The rapid expansion of artificial intelligence infrastructure in the United States is facing a significant headwind following yesterday’s elections. Voters across the country overwhelmingly supported candidates and ballot measures that advocate for stricter regulations on AI and data centers. This shift signals a potential slowdown for the large-scale buildout that has been a priority for the current administration.
Data from Redbud Consulting, a polling firm that tracked data center initiatives, indicates that 38 out of 44 measures across ten states seeking to restrict data centers have passed so far. These measures included numerous moratoriums and bans. Only one measure allowed a data center to proceed without major hurdles, and even that win required developers in a North Dakota city to pay for independent reviews and hold public hearings when proposing or expanding projects.
Analysts suggest that these new regulations will not immediately impact data centers that are already under construction or approved through 2027. Instead, the restrictions are expected to largely affect future projects planned for 2028. This timeline shift could alter the trajectory of the industry’s growth over the next several years.
In addition to passing restrictive measures, voters also elected officials who campaigned on anti-AI platforms in key states. These states are currently building out the most data center capacity in the United States. The election of these officials adds a political dimension to the regulatory changes, as new state leaders will have the authority to influence how these projects move forward.
The most notable result came in Texas, where Democratic challenger Gina Hinojosa won the governor’s race. According to Axios, this victory could fundamentally change the calculations behind the national AI buildout. Bloomberg reported that Hinojosa’s election has left developers facing a worst-case scenario, as Texas is considered the epicenter of the current AI boom.
Texas was expected to account for more than 41 percent of added data center capacity in 2028. With Hinojosa in office, approximately 13 gigawatts of data center capacity is now exposed to new regulatory risks. She has stated that she plans to delay projects as long as necessary to pass laws that address impacts on water, electricity, air, and property rights.
Gordon Johnson of GLJ Research noted that projects in Texas that already have power, permits, and steel in place will continue to move forward. However, those with power but lacking state environmental permits may slip by 12 to 18 months. Johnson warned that Hinojosa would impose a moratorium until legislation is passed that gives communities a voice, protects household utility bills, and ends tax incentives for data centers.
Some projects may leave the state entirely, potentially moving to Louisiana or Georgia, or perhaps going nowhere at all. The uncertainty has led some analysts to predict a broader impact on the industry. Libby Cantrill, head of public policy at PIMCO, warned that even if statewide moratoria do not result, the AI buildout will likely face more friction, with more time required to secure permits and other approvals.
Cantrill added that developers will likely have to make more concessions to proceed. This suggests that the era of rapid, unchecked expansion may be coming to a close, replaced by a period of greater scrutiny and community engagement. The question now is how long the pause will last and whether other states will follow Texas in implementing similar delays.
