Why experts predict midterm election results could slow data center buildout in some areas
Public opposition meets election results
Data centers are expanding rapidly across the United States to support artificial intelligence, prompting widespread public backlash. A CBS News poll conducted this summer found that opposition to building a new facility nearby outpaced support by more than two to one.
Franklin Templeton chief market strategist Stephen Dover said the election results could bring a slowdown in construction, along with new regulations and added costs for developers. The article links those possible changes to victories by Democrats, without specifying how broadly they might affect projects.
Texas proposals could affect projects
Investor Ives identified Texas as a state to watch, saying it represents 25% to 30% of data center capacity expected to come online by 2030. Democrat Gina Hinojosa defeated Republican incumbent Greg Abbott in the governor’s race and proposed a temporary construction ban during her campaign.
Gordon Johnson, CEO and founder of GLJ Research, said Hinojosa’s win could stall 13 gigawatts of planned data-center power in Texas. Johnson told CBS News that Abbott had already established a moratorium and said the new governor could keep permits frozen without passing another law.
Another pause and economic outlook
Bottoms, who campaigned on pausing new data center construction, said on CBS Mornings that she would sign an executive order and review what further administrative steps were needed. She also said officials would need to examine existing agreements and possible remedies, and noted that many local governments had already acted. The account does not identify Bottoms’s state, leaving unclear how this example relates to the Texas discussion.
Data center and AI investment has helped support U.S. economic growth and stock market gains. Dover and economists cited in the report said construction pauses could delay projects, but would not eliminate AI capital spending or switch off its contribution to growth.
Key points
- Analysts say Democratic victories could slow data center construction in some parts of the country.
- A CBS News poll found more than twice as many Americans opposed a nearby new data center as favored one.
- Gordon Johnson said Hinojosa’s Texas victory could put 13 gigawatts of planned data-center power at risk.
- Economists say pauses may delay construction without stopping AI investment or its support for growth.