Data center development may slow after voters across the US elected candidates who ran explicitly to impose moratoriums in some of the industry's fastest-growing markets and approved measures aimed at restricting expansion into local communities.
In Texas, voters elected Gina Hinojosa (D) to replace Governor Greg Abbot (R), who just last year said he wanted to turn Texas into the "epicenter" of data center development before reversing course this summer and temporarily pausing new approvals. In Ohio, Senator Sherrod Brown (D) ousted the incumbent John Husted (R) after calling him "the face" of data centers in Ohio.
Meanwhile, nearly 50 local ballot measures around the country that would ban or tighten restrictions on data centers appear poised to pass.
"The results increase political, permitting and regulatory risk for data center developers, utilities and large power users," energy consultancy Baringa said in a report Wednesday.
The uncertainty in how the winners translate campaign rhetoric into policy is likely to force a reassessment of expectations for data-center growth, particularly in Texas, with some projects likely to be delayed or canceled while developers await details of new state policies, analysts said.
Concerns about data centers have expanded beyond questions over who pays for new power infrastructure to a broader debate about artificial intelligence, community impacts and the influence of large technology companies, said Ben Heininger, a senior manager at Baringa.
"The challenge that these companies are dealing with has broadened outside of something that's actually quite easy to solve," Heininger said "The fear has widened outside of 'my electricity bills are going to go up slightly'."
The policy uncertainty is also prompting the industry to reassess forecasts for the electricity and natural gas demand growth that had been expected from a wave of new artificial-intelligence infrastructure.
For example, East Daley Analytics estimates data centers could add about 1.7 Bcf/d of Texas gas demand by 2030 under projects it currently classifies as "very likely" and "likely." Election-related uncertainty could push some of that growth to beyond 2030 if projects are delayed, said Jack Weixel, vice president of analytics at East Daley Analytics.
"If you're targeting about 1.7 Bcf a day of gas growth by 2030, then maybe the real number is 1 Bcf a day," he said, referencing a scenario in which political opposition pushes some projects further into the future.
"The threat to data centers is real," said Weixel. "I don't think it kills data centers in Texas, but it certainly puts them on hold."

