US midterm results threaten data center boom as AI backlash grows

Opposition to data centre development emerged as a major winner in the US midterm elections, raising concerns among investors about tighter regulations and a potential slowdown in the artificial intelligence boom that has supported economic growth and stock market gains, Reuters reported.

Democratic candidates who campaigned on restricting data centre construction won gubernatorial races in Texas and Georgia, ending decades of Republican control in both states.

Reuters reported that the victories have strengthened opposition to data centers, which face growing criticism over their high electricity and water consumption, environmental impact and limited local employment benefits.