The rapid expansion of AI data centers is encountering a major obstacle: communities that don’t want massive data centers built in their neighborhoods.

New research from Data Center Watch reveals that local opposition blocked or delayed 45 U.S. data center projects valued at approximately $68 billion during the second quarter of 2026. These developments accounted for more than half of the new large projects the organization began monitoring between April and June.

This trend is a thorny challenge for tech giants investing billions in AI infrastructure. Even with vast capital and access to next-gen hardware, developers need to get approval from communities worried about electricity costs and environmental impacts.

Data Center Watch, a research initiative of AI company 10a Labs, identified 843 opposition groups operating across 49 states. Hawaii is the only state without a documented group.

The movement has gained major momentum in 2026. During the first quarter, approximately 75 projects representing $130 billion in investment encountered community opposition. Although the second-quarter figures were lower, the continued disruption means that local resistance has become an established roadblock for the data center industry.

Amazon, Microsoft, Alphabet and Meta are investing heavily in data centers across the country. For nearby residents, the concern is how these demands will affect their communities, including increases in electricity costs, water consumption, noise and the amount of land occupied by data centers. A survey conducted by The Economist and YouGov found that roughly two-thirds of American respondents opposed having a data center constructed in their local area.

The opposition is also affecting projects before construction plans are formally submitted. Communities are adopting temporary bans on new data center development, while state governments are examining how facilities obtain electricity, access water and pay for infrastructure improvements.

According to Data Center Watch, 30 state legislatures introduced or adopted measures addressing data center development during the 2026 legislative session.

New Complications

Still, the financial benefits of data centers complicate the debate. For instance, Loudoun County, Virginia, a major U.S. data center hub, projected approximately $1.2 billion in property tax revenue from these facilities in fiscal 2026, or about 39% of the county’s total revenue.

The tax contributions have helped reduce residential property and vehicle taxes, demonstrating why some governments welcome data center investment despite community concerns.

However, questions about transparency remain. Research by the Virginia Mercury found that nondisclosure agreements were signed in 25 of 31 Virginia jurisdictions with existing, approved or proposed data centers. These agreements have prompted concerns about whether residents get sufficient information before local governments approve data center projects.

For big tech companies, the resistance introduces uncertainty into an already expensive expansion. Among the new challenges: a proposed facility can require billions in investment, but access to financing and advanced GPUs does not guarantee that construction can proceed. Local opposition can delay permits, force developers to revise plans or prevent projects from moving forward.

Furthermore, the movement is extending beyond the U.S. Data Center Watch has documented campaigns against data center development in Europe, Australia and South Africa, where communities are raising similar questions about infrastructure and resource consumption.