Data Centers Expand into Rural Areas Competing with Agriculture

Data centers may compete with farms for key resources.

LUBBOCK, TEXAS (RFD NEWS) — Data centers are rapidly expanding into rural areas, raising new concerns about competition for land, water, and electricity with agricultural operations. Texas A&M AgriLife economists say the impact will depend on how these facilities use local resources and how communities manage development.

Texas is emerging as a major hub, with about four gigawatts of data center capacity already in place and nearly eight gigawatts under construction. Large-scale facilities can span hundreds of acres and operate continuously, consuming as much electricity as a small city.

Farm-Level Takeaway: Data centers may compete with farms for key resources.
Tony St. James, RFD NEWS Markets Specialist

That demand could strain rural power systems. Year-round electricity use may drive higher rates and increase grid pressure, especially during peak summer irrigation periods. Water use is also significant, with some facilities requiring more than a million gallons per day, adding pressure on groundwater resources in key aquifers.

Land use is another concern. Once converted, these sites rarely return to agriculture. While data centers can generate tax revenue, they create relatively few long-term jobs.

Related Stories
Rayburn Electric Cooperative’s Chris Anderson discusses rapid AI data center expansion, mounting pressure on the electric grid, and impacts on agriculture and rural communities.
Bredenkamp discusses industry support, Senate challenges and the push for expanded E15 access.
Industry leaders say producers could still benefit even with many operations already using reduced-tax off-road diesel.
ASFMRA’s Paul Burgener shares updates on the Hunggate Fire, Panhandle wildfire conditions, infrastructure damage and potential impacts to agriculture in the region.
Smith says the measure would expand fuel choices for consumers while advancing energy independence.
Ethanol production climbed to a four-week high while inventories fell to their lowest level since early October, according to energy data analyzed by the RFA.

Tony St. James joined the RFD-TV talent team in August 2024, bringing a wealth of experience and a fresh perspective to RFD-TV and Rural Radio Channel 147 Sirius XM. In addition to his role as Market Specialist (collaborating with Scott “The Cow Guy” Shellady to provide radio and TV audiences with the latest updates on ag commodity markets), he hosts “Rural America Live” and serves as talent for trade shows.

LATEST STORIES BY THIS AUTHOR:

FarmHER Debra Lockard joined us Friday on the Market Day Report to discuss her upcoming show episode, which premieres on Tuesday, October 1 at 9:00 PM ET, only on RFD-TV!
Meet FarmHER Debra Lockard, a third-generation Tennessee produce grower who splits her time running two farms in West Tennessee and teaching ag classes that promote sustainable farming practices in her Memphis community.
What are some common mistakes that farmers and ranchers make regarding estate planning? Here are a few key ideas to consider from RFD-TV Ag Legal and Tax Expert Roger McEowen with the Washburn School of Law.
RFD-TV Farm Accounting & Tax expert Roger McEowen discusses crucial legal and tax issues for farmers and ranchers to manage operational risks in this Firm to Farm blog post.
The FarmHER crew catches up with fifth-generation California sweet baby broccoli producer Kate Hitchcock and her team in the middle of the harvest season in the Salinas Valley.
RFD-TV ag legal expert Roger McEowen examines common issues facing farmers, ranchers, and rural landowners: SAF fuel, R&D credit, drones, and cleaning fencerows.