AI Companies and Building Trades Form Alliance to Fight Data Center Moratoriums

Blackstone, OpenAI, QTS, and SoftBank launched the American Infrastructure Alliance on Monday alongside five major building-trades unions, creating the first formal coalition of AI industry players and organized labor specifically organized to fight state data center moratoriums — an accelerating legislative phenomenon that has blocked an estimated $198 billion in data center investment in the United States during the first half of 2026.

The coalition's five union partners — the International Brotherhood of Electrical Workers, the United Association of Union Plumbers and Pipefitters, the International Association of Sheet Metal, Air, Rail and Transportation Workers, the International Association of Heat and Frost Insulators and Allied Workers, and the International Association of Iron Workers — represent the construction trades that build, wire, cool, and insulate data centers. Their participation fundamentally changes the political texture of industry advocacy. Until now, opposition to data center moratoriums came primarily from corporations and developers. Now it carries an IBEW card.

The Alliance's stated goal is not simply to defeat moratoriums. It is to work with state legislators in seven target states — Texas, Georgia, Ohio, Iowa, Pennsylvania, Indiana, and South Carolina — to establish clear regulatory standards for data center development before 2027 legislative sessions convene. That distinction matters. The coalition is not asking states to step back entirely from data center regulation; it is asking them to adopt predictable rules rather than blanket bans.

A $198 Billion Problem That Grew From the Grass Roots

Data center moratoriums did not arrive as a top-down federal policy. They emerged from local planning boards, county commissions, utility regulators, and state legislatures responding to genuine constituent concerns: power costs absorbed by existing utility ratepayers, groundwater consumption by evaporative cooling systems, truck traffic, noise, habitat disruption, and the perception that large technology companies were extracting subsidies while leaving communities with industrial burdens.

Data Center Watch, an industry tracking organization, counted 843 active opposition groups across 49 states as of mid-2026. The organization's first-half 2026 data identified approximately 75 blocked or significantly delayed projects in the first quarter alone, representing roughly $130 billion in halted capital investment. A second wave of 45 projects worth approximately $68 billion followed in the second quarter. Both figures are organization-reported and represent announced projects that developers have publicly acknowledged are stalled; the actual number of projects quietly abandoned or relocated is likely higher.

The political strength of the opposition reflects a structural problem with how data centers entered communities. Developers frequently negotiated direct arrangements with utilities or state agencies, leaving local governments with limited control. In many states, large-load customers — data centers being the clearest current example — triggered grid upgrade costs that were spread across the ratepayer base under state utility commission rules derived from the Public Utility Regulatory Policies Act of 1978. PURPA governs how states allocate interconnection and infrastructure upgrade costs, and in many jurisdictions, the answer has been: bill the existing customers.

When a school district's electricity bill rises because a hyperscale data center required a new substation and the costs were socialized to all ratepayers, "data center moratorium" becomes a popular policy with real constituents. A Gallup poll conducted in March 2026 found 71 percent of Americans opposed to building AI data centers in their local area, with majorities across partisan lines — including 77 percent of Democrats, 74 percent of independents, and 63 percent of Republicans. That kind of broad, cross-partisan opposition is unusually durable in state legislatures.

Texas Shows How Fast a Permissive Environment Can Reverse

The Texas case demonstrates precisely why the Alliance is focused on creating standards before 2027 sessions rather than fighting individual battles after they open.

Texas had been among the most permissive US states for data center development — offering tax abatements, abundant land, growing power supply, and a business-friendly regulatory environment. The state's ERCOT grid operates as an island, independent of the Eastern and Western Interconnections, giving Texas utilities and regulators distinctive authority over interconnection decisions. That insularity proved to be a two-edged asset when data center load growth became a salient political issue.

Governor Greg Abbott's administration executed four escalating regulatory actions between June and September 2026. On June 10, a directive addressed cost-funding rules for data center grid connections, requiring data centers to fully fund the costs of the electric infrastructure needed to serve their operations. On August 3, following concerns about interconnection queue management, the governor directed ERCOT and the Public Utility Commission of Texas to audit how data center load forecasts had been incorporated into interconnection planning — raising the prospect of retroactive interconnection reviews.

On September 14, the Texas Water Development Board received a directive requiring data centers above a threshold size to report water consumption to the state, addressing the freshwater use concerns associated with evaporative cooling. Then, on September 21, Abbott directed the Texas Commission on Environmental Quality to halt all pending environmental permit applications for new data centers until ERCOT completes its audit. A state that twelve months earlier was competing to attract hyperscale data center investment had, in the space of one legislative quarter, frozen environmental approvals for new construction.

No single Abbott action amounts to a permanent moratorium. Collectively, however, they demonstrate how a governor who remains broadly supportive of economic development can nonetheless create effective blockage through sequential regulatory actions at the utility, water, and environmental layers — without ever passing a single piece of legislation.

Why Unions Change the Political Calculation

The political vulnerability of pure industry advocacy is that legislators in manufacturing-heavy swing states hear "AI company CEO" and think "tech billionaire asking for my help." They hear "IBEW business manager" and think "constituent who votes in my primary."

IBEW President Kenneth Cooper made the coalition's political logic explicit in the launch statement: "Blanket bans on necessary infrastructure projects would set back our economy and threaten good middle-class jobs. The IBEW is committed to responsible development that benefits workers, communities and our nation." That framing is designed to operate in places like Ohio, Pennsylvania, and Iowa — states where union density remains meaningful, where data center construction represents tangible employment, and where "protecting good middle-class jobs" is a legislative consensus that spans party lines.

Mark McManus, general president of the United Association of Union Plumbers and Pipefitters, framed the coalition as a path to responsible development: "We are proud to join this coalition to chart a clear path forward, so that UA members can continue to protect the health of the nation." Michael Coleman of SMART emphasized community standing: "American workers and communities should have a seat at the table as this critical infrastructure is built."

These five unions are not peripheral to data center construction. IBEW members wire the power distribution systems, install switchgear and transformers, and run fiber. UA members install cooling systems, plumbing, and fire suppression. SMART members fabricate and install HVAC and ductwork for building cooling systems. HFIAW members insulate mechanical systems and piping. Iron workers erect structural steel for the buildings themselves. Excluding union labor from data center advocacy left a significant political asset on the table; the Alliance's formation corrects that.

The political playbook mirrors the approach building trades used during the CHIPS and Science Act (2022) and the Infrastructure Investment and Jobs Act (2021), where organized labor provided congressional credibility for large industrial investments in manufacturing-sensitive districts. In both cases, the union imprimatur helped move wavering legislators who were otherwise reluctant to vote for bills perceived as corporate giveaways.

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The Federal Stalemate That Made the State Coalition Necessary

The Alliance's formation coincides with the collapse of federal legislative relief. The Ratepayer Protection Act (H.R. 9340), which sought to clarify PURPA cost-allocation standards to prevent large-load grid upgrade costs from being passed to existing ratepayers, passed the House on September 16 by a 417-3 margin — a level of bipartisan support that is functionally unanimous.

One day later, the bill stalled in the Senate when Senator Martin Heinrich of New Mexico objected to a unanimous consent request to pass the bill without a recorded vote. Heinrich argued the legislation did not go far enough because it would only require states to consider mandating that data centers cover grid upgrade costs, rather than requiring them to do so outright. He proposed his own alternative, the GRID Savings Act of 2026, which would have given the Federal Energy Regulatory Commission direct rulemaking authority over facilities drawing 150 megawatts or more. Senator Bernie Moreno of Ohio then objected to Heinrich's proposal in turn. With the Senate set to leave Washington ahead of November's midterm elections, the Ratepayer Protection Act is unlikely to advance before the session ends.

The combination — near-unanimous House passage followed by immediate Senate failure — left state-level cost-allocation disputes in an unresolved federal limbo. Without PURPA clarification, the ratepayer-harm argument available to moratorium supporters in state legislatures remains intact and legally grounded.

Senator Bernie Sanders and Representative Alexandria Ocasio-Cortez introduced the Artificial Intelligence Data Center Moratorium Act in the Senate on March 25, 2026, with a House companion bill following on June 26. The legislation would impose a federal moratorium on new large data center construction pending environmental review and passage of AI safeguard legislation, and while it has not advanced to a floor vote, its introduction created rhetorical ammunition for state-level moratorium advocates.

Virginia's trajectory reinforces the urgency. Governor Abigail Spanberger signed Executive Order 22 on September 18, launching the Virginia Data Center Accountability Framework — the most sweeping executive action on data center development in the state's history, setting new requirements on community transparency, environmental protection, ratepayer affordability, clean energy, and workforce standards. The same day Prince William County's board of supervisors voted unanimously to end by-right data center development countywide, a decision requiring all future data center projects in the county to receive specific board approval. Virginia is the largest data center market in the world by capacity; its movement toward tighter oversight signals that no state is politically immune.

"Clear Standards" as the Alliance's Real Goal

Blackstone's position in the coalition deserves particular attention. The private equity firm owns QTS Realty Trust, one of the largest US data center REITs, having taken it private in a $10 billion acquisition in 2021. Blackstone's infrastructure and real estate funds have committed tens of billions of dollars to data center expansion globally. The company's involvement is therefore not primarily about protecting future development options — it is about protecting existing capital already deployed in jurisdictions where regulatory environments are shifting beneath it.

QTS Co-CEO Tag Greason articulated the coalition's strategic framing with notable precision: "Responsible growth requires clear expectations for everyone involved." That language is worth unpacking, because it is not deregulatory — it is regulatory-clarity-seeking.

The pre-2024 posture of the data center industry assumed that permissive state and local environments were sufficient for buildout: land was available, power was available, regulation was minimal, and developers could move quickly. That model has broken down. The $198 billion in blocked investment and the 843 opposition groups represent the political cost of development that outpaced regulatory frameworks.

The Alliance's proposal — clear state-level standards covering power costs, job commitments, tax revenue, water use caps, and community engagement processes — represents a strategic pivot. Industry is now seeking the predictability of explicit regulatory frameworks over the uncertainty of opposition-driven case-by-case battles. This is a meaningful shift: it acknowledges that the post-2020 hyperscale development model, which assumed permissive unregulated access as the baseline, is no longer politically sustainable.

The coalition's own polling in Ohio illustrates why this reframing is plausible. Before exposure to any developer commitments, 67 percent of Ohio respondents held unfavorable views of data center development. When developers committed explicitly to low power costs for consumers, local job creation, and tax revenue contributions, the number flipped to majority favorable. The methodology is coalition-commissioned and should be treated as a claimed finding rather than independent evidence, but its directional implication — that opposition is contingent on perceived equity, not irreversible — is consistent with the Gallup polling and with the structural logic of NIMBY opposition generally.

What the 2027 Window Means and What Remains Uncertain

State legislative sessions in the seven target states open between January and March 2027. The Alliance's stated goal is to reach those sessions with pre-negotiated framework legislation — standards that legislators can adopt as an alternative to moratoriums rather than a choice between unbounded development and complete prohibition.

Whether that strategy succeeds depends on factors the coalition cannot fully control. In Texas, the Abbott administration's willingness to engage on "clear standards" rather than continuing regulatory escalation is uncertain. In Ohio, Pennsylvania, and Iowa, the strength of building-trades union relationships with individual legislators varies district by district. In Georgia, Indiana, and South Carolina, the absence of strong union political infrastructure makes the organizing logic less straightforward.

The Senate's failure to advance the Ratepayer Protection Act also leaves the most durable ratepayer-harm argument legally intact. Even with union backing, state-level legislators face constituents whose utility bills reflect real data center load costs — and those constituents vote. The coalition's "clear standards" proposal will need to include credible cost-allocation commitments to neutralize that argument. Critically, those commitments must specify who bears grid upgrade costs when a large data center requires new substation or transmission infrastructure — the precise question that the Senate failed to resolve at the federal level last week. The details of those commitments have not been publicly specified in the Alliance's launch materials, and their eventual content will determine whether state legislators treat the coalition's framework bills as genuine policy solutions or as diluted alternatives to effective moratoriums.

What is clearer is that the AI industry has recognized the political sustainability problem and made a significant strategic bet on its resolution. The American Infrastructure Alliance is the most ambitious organized attempt yet to convert the construction workforce's interest in data center growth into a legislative counterweight to the community-impact opposition that has driven the moratorium wave. Its outcome will shape where — and whether — the next generation of US AI infrastructure gets built.