% higher in a single month in some heavy data-center regions versus five years earlier; Texas bills have risen 35% in five years. Economists warn lower-income households will feel rising costs hardest. Politicians who once courted the industry, including Pennsylvania's Josh Shapiro, Texas's Greg Abbott, and even President Trump, are now publicly distancing themselves, signaling the costs to ordinary residents have become politically impossible to ignore, even though voters still rank data centers below cost of living and healthcare as top concerns.
How it works, plainly: Data centers draw huge, constant amounts of electricity and often need millions of gallons of water daily for cooling. That demand pushes utilities to build costly new plants and transmission lines, and some of that cost lands on residential bills, which typically reflect 30% to 50% of wholesale prices. States like Texas gave data centers decades of tax breaks to attract them, which is now projected to cost $3.2 billion in lost sales tax over two years. Some companies, including xAI in Mississippi, have built their own gas-fired power plants to skip grid connections and regulatory review, which also means less public oversight of pollution and noise.
The pushback and the fixes: At least several states have moved to rein in the industry: New York passed the first statewide moratorium, Pennsylvania and Texas issued executive orders tying new projects to stricter energy and water rules, and California passed bills blocking data centers from shifting energy costs onto other ratepayers. Even Trump has said large new data centers should generate their own power and pay host communities a "dividend." But enforcement looks patchy: Texas community groups say the state is still quietly processing permits despite a declared pause, and xAI's home-buyout offers in Mississippi show how a company can settle privately with individual residents instead of changing how it operates.