Massachusetts hits data centers with new clean power rules

Massachusetts became the latest state to force data centers to bring their own power, though with a twist. A new mandate from Gov. Maura Healey requires developers building data centers larger than 25 megawatts to provide clean power or pay into a ratepayer protection fund. The executive order is the latest example of states turning against data centers — just a few years after tech companies and data center developers were showered with incentives to locate facilities in a given state, they’re now fighting a groundswell of public opposition as politicians look to show voters they’re addressing the concerns.

Under the order, data centers with more than 25 megawatts of peak demand must bring their own power and guarantee it meets the state’s clean energy requirements. Healey would prefer that they generate the clean power on-site; if not, they’ll need to fund construction of new generation nearby or pay into the ratepayer protection fund. Massachusetts is also directing communities to avoid signing non-disclosure agreements, according to the executive order. To give regulators time to implement the restrictions, Healey is pausing applications for a data center sales tax exemption that took effect last month.

Data centers must meet the Massachusetts clean energy standard set in state law, though with added strength: the standard normally requires industry to generate only a portion of its power from approved sources like wind, solar, and hydro — for example, at least 40% by 2030, with the share rising over time — but the governor’s office clarified that data centers specifically must meet 100% of their electricity demand with clean energy generation.

Massachusetts is the third state in as many months to rein in data center development. In August, Texas governor Greg Abbott said all new data centers in the state would need to submit to audits by the public utility commission and grid operator ERCOT; in July, the state of New York halted construction of new data centers of 50 megawatts or larger. As public sentiment shifts against data centers, the tech industry is starting to push back — pro-AI super PAC Leading the Future, funded by Marc Andreessen, Ben Horowitz, and Greg Brockman, is buying ads aimed at swaying voters in battleground states ahead of the midterm elections.

Why it matters

As more states impose bring-your-own-power mandates, data center developers face a patchwork of energy rules that could slow AI infrastructure buildout in the U.S. just as compute demand keeps climbing.