Maine poised to be first state to pause large data center approvals

Maine is on the verge of becoming the first state in the nation to slam the brakes on energy-hungry AI data centers, as lawmakers push back against tech giants over fears of higher power bills, strained grids and environmental impact.

The measure, now headed to Democratic Gov. Janet Mills, would pause approvals for data centers requiring more than 20 megawatts of power until October 2027, while a state-appointed council studies their impact on the power grid, energy bills and the environment.

The legislation passed the state’s Democrat-controlled House 79-62 and Senate 21-13, marking one of the most aggressive moves yet against the rapid expansion of data centers tied to artificial intelligence and Big Tech.

Supporters say the pause is needed to protect residents from the massive energy demands of so-called “hyperscale” facilities, which can consume as much electricity as small cities.

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“It’s not that there’s no place for data centers in Maine,” Democratic Rep. Melanie Sachs, who sponsored the measure, told The Associated Press. “Frankly, the tradeoffs have not been shown to be of benefit to our ratepayers, water usage or community benefit in terms of economic activity.”

Opposition to data centers has been building nationwide as communities raise alarms about strain on power grids, higher electricity bills and heavy water use. Analysts have warned that parts of the U.S. grid could face reliability issues in the coming years if demand continues to surge.

In February, Sens. Josh Hawley, R-Mo., and Richard Blumenthal, D-Conn., introduced a bill aimed at ensuring the electricity costs of data centers are not passed on to American consumers.

At least 11 other states are considering restrictions like Maine’s, but Maine’s bill is the first to pass both legislative chambers, potentially setting a precedent.

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Critics argue the move could drive away investment and jobs.

“We think that these data centers could bring good jobs, good opportunities to these regions,” Montana Towers, a policy analyst with the free market Maine Policy Institute, told the AP. “And a lot of these concerns about them are luddite in nature.”

The Trump administration has backed data center expansion as critical to competing with China in artificial intelligence, even as it recently pushed tech companies to commit to covering the cost of new power generation needed to run their facilities.

Mills has not said whether she will sign the bill, though she has sought an exemption for a smaller project already underway that would reuse existing infrastructure.

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If enacted, Maine’s moratorium would serve as a test case for how states balance economic growth against the mounting energy demands of the AI boom.

The Associated Press and Reuters contributed to this report.