Maine was supposed to be the test case. The state legislature passed a bill that would have made it the first in America to freeze approvals for large data centers requiring more than 20 megawatts of power. The moratorium would have held until October 2027 while a state council studied the impact on the electrical grid, energy bills, air, and water.

On Friday, Democratic Governor Janet Mills vetoed it.

The reason: a single $550 million data center project in the town of Jay, Maine, that would reuse the site of an Androscoggin paper mill that shut down after a boiler explosion in 2023. The closure killed hundreds of jobs. The data center promises 800 construction jobs, 100 permanent positions, and significant property tax revenue. Mills said she would have signed the bill if it had included an exemption for Jay.

"A moratorium is appropriate given the impacts of massive data centers in other states on the environment and on electricity rates," Mills said. Then she killed the moratorium anyway.

The National Battle Lines

Maine is not an isolated case. More than a dozen US states are now weighing legislation to halt or constrain data center development. Virginia, one of the world's largest data center hubs, is among them. Between May 2024 and June 2025, at least 36 US data center projects were delayed or blocked, disrupting an estimated $162 billion in investment, according to Data Center Watch.

At the federal level, Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez have introduced the Artificial Intelligence Data Center Moratorium Act, which would halt all new data center construction until Congress passes AI safety legislation. The bill calls for protections covering environmental impact, energy consumption, labor, and civil liberties before additional capacity is built.

The data center moratorium is already becoming a fault line in Democratic primaries. Politico reported that congressional candidates are taking positions on the Sanders-AOC bill. Meanwhile, the Trump administration is pressuring states to stay out of AI regulation entirely.

The Numbers Behind the Backlash

US tech giants have pledged to spend more than $600 billion on AI data centers this year. That figure is considered the largest infrastructure buildout since the telecom boom of the late 1990s. But the boom is colliding with local reality.

Communities are fighting back over electricity consumption, water usage, noise, and rising household energy bills. Public sentiment in some regions runs at a roughly 6:1 negative ratio against data center development, according to Pado AI CEO Wannie Park. Microsoft's proposed facility in Caledonia, Wisconsin was halted entirely by local opposition, prompting the company to launch a "Community-First AI Plan" with pledges on electricity pricing, grid upgrades, water stewardship, and tax payments.

Industry leaders are pivoting to self-sufficiency models: behind-the-meter power generation, small modular nuclear reactors, and even offshore floating data centers to bypass grid constraints. A third of hyperscalers and colocation providers plan to build fully self-powered campuses by 2030, according to a Bloom Energy report.

The Honeymoon Phase Is Over

Mills' veto does not mean Maine is open for business. She signed a separate bill prohibiting data centers from accessing state business development tax incentives, and plans to issue an executive order establishing a council to examine data center impact in the state.

Democratic state representative Melanie Sachs, who sponsored the moratorium bill, called the veto "simply wrong." She warned it "poses significant potential consequences for all ratepayers, our electric grid, our environment and our shared energy future."

The pattern is now clear: AI infrastructure spending is accelerating into a wall of local resistance. The North American map is bifurcating between pro-growth federal zones and states asserting oversight through zoning, water-use ordinances, and energy regulation. Maine's veto killed one moratorium. It may have accelerated a dozen others.

First reported by The Guardian. Additional reporting from Reuters, Data Center Knowledge, and Politico.