Fortune columnist proposes requiring data centers to cover community costs
Mark Drapeau, founder of Veleonis and editor-in-chief of the Data Catalyst Institute, proposed in a Fortune column that AI data center operators should cover infrastructure, energy, and community costs due to growing opposition in the United States. He outlined a reciprocal agreement where operators would finance grid connections and disclose project impacts, while states ensure stable conditions. This comes as communities express concerns over rising electricity bills, infrastructure strain, and water resource depletion, exemplified by Pennsylvania Governor Josh Shapiro's new requirements for data center projects.
Amid intensifying opposition to AI data center construction across the United States, Mark Drapeau, founder of Veleonis and editor-in-chief of the Data Catalyst Institute, has proposed a framework for operators to cover the costs their projects impose on local communities.
Drapeau highlighted that politicians, including Pennsylvania Governor Josh Shapiro, are increasingly scrutinizing data center developments. Governor Shapiro, for instance, has removed AI data centers from an expedited review program, introducing new requirements for local approval, commitments regarding electricity, water, and community benefits, and prohibiting state agencies from entering nondisclosure agreements that could conceal project terms.
Community concerns stem from fears of rising electricity bills, infrastructure strain, prolonged construction, and pressure on local water resources, particularly from evaporative cooling methods. Public sentiment reflects this, with a Gallup poll indicating 71% of Americans oppose an AI data center in their area. A Veleonis and co/efficient survey further revealed that three-quarters of voters are undecided or distrustful of companies operating such facilities, and half desire more information on a project's impact on electricity, water, or the environment.
With estimates from Lawrence Berkeley National Laboratory projecting data centers could consume up to 15.3% of U.S. electricity by 2030, Drapeau proposes a reciprocal agreement. Operators would finance new substations and grid connections, pay for reserved capacity, add regional generation, and offer compensation if projects are abandoned. In return, states would guarantee stable tax and permitting conditions, alongside coordinated project review with clear requirements and deadlines.