Proposals to halt the construction of new data centers across the United States are ill-advised and pose significant risks to economic prosperity, technological advancement, and national security, according to a Democratic state legislator.
David A. Reid, a Democrat representing parts of Loudoun County in the Virginia House of Delegates, argues that such moratoria, driven by public opposition to data centers, ignore the substantial benefits these facilities provide. These benefits include significant tax revenue that funds essential public services like police departments, roads, and schools, as well as hundreds of millions of dollars in annual wages for construction and permanent jobs.
"If Democrats want to regain the trust of the American people, we must have a defined vision for the future that brings prosperity to all – not just the ultra-rich – and we have to be for something not just saying, 'No,'" Reid stated. He advocates for a constructive approach that provides solutions rather than succumbing to what he describes as fearmongering.
Reid points to actions in New York, where Democratic Gov. Kathy Hochul imposed a statewide moratorium, and proposed national moratoria by figures like Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez. He argues these actions could cede the future of artificial intelligence to competitors like Beijing.
Concerns about electricity prices, water usage, and emissions from backup generators are often cited by data center opponents. Reid counters that aging power grids, geopolitical conflicts, and the ongoing war in Ukraine are more significant drivers of electricity costs than data centers. He notes that the industry is often willing to fund grid upgrades or supply its own power. Regarding water consumption, he contends that data centers use comparable amounts to large office buildings, with newer facilities employing water recycling systems.
Emissions from backup diesel generators, typically used for testing and maintenance only about 20 hours per year, are also a point of contention. Reid highlights that air quality in areas with a high concentration of data centers, such as Northern Virginia, has seen improvement.
Reid emphasizes the economic contributions of data centers, citing a PwC study that found the industry contributed $162.7 billion in taxes in 2023 alone. In Loudoun County, Virginia, data centers reportedly account for 38% of tax revenue while occupying only 2% of the land. He also notes the creation of well-paying union jobs, enabling workers to achieve financial stability and homeownership at earlier ages.
Instead of outright moratoria, Reid suggests the development of national or state-level Centers of Excellence to equip local authorities with the knowledge needed to make informed zoning and siting decisions. He believes that while local officials should listen to constituent concerns, decisions must be guided by facts as much as emotions.
In Virginia, Gov. Abigail Spanberger and state Democrats engaged data center developers to address concerns, leading to the passage of an energy consumption tax. This approach, Reid argues, demonstrates a willingness to find policy solutions that balance community needs with industry growth. He urges fellow Democrats to engage with data center representatives, consider their economic contributions, and allow local authorities to make determinations on data center placements.