On Tuesday night, I was home in San Francisco alongside friends of mine with whom I reported from the 2024 National Conventions. We all moved to the Bay from different swing states, and have made a tradition of pooling our anxiety and our hope for them every election day.
I was keeping my eye out for a few things; for one, how Anthropic-funded candidates would perform — mixed results, but some of their favored candidates, including our new San Francisco representative Scott Wiener, won.
I was also hoping to see widespread rejection of big tech’s unchecked entitlement. Usually, our home states — Arizona, Georgia, and Wisconsin — have very different prominent issues. They now share, alongside many other states, an anti-data-center movement.
Decentralized fights in local communities are happening everywhere. Communities that rally against a data center are consistently made to feel powerless in preventing it. I’ve been filled with hope watching those communities refusing to allow their home to be reduced to land for big tech to put things they don’t want to see.
Georgia is one of the fastest-growing hubs for data centers in the world, recently overtaking Northern Virginia’s ‘data center alley’. There are over three hundred data center facilities in the state, more than half of them in the metro Atlanta region. In August, the nonprofit Science for Georgia reported three in four residents are concerned about data center development, and across party lines, 83% of Georgians are in favor of a statewide moratorium. Their elected representatives at the local and state level have been ignoring the consensus of their constituents.
That’s in line with what I’ve seen firsthand in Wisconsin, where a deeply divided electorate rarely finds an issue as uniting as data centers have been. Residents told me this summer that the ‘Dairyland, Not Dataland’ movement has overcome partisanship and invigorated local democratic participation.
Many states, regardless of traditional affiliation, are going through the same thing.
Data centers were a campaign touchstone across Georgia during the Midterms. Outgoing Governor Brian Kemp has been a data center hawk, and the Republican candidate to replace him, Rick Jackson, wasn’t just another data center fanatic — he was the president and CEO of Datahub Developers, a company actively inserting data centers into Texas communities against their wishes. Within days of the Georgia governor’s race being called for Keisha Lance Bottoms — the first Democrat to win that office in nearly three decades — she promised to sign a statewide data center moratorium.
In Arizona, home to over 180 operating or developing data centers, voters were also widely opposed to them going into the election. Some of their high profile races still haven’t been called yet, but one notable flip: Arizona’s 1st, representing Scottsdale, turned blue with former state Rep. Amish Shah, who ran opposing new data centers; his Republican opponent supported them.
It’s especially hard to stomach any fresh water allocated to data centers or the power plants that run them in a state facing a serious water shortage crisis. Forbes reported in September that data centers in Arizona are contributing to shortages that have mandated water usage cuts for residents.
Everywhere data centers have upended life, they upended the election. NBC News said only 13% of exit poll respondents said data centers were not a factor in their vote. Elections like Georgia’s aside, where data center anger made the regulatory candidate appealing, ballot measures were passed in ten states. They ranged from capping energy use, new zoning restrictions, requiring voter approval for new data centers, and moratoriums of varying lengths. Cities that otherwise voted very differently from each other, in Florida, Maine, California, Ohio, and Kansas, all passed outright bans on data centers.
A dense map of dots representing functioning or developing data centers illustrates how a local issue became a successful national movement. This election was a referendum on Trumpism and its symptoms; it was also a rejection of big tech’s message of forced inevitability.
Consequently, frontier AI companies are now backtracking on that message and scrambling to mitigate their electoral PR crisis. OpenAI said it will lessen their use of NDAs in data center development. They seem to think the problem isn’t the predatory and extractive nature of shoehorning data centers anywhere they like, but poor PR messaging while doing so. President Greg Brockman said yesterday that OpenAI must do a better job of “really communicating to people, to local communities, about why data centers can be beneficial to them.”
Communities that have come together around this don’t want or need more PR from the parent company of the massive building actively raising their bills, polluting their area, and generating 24/7 noise. They are well aware of the conditions of their own existence. Any attempt to convince them otherwise is insincere, condescending, and will not work. There’s a reason San Francisco, where OpenAI is headquartered and its executives live, has a moratorium on data centers. They aren’t focusing PR efforts on building them in their own home. They want them in yours, and for you to look away from its tangible impacts long enough to hear them out on why your sacrifice is worth it, to them.
Our Tuesday night ended with a reminder that political victories are relative. Just a few minutes after celebrating Michigan’s senate race being called, data centers returned to the conversation. My friend from Arizona told us they’d just learned one would be built very close to his family.
This week was a victory in slowing the momentum of the data center boom. Turning its trajectory around is a work in progress.
Texas gives a market read on how much momentum a moratorium can slow, since its governor-elect also campaigned on one. When we read what eight listed companies tell investors about their Texas capacity, about 18.3 GW in all, only about 20% was approved or outside the grid operator's Batch Zero study by their own account, and about 63% was conditional or still in process. The day after the election Hut 8 fell 23.2%, Cipher 20.0%, Galaxy 17.0% and CleanSpark 16.6%, while Riot, which says its existing capacity was already energized, rose 9.6% (it also announced a 910 MW lease that day). Company-by-company table: https://equibles.com/research/texas-data-center-moratorium-which-stocks-are-exposed-and-how-much
Data: SEC filings and earnings calls, processed by Equibles.