Data centers have a politics problem - and industry knows it

The companies that build and run data centers are on the losing end of a
populist backlash — and they’re struggling to respond. 

Fears that the server-packed data hubs will drive up electricity prices,
deplete water supplies and gobble farmland have prompted people across
the country to pack meetings of zoning boards and county commissions to
oppose the projects, while fueling calls from leaders in both parties
for state or national moratoriums. That opposition has become a rising
obstacle for an industry that is in the process of developing an
estimated 1,500 data centers, in large part to support the growth of
artificial intelligence. 

In response, the data center companies have tried to sell their projects
as a boon to tax revenues and employment — though too often, they fail
to actively communicate with the public, tech industry policy advocates
and executives told POLITICO. That messaging void has let their critics
gain the upper hand. “The void gets filled with misinterpretations about
what we do and what impacts we have,” said CleanArc Data Centers chief
commercial officer John Day. 

Results this month from The POLITICO Poll reveal the scope of the
industry’s predicament, showing that majorities of Americans now believe
key arguments from the industry’s opponents, such as the idea that the
projects will make electricity more expensive. That’s a departure from
just six months ago, when most Americans were either undecided or
disagreed with key statements of the opposition. 

Not even President Donald Trump’s vocal support for building data
centers has stanched the bleeding, even in Republican-dominated states. 

“I don’t think the problem is the way that we engage with communities,”
said Kirk Offel, CEO of the data center operations company OVERWATCH
Mission Critical. “I think we just haven’t.” 

‘Just be quiet’
The builders’ and operators’ public relations problems mirror the larger
travails of the artificial intelligence industry’s giants, including
SpaceX, OpenAI and Meta, whose efforts to win the messaging and
political battle over data centers and AI have faced headwinds at the
ballot box and a spate of negative headlines and legal woes. 

But it’s in some ways a more daunting quandary for the smaller, less
visible companies that have been the data center industry’s backbone for
decades. Companies in the sector have traditionally flown under the
radar, given that they often handled sensitive data and rarely, if ever,
got embroiled in political feuds. 

“The data center industry always kept everything kind of secret because
it was a bit of a risk,” said Carrie Goetz, chief technology officer of
the data center IT services company StrategITcom. “It was the course of
anybody know.” 

The AI boom is compelling data center companies to communicate more with
the public. Goetz notes that there has been an industry trend of
creating new community liaison positions over the past two years. 

Still, many companies are playing catch up because they haven’t
previously established extensive PR operations. 

“Data center companies aren’t marketing a consumer product,” said Wes
Cummins, chairman and CEO of the data center developer and operator
Applied Digital. “You don’t typically have a big PR department that has
dealt with anything like this before.” 

Many of the messaging battles have been local. Patrick Hughes, a senior
vice president for the National Electrical Manufacturers Association,
said the resistance is particularly fierce when a company doesn’t
provide information to communities before breaking ground on a
construction project. 

“Where projects go astray is when the community finds out because a plot
of land is being cleared and construction is already going,” Hughes told
POLITICO. “At that point, it’s already too late to have that
conversation around how this is going to benefit people.” 

Yet the data center industry has long been used to keeping information
under wraps, and nondisclosure agreements with local officials has
traditionally been common practice. Such agreements have recently led to
backlash in municipalities like Salem, Oregon, and Posey, Indiana. 

“When [data center companies] have gone into communities, they’ve had
those municipalities enter into non-disclosure agreements, so the data
around consumption have been in a black box,” said Michelle Lopes
Maldonado, associate director of AI policy at the Information Technology
and Innovation Foundation. “It’s when we don’t share the full picture
that people start to fill in the gaps with their own information.” 

Messaging around the benefits of the facilities is failing to resonate
with the public. The POLITICO Poll — which surveyed 2,061 U.S. adults
online from July 12 to July 15 — found that just 16 percent of people
agreed that data centers “benefit the area they are built in and the
country as a whole,” while roughly 60 percent said they either come at
the expense of the local area or the country or provide no benefits at
all. 

Instead, negative messaging seems to be taking hold.

FCC chair Brendan Carr on Trump, free speech and his threats against
broadcasters Higher electricity costs, for example, are Americans’ top
concern when it comes to building data centers, the results show. In
January, 43 percent of Americans said they believe that “data centers
raise people’s electricity bills.” This month, that share jumped 16
points to nearly 60 percent of Americans who said the same. 

The share of Americans who said data centers deplete the water supply
grew from 34 percent to 55 percent during the same period. 

More Americans believe negative messaging surrounding data centers
Share of adults by responses in January and July when asked if a given
statement was true or false as far as they were aware, by statement 

Data centers raise people’s electricity bills
25%
50%
75%
True
+16%
False
-11%
January|July|
Data centers deplete the water supply
25%
50%
75%
True
+20%
False
-19%
Data centers are bad for the planet
25%
50%
75%
True
+17%
False
-13%
The July edition of the POLITICO Poll was conducted by Public First from
July 12-15, surveying 2,061 U.S. adults online, with an overall margin
of error of ±2.16 percentage points. The January edition was conducted
Jan. 16-19, surveying 2,093 U.S. adults online, with a ±2 percentage
point margin of error. Smaller subgroups have higher margins of error.
Numbers may not add up to 100 percent due to rounding. Those who
Public First Jessie Blaeser/POLITICO

Spreading the message on data centers’ purported benefits and costs has
been a challenge, according to Software and Information Industry
Association President Chris Mohr. He told POLITICO that the industry
broadly needs to work on getting that information to local government
leaders, who are often in the best position to communicate with
residents. 

“Local communities have been vocal about these projects,” said Mohr.
“It’s imperative that their leaders be armed with facts.” 

But Offel said people in office often don’t want to publicly discuss
such a contentious issue. 

“I’m sitting in rooms with mayors all the time, and they’re getting
killed at the next election,’” he told POLITICO. Instead of going
through proxies, Offel has been trying to directly engage with
communities — testifying in Congress and state capitols, hosting town
halls, launching a podcast and building a social media presence. 

Other data center executives haven’t been as willing to expose
themselves to a political firestorm. 

“The rhetoric has gotten so aggressive,” said iMiller Public Relations
CEO Ilissa Miller, who advises data center companies on messaging.
“Executives and companies who don’t want to get caught up in that are
not comfortable speaking with the media and not comfortable engaging.” 

Miller has been working to coax the industry out of its shell. A former
village trustee in Mamaroneck, New York, she’s been encouraging data
center companies to act more like politicians in a sense — advising them
to communicate with local churches and school districts, and to show up
at farmers’ markets and fairs. 

“Certain developers can get too aggressive in dictating what communities
ought to do, and that’s really what the backlash is about,” Miller told
POLITICO. 

The tech industry’s biggest companies, which rely on data centers to
power their AI and are involved in developing some of the most expansive
projects, have been mounting their own national messaging campaigns. But
that effort “hasn’t really landed that well,” Applied Digital’s Cummins
said. “We spend our resources locally. … We just don’t have the
bandwidth to be the mouthpiece nationally.” 

POLITICO previously reported that Meta poured millions of dollars into
ad campaigns promoting data centers as an economic engine, and AI trade
group representatives have been leading tours of the facilities to tout
their benefits. 

Yet Meta also cut a secret tax and public land use deal with Louisiana
officials to build a data center, as the New York Times recently
uncovered. “That sets all of us back,” said Roshan Shah, co-founder and
CEO of the AI data center developer Decimal Digital. “It adds fuel to
the fire, and adds to the local distrust that we’re already facing.” 

Meta spokesperson Ashley Settle told POLITICO in a statement that the
deal “went through established state and local economic development
processes and approvals … the same process used in many states across
the country to attract long-term investment.” 

Moratoriums gain momentum
The stakes are rising for data center companies contemplating whether to
be more aggressive about messaging in the face of a rising push for
moratoriums. 

Democratic New York Gov. Kathy Hochul signed an executive order in July
establishing the United States’ first statewide pause on large data
center construction, and progressives in Congress have proposed such a
moratorium for the nation. 

Some Republicans, notably Rep. Nancy Mace of South Carolina, have jumped
on the moratorium bandwagon as well. 

The push for pauses has thrown a wrench into plans for new data centers.
That includes a project in Monroeville, Ohio, which Decimal Digital had
to put on hold after the village council imposed a one-year ban on data
center construction in February. 

“We were completely blindsided,” said Shah, Decimal Digital’s CEO. He’s
resolved to get information to residents by holding town halls during
the pause, in the hopes that they will come around by the time it’s
over. 

“[We’re] doing everything that we can to make sure people make an
informed decision here,” he said. 

Proposals for data center moratoriums are also playing a central role in
some races for the upcoming midterm elections. The POLITICO Poll found
that voters are warming to the idea. 

A 49 percent plurality of Americans said they would support a local
candidate who proposes a statewide data center moratorium “to ensure
that there is no impact on energy and water costs in the area.” Just 28
percent said they would vote for the candidate who proposed tax breaks
for data centers to ensure economic growth in the state. 

Given current trends in public opinion, Monument Advocacy’s chief AI
officer, Joseph Hoefer, said the midterms may serve as a “deadline” for
the industry to “to get their public case built before the politics get
any louder.” He told POLITICO, “Data centers have gone from a niche
infrastructure issue to a kitchen-table political issue, and both
parties are keenly aware.” 

https://www.politico.com/news/2026/08/01/data-centers-have-a-politics-pro
blem-and-industry-knows-it-01020412