Data center backlash is a very solvable problem, says Tusk Ventures' Bradley Tusk
New York has passed legislation to pause data center development, a move criticized by the President. Bradley Tusk of Tusk Ventures argues that data centers need to address public concerns by internalizing costs for energy and water and acting as good community partners to overcome widespread opposition, which has been fueled by rising electricity bills in areas with data centers like Northern Virginia and Georgia.
Bradley Tusk, founder of Tusk Ventures, discussed the growing backlash against data centers, asserting that the problem is solvable if data centers learn to "pay their own way." He refuted the idea that data center development will become a purely "red state" vs. "blue state" issue, arguing that data centers need to be close to population centers to power AI, and that regulation is emerging across both red and blue states.
Tusk highlighted New York as the first state to pass legislation to pause data center development, a move that drew criticism from the President. He referenced New York Governor Hochul's executive order, which mandates data centers cover their own energy and water costs. Tusk emphasized that public opposition stems from concerns over job losses, increased electricity prices, and perceived negative societal impacts of AI.
He cited specific examples of rising electricity prices in Northern Virginia, Ohio, Pennsylvania (linked to the PJM Grid), and Georgia, where public backlash led to 40% of the Georgia Public Utility Commission losing elections. Tusk believes solutions involve data centers developing behind-the-meter power sources (like nuclear or turbines), using more efficient compute, and implementing closed-loop water systems. He also stressed the importance of data centers being good community partners, assisting with property tax abatements or modernizing energy grids when seeking zoning and permitting approvals.