Prompts now, pollutants later: Report claims data centers are harming the environment to the tune of $25 billion and inducing a debt on the health of current and future generations

Date:
Wed, 29 Apr 2026 22:05:00 +0000

Description:
A new paper theorizes that the cost of gross external damages generated by data centers could exceed $25 billion.

FULL STORY ======================================================================Copy link Facebook X Whatsapp Reddit Pinterest Flipboard Threads Email Share this article 0 Join the conversation Follow us Add us as a preferred source on Google Newsletter Subscribe to our newsletter Data centers and their energy requirements are causing pollution This pollution is causing knock-on costs for healthcare and the environment A cost of as much as $25 billion is theorized, but it could be higher The surge of AI and its demand for data centers could be costing the US economy $25 billion in environmental damage and causing serious health complications for those living in the vicinity of data centers.

These figures come from a new working paper written by Nicholas Z. Muller, an economist at Carnegie Mellon University, and published by the National Bureau of Economic Research. The paper examined around 2,800 operational data
centers on their energy requirements, and examined the impact of additionally generated air pollutants and greenhouse gases on the environment, the health of US citizens, and its cost on the economy. Article continues below You may like Shocking emissions stats revealed for 11 planned AI data centers in the US Surge in ultra-hot data centers is creating extreme heat islands AI boom triggers new battles over electricity infrastructure costs Lung disease,
heart conditions, premature mortality In the paper, Muller calculates the $25 billion gross external damages (GED) figure by calculating not only the artificial intelligence usage within data centers (to which he attributes a figure of $3.7 billion), but also the wider, indirect costs of the pollutants caused by generating the necessary energy to power data centers.

Mullers paper theorizes that the planned expansion of data center
construction could increase associated damages by up to 85% in the near term.

These costs include the additional burden on healthcare facilities and day-to-day medical requirements by local residents, which Muller attributes
to the negative effects of exposure to the airborne pollutantPM2.5, which can cause lung disease, heart conditions, and higher rates of premature
mortality.

There are also wider social costs associated with pollutants and greenhouse gasses that are yet to materialize, but nonetheless are being emitted from
the additional energy sources being constructed or revived to fuel the boom
in demand for energy. Are you a pro? Subscribe to our newsletter Sign up to the TechRadar Pro newsletter to get all the top news, opinion, features and guidance your business needs to succeed! Contact me with news and offers from other Future brands Receive email from us on behalf of our trusted partners
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The Trump administration's stance against renewable energy sources means that legislation has been put forward to revive a number of previously decommissioned fossil fuel power plants in order to provide for the extra demand, and in turn are releasing more pollutants and greenhouse gases.

These external costs are not borne by the tech companies funding the construction of data centers, who instead enjoy significant tax breaks for their investments in new construction projects, leading to less tax revenue
to fund the construction of the additional infrastructure needed to power and transfer electricity to power data centers.

The Trump administration did introduce the Ratepayer Protection Pledge to
bind the additional costs of energy production to tech companies, but the pledge is entirely voluntary and bears very little in the way of accountability, timelines, or provisions. Some communities in the US are now experiencing skyrocketing energy costs due to the energy demands of data centers. What to read next Nearly half of US data centers planned for 2026 canceled or delayed Barely any EU data centers are actually ready for AI -
and upgrading could be a costly challenge An ex-programmers devastating take on AI data centers is going viral

There are also the issues with the employment provided by data centers. While the initial construction may provide a boost in jobs, the effect is largely temporary. Many data centers are automated and require little supervision to operate.

Mullers paper does calculate that the economic costs of environmental damage and healthcare related costs are small when compared to the potential productivity gains produced by AI, but residents living in the vicinity of data centers may disagree with this assessment.

There is now a growing anti-data center sentiment across the US , with numerous grass-root, local resident groups opposing the construction of data centers, leading to major project delays and cancellations. There also
appears to be a general downward trend in the opinion of AI, with up to 71%
of US citizens believing that AI could cause permanent job loss , and almost half (47%) believing it will have a negative effect on humanity.

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Link to news story: https://www.techradar.com/pro/prompts-now-pollutants-later-report-claims-data- centers-are-harming-the-environment-to-the-tune-of-usd25-billion-and-inducing- a-debt-on-the-health-of-current-and-future-generations


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