Data Centre War Is Just Drama, Many Are Just Big Talk

The rapid development of artificial intelligence (AI) is driving technology companies to compete in building data centres.

However, these projects are increasingly facing opposition because they are seen as consuming electricity, causing noise, and burdening the surrounding environment.

The opposition has even begun to become a political issue in the United States, especially ahead of the midterm elections in November 2026. A number of local officials are competing to show a firm stance against data centre construction.

Yet the situation is not straightforward. Many projects that are said to have been cancelled or scaled back had, from the start, no clear funding, permits, or electricity supply.

Citing The Economist, which assesses that opposition to data centres in the US is often exaggerated, the same applies to developers who frequently announce construction plans on a far larger scale than their ability to realise them.

One example is the data centre project announced by Kevin O’Leary, the entrepreneur famous from the television programme Shark Tank.

In February 2026, O’Leary stated that he would build one of the world’s largest data centre projects in Utah.

However, the announcement did not draw a significant response from the market. Industry players questioned O’Leary’s experience, the project’s financing sources, and the availability of the required electricity.

One analyst even described the project as electricity capacity that is only large on paper.

Although it remains unclear whether it will materialise, the plan triggered political uproar. In June, Utah Senate President J. Stuart Adams, who initially supported the project, asked for its capacity to be cut by up to 75%.

O’Leary eventually agreed to reduce the project’s scale. However, the controversy still affected the political careers of Adams and two local officials who subsequently lost in the primary elections.

A similar situation occurred in Arizona. Vermaland, a land management company, previously announced plans to build a data centre with a capacity of 3 gigawatts (GW).

After opposition emerged from local residents, the project’s capacity was reported to have been cut by up to 80% in May.

However, according to an analysis by securities firm Bernstein, the project was from the outset among the plans whose realisation was doubtful.

Pennsylvania Governor Josh Shapiro also responded to the opposition against data centres by signing an executive order on 18 August 2026.

He said the rule was intended to curb speculative proposals that unsettle residents but are in fact unlikely to be built.

Of more than 100 data centre projects announced in Pennsylvania, Shapiro said fewer than a fifth had applied for the necessary permits.

The data shows that many project announcements are still at the planning stage and have not met the basic requirements to begin construction.

Data centre developers also do not consist solely of large technology companies.

Behind Google and Amazon are property developers, investment firms, new cloud computing service providers, and cryptocurrency industry players.

However, their ability to realise projects varies.

Bernstein considers construction plans from large companies such as Google and Amazon to be relatively credible.

By contrast, the plans of cloud computing service providers such as CoreWeave and Nebius are judged to have only about half the certainty of the announced capacity.

O’Leary’s project was not even included in the calculation because it was considered too difficult to confirm.

Ahead of the midterm elections in November 2026, a number of US officials are beginning to strengthen their image as defenders of residents against data centre construction.

However, the policies they announce do not necessarily stop large-scale projects.

In July, the Governor of New York announced a one-year moratorium on large data centre projects.

Even so, the policy does not apply to projects that have already received approval. New York is also not a primary location for data centre construction in the US.

Virginia imposed an electricity tax worth US$600 million on data centres. However, the state still maintains a sales tax exemption worth roughly three times as much.

In Pennsylvania, new rules require projects to obtain local government approval before being processed by the state government.

The policy may slow new applications, but it does not automatically halt construction altogether.

A similar situation is seen in Texas, one of the most sought-after locations for data centre construction.

The state has a large area, abundant energy supply, and skilled workers accustomed to handling large-scale infrastructure projects.

However, the Texas electricity grid operator has received connection requests with a capacity reaching 474 GW.

That figure is more than five times the current peak electricity demand of the Texas grid, which is around 90 GW.

The gap shows that not all connection requests are likely to develop into projects that are actually built.

On 3 August, Texas Governor Greg Abbott announced an audit of data centre projects. The review is expected to last until after the midterm elections.

Interestingly, a number of large data centre operators have expressed support for the move.

Although resident opposition and political debate are growing louder, the proportion of data centre projects that are delayed or cancelled has remained relatively unchanged.

Over the past year, the figure has hovered around 10% of all planned projects.

That number has held steady even as project announcements have increased and political opposition has become more frequent.

For developers, the biggest obstacles actually stem from more fundamental issues, such as chip availability, electricity supply, labour, and infrastructure readiness.

Data centres for AI require large amounts of energy so that servers and cooling systems can operate continuously.

As a result, projects that lack adequate electricity access or have not secured essential components will struggle to proceed, even if they face no resident opposition.

Conversely, construction that already has funding, permits, and infrastructure support is usually harder to stop.

Politicians also tend to be reluctant to cancel projects that have already entered the construction phase because they involve investment and jobs.

If one region tightens its rules, developers can still move projects to other locations.

So far, a number of projects have begun shifting to the western US, which offers more land and greater potential energy supply.

Construction could also be directed to federal government land or even abroad.

In the end, some data centre plans will indeed be scaled back, delayed, or cancelled. However, many of the projects that fall through also lacked a strong foundation for realisation from the start.

On the other hand, the tough stance of a number of politicians does not necessarily lead to the halting of construction that is actually underway.

As long as the need for AI computing continues to grow, data centre construction is expected to continue, although not every project will be as large as developers announce.