The Maine Legislature recently passed L.D. 307, temporarily pausing construction of new large data centers until November 1, 2027. If signed into law by Governor Mills, the act would represent the first state-wide data center ban in the United States. Maine’s legislation responded to political and public questions over electricity prices, overall grid reliability, and expanding development. The 18-month development pause is intended to provide the legislature time to consider potential regulatory or legislative adjustments to address increasing demand. The bill also comes as some states—including Maine—may face challenges meeting greenhouse gas (GHG) and renewable energy targets amid increased overall power demand, including from data centers.
What Maine’s Law Does—And Doesn’t Do
L.D. 307 would prohibit municipalities and state agencies from permitting any data center with a load of 20 MW or greater until November 1, 2027. While temporary, the law would impose an outright statewide moratorium on new large data centers. The law defines “data center” to include any freestanding structure or facility within a larger structure that primarily contains electronic equipment used to process, store, and transmit digital information and that uses environmental control equipment to maintain the proper conditions for the operation of electronic equipment.
The law would also establish the “Maine Data Center Coordination Council,” tasked with creating a study on data center siting in Maine and with the “goals of protecting ratepayers, maintaining electric grid reliability, minimizing environmental impacts and enabling responsible and appropriately sited economic development.” Notably, the bill also tasks the Council with reviewing Maine’s GHG reduction objectives and submitting a strategy report to the Governor. That report, due several months before the moratorium expires, will include the findings of the Council’s evaluation and any recommendations, including “any proposed legislation.”
The law does not include an exemption for a proposed project at a former paper mill in Jay, Maine. Previously, the Governor had indicated that she could not sign the bill without that exemption, as the development would provide much-needed jobs and facilitate beneficial reuse of the property. The requested exemption highlights the complexity of data center development, as proposed projects may offer an opportunity to activate contaminated or underutilized properties that were not previously commercially attractive to developers.
Power Supply & Economic Implications
Maine, like many states, is evaluating the potential increase in data center development and its related potential impacts to power prices, supply, and grid reliability, in addition to implications for GHG reduction targets, land use, air emissions, and other community issues—all while balancing potential economic benefits.
In addition, in Maine and much of the northeast, both electric and natural gas transmission capacity is limited, creating a potential crunch for energy resources. At the same time, data centers can, in some instances, utilize stranded renewable energy, contribute to grid upgrade and maintenance costs, or assist with peak power demand by curtailing or even providing power to the grid.
Governor Mills may well veto the bill. While Mills may share some of the legislature’s concerns, she has often taken a careful approach to economic development issues. But regardless of whether the law stands in Maine, it has lessons for the rest of the country.
What’s Next
Maine is not alone in its efforts to slow data center development. At least twelve other states are also considering temporary data center bans, and several others are exploring or drafting proposals. At the local level, several dozen cities and counties have already enacted their own moratoriums or bans on data center projects. Depending on the jurisdiction, these laws may impose power-based thresholds for applicability (such as Maine’s ban on projects over 20 MW), while others focus on the site square footage or other metrics. At the national level, members of the Congressional Progressive Caucus have introduced a bill to ban new data centers until the passage of federal legislation that imposes restrictions on AI.
This confluence of issues is not unique to Maine: national media has highlighted data center growth in many areas, including “data center alley” in Northern Virginia, with over 250 data centers. Much of this growth occurs in rural areas, where land is more affordable, and there is a thirst for new industry and jobs. Data center projects can support economic development, including remediation of contaminated properties that might otherwise remain dormant, but the increasing number of proposed developments have raised political and consumer questions about strained electricity grids.
Data center developers and other stakeholders should remain attuned to changing regulatory challenges—including the potential for permitting moratoriums—as they consider new projects.
