Voters across the United States overwhelmingly rejected data center expansion in dozens of local and state-level races during the 2026 midterm elections, signaling a major political shift that could restrict the infrastructure powering the artificial intelligence boom.
According to an analysis by The Intercept, candidates and ballot measures favoring restrictions on data center development won decisively on election night. Of 41 total ballot measures tracked by Ballotpedia, voters sided against data center development in all but one instance, a single measure in Harwood, North Dakota, which sought to require additional review for industrial developments including data centers.
Democratic victories reshape state and federal policy
The election results saw Democrats secure control of both chambers of the US Congress and flip at least five governors’ offices, including in Texas and Georgia, Moneycontrol reported. In Texas, Democrat Gina Hinojosa defeated Republican incumbent Greg Abbott, who had previously described the state as the epicenter of AI development
, NewsChannel20 reported. Hinojosa has pledged a moratorium on new projects and stated she would block permits if they do not provide clear benefits to residents or Texans.
Greg Abbott is still approving data centers in Texas despite his election year “pause.” That’s Abbott’s playbook: he sells us out and then lies about it. pic.twitter.com/ozFasjNs3W
In Georgia, Governor-elect Keisha Lance Bottoms has promised a temporary statewide pause on data center construction, according to The Intercept. Other notable shifts include the election of Democrat Dr. Amy Acton in Ohio, which NewsChannel20 noted creates significant risk for project delays in that state, as Acton has pledged to block projects that do not meet specific standards.
The political climate in Wisconsin is also expected to shift, with Democrat David Crowley elected as Governor. During his campaign, Crowley modified his stance to take a more aggressive position against data centers following pressure from his Republican challenger, NewsChannel20 reported.
All my ex's live in Texas (My ex's are all hyperscalers. And they are looking to relocate?)https://t.co/aEMM1tRumO
Bipartisan concern drives election outcomes
Exit polling suggests the issue resonated across party lines. In an NBC News national exit poll, 65 percent of Democrats and 39 percent of Republicans identified AI and data centers as a crucial or major factor in their decision, Mashable reported. More than half of all voters in the poll indicated that data centers and their influence on energy and water resources were significant concerns.
The backlash also manifested in specific legislative contests. In South Carolina, Dr. Annie Andrews defeated her Republican competitor, Mashable reported.
WAPO: “.. Voters in at least 29 jurisdictions across the country passed bans or restrictions on data centers Tuesday, reflecting the widespread public revulsion to the facilities ..”@washingtonpost https://t.co/UkAos9Xzpo pic.twitter.com/Vgk31X4XBx
As early as May 2025, the rising level of concern among the public was apparent, specifically when the One Big Beautiful Bill Act contained provisions that would prohibit states from regulating AI. Though some Republicans initially seemed determined to wave off voter sentiment about AI, the angst was clear, according to Mashable.
Local referendums target data center growth
Beyond state-level races, local voters used ballot measures to implement direct restrictions. In Oxford County, Maine, voters approved a 180-day moratorium on data center development and permitting
in their county 76% to 24%, Talking Points Memo reported. In Morgan, Illinois, 88 percent of voters approved a measure advising county officials to impose restrictions on building and operating data centers in the community.
In New Jersey, residents of Cumberland County rejected a ballot measure, Talking Points Memo reported.
Data from Redbud Consulting tracked 47 referendums in 44 municipalities in 12 states, including 21 in Ohio alone, NewsChannel20 reported. Redbud found that restrictions were approved in 44 of the 45 completed elections.
The sweeping Democratic victory in the US midterm elections could open up fresh opportunities for India's data centre industry, as growing opposition to large AI infrastructure projects in several American states prompts global technology companies to explore alternative…
Local leaders are facing increasing pressure as they manage zoning and development decisions. In Loudon County, Virginia, a community review was triggered for new or planned projects through special exceptions and public hearings. The Virginia legislature rejected a provision that would have allowed state agencies to circumvent local permitting or zoning requirements, The Intercept reported.
Market volatility and industry implications
The election results triggered immediate movement in the markets. On Wednesday, Trefis reported that AI data-center stocks fell, with CoreWeave closing down about 10%, IREN about 11% and Nebius about 7%. Power producers also saw declines, as Vistra and Constellation fell about 14% and 7%.
NEW: Voters deliver "AI earthquake," rebuking tech and billionaires -Voters backed efforts to slow data center development -AI safety advocates gained allies in Congress -New campaign tactics proved effective, offering a playbook for 2028https://t.co/TWzpEfz7Il
Other market shifts included a roughly 7 percent drop for Applied Digital, a 10 percent decline for Core Scientific, and a 4 percent fall for SpaceX.
Industry analysts suggest that while a total federal moratorium is unlikely due to potential presidential vetoes, state-level regulators may implement a slower, costlier approval process. This could involve raising the price of utility connections to slow construction without an outright ban, Trefis reported. Nomura noted that while much of the capacity expected to be operational by 2027 is already under construction, the real regulatory vulnerability lies in 2028, when a larger volume of projects remains subject to permitting uncertainty.
| Company/Entity | Reported Decline (Wednesday) |
|---|---|
| CoreWeave | ~10% |
| IREN | ~11% |
| Nebius | ~7% |
| Vistra | ~14% |
| Constellation | ~7% |
The scale of the industry remains massive; The Intercept cited a Forbes estimate that the total cost of the projected U.S. buildout ranges from $2.8 trillion by 2030 to $10.30 trillion by 2032. Hyperscalers including Amazon, Google, Meta, and Microsoft are currently on track to spend more than $720 billion on AI infrastructure this year, according to SF Standard.