Rising AI Use Fuels Data Center Boom—and Puts Congress on the Clock

• Congress faces bipartisan pressure to ensure data center growth does not increase residential energy costs.
• Data centers are major new energy consumers, with natural gas usage projected to triple by 2030.
• Legislative momentum is accelerating at both federal and state levels, with proposals requiring operators to fund their own power infrastructure.
• Community opposition is shaping policy, with concerns over water use, land impact, and limited job creation.
• Developers must engage in the political arena, not just the commercial one, requiring early stakeholder engagement, monitoring, and coalition building.

America has a robust appetite for Artificial Intelligence. Nearly 90 percent of U.S. companies reported using AI for some function in 2025, according to a recent McKinsey report. That’s up from a little over half in 2023.  Millions of Americas also have made this transformative technology a cornerstone of their daily lives.

But the data centers AI companies say are needed to power the algorithm economy are far less popular. 

Data centers—large-scale facilities that power AI, cloud computing, and digital infrastructure—are rapidly becoming one of the largest new sources of electricity demand in the United States. Data centers are expected to triple their natural gas usage by 2030, reaching 4.5 percent of the nation’s gas consumption. 

Data centers’ impact on the electrical grid varies greatly on a regional basis. In some states, data centers only use a small percentage of available power. But in Virginia, for example, data centers accounted for 26 percent of all electrical consumption in 2023.

This has created a fiercely competitive seller’s market, as reported in Womble Bond Dickinson’s 2026 Energy Outlook, with data center projects snapping up available energy at a faster rate than can be produced. 

In late March, the Trump Administration recently released its National Policy Framework on Artificial Intelligence. The policy document generally takes a pro-AI/pro-data center stance, although it states, “Congress should ensure that residential ratepayers do not experience increased electricity costs as a result of new AI data center construction and operation.”

When the framework was introduced, many Republican leaders lined up behind the Administration in support of the plan. But in just a few weeks, the popular tide has turned sharply against data center development making even reliably pro-business lawmakers take a step back to reconsider the shifting landscape of public opinion.

As scrutiny intensifies, stakeholders are beginning to apply established policy and advocacy playbooks used in other large-scale infrastructure sectors. This includes coordinated engagement through trade associations, proactive legislative drafting, and alignment with state-level policy efforts—approaches that may become increasingly relevant as the regulatory environment evolves.

Shifting Perspectives on Data Centers

The Administration has put Congressional leaders on the clock: They are expected to deliver a plan that enables data center development while protecting American consumers from higher power bills. Such a request builds on the Administration’s “ratepayer protection pledge”—a voluntary agreement signed by some of the largest companies in the tech sector. The companies agreed to pay for or build their own energy sources for data centers, although energy sector insiders say there are unanswered questions as to exactly how that will happen.

However, securing that support looks increasingly difficult. A growing consensus has developed, among Democrats and Republicans alike, that many constituents are uneasy about data center development and its potential impact on communities. Issues lawmakers have expressed as potential concerns include:

• Higher energy costs for residential consumers;
• Grid reliability and transmission constraints;
• Water usage and local supply impacts;
• Noise, land use, and community disruption; and
• Limited long-term job creation by data center projects.

An April 29 hearing of the House Energy and Commerce Subcommittee on Energy highlighted a growing bipartisan chorus that data center growth must not drive up costs for residential electricity customers. Lawmakers and witnesses agreed that large-load users like data centers should fully fund the infrastructure needed to serve them, and that ratepayers should be protected from rising electricity prices. 

The subcommittee also emphasized expanding transmission, modernizing the grid, improving permitting, and strengthening load forecasting to manage rapid demand growth.

Committee members also talked about water usage as a key issue raised by constituents. Data centers that greatly reduce water consumption (through closed loop cooling, for example) will be better positioned to gain community support and regulatory approval.

Beyond big-picture issues such as energy pricing, climate impact, and grid reliability, congressional members also are increasingly responding to constituent concerns raised at the local level. 

Community opposition, often expressed at town halls and in local permitting processes, is emerging as a critical driver of federal attention, particularly as lawmakers weigh re-election considerations alongside infrastructure priorities. Notably, even projects powered by clean or self-generated energy sources may still face resistance where these localized concerns are not addressed.

Many Congressional leaders also have signaled support for maintaining state and local control over energy policy rather than imposing a one-size-fits-all federal approach. Officials cited vast differences between state regulatory schemes, electricity grids, resource availability, and other variables.

Key Federal and State Data Center Legislation

Several House Democrats have introduced bills aimed at addressing the energy and environmental impacts of data centers. 

One measure, H.R. 6529 from Reps. Greg Landsman (D-Ohio) and Don Beyer (D-Va.), would require the Federal Energy Regulatory Commission (FERC) to convene operators and issue a report on protecting ratepayers. Landsman also introduced the “No Harm Data Centers Act” (H.R. 8033), which would mandate studies of data centers’ environmental effects and expand FERC’s authority over rate-setting. 

In addition, the “Energy Bills Relief Act” (H.R. 7977), introduced by Reps. Sean Casten (D-Ill.) and Mike Levin (D-Calif.), includes provisions to ensure data centers bear the cost of their energy use.

In the Senate, several high-profile data center bills are pending before the Energy and Natural Resources Committee, with Ranking Member Martin Heinrich (D-N.M.) signaling interest in marking up proposals and noting alignment with Chair Mike Lee (R-Utah). 

A bipartisan measure from Sens. Josh Hawley (R-Mo.) and Richard Blumenthal (D-Conn.)—the “Guaranteeing Rate Insulation from Data Centers (GRID) Act”—would require new data centers to operate on independent power sources and mandate existing facilities transition off the grid within 10 years. Hawley has argued that Congress should codify protections to ensure data center operators pay their own energy costs. Blumenthal, meanwhile, has rejected the White House’s new AI framework, calling it inadequate and vowing that Senate Democrats will block it.

A number of other proposed energy infrastructure bills also would either directly or indirectly address the growing role of data centers as energy consumers.

Federal officials also face growing pressure from states, several of which have introduced their own legislation to regulate the data center industry, again largely in response to public concerns.

For example, Florida recently passed a new, first-in-the-nation law placing stricter new requirements for data center development. The new law mandates that data center projects must fully cover the costs of their energy consumption and not pass on higher prices to consumers. The law also protects the rights of local governments in the state to reject data center projects and allows Florida’s water management districts to deny permits if a data center development would threaten the local water supply. 

Moving forward, lawmakers on both sides of the aisle face a difficult tightrope to walk: Meet the public’s growing demands for AI service, while limiting the impact of data centers on communities. Can they agree on a path forward that meets this tricky balance? That is something that remains to be seen. 

What Developers Should Do Now

Data center development is no longer a pure business decision. It is now political as well, and if developers aren’t engaging with Congress and their communities—or at least tracking developments—then they are exposed to political risk that might not be well understood.

Developers, investors, and companies reliant on digital infrastructure should consider:

• Engaging early with local communities and elected officials to address concerns related to water use, land impact, and economic benefits;
• Evaluating energy sourcing and cost structures in light of potential legislative requirements to internalize infrastructure costs;
• Monitoring federal and state legislative developments that could affect project timelines, permitting, and operational models; and
• Aligning with industry groups and policy coalitions to help shape emerging regulatory frameworks.

This is not the first time private-public partnerships have had to navigate controversial or sensitive infrastructure projects. Organizations that address these factors up front will be better positioned to navigate an increasingly complex and politically sensitive landscape, while those that do not may face delays, increased costs, or project uncertainty.