New York State Halts Construction of All New Data Centers

New York Governor Kathy Hochul signed an executive order on Tuesday placing a moratorium on new data center construction for projects of 50 megawatts or larger, affecting over a dozen proposed sites. The state's Department of Environmental Conservation will not issue permits until an environmental review process is completed, which Hochul expects to take about a year.

"Progress shouldn't arrive with a higher utility bill, deleted water supply, or noise pollution," Hochul said at a press conference in Brooklyn. "These data centers can only be built, should only be built in places that want them. So they will never be exempt from local zoning, local approvals." The governor's office is also considering requiring data centers to contribute to a fund supporting the state's electrical grid and preventing hyperscale centers from receiving tax benefits.

The moratorium comes amid growing public skepticism toward AI and data centers. A Pew Research report found only 10% of Americans are more excited than concerned about AI in daily life, and just 23% believe it will positively impact jobs. Less than a quarter think AI will boost the economy, and fewer than a third trust the government to regulate it responsibly. A recent poll showed two-thirds of respondents worry about data centers raising electricity prices; another survey found people would rather have an Amazon warehouse in their backyard than a data center.

New York is the first state to enact such a moratorium, though similar measures have been debated. In December, over 230 organizations called for a nationwide pause. Vermont Senator Bernie Sanders proposed a national moratorium, but it gained little traction. Maine's legislature passed a bill pausing construction until 2027, but Governor Janet Mills vetoed it. Hochul's order may clash with the Trump administration, which has supported data center growth. The Federal Energy Regulatory Commission recently directed grid operators to fast-track data center interconnections. Meanwhile, New York's legislature advanced a bill to pause centers larger than 20 megawatts for one year, with another proposing a three-year moratorium.