Santa Clara, known for hosting major tech giants like Nvidia, Intel, and AMD, is capitalizing on the surge of data centers.
The city, located in the south San Francisco Bay Area, currently has 58 data centers, making it the most concentrated area for such facilities on the West Coast. They are investing $459 million to expand their power grid to accommodate even more data centers. Nearly all of these centers are situated within Santa Clara’s boundaries and those of neighboring Mountain View.
Residents in Santa Clara benefit from lower utility rates, as the local utility, Silicon Valley Power, which is city-owned, charges 18.2 cents per kilowatt-hour. This rate is about 57% cheaper than the 42.2 cents charged by Pacific Gas and Electric (PG&E), which serves much of Northern California.
Additionally, Santa Clara generates around $29.5 million annually from the data centers, funding essential services like police, parks, libraries, and other community needs.
One resident at Santa Clara Square, an apartment complex surrounded by data centers, shared her electricity bill averages about $130 monthly, covering electricity, water, and garbage. She expressed a desire for any future construction of data centers to lead to either reduced rent or lower electricity bills.
Having lived at the Square for nearly five years, she mentioned that she was unaware of the numerous data centers around her. For the moment, she feels it doesn’t bother her.
Contrastingly, a former resident noted that their electricity bill soared fivefold after relocating.
Up north, San Francisco County has 15 data centers, where local officials are considering a 45-day pause on any new developments, citing the historical pollution issues in the Bayview neighborhood. Supervisor Shamann Walton emphasized the need to understand the impacts of data centers on communities before permitting new construction.
Santa Clara and San Francisco differ significantly in size; San Francisco hosts about 800,000 residents within just 47 square miles — making it densely populated, with nearly 18,600 individuals per square mile. Consequently, most data center sites will have nearby homes. In contrast, Santa Clara’s population is around 133,000 across 18 square miles, roughly a third as densely populated, with many data centers located in an extensive industrial area of office parks and semiconductor plants.
Neighboring counties like San Mateo and Alameda have two and 14 data centers respectively, yet both have seen local resistance to further expansions.
A Gallup poll from May revealed that nearly 70% of Americans would oppose data centers being established in their communities, which is more opposition than there is for nuclear plants.
The term “data center” has gained a complex reputation. Researcher Jonathan Koomey, who has studied data centers for over 25 years, highlighted that not all data centers are alike. Some smaller ones, if managed correctly, may have similar impacts on the environment as conventional warehouses or office buildings.
Koomey, who also offers guidance on efficiency goals to AMD and receives Amazon funding for research regarding water usage in data centers, noted water concerns as well. However, a briefing from May 2025 indicated that most data centers in Santa Clara utilize recycled water — specifically treated wastewater from showers and toilets.
While this recycled water isn’t safe to drink, Koomey mentioned that it is suitable for watering golf courses or cooling operations in a data center. The use of such water contributes to minimizing the water usage footprint of data centers, although he acknowledged that different facilities handle water consumption in various ways.
In Santa Clara, developers building data centers cover their own connection costs as well as contribute to broader system upgrades. For instance, when local servers require more power than the existing substation can manage, Intel is financing the entire cost of the expansion, along with approximately $10 million in fees for the additional load.
“It’s essential for those creating costs for society to shoulder those costs,” Koomey pointed out.
Nonetheless, not everyone is completely convinced. The city has noted complaints regarding noise, height, and aesthetics following the establishment of one data center on Memorex Drive.
Residents have begun to monitor the environmental impact in their own ways. One individual, observing the vibrant wildlife around a local creek, mentioned, “If I started to see a negative effect on the wildlife thriving by that creek, then I would probably be more concerned or have an issue with it.”
