Seattle's city council voted unanimously to ban new large-scale datacenters for one year. The ban covers new facilities requiring 10 megawatts of power or more, and it took effect immediately. Existing datacenters can still expand. The council can extend the ban by a further six months if needed.
The vote came after residents and environmental groups sent over 54,000 messages to city leaders opposing the proposed projects. Five large datacenter sites had been under consideration by Seattle City Light, the city's publicly owned power utility. Together, they could have demanded up to 369 megawatts of power: roughly one-third of Seattle's entire current average electricity use, or enough for about 300,000 homes. Two of those proposals have since been withdrawn, but the political problem did not disappear with them.
Seattle already has around 30 small datacenters with a combined capacity of about 156 megawatts. The new proposals would have more than doubled that, almost overnight, with facilities far larger than anything built there before. One proposed site in the SODO neighborhood was a nine-story structure with its own electrical substation attached.
The city's power grid was the central concern. Seattle City Light told city officials that its network is already operating near capacity. A separate higher electricity rate specifically for large datacenter customers is being designed for 2027 and 2028, so that residents and small businesses do not end up subsidising the infrastructure costs of big tech projects.
This matters well beyond Seattle. There are now over 60 active datacenter moratoriums across the United States, in cities including Denver, Baltimore, and Minneapolis, as well as dozens of counties in Michigan, Illinois, Georgia, and North Carolina. A Gallup poll found that 70% of Americans oppose datacenter construction in their local area, with nearly half strongly opposed. Electricity bills rose 6.9% in 2025, more than double the general inflation rate. In areas near large datacenter clusters, wholesale electricity costs have risen as much as 267% over five years.
The cost pressure has become a genuine political issue at every level of government. Two governors won their races in 2025 partly on promises to reduce electricity bills. President Trump secured a public commitment from Microsoft not to let its datacenters push up local prices. Goldman Sachs estimates that datacenter demand will account for 40% of all electricity demand growth through the end of the decade, and warns this will reduce household spending power and slow economic growth.
The industry's counterargument is real but increasingly hard to sell. Datacenters do bring tax revenue and construction jobs, and well-structured rate agreements can make them pay their own way. But that argument requires trust between companies and communities, and that trust is gone in many places.
For businesses of any size that depend on cloud services, AI tools, or digital infrastructure, the practical consequence is that new datacenter capacity in many US cities will be delayed or redirected to locations with fewer restrictions. Rural areas, states with looser rules, and markets outside the US are picking up demand that urban cores are now refusing. That does not stop the buildout; it redirects it. What it does change is the political environment in which every tech company now has to operate.
Saline Township in Michigan saw its local board reject an OpenAI and Oracle datacenter project, only for the developer to sue and eventually win the right to build anyway. Not every city will hold the line. But the cost of ignoring local opinion is rising, and Seattle's unanimous vote is the clearest signal yet of where that pressure is heading.