Data centers are good, actually

The controversy over AI data centers is following a very similar pattern as the panic over nuclear power. Some decided that nuclear power must not be allowed anywhere near them, and no amount of additional information could change their minds. But, like nuclear power, data centers are necessary to modern life, and North Carolinians should embrace, rather than fear, them.

First, it’s worth conceding that AI data centers are new and there are some kinks to work out. But those issues are actively being worked out.

I’m not a tech expert, so I don’t know exactly what it means that AI data centers can use 10 times more kilowatts per server rack than data centers for traditional internet, but it’s clear that AI data centers are using massive amounts of electricity. And if all of the energy demand is placed on the same grid as the rest of us use, then either there will need to be a lot more energy production to match, or electricity rates will spike.

Well, that problem is being taken seriously. President Trump created a Ratepayer Protection Pledge, where utilities and AI companies agree to require AI data centers to “Build, bring, or buy new power supply” they need, rather than relying on existing infrastructure.

And already the pledge has covered “roughly 80% of the power delivered to American homes and businesses, protecting 263 million Americans — three-quarters of the country — when a data center is built nearby.”

Duke Energy announced this week that they are among the pledge-signers, with Harry Sideris, Duke Energy’s president and CEO, saying, “Data centers will provide billions of dollars in customer benefits. Duke Energy remains laser-focused on ensuring data centers not only pay their fair share but also yield savings for our existing customers.”

So this major objection to data centers, on their energy use, is getting worked out, it seems. There are also complaints about noise and light, which are common to many industrial sites. From what I’ve seen, there are also efforts to work these out. Anyone living near the data centers and experiencing such nuisances, should push that they be resolved. There are also concerns that AI will spur major job losses or even cause more dystopian effects.

But many national figures are using these early hurdles and concerns as justification for calling for complete bans of new AI data centers. Far-left duo US Sen. Bernie Sanders and US Rep. Alexandria Ocasio-Cortez put out a bill earlier this year that would do just that, saying we need to “slow down the development of AI to give democracy a chance to catch up.”

“AI and robotics are creating the most sweeping technological revolution in the history of humanity… Congress is way behind where it should be in understanding the nature of this revolution and its impacts,” Sanders said when announcing the bill. “Bottom line: We cannot sit back and allow a handful of billionaire Big Tech oligarchs to make decisions that will reshape our economy, our democracy and the future of humanity. We need serious public debate and democratic oversight over this enormously consequential issue. The time for action is now. We need a federal moratorium on AI data centers.”

And his partner, Ocasio-Cortez, was equally vague and sweeping in her condemnations.

“We have seen ICE partner with AI companies to surveil Americans, social media users employ AI bots to create sexually explicit deepfakes of women and children, and data center construction inflate electric bills in communities across the country,” she said. “And all of this harm has occurred because of the absence of federal legislation to regulate AI. Congress has a moral obligation to stand with the American people and stop the expansion of these data centers until we have a framework to adequately address the existential harm AI poses to our society. We must choose humanity over profit.”

The bill, they say, “will stop a global race to see which country is the first to eliminate hundreds of millions of jobs, or the first to build an AI that destroys the planet.”

Local governments in North Carolina, often spurred by frantic calls from residents, are increasingly passing moratoriums on AI data centers, in case one spontaneously attempts to open in their neighborhood. Even my little town of Hillsborough just passed a two-month pause, despite no requests to locate data centers there. Bigger cities like Charlotte have done the same.

But AI is already deeply integrated in virtually every sector of the economy. An InDataLabs report from earlier this month cited overwhelming evidence that industry after industry was successfully using AI to save money and improve services. Over 70% of businesses were using AI by the end of 2025, with that number likely much higher now.

Some success stories include fintech giant Klarna deploying a customer service agent that saved $60 million while reducing call response times from 11 minutes to under 2 minutes, without a drop in customer satisfaction. Walmart was able to improve warehouse productivity by 20% by automating storage and retrieval processes. Their AI-operated robotic arms alone saved 15% at pilot locations.

The same is being experienced in healthcare, transportation, communications, and so much else. Billions if not trillions are being saved. Yes, there are things to be worked out, but the potential for advancements is massive, and much of it has yet to be realized.

In the United States, we’ve already seen spending on basic necessities as a percent of our income plummet over the last century, as markets and technological advancements have made life much more efficient and affordable. Some stubborn areas, like housing and healthcare, could certainly use more efficiencies, but we’ve come a long way from the universally impoverished natural state of man.

NC Chamber of Commerce president and CEO Gary Salamido told Carolina Journal regarding data center bans that “Capital flows where it is wanted and stays where it’s welcome, so moratoriums certainly send a message. Data centers are the foundation of the modern economy and will be built somewhere.”

Salamido said projects like Amazon Web Services’ planned $10 billion investment in Richmond County and Google’s $1 billion expansion in Caldwell County will generate years of construction activity and, once operational, they become major local taxpayers.

“Because of the value of their facilities and equipment, they generate substantial property tax revenue that helps fund schools, public safety, and infrastructure,” Salamido said. “Apple’s Maiden data center, for example, represents approximately $1.47 billion in assessed property value, making it one of Catawba County’s largest taxpayers.”

Some local governments, like Covington, Georgia, plan to totally fund their government services through property taxes on the AI data centers, canceling property taxes for homeowners entirely. Not bad. But if you chase away the data centers, or ban them entirely like some at the national level want to do, we won’t see any of these benefits to the market or to taxpayers. Certainly there are some kinks to be worked out. But states and localities that calmly address them and embrace a major economic opportunity will see massive benefits. Those that give in to fear and shut the doors, like with nuclear power, are likely to miss out.

“Data centers are good, actually” was originally published on www.carolinajournal.com.