April 2026 Blog | onCORE Origination
Data centers have quickly evolved from invisible infrastructure to a leading topic in economic development. As artificial intelligence, cloud computing, and digital services accelerate, their physical backbone is increasingly visible. Communities, utilities, and developers nationwide are reassessing the impact of data centers on land use, energy demand, and economic value.
At onCORE Origination, we work where land, infrastructure, and energy meet. Data centers offer major opportunities for modern infrastructure, but many misunderstand them.
The scale of growth alone is reshaping the conversation. According to JLL’s 2026 Global Data Center Outlook, global capacity is expected to nearly double by 2030, driven largely by artificial intelligence workloads. This surge is not incremental; it represents a massive infrastructure buildout, with trillions of dollars expected to be deployed over the next five years. The United States is at the center of that expansion, already home to thousands of operating facilities with thousands more in development.
With that kind of momentum, it’s no surprise that public scrutiny is increasing. Recent reporting by the Harvard Gazette highlights growing community concerns about energy consumption, water use, and the broader impact of data centers on local economies. In many cases, these concerns are valid. Large-scale facilities can require substantial power, and projections suggest data centers could account for a meaningful share of total U.S. electricity demand in the near future. Communities are right to ask whether infrastructure can keep up and how costs will be allocated, but where the conversation often breaks down is in the leap from concern to conclusion.
Take job creation, one of the most common points of criticism. There is a perception that data centers do not deliver meaningful employment, particularly once operational. While it’s true that these facilities are not labor-intensive in the traditional sense, that does not mean they lack economic impact. Construction phases generate significant demand for skilled labor, often over multi-year timelines.
Once operational, data centers support highly specialized roles like technicians, electricians, security personnel, and facility managers, many of which are well-paying and stable. Industry analysis has also shown that each direct job can support multiple indirect jobs in the surrounding economy, extending the impact well beyond the facility itself.
Another frequent concern is reliability. The assumption is that large energy users will strain the grid and increase the likelihood of outages. However, the relationship between data centers and the grid is more complex. These projects undergo rigorous interconnection studies and often participate in demand response programs, enabling them to reduce consumption during periods of grid stress.
Additionally, developers often fund infrastructure upgrades, including substations, transmission improvements, and grid modernization, benefiting the broader region. As highlighted in industry discussions such as Heartland Energy’s “fact vs. fiction” analysis, properly structured data center projects can enhance grid resilience rather than weaken it.
Environmental impact is another area where perception and reality diverge. There is no question that data centers require significant energy and, in some cases, water for cooling.
However, the industry has been evolving rapidly to address these challenges. Many of the largest operators are now among the world’s leading purchasers of renewable energy, investing heavily in solar, wind, and battery storage solutions.
Advances in cooling technologies are also reducing water consumption, with some facilities using recycled water or closed-loop systems that dramatically limit freshwater use. As Dean Nelson notes in his work on digital infrastructure, responsible data center development is increasingly focused on efficiency, sustainability, and long-term integration with local communities. For example, one of our clients’ are developing closed-loop systems that reduce water consumption by 80% compared to traditional hyperscale datacenters, leading to water usage about equivalent to the local laundromat.
Location is another misconception that persists. While Northern Virginia remains the largest data center hub globally, development is no longer confined to major metropolitan areas. Increasingly, projects are being sited in secondary and tertiary markets where land is available, power can be accessed or expanded, and permitting timelines are more favorable. This shift presents real opportunities for smaller communities, but it also raises the stakes. Site selection is no longer just about land; it is about aligning infrastructure, transmission access, and long-term planning.
Perhaps the most debated issue is economic benefit. Critics often argue that tax incentives dilute the value data centers bring to local communities, and there is truth to the idea that poorly structured deals can limit public upside. The Harvard Gazette notes that in some regions, aggressive tax breaks have reduced municipalities’ net fiscal benefits. At the same time, data centers can generate substantial property tax revenue and provide long-term financial stability when structured correctly.
They also attract complementary investment, such as fiber, substations, and road improvements, that can support broader economic growth. The difference, ultimately, comes down to execution.
The future of data centers depends on balance, not unchecked growth, or outright opposition. Communities demand clear data on power, water, and value. Developers must match projects to grid capacity and long-term strategies. Utilities now shape how large loads integrate.
In order for the US to keep up globally from an economic, technologic and military standpoint, it is critical for the US to have world-leading datacenter infrastructure. The key is to figure out how to scale datacenter development responsibly and for communities to educate themselves and embrace responsibly-sited datacenters.
At onCORE, this is where we focus. One of our mantras is we develop “Triple Net Positive” projects – these are projects that benefit all stakeholders, from the landowner to the developer to the community. At the end of the day, these projects are long-term infrastructure decisions that require coordination across multiple stakeholders. The success of a project depends on getting the fundamentals right early: proximity to substations, access to transmission, realistic power timelines, and alignment with community priorities. When those elements are in place, data centers can be additive. When they are not, friction is inevitable.
The reality is data centers are arriving at scale, and communities must decide how to respond. The most successful outcomes will arise from informed decision-making, a clear understanding of both risks and opportunities, and disciplined, transparent project structuring.
Data centers are not a silver bullet, nor are they a threat to be dismissed outright. They are essential infrastructure in a digital economy, but their impact depends on thoughtful development. The key takeaway: Responsible growth requires balancing benefits and risks, and success will go to those who build with this balance in mind.
Sources
- Harvard Gazette, Why are communities pushing back against data centers? (April 9, 2026)
- JLL, 2026 Global Data Center Outlook
- Heartland Energy, Data Centers: Fact vs. Fiction (June 27, 2025)
- Dean Nelson, Growth, Power, and Promise: The Facts About Data Centers (Nov 11, 2025)
Joe Tassone Jr. is the founder and a principal of onCORE Origination with 30 years of project development experience and an expert in renewable energy development. Visit www.oncoreorig.com for more information.