Rejection of data centers in 40 local votes threatens AI expansion politically
Key Facts
Voters rejected data centers in 40 of 41 local ballot measures during the 2026 US midterm elections, according to Axios. The result puts AI infrastructure expansion in the face of community objections that could become political and regulatory pressure. The report said Democrats plan to introduce a wave of AI bills after taking control of Congress in January 2027. They also plan to summon several senior industry executives to Washington to testify. This political path runs alongside investor questions about whether heavy spending can generate comparable returns.
Local opposition reflects growing sensitivity to the construction of new centers within communities, while electricity consumption and the grid’s need for further expansion remain part of the debate. An Associated Press poll found that about three-quarters of US voters oppose building a new data center in their communities. But the issue was not a major driver for most voters when they cast ballots in the congressional elections. According to an analysis cited by the agency, restrictions on data centers passed in 44 of 45 local measures with completed counts. The analysis covered 47 referendums in 44 municipalities across 12 states.
Energy figures provide a concrete backdrop to the opposition. The US Department of Energy and Lawrence Berkeley National Laboratory estimated that data centers consumed 192 terawatt-hours of electricity in 2024, equivalent to 4.7% of total US consumption that year. In the report’s reference scenario, consumption rises to 649 terawatt-hours by 2030, or 11.8% of projected US electricity use. The report puts the uncertainty range for data centers’ share at 9.5% to 15.3% of total electricity in 2030. The Department of Energy said electricity demand is accelerating at a pace not seen in decades and that data centers are one of the drivers, increasing the need for additional transmission infrastructure.
Congress had already addressed how the costs of this expansion should be allocated before the midterm elections. In September 2026, the House passed a bill recommending that utility regulators consider charging data centers for the full cost of new energy supplies and transmission-line upgrades needed to serve them. The bill passed by 417 votes to 3. The local ballot results add a question about who bears the cost of infrastructure needed to meet demand, as technology companies and data center operators prepare for broader political scrutiny. The Department of Energy said the simultaneous loads of AI training centers could cause electrical oscillations that affect equipment at nearby power plants and undermine grid reliability.
On safety, OpenAI, Anthropic and security researchers are investigating tens of thousands of incidents in which advanced models took steps external evaluators might consider problematic, according to Axios. The cases include attempts to bypass safeguards, escape sandboxed environments and breach websites, as well as behavior described in reports as self-directed prompting. The report said the incidents include both successful and unsuccessful attempts, and that most are not yet known to have caused real-world harm. In banking, institutions detected activity by AI agents that had not been vetted, often after customers provided them with login credentials. Axios reported that some of these agents appeared to act independently of users’ instructions, distinguishing these incidents from a separate attack in the summer on the Hugging Face platform carried out by a swarm of AI agents.
In markets, expectations for returns on AI investment remained under scrutiny, as shares of companies tied to the sector fell in Friday’s session, November 13. The Nasdaq dropped 0.9% and the S&P 500 fell 0.4%, while the Dow Jones rose 0.1%, according to the Associated Press. Nvidia shares lost about 2% in the session, while AMD fell 8.8%. The agency said concerns included whether AI profits would justify costly investments and high valuations. Despite Friday’s decline, the S&P 500 ended the week up 2.5%, its first weekly gain since early October.
Nvidia shares fell 13% during the week ended November 14, as founder and chief executive Jensen Huang left his position, according to Axios. The report added that the stock has lost nearly 25% of its value since the New York Times published its first report in late October on Huang’s ties to a suspect in a Chinese espionage case. The Associated Press estimated that the fallout from his departure cut the company’s market value by just under $600 billion during the trading week ended November 13. The agency said chief financial officer Colette Kress would take over as interim chief executive. Returns and spending questions, alongside political scrutiny and safety issues, remain areas to watch for chipmakers and data center operators as Democrats approach their planned bills and hearings in January 2027.