The data center backlash is here — and Big Tech is spending big to shape it
California lawmakers are facing intense public backlash against data centers, leading to the introduction of seven bills aimed at regulating these facilities. Major tech companies and utility providers are spending heavily to lobby against these legislative efforts, which seek to address concerns over utility costs, water use, and grid strain. The outcome of these bills, expected by late September, is poised to influence future data center development and environmental regulations across the state.
California is currently experiencing significant public opposition to data center construction, which has prompted state legislators to introduce seven bills designed to regulate these facilities. The proposed legislation seeks to address growing concerns over utility costs, water consumption, and the strain on the power grid.
In response, major tech companies, including Amazon and AI firm Anthropic, along with utility giants like Pacific Gas & Electric (PG&E) and Southern California Edison, are heavily lobbying the California Legislature. PG&E, for example, reported its second-highest lobbying quarter since 1999, spending approximately $143,000 on data center-related issues. The industry's financial push aims to either halt or dilute these proposed regulations, some of which would shift the cost of grid expansion from general users to data center operators.
Public sentiment is largely against new data center developments, with polls indicating widespread community opposition. This backlash has already led to local actions, such as a permanent data center ban passed by voters in Monterey Park and the reversal of approvals in Pittsburg. Advocates for stronger regulation emphasize transparency and the protection of public resources, arguing that everyday consumers should not bear the burden of increased infrastructure costs. Conversely, industry groups contend that the bills would impede technological innovation and disproportionately burden data center construction.
California Sen. Steve Padilla and Assemblymember Diane Papan are among the lawmakers authoring these bills. The fate of these measures, expected to be decided by late September, is seen as a crucial indicator for how similar data center regulatory battles may unfold nationwide, reflecting a significant shift in the political landscape due to voter sentiment.