US municipalities impose moratoriums on data center construction amid infrastructure and energy concerns

A powerful wave of bipartisan public opposition is sweeping across the United States as local municipalities and state governors impose moratoriums on data center construction. Driven by concerns over massive electricity demands, water consumption, and rising utility bills, communities from Michigan to New York are blocking projects. In Michigan, Gibraltar faces a developer lawsuit over its moratorium, while Ypsilanti Township has paused electrical infrastructure for a $1.2 billion University of Michigan facility. Despite criticism from President Donald Trump, who warns that halts cede technological leadership to China, governors like Kathy Hochul and Greg Abbott continue to defend regulatory pauses.

Municipal data center moratoriums

• ▪The Gibraltar City Council unanimously approved a 12-month moratorium on March 9, 2026, prohibiting the establishment and use of data centers pending further study and enactment of city regulations.
• ▪The lawsuit filed by Raeden Acquisitions and CAL Realty LLC alleges that Gibraltar's moratorium was adopted specifically to suspend or defeat review of their pending application for a data center at a former McLouth steel mill site.
• ▪Raeden Acquisitions and CAL Realty LLC filed a lawsuit on August 17, 2026, in the U.S. District Court for the Eastern District of Michigan against the city of Gibraltar, Michigan, over a one-year data center moratorium.

Electrical infrastructure requirements

• ▪Ypsilanti Township, Michigan, unanimously approved a 180-day moratorium on major electric utility infrastructure in August 2026 to study the potential noise and grid impacts of a proposed $1.2 billion data center.
• ▪The University of Michigan selected a 144-acre site on Textile Road in Ypsilanti Township for a 220,000-square-foot hyperscale data center, developed in collaboration with Los Alamos National Laboratory for nuclear weapons research.
• ▪Ypsilanti Township Supervisor Brenda Stumbo criticized the University of Michigan's site selection as a travesty of justice, stating it failed to address residents' concerns regarding environmental and noise impacts.

Water resource consumption

• ▪In April 2026, Ypsilanti Township approved a 365-day moratorium on delivering water to hyperscale data centers to study the impact of the proposed facility's estimated 500,000 gallons per day water demand.
• ▪The University of Michigan threatened legal action against Ypsilanti Township over the April 2026 water moratorium, characterizing the township's regulatory delay as discriminatory.

Bipartisan public opposition

• ▪An Annenberg Public Policy Center survey conducted in June and July 2026 found that 61 percent of Americans oppose the construction of new data centers in their local areas, up from 49 percent in early 2026.
• ▪The Annenberg Public Policy Center survey revealed that local data center opposition is bipartisan, with 69 percent of Democrats, 54 percent of Republicans, and 53 percent of independents opposing new local facilities.
• ▪A June 2026 survey by Echelon Insights found that 34 percent of respondents supported building a nuclear power plant in their community, compared to only 27 percent who supported an AI data center.

Tech industry political challenges

• ▪More than 230 activist organizations, led by Food & Water Watch and including Greenpeace and Friends of the Earth, have formally demanded a national data center moratorium.
• ▪Local opposition delayed or blocked at least 75 U.S. data center projects worth approximately $130 billion during the first quarter of 2026.
• ▪The House Energy and Commerce Committee opened an investigation to explore potential Chinese influence on U.S. energy policy and anti-data center campaigns.

Trump administration response

• ▪Texas Governor Greg Abbott defended his state's data center pause and grid audit, despite public criticism from President Donald Trump regarding the halt.
• ▪New York Governor Kathy Hochul defended her executive order pausing data center construction, stating that communities powering AI deserve to share in its success rather than receiving scraps.
• ▪President Donald Trump criticized New York Governor Kathy Hochul's executive order pausing large data center construction, calling it a terrible decision that would hand jobs and tax revenue to other states.