Analysis-Investors see risk from US midterms to AI trade as data center backlash builds
The Reuters analysis examines how growing public opposition to data centers could affect AI-related investment and construction as the U.S. midterm elections approach. Analysts expect Democratic control of Congress or state governments to bring greater scrutiny and potentially increase regulatory uncertainty, though they do not expect national legislation to halt the data center buildout.
Investors are increasingly concerned that public backlash over data centers could disrupt the AI investment boom. Residents have raised concerns about environmental impacts, energy costs and the rapid expansion of infrastructure supporting artificial intelligence, while spending on data centers and related infrastructure is expected to exceed $1 trillion next year.
The analysis says Democratic victories in Congress could lead to more hearings and investigations into AI and data centers, although analysts doubt President Donald Trump would sign legislation that significantly slows construction. Investors are also watching state and local elections, including races in Texas and several other states, because governors, legislatures and utility regulators can influence development rules, costs and project timelines.