The artificial intelligence boom has sparked an unlikely legal battle: corporations arguing that data centers deserve protection from what they characterize as discriminatory treatment. As communities across the country resist the massive infrastructure projects, the industry is fighting back with claims that opposition unfairly singles them out.
The tension centers on real costs borne by ordinary people. Data centers now consume 6% of electricity supply in the United States and United Kingdom combined, a figure expected to climb above 14% of total US power demand by 2030. American utilities sought nearly thirty billion dollars in retail rate increases during the first half of 2025 alone. Power prices on the largest electric grid in the US jumped 76% in the first quarter due to surging data center demand, according to recent reporting.
Beyond electricity bills, communities face direct resource depletion. Residents in Fayetteville, Georgia discovered that a nearby data center had consumed 30 million gallons of water without initially paying for it. Low water pressure became the red flag that exposed the operation. A new Gallup poll found that seven in 10 Americans oppose constructing AI data centers in their local area, with most saying they would rather live adjacent to a nuclear power plant.
Industry leaders have shown little concern about these impacts. OpenAI CEO Sam Altman, when asked about the scale of data centers his company was building, offered a vague shrug. "I do guess a lot of the world gets covered in datacenters over time," he said on a podcast, adding that he might even consider putting them in space. The dismissal is typical of Silicon Valley's approach: those reaping billions from AI expansion will never face the noise, pollution, and resource drain in their own neighborhoods.
As resistance grows, the industry's legal strategy is hardening. A University of Michigan proposal for a 1.2 billion dollar nuclear weapons research and AI data center in Ypsilanti Township triggered local officials to vote for a year-long moratorium on water and sewer services while environmental impact studies were conducted. The university responded by claiming the moratorium was unlawful discrimination against data centers, arguing it singled them out "by label rather than by utility impact."
This language reflects a broader trend in corporate America. Over the past century, US law has steadily expanded rights afforded to corporations. The Supreme Court's 2010 Citizens United ruling granted corporations rights to political speech. The 2014 Hobby Lobby decision allowed companies religious exemptions from health care requirements. Most recently, the 2023 303 Creative ruling permitted a website design business to refuse service to same-sex couples based on the owner's religious beliefs.
Each ruling elevated corporate personhood at the expense of actual people's rights. The Brennan Center for Justice warned at the time of Hobby Lobby that the country faced "a continued trend of corporations successfully asserting the rights of human beings, while injuring the interests of actual human beings."
The data center legal strategy follows this playbook. By framing local opposition as discrimination, the industry hopes to weaponize civil rights language against communities protecting their own interests. It is an inversion that redefines victimhood: the multi-billion dollar corporations become the persecuted, while residents facing higher utility bills and depleted water supplies become oppressors.
If the legal precedent holds, data centers could soon claim the same speech and religious freedoms as other corporations. Given the trajectory of corporate personhood in American courts, it may not be long before a data center's claimed right to expand exceeds a community's right to make decisions about its own resources.
Author James Rodriguez: "The irony is thick: corporations worth hundreds of billions are now casting themselves as victims of discrimination, while ordinary Americans foot the bill for their power consumption and watch their communities drained of water."
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