As communities across America debate whether to approve new data centers, some are implementing moratoria based on concerns over water use and noise pollution. Most recently, New York issued an executive order banning data center construction for one year while the state looks to address environmental concerns with more regulation and red tape. Those concerns deserve to be taken seriously, but banning or regulating data centers out of business would needlessly sacrifice economic opportunity and America’s technological leadership. Let’s look first at the water issue. Data centers’ water usage comes primarily from their cooling systems. Most data centers currently use an evaporative cooling system, which uses freshwater to absorb heat and let that water evaporate, carrying the heat away. This can lead to decreasing water supplies, especially in drought-prone areas. However, there are solutions already being put into place. Many developers have heeded community feedback and are rapidly moving toward more water-sustainable methods of their own accord. Microsoft pledged that every data center built after August of 2024 would use chip-level closed loop cooling which uses no additional water for cooling after the system is initially filled. Amazon’s data centers already use air cooling 90% of the time and employ evaporative cooling only during times of extreme heat. In an effort to reduce community water impacts even further, the company has already taken steps to require some of its facilities to use 100% reclaimed water. Google has voluntarily pledged by 2030 to replenish more water than they consume in communities where they operate. Steps like this, taken at the local and individual business level, demonstrate that communities can enjoy the economic benefits of data centers without devastating environmental impacts. Water withdrawals are not the only environmental concern critics raise. Some wonder about thermal and chemical pollution of water deposited back into the local water supply from data centers after cooling using a non-closed loop system. Data centers, just like other industrial facilities, must obtain a special permit that governs wastewater discharges into public waterways, ensuring public health and safety are protected. Further, most companies send their wastewater to wastewater reclamation facilities that remove any pollutants before depositing it back into local water supply. In the future, data centers may even produce more freshwater than they will use. Research is also being done to use data center waste heat to help desalinate seawater, where the system would cool the chips and produce needed freshwater simultaneously. This technology would provide data centers with an essential feature for operation while simultaneously replenishing community water supplies where needed. Regardless, the issue must be put into perspective. Data centers are projected to consume less than a 0.5% of the total national water supply per day by 2030. That number will likely be lower as developers continue to innovate, become more efficient, and respond to community concerns. On a national level, data centers are not destroying America’s water supply, and innovations that reduce water usage help alleviate strain on local rivers, reservoirs, or aquifers should be encouraged. Then there is the noise. Some local communities have complained that the noise emanating from data centers is a problem. Understandably, no one wants a noisy industrial facility down the road. It is a legitimate concern and data center owners are already responding to this issue to reduce noise by using quieter cooling systems or fan silencers, soundproofing materials in construction, and better site planning. In Mäntsälä, Finland, local officials reportedly described Nebius’ data center as a good community investment with no noise complaints, helped by a design that relies on free cooling, which uses cool outside air to remove heat. With technological innovations already underway to address community concerns, blanket data center moratoria are not the only solution. The fact is that data center developers are already responding to each of these challenges. The market is forcing them to innovate in response to what people want. Regulation will just get in the way of this process by replacing the demand of those who live near and work at data centers with that of politicians and bureaucrats.   Free enterprise rewards companies that meet the needs of the people as efficiently as possible. This means not only innovating to stay ahead of their competitors, but also working to maintain good community relations. Businesses have repeatedly innovated to reduce water and electricity use because doing so lowers costs while minimizing their environmental footprint. Further, companies that ignore legitimate concerns over water use or noise risk damaging their reputations, facing local opposition, and losing future business opportunities. Those market incentives, combined with narrowly tailored environmental protections, encourage continuous improvement without resorting to blanket moratoria or one-size-fits-all mandates. America needs more, not fewer, data centers. Blanket moratoria are a solution in search of a problem. Policy solutions should encourage innovation and development that enables both local communities and these critical facilities to thrive.