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SF approves data center moratorium, other Bay Area cities reviewing policies
San Francisco on Tuesday approved a 45 day moratorium on new data center construction; Oakland is considering a similar ban. The City of Santa Clara, which already has 56 data centers, is launching a review of its regulations.
SANTA CLARA, Calif. - As artificial intelligence and digital services rapidly expand, several California local governments are stepping back to evaluate the footprint of data center development in their communities.
Cities across the Bay Area and Southern California are considering pauses or reviewing long-standing policies to address rising concerns over energy demand, water usage, and environmental impacts.
High demand prompts policy evaluation
The City of Santa Clara stands as one of California's primary data center hubs. Despite its population of roughly 133,000 residents, Santa Clara currently hosts 56 data centers, with two additional projects in development.
The industry has proven highly lucrative for Santa Clara, contributing $35 million annually in taxes directly into the city's general fund. However, high power demand prompted the city's municipal utility, Silicon Valley Power, to stop accepting new data center applications in 2023. Santa Clara officials are launching a year-long interdepartmental review of environmental, water, power, and quality-of-life impacts before updating local development rules.
Regional moratoriums and community pushback
Local perspective:
In Oakland, City Council members are considering a 45-day temporary moratorium on new data center construction. Protesters gathered at Oakland City Hall ahead of a council vote scheduled for Tuesday night to voice concerns about local neighborhood impacts, high water consumption, and energy efficiency.
Similarly, San Francisco supervisors unanimously approved a 45-day moratorium on data center approvals, declaring an immediate threat to public health, safety, and welfare without comprehensive regulations in place. Supervisor Shamann Walton noted the pause allows the city time to study energy, water, air quality, land use, and community effects.
Meanwhile, Southern California is taking a similar approach. The Los Angeles County Board of Supervisors received a proposal to permanently ban massive "hyperscale" data centers—frequently built to support resource-intensive AI workloads—while leaving allowances for smaller operations.