On September 30, the only codified federal baseline for what a secure, resilient, and accountable data center should look like will expire, and nothing clear is moving to replace it.
The Federal Data Center Enhancement Act of 2023, enacted as part of the National Defense Authorization Act for Fiscal Year 2024, requires covered federal data centers to meet standards for uptime, cybersecurity, physical security, resilience against power failure and natural disasters, and energy and water accounting. The Office of Management and Budget implementation guidance sunsets with it.
The law applies to federal facilities and certain agency data center arrangements, not every private hyperscale campus in the country. But that distinction does not make the expiration irrelevant. The FDCEA has become the closest thing Washington has to a codified statement of what responsible data center operations should include. Once it expires, local governments trying to write their own rules will have one less federal benchmark to borrow from, and developers will have one fewer standard to point to when communities ask what “good” looks like.
On its face, this is a federal procurement story. It is not. It is the final step in a broader federal withdrawal from data center standards, and it lands at the worst possible moment, because the fight over data centers has already moved to county commissions across North Carolina and South Carolina, where it is going badly for the industry.
Understanding how those two facts connect is the whole game.
The Federal Government Is Deregulating Into a Backlash
The sequence matters.
In July 2025, the President signed Executive Order 14318, “Accelerating Federal Permitting of Data Center Infrastructure”, aimed at fast-tracking data center construction and easing federal regulatory burdens for large-scale data center infrastructure. In September 2026, the FDCEA lapses and takes the last federal baseline with it. Washington will have moved in a sharply deregulatory direction on data centers from both sides: faster development on federal land and fewer federal standards governing what responsible data center operations should look like.
Now look at where public opinion sits.
A May Gallup survey found that seven in ten Americans oppose AI data center construction in their own communities. Elon University polling of 800 North Carolinians found 44 percent opposed to a data center in their community against 24 percent in support, with opposition leading across wide swaths of the state. Data Center Watch, a tracking project, counted at least 75 American projects worth approximately $130 billion delayed or blocked by local opposition in the first quarter of 2026 alone, and MultiState counted more than 300 data center bills introduced across 30-plus states in the first six weeks of 2026.
Regulatory demand does not disappear because the federal government declines to supply it. It relocates.
Every standard Washington abandons gets rewritten by a county commission, a town council, or a state legislature, each with its own definitions, its own politics, and its own memory of the last project that went wrong. The industry is about to trade one national rulebook for several hundred local ones, and the Carolinas are already showing what that looks like.
North Carolina: The Moratorium Wave Has a Legal Explanation
By the latest public tallies, at least 29 North Carolina counties or municipalities have passed data center moratoriums, according to data collected by the NC Data Center Newsletter. The list includes communities from Chatham and Orange to Gates, Canton, Boone, Kings Mountain, Wendell, Charlotte, and others, with additional local governments considering pauses or ordinance rewrites.
The common read is that this is pure sentiment. The better read is structural.
A provision tucked into North Carolina’s 2024 Helene relief legislation sharply limits local governments’ ability to downzone property without written consent from affected landowners. The UNC School of Government has described the change as a dramatic alteration of local zoning authority. That matters because a county that wants to keep hyperscale development out of a residential area cannot simply rezone the land away from that use. The moratorium becomes the cleanest remaining lever, so the moratorium is what spreads.
Anyone forecasting where the next pause lands should be studying zoning maps and the downzoning restriction, not just Facebook groups.
That makes North Carolina different from a state simply reacting to public anger. The backlash is real, but the policy structure matters more. Local governments are being asked to absorb hyperscale land-use, water, noise, and power impacts at the same time their traditional zoning tools have been narrowed. When the state limits one local tool without supplying a statewide replacement, the pressure does not disappear. It moves into moratoriums, conditional rezonings, litigation, and election-year politics.
That is why the next phase of the North Carolina fight is unlikely to be about whether data centers are good or bad in the abstract. It will be about who gets to set the terms before a project lands.
The politics have also turned personal.
In Stokes County, commissioners approved a rezoning for a nearly 2,000-acre hyperscale site in January over loud public opposition. By March, both incumbent commissioners on the Republican primary ballot had been defeated. A lawsuit followed, and the county later voided its own rezoning approval, acknowledging that the January zoning actions had no legal effect because of faulty notice.
In Edgecombe County, a challenger who warned commissioners that residents would primary them over a data center proposal went on to defeat a four-term incumbent. WUNC described David Batts’ campaign as focused largely on opposition to the proposed Kingsboro data center.
County commissioners across the state have absorbed the lesson: a yes vote on a data center can now end a political career. That changes the approval math on every pending project, regardless of its merits.
Raleigh Is Already Writing the First Draft
North Carolina is simultaneously one of the most active data center markets in the country and one of the most contested. That is exactly the condition that produces state legislation.
The important point is not simply that Raleigh has bills pending. It is that the bills are beginning to converge around the same political problem: local governments want siting authority, residents want water and noise protections, ratepayers do not want to subsidize new load, and the state still wants to compete for investment.
That is the shape of a statewide data center rulebook.
Senate Bill 730, the Ratepayer Protection Act, is the clearest signal. As it moved through the House, the bill proposed rules for large data centers using at least 100 megawatts of power, including closed-loop cooling requirements, noise-related site assessments, restrictions on local incentives, long-term utility contracts, and provisions designed to prevent electricity costs from shifting onto families and small businesses. A legislative bill summary and WUNC’s reporting both make clear that this is no longer a narrow land-use issue.
That is not just an energy bill. It is a political response to the full data center problem: power, water, local control, incentives, and public trust.
The Raleigh politics are more complicated than a simple pro-growth versus anti-growth fight. Republicans have to balance economic development, grid reliability, property rights, local control, and ratepayer anger. Democrats have an opening on water, energy costs, corporate subsidies, and community impacts, but they also have to account for jobs, tax base, and rural investment. Gov. Josh Stein’s push to phase out North Carolina’s data center tax exemptions by 2033 adds another layer, because it reframes the issue from environmental backlash alone to whether North Carolina should keep subsidizing projects that now bring visible infrastructure and ratepayer concerns with them.
None of this means North Carolina has closed.
Google announced another $1 billion investment in its Lenoir operations. Microsoft is moving toward permitting on its Person County data center development. Amazon’s $10 billion Richmond County complex continues. Vance County approved a rezoning in April for land that could be used for a data center.
The state is still a major data center market. But it is no longer a passive one. The next round of investment will move through a political environment where county commissions are nervous, state lawmakers are active, and ratepayer protection has become a bipartisan talking point.
For developers, that changes the strategy. The question is no longer just whether the site has land, power, fiber, and tax treatment. The question is whether the project can survive the public process long enough to use them.
South Carolina: The Legislature Blinked and the Counties Moved
South Carolina ran the same experiment with a cleaner result.
The General Assembly considered statewide data center rules this session and passed nothing. Within weeks, counties filled the vacuum.
Spartanburg County took its first unanimous vote on a one-year moratorium after residents raised concerns about projects in the county, including a $2.8 billion facility already under development. Colleton County, where a gigawatt-scale data center had been proposed near the environmentally sensitive ACE Basin, moved toward a six-month pause while reconsidering the zoning rules that made the project possible. Newberry County enacted a moratorium after rejecting a proposed land sale for a potential data center. Chesterfield County also moved to pause data center-related approvals.
Meanwhile, state lawmakers have filed moratorium proposals, including H.5526, which would prohibit state and local governmental entities from accepting or acting on data center permits until the General Assembly establishes a comprehensive oversight and approval process, and H.5286, which would pause final approvals until January 1, 2028.
The South Carolina sequence is the FDCEA story in miniature. A higher level of government declined to set a baseline, so lower levels of government set their own, and they set them harder.
That is the dynamic the September 30 federal expiration now applies to the entire country.
What the Expiration Costs, and Who Can Profit From It
Here is the insight most coverage has missed.
The FDCEA’s practical value was never limited to federal facilities. It was the only codified national statement of what a responsibly built and operated data center should account for: uptime, cybersecurity, physical security, power resilience, natural disasters, and energy and water reporting.
After September 30, that benchmark is gone.
Several hundred jurisdictions will be writing data center rules at once with no common template, which guarantees inconsistency, invites litigation like the Stokes County and Chatham County disputes, and raises the cost of every siting in the Southeast.
That is a problem, and it is also an opening.
The first state that enacts a credible statewide baseline will do two things at once: it will take the steam out of the moratorium wave by giving local officials something to point to besides a pause, and it will hand developers the predictability that now exists almost nowhere in the country.
A credible baseline probably needs five pieces: ratepayer protection, water-use standards, noise and setback rules, local siting authority, and a clear path for projects that meet the standard. If it only restricts, developers will fight it. If it only preempts local governments, counties will revolt. The political sweet spot is a rulebook tough enough for local officials to defend and predictable enough for developers to build under.
North Carolina and South Carolina are both positioned to be that state. Both have live legislation. Both have legislatures that watched county-level chaos consume the first half of 2026. Both are competing for a capital cycle measured in the tens of billions.
The race is worth watching, and worth engaging.
What Developers and Local Governments Should Do Next
For developers and the businesses around them, the conclusion is direct: the social license is now the critical path.
It runs ahead of power. It runs ahead of fiber. It runs ahead of incentives. A technically viable site that cannot survive the local politics is not a viable site.
The smart posture after September 30 is to adopt FDCEA-grade standards voluntarily, write them into rezoning conditions, and show up while the ordinances are being drafted. The rules written during a moratorium outlive the moratorium.
For local governments, the lesson is just as clear. A pause is not a policy. Moratoriums buy time, but they do not answer the underlying questions about water, noise, power, setbacks, emergency services, tax base, or who pays for the infrastructure needed to serve a project.
Communities are not going to stop regulating data centers. Developers are not going to stop looking for power, land, and fiber. States are not going to stop competing for investment.
The only question is whether the Carolinas write a rulebook that people can actually build under, or whether every county is left to write its own.