The Fences Were There for a Reason

The Heat

Artificial intelligence is in the dock for boiling the planet. The numbers behind the charge are real. United States data centers used about 176 terawatt hours of electricity in 2023, roughly 4.4 percent of everything the country generated. The projection for 2028 runs between 6.7 and 12 percent. They drank about 17.4 billion gallons of water directly in 2023, with a projection of 38 to 73 billion by 2028, and roughly 211 billion more went out indirectly through the power plants that feed them. In The Dalles, Oregon, Google’s water use grew 316 percent while the town’s grew 12. In Virginia, more than one kilowatt hour in every four now goes to a data center. Two thirds of the new hyperscale campuses built since 2022 sit in regions already short of water.

I am not going to minimize any of that. I spent my working life in technology, part of it planning and building data centers, and the bill on the table is real. But notice one small thing before we move on. You know these numbers because Congress ordered somebody to count. The study everyone quotes is a congressionally mandated report from Lawrence Berkeley National Laboratory, the third in a series that started in 2007. The measuring stick is itself a fence. Somebody built it on purpose.

The Fences

Data center planning starts years ahead of breaking ground.

Before a buyer of data center space ever shows up, the ground has been decided. States and counties zone land for data centers because they want the lease money, and they pick the places that make sense: safe from tornadoes, floods and fault lines, with diverse power supply and water to spare. As a client you do not do that zoning. The state does, deliberately, for revenue. The big Azure and AWS sites sit where they sit because state planning moved alongside the hyperscalers’ demand. The first fence was standing before anyone knocked.

Then you arrive at the table, and you prove things. You prove you have the financing. You prove you can build to a tier rating, one, two or three, a published discipline of standards that data center builders adhere to. You prove your process will stay auditable the whole way through. And you prove you can pay for the disruption you cause, because if you have to dig up ground to run more fiber or pull more power from the local grid, the community does not carry that cost. You do.

And then there is the room where the community can simply kill it. Standing committees sit inside these towns, open to anyone, and they are the first place a project can die. If the build disrupts housing or nearby services and enough people turn up to say no, you can be denied right there.

I know because it happened to me. We were building a secondary data center in Tornado Alley, and the town had only one fiber provider, with satellite and cellular as the backup. That is not true resilience, so we needed to run more fiber in. The planning commission said no. We had come a long way through the process, and the no meant walking away and choosing another site. Financing in hand, standards met, and a room of local officials still turned us down. The system was working.

Above those local rooms sat a federal layer, built piece by piece across twenty years. In 2006 Congress passed a law, signed by President Bush, ordering the EPA to study data center energy use. That is where the counting began. In 2010 the Obama administration launched a consolidation program that forced federal agencies to inventory every data center they ran and shut the wasteful ones. In 2014 Congress wrote it into law, through a Republican House, with annual inventories, consolidation plans and published savings. In 2016 came hard optimization targets, including power efficiency metrics. Thousands of federal data centers closed under those programs, tracked publicly by the Government Accountability Office. Fence building used to be everyone’s job.

And it worked, once, measurably. From 2014 to 2016, total United States data center power held nearly flat at around 60 terawatt hours while cloud workloads exploded, because efficiency and consolidation absorbed the growth. Read that again. The demand curve went vertical and the power curve barely moved. That is what fences plus good engineering can do.

The last piece went up in January 2025: an order opening federal land for gigawatt scale AI data centers, but with strings attached. Clean power to serve the sites. Labor standards. Security plans. American made chips. Developers carrying the costs. A companion memo required agencies to monitor data center electricity and get certified assessments of energy and water use. You can argue with any single string. But they were strings, and they were tied on purpose.

The Arson and the Misdirection

The current administration is stripping away or blatantly ignoring that governance, and it was put there for a reason. Many law abiding citizens who care about corruption and about managing things properly spent years putting up these very fences.

The receipts are short and public. On day one, one order revoked dozens of prior actions, including the 2023 AI safety order, and a second declared a national energy emergency directing agencies to use emergency permitting. In February 2025 the Council on Environmental Quality removed the rulebook agencies had used for environmental review for decades. And in July 2025 a single order did the rest: it revoked the strings attached order outright, defined any data center over 100 megawatts as a qualifying project, created new exclusions so those projects can skip full environmental review, put them on fast track permitting, streamlined the Clean Water Act and Clean Air Act touchpoints, opened federal land, and told the Commerce Department to hand out loans, grants and tax incentives. The White House fact sheet described the revoked order as having saddled development with climate requirements. As if that were the insult.

Even the Democrats’ acceleration order came with strings. The replacement kept the acceleration and cut the strings.

To be fair once and briefly: not every fence was lowered from the White House. Two court decisions trimmed environmental review on their own in 2024 and 2025. But the orders above carry dates and signatures, and the direction of travel is not ambiguous.

That planning commission in Tornado Alley that told us no was not an enemy of progress. It was the system doing its job, and we complied, because there was a process and the process had teeth. Strip the teeth and the no never comes. The site gets built wherever the money points.

And now, when the fences are burned down or stepped over, watch where the anger goes. We blame the tool. We get hot and bothered about power and water, and we demand somebody invent the very protections we just tore down. The chip did not zone the land. The model did not veto the review. Humans built the fences and humans burned them, and the anger is being pointed at the tool instead of the fire. It’s almost like no one wants to admit that fact.

The Mirror

Good morning. Siri, Alexa, Google: what’s the weather today. Email check. Train time check. Car, text my boss and tell them I’ll be late. More email on the train. News on the phone or tablet. Kudos if you still read the sheets. Lunch order on an eating app. Calendar. The list goes on.

Now imagine you used one of those apps and it had no context. Who’s Boss. What location. Where is the train to and from. What news are you interested in. Technically all of these things are available at home, on home computers. But what makes them useful is your personal context. With context comes external compute and storage. The cloud.

You are, if you will excuse the theatrical accusation to make the point, driving the need for more data centers every day, and have been for ten years. Probably longer, but less explosively. The ledger agrees: the congressionally mandated Berkeley Lab study has data center electricity demand tripling over the past decade, and the long tail runs back to the cloud’s arrival.

If a food ordering app didn’t remember your last takeout order, or what was in your last grocery cart, you would tut. That tut is a purchase order for chips.

AI is the cloud on repeat, and we are making the same mistakes. Which raises the only question with any teeth left in it: if the cycle is repeating, does the governance repeat too?

The Lever

That question is being answered right now, mostly in state houses, and it is worth watching who answers it which way. In 2025 more than 40 states considered 267 data center bills. The mix has flipped since the gold rush: tax incentive bills fell from 58 percent of state data center legislation in 2024 to about 15 percent in 2026, while transparency and disclosure bills rose from under 2 percent to 25, water bills from 12 to 24, and ratepayer protection bills from 5 to nearly 12. Twenty one bills this year propose outright moratoria, in states that were competing to attract these facilities two years ago.

New fences are going up. Oklahoma passed a ratepayer protection act making large loads pay their fairly allocated costs. South Carolina and Maryland enacted rate negotiation laws. Minnesota created a dedicated water permitting requirement. Alabama put large load contracts under review at its utility commission. Idaho limited which water sources data centers may buy for cooling. New York passed a first in the nation one year moratorium on large data center permits in June, now waiting on the governor. Arizona, Illinois and Ohio paused their tax incentives.

And fences are being blocked, and here is where it gets uncomfortable for the neat version of the story, including mine. New Jersey’s governor, a Democrat, vetoed a water use disclosure bill. California’s water reporting bill passed both chambers and was vetoed. Virginia’s previous governor, a Republican, vetoed a bill letting localities weigh data center noise, water and land impacts, and the new Democratic governor softened the cost shift bills instead of signing them whole. At street level this is not red versus blue. It is money versus neighbors. In one Colorado session, 196 lobbyists registered on data center bills. Count the lobbyists on the neighbors’ side.

There are federal proposals in play too: public disclosure of site selection 180 days before ground breaking, a requirement that data centers over 20 megawatts generate their own power off grid, a ratepayer protection pledge. Boring bills. Load bearing bills. The lever is not the keynote or the culture war clip. It is who votes for disclosure and who vetoes it. That is where these issues are controlled.

The Close

I have been making the same argument all series. Nobody sues the ramp. Aim at the practice, not the tool. The tool did not decide where to build, what to review, what to skip, or who pays. People decided, in rooms with rules, and for twenty years the rules mostly held. We all watched the cloud grow up inside them. Then the rules were cut, on paper, in public, with dates and signatures.

The fences were there for a reason. The people who built them knew what happens without them. If you are angry about the power and the water, good. Be angry at the right thing. Ask who cut the strings. And then ask the only question that ever rebuilt a fence: who is voting to put it back?

Edited with AI.