Activists Challenge Big Tech's Data Center Boom with New Tactics

Opponents of the AI data center boom are starting to make headway by negotiating with tech firms, filing lawsuits, and starting grassroots social media movements. Their efforts have resulted in $64 billion worth of US data center projects being stalled or stopped. Critics point out that data centers are pushing up electricity bills, consuming massive amounts of water, and potentially causing electrical fires and blackouts. While Big Tech firms tout economic benefits, communities are often caught by surprise when data centers are announced and local zoning laws are changed. State legislators' efforts to enact regulations have fallen short.

The AI data center boom, fueled by the growing demand for artificial intelligence (AI) computing capacity, has seen significant investments from private equity firms like Blackstone. However, the expansion has not been without its challenges. Opponents, citing environmental concerns and community impacts, have started to make headway, resulting in $64 billion worth of US data center projects being stalled or stopped [1].

Blackstone has doubled down on its investment in Aligned Data Centers, increasing its senior secured debt facility to more than $1 billion, aiming to roll out five gigawatts of new data center capacity across the Americas [1]. This move underscores the firm's belief in the potential of AI and the need for robust infrastructure to support it. However, these investments come with significant environmental and community costs.

Critics argue that data centers are pushing up electricity bills, consuming massive amounts of water, and potentially causing electrical fires and blackouts. Google's recent report on the energy consumption and carbon emissions of its Gemini AI model highlights the environmental impact of AI infrastructure, with the median text prompt using 0.24 watt-hours of energy and emitting 0.03 grams of carbon dioxide equivalent [2].

While Big Tech firms tout the economic benefits of data centers, communities are often caught off guard when these facilities are announced and local zoning laws are changed. Applied Digital, for instance, plans to build a $3 billion, 280-megawatt "AI factory" in South Dakota, reflecting the growing demand for AI computing capacity [3]. However, the project has faced local opposition due to concerns about environmental impact and community disruption.

State legislators' efforts to enact regulations have fallen short, leaving communities vulnerable to the impacts of data center expansion. The U.S. Department of Energy projects that data centers could account for 6.7% to 12% of U.S. electricity use by 2028, further exacerbating environmental concerns [2].

The AI data center boom presents significant opportunities for investors and financial professionals. However, it also requires careful consideration of environmental and community impacts. As the industry continues to grow, ongoing monitoring and improvement of AI's environmental footprint will be crucial. Google's methodology and findings set a new standard for transparency in the industry, potentially paving the way for more comprehensive and accurate assessments of AI's ecological footprint [2].

References:
[1] https://finance.yahoo.com/news/blackstone-bets-big-1b-power-220737385.html
[2] https://theoutpost.ai/news-story/google-unveils-groundbreaking-data-on-ai-energy-consumption-19372/
[3] https://www.aberdeennews.com/story/news/2025/08/21/applied-digital-plans-ai-factory-in-south-dakota-what-to-know/85738464007/