Data Centers Are Driving Pollution And Power Demand — EVs Can Help
Seven in 10 Americans oppose data centers in their communities — more than oppose nuclear power plants. Only 7% strongly support them, according to a Gallup poll from March. In a country that agrees on almost nothing, that is striking.
Americans’ concerns span community life: water and energy consumption, air pollution, noise, rising utility bills, and land use. The opposition is not about one issue — it is about all of them at once.
The air-quality impact alone is substantial. Some 74 new gas-burning power plants are being built or proposed to power data centers. They will expose surrounding communities to particulate matter and smog-forming nitrogen oxides, pollutants linked to heart disease, asthma, other respiratory illness, lung cancer, strokes and premature death. In Pennsylvania alone, the carbon emissions of just seven of the new plants would be equivalent to the annual emissions from 15 million gasoline-burning cars.
Add to that diesel backup-generator capacity, which nearly tripled between 2018 and 2024. In Virginia, data centers hold permits for roughly 9,000 backup generators. One analysis of a single Virginia facility estimated its permitted emissions could cause as much as $99 million in annual health damages.
And it is all moving fast. In Texas, regulators approved a data-center gas plant large enough to power 300,000 homes in 20 days, another in three days, and a third in two — all without public notice. Meanwhile, the EPA has exempted off-grid data-center power plants from the Acid Rain Program and proposed letting construction begin before air permits are obtained. And it is also proposing the elimination of a federal mandate that states notify the public and seek comment before issuing air pollution permits for data centers and other industrial facilities.
Tax payers are involuntarily subsidizing the build out. States are providing billions in tax breaks— $1.9 billion in Virginia, $2.5 billion in Georgia and $1.6 billion in Ohio.
There Is a Better Approach
Governors are beginning to act. In August, Pennsylvania Governor Josh Shapiro removed data centers from fast-track permitting, required local approval before state reviews, and said developers must pay the full cost of power and grid infrastructure rather than shifting costs to ratepayers. Developers that refuse can lose state tax benefits.
Texas Gov. Greg Abbott has ordered greater scrutiny of projects seeking grid access. New York has imposed a one-year moratorium on new data centers. Kentucky Gov. Andy Beshear signed an executive order to protect Kentuckians “against any harmful impacts from potential data centers.”
California is moving on another part of the equation, authorizing the state to require bidirectional, “Vehicle to Grid(V2G)” capability in new EVs if regulators determine the benefits justify it — an important step toward making the growing EV fleet a grid resource.
Other states should follow these states’ lead. But the surge in electricity demand raises a larger question: how can we use this moment to accelerate the build out of cleaner sources that strengthen the grid for everyone?
Turning America’s EV Fleet Into A Grid Resource
The United States will need more than 230 GW of new generating capacity over the next five years, but utilities are expected to add only about 93 GW. Meeting that challenge will require many solutions. One largely untapped resource is the rapidly growing fleet of EV batteries.
Vehicle-to-grid (V2G )technology allows parked EVs to discharge stored electricity when demand is highest, reducing pressure on the grid and the need for fossil-fuel generation during peak periods. There are more than 7 million EVs on U.S. roads, collectively holding close to 500 gigawatt-hours of battery capacity. Almost none can send power back to the grid yet. Building the infrastructure, programs and vehicle standards now can turn that growing fleet into a major distributed energy resource.
A recent analysis found that enrolling just 10 percent of California’s projected EVs in V2G programs by 2036 could deliver about 9 gigawatts of 12-hour storage — more than a third of the state’s long-duration storage procurement target.
And the opportunity extends far beyond data centers. V2G can provide value wherever the grid faces peak demand — improving reliability, integrating renewable power, reducing the need for some new fossil-fuel generation - and even creating income for EV owners.
EV Owners Can Be Paid For Providing That Power
Massachusetts has extended its ConnectedSolutions program to residential EVs, paying owners roughly $1,250 per year. PG&E is expanding a bidirectional-charging pilot, and one participating company estimates owners could save about $1,300 annually through optimized charging and earn another $3,200 selling electricity during high-price periods. Commercial fleets and electric school buses could offer even greater opportunities.
In Europe, Netherlands, Denmark, Germany, the UK have had on going V2G programs for years. Volkswagen is launching a consumer V2G program in Germany and China has launched a program across nine cities.
But getting V2G to scale remains difficult. Bidirectional chargers, electrical upgrades and interconnection costs can be significant, and approval can take months. Massachusetts is providing its first hundred bidirectional chargers at no cost to help overcome that upfront barrier.
Rewiring America offers a broader model — making EVs, bidirectional charging, solar, battery storage and home electrical upgrades more accessible. What is missing is the infrastructure and funding to scale these approaches.
The Data Center Buildout Can Help Provide It
Instead of giving billions in tax benefits with few conditions attached, states could redirect a portion to help households pay for bidirectional chargers and electrical upgrades, expand distributed battery storage, and build the grid infrastructure needed to use these resources.
Private capital can play a role as well. Investors already pouring billions into new generation for data centers could also invest in V2G infrastructure and companies capable of aggregating thousands of EV batteries into reliable grid resources.
Data-center developers have their own reasons to contribute. A developer who helps fund a grid resource that its neighbors also benefit from offers something a gas turbine cannot — a credible answer at the zoning hearing.
Such financial benefits should extend to already pollution-burdened, lower-income communities that face the impacts data center build out while also facing financial barriers to participating in V2G.
The result could reverse today’s equation: instead of households subsidizing data centers while absorbing their pollution and infrastructure costs, data-center investment could help households enjoy lower energy bills and even get paid for supporting a cleaner grid.
Data centers are not going away. If data centers need enormous amounts of American electricity and billions in public support, their growth should help deliver broader public benefits. But 74 new gas plants, thousands of diesel generators, permits approved in days without public notice, and weakened federal protections — alongside billions in public subsidies— is not a model communities should accept.
Much of the battery capacity to support V2G is already parked in our driveways — and that capacity is growing by the day. Taking advantage of the “window of opportunity” created by the data center build out would benefit both consumers and the air we all breathe.
A rare “win-win” that can lay a foundation for the future.