Rep. Nancy Mace is calling for a one-year halt on new data center construction in South Carolina, adding momentum to an intense national debate over the energy demands of AI infrastructure and who should pay for it.
The South Carolina Republican, who is currently running for governor, said the rapid spread of large-scale AI data centers threatens to drive up electricity costs for households and small businesses. Her proposal would temporarily pause new projects while lawmakers establish rules governing power consumption and utility costs tied to the facilities.
South Carolina has attracted hyperscale data centers with its tax incentives, and developers are also drawn by its large tracts of rural land. Industry estimates place at least 44 data centers across the state, including a major Meta campus in Aiken County. Yet controversy intensified in recent months after debate surrounding a proposed 1,000-megawatt data center project in Colleton County.
Mace argued that tech companies should be responsible for funding the enormous electrical requirements of these facilities rather than shifting costs to ratepayers.
Her proposal mirrors legislation recently advanced in Florida under Gov. Ron DeSantis. That measure requires data center operators to cover the full cost of the electricity and infrastructure upgrades needed to support their operations. Mace said South Carolina should adopt a similar framework to shield residents from subsidizing AI expansion.
Nationwide Debate
The dispute is part of a national reckoning over the infrastructure required to support generative AI. AI-focused data centers consume far more electricity per square foot than traditional office buildings, with energy use expected to rise sharply over the next several years.
The hardware inside these facilities has become increasingly power-hungry. NVIDIA’s latest AI systems, including its Blackwell Ultra platform and liquid-cooled GB200 rack-scale infrastructure, are built to support advanced reasoning models and agentic AI workloads, and require massive levels of electricity and cooling capacity.
The scale of investment has fueled deep concern in communities where data centers are being built. Critics argue that the facilities create relatively few permanent jobs compared with the enormous energy and water resources they consume. Research cited by advocacy organizations found that data centers accounted for more than 4% of US electricity consumption while employing a comparatively small workforce nationwide.
Opposition to data center construction has emerged across party lines. Earlier this year, Democrats Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez introduced legislation proposing a national moratorium on AI data center expansion until federal safeguards are established. Republican Sen. Josh Hawley has also backed legislation aimed at preventing utilities from passing AI-related energy costs to consumers.
At the state level, lawmakers in more than a dozen states have explored restrictions or temporary pauses on data center construction. Some proposals have stalled amid pressure from the tech industry and concerns about economic development. In Maine, a statewide moratorium bill was vetoed after disputes over exemptions for specific projects. Local governments have also begun taking action, including a Texas county that recently approved what may be the state’s first county-level data center moratorium.
The debate exposes growing tension between Washington’s push to accelerate AI leadership and local resistance to the physical infrastructure supporting it. While the Trump administration has largely favored reducing regulatory barriers for AI development, state and local officials are often now confronting backlash from residents worried about utility costs and environmental impact.
