Governors Crack Down on Data Centers

A wave of political backlash against data centers is sweeping across the United States as midterm elections approach. Governors in key states, including United States — Pennsylvania's Josh Shapiro, United States — Texas's Greg Abbott, United States — Arizona's Katie Hobbs, United States — New York's Kathy Hochul, and United States — Illinois's JB Pritzker, have taken steps to impose stricter regulations, halt tax exemptions, or impose moratoriums on data center projects. This shift comes amid growing community opposition to the energy-hungry facilities that power AI and cloud computing. In United States — Pennsylvania, Shapiro announced the 'strictest guardrails in the nation,' requiring developers to pay full electricity costs, limit water use, and secure local approval. In United States — Texas, Abbott ordered regulators to hold up projects and promised legislative action to remove tax breaks. Meanwhile, lenders and banks, including Bank of America, JPMorgan, and Morgan Stanley, are increasingly factoring community opposition into their financing decisions, scrutinizing projects more carefully. Several high-profile projects, such as BlackRock and Meta's United States — El Paso, Texas facility and CyrusOne's United States — Illinois center, face opposition. The backlash is also influencing gubernatorial races, with challengers like Gina Hinojosa in United States — Texas and Stacy Garrity in United States — Pennsylvania capitalizing on the issue.