Chamath Palihapitiya says Big Tech’s AI push is facing an overlooked risk that could seriously derail the data center buildout.
In a new post on X, the billionaire venture capitalist points to a sharp rise in canceled projects tied to local opposition over electricity costs.
“In 2025, 25 data center projects were canceled due to community pushback. That’s up from just 6 in 2024 and 2 in 2023. The opposition is notably bipartisan, driven overwhelmingly by one thing: rising electricity prices for local residents. In Q2 2025 alone, 20 projects were blocked or delayed, putting $98 billion in potential investment at risk.”
Looking closer at the numbers, Palihapitiya says the cancellations are impacting AI revenue to the tune of tens of billions of dollars. But he notes that the figure is astronomically higher when applying a valuation framework.
“The 2025 cancellations represented ~4.7 gigawatts of lost electricity capacity. Using OpenAI’s own estimate of revenue per gigawatt (~$10B revenue per gigawatt), those cancellations represent ~$50B in lost AI revenue in a single year.
Applying a 20x earnings multiple and it’s $1 trillion in lost enterprise value in one year!”
Palihapitiya says that nearly 100 data center projects are at risk of being canceled unless the consumer is shielded from rising electricity costs.
“At least 99 data center projects are currently being contested nationwide. Historically, ~40% of projects facing sustained opposition are eventually canceled. The core problem as I see it: local residents are being asked to subsidize AI infrastructure through higher electricity bills with no upside. That’s not a sustainable ask.
Until we solve the electricity cost equation, community opposition will remain a systemic and under-priced risk to the AI sector and the broader economy.”
In January, Palihapitiya called on the US government to establish a $500 billion federal tax equity fund to help eliminate electricity costs for 100 million Americans.
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