Jan. 2 (oilprice.com) As tech companies worldwide invest heavily in the deployment of large-scale data centres to power advanced technologies, not everyone is so happy about the new phenomenon. Concerns over energy security and a prolonged reliance on fossil fuels are just two of the issues that are repeatedly coming up, as governments seek to better regulate the sector.
In the United States, $64 billion in data centre projects have been blocked or delayed due to growing opposition. A Data Centre Watch report estimates that $18 billion worth of data centre projects were blocked, while $46 billion of projects were delayed over the last two years, due to opposition from residents and activist groups. The study showed that there were at least 142 activist groups across 24 states organising to block data centre construction and expansion.
Some of the main reasons individuals and groups cite for their opposition to data centre development include higher utility bills, water consumption, noise, impact on property value, and green space preservation. A recent survey shows that while the majority of United States residents support data centres in theory, many are sceptical about the development of these centres in their communities. This is true across both political parties.
The opposition is driving political change. For example, in Warrenton, Virginia, residents voted out all town council members who showed support for Amazon’s proposed data centre in the November 2024 election. The newly elected council has since established a mandate to block the development of the data centre.
In the state of Georgia, when the Democratic candidate Peter Hubbard was voted into office, he noticed that there was one new topic of focus for his constituents – data centres. “The number one issue was affordability,” said Hubbard. “But a very close second was data centres and the concern around them just sucking up the water, the electricity, the land—and not really paying any taxes.” Georgia has become one of the fastest-growing markets for data centre development in the United States, particularly popular because of its tax breaks.
In December, a coalition of over 230 environmental groups demanded a national moratorium on the construction of new data centres in the United States. Many organisations blame the data centres for escalating electricity bills and worsening the climate crisis. The coalition includes representatives from Greenpeace, Friends of the Earth, Food & Water Watch, as well as dozens of local organisations. This follows billions of dollars of investment from tech majors, such as Meta, Google and OpenAI, into new data centres, which could change the future of U.S. energy demand if they are all constructed.
“The rapid, largely unregulated rise of data centres to fuel the AI and crypto frenzy is disrupting communities across the country and threatening Americans’ economic, environmental, climate and water security,” states the letter from the coalition to members of Congress. The coalition calls for a pause on development until new regulations are established.
In addition to the vast quantities of energy needed to power data centres, recent research showed that the facilities also required large amounts of water to cool down equipment. According to the International Energy Agency, in 2024, electricity consumption from data centres was estimated to contribute around 415 terawatt hours (TWh), or about 1.5 percent of global electricity consumption, having grown at 12 percent a year over the previous five years.
In Latin America, Chile and Brazil are currently the two top countries for data centre development. The high levels of investment earmarked for the centres have attracted political support, although many residents are less enthusiastic about the developments. The lack of national regulation and environmental impact assessments for data centre construction means that many are established with little consideration for their impact on the environment and communities, which has spurred public protests.
In 2024, Microsoft opened a huge data centre in central Mexico. Following the launch, residents in the area complained of more frequent power cuts and water outages for days or weeks at a time. Microsoft responded to the complaints by saying that the region was already prone to unstable electricity supplies and that it used minimal water and had an electricity load of up to 12.6 MW, the equivalent of powering around 50,000 homes if used throughout the year.
While no definite link has been made between the new data centre and the power outages, it is clearly risky to develop these types of projects in regions with unstable grids and existing water strains. It could put added strain on the system and tip it to the breaking point if left unchecked. These types of projects are emerging in several countries around the globe and will likely have a knock-on effect on the surrounding areas if not properly managed by energy companies and governments, spurring greater backlash in the coming years.
By Felicity Bradstock