Maine Bans AI Data Centers Over Concerns About Impact on Household Energy Costs

Maine lawmakers have approved the country’s first statewide moratorium on large-scale data centers, reflecting mounting concern over the energy demands of facilities that support the expansion of artificial intelligence.

The legislation that passed this week halts the development of new data centers requiring more than 20 megawatts of electricity until fall 2027, while also creating a framework to evaluate their effects on the power grid.

The 18-month moratorium cleared final approval in both chambers of the state Legislature and now heads to Gov. Janet Mills for her signature.

Gov. Mills has indicated she would like an exemption for a $550 million data center proposed at the site of a former paper mill, but lawmakers previously turned down an amendment that would have allowed it.

This backlash is unfolding as the Trump administration urges individual states to avoid regulating AI, to ensure the United States remains competitive with other countries in the quickly evolving field.

“We remain in the earliest days of this technological revolution and are in a race with adversaries for supremacy within it,” an executive order signed by President Donald Trump in December said. “To win, United States AI companies must be free to innovate without cumbersome regulation. But excessive State regulation thwarts this imperative.”

What are data centers?

Data centers are facilities designed to store, process, and manage large amounts of digital information used to train, run, and scale artificial intelligence systems.

They contain servers and networking equipment, supported by power and cooling systems that maintain proper operating temperatures.

Currently, there are more than 4,000 data centers throughout the country, with Virginia and Texas leading the way with at least 600 and 444 data centers, respectively.

Other states where many data centers are being built include California, Illinois, and Arizona.

Wyoming is also on track to become a major AI hub after Laramie County commissioners unanimously approved plans for a 1.8-gigawatt data center that could expand to 10 gigawatts, making it the largest AI campus in the nation.

Data center debate

Data centers can provide economic and financial benefits to a community, such as increased tax revenue, temporary construction employment, and the possibility of drawing additional businesses or investment. These projects often require improvements to infrastructure like broadband, electrical systems, and roadways, which may offer long-term advantages for local residents and businesses.

But it's also spurred debate over the data centers bringing increased noise for nearby residents, possible decreased property values, and high resource consumption, including water use and electricity strain.

In Newton County, GA, Meta’s $750 million data center guzzles about 500,000 gallons of water a day, roughly 10% of the county’s entire supply, The New York Times reports.

That’s left some residents living with taps that spit out brown sediment.

Aaron Wright, CEO of Solomon Group and Solomon e3, a climate tech company focused on equitable energy solutions for underserved communities, tells Realtor.com®, "As utilities race to meet AI-driven energy demand, infrastructure costs are rising and those costs are passed [on] to everyday ratepayers."

The state that delivers the most electricity to data centers, Virginia, saw a 3.1% increase in electricity prices from May 2024 to May 2025, according to the U.S. Energy Information Administration.

The other four states that deliver the most electricity to data centers are Texas, with electricity rates up 4.4%; California, up 1.9%; Illinois, up 12.2%; and Oregon, up 5.5%.

Tech firms vow to cover power costs

But Amazon said it's already ensuring that taxpayers aren't footing the bill for a new data center coming to Louisiana.

Amazon said it's working with the local utility, Southwestern Electric Power Company (SWEPCO), to make sure the tech company pays 100% of the costs associated with the new data center campus in Louisiana.

This includes covering all expenses for new energy infrastructure and upgrades required to serve the data centers, moves that are expected to strengthen overall grid reliability for all SWEPCO customers.

Microsoft has also pledged to put the community first anywhere it plans to build a data center. The company has a "5-point plan" that is part of its Community-First AI Infrastructure initiative. The main promise Microsoft is making is to "pay our way to ensure our data centers don't increase your electricity prices."

Microsoft said it would do this by asking utilities and public commissions to set their rates "high enough to cover the electricity costs" for their data centers. This includes the costs of adding and using the electricity infrastructure needed for the data centers they're building and operating.

In February, President Trump said he has negotiated a new ratepayer protection pledge.

"We’re telling the major tech companies that they have the obligation to provide for their own power needs," Trump said. "They can build their own power plants as part of their factory, so that no one’s prices will go up and in many cases, prices of electricity will go down for the community, and very substantially then."