Massachusetts Forces AI Infrastructure to Face Grid Reality
AI-generated image · US National Wire
A new executive order from Gov. Maura Healey ends the era of easy incentives, requiring large data centers to provide their own 100% clean power.
For years, the playbook for data center developers was simple: find the state offering the most incentives and build. But as the AI boom puts unprecedented pressure on the grid, Massachusetts is signaling that the honeymoon is over.
As TechCrunch first reported, Gov. Maura Healey has issued an executive order that effectively treats large-scale data centers as industrial power plants. Under the new mandate, any developer building a facility with a peak demand larger than 25 megawatts must now provide their own power and ensure it meets the state's clean energy requirements.
While state law generally allows industry to meet clean energy standards through a sliding scale—such as requiring approved sources like wind, solar, and hydro to contribute at least 40% of total power by 2030—the governor's office has clarified a much stricter bar for these facilities. The governor's office specified that these data centers must fulfill all of their electricity needs through clean energy generation.
Gov. Healey's preference is for this power to be generated on-site. If developers cannot achieve this, they are faced with two options: fund the construction of new nearby generation or pay into a ratepayer protection fund. In a move to increase transparency, the executive order also directs local communities to avoid signing non-disclosure agreements with developers. To ensure regulators have the necessary time to implement these rules, the governor is pausing applications for a a data center sales tax exemption that had only just gone into effect last month.
Massachusetts is not alone in this pivot. TechCrunch notes that it is the third state in three months to tighten the leash on data center growth. In July, the governor of New York halted the construction of new facilities measuring 50 megawatts or larger. In August, Texas Governor Greg Abbott announced that all new data centers in his state must undergo audits by the grid operator, ERCOT, and the public utility commission.
As political will shifts toward protecting the grid and ratepayers, the industry is fighting back. TechCrunch reports that Leading the Future—a pro-AI super PAC funded by Greg Brockman, Ben Horowitz, and Marc Andreessen—is currently purchasing advertisements in battleground states to influence voters ahead of the midterm elections.