New York State halts construction of all new data centers

New York became the first state to halt data center construction after Gov. Kathy Hochul signed an executive order today temporarily barring the state from approving new permits for large projects.

Hochul’s order applies to data centers of 50 megawatts or larger, potentially affecting more than a dozen projects. The state Department of Environmental Conservation will not issue any permits that have not already been completed.

While concerns about resources have fueled some of the backlash, broader concerns about artificial intelligence have been behind much of it as well. A recent Pew Research Center report found that only 10% of Americans were more enthusiastic than concerned about the use of artificial intelligence in daily life, and only 23% felt that the technology would have a positive impact on how people do their jobs. Less than a quarter of the general public felt that AI would give a boost to the economy, and less than a third were confident that the government would regulate the technology responsibly.

“Progress should not amount to higher utility bills, eliminating water supplies, or noise pollution,” Hochul said at a news conference in Brooklyn. “These data centers can only be built where you want them. So they will never be exempt from local zoning, or local approvals.”

The moratorium will be lifted once the state completes the environmental review process for data centers, which Hochul expects will take about a year. Hochul’s office is also considering requiring data centers to pay into a fund that would support the state’s electrical grid, and she wants to prevent high-volume data centers from receiving tax benefits.

Hochul’s executive order arrives as tougher measures move through the New York Legislature. Last month, the Legislature advanced a bill that would halt construction of data centers with capacity greater than 20 megawatts for one year, while another bill still in committee would impose a three-year moratorium.

The average data center built in the past few years has been less than 100 megawatts, but those under development are expected to be much larger as artificial intelligence drives increased computing requirements. By 2030, nearly a quarter of new data centers It will exceed 500 megawattsaccording to BloombergNEF, driven by increased investment in artificial intelligence.

The idea of ​​a moratorium on data centers has been discussed at the state and federal levels, but New York is the first to put this into effect. In December, more than 230 organizations called for a nationwide moratorium on new data centers. Vermont Sen. Bernie Sanders has also proposed a nationwide moratorium, though it has not received much attention. Recently, the Maine legislature passed a bill that would have temporarily halted construction of new data centers until November 1, 2027, but Governor Janet Mills vetoed it.

Just years ago, data centers were in demand by countries eager to secure new development projects, but more recently, Public sentiment in data centers has soured With the growth in the volume of new projects. The scale and pace at which it is being built has begun Electrical grid strain In addition to regional resources such as water and agricultural land. Two-thirds of participants in a recent poll said they were Concerned about data centers raising electricity prices. Another survey found that people would rather have an Amazon warehouse in their backyard From the data center.

Hochul’s order may be a prelude to a clash with the Trump administration, which has so far supported data center development. Last month, the Federal Energy Regulatory Commission, led by a Trump appointee, told grid operators to do just that Develop special fast routes To speed up connectivity between data centers.