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Round-Up for the Week of September 22-26, 2025

Tech companies are also planning to use new broadband infrastructure to power data centers with enormous processing capabilities for a variety of applications, including artificial intelligence. However, the data center buildout comes with economic and environmental risks for many communities, especially those in the southern parts of the U.S. For marginalized communities in the South, the construction of data centers represents another stage in a history of economic extraction, which may impact their ability to reap the benefits that forthcoming broadband infrastructure buildout has to offer. The following includes portions of MediaJustice's report, "The People Say No: Resisting Data Centers in the South."

Facing an Influx of Data Centers

U.S.-based tech companies are expanding their data centers globally. In 2024, at least $455 billion was invested worldwide in data centers and related infrastructure. This figure is expected to grow by 30 percent in 2025, with an estimated $1 trillion set to be invested in the U.S. alone over the next five years. Microsoft, Amazon Web Services (AWS), and Google Cloud are currently the largest “hyperscale” providers in the world, though other companies have emerged as major investors in the space. Hyperscale data centers, such as those operated by these companies, house critical compute and network infrastructure, including that required by artificial intelligence (AI) to function.

In January 2025, President Trump—alongside OpenAI’s Sam Altman, Oracle’s Larry Ellison, and SoftBank’s Masayoshi Son—announced a $500 million AI data center investment known as Project Stargate, though plans have since been significantly scaled back.

The U.S. is home to 60 percent of globally installed data center capacity and will continue to be the largest data center market in the near term. As of March 2025, the U.S. had 5,426 data centers, and their ownership was highly concentrated among a small number of corporate giants. Data center construction has also attracted private equity firms such as Blackstone, which is one of the largest investors in AI infrastructure worldwide.

While some companies, such as the Big Tech giants, build data centers to meet their own computing needs, others develop data centers to be leased out to third parties. This model is known as “colocation,” in which data centers rent dedicated networking equipment or server storage to companies, allowing them to run their daily operations. These data centers can host multiple companies within one physical building, offering retail or wholesale space.

The rise of computational and storage services, combined with the emergence of AI, has led to a direct increase in the scale of physical requirements, such as graphics processing units, wires, server racks, and other facility equipment, dramatically expanding both the size of data centers and the resources required to operate them. This is where hyperscale data centers and the companies that develop them ("hyperscalers") come into play. Hyperscalers' large-scale facilities offer extensive space, power, cooling, and infrastructure to support massive data and cloud computing operations.

As data centers expand in size, so do the energy requirements needed to power them. In February 2025, Goldman Sachs forecasted that AI alone would drive a 165 percent increase in data center energy consumption by 2030. The investment bank also estimated the current energy consumption by the global data center infrastructure at 55 gigawatts, projected to grow to 122 gigawatts by 2030. For the sake of comparison, around 106,872,000 households in the U.S. could be powered for a year with 122 gigawatts of energy, covering most of the country’s population.

Electricity is not the only resource consumed by power-hungry data centers. Water, a crucial resource for the livelihoods of people worldwide, is also a key resource for most data centers. In 2023, Meta’s data centers consumed 776 million gallons of water globally, while Google’s data centers used 6.1 billion gallons worldwide. That same year, Google sparked public backlash against a planned data center in drought-stricken Uruguay. The project is estimated to use 46 million gallons of water daily, enough to cover the domestic needs of 55,000 individuals.

MediaJustice finds that prominent individuals in the AI sector have increasingly warned that the market may be overvalued and unsustainable both financially and ecologically. Experts have also noted that public backlash against the risks posed by generative AI, particularly on copyright and authorship, has led to growing resistance to adopting such tools in the workplace.

What This Means for the South

MediaJustice finds that since the 2010s, the South has seen a significant increase in the number of data centers. As of August 2025, Virginia housed 13 percent of global data center capacity and 25 percent of total capacity in the Americas, primarily in the northern part of the state. The data center industry contributes around 9.1 billion to Virginia’s gross domestic product (GDP). However, most of the economic value from data centers is attributable to the sites’ construction phase rather than their ongoing operations.

The number of data centers in the South is only going to grow. Big Tech companies are investing billions in building and running data centers in the region. As of August 2025, these companies have committed over $200 billion in medium and large data centers in North Carolina, Arkansas, Louisiana, Mississippi, Virginia, Georgia, South Carolina, Alabama, and Tennessee, though this total is incomplete. Many projects are in active development or expansion, with some funds already invested and additional investments planned.

According to MediaJustice, major project developers in the South have concealed key information from the public, including water and energy consumption, deals with local officials regarding tax breaks and other incentives, and even the names of companies. What is known is that most data centers are being developed by companies based outside of the Southern U.S., in keeping with a longer history of economic extraction in the region.

Established data center markets in the South—such as Virginia, Georgia, and North Carolina—foreshadow the potential impacts that will likely be felt in emerging markets, including Louisiana and Mississippi. And as fiber-optic cable and electricity transmission lines have expanded into rural communities, data centers have taken advantage of the infrastructure and are currently building massive facilities outside major cities.

Case Study: Georgia

In Georgia, there were at least 98 data centers as of August 2025, most of which were located in the Atlanta metropolitan area. Well-known companies such as Google, Meta, Microsoft, and Elon Musk’s xAI are building or currently operating data centers in this area, while smaller and apparently unrelated firms are also developing data center sites for future sale.

Atlanta was an early adopter of and investor in fiber-optic cabling, reaching a crucial point in 1996 during the Centennial Olympic Games when international media outlets required optical fiber infrastructure to speed up their broadcasts. This laid the groundwork that would later attract the many data centers currently located in Atlanta. The city’s close proximity to the coast and international undersea internet cables played a crucial role in the development of the electronic payment processing industry. This industry, which relies on dedicated servers, emerged as a direct result of the newly available cable infrastructure. In fact, over 95 percent of internet traffic passes through undersea cables, making cities close to the coast more attractive for establishing data centers.

The data center industry is growing faster in Atlanta than in any other U.S. city. The industry generates very few permanent jobs but benefits from considerable tax breaks that have undermined public budgets. Even so, local governments have sought development for the large number of construction jobs required during the initial phase. However, many communities have begun to worry about the effects on water supply and electricity, especially where the Atlanta metro area has expanded into previously rural landscapes.

Recently, fiber-optic cables have begun to sprawl away from the Atlanta metro area into rural communities, with the purported intention of bridging the digital divide. However, MediaJustice notes, as digital infrastructure expands into rural communities, sites that were previously unappealing to data center developers become more accessible and may attract large hyperscale data centers, which threaten communities’ access to electricity and water.

Meta’s data center in Newton County (GA) is surrounded by rural and residential areas and is located seven miles away from Lake Varner. The massive data center accounts for 10 percent of the county’s total water use on a daily basis and has affected local water wells across the region. However, Meta is not the only data center seeking to settle in Newton. At least nine data centers have applied for construction permits in the county, requesting officials to allocate as much as six million gallons of water per day, exceeding the county's current daily usage.

Fiscal Incentives Attracting Data Centers to the Region

At the core of data center expansion in the South are tax breaks and other fiscal incentives, which have attracted several large projects. Some governments have also promoted their low unionization rates as a key advantage for companies seeking to build data centers and avoid organized labor opposition. Many Deep South states have unionization rates below the national average (9.9%), including Tennessee (5.6%), Louisiana (5%), Georgia (4.4%), Arkansas (4.4%), South Carolina (4.4%), and North Carolina (3.1%).

According to the University of Georgia, 90 percent of data center activity in Georgia was attributable to tax breaks, and early estimates (pre-dating the data center boom after 2023) suggest that the state government would lose over $80 million in sales tax revenue as a result.

Tax breaks can divert funds away from direct government expenditures that support schools, tackle income inequality, and invest in public transit, environmental remediation, and other community needs, which may vary by location and state. This affects marginalized communities the most, especially communities of color in the South.

For instance, data centers are being placed in communities where people of color represent a greater portion of the population, much larger than state averages. Such is the case of Georgia, where data centers are located in areas with an average of 61.1 percent of people of color, compared to the state average of 47.2 percent. At the national level, people of color make up 42 percent of the overall population of the U.S., but represent 52 percent of those living in counties with unhealthy air pollution levels.

In May 2024, the state legislature passed a law that would have suspended data center tax breaks until 2026 if it had not been vetoed by Governor Brian Kemp (R-GA).

Ultimately, data centers have an impact well beyond their construction site, as they depend on transmission lines for electricity, fiber-optic cable for moving data in and out of the facility, and material requirements such as wires, computers, and graphics processing units. 

MediaJustice on Community Solutions

What's the best way for communities to prevent potential harms from data center builds? Organize.

These pathways to community protection are rooted in awareness, advocacy and organized resistance:

1. Just say “no” to data centers. MediaJustice calls on organizers across the South and the USA to reject the idea that data centers are inevitable. 
2. Demand a public process, not secrecy. MediaJustice recommends calling on local elected officials to negotiate data centers out in public and not behind NDAs and closed doors. 
3. Protect natural resources and expose corporate greenwashing. MediaJustice tells consumers to reject false solutions from tech companies like using recycled water and renewable energy certificates; the organization says that these only obscure companies' actual water and energy use. 
4. Fight against surveillance and Big Tech’s control and collection of consumer data. MediaJustice says opposing surveillance and opposing data centers is part of the same fight to protect communities from corporate and State harm.

Data Centers, AI and Digital Opportunity

Many in the digital equity community have embraced the benefits of AI for digital skills learning and digital applications that consumers can use. However, MediaJustice's report asks readers to consider whether communities can handle the demands of AI and the data centers needed to maintain it. The report addresses the rising costs of utilities for communities—many of which were already underserved—near to data center developments. Rising costs impact not only energy and water utilities, but for low-income consumers struggling to afford their bills, this may cause expenses like a broadband subscription to be even more unaffordable. The larger question looming here, as data center construction coincides with nationwide broadband infrastructure buildout, is whether the costs of AI and data centers will force marginalized communities to go without the online resources they need.

Visit MediaJustice's website to read the full report.

Quick Bits

• BEAD Awards vs. Allocations: Deep Dive on Benefit of the Bargain Results
• Building Digital Equity in West Philly: New 5G Tower Installed at 3.0 University Place
• A massive telecommunications threat was stopped right as world leaders gathered at UN headquarters in New York
• Supreme Court Allows Trump to Fire FTC Commissioner Slaughter

Weekend Reads

• The Status of Digital Inclusion Coalitions
• Stuck in the Middle: Internet Insecurity in Rural America
• Operational AI in Education: Readiness, Realities, and the Road Ahead
• Reusing the News: Duplicating Local TV Content

ICYMI from Benton

• From Promises to Performance: BEAD Enforcement Tools States Need Now
• Just More BEAD Plans
• The BEAD Plan for Western North Carolina: What You Need to Know
• House Panel Considers the Role of Permitting in Broadband Deployment

Upcoming Events

Sep 30––September 2025 Open Federal Communications Commission Meeting (Federal Communications Commission)

Sep 30––BEAD Deployment: Preparing to Connect the Heartland Once and For All (Heartland Forward)

Sep 30––Permitting for Broadband Infrastructure Projects (National Telecommunications and Information Administration)

Oct 7––Western North Carolina Digital Opportunity Pitch Party (Blue Ridge Broadband Alliance)

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