Voters Dealt a Sweeping Blow to AI Data Center Expansion in the 2026 Midterms

In race after race on November 3, voters turned the AI data center boom into a liability — and the industry woke up Wednesday facing a fundamentally different political landscape. Democrats won full control of Congress and flipped governors' mansions in two of the country's most important data center states, Texas and Ohio, with candidates who made the rapid buildout of AI infrastructure a centerpiece of their campaigns.

Ballotpedia's analysis, supplemented by CNBC's own reporting, found that of 41 data center-related ballot measures spread across 10 states, voters came down against data centers in all but one — Harwood, North Dakota, where residents turned down a proposal that would have subjected industrial projects, including data centers, to additional review. Ohio alone accounted for more than half the measures, with 21 on the ballot.

The stakes could hardly be higher. In August, OpenAI said it had locked in 8 gigawatts of computing capacity at the PORTS-Pike Technology Campus in Ohio — a project SoftBank and SB Energy are developing with the U.S. Department of Energy, with Nvidia providing backing, that has been described as the world's largest planned AI data center campus and could carry a total price tag exceeding $500 billion. Ground is set to break on the first phase this year, with power expected to flow beginning in 2028. That timeline now faces serious political headwinds.

Ohio's governorship flipped blue as Democrat Amy Acton, a physician, defeated Republican businessman Vivek Ramaswamy. CNBC reports that Acton backs a "conditional moratorium" on data centers, under which the facilities would be required to shoulder the full cost of utilities and "exclusively build with union labor." Morgan Stanley analysts, as reported by TechCrunch, see Acton as a significant threat to Ohio's data center expansion plans. In a separate development, the Ohio county where Meta had intended to build a 700,000-square-foot facility voted to prohibit data centers entirely.

In Texas — on track to become the world's largest data center market by 2030, according to CNBC — Democrat Gina Hinojosa ousted incumbent Gov. Greg Abbott, having argued throughout the campaign that he had put the tech industry's interests ahead of local communities. Hinojosa supports a statewide moratorium on data centers. Goldman Sachs, according to TechCrunch, predicts data center construction delays in both Georgia and Texas because of Democratic gains.

The Senate race in Ohio also turned on the issue. Democrat Sherrod Brown ousted Republican Sen. Jon Husted after portraying the incumbent as, in CNBC's words, "the face of data centers."

Exit polling underscored the depth of public feeling. According to an NBC exit poll cited by TechCrunch, a majority of respondents think AI will cause more harm than good, close to 80% do not want data centers built near their homes, and nearly 60% identified data centers as a crucial or major factor in deciding their vote. A separate CNBC Voter Poll put that last figure at 56%, with Democrats ranking the issue higher than Republicans.

The results arrived despite record spending from Silicon Valley. A CNBC review of Federal Election Commission records found that 14 of the 20 largest donor groups directed their money almost entirely to Republicans, and that crypto, AI, and online gambling interests together contributed more than $377 million. Elon Musk, who gave more than any other individual donor this cycle, put in at least $474 million — with close to half of that going into Texas — and came away having lost both of the state's top races.

Data centers in space looking pretty appealing right now.— Elon Musk

Within hours of polls closing, Democratic lawmakers were calling for AI executives to testify under oath. Rep. Greg Casar of Texas, who chairs the Congressional Progressive Caucus, declared that the new House Democratic majority must treat it as "a top priority to protect Americans' jobs, freedom, and lives from AI billionaires," and charged that Republicans had been "bought and paid for by AI billionaires."

The revolt against data centers was one of the top issues of the 2026 election. And in a few years we will look back on it as just the early tremor of a much bigger AI earthquake upending American politics.— Rep. Greg Casar, Chair, Congressional Progressive Caucus

Lawyer up.— Rep. Robert Garcia, D-Calif., presumptive next chair of the House Oversight Committee

Democratic control of Congress improves the odds for legislation that would impose federal limits on the buildout. Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez put forward a bill earlier this year that, according to TechCrunch, would halt construction of new data centers nationwide until Congress establishes safeguards against higher electricity costs, environmental damage, and projects that move forward without community consent. A separate measure, the GRID Savings Act proposed by New Mexico Sen. Martin Heinrich, is designed to stop the costs of grid upgrades from being shifted onto communities when large AI data center projects are built nearby. Both bills would still face a possible veto from the Republican White House.

The backlash has been building from the ground up for months, fueled by specific grievances: data centers' heavy electricity and water demands, the use of gas turbines for power — as at xAI's facility in Memphis, Tennessee — and a permitting process that has often left communities in the dark. In Gilroy, California, Amazon erected a data center by meeting the requirements of a zoning law dating back 45 years, and TechCrunch reports that most residents had no idea it was underway. Local officials in some jurisdictions were required to sign nondisclosure agreements barring them from discussing data center projects.

National security matters. And so do the families in South Memphis breathing exhaust from the gas turbines powering an AI supercomputer.— Nadine Smith, President and CEO, Color of Change

Even before election day, AI-linked stocks were losing ground on Wall Street, with chipmakers, neoclouds, and other data center-dependent companies declining through October amid investor unease over rising interest rates and what CNBC described as overspending. Alphabet, Amazon, Microsoft, and Meta — the hyperscalers — are each committing hundreds of billions of dollars annually to AI infrastructure; CNBC reports that all four except Microsoft have slipped into negative cash flow as a result.

Regardless of federal action, I could imagine that we will see additional movement at the state and local level, given the momentum that's been building from the ground up.— Maia Woluchem, Program Director, Data & Society

Democrats ran on making Big Tech pay. Our job is to make sure they remember it once the cameras leave.— Nadine Smith, President and CEO, Color of Change

What comes next is uncertain but consequential. Likely near-term moves include more state-level construction moratoriums and requirements that data centers pay for their own power grid upgrades rather than passing those costs to surrounding communities, according to TechCrunch. Most projects already under construction are expected to continue, but the planned wave of capacity targeted for 2028 and beyond — including in Texas and Ohio — now faces a gauntlet of new regulatory and political risk.

Why it matters — The midterm results put hundreds of billions of dollars in planned AI infrastructure — and the pace of the entire US AI buildout — at risk of delays, moratoriums, and new federal oversight just as the industry was betting on rapid expansion through 2028 and beyond.

Reported by techcrunch.com, cnbc.com, axios.com, bloomberg.com