As the world's biggest technology companies race to build data centers across the country to power an AI boom, a yearlong Senate investigation argues that some firms are misleading the public about the true costs and benefits around those projects.
The findings, first shared with TIME, are expected to be part of a broader effort in the coming year by members of Congress hoping to put more guardrails around the massive, power-intensive projects.
“Congress must hold Big Tech accountable so these companies pay their fair share,” says Senator Elizabeth Warren, a Massachusetts Democrat who has called for a national moratorium on new AI data centers until developers agree to cover the full costs.
Warren's office led the investigation with fellow Democratic Senators Chris Van Hollen of Maryland and Richard Blumenthal of Connecticut, which focused on seven major data center developers—Amazon, Google, Meta, Microsoft, CoreWeave, Digital Realty, and Equinix. The senators’ staff requested information from each company and interviewed employees.
The findings, which largely match reporting from various news outlets over the past year, offer a detailed look at the increasingly contentious economics of the AI buildout. Data center companies routinely point to construction employment when making the case for incentives. But when the senators’ staff asked for comprehensive information about permanent employment, several of the companies refused to provide it, according to the report. Some companies told investigators that permanent staffing was roughly one worker for every megawatt of power demand. A 100-megawatt data center, by that measure, could consume roughly as much electricity as 100,000 homes while employing about 100 permanent workers after construction.
“This report lays bare what we have long known: working Americans and local communities are footing the bill for Big Tech’s massive expansion of data centers, while these companies continue to operate without transparency,” Van Hollen says.
Notably, the Senate investigators found that the most lucrative incentives for data center developers are not necessarily the attention-grabbing property-tax breaks, but sales-tax exemptions on computer equipment. AI facilities require vast quantities of specialized hardware, and GPUs account for an estimated 39% of the spending at an average 1-gigawatt AI data center, according to the report.
All four of the major technology companies in the investigation—Amazon, Google, Meta and Microsoft—have routinely sought nondisclosure agreements during data center development, according to the report. Some acknowledged requesting them from government officials. While data center negotiations often deal with commercially sensitive information, the Senate report argues that NDAs have also restricted public scrutiny of deals involving tax dollars, utility rates, and public infrastructure.
Microsoft told the investigators it would stop seeking NDAs with local governments, although it would continue using them with state agencies, public utility commissions and utilities. Amazon has announced a similar policy. Google and Meta declined to commit to ending the practice with local governments, according to the report.
The report comes as data centers have become a hot-button issue on the campaign trail. About half of Americans say that data center construction is bad for the country, according to a recent Economist/YouGov poll. Both parties have been harnessing the issue, even as President Trump warns that opposition to data centers could push the AI buildout overseas.
A significant portion of the report explores whether tech companies are paying their fair share for data centers that are driving up the costs for nearby homeowners and businesses. State regulators and lawmakers are increasingly being asked to decide how much of that expansion should be paid for by the companies driving the demand, and how much should be borne by other customers and taxpayers.
The Senate investigators found none of the seven companies would agree to a standard that would require them to pay for the building of new power infrastructure that would not have been needed if not for their data centers. The companies generally said they would pay the direct costs of serving their data centers, but argued that larger investments in the electric grid—like new power plants and transmission lines—can benefit other customers and should not automatically be assigned to the company that helped drive the need for them.
The report points to a power plant in Richland Parish, Louisiana, that the local utility provider, Entergy, has sought to buy. Analysts argue the purchase was driven primarily by Meta’s planned $50 billion data center, which is expected to draw 4,500 megawatts of electricity—about four times the peak electricity demand of the entire city of New Orleans. Estimates indicate that the purchase could drive up electric bills for the average Entergy customer by $8-13 per month. Meta has disputed that its project is responsible for the costs.
When Congress reconvenes after the midterm elections, data centers will be among the issues waiting for them. In September, the House overwhelmingly passed the bipartisan Ratepayer Protection Act, 417-3, which would direct states to consider standards requiring large-load customers such as data centers to cover the incremental costs of the generation, transmission, and distribution infrastructure needed to serve them.
But the measure stalled in the Senate, as Democrats argued it was toothless because it didn’t require states to push any costs to the companies. The Senate ultimately voted 57-43 against advancing the bill.
Much of the authority over electricity rates remains with state regulators, which means the biggest fights will continue to play out in statehouses and public utility commissions. But the Senate investigation gives Congress a new set of findings to work with as lawmakers consider whether federal standards should govern large electricity users, transparency around data center deals and the public subsidies supporting the industry’s expansion.
Van Hollen said Congress needs to pass a bill “that ensures that the corporations building and running data centers cover the costs of the energy they need, instead of pushing those costs onto the backs of consumers.”
