The Ontario government appears to be at odds with some of the province’s major cities over the future of AI data centres, with anxiety-riddled residents caught in the middle.
Premier Doug Ford recently said Ontario needs to move “full steam ahead” with building data centres in the province, adding that there will be strict parameters around where they’ll be located and how they’ll be built.
The foot-to-the-floor approach, however, seems to be in contrast with numerous municipalities that have passed measures to slow the construction of data centres, citing fears over noise, water usage and environmental impacts.
In August, Oakville became the first Ontario municipality to approve a one-year moratorium on data centre development. One month later, Mississauga and Sault Ste. Marie followed suit.
Conversely, both Hamilton and Burlington city councils voted down motions to put a pause on building.
In an effort to wrest back some control over the future of data centres, the Association of Municipalities of Ontario (AMO) submitted a ten-page report to the Ministry of Energy and Mines, outlining its top priorities.
Given that data centres don’t provide many jobs post-construction, AMO is looking for the province to give preference to projects that factor community benefits into their proposals, such as building a community centre to go along with their data centre.
AMO is also asking for confirmation from the province that hosting a data centre “will not undermine the ability of municipalities to deliver other provincial and municipal priorities” by draining excessive amounts of power from already strained systems.
Minister of economic development Vic Fedeli addressed some of AMO’s concerns during a recent news conference, saying data centre companies will have to pay a premium rate for power, or generate their own.
Get daily National news
Get daily Canada news delivered to your inbox so you’ll never miss the day’s top stories.
Fedeli added the province has adopted a “do no harm to the municipality” approach, a policy that would apply to data centre developers.
That includes only offering “non-financial support” to attract data centre investments and requiring data centres will to pay for the cost of their electricity use to ensure ratepayers don’t pick up the tab.
What remains unclear is if a provincial government with a track record of bypassing city council decisions would push past a hesitant host to build a data centre.
When asked what he’d do if faced with such a situation, the premier said that he would “sit down with the mayor and council and consult with the community” but that he’d rather go to a “willing host.”
Anxieties on the local level
At the Mississauga city council meeting where the AI data centre prohibition was being discussed, local residents demanded that the city pause the approvals of any projects to take more time to consider the consequences.
Among those keeping tabs on proceedings was Katie Steinfeld, a real estate agent who closely monitors Ontario AI data centre proposals.
Frustrated by a lack of readily available information on data centre projects, she created the Ontario Data Centre Tracker, a website that logs and provides details on data centres across the province.
“I think pausing is a good thing,” Steinfeld said. “It doesn’t mean you’re saying ‘no’ to data centres. It’s just saying let’s take a step back because these developments are coming at a hyperscale, and we’re not caught up in terms of regulations and in terms of knowledge.”
Steinfeld created the data centre tracker in part because of anxieties expressed by her real estate clients. “When people are looking to buy a home, they want to know where they’re going to be moving to and what might be planned for that neighbourhood,” she said.
“Through the work that I’ve done, I have received outreach from people that said ‘I’ve just moved to this neighbourhood, and I saw that there’s now [a data centre] planned, and now I want to move.’”
Ford, who revealed an AI data centre playbook in August, also said residents are “misinformed” about the potential drawbacks of data centres.
But the government itself may be misinformed about how much a data centre’s physical location coincides with the concept of data sovereignty, according to one AI expert.
Evan Light is an associate professor within the University of Toronto’s Faculty of Information.
He says determining whether data is accessible by the United States or not depends on the origin of the company that owns the data centre, not where the centre is located.
“The U.S. Cloud Act allows the U.S. government to peek into whatever data is held by American companies wherever they may be operating. Just because we propose building things here doesn’t mean that we completely control them.”
The Ford government says they’ll prioritize Canadian projects, but American companies are already building here in Ontario. The new hyperscale data centre in Vaughan is owned by Microsoft, for example.
“There’s a lot of infrastructure that they’re not talking about,” Light said. “Just because you have data centres in Canada doesn’t mean that your data only stays here. It doesn’t go from your home to a data centre. If anything, it would probably transit through the U.S. and come back.”
While a timeline for provincial approvals is unclear, the government wrapped up a 30-day consultation period on its data centre playbook, suggesting legislation might be tabled in the fall session at Queen’s Park.
© 2026 Global News, a division of Corus Entertainment Inc.
