Maryland County Adopts a Two-year Moratorium on Data Center Development

Maryland’s second largest county is the latest jurisdiction in the state to slam the brakes on data centers.

Prince George’s County on Tuesday adopted a two-year moratorium on development of the server farms, the longest such pause in the state. It is intended to shield residents from the AI boom’s economic and environmental consequences while the County Council drafts comprehensive legislation on zoning, siting and construction of the giant server farms. 

The power-hungry facilities, whose electricity demand has driven utility bills higher, have caused a nationwide push to insulate ordinary ratepayers and businesses from the cost of the energy buildout needed to run them.

The moratorium resolution grew from the work of the county’s Qualified Data Center Task Force, which was formed after a proposal to turn the shuttered Landover Mall into a hyperscale server farm drew protests from residents. 

In its final report, which was delivered in November, the task force recommended that the permitting process include community input, community benefit agreements and zoning that keeps the facilities away from neighborhoods and environmentally sensitive areas.

Tuesday’s vote has made Prince George’s County the most restrictive jurisdiction for data centers across Maryland and latest to join counties including Montgomery, Frederick and Baltimore County that have paused data center development in recent weeks. 

The growing pushback has come at a time when a surge of data center development, riding on the back of the federal push to take the lead in the global AI race, has hiked utility bills and caused states and communities to demand that tech companies pay for their energy needs rather than pushing the costs onto ratepayers at large. Maryland commissioned a study of the industry’s impact on air, water, the Chesapeake Bay and the power grid that is due on Sept. 1.

Krystal Oriadha, the Prince George’s County Council chair, sponsored the resolution and said the two-year pause was a compromise. 

“I support a full ban. That’s what I’ve always supported, and the two-year moratorium was what the council could agree on because there’s varying opinions right now,” she said. 

She said the push to turn the Landover Mall into a data center campus “awakened everyone,” turning a national debate into a local issue as residents understood that such a facility could be “in someone’s backyard.”

Vowing she would continue advocating for a full ban, she said that the council united behind the decision that “no additional project should be moving forward at this time.” Council members shared environmental, economic and ethical concerns, she said.

But Oriadha cautioned that aspects of the data-center boom are beyond the ability of counties or even states to address. 

“This really has to be handled on the national level, because the grid doesn’t know what jurisdiction you’re in,” she said. Prince George’s residents are “paying higher rates because neighboring jurisdictions already have hyperscale data centers,” she said, referring to the data center corridor in neighboring Virginia, part of the same regional electric grid. Data center development, she said, “has to be regulated on the national level to ensure equity and fairness when it comes to the impact across the country.”

David Lapp, who represents residential utility ratepayers as Maryland’s People’s Counsel, said the county moratoriums are buying time.

“Anytime data center development is moved back, it provides more time for us to fill in regulatory gaps that expose regular households to cost impacts of data centers,” Lapp said. Since the rules to protect ratepayers are yet to be written, “moratoriums are useful.”

Regulatory protections are being built on two tracks at once, Lapp noted, but neither is finished. Electric distribution costs fall under the Maryland Public Service Commission, which is drafting data center rules, whereas transmission, capacity and energy costs fall under the purview of federal regulators that have ordered grid operators to propose reforms. Delaying new projects, he argued, “provides more time to lock in those protections.”

Lapp dismissed the framing that an AI arms race justifies moving faster. “You still have this issue of who’s paying for that, and it should not be ordinary households” while the regulation needed to insulate them is still being developed, he said. 

State Sen. Katie Fry Hester, who took the lead role in Maryland’s legislative push on data centers, said there was a fear that the industry is expanding more rapidly than governments can manage it. 

“People are scared because things are happening fast,” said Hester, a Democrat who represents parts of Howard and Montgomery counties. Data centers have very localized impacts on water, air and noise, for which no standards yet exist, she said. 

Counties “need time to get their zoning ordinances or the regulations up to date,” Hester said. She pointed out that Maryland lawmakers in the last General Assembly session created what she called the first state data center registry in the country, which lists energy and water use and can expose the “phantom load” of developers filing duplicate requests in different jurisdictions. But it does not go into effect until January 2027.

Counties have authority over land and noise, and local governments are free to set tougher limits, she said. “We will have, probably, the best statewide framework for data centers in the country,” she said, “but it takes time to move from legislation to implementation.”