More than 100 data centers dot Silicon Valley landscape, with more on the way
San Jose and other California cities are grappling with the rapid expansion of data centers, prompting concerns about strain on the power grid, water use, and carbon emissions. Residents have lobbied for a temporary construction moratorium, while the City of San Jose, led by Mayor Matt Mahan, is hosting community forums and developing a blueprint for responsible data center development, including a major agreement with PG&E for energy delivery. The city has already approved significant data center square footage and broke ground on a Microsoft facility.
The rapid expansion of data centers across Silicon Valley and California is prompting both economic development and significant environmental concerns, with cities like San Jose and Santa Clara becoming major hubs. The Gilroy Dispatch reports that while San Jose already hosts 47 data centers with 34 more projects under review, residents and climate groups are advocating for a temporary construction moratorium due to worries about the power grid, water consumption, and carbon emissions.
In response to these concerns, the City of San Jose has initiated community forums, culminating in the AI Infra Summit 2026 at the Santa Clara Convention Center, which will address challenges in AI infrastructure, scalability, and energy. San Jose Mayor Matt Mahan is actively championing data center development, having secured an agreement with PG&E to deliver over 2,000 megawatts of energy to establish San Jose as a premier destination for data centers. Under his tenure, San Jose has approved more than one million square feet of data center development, including a recent groundbreaking for a Microsoft data center in Alviso.
State and national data indicate a robust growth trend, with California ranking third in the U.S. for data centers after Virginia and Texas. Energy and water watchdogs are issuing warnings about the increased demands on public utilities and the potential environmental impact, citing studies that project a significant rise in data center energy use and greenhouse gas emissions. Santa Clara, with 69 data center sites, already dedicates 60% of its city-owned utility’s energy to these facilities.