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Seeking solutions
The situation is further complicated by the fact that “no single regulator oversees the entire chain from power generation to customer bills,” according to Fortune. California residents of Lake Tahoe pay rates approved by California state regulators, but the Liberty grid that services them sits under NV Energy’s authority and is fully reliant on Nevada power transmission lines.
NV Energy is constructing a new $4.2 billion transmission line, called Greenlink West, that could help Liberty access a wider pool of energy suppliers. But as Fortune points out, the transmission project is scheduled to become operational by May 2027, which would be cutting it close for Liberty and Lake Tahoe’s needs.
Lake Tahoe’s woes may currently be an outlier, but many other US communities are grappling with energy supply issues and other associated costs of data center development—a Gallup poll from March 2026 found that seven in 10 Americans opposed AI data centers in their communities.
Public opposition to data centers has coalesced into “the most bipartisan issue since beer,” according to a Milwaukee-based comedian quoted in The New York Times. Nearly half of data center projects are facing delays and data center moratoriums, with industry executives citing issues such as labor shortages and power constraints as key factors.
Silicon Valley is well aware that its AI data center buildout has a popularity problem on top of the energy supply bottleneck and other construction complications. That may explain the turn to unusual schemes such as offering homeowners the chance to host mini data centers, along with more quixotic proposals such as launching orbital data centers into space and floating AI data centers in the middle of the ocean.

https://arstechnica.com/ai/2026/05/energy-supplier-abandons-lake-tahoe-residents-to-serve-data-centers/