Data center developers are adopting transparency and infrastructure-funding strategies to counter community opposition to new facilities.

Two years ago, massive AI data centers dominated the headlines. A year ago, murmurings of discontent emerged. By the final quarter of 2026, those murmurings have become fierce opposition. Communities complain about water consumption, power demands, and noise. Government bodies impose bans or moratoria. The pushback is unmistakable.

At Data Center World Power in Dallas (September 21–23), multiple sessions addressed this issue. Power availability and potential electricity rate hikes rank among the biggest concerns voiced by opponents. In some regions, data centers are blamed for rising electricity rates.

In response, developers are funding upgrades to support their projects. Some have paid for entire battery energy storage systems that benefit both the grid and their facilities. Others fund transmission upgrades or purchase transformers, substations, and power electronics to avoid passing costs to ratepayers. Grid planners and utilities are formalizing these arrangements as standard practice.

**Be Transparent Early: Retire the NDA Playbook**

Diane Sullivan, chief development officer at Hecate Energy, a Chicago-based utility-scale energy developer, attributes current backlash partly to past practices. Developers obtained permits with non-disclosure agreements with city officials, developing projects under the radar before announcing them publicly.

That approach worked for smaller projects with minimal local grid impact. AI data centers are now so large that transparency is essential and in developers' long-term interest. "In the past, developers would sometimes obtain permits before informing the public about a data center project, which is a terrible idea," Sullivan said. "We must become open and be fully transparent about our plans."

**Bring Power with You: Co-Develop Power with Utilities and EPCs**

Data center development requires parallel plans for the facility and its power supply—wind, solar, batteries, geothermal, natural gas, or nuclear. Permitting and system operator approval demand a clear plan for new power resources, typically funded by the developer.

Developers should partner with power plant developers, engineering, procurement, and construction contractors, and utilities to assemble options. Most projects involve multiple resources: solar, gas-fired generation, backup generators, and batteries. "Any project proposal should also include a power generation solution, or you are probably wasting your time," Sullivan said.

**Community Support Now Trumps Power Availability**

Proximity to a major metro area and fiber availability once defined ideal data center sites. Power became the key factor over the past couple of years. Now community support is essential. The project must benefit the local area and generate largely positive sentiment.

"You could have a perfectly executable project that's real, it's commercial, and has well-allocated risk, but the community shows up and doesn't want you there," said Dado Slezak, executive vice president of energy capital and strategy at QTS Data Centers.

Economic benefits must be tangible for residents. Beyond tax payments, developers support local schools or stabilize electricity rates. QTS reached an agreement with an Iowa utility to fix and subsidize community electricity rates for five years. Benefits extend beyond economics; some developers invest in water restoration.

"There are also different types of jobs that the data center brings," added Alise Porto, vice president of sustainability and strategic initiatives at Switch. Beyond direct data center roles, construction generates significant employment. Some developers translate those jobs into permanent positions via on-site retraining programs.

**Tour Working Facilities to Debunk Water and Noise Myths**

Developers attend community meetings with data on power draw, water consumption, and noise abatement. When opposition hardens, facts alone may not persuade. Slezak suggested touring a comparable facility can change minds. "I can tell them that you consume less water in a hyperscale campus than a restaurant would, but they often don't believe me. It is sometimes better to show them. I've toured groups through a facility and shown them our closed-loop system where there is no water consumption." Closed-loop designs significantly reduce process water usage compared to traditional evaporative systems.

**Target Pro-Data Center Regions like NELA and Texas**

Not every community opposes data centers. For every resistant area, another actively attracts them. Parts of Louisiana encourage development. "We are attracting plenty of interest from developers," said Rob Cleveland, president and CEO of Grow NELA (Northeast Louisiana Regional Economic Development Authority).

Attractive policies help. Grow NELA has cut permitting timelines to 15 days, compared with many states requiring over a year. Texas has also become attractive despite lengthening interconnection queues. ERCOT and the Governor's Office are implementing measures to ensure grid stability and protect ratepayers from cost pass-throughs.

**Exit Markets with Entrenched Opposition**

When opposition is vociferous and unrelenting, departure may be prudent. Some developers willing to meet demands on power, water, and noise still faced new objections. If a community truly opposes the project, finding a welcoming location is more productive. "There are a lot of communities that will welcome you," Slezak said.