Massachusetts Forces Large Data Centers to Use Clean Power

Under a new executive order issued by Governor Maura Healey, developers building data centers with a peak demand exceeding 25 megawatts must secure clean power to support their operations. The state prefers that these facilities generate their zero-emission electricity on-site. If developers cannot achieve this, they must fund the construction of new local clean energy generation or pay into a state ratepayer protection fund. Additionally, the order pauses applications for a recently enacted data center sales tax exemption to give regulators time to establish these rules, and it advises local municipalities to avoid signing non-disclosure agreements with developers.

While the standard clean energy law in Massachusetts requires industries to source at least 40 percent of their electricity from approved clean sources like wind, solar, and hydro by 2030, the governor's office clarified that data centers face a much stricter threshold. These facilities must cover 100 percent of their electricity demand with clean energy. This aggressive target highlights a growing political shift against the rapid, unchecked expansion of power-hungry computing infrastructure.

Massachusetts is the third state in recent months to restrict data center growth. In July, New York's governor halted the construction of new facilities of 50 megawatts or larger. The following month, Texas Governor Greg Abbott mandated that all new data centers undergo audits by the state's public utility commission and grid operator, ERCOT. In response to this regulatory wave, the tech sector is fighting back. The pro-AI super PAC Leading the Future, backed by prominent tech figures Marc Andreessen, Ben Horowitz, and Greg Brockman, has begun purchasing advertisements to influence voters in key battleground states.

For AI practitioners and infrastructure developers, these shifting policies mean the era of cheap, easily permitted data center construction is drawing to a close. Companies looking to deploy massive clusters must now integrate clean energy procurement directly into their early-stage site selection and financial modeling. Failing to secure dedicated green power assets will significantly drive up capital expenditures through mandatory state fund payments, forcing a strategic shift toward regions with abundant, pre-existing renewable grids.