San Jose city officials have chosen to advance new development standards for data centers rather than implementing a temporary halt, a different approach compared to several other California cities that have approved moratoriums this month. This week, the San Jose City Council voted 8-0 to uphold planning staff approval for a new data center within an existing research and office building at 300 Holger Way in North San Jose, rejecting an appeal.
The City Council's decision reflects a focus on permanent rules for data center growth. Draft uniform standards for data centers and large energy-use projects (those consuming 20 megawatts or more) are set for review by the Planning Commission in mid-November. Following this, the City Council will hold hearings and a final vote in December. The public has been advised that any feedback submitted after October 22 will not be included in official staff reports for the November 18 and December 8 meetings, though residents can still participate, submit letters, and provide testimony directly during the live Planning Commission and City Council sessions.
In Santa Clara, city officials also opted against a moratorium vote. Instead, they are moving forward with new rules to govern data center development, which include more stringent regulations concerning water use and air pollution.
This local policy direction in San Jose and Santa Clara stands in contrast to actions taken elsewhere in the region and state. In the first half of October, Oakland’s city council unanimously approved a 45-day moratorium on new data center approvals, making it the first city in Alameda County and the fourth in the Bay Area to adopt such a measure. San Francisco approved a similar moratorium this month. The Los Angeles County Board of Supervisors postponed a vote to permanently ban large-scale data centers, also known as hyperscale facilities, on unincorporated land after receiving significant public feedback.
Further south, the Gilroy City Council enacted a 45-day temporary moratorium on new data centers in September, which it later voted to extend this month. This extension aims to allow time to study and establish objective zoning, water, noise, and energy standards. The ban currently halts new applications and stops a proposed second large Amazon data center project that is in the pre-application stage near Highway 152 and Camino Arroyo.
California currently has the third-highest data center density among U.S. states, with 366 facilities either operational, under construction, or in planning. Across the state, at least 26 resolutions, moratoriums, or bans on data center development have been passed or proposed since June, according to the non-governmental organization Food & Water Watch. This growing local opposition highlights a gap between state-level regulation and municipal action.
Last month, Governor Gavin Newsom signed into law seven new state measures primarily focused on disclosure requirements, environmental impact studies, and grid protection for data centers. However, grassroots groups and city councils are moving to halt construction entirely. Nicole Ghio, California Director at Food & Water Watch, noted the rapid spread of opposition, stating, “Hold on, let’s press pause. Let’s actually figure out what we’re doing before we commit to this huge change.”
Opponents of data center expansion express concerns that these energy-intensive facilities strain power grids, could deplete water supplies, pollute the air, and contribute to broader economic anxieties linked to AI-driven job displacement. They also point to potential rate hikes for residents and environmental degradation. The movement against data centers is noted to cross party lines, with calls for local control and additional environmental and consumer protections.
Conversely, industry proponents argue that stopping such infrastructure development risks national interests. Doug Kelly, CEO of the American Edge Project, described the current buildout as an essential infrastructure race, comparing artificial intelligence and the data centers that power it to historical investments in railroads and highways. While acknowledging past developments sometimes lacked sufficient community input, Kelly’s organization promotes an “AI Community Compact.” This proposed agreement offers local guarantees to protect ratepayers from cost spikes, safeguard resources, and promise early transparency. Kelly suggested communities should avoid blanket bans to retain negotiating power for potential investments.
Advocates for stricter local control, however, believe that piecemeal guarantees and disclosure laws may not be sufficient to address the underlying risks. They often reference a one-year pause on hyperscale data centers ordered by New York’s governor in July as a potential roadmap for state legislators to follow local leaders. As cities across California continue to consider temporary freezes and outright bans, the balance between local community control and technological expansion remains a key discussion. State transparency laws have increased visibility into data center growth, but local groups are making it clear that understanding the plans does not equate to approving them.
