Massachusetts Gov. Maura Healey signed an executive order on Sept. 8 that effectively gives cities and towns an early veto over large data center projects. Under the new framework, developers of facilities with maximum electricity demand above 25 megawatts must secure local approval before any state permitting can begin, and they must first negotiate community benefits agreements that align with state standards.
The order also bans non-disclosure agreements between state agencies and data center companies, aiming to keep the review process open to residents. Facilities above 25 megawatts are required to generate their own power and guarantee that it meets the state’s clean energy standards; Healey said data centers will be held to a 100% clean generation requirement. If onsite generation is not feasible, developers can fund new generation nearby or pay into a new Ratepayer Protection Fund.
Healey was blunt about the motivation: “Unless a community says yes to a data center, we’re saying no,” she said at a State House press conference. “We can’t have data centers coming in and taking energy away from the rest of us.” Her administration has until Dec. 31 to create an alternative compliance payment mechanism for centers that do not meet clean electricity standards.
The Massachusetts action follows local backlash, particularly in Lowell, where residents near the Markley Group’s facility reported electric bills climbing more than 50%, with exhaust reaching bedrooms and noise disrupting sleep. Six Massachusetts communities have already banned or paused data centers: Shutesbury and Holyoke have banned them outright, Westfield has a moratorium, and Easthampton, Northampton, and Greenfield are weighing temporary bans.
The move is part of a broader state-level pushback. In Ohio, Amazon’s nearly $40 billion data center buildout is facing a new risk as lawmakers reconsider tax breaks that helped make the state a cloud-computing hub. Amazon has invested nearly $40 billion in Ohio data centers since 2015 and paid almost $11 million in property taxes and fees last year, but the state’s sales-tax exemption for data center equipment cost more than $1.5 billion in 2025 — far above an earlier estimate of about $136 million. Gov. Mike DeWine paused new exemption requests in May while lawmakers review the program, and some legislators want the break repealed or require data centers to cover more grid-upgrade costs.
The wider concern is that more than 10 states are reconsidering similar incentives as electricity, water use and infrastructure costs become political issues. Morgan Stanley’s Ariana Salvatore said “the biggest debate far and away is on data center pushback.” For Amazon, second-quarter AWS revenue rose 37% to $42.2 billion, its fastest growth in 18 quarters, and its AI business exceeded a $25 billion annual revenue run rate. But each additional tax, grid contribution or financing cost raises the return hurdle on new capacity.
Texas and New York have also tightened rules in recent months: Texas requires new facilities to submit to audits by the state utility regulator and ERCOT, and New York paused construction of data centers 50 megawatts or larger in July. Fifteen states are considering moratoriums, according to the National Conference of State Legislatures.
