President calls on tech leaders to ‘convince your community’
Democratic U.S. Senate nominee James Talarico is pushing for new regulations on data centers amid growing voter frustration over rising utility bills, water use and lack of community input.
Talarico, a state representative hoping to become Texas’ first Democratic U.S. senator in over three decades, held a press conference in downtown Austin on Wednesday calling for safeguards on water use, electricity demand and community impacts. He advocated requiring large energy users like data centers to fund infrastructure improvements rather than passing costs to consumers, allowing local communities a greater say, and ensuring good-paying union jobs and fair tax contributions.
“Data centers are jacking up utility bills across the state of Texas,” he said. “Billionaire-backed politicians are giving sweetheart tax deals to giant AI companies and then sticking us with the bill.”
Calling for the Lone Star State to “be a leader when it comes to innovation and technology,” Talarico warned any future economic growth spurred on by the construction of data centers must benefit everyday Texans.
“That’s not what’s happening right now,” Talarico said. “We’re often told in our politics that we have to choose between policies that are pro-growth and pro-people. I reject that choice, and the plan that we’re outlining today to hold data centers accountable, I think, strikes a balance between welcoming those investments while also protecting working people.”
While Talarico stopped short of supporting a statewide moratorium favored by some Democrats, he called for lawmakers to establish a regulatory framework that prioritizes jobs and safeguards residents from potential health hazards linked to data centers.
Pointing to an estimated $3.2 billion in tax breaks for data center companies in Texas, Talarico added, “I mean, just think about the good that that those revenues could do for our communities of bringing down the cost of housing and child care and prescription drugs.”
In contrast to Talarico’s approach, Paxton has emphasized the strategic necessity of rapid data center growth to compete with China while acknowledging local concerns.
In a May interview with podcaster Patrick Bet-David, Paxton described the issue as “complicated” because “we are competing with China with artificial intelligence, and we cannot lose that race.”
“We’ve got to figure out a way to keep up and not just keep up — to excel and make sure that they don’t finish ahead of us. They’re not ahead of us because we know that they are an enemy,” he said.
At the same time, Paxton expressed sensitivity to communities who have concerns about data centers. “I have a lot of sensitivity to local communities that don’t want things built next to their neighborhoods. I think there needs to be some balance,” he said. “Those local elected officials who represent them at the state level are ultimately going to have to look at this from sort of a global standpoint.”
Paxton’s position closely aligns with President Trump’s voluntary “Ratepayer Protection Pledge,” which aims to shield consumers from higher bills tied to the AI-driven data center boom. On Thursday, Trump gathered governors and electricity companies to reinforce the nonbinding commitment, originally announced with tech firms in March.
“You have to convince your community,” Trump said. “You can’t fight it. You have to go with it.”
After predicting that Americans’ electricity bills would “actually come down,” the president added: “If you don’t take all that money, somebody else is going to take it. You might as well do it yourselves.”
The data center surge has become a flashpoint in Texas, which currently has roughly 300 operating data centers with more than 100 planned or under development.
