The Japan Times - Maryland groups seek statewide data center pause after local moratoriums spread

Maryland faces growing pressure to adopt a statewide policy for data centers after 14 of its 24 local jurisdictions moved to impose temporary development bans. More than 60 advocacy organizations are asking state leaders to pause new proposals while environmental, electricity and community impacts are assessed.

The request arrives less than two months before Governor Wes Moore's reelection contest against Republican Dan Cox. Cox supports a statewide ban on hyperscale data centers. Moore has called for developers to pay the costs their projects create, but has not joined the call for a statewide moratorium.

In an August 27 letter, the groups said development was advancing faster than governments could evaluate risks or create appropriate standards. They argued that households and communities were being asked to accept consequences before safeguards had been established.

The organizations cited a 44 percent increase in residential energy bills from 2020 to 2025 and attributed much of the increase to data-center demand. They also raised concerns about large water withdrawals, potential chemical contamination and additional burdens on Black, brown and Indigenous communities near industrial facilities.

Both advocates and an energy-policy researcher interviewed for the report cautioned that data centers are not the sole cause of higher electricity charges. The debate includes how much growth in server-farm demand contributes to costs and how those costs should be allocated.

The legislature's most recent session commissioned an analysis of data centers' effects on air, water, the Chesapeake Bay watershed and the electricity grid. The work involved the Maryland Department of the Environment, Maryland Energy Administration and the University of Maryland's Robert H. Smith School of Business.

The Department of Legislative Services is responsible for coordinating the final report and submitting it to the governor and General Assembly. It was due September 1. The governor's office described the report as forthcoming and said the administration would review it.

Jomar Lloyd, Maryland organizer for Food & Water Watch, said local officials were being left to design rules for an industry many communities were not prepared to accommodate. His organization signed the August letter and supports a state-level pause.

Lloyd cited tax exemptions, water use and grid upgrades among costs associated with data centers. He said Maryland paid $108 million in data-center-related transmission costs in 2024, while acknowledging other contributors to increased energy bills.

The current campaign follows the failure of House Bill 120 in the 2026 legislative session. The Republican-led measure sought a statewide moratorium but died in committee.

Kim Coble, executive director of the Maryland League of Conservation Voters, attributed that failure to industry resistance and provisions favoring gas and nuclear power that divided conservation groups. She expects stronger opposition to data-center development to affect the 2027 session.

Coble said future legislation should address a pause in construction while the state resolves questions about water consumption and quality, energy supply, transmission infrastructure, community benefits and suitable locations.

She favors a statewide framework but said counties are entitled to act independently if state leaders do not make progress. A patchwork of rules could encourage developers to choose jurisdictions without restrictions, she said, reinforcing the argument for consistent state policy.

Coble and Lloyd differed over how publicly engaged Annapolis had been. Coble said legislators clearly recognize the relationship between data centers and affordability, with siting concerns providing another major source of opposition.

Lloyd said Food & Water Watch had held informal discussions with some lawmakers but had not received responses to the letter from legislators or the governor's office. He argued that elected officials needed to address residents' concerns more openly.

In a statement, Moore spokesperson Rhyan Lake said the governor believes data-center developers should pay their own power costs rather than transferring them to Maryland ratepayers.

Lake also said proposed facilities should employ local workers, support economic growth, consult surrounding communities and protect the environment. No project should go ahead without local support, according to the statement.

Moore has warned against allowing the industry to set its own rules, citing Northern Virginia, and has pressed for changes to the governance of PJM, the regional transmission organization. His office says greater transparency and accountability to customers are needed.

The governor recently signed the Utility RELIEF Act. The legislation is intended to reduce bills, modernize the electricity network and require large customers, including data centers, to cover infrastructure upgrades driven by their developments.

Maryland's dispute forms part of a national pattern. Data Center Watch's report for the first three months of 2026 identified at least 75 projects, worth nearly $130 billion, that were blocked or delayed by local opposition.

The report said that volume matched the scale of disruption across all of 2025. It also found that active opposition groups had more than doubled since the final quarter of 2025, spread across 49 states, and that statewide moratorium proposals had emerged in 14 states with bipartisan support.

Yueming 'Lucy' Qiu, a University of Maryland School of Public Policy professor and holder of the Roy F. Weston Chair in Natural Economics, described a moratorium as a temporary planning instrument. She said it can prevent some expenses when adopted before infrastructure commitments become fixed.

A pause could also allow regulators to improve forecasts of electricity demand and determine how new large users should connect to the system and pay for it. But it would not address existing facilities or investments already under construction.

Nor would a Maryland-only restriction fully protect residents from data-center growth elsewhere in PJM's territory. A project relocated to another state could still increase regional capacity and transmission pressures that affect Maryland customers.

Qiu identified several other contributors to rising residential bills: distribution-rate increases, power-plant retirements, reliability-must-run payments, transmission spending and weather-related demand. She said data centers matter for recent capacity and transmission costs but do not explain the entire increase.

She expects a development pause to produce a combination of postponements and moves to other locations. Companies could likely accommodate a clearly defined six- or 12-month delay, she said, whereas an indefinite restriction would create stronger incentives to leave.

Relocation could reduce some local environmental and infrastructure effects while costing Maryland construction activity and tax revenue. It would not necessarily reduce electricity pressures across the wider region.

Qiu favors requiring large electricity users to pay the costs they generate. She also recommended disclosure of duplicate interconnection requests, noting that one company may investigate several locations at once.

If utilities treat all of those possible sites as likely projects, demand forecasts can be overstated, she said. More accurate information would help distinguish actual future demand from multiple versions of the same potential development.

The Data Center Coalition urged local governments to work with the industry on regulation instead of adopting bans or moratoriums. The trade group said restrictions discourage investment and that data-center operators are committed to covering the full cost of their energy use.

The coalition cited analyses by Virginia's Joint Legislative Audit and Review Commission and the Arizona Corporation Commission. It also referenced research from consulting firm E3 and Lawrence Berkeley National Laboratory that found data centers were not the main driver of electricity rates nationally.

According to the coalition, the industry supported 5.5 million jobs, $1.7 trillion in gross domestic product and $204 billion in federal, state and local taxes nationwide in 2024. Those national economic claims sit alongside unresolved Maryland questions about siting, resource use and the allocation of regional grid costs.

T.Sasaki--JT