The rapid expansion of artificial intelligence infrastructure is colliding with electricity grids on both sides of the Atlantic, generating a surge of environmental concern, regulatory scrutiny, and public opposition that is starting to slow the industry's build-out in concrete ways. Data centres already consume around 6 percent of electricity supply in both the United Kingdom and the United States, according to recent industry estimates — a figure that industry analysts say is climbing rapidly as AI workloads multiply. The consequences are landing on ratepayers' bills, on national climate targets, and on the communities where the facilities are being built.
In the United States, the U.S. Energy Information Administration projected that power demand would rise to 4,283 billion kilowatt hours in 2026 — up from a record 4,097 billion kWh in 2024 — with data centres identified as a primary driver, alongside electrification of heating and transport. On PJM Interconnection, the 13-state grid that is the largest in the country, wholesale power prices jumped 76 percent in the first quarter of 2026 compared to the same period in 2025, averaging $136.53 per megawatt-hour against $77.78 a year earlier, according to a report by the grid's independent market monitor cited by Bloomberg. PJM's own executive vice president of market services, Stu Bresler, confirmed that data centres were responsible for a majority of the projected 5,400-megawatt increase in grid demand projected for 2026.
Consumers Pay as Utilities Race to Keep Up
The cost pressure is reaching households. Utility companies requested state commissions to approve rate increases worth $9.4 billion in just the first three months of 2026, according to a report by the nonprofit PowerLines — following a record $31 billion in rate-hike requests for all of 2025, more than double the $15 billion sought in 2024, as reported by Fortune. Critically, nearly half of those 2025 requests had not yet been approved as of early 2026, meaning a significant wave of additional bill increases is still working through the regulatory pipeline. Virginia resident John Steinbach told Consumer Reports his electricity bill spiked to $281 in January 2026, more than double his typical payment, a pattern being reported by ratepayers across Northern Virginia's dense concentration of AI data centre campuses.
Lawmakers in more than 30 states have introduced over 300 bills in 2026 dealing with data-centre energy policy, moratoriums, and cost allocation, according to Multistate. In January, Reps. Mike Levin and Kathy Castor introduced the SHIELD Act to require large-load consumers rather than households to bear the costs of grid upgrades their facilities require. In March, Senators Elizabeth Warren and Josh Hawley — crossing the aisle — pushed the EIA to establish mandatory energy reporting requirements for data centres, writing that without such data, "policymakers, utility companies, and local communities are operating in the dark." The Federal Energy Regulatory Commission is expected to act by the end of June on rules to govern how large data centres connect to the grid.
Seattle Weighs a One-Year Ban
Nowhere has the municipal-level fight become sharper than in Seattle. City officials are weighing a one-year moratorium on new large data centres after four companies approached Seattle City Light proposing five new facilities that would collectively require up to 369 megawatts of electricity per day — roughly one-third of the city's current average daily power usage. Two of those companies have since withdrawn their proposals, but City Councilmember Eddie Lin, who is sponsoring the moratorium legislation, said the pause is still needed to allow the city to develop proper rules. "I don't see us having a permanent ban on all data centers," Lin said at a council meeting last week, "but I do think we need to have appropriate rules and regulations" covering water use, electricity consumption, noise, greenhouse-gas emissions, and jobs.
City Council President Joy Hollingsworth backed the measure, saying it was "not a knee-jerk reaction" and citing the experience of other American cities already grappling with the footprint of large-scale server farms. The Seattle Metropolitan Chamber of Commerce pushed back, with president Joe Nguyen arguing the moratorium would be "more symbolic than functional" — since data centre projects would simply relocate rather than disappear — and warning it risked being read as "another attack on the technology industry." Mayor Katie Wilson's administration said Seattle City Light is separately developing new policies to ensure infrastructure and energy costs from large-load data centres are not passed on to city residents.
UK Datacentres Turn to Gas as Grid Queue Stretches for Years
In the United Kingdom, the tension has taken a different and more immediate form. More than 100 new data centre projects are now planning to burn gas to generate their own electricity — with some potentially doing so permanently — because of the years-long wait to secure connections to the National Grid, The Guardian reported on May 18. Silvia Simon, head of research at Future Energy Networks, which represents UK gas suppliers, told the Guardian her organisation had received more than 100 requests for gas connections from data-centre operators over the past two years. The total gas demand those requests represent amounts to more than 15 terawatt hours per year — enough to power London for roughly four and a half months.
Stuart Okin, Ofgem's director of cyber regulation and AI, laid out the scale of the problem at the All-Energy conference in Glasgow: "There's 100GW of datacentre projects in the queue. Clearly that's not all going to be able to connect to the grid. If a project isn't going to get a connection, it is going to have to come up with an alternative method." The shift to permanent gas generation puts the UK's Clean Power 2030 target in direct jeopardy. Julian Leslie, strategic planning director at the National Energy System Operator, told the Guardian the government's goal was to have less than 5 percent of power supplied by unabated gas, but data centres running on off-grid gas supplies would sit outside that accounting, raising what Leslie called "an interesting question" about what the target actually means in practice.
Public Opposition Hardens — and Starts to Cancel Projects
The backlash is no longer just rhetorical. A record number of data centre projects were canceled in the first quarter of 2026 amid community resistance, according to data from Heatmap Pro, cited by Axios. Morgan Stanley analysts wrote in a note on midterm election market risks that "public pushback is emerging as a binding constraint, particularly around data center buildout," while investment bank Jefferies told clients the cancellations were "sapping confidence" among investors. An Economist/YouGov poll conducted May 9-11 found over 70 percent of Americans believe AI is advancing too quickly — with 77 percent of Democrats and 68 percent of Republicans sharing that view. A separate Gallup survey found only 18 percent of young people between the ages of 14 and 29 say they feel hopeful about AI. Other YouGov polling shows negative views of the technology rising from 34 percent three years ago to just over 50 percent today.
