Texas, Georgia and Ohio hold over 40% of planned data-center capacity
At an election-night gathering at the San Francisco Opera House hosted by Nvidia CEO Jensen Huang, executives in tuxedos watched “The Marriage of Figaro” and discussed election returns as a threat to the massive build-out of computing capacity their industry depends on, according to people in attendance. By Wednesday morning, senior OpenAI leaders were discussing whether the results meant the company would have to reset expectations for next year’s data center capacity, according to a person familiar with the conversation.
U.S. voters backed Democratic candidates in Ohio, Michigan, Texas and Georgia who had criticized data center construction and pledged to slow or pause rollouts. More than a dozen Ohio towns voted to halt or restrict new development, and similar bans passed in towns in Kansas, Florida and California. Some data center-related ballot measures were still upcoming, but the near-universal rejection across dozens of measures signaled growing bipartisan opposition, though elected Democrats offered few concrete details beyond pledges ranging from outright bans to greater scrutiny.
Texas, Georgia and Ohio account for more than 40% of all planned U.S. data center capacity, according to investment bank Evercore ISI. OpenAI’s Stargate is under construction in Texas, and the company is planning another massive data center effort called Project Camellia in Georgia. Meta is building a large data center in Texas and another dubbed Prometheus in Ohio. Texas Governor-elect Gina Hinojosa lamented during her campaign that the state had become a “wild west” for data center development. “It stops when I’m governor,” the Democrat said. She called for a pause until the state legislature could pass new regulations.
Tech companies were already struggling to secure enough computing power for growing demand, and a stall in construction could turn an already fragile situation dire. Anthropic, which has signaled it could spend up to $895.4 billion on computing power in coming years, warned investors in a securities filing last month of the risk of having “significant compute” in the U.S. and said moratoriums could delay or prevent facilities it needs. Slowing the rapid growth of the properties that house the hardware for AI systems could upend one of the main drivers of U.S. economic growth. A large number of projects already approved for construction will continue, but some future projects, including some well into planning, could be scrapped or at least delayed.
Several Democrats who won Senate races — James Talarico of Texas, Abdul El-Sayed of Michigan and Annie Andrews of South Carolina — attacked Republican opponents for supporting data centers and proposed new federal restrictions. A political-action committee advocating data center restrictions said it reached voters with an ad attacking David Sacks, a venture capitalist and White House AI adviser opposed to regulation. The ad portrayed Sacks as getting rich from AI investments while blocking rules in his role advising the president.
Rep. Greg Casar, a progressive Texas Democrat who was re-elected and supports a nationwide moratorium on new data centers, said the revolt against data centers was one of the top issues of the 2026 election. He said he believes the anti-AI sentiment will define future elections. “In a few years we will look back on it as just the early tremor of a much bigger AI earthquake upending American politics,” he said. About 56% of voters nationally said data centers were a crucial or major factor in their picks for Congress, according to a national survey conducted by the polling firm SSRS.
The vote came against a backdrop of growing voter concern about AI over issues ranging from hacking and job losses to data centers’ strain on local power and water systems. In Alaska, Democratic Senate candidate Mary Peltola was leading incumbent Republican Sen. Dan Sullivan late Wednesday. Peltola had criticized Sullivan’s eagerness to court AI firms. Wendi Deschamps, a Peltola voter and environmental scientist in Girdwood, a small town surrounded by seven glaciers about 45 minutes from Anchorage, said, “I just tried to vote anti-data center for every single candidate.”
Industry spending also shaped the election. SpaceX CEO Elon Musk poured nearly $500 million into the midterms, while others in the sector donated tens of millions of dollars to help elect candidates more open to data center development. Musk, who lives in Texas and whose company is based there, wrote on X early Wednesday: “Data centers in space looking pretty appealing right now.” He referred to his idea of locating the facilities in orbit to avoid challenges building them on Earth.
Goldman Sachs projected AI investment would account for 1.9% of U.S. gross domestic product this year, the biggest share of economic growth for the build-out of a new industry since the railroad boom in the 19th century. LinkedIn estimated 750,000 new U.S. jobs from 2023 through September were tied to AI. The data center build-out has buoyed economic growth while overall hiring slowed and other sectors stagnated, flooding many rural communities with investment and property-tax revenue.
Tech companies have paid for new fire houses. In Richland Parish, La., tax revenue linked to Meta paid for $50,000 bonuses for public school teachers. Cedar Rapids, Iowa, Mayor Tiffany O’Donnell said at the WSJ Tech conference on Tuesday that two data centers under construction had been a boon to her city, attracting $8 billion in capital investments and tens of millions of dollars in community benefits. The projects also created political costs: O’Donnell said her family and dog were threatened by a resident angry about the data centers, and detractors gave her the nickname “Tiffany O’Data Center.”
In Sunbury, Ohio, 35-year-old teacher Matt Sforza said on Tuesday that he planned to vote for a local ban on large data centers because he worried about damage to the local water supply and other environmental hazards. “I think we kind of need them, just to keep up with the demands of all the things they do,” said Sforza, a former Republican voter who said he had swung Democratic in recent years. But it “feels like there might be a better way to do it than putting it right next to schools and people’s houses,” he said. The Sunbury ban passed in a landslide.
The largest data center building sites employ thousands of construction workers for years, though the facilities employ far fewer people after opening. A decline in new data centers would likely slow construction employment as apartment and office construction contracts. Anirban Basu, chief economist of the Associated Builders and Contractors, a construction trade group, said, “Data centers have been the primary driver of construction spending growth.” He added: “One can imagine that the data center construction boom is going to really soften over the next couple of years.”
Sequoia Capital partner Pat Grady said at the WSJ Tech conference Wednesday that the election would lengthen project timelines. “This is going to probably elongate the timelines for the data-center build-outs,” Grady said. “That’s probably the most tangible impact of what happened with the elections yesterday.” Investors had sold bonds tied to CoreWeave and other data center companies in recent weeks over concern about higher interest rates and their debt levels. Many in the tech industry had also been bracing for data-center activity to slow down because of bipartisan backlash. On Wednesday, CoreWeave shares fell nearly 10% and Applied Digital fell almost 7%, extending a volatile stretch for the sector.
Brad Gerstner, a venture capitalist who invests in AI companies, estimated 25% to 35% of next year’s U.S. data center build-out could be at risk. On the “All-In” tech podcast late Tuesday, he said, “Now with this blue wave I think it’ll slow down even more.” “That’s why I think it will be really challenging for the AI infra trade,” he said, referring to shares of data-center companies. A large number of projects already approved for construction will continue to provide near-term investment, but some projects still in planning could be scrapped or at least delayed.