40 mayors worldwide unite to fight back against the AI data centre surge

Forty mayors from cities across four continents have signed a landmark pact setting out the conditions under which they will accept AI data centres.

This comes as urban authorities push back against an industry they say is straining power grids, draining water supplies and squeezing out housing.

The pact, launched Tuesday during London Climate Action Week by C40 Cities, an alliance of nearly 100 cities working to tackle climate change, sets common standards on clean energy, site selection, water use and community benefit.

It is the first coordinated global attempt by city governments to get ahead of data centre expansion before it overwhelms them.

About 1,700 data centres are already located across C40's network of cities and development is expected to grow by more than 40% in 50 of those cities.

From Phoenix to Melbourne

The pact grew out of a conversation between the mayors of Phoenix and Melbourne, who found they were wrestling with identical problems: data centres consuming vast quantities of electricity and water, and competing with housing developers for available land.

"We found out that the challenges in every region around the world were very similar," said Cassie Sutherland, a managing director at C40. "Our approach was to say OK, how do we now use a global mayoral voice to come together with the conditions under which they will accept data centres."

Phoenix is among the top 10 data centre markets in North America.

Pending permit requests in the metropolitan area alone would double the city's electricity demand if all were approved. Mayor Kate Gallego said the current wave of investment is worsening climate change and failing local communities.

"We understand the importance of this innovation, it's creating great jobs in our community," Gallego said. "We just want to make sure that we get it right for our local residents and for the health of our planet."

In Melbourne, the picture is starker still. If the city follows through on all its current plans, data centres will consume up to 20 billion litres of water annually or around 4% of the drinking water supply, according to Lord Mayor Nicholas Reece.

The city's water supply is already under pressure from population growth, longer dry periods and intensifying heat.

What the pact demands

The standards are specific. Data centres should be built on abandoned or underused land, powered by renewable energy and battery storage, and required to reduce water use, cut emissions and capture waste heat.

They should create local jobs, source goods and services locally, fund their own infrastructure upgrades and engage meaningfully with communities.

Mayors are limited in what they can do alone. Sutherland said the vision must be translated into local regulations and guidelines, with buy-in from utilities, other government tiers and the private sector.

About half the 40 signatories are US cities, including Seattle, Chicago, Miami, Phoenix and Palo Alto.

European cities from Greece, Spain, Italy, Germany, the UK and Norway have also signed, alongside cities in Canada, Kenya, South Africa, Sierra Leone, Côte d'Ivoire, India, Australia and Lebanon.

Southeast Asia's conspicuous absence

None of Southeast Asia's cities signed the pact, despite the region accounting for a quarter of global energy demand growth.

More than 2,000 data centres are already operating across Indonesia, Malaysia, Singapore, Thailand, Vietnam and the Philippines, according to the think tank Ember.

The International Energy Agency says annual energy demand from those facilities will more than double within five years.

Malaysia in particular has become a magnet for investment from Microsoft, Google and Nvidia.

Several Southeast Asian cities said they could not sign because of national policies or other complications, C40 said, adding that conversations are continuing.

Data centres gravitate to cities because AI-powered systems require near-instantaneous response times, making proximity to clients essential.

They tend to cluster, forming metropolitan ecosystems where the business case outweighs land costs — a dynamic that has only recently begun pushing development into rural areas, according to Andrew Batson, global head of data centre research at JLL.

The pact's signatories are betting that a unified front changes the calculus. As Gallego put it, without one, developers will simply seek out cities too weak to demand anything better.