Minneapolis Approves Six Month Moratorium on Large Data Centers

May 26, 2026 – Minneapolis has enacted a six-month moratorium on certain new data center developments after the City Council voted 8-5 Thursday.

The moratorium will halt approvals while officials study the facilities’ potential effects on energy consumption, water use, noise and neighborhood impacts.

The measure applies to proposed data centers larger than 350,000 square feet, while allowing smaller facilities to continue moving forward throughout the city’s downtown core.

The pause will give city staff time to evaluate whether additional regulations are needed as demand for artificial intelligence computing infrastructure fuels a nationwide surge in data center construction.

The vote is a part of a debate in communities across the country with local governments weighing the economic benefits of data centers against concerns over their environmental footprint and strain on public infrastructure.

In Maine, a data center moratorium was vetoed by Gov. Janet Mills because it failed to include a carve out for a project in the town of Jay that would bring needed jobs to a community that has struggled since the closure of a local mill.

Supporters of the moratorium in Minneapolis argued the city needs more information before approving large-scale projects. Council Member Jason Chavez said policymakers must address concerns surrounding environmental justice and resource consumption.

“I think this is a conversation that we need to have,” Chavez said, citing concerns about water usage and the broader impact of data center development on surrounding communities.

Opponents of the moratorium warned that the temporary ban could discourage investment at a time when Minneapolis is working to revitalize its downtown economy following years of reduced office occupancy driven by remote work.

Council Member Michael Rainville said he had already heard from residents and stakeholders concerned about the proposal’s economic implications.

“We have to bring our downtowns back, and data centers are gonna be part of it,” Rainville said.

Mayor Jacob Frey also expressed caution about limiting potential redevelopment opportunities. In a statement to local media, Frey said data centers could help attract investment and generate revenue if projects are developed responsibly.

“If a data center helps us recover lost tax base with minimal or no impact on existing water and energy supply, it could help make our city more affordable,” Frey said. “We should not close ourselves off to potential options that are good business.”