It’s difficult, if not impossible, to recall an issue that’s gone from zero to 60 in America as fast as data centers. In fact, a post like this written on one day risks being utterly out of date two days later. I’m penning these thoughts fully aware of that, but…
From where I sit as a real estate and land use lawyer, data centers are a real estate development issue wrapped around one of the most profoundly disquieting issues of the last 50 years: the disruption that AI is going to cause in all of our lives, the lives of our children and on down.
NIMBY — and Deeper Fears
This is not like seeking a special use permit for the drive-thru of a CVS going in on the corner of Main and Main (something I fought battles on years ago, which seems quaint in retrospect). Each data center proposal dredges up existential angst, hatred of elites, water supply fears, distrust of surveillance — you name it. A proposed data center is a stand-in for everything we fear about the future.
Or, maybe, we just don’t like the idea of big humming buildings looming over our backyards, or transmission lines being run across the woods at the back of our lots through eminent domain — even if a given data center is going to do none of the above. AI is an abstraction, but a data center is not. For concerned residents, it is a large building being constructed down the road, along with new power lines, backup generators, a substation, and questions about water and electricity rates.
As noted in a New York Times article published on August 23, 2026, while NIMBY fears are the most common stated reasons for opposition, increasingly data centers are becoming symbols of the excesses of Silicon Valley.
“It’s very much a bottom up, organic movement,” said Anna Greenberg, a veteran Democratic pollster, as quoted in the article. “Data centers are a physical manifestation. Billionaires are building them, and it feeds into all of the big tech skepticism that is there. It’s very symbolic of everybody’s issues with A.I.”
At the same time, it is undeniable that data centers are essential infrastructure. They support cloud computing, AI, cybersecurity, communications, commerce and other parts of the modern economy. The Department of Energy has described data centers as powering critical services, supporting scientific discovery, strengthening national security and contributing to economic growth.
Their importance does not make every community concern wrong. Nor does it make every concern right. Some concerns may be overstated or based on assumptions, including about water use or grid impacts, because those issues vary significantly by project, location, technology and utility system. Furthermore, technology advances are happening at an accelerating rate: for example, modern data centers are being constructed with closed-loop water circulation technology that arguably moots the water usage issue. The purpose of public policy is to separate real issues from assumptions and decide what rules should apply.
The political response has been a growing number of moratoriums and pauses, at both the state and local level. A moratorium, though, is not a prohibition. It is a pause. Or at least that is what it is supposed to be.
A pause is only worth something if the government that imposes it uses it. The point is to buy time to write sound rules. The risk is that the pause becomes the whole plan; a way to calm anxious constituents without doing the harder work of deciding what the rules should be.
A data center moratorium should be used by a government to define the problem it is solving, the work it will do during the pause, and the standards that will apply when the pause lifts.
Moratorium approaches
Recent actions in New York, Texas and Pennsylvania show how different these pauses can be, even when they carry the same label.
On July 14, New York Gov. Kathy Hochul chose environmental permitting as the focus of a moratorium. She placed a one-year pause on issuing state discretionary environmental permits for new or expanded data centers while the state develops broader standards for environmental review, grid infrastructure, water, air quality, community impacts and related issues. “As data center development threatens to hike up utility bills, deplete our natural resources and create uncertainty for New Yorkers, it’s my responsibility to take action and lead,” Hochul said when she signed the order announcing the moratorium.
Texas Gov. Greg Abbott pressed different levers to halt the progress of data centers in his state, which has been quickly moving to displace Virginia as the state with the most data centers. Abbott directed the Public Utility Commission of Texas and ERCOT to audit roughly 1,800 projects seeking regulatory approval to connect to the Texas grid prior to interconnection approval and ensure they “pay for their electric infrastructure instead of shifting costs onto Texas families and small businesses, reuse their own water, reduce the cost of electricity for Texans, do not disrupt residential neighborhoods to preserve Texas’ quality of life, and pay their own way and eliminate reliance on outdated taxpayer-funded incentives.” Abbott’s statement is a pithy summary of the core issues emerging from angry debates across the country.
Reflecting how bipartisan this issue is, State Rep. Gina Hinojosa, D-Austin, Abbott’s opponent in November, immediately called on Abbott to do more — issue an emergency executive order to place a moratorium on all new data center development and call a special legislative session “until the legislature can come together and ensure these new data centers are built with American union jobs.”
On August 18, Gov. Josh Shapiro of Pennsylvania issued an executive order that did not have the word “moratorium” in it but significantly rearranged the sequencing of steps a data center developer needs to take and required all data centers to comply with the “Governor’s Responsible Infrastructure Development (GRID) Standards” announced in May.
The executive order requires data center developers to wait until all local approvals have been obtained before submitting permit applications to the state environmental agency and foreclosed the possibility that a data center could be reviewed in the state’s Fast Track permitting process.
Local moratorium and ban efforts — in counties and cities — are too numerous and varied to even try to summarize here.
The policy is what matters
The real test of a moratorium is not whether it responds to political pressure, but whether it produces better rules. That starts with identifying the real challenges associated with data centers.
Electric reliability, ratepayer cost, water use, noise, land use, tax incentives, public transparency … these are all issues that people are raising concerns about. They often overlap, but they are not interchangeable and do not always fall under the same level of government.
A county can regulate setbacks, noise and site design if state law gives it that authority. A utility regulator can address interconnection, tariffs, cost allocation and reliability. And a legislature may have to decide whether state agencies or local governments need additional authority.
A useful moratorium should be used to answer basic questions. What problem is it solving? Who has authority to solve it? What information is needed? What standards will come out of it? What happens when it ends?
A pause that cannot answer those questions may quiet the politics for a while, but it will not govern anything.
Beyond moratoriums
Moratoriums get attention. But they are not the only way to respond to public concern.
Some states and localities may decide a pause is necessary. Others may decide to keep projects moving while updating their rules. Either way, the same work needs to happen.
Communities need better information and answers to important questions, such as: What is being built? How much power will it require? What water, if any, will be used for cooling? What infrastructure will be needed? Who pays for it? What commitments is the developer making to the host community?
The Brookings Institution has made a similar point, arguing that moratoriums should not substitute for transparency, oversight and community engagement.
In other words, the goal should be to create guardrails that allow necessary infrastructure to be built responsibly, not to stop technology because people are anxious about it.
And that is true even where no moratorium is planned. A state or locality that wants to avoid a moratorium needs thoughtful rules to head off future public anxiety.
Conclusion
The politics around data centers are not going away, and they should not be dismissed. But broad fear is not a policy.
A pause may be appropriate in some circumstances. In others, the better answer may be to keep projects moving while adopting clearer rules. Either way, the work is the same: identify the actual problem, gather facts, inform the public and write standards that can be applied to future projects.
A moratorium is not a policy. At most, it is an opportunity to build one. I applaud what states are saying they are going to do during their pauses. Let’s just see how data centers fare as the midterms approach.
Jared Burden is a partner with GreeneHurlocker PLC. He is based in Harrisonburg.
