Midterm Results, Local Votes Set Back U.S. Data Center Expansion
Voter backlash in Tuesday's midterm elections has triggered a wave of local limits on new data centers and prompted incoming governors in Texas and Georgia to signal freezes on construction, raising doubts about hundreds of AI-focused projects across the United States.[1]
As of Wednesday afternoon, political research firm Redbud Consulting had tallied 37 voter-approved ballot measures restricting data centers nationwide and only one local vote approving a new facility, underscoring how quickly public sentiment has turned against the massive power-hungry buildings that underpin artificial intelligence.[1] Tech analyst Dan Ives estimated that between 800 and 1,000 US data centers are planned to support AI and warned the election will "clearly" slow that buildout, singling out Texas as a key state at risk.[1] In Georgia, governor-elect Keisha Lance Bottoms said on "CBS Mornings" that she will immediately sign an executive order pausing new data center construction and review existing tax incentives, while in Texas, governor-elect Gina Hinojosa's win is seen by Wall Street analysts as likely to prolong a moratorium that has already put tens of gigawatts of planned capacity in limbo.[1]
In Texas, restrictions began well before Election Day under Republican Gov. Greg Abbott, who last year pitched the state as the future "epicenter of AI development." In August, Abbott ordered a moratorium on new data-center grid approvals, and on Sept. 21 he directed the Texas Commission on Environmental Quality to halt all environmental permits until grid operator ERCOT finishes an audit of data centers in its interconnection queue, required developers to pay for all needed electrical infrastructure and disclose power and water use, and vowed to work with lawmakers to end financial incentives for the sector.[2] CNBC reported that BloombergNEF analysts estimated Abbott's pause put nearly 50 gigawatts of projects at risk, almost 20% of the 253-GW US data-center pipeline, and cited polling showing 64% of Americans would be less likely to support a candidate favoring local data centers.[3] The CBS coverage notes that Abbott's moratorium means Hinojosa can keep the freeze in place without passing new legislation, and analyst Gordon Johnson of GLJ Research estimated her victory could stall about 13 GW of planned data-center power capacity in the state.[1]
Local fights over individual projects were especially stark on Tuesday. Business Insider reported that in Ashville, Ohio, about 82% of roughly 1,800 voters rejected a resolution to move ahead with two EdgeConneX data centers and an associated natural gas plant, while in Virginia's Loudoun County, home to roughly 250 operational data centers and more than 100 more planned, Sen. Mark Warner won 69% of the vote with most ballots counted, a swing of 21 points from 2024 that underscored how data-center-heavy suburbs broke toward Democrats promising more oversight.[4] An NBC News exit poll found 76% of midterm voters opposed building data centers in their communities and 57% believed AI will do more to hurt society than help, suggesting concerns about both electricity costs and broader AI risks fed into the backlash.[5]
Energy and finance analysts say the election results will reshape the economics of AI infrastructure. Franklin Templeton strategist Stephen Dover told CBS News the midterms are likely to slow US data-center construction and raise regulatory costs, and suggested the AI and data-center trade may have become "overheated," arguing a politically driven pause could curb excessive, low-return investment.[1] Principal Asset Management's Seema Shah predicted developers will increasingly be forced to invest in local electric grids and may lose tax breaks, further pushing up costs.[1] Goldman Sachs economists, cited by Business Insider, expect Democratic state and local wins to drive short-term moratoria affecting about 45% of planned US capacity expansion.[4]
Underlying the revolt is a debate over what data centers are doing to power bills. PJM Interconnection's independent market monitor, Monitoring Analytics, estimated that existing and forecast data-center load accounted for 9% of PJM wholesale power prices through its capacity market between January and July 2026, adding $10.48 per megawatt-hour and a combined $29.4 billion to capacity revenues across the last four auctions, during a period when total wholesale costs jumped 46% to $116.53 per MWh.[6] Yet a Rutgers New Jersey State Policy Lab study of 22,834 ZIP codes in 24 states from 2014 to 2024 found that living near a data center raised a typical household's electric bill by only about $2.09 a month and that the effect disappeared at the broader utility level, though it noted regional shocks such as New Jersey's 17-20% residential bill increase in June 2025 after PJM capacity prices spiked, much of which monitors blamed on data-center demand.[7] That gap between modest average impacts and highly visible regional spikes has helped fuel voter anger and left industry leaders complaining of a "marketing problem," with Crusoe Energy CEO Chase Lochmiller recently stressing that his company's Abilene AI facilities use about as much water as 10 homes.
The post-election argument over AI infrastructure has also scrambled partisan lines. Right-leaning commentators such as @cremieuxrecueil characterized Tuesday's outcome by saying "every single possible data center ban passed," while conservative writer @gmiller warned Republicans that without rethinking their support for AI, they would "lose even worse next time," given voters' distrust of both tech executives and politicians who call AI risks overblown. Progressive leaders like Sen. Bernie Sanders had already been urging voters to oppose AI data centers outright, arguing in a pre-election post that instead of building facilities "which 66% of Americans oppose," the country should invest in millions of affordable homes, schools and hospitals. Against that backdrop, what began as a targeted pause by a Republican governor in Texas has, after Tuesday's votes, widened into a bipartisan reckoning over how much power, water and public subsidy the AI revolution should be allowed to consume.
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📊 Relevant Data
On Sept. 21, 2026, before the election, Texas Gov. Greg Abbott (R) directed the Texas Commission on Environmental Quality to halt all permits sought by data centers until ERCOT completes an audit of data centers in its interconnection queue, said no state agency should move forward with data-center approvals until the audit information is acquired, required data centers to cover all electrical infrastructure costs and report electricity and water use, and said he would work with the Legislature to eliminate financial incentives for data centers.
Governor Abbott Directs TCEQ To Halt Data Center Permits — Office of the Texas Governor
CNBC reported that Abbott had already imposed a moratorium on new data-center grid approvals in August 2026, which the Sept. 21 directive extended to environmental permits; BloombergNEF analysts estimated the Texas pause put almost 20% of the 253-GW U.S. data-center pipeline (nearly 50 GW) at risk, and an NBC News poll found 64% of Americans would be less likely to vote for a candidate who supports building local data centers.
Texas Gov. Abbott orders data center permit halt weeks after issuing moratorium — CNBC
In the NBC News Exit Poll of 2026 midterm voters, 76% said they opposed building data centers in their communities and 57% said AI will do more to hurt society than help; voters split almost evenly over which party could better handle AI.
Many voters saw midterm election as a rebuke of Trump, NBC News Exit Poll shows — NBC News
Business Insider reported that Goldman Sachs economists expect Democratic state and local wins to lead to short-term data-center moratoria potentially affecting about 45% of planned U.S. data-center capacity expansion; in Ashville, Ohio, 82% of about 1,800 voters rejected a resolution to proceed with two EdgeConneX data centers and an associated natural gas facility; and in Virginia's Loudoun County, which has about 250 operational data centers and more than 100 planned, Sen. Mark Warner won 69% of the vote with 97% counted, a 21-point swing from 2024.
Data centers got a slap in the face at the ballot box. These key votes show how. — Business Insider
PJM's independent market monitor, Monitoring Analytics, estimated that existing and forecast data-center load made up 9% ($10.48/MWh) of PJM's wholesale power price in January-July 2026 through the capacity market alone, and added a combined $29.4 billion to capacity market revenues over PJM's last four capacity auctions; total PJM wholesale power costs rose 46% to $116.53/MWh in the first seven months of 2026.
Data center load made up 9% of PJM wholesale costs so far in 2026: market monitor — Utility Dive
A Rutgers New Jersey State Policy Lab study of 22,834 ZIP codes in 24 states (2014-2024) found having a data center nearby raised a typical household electric bill by only about $2.09 a month, an effect that disappeared at the utility-territory level, but found regional exposure: PJM's 2025-26 capacity price spike, 63% of which the market monitor attributed to data-center demand, raised New Jersey residential bills 17-20% in June 2025; the authors estimate a 4-to-5-year lag before new data centers affect local bills.
Are Data Centers Raising New Jersey's Electric Bills? — Rutgers New Jersey State Policy Lab
📌 Key Facts
- As of Wednesday afternoon, November 4, 2026, political research firm Redbud Consulting had counted 37 voter-approved ballot measures restricting data centers nationwide and only one local vote approving a new facility, according to CBS News.
- Franklin Templeton strategist Stephen Dover said the midterm election results are likely to slow U.S. data-center construction and increase regulatory costs for developers.
- Tech analyst Dan Ives estimated that between 800 and 1,000 U.S. data centers are planned to support artificial intelligence and warned the election outcome will 'clearly' slow that buildout, with Texas singled out as a key state at risk.
- GLJ Research CEO Gordon Johnson estimated that governor-elect Gina Hinojosa’s victory in Texas could stall about 13 gigawatts of planned data-center power capacity in the state.
- The CBS News report notes that former Gov. Greg Abbott had already imposed a moratorium on Texas data-center approvals, enabling governor-elect Gina Hinojosa to maintain the freeze without passing new legislation.
- Governor-elect Keisha Lance Bottoms told 'CBS Mornings' on Wednesday, November 4, 2026, that she will immediately sign an executive order pausing new data center construction in Georgia and will review existing tax incentives for the sector.
- Principal Asset Management chief global strategist Seema Shah predicted that data-center developers will likely be required to invest more in local electrical grids and could lose tax incentives, pushing up overall project costs.
- Franklin Templeton’s Stephen Dover suggested the AI and data-center trade may have become 'overheated' and argued that a politically driven slowdown could curb excessive, low-return investment.
📰 Source Timeline (2)
Follow how coverage of this story developed over time
- As of Wednesday afternoon, November 4, 2026, political research firm Redbud Consulting counted 37 voter-approved ballot measures restricting data centers nationwide and only one local vote approving a new data center.
- Franklin Templeton strategist Stephen Dover told CBS News the midterm results are likely to slow data-center construction and increase regulatory costs for developers.
- Tech analyst Dan Ives estimated that between 800 and 1,000 U.S. data centers are planned to support AI, and said the election will 'clearly' slow that buildout, singling out Texas as a key state at risk.
- GLJ Research CEO Gordon Johnson estimated that governor-elect Gina Hinojosa’s victory in Texas could stall about 13 gigawatts of planned data-center power capacity in the state.
- The article clarifies that former Gov. Greg Abbott had already imposed a moratorium on Texas data-center approvals, making it possible for Hinojosa to maintain the freeze without passing new legislation.
- Governor-elect Keisha Lance Bottoms told 'CBS Mornings' on Wednesday, November 4, 2026, that she will immediately sign an executive order pausing new data center construction in Georgia and will review existing tax incentives for the sector.
- Principal Asset Management chief global strategist Seema Shah predicted data-center developers will likely face requirements to invest more in local electrical grids and could lose tax incentives, pushing up their costs.
- Franklin Templeton’s Dover suggested the AI and data-center trade may have become 'overheated,' and that a political-driven slowdown could curb excessive, low-return investment.