> it doesn't generate any real tax revenue

This is a choice the local government can make. You can read Loudon County's (us-east-1 + everything else) explaining what it does with the data center revenue it gets https://www.loudoun.gov/6188/Data-Centers-in-Loudoun-County.

> it increases electricity costs for the region

Also a choice the local government can make! I don't know about this specific case but I suspect we'll see local governments get more sophisticated when negotiating with tech companies.