At least 14 US states are evaluating data-center moratoriums or new permitting constraints in response to power grid and water concerns.
Governments on both sides of the Atlantic are pausing, auditing, or rewriting rules for hyperscale data centre development as local opposition to power and water demand hardens into formal policy. Moody's Ratings has warned that at least 14 US states are considering statewide moratoriums in 2026, cautioning that the pace of data centre expansion is straining electricity and water infrastructure to a degree that raises credit risk for host state and local governments. North America absorbed a record 25GW of data centre capacity in the first half of 2026, according to JLL—double the volume of a year earlier.
New York became the first US state to act when Governor Kathy Hochul signed an executive order in July pausing state environmental permits for new data centres of 50MW or more for up to a year. The order cited nearly 12GW of data centre load requests sitting in the New York Independent System Operator's interconnection queue as of May, with more than eight gigawatts of that arriving in 2025 alone. An analysis of the 50MW threshold found that colocation and enterprise operators would remain largely untouched.
Pennsylvania followed in August when Governor Josh Shapiro signed an executive order requiring data centres above 25MW to secure local approval before the state would consider a permit, alongside mandates that they cover their own power and transmission costs. Shapiro, who previously championed the sector, stated he would "not allow Pennsylvanians to be bullied by greedy developers."
Texas took a different approach. Rather than imposing a moratorium, Governor Greg Abbott ordered the Electric Reliability Council of Texas (ERCOT) and the Public Utility Commission of Texas to audit every data centre project advancing through the grid's interconnection process after requests reached 474GW—more than five times the state's record peak demand. The scope has since narrowed to between 250 and 300 projects representing around 200GW, but no project can proceed until the review concludes.
Scotland's parliament votes this week on a Scottish Greens motion to pause all hyperscale data centre applications until the government publishes a national strategy. The party warns that the 24 outstanding applications before Scottish planning authorities would, if approved, draw around 1.5 times as much electricity as the whole country currently uses at peak times.
In Finland, opposition parties are calling for a national permitting system after Google confirmed a €13 billion investment in the country's digital infrastructure—its largest single commitment in Europe to date—warning that no coordinated oversight of the resulting power demand currently exists. Ireland presents a contrasting case: its energy regulator imposed an effective halt on new data centre grid connections in the Dublin area in 2021, but lifted it in December 2025, allowing new connections provided operators meet at least 80 per cent of their energy demand from renewable sources annually. Data centres accounted for 23 per cent of Ireland's total electricity consumption in 2025, up from 21 per cent the year before, suggesting that even infrastructure pauses do not resolve underlying demand.
The financing side is beginning to reflect this pattern. Senior bankers have told Reuters they are now weighing community sentiment alongside credit quality when assessing data centre loans, following a series of project withdrawals including Amazon Web Services pulling its application in Calvert County, Maryland, and QTS abandoning its $30 billion Digital Gateway project in Prince William County, Virginia. Data Center Watch estimates that at least 75 major projects representing more than $130 billion in investment were delayed or cancelled in the first quarter of 2026 alone, with organised local opposition cited as a contributing factor.
What distinguishes the current wave from earlier local zoning disputes is its level of governance: state governors, national parliaments, and grid operators are now writing the rules directly rather than leaving the issue to individual counties. Texas, long the sector's most permissive market, freezing its own approvals pending an audit sends a different signal to lenders than a single county vote does. The pattern suggests that pauses alone may not resolve the underlying tension between data centre demand and infrastructure strain.