Maine Governor Janet Mills Vetoes Historic Data Center Moratorium Over Local Economic Concerns

Maine Falls Short of First US State Freeze on Data Centers

Maine nearly became the first state to impose a data center moratorium, but Governor Janet Mills vetoed a bill that would have halted construction of large facilities until November 2027 1

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. The Democratic governor announced her decision on Friday, blocking legislation that had successfully passed through both chambers of the state's Democrat-controlled legislature just days earlier 2

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The vetoed a bill would have frozen approvals for data centers requiring more than 20 megawatts of power while a state-appointed council analyzed their impact on the local grid, electricity bills, air and water 3

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. This would have made Maine the first US state freeze on data centers, creating a significant regulatory hurdle for AI data center expansion at a time when American tech giants have pledged to spend more than $600 billion on artificial intelligence data centers this year 2

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Economic Development Project in Jay Drives Veto Decision

Janet Mills explained that while she supports a temporary moratorium given the environmental and energy impacts of massive data centers in other states, she could not endorse the measure because it failed to include an exemption for a $550 million data center planned for the town of Jay 2

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. The project is slated for the site of the Androscoggin Mill, which shut down in 2023 after a boiler explosion, leading to hundreds of job losses that dealt a devastating blow to the community 3

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The governor estimates the data center construction would create more than 800 construction jobs and at least 100 high-paying permanent jobs, while contributing substantial property tax revenue to Jay, a town of 4,680 people 5

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. Mills, a long-time resident of Franklin County, said she knows well how critical the mill was to generations of working families and how challenging it has been to promote reinvestment and job creation at the former brownfield site 1

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Franklin County commissioners complained in a letter to Mills that the Jay project had been "swept up in the hysteria" around other AI infrastructure projects, even though it would simply tap existing infrastructure at the vacant mill 3

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. The governor had previously asked the legislature to exempt the Jay project from the moratorium, but the carve-out was rejected 3

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Environmental Footprint and Electricity Consumption Concerns Persist

The proposed legislation reflected growing concerns about the environmental footprint and electricity consumption of AI infrastructure. A highly cited December 2024 study from the Department of Energy found that data centers consumed 4.4% of America's energy supply in 2023, with the proportion slated to rise to up to 12% by 2028 5

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. Local activists around the country have expressed worries about soaring utility bills, water shortages, air pollution, and increased local temperatures often associated with these facilities 4

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The bill had called for a diverse group of interested parties, including environmental experts, utility company leaders and tribal representatives, to study land use and other impacts of data centers and recommend legislative guardrails 3

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. Despite the veto, Mills announced she would issue an executive order establishing a council to examine the impact of data centers in Maine and has signed legislation to prohibit data center projects from receiving benefits from business development tax incentive programs 2

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National Push for AI Safety Legislation Faces Federal Resistance

Maine's failed attempt reflects a broader national trend, with at least 11 US states weighing legislation that would halt or restrain development of data center facilities 2

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. States including New York, South Carolina, Georgia, Maryland, Michigan, and Virginia are currently discussing similar moratoriums 1

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. Bernie Sanders and Representative Alexandria Ocasio-Cortez have introduced federal AI safety legislation to halt all data center construction until Congress passes comprehensive regulations 2

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However, the Trump administration has put forth clear policy guidelines stating that "a patchwork of conflicting state laws would undermine American innovation and our ability to lead in the global AI race" 1

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. To ease worries about rising electricity bills, Washington last month secured voluntary pledges from big technology companies that they would bear the cost of new electricity generation to power their data centers 2

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. The veto decision could have political implications for Mills, who is running for US Senate and currently trailing her opponent Graham Platner in polls 4

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. The tension between economic growth, job creation, tax revenue, and environmental concerns will likely shape future state-level responses to the rapid buildout of AI infrastructure across America.