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Local Backlash Spurs Cities to Restrict Hyperscale AI Data Centers

Municipal bans and council-led reviews are straining utility planning and prompting new questions about the nation's future compute capacity.

Overview

  • This week Millville, New Jersey, voted to ban new data centers, a move that halts a proposed 1.4‑gigawatt campus and signals growing local authority over projects.
  • Chicago has convened public meetings and a city working group to draft policy recommendations aimed at boosting transparency and limiting water and power impacts from new facilities.
  • Federal and academic studies show the scale of the issue: U.S. data centers used about 4.4% of electricity in 2023 with projections rising sharply by 2028, and an average 100‑megawatt facility can use about 2 million liters of water per day.
  • Public opposition is strong, with a March Gallup poll finding roughly 71% of Americans oppose local AI data centers, and some advocacy groups say foreign funding has supported anti‑center campaigns while industry warns of a national compute shortfall.
  • The debate puts tangible local harms—higher electricity bills, heavy water draws, diesel backup emissions, and changes to community character—against industry claims of jobs and national strategic need, and it is driving moratoria, legal fights, and state and city rulemaking.