Water, electricity remain major data center concerns, survey says

Local residents nationwide remain most concerned about the impact of data centers on their water supply and electricity costs, according to a recent survey.

Zencity, a platform that measures public sentiment and trust, found that 86% of those surveyed rate the impact of data centers on their local water supply as an important factor in their support, while 85% said the same about electricity costs. Those decision factors far outweighed job creation (65%) and tax revenue (61%) in whether residents choose to support data centers in their communities.

The survey found that 33% are unsure about whether they support or oppose building new data centers, while 35% support them and 30% said they are opposed. But an individual’s familiarity with artificial intelligence helps build support for data center construction, Zencity found. Sixty-three percent of those who say they are optimists about AI, and 48% of those who said they use AI daily said they support building data centers.

“As the digital economy matures, the demand for data centers has shifted from a technical requirement to a significant matter of public policy,” the report says. “Local governments are now tasked with navigating the tension between the high-growth potential of these facilities and the resident concerns regarding resource sustainability, neighborhood compatibility and institutional transparency.”

The survey comes as numerous states and localities are looking to build data centers and take advantage of the advertised economic boom, jobs and AI dominance that come with them. But the efforts have come under sustained fire from local residents, who worry about the impact on their utility bills and neighborhoods. Residents in several states will vote on data center development this fall, while Maine turned heads with a moratorium on such development that its governor vetoed in late April.

Zencity’s poll is one of a number of public surveys to show negative public sentiment towards data centers. Gallup found recently that seven in 10 Americans oppose data center construction in their local area, with much of that opposition tied to environmental and quality of life concerns. And YouGov found that Americans are twice as likely to view data centers as having a negative effect on their communities than a positive effect.

And most troublingly for state and local leaders, who traditionally have enjoyed far more trust than their peers in the federal government, those trust marks appear to be slipping. Zencity found that only 1 in 5 residents trust their local government officials to provide  accurate information on a proposed data center’s impact, compared to 57% that said they trust independent environmental organizations.

“What we're finding is that while people trust their local government more than state and federal they're trusting it less these days, and we're finding that there's a dichotomy in the trust between the elected officials and the public servants on there,” said Lee Feldman, Zencity’s senior advisor for local government strategy. “They tend to trust the civil servant a little bit more, not much more, but a little bit more than the elected officials.”

The data center industry is trying to push back hard against the prevailing narrative on electricity and water impacts, especially after a controversial project won approval in rural Utah and is projected to need 9 gigawatts of power and drive up the state’s carbon emissions.

In a study it commissioned from energy consulting firm Energy and Environmental Economics, the Data Center Coalition, a membership association for the industry, found no evidence that data centers drive higher residential electricity costs. Instead, the group blamed a variety of factors for rising bills, including inflation, wildfire mitigation, grid modernization and the volatility of the natural gas market.

The study argued that, in fact, large data centers generate surplus utility revenue that offset costs for other ratepayers, and that states like Virginia and Texas that have the largest load growth from data centers have seen smaller electricity rate increases.

Others, however, disagree. In its Municipal Infrastructure Conditions Report, the National League of Cities warned that while power infrastructure remains resilient, the “rapid expansion of data centers” presents an “emerging headwind.”

“The energy requirements of data centers may soon outpace incremental grid improvements, potentially necessitating accelerated capital outlays to prevent service degradation for residential and traditional commercial users,” NLC said.

The tension between national AI optimism and local concerns about the infrastructure needed to power it makes for an interesting proposition, Feldman said. He compared it to the advent of the automobile, which also prompted a reckoning about the future of the national economy while local sentiment focused on who would pay for the roads and the expanding transportation network needed to support them. Only time will tell how it shakes out.

“There are two things in this world,” Feldman said. “Everybody hates change and the way things are.”