The 2026 US midterms were the first national election in which AI infrastructure was a front-line ballot issue, and the results landed almost uniformly against the industry. Democrats won control of Congress, and according to CNBC’s analysis, the vote marked “a major rejection of Elon Musk and the artificial-intelligence industry,” with voters electing critics of AI companies and approving restrictions on the data centres that fuel their expansion. Nationally, campaigns and outside groups spent $173 million on ads about data centers — almost entirely negative — during the general election, per AdImpact figures cited by CNBC, with Democratic advertisers accounting for $140 million of it.
The local numbers tell the same story from the ground up. Voters considered 41 local data-centre measures across ten states on election day, and per Ballotpedia’s pre-election tally, 28 of them would have limited development through bans or moratoriums while only 13 facilitated it. CNBC reports at least 10 communities approved bans or restrictions outright.
Texas: the industry’s most valuable flip
Texas was the bellwether, and it broke hard. Governor-elect Gina Hinojosa campaigned against generous corporate subsidies and for a moratorium on new data centers, an end to industry tax breaks, and requirements that developers cover their full electricity costs — and won. Elon Musk spent at least $474 million on the midterms overall, nearly half of it — $224 million — into Texas alone, only to see his favoured candidates, Senate nominee Ken Paxton and Governor Greg Abbott, defeated in the Democratic wave. Musk’s America PAC spent nearly $87 million across 44 federal races and saw 93 percent of that spending go toward contests Republicans lost.
The significance is locational. As CNBC notes, data-centre operations depend heavily on state decisions about electricity, water, environmental permits, infrastructure and tax incentives — and the incoming Texas executive now holds veto power over the industry’s fastest-growing buildout region, the same state where OpenAI’s Stargate-scale projects are under construction.
The pattern was visible before the votes
This did not come from nowhere. Fast Company’s pre-election analysis counted 49 data-centre-related measures across 13 states through the end of 2026 — 84 percent of them decided in November — and found candidates calling for moratoriums in 20 of 36 governor’s races. “There’s hardly a race in the country right now where data centers aren’t playing a role in some form,” Brad Carson, head of the Public First Action super PAC, told the magazine. In South Carolina, a $1.5 million ad buy from Building the Future — the data-centre industry’s new super PAC — could not save Senator Darline Graham from Democrat Annie Andrews, who campaigned on a two-year moratorium. In Ohio, Sherrod Brown defeated Senator Jon Husted after attacking his support for data centres, part of nearly $28 million in Democratic ads criticising them there.
That matches what our own poll-of-polls found two weeks ago: 63 percent of US voters didn’t want an AI data centre nearby, and half wanted the whole race paused. The midterms converted sentiment into law to the extent any single election can.
What a backlash with a mandate actually does
None of this bans AI. It prices the externality. Moratoriums, full-cost electricity recovery, and the end of tax abatements mean data-centre economics now vary sharply by state — the same model applied to the sector that reshaped where and whether fossil plants get built. MultiState’s tracker of the ballot measures shows the movement is local by design: planning and power consent sit at county and municipal level, so the next two years of the buildout will be a patchwork of approvals, rejections and standoffs rather than a single national verdict.
For New Zealand the read-across is direct, and uncomfortable for the pro-build consensus. The US is the sector’s home market and its most permissive regulatory environment for twenty years; if voters there now block campuses over power and water, the assumption that small grids like ours will simply host compute for export revenue looks even thinner. The industry’s two options — become genuinely popular, or start paying full freight for power and water everywhere it lands — just stopped being theoretical.
❓ FAQ
Did voters really vote on AI itself, or just power prices? Both, usually framed as the latter. The 41 measures were about local data-centre land use, but reporting across the campaign shows the ads and candidates explicitly tied them to AI industry power, water and subsidy debates.
What did the industry win? Some races — CNBC notes the industry did defeat Alex Bores, a New York lawmaker who advocates tougher AI safeguards, in a Democratic congressional primary. But it lost the big states’ mood and now faces Democratic control of Congress with sharper scrutiny of the debt-fuelled buildout.
Is a moratorium law already in effect? No. Governor-elect Hinojosa takes office in January 2027; a Texas moratorium would require legislative action and faces legal and economic challenges. What exists today is a clear electoral mandate against unconditional buildout.
🔍 THE BOTTOM LINE
The AI industry spent a record sum and lost the framing fight: data centres went from invisible infrastructure to a ballot-box symbol of concentrated power and rising power bills. The buildout will continue, but from now on it buys permission, watt by watt, community by community — and the first full election on those terms went against it almost everywhere.
📰 Sources
- CNBC — Elon Musk’s record election bet backfired
- Fast Company — Midterm elections 2026: AI data centers could decide races in these states
- NBC News — Ballot Measures 2026: Live U.S. Midterm Election Results
- Ballotpedia — Voters in ten states will vote on data center-related ballot measures November 3
- MultiState — Data Center Ballot Measures: 28 Localities Vote in November
