AI Data-Centre Transparency Faces Scrutiny as Tech Firms Drop NDAs

AI data-centre transparency is becoming a growing issue as technology companies race to expand the infrastructure needed to power artificial intelligence. Amazon has said it will stop using nondisclosure agreements (NDAs) when negotiating with local governments over data-centre projects, following a similar move by Microsoft earlier this year.

The shift comes amid rising public scrutiny of large data-centre developments. Residents and local officials want clearer information about how these facilities could affect electricity bills, water supplies, property values and surrounding communities. While companies argue that data centres support economic growth and AI innovation, opposition has increased in several areas where projects are being proposed.

Why AI Data-Centre Transparency Matters

NDAs can prevent local governments from publicly discussing details of proposed developments while negotiations are underway. This can leave residents uncertain about which companies will operate a facility, how much electricity and water it may require, and what incentives or public resources could be involved.

The lack of information can make it difficult for communities to assess the potential costs and benefits before decisions are made. It can also create suspicion when residents learn about major projects after negotiations have already progressed.

Greater disclosure could help communities understand the likely effects of a development and give them more opportunities to raise concerns. However, transparency alone cannot resolve disagreements over the location, scale or environmental impact of a data centre.

Amazon and Microsoft Move Away From NDAs

Amazon Web Services CEO Matt Garman said the company had stopped using NDAs in its dealings with government agencies as it seeks approval for new data centres. Microsoft had announced a similar policy earlier in 2026.

These decisions signal a response to growing pressure over how AI infrastructure projects are negotiated. They also place greater emphasis on explaining projects to local communities rather than relying on confidential discussions with government officials.

Still, ending NDAs does not necessarily mean every detail will become public. Commercial confidentiality, security concerns and other restrictions may continue to limit disclosure. The practical effect will depend on what information companies share, when they share it and how local authorities communicate with residents.

Electricity and Water Remain Major Concerns

Data centres require substantial electricity to operate servers and cooling systems. Their growing demand can put pressure on local power infrastructure, particularly in regions where utilities are already facing capacity constraints.

Water use is another concern, especially where facilities rely on water-based cooling in areas facing shortages. Communities may also question whether promised employment, tax revenue and other economic benefits justify the demands placed on local infrastructure.

For meaningful engagement, developers need to explain projected resource use, infrastructure requirements and the financial arrangements associated with a project. Publishing this information early can help residents evaluate claims and identify potential problems before construction begins.

Can Greater Transparency Reduce Opposition?

The shift away from NDAs is an important change in how technology companies approach data-centre negotiations, but it is not a guarantee of public support. Communities may continue to oppose projects if they believe the costs outweigh the benefits or if their concerns are not addressed.

For AI companies, the challenge is to demonstrate how proposed developments will affect the people living nearby. Clear disclosures, public consultations and credible plans for managing electricity and water demand can help create a more informed discussion.

As AI infrastructure expands, AI data-centre transparency is likely to remain central to debates over where facilities are built and who bears their costs. Companies will need to show not only what their projects deliver, but also how they plan to manage their local impact.